Section 7.11 Contributions
Published on 05 December 2024
As part of Kiama Council’s ongoing work to review its processes and finances, and our commitment to transparency, Council has reviewed its Development Contributions Framework and has determined that between July 2022 and June 2023 some customers were not charged appropriately.
The findings of the review are being presented to Council for endorsement at its 10 December Ordinary Meeting and it is proposed to refund any overpayments made.
Development contributions help fund infrastructure like parks, sports fields, community facilities, local roads, footpaths, and traffic management.
Local development contributions are levied on Development Applications (DAs) and Complying Development Certificates (CDCs) under either a Section 7.11 or Section 7.12 contributions plan. The contribution amount is then included as a condition of consent in the approval and must be paid before the development is carried out.
The review found that around 20 DAs and CDCs levied during the 2022-23 financial year were calculated using a spreadsheet that resulted in an overcharge.
The staff recommendation is that current landowners be notified of the overcharge and the process to modify the relevant consent, or if already paid, how to request a refund.
Council has already taken many steps to improve its planning and development processes to ensure that all contributions are calculated correctly. This has included preparing an updated contributions calculator, repealing the Section 7.11 Plans and updating its Section 7.12 Plan.
The balance of Council’s Section 7.12 contributions reserve as of 30 June 2024 is $13.6m. The contributions reserve is a restricted reserve from which funds can only be used for projects and works that benefit the community under legislative guidelines.
For example, projects such as the Jamberoo Dog Park will receive the additional funding needed to complete the non-grant funded portion of works from Council’s contributions reserve.
Council has estimated the total refunds to correct the 7.11 overpayments to be $625,000. As it’s a restricted reserve, refunds will not impact Council’s unrestricted cash position.