Mr PALLAS (Tarneit) — The  adjournment matter I raise is for the Minister for Planning,  and the action I seek is that he review the situation that has arisen for  landowners in Wyndham as a  result of  recent changes  to the  urban growth boundary in  the area  and in so doing provide  advice regarding  what, if  any, action he  intends  to take  to  address  the potentially  substantial  land tax increases that are likely to occur.

Approximately 300 properties across the northern and western parts of the  urban areas  of Wyndham have  experienced valuation increases averaging  about 168 per cent since the inclusion of this land within the  urban growth  boundary in July 2010.  This  change  in valuation followed the rezoning of the land  from  green wedge to urban growth, and  as a result of this  the council has had significant community protest and unrest directed at it in response to the impact on rates.

The  City  of Wyndham already  provides the most  generous  differential rate to property owners of  any growth area council in the urban growth zone — about 90 per cent  of the general rate. At  the same time the  Growth  Areas Authority is producing precinct structure plans  (PSPs)  for  all of this area and intends to have this work concluded by the end of 2013.

These growth corridors can  provide about  30 years land supply or 100 000 lots. Landowners  are seeing  substantial  increases in property  values that are  not realisable at the present time, even if  the PSPs were approved, and  in a great number of cases they will not be realisable for decades to come. There are not a lot  of  land sales happening  in  this area at the  moment,  so the problem  is between asset valuation and land tax liability at the point of the uplift value. The State Revenue Office is exempting primary producers in those areas from land tax only until such time as a PSP has been approved.

Even if the PSP cannot be acted upon for decades, the financial impacts  of land tax are far greater than council rates, and there are many properties within the area  that meet the  classification  of primary producer.  Council does not have specific numbers on how many properties maintain a primary  producer status, but it is not insubstantial.

In considering the action I have asked of the minister, Wyndham City Council has identified a  number of potential solutions.  Rezoning the land to  urban growth zone and then immediately proceeding  to produce and  approve precinct structure plans  and  a  developer  contribution plan is sending the wrong message to  the market  about  realistic  development  time  frames  and  therefore  potentially artificially  inflating  land  prices. It  would  be  better  to  sort  out what constitutes 10 years of land supply and, more importantly, what  is  beyond  the 10-year time frame and then send a stronger message to the market.

This would involve different processes for final approval  of precinct structure plans —  for  example, separating  approvals  from the formal  adoptions, using different zones inside the  urban growth boundary and looking at establishing an independent expert advisory body to make determinations and advise government.

See Tim’s speech in Hansard here.