We have released a revised Technical Paper on modelling local infrastructure contributions in a present value framework.
What has changed?
The purpose of this update to the Technical Paper is to improve clarity for councils seeking to use the NPV approach in cases where they are:
- revising or updating an existing contributions plan or
- making a new contributions plan in a precinct where development is already underway or where development approvals have already commenced.
This update does not represent a change to IPART’s current approach but clarifies that councils should update their net present value model when their contributions plans are reviewed, and the model should be adjusted to ensure that accurate apportionment is maintained. That is, where infrastructure costs have escalated faster than originally modelled and anticipated, future developments should continue to only contribute their portion of the escalated costs and not the entire escalated costs. The same principle applies when costs have escalated slower than originally modelled.