Scarborough landowners concerned they will be hit up for tens of thousands of dollars in contributions to foreshore redevelopment


Philip Smith and Mike Needham are concerned about the potential contributions. Picture: Andrew Ritchie d464270
Philip Smith and Mike Needham are concerned about the potential contributions. Picture: Andrew Ritchie d464270

SCARBOROUGH landowners are concerned they will have to pay tens of thousands of dollars for a development contributions plan to recoup money for the Scarborough foreshore redevelopment.

The Metropolitan Redevelopment Authority (MRA) has reassured Scarborough landowners they will not have to pay contributions unless they subdivide or redevelop, but a group of residents think a clause in the document will mean otherwise.

In December, the City of Stirling recommended several changes to the plan, including the removal of the clause it says will make people liable to pay contributions when the plan expires in 15 years.

The draft Scarborough Development Contributions Plan (DCP), which is out for public comment until February 15, involves residents from Kay Street to just north of Pearl Parade and inland to Hinderwell Street.

A group of residents plan to distribute 2000 flyers about the plan after the MRA sent letters to affected households earlier this month about the plan.

Landowner Mike Needham said he was concerned about what would happen if he sold his Scarborough unit.

“If I sell my modest unit I’ll be up for 20 grand and I do want to sell it within 15 years,” he said.

“The MRA’s advice is that the contribution is not required until an owner’s land is redeveloped, but the currently worded draft plan requires payment on expiry of the scheme (in 15 years) whether or not the owner’s land has been redeveloped,” he said.

However, MRA chief executive Kieran Kinsella said a contribution payment would be triggered only when a development or subdivision application was approved.

“Landowners who choose not to develop their land will not be affected,” he said.

“The DCP will recoup a portion of the State and local government investment within the area from land owners who benefit from the public infrastructure upgrades.

“It is important to note that minor works and developments, which may include construction of a new single dwelling and small-scale alterations or additions to existing properties, are not required to pay a development contribution.”

Scarborough property developer and real estate agent Phillip Smith said he calculated he might have to pay a $48,865 contribution for his strata unit.

“I thought the State Government via the MRA was funding the Scarborough redevelopment,” he said.

“This will fly under the radar; the average person will put this in the too hard basket.”

The City report said the plan, particularly the liability clause, could cause “hardship” for some owners.

It noted it was likely some sites would not be subdivided or redeveloped before the contributions plan expired in 15 years and planning control was handed back to the City.

“For these sites, interest will accrue on any contributions not paid to the MRA,” the report said.

“This may cause hardship for some owners particularly if they do not intend to (or are unable to) redevelop in the foreseeable future.”

It was recommended that this clause be expanded to address the liability for these cases.

The document is open for public comment on the MRA website until February 15.