Development Contribution Waiver Scheme: Read all about it!

Background

The Temporary Development Contribution Scheme (the Scheme) was a measure introduced by the Government earlier this year under Housing for All Action Plan.

Its purpose: to reduce construction costs and to promote the supply of new housing.

How does it work?

If a development qualifies for the Scheme, the owner/developer will not be obliged to discharge any development contributions[1] payable on foot of the relevant permission. In addition, while an owner/developer will be required to discharge water and wastewater connection fees in full, under the Scheme an owner/developer is entitled to seek a refund from Uisce Éireann (UÉ).

What developments qualify?

The Scheme will apply to:

1. All permitted residential developments which includes multi-unit developments, self-build houses, one off rural houses, student accommodation and sheltered housing;
2. Where:

• works commence on site between 25 April 2023 and 24 April 2024;
• a commencement notice is submitted to the local authority within the 28 day period prior to 25 April 2023 i.e. on or after 28 March 2023 or 7 day notices were submitted to the local authority on or after 4 April 2023; and
• the works are completed no later than 31 December 2025

How do I apply for the Scheme?

Development Contributions:

In order for an owner/developer (the Applicant) to qualify for the Scheme, the following steps will need to occur:

Step 1: The Applicant will need to submit a Development Contribution Waiver Scheme Application Form to the relevant local authority together with the commencement notice in respect of the development for which the waiver is sought (the Application Form).

Step 2: On receipt of the Application Form, local authorities will assess whether the development qualifies for the Scheme and assign it a unique identifier number.

Step 3: Where a development is deemed to qualify for the Scheme, the local authority will issue a waiver approval letter confirming that the development has been approved for the Scheme (the Letter of Confirmation) and associated undertaking which requires the Applicant to confirm that they will comply with the conditions of the Scheme (the Undertaking).   

Step 4: The Undertaking is the Applicant’s acceptance of the Letter of Confirmation and must be signed in the presence of a notary public, a commissioner for oaths or a solicitor. The Applicant must return the Undertaking to the local authority within 2 weeks of the date of the Letter of Approval. The Undertaking will be held on file by the relevant local authority.

Step 5: The planning authority will then issue an approval letter confirming the Application Form has been successful and the amount of contributions waived (the Letter of Approval).

Water and wastewater connection:

It should be noted that UÉ are currently finalising the refund application process. It is envisaged that applications will be accepted shortly, and details will be made available on their website.

in the meantime, Applicants should note the following requirements will need to be satisfied prior to seeking an UÉ refund:

Step 1: Obtain a Letter of Confirmation

Step 2: Obtain a Letter of Approval

Step 3: Submit the Letter of Approval together with a:

• completed UÉ Connection Refund Application form[2];
• signed UÉ Connection Refund Letter of Undertaking[3]; and
• a valid commencement notice

Step 4: Applicants must have a valid connection offer from UÉ (Connection Offer);

Step 5: Have met all the associated offer acceptance criteria for the Connection Offer being:

• payment of full connection charges
• returned the signed counterpart of the Connection Offer
• met all surety criteria (where applicable) for the Connection Offer
• met all special conditions associated with the Connection Offer e.g. wayleave agreement

What happens if “the works” have not completed by 31 December 2025?

If the works have not completed by 31 December 2025 the local authority will issue an invoice to the developer seeking repayment of the full value of the development contribution waived.

It is unclear what will happen with applications for refunds to UÉ in the event that works have not completed by 31 December 2025, but the expectation is that the applications will be rejected, and no refund will be forthcoming.

Summary

While the introduction of the Scheme was welcomed, the practical implementation of the Scheme has not yet been tested at this stage. Workable and timely processes being put in place by the local authority and UÉ will be required for stakeholders to get the most out of the Scheme. 

 

[1] Section 48 of the Planning and Development Act

[2] Application form not yet published by UÉ

[3] Undertaking not yet published by UÉ

 

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