What does it mean when your property is in a ‘Growth Area’ and what is a ‘Growth Areas Infrastructure Contribution (GAIC)?

Welcome to the “Frequently Asked Planning Questions: Conveyancers and Solicitors Edition” blog series, where we dive into those often-tricky planning questions that come up when we’re working with the brilliant Conveyancers and Solicitors we partner with.

Here at AS Planning, we’re all about teamwork, and we regularly help you and your clients navigate the sometimes-complex world of planning in across Victoria. Ever find yourself scratching your head over a particular planning scenario? You’re definitely not alone! We’ve compiled some of the common questions we encounter that we hope will be a real asset to you and your firm in minimising risk, streamlining property transactions and adding value for your clients.

Engage AS Planning for professional support in navigating planning matters, strategic planning advice, and preparing and lodging applications. Request a quote today.

Example Planning Question:

“The Section 32 for a property in a designated ‘Growth Area’ mentions a ‘Growth Areas Infrastructure Contribution (GAIC).’ What exactly is this, and who is liable for it?”

Example Scenario:

Your client is purchasing a newly subdivided block of land in Nar Nar Goon, a rapidly expanding outer eastern suburb of Melbourne. The Section 32 mentions a potential GAIC liability. My client is unsure what this contribution is for and whether she will be responsible for paying it now or in the future.

Planning Perspective Considerations for Growth Areas Infrastructure Contribution (GAIC):

Growth Areas Infrastructure Contributions (GAIC) are charges levied on land in designated growth areas to fund essential infrastructure like roads, schools, parks, and community facilities needed to support the growing population.

Key Considerations:
  • Liability: Typically, the owner of the land at the time of a trigger event (often the first residential construction) becomes liable for the GAIC. However, the specific arrangements can vary, and sometimes the vendor might have already paid a portion.
  • Trigger Events: Common trigger events include the issue of a building permit for a residential dwelling or further subdivision of the land.
  • Contribution Rates: GAIC rates are set by the Victorian State Government and can vary depending on the location and the type of development.
  • Disclