City of Melville holding millions in unclaimed kerb security deposits

Stock image.
Stock image.

CITY of Melville is holding $4.9 million in unclaimed kerb security deposits and has made no attempt to alert the owners of the money.

More than half of that amount – $2.9 million – has been held for more than 24 months, the period of time a building licence usually remains valid.

The City requires a kerb security deposit of $1900 before approving construction work valued at more than $20,000, demolitions or swimming pool installations.

Once work is complete, the verge is inspected to ensure it matches pre-works condition and the deposit is refunded.

But it is up to the owner to remember to arrange an inspection and the City does not provide reminders.

The City is not alone, with a range of Perth councils such as Canning, South Perth, Stirling, Bassendean, Wanneroo, Bayswater, Peppermint Grove and Cottesloe also holding unclaimed kerb security deposits.

Melville chief executive Shayne Silcox said applicants were informed of the refund procedure when paying the deposit.

“It is both unfeasible and uneconomical for the City to monitor the progress of every single building/pool/demolition application to know when they are complete,” he said.

Bateman resident Anne Hall paid the deposit when renovating her home in 2013 and was only reminded she had not reclaimed it when her son completed his own renovation earlier this year.

“Due to the length of the renovation and the business surrounding the new development I simply forgot, apparently along with many hundreds of other Melville residents,” she said.

“I am astounded the City feels it can hold money generating interest and think that’s entirely ethical.

“Would it be ‘unfeasible or uneconomical’ to advertise in the local paper a reminder about the security deposits? Perhaps the City should undertake a position of working for its constituents rather than against them.”

Mrs Hall also asked why she received no interest on her deposit when it was returned and why the City had not set up an automatic reminder process.

Dr Silcox said the City had sought legal opinion and audit advice on how to treat the deposits, which collected little interest.

“In addition, the footpath inspections before and after construction are carried out free of charge, with any interest earned contributing towards the costs of doing so,” he said.

Dr Silcox also said the City was reviewing the refund process of the kerb security deposit scheme.

Improvements could be made at the end of the review.

 

HOW OTHER COUNCILS TREAT KERB SECURITY DEPOSITS

While the specific name and conditions vary, the majority of Perth metropolitan councils require some form of kerb security deposit before granting a license to build or renovate.

Depending on the council, the purpose of the bond is to prevent damage to the kerb, verge, street trees, path, drainage structures and pavement.

City of Canning

Kerb security deposit: $1100

Current kerb security deposit holdings: $1 million

Amount held more than 24 months: $500,000

Reminder provided: No

In most cases, the City receives a request for a bond to be returned when work is completed. The City does not provide reminders to people regarding unreturned bonds. The bond is the responsibility of the landowner/developer.

– City of Canning spokesman

 

City of South Perth

Kerb security deposit: Between $500 and $4400 depending on scope and cost

Current kerb security deposit holdings: $850,000

Amount held more than 24 months: $100,000

Reminder provided: Yes

The City sends letters to builders or property owners who have not requested a refund.

The reminder letters for any bonds not claimed are sent once the completion notice is received by the City or normally when an application is two years old.

– City of South Perth chief executive Geoff Glass

 

Town of Bassendean

Kerb security deposit: Not always required, but assessed at $85 per metre of street frontage, minimum $2250

Current kerb security deposit holdings: $820,000

Amount held more than 24 months: $624,000

Reminder provided: No

When we issue a Building Permit for works where there is a high risk of damage occurring to our infrastructure, the Town’s Asset Services section asks the building surveyor to formally advise the licensee that they are required to pay a security bond.

This payment may be seen as a charge against release of a Building Permit but it is not, it is tied to the construction, but not to the approval.

– Town of Bassendean chief executive Bob Jarvis

 

City of Bayswater

Kerb security deposit: $900 (of which $150 is non-refundable)

Current kerb security deposit holdings: $561,000

Amount held more than 24 months: $181,000

Reminder provided: Yes

Upon payment of the Verge Protection Permit the applicant agrees to submit a Notice of Completion of Works at which time the City’s Verge Protection Officer inspects the site for damage and, if none has occurred, returns the $750 fee.

The City also proactively follows up with applicants who fail to submit a Notice of Completion of Works.

– City of Bayswater Mayor Barry McKenna

 

City of Wanneroo

Kerb security deposit: $2000

Current kerb security deposit holdings: $984,000

Amount held more than 24 months: Not provided – scheme only introduced in 2016

Reminder provided: Yes

The onus is on the applicant to contact the City and reclaim the bond.

The City holds any unclaimed bonds for a period up to six years, during which time attempts will be made to contact the applicants to arrange a refund.

After this time, any unclaimed bonds will be referred to WA Treasury who register and hold it in trust in accordance with the requirements of the Unclaimed Monies Act.

– City of Wanneroo acting assets director Grant Chettleburgh

 

Shire of Peppermint Grove

Kerb security deposit: $1000

Current kerb security deposit holdings: $101,000

Amount held more than 24 months: $20,000

Reminder provided: Yes

Once the Shire has received a certificate of completion from the builder we carry out an inspection to refund the bond.

We also carryout regular audits of the bonds held in the trust account every 12 months and seek to refund the money if its due to the landowner or the builder.

– Shire of Peppermint Grove manager corporate services Paul Rowlings

 

City of Stirling

Kerb security deposit: $1500 (more if verge contains street trees)

Current kerb security deposit holdings: $3.5 million

Amount held more than 24 months: Not provided

Reminder provided: Yes

The City regularly reviews bonds held by the City at the expiry of the permit (generally 2 years).

If the development has been completed the City will directly contact the verge permits applicant and advise them of the bond held by the City.

– City of Stirling manager health and compliance Peter Morrison

 

Town of Cottesloe

Kerb security deposit: $1500

Current kerb security deposit holdings: $695,000

Amount held more than 24 months: $613,000

Reminder provided: Yes

Residents are prompted to apply for a refund.

Once the Town receives a notice of completion for building works, a pre-completed infrastructure bond refund form is sent to them.

– Town of Cottesloe spokeswoman

 

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