Hepburn Shire Council’s chief executive says the cost of providing planning services will remain greater than the amount raised in fees, despite changes proposed by the state government.
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The council’s chief executive Aaron van Egmond said non-statutory planning fees are set by council each financial year and adopted by council prior to July 1 of each year.
He said the council did not make a submission in support of the increase in fees. Current planning fees only recover about 20 to 30 percent of actual costs to Victorian councils to complete approval process.
However, under the state government’s new model, applicant fees will cover an estimated 60 to 70 per cent of planning costs.
Municipal Association of Victoria chief executive Rob Spence said the government projected this could generate an additional $40 million extra in fees collected by councils each year, which will reduce pressure on municipal budgets.
For the past decade, ratepayers have subsidised the majority of costs associated with application processing.
But Mr van Egmond said the fees are statutory fees, imposed on council by state government regulations and any changes will have no impact on council.
He said the fees are reviewed annually and voted on by the council. Mr van Egmond said the cost of providing planning services was greater than the amount raised in fees.
“This will continue to be the case even with the state government increase in planning fees,” he said. “It is important to ensure fees are at an appropriate level to not discourage development on one hand and on the other make sure that the majority of the cost of the service is paid for by those that utilise the service.”
Mr Spence said prior to the state government’s review earlier this year, planning fees had not been updated since 2000.
“The planning system has been chronically under-resourced for many years,” he said.
A 2010 review never took place and interim fees were renewed each year without any indexation to assist with councils’ rising costs.