The District Council of Mount Barker Community Waste Management Scheme Infrastructure Fee Policy Page 1 of 6 14.3 TITLE: COMMUNITY WASTE MANAGEMENT SCHEME INFRASTRUCTURE FEE INTERIM POLICY RESPONSIBLE DEPARTMENT: INFRASTRUCTURE AND PROJECT ASSOCIATED POLICY, LOCAL GOVERNMENT ACT 1999 PROCEDURE(S) AND LEGISLATION: New Tax System (Goods and Services Tax) Act 1999 ASSOCIATED DELEGATION(S): AS PER COUNCIL’S REGISTER OF DELEGATIONS DATE OF LAST REVIEW BY COUNCIL 21 September 2009 REFERENCES CODE FOR ESTABLISHING AND APPLYING PROPERTY UNITS ;LOCAL GOVERNMENT ASSOCIATION OF SOUTH AUSTRALIA 1. PURPOSE The purpose of this policy is to ensure that Council administers the Community Wastewater Management Scheme Infrastructure Fee in a fair and consistent manner pursuant to Section 188 of the Local Government Act 1999. 2. DEFINITIONS A Connection unit: Means a unit used to calculate the fee, as defined in section 6 of this policy. Community Waste water Management Scheme: Means any system or scheme provided or made available by Council for the collection, treatment or disposal (including by recycling) and sale of wastewater and includes a septic tank effluent drainage scheme. CWMS: Means a Community Wastewater Management Scheme. CWMS Property Units Code: Means the Code for Establishing and Applying Property Units as a Factor for the Imposition of Annual Service Charges for Community Wastewater management Systems published by the LGA on 20 April 2006. LGA: Means the Local Government Association. Maintenance: Regular ongoing day–to-day work and operations necessary to keep a CWMS operating. Example: pipe cleaning, treatment of wastewater and operating costs including electricity charges. The District Council of Mount Barker Community Waste Management Scheme Infrastructure Fee Policy Page 2 of 6 New: Is the creation of a new asset to meet additional service level requirements. Example: a new pumping station. Upgrade: Is the enhancement of an existing asset to provide a higher level of service. Example: increase in pipe diameter to increase capacity for flow rates. 3. BACKGROUND Where a property owner connects to the CWMS, Council has applied a Developer Contribution (connection) fee. This fee is not tied to the actual operational and maintenance costs incurred by Council of providing the service, but is used by Council to provide for development, expansion (new estates) upgrading and renewal costs associated with the treatment and the disposal of the treated waste water that would result from the cumulative impact of new connections to the CWMS network. This fee is payable once only. The operational and maintenance cost associated with the general management of the CWMS is separately provided for by the Council’s annual CWMS service charge. This amount is determined annually and applied as part of the Council’s rating process. 4. OBJECTIVES The objectives of this policy are to ensure that: • Council administers the Community Wastewater Management Scheme Infrastructure Fee in a fair and consistent manner; • Council achieves the required future funding capacity for the increased needs of the CWMS as the district population grows; • As new users are connected to the network a CWMS Infrastructure Fee is applied to ensure intergenerational equity; • The CWMS Infrastructure Fee is maintained at an appropriate level to account for increases in construction and renewal costs and future CWMS Infrastructure needs; • Council complies with all regulatory requirements associated with CWMS. 5. POLICY PRINCIPLES The following principles reflect Council’s commitment to maintain high standard of service delivery from the CWMS network meeting future needs. 5.1. The name of the fee: Is the “CWMS Infrastructure Fee“ to reflect that the income is for development expansion (new assets), upgrading and renewal not for maintenance and operational costs. The District Council of Mount Barker Community Waste Management Scheme Infrastructure Fee Policy Page 3 of 6 5.2. Where the fee applies: In all townships that have CWMS available and where new allotments are created or existing allotments not connected to the scheme are to be. 5.3. When the fee is applied: The fee will be applied on application to connect into the CWMS, a connection being defined as per section 6 of the policy. 5.4. How the fee is applied: The fee will be applied per a Connection Unit as defined in section 6. 5.5. Use of funds: The funds generated from the CWMS Infrastructure Fee are to be used for future development, expansion (new assets), upgrading and renewal of the CWMS for the treatment and disposal of the waste water. They may also be used for research and development of the CWMS in accordance with councils budgeting process. These funds are not for general operating or maintenance of the CWMS, or the supply of CWMS collection networks within new green field developments. 5.6. Reserve funds: Cash funds generated from the CWMS connection fee shall be retained by council in a CWMS Infrastructure Fee Reserve together with any interest accrued. 6. A CONNECTION UNIT 6.1. Residential allotments: One residential residence = one connection unit. A residential dwelling comprises a single household occupancy whether a flat, unit, semi-detached, row cottage or separate dwelling occupied or vacant. 