Index-linking of development charges was sought by Offaly County Council executive
OFFALY councillors have once again rejected a proposal for a further hike in development charges.
While they gave the go-ahead for the levies to go up at their January meeting, they shot down a second attempt to link them with increases in inflation.
Proposals to increase the charges – which are incurred by those involved in residential and commercial development - in line with inflation were put forward by council management and received the backing of Cllr Mark Hackett.
The Green Party councillor from Geashill said council staff had “spent months” working on their proposals and they were trying to match revenue with outgoings.
“If we don't match with inflation we're shooting ourselves in the foot. We're running Offaly County Council into the ground,” said Cllr Hackett. “I feel we shouldn't do that, we should be responsible.”
He said index-linking the charges would result in a “small increase” where the average house build was costing €200,000.
The charges have not been increased since 2013.
The impact of the increase was spelled out by council director Ann Dillon who said it would see the charge per residential dwelling go up from €3,010 to €4,310.
In nine towns (Tullamore, Birr, Edenderry, Clara, Ferbane, Daingean, Kilcormac, Banagher and Portarlington), a new additional charge of €1,000, to defray costs of surface water management, has been introduced and it is not subject to index-linking.
The charge for industrial and commercial development is levied per square metre. It was fixed at €14 in 2013 and last year's proposal envisaged an extra €1, bringing it to €15, with index linking for inflation moving it up to €21 per square metre.
In the nine towns mentioned, a €3 charge per square metre is being added for surface water costs.
The council is applying surface water charges because of a decision by Irish Water.
The IFA opposed the imposition of increased charges on agriculture, horticulture, forestry or equestrian activities.
The submission from the farmers' organisation was rejected by council management who said agricultural development is a business “and places a demand on infrastructure, especially rural roads” and should continue to attract development charges.
While there was no comment from councillors at their January meeting on the IFA call, several voiced their opposition to index-linking.
Cllr John Leahy, Independent, said the idea had been rejected in November.
“We felt it was too much too quick,” said the Kilcormac councillor.
“I do bear in mind that retrospectively we should have looked at it and going forward do it every year but we decided not to, given the times we're in.”
Cllr Liam Quinn, Fine Gael, said he could see the logic of the proposed increase but it would lead to a “fairly substantial increase” for one-off houses in particular.
“I think what's agreed is balanced. I know it's not perfect,” said the Rhode man.
There was no seconder for Cllr Hackett and on the proposition of Cllr Leahy, seconded by Cllr Frank Moran, Fianna Fail, the development charges were adopted without the index-linking increase.
The new development contribution scheme will be in place for five years from 2021 to 2025.
Councillors were told last year that chartered surveyors said costs had risen 48% since 2013, hence the proposal to index-link the new charges.
The adopted scheme includes a new charge of €23 per square metre for data centres.
Income from development charges was only €396,000 in 2015 but jumped dramatically to €2.265m in 2016, before dropping to €949,000 in 2017, €729,000 in 2018 and €702,000 in 2019.
It rebounded in 2020 and amounted to €1.5m at the end of September but half of that figure was from one development, a Bord na Mona wind farm.
Councillors were told the charges form a crucial income stream for the council for spending across a range of areas from land acquisition, roads, car parks, waste and water works, to open spaces, recreational and community facilities and broadband.
Council planners estimated that infrastructure costs between 2021 and 2025 would be €23.5m.
The council said last year it planned to spend nearly €1.6m on repairing road bridges, €6m on the Kilbeggan-Tullamore link road, €1m on the Edenderry inner relief road, €1m on the road between Rochfortbridge and Rhode, and €900,000 on Grand Canal greenway work.
Another €2m was budgeted for the library and arts centre in Edenderry, €1m on the Tullamore arts centre and €3.7m on the surface water network.
The revamp of O'Connor Square in Tullamore benefitted from €1.5m in funding from the scheme.
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