Developer contributions and the containments of urban expansion in Sydney.

Transport infrastructure in Sydney and NSW has traditionally been provided through Commonwealth, State and Local Government allocations and through developer charges and user pays charges. Over the last twenty years, there has been increased emphasis placed on the latter approach as Commonwealth and State sources become more scarce, and funding of the costs associated with service provision increases. User charges have enabled several privately funded toll roads to be built in Sydney over the past decade, generally with wide community acceptance. Developer charges in Sydney have mostly been restricted to local transport infrastructure, but with a few examples of contributions towards the cost of regional transport. There is now a need to look more closely at the benefits and disbenefits associated with the introduction of a regional contributions regime. This need stems from: (1) A rejection of public subsidisation of metropolitan expansion. (2) Micro-economic reform which seeks to increase overall public sector efficiency. (3) An increase in the private sector in the provision of public infrastructure and the acceptance of the user pays approach. (4) Constraints faced by the State in funding road and rail infrastructure with public finances due to the desire to limit State debt and slowing in the rate of growth of general revenue and the tax base. The benefits and disbenefits associated with the introduction of a scheme which levies proponents of development for contributions towards the costs of providing infrastructure and services for new urban development in Sydney are examined. It is concluded that the case for regional development contributions rests largely on the ability to retard the continued outward expansion of cities such as Sydney, and reduce the subsidisation of this less sustainable development. In this regard, the scheme is considered one of several demand management tools available to Government to contribute to a more efficient and equitable distribution of land use and trip making throughout the city. For the covering abstract see ITRD E124693.