6.2. Commercial premises (one occupancy per building): For example: shops, offices (including Government offices) or private agencies. The number of connection units is to be calculated per individual occupancy/tenancy as follows: FTE 6 Where: FTE = the total number of full time equivalent employees (not living on the site). In line with the LGA code for Establishing and Applying Property Units. The denominator figure 6 reflects the limited (working) hours during which facilities are used by employees compared with the domestic situation. The District Council of Mount Barker Community Waste Management Scheme Infrastructure Fee Policy Page 4 of 6 6.3. Vacant land: Not subject to the fee – existing vacant allotment comprises any vacant parcel of land held under separate title, capable of sale without requiring approval for division and is able to be connected to the CWMS network. 6.4. Retirement villages: Due to higher than normal density housing, the following discount to the fee will be applied. This discount fee is based on the ABS Census data showing the average household occupancy to be 2.6 people per household1 (Mount Barker district). This number therefore represents the average residential number for a connection for this policy. The expected maximum occupancy of this type of residence being retirement village accommodation, is two people. The formula to determine the number of connection units per tenancy = (expected maximum occupancy / the average household occupancy of Mount Barker District) = 0.77 The CWMS Infrastructure Fee for each tenancy in retirement villages would be discounted to be 77% of the connection unit. 6.5. Hospital, Nursing or Rest Home or other similar occupancy: The number of connection units will be calculated based on the following formula FTE + BEDS 6 Where: FTE = the total number of full-time equivalent employees (not living on the site) BEDS = the number of accommodation beds. 6.6. Hotel, motel or similar occupancies: The number of connection units is to be calculated as follows: FTE + (BEDS x 0.7) 6 Where: FTE = the total number of full-time equivalent employees (not living on the site) 1 ABS 1345.4 - SA Stats, Jul 2008 New dwelling approvals in South Australia The District Council of Mount Barker Community Waste Management Scheme Infrastructure Fee Policy Page 5 of 6 BEDS = the number of accommodation beds. Note: The use of 0.7 in the formula is an assumed occupancy rate. (Reference LGA codes for Establishing and Applying Property Units.) 7. THE CWMS INFRASTRUCTURE FEE 7.1. Application: The CWMS Infrastructure Fee will apply to the land owner per connection unit on application to council for the land to be connected to the CWMS. The number of connection units per property usage is as defined in section 6. 7.2. Good and Service Tax: The CWMS Infrastructure Fee is exempt from the goods and service tax in accordance with Division 81 of A New Tax System (Goods and Services Tax) Act 1999. 7.3. Pricing mechanism: Council will adjust the amount of the fee every six months at the first of January and the first of July based on Australian Bureau of Statistics Stage of Production Formula: Adjusted price = A x C / B Where: A = the amount of the fee immediately prior to the adjustment date. B = the value of the Index as first published for the March quarter prior to the most recent past price adjustment C = the value of the Index as first published for the most recent September quarter prior to the adjustment date 7.4. Payment: The payment of the CWMS Infrastructure Fee will be due and payable within Council’s thirty day trading terms. 8. RESERVE FUNDS MANAGEMENT 8.1. Administration: The CWMS Infrastructure Fee reserve will be administrated by council. The projects designated to be funded from the reserve will be identified during the council’s budget process. The administration shall transfer funds to the council’s bank account monthly, ensuring that these projects are funded by the CWMS infrastructure fee. The cash receipts of the CWMS Infrastructure Fee shall be deposited to the reserve at the end of each calendar month. The District Council of Mount Barker Community Waste Management Scheme Infrastructure Fee Policy Page 6 of 6 8.2. The Reserve: The cash balance of the reserve will be held at the Local Government Finance Authority. 8.3. Interest: Shall be applied to the reserve based on the minimum monthly balance at the current interest rate of the Local Government Finance Authority at that time. 8.4. Reporting: The administration of the reserve shall report to council on a quarterly basis and be published in the annual financial statements. 8.5. Audit: of the reserve will occur as part of the annual external audit process 9. RESPONSIBILITY 9.1. Council Administration Role Council administration shall: • maintain and update reserve funds • meet all legislative requirements for the accounting for funds raised by the fee, to the satisfaction of internal and external audit • implement this policy • Monitor the effectiveness of this policy and recommend to council any proposals. 10. REVIEW DATE This Policy is intended to be an interim policy to be reviewed on the completion of the CWMS Strategic and Business Plan or within twelve months of being adopted by council which ever is the sooner.
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