Monday 19 May 2008

Building permits worth €150m to council

MORE THAN €150 million has been paid by developers to Dublin City Council for permission to build in the city since the development contribution scheme was introduced in 2004, new figures from the council show.

The scheme, introduced by the Government under the planning acts, allows local authorities to attach a condition to the grant of planning permission requiring a developer to pay a contribution for public infrastructure and services, such as roads or water mains, which benefit the development.

Last year the rate of contribution sought by the council was €13,908 per residential unit, or €132 per square metre in commercial developments. The council earned just over €51.6 million from these contributions last year and has earned closed to €153 million since the scheme began operating in January 2004.

Despite a slowdown in the construction industry, the council's finance department said it still expects to take in €168 million in the next three years, an average of €56 million a year, and has already allocated all the funds to capital projects - road construction, water and drainage schemes, urban regeneration schemes, parks and amenities and community facilities.

In a report to councillors, head of the finance department Kathy Quinn said the total cost of these projects for the next three years was in excess of €2 billion. Government funding and the council's own earnings would not cover this cost. The development contributions of €168 million were essential to the funding of projects and even with this funding the council was still facing a deficit of almost €29.5 million.

Any additional projects requiring funding which might arise over the next three years would require very careful consideration because of "scarce capital resources", Ms Quinn said. She noted that the changing economic conditions were likely to have an impact on the level of development contributions the council would receive.

The council is seeking greater independence from central Government in relation to its finances and is making a submission to the commission on taxation on this basis. The council is seeking a share of income tax, stamp duty and VAT generated in the city, as well as the power to levy rates on government buildings, schools, universities and hospitals and to introduce a hotel bed tax.

Dublin Chamber of Commerce has said it is opposed to an increase in business taxation and any new local taxation measure that would make the city and region more expensive for visiting tourists or shoppers. However, its chief executive Gina Quinn said the chamber does support the call for the levying of rates on government buildings, and for the State to bear the full economic cost of providing domestic water and emergency services such as fire and ambulance services.

"If all of the Government-occupied properties in the city were subject to commercial rates, just like businesses are, then City Council's annual revenue would increase by approximately €27m," she said.

Irish Times

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