Development Contributions Policy

Development contributions are the levies charged by Council that go towards paying for the additional cost of community and infrastructure needed as a result of development on our peninsula. If you are planning a subdivision, an extension to a property or a property development, you may need to pay a development contribution to Council.


The Local Government Act 2002 gives Council the power to use development contributions as a way of funding growth-related capital expenditure and it sets out the requirements for development contribution policies like the one Council has.

Development contributions may be payable on any new development or subdivision or when applying for a building consent or service connection.

The key purpose of the Development Contributions Policy is to ensure that growth, and the cost of infrastructure to meet that growth, is funded by those who cause the need for that infrastructure. Development contributions are not a tool to fund the cost of maintaining infrastructure or improving levels of service. These costs are met from other sources.

What are development contributions?

Development contributions are essentially the repayment of money advanced by Thames-Coromandel ratepayers to fund new infrastructure. As a ratepayer, your rates fund the existing infrastructure you need - the roads, water and wastewater infrastructure, parks and community facilities. Rates also allow Council to borrow money for new infrastructure required by new homes and new or expanded commercial premises. Our Development Contributions Policy ensures that the ratepayer is repaid. Development contributions only fund the growth component which is the extra infrastructure, services and amenities that new developments require. Council funds those costs in the interim but expects to recover these advances through development contributions. It is a policy approach that both assists the growth of the peninsula and is fair and equitable to ratepayers.

The following documents explore why development contributions are needed, what they fund, when they need to be paid and what you are likely to pay.

Development Contributions brochure

This is a guide to the Development Contributions Policy.

Development Contributions Policy - June 2021

This is Council's policy that sets out the principles, purpose and triggers for taking a development contributions under the Local Government Act 2002.

Development contributions calculation form

This is a form that can be used to calculate development contributions

Schedule of assets

This is a schedule of the capital projects that have been budgeted for and shows the percentage that will be funded by development contributions.

Development contributions - frequently asked questions

This is a list of the most common questions and answers asked about development contributions.

Development Contributions FAQ

What is a Development Contribution (DC)?

A payment made by a developer to cover part of the costs of providing infrastructure to a new development. A Council may require a development contribution to be made when granting a resource consent, a building consent, a certificate of acceptance or an authorisation for a service connection.

What is Infrastructure?

The stock of fixed capital equipment that helps a community to function. This includes the pipes and machinery that allow councils to collect and manage water, wastewater, stormwater and rubbish, as well as assets such as roads and buildings.

How do you know when a development contribution is payable?

In general you will pay a development contribution when you cause any additional demand on our services or benefit from those services when:

  • creating additional lots by subdivision, including the subdivision or cross lease of an existing lot
  • building additional dwellings on a lot
  • extending the area of business activity on a business lot
  • extending the area of any other activity such as schools, churches, hospitals or clubs; or
  • obtaining a new or additional service connection.

A development contribution will be payable by each additional “unit of demand” created by development activity for the services provided in the area or “catchment” in which it falls.

What is a ‘unit of demand’?

The Development Contributions Policy (DCP) considers any new dwelling or any new residential, business or rural lot created in a subdivision as one additional ‘unit of demand’ for services.

The DCP also contains formulas which use the ‘gross business area’ of any additional commercial or industrial development or the ‘gross floor area’ of any other activity such as schools, churches, clubs and hospitals, to calculate the units of demand generated by those business or other activities.

A new unit of tourist accommodation or a motel/hotel unit of two or more bedrooms is treated as having one unit of demand like a normal dwelling.

Smaller tourist and motel/hotel units of one or less bedrooms are treated as having half a unit of demand.

In requiring a development contribution, we will give credits for any unit of demand in existence at the time the development or subdivision takes place because it deems this to have paid its contribution already*.

For example:

If a dwelling (one new unit of demand) is built on an existing residential lot (one existing Unit of Demand), then no contribution is payable, the residential lot being deemed to have paid a contribution when it was created. (Hence 1 new minus 1 paid = 0)*

If two dwellings (two new units of demand are built on an existing lot (one existing Unit of Demand), then one contribution is payable. (2 new minus 1 paid = 1)*

* with the exception of water and wastewater contributions where only existing lots or developments already connected to water and wastewater networks are deemed to have paid contributions in the past.

How are development contributions calculated?

Development contribution amounts originate from the 10-year capital costs in the Ten Year Plan. We calculate that part of total capital expenditure in the 10-year programme that is being caused by or is of benefit to new development and growth. We then divide this expenditure by the amount of development that is expected to take place.

Development contributions cannot be used to fund the costs of renewing or replacing infrastructure to ensure existing development enjoys the correct levels of service.

From 8 August 2014 development contributions on new consent applications will no longer be required for Council projects relating to libraries, airfields, swimming pools, harbour facilities, infrastructure on parks/reserves or cemeteries where these projects have not commenced. However, they will continue to be collected on existing or substantially progressed infrastructure projects.

Are contributions different depending where the development is occurring?

The contributions payable for any new development or subdivision will depend on where the activity is situated.

Development contributions towards a particular project should only come from development that is causing that project to be undertaken or will benefit from it.

For example, it would be unreasonable for new development in Thames to pay toward a stormwater project in Whitianga.

The DCP uses a number of service areas or ‘catchments’ to which expenditure is allocated. Only development taking place within a particular catchment will pay toward that expenditure. Catchments range in size depending on the types of service.

For example:

  • There is a single district-wide transportation catchment. Any new development in the District, wherever it is located, gives rise to the need for capital expenditure on the District transportation network as a whole and should contribute toward it.
  • There are a number of community board area catchments. These are used to assign the costs of works undertaken to deal with growth in particular parts of the District such as community transportation works, halls, and play equipment on neighbourhood reserves.
  • There are a number of local settlement catchments for services like wastewater, stormwater and water supply. These small catchments are used to assign the costs of works only to those developments that connect to a particular scheme. In general, a subdivision in a rural area will pay district-wide and Community Board contributions but will not pay toward water, wastewater or stormwater services which are usually confined to the urban settlements.

How do I calculate my development contributions?

Please contact Council's Duty Planner on 07 868 0200 for a draft calculation of development contributions payable.

Will a reserve contribution also be payable?

Reserve contributions are only payable on residential activities occurring in urban residential zones, including the Coastal Village, Coastal Residential and Rural Village zones in the District Plan. These contributions pay for local reserves in urban settlements in the District.

For consents granted prior to 1 July 2015, one residential unit of demand will pay a reserve contribution amounting to the average market value of 20m2 of land of all lots created by a subdivision or of all lots on which a residential development is occurring.

The value of the land is determined by a registered valuer appointed by the Council and a fee is payable by the applicant for the valuation to be done.

For consents applied for and accepted by Council after 1 July 2015, the reserve contribution if any will be a component of the contribution levy.

Please note that this does not replace a requirement for reserves under Council's Operative District Plan where directed by a structure plan.

When must the development contribution be paid?

A development contribution assessment will be made when a resource consent or building consent application is completed or when a service connection is authorised.

The development contribution is payable:

  • in the case of a land use consent, before the activity commences
  • in the case of a subdivision consent, before a Section 224 completion certificate is issued
  • in the case of a building consent, before the first building inspection takes place
  • in the case of a Certificate of Acceptance, upon the granting of the Certificate of Acceptance
  • in the case of a service connection, before the service connection is made.

Please contact customer services if you need help or if you have any questions.