Downturn could delay surf life saving club

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The City of Wanneroo needs a loan to deliver the Yanchep Surf Life Saving Club in the third year of the development contribution plan. Picture: Anita McInnes

THE downturn in the housing industry has led to the City of Wanneroo seeking more money from developers to enable it to deliver Yanchep and Two Rocks infrastructure projects on time.

Last year the city adopted a development contribution plan for the Yanchep Two Rocks area, which was based on a higher number of dwellings than has eventuated.

Now the city is in the situation of having to take out a loan to deliver infrastructure such as the Yanchep Surf Life Saving Club.

At its Tuesday, August 16 council meeting the city voted to propose a change to apportionment of costs between the city and the Yanchep Two Rocks Development Contribution Plan and an increase in the cost contribution for each dwelling.

Councillors also voted unanimously to notify affected landowners of the proposed cost increase and to invite comment in writing from those landowners for a period of 28 days.

An officer’s report presented to the council said in 2015 landowners estimated 655 dwellings would be developed in 2014-15 when the actual number of dwellings developed had been 181.

Also in 2015 the landowners had estimated that 972 dwellings would be developed in 2015-16 when the actual (to date) figure had been 172 dwellings.

“The revised projections provided by the landowner group now acknowledge the slower rate of development being experienced, more recently due to a slowdown in the property market, but [they] expect that the market will improve in about three-years’ time,’’ the report said.

The lower than expected income being generated through the development contribution plan means the city now needs to take out a loan to deliver the Yanchep Surf Life Saving Club and the Yanchep District Open Space in the third year of the development contribution plan.

The report said the main issues requiring consideration related to the dwelling estimates, and development contribution plan costs, which included both the facility costs and the specific details of the loan that is established.

Landowners can comment on any proposed increase in cost estimates, which the report said the city’s administration would prefer to increase from $2070 a dwelling to $2780 a dwelling   and the council was required to give due regard to any submissions made in this respect before deciding whether or not to increase the development contribution plan costs.

“Landowners may also object to the amount of a cost contribution and request a review by an independent expert.

“If this does not result in the cost contribution being acceptable to the landowners then ultimately they can request that the cost contribution be determined through a process of arbitration.

“The key concern of the landowners relates to the significant loan funding being proposed to provide for the delivery of the Yanchep Surf Life Saving Club and Yanchep District Open Space in the early years of the development contribution plan, and the large proportion of the total costs proposed to be made up of costs to service the loan.

“[Landowners] suggestion to reduce the debt liability and associated interest cost is to push back the timing of these facilities to a time when sufficient income has been generated through the development contribution plan to fund the construction of these facilities.

“While ordinarily this would be the approach to staging the delivery of development contribution plan facilities, another purpose for establishing development contribution plans is to provide for the early delivery of infrastructure.’’

The report said the early delivery of the Yanchep District Open Space  was subject to extensive consultation and engagement with all landowners in the development contribution plan area and was a key reason for the inclusion of land acquisition costs for this facility in the development contribution plan.

“It was always the intention for the development contribution plan to provide the mechanism for the early delivery of this facility, and associated with this proposal is the need to access loans funds to facilitate the construction of the facility in advance of sufficient income being generated through the development contribution plan to do so.’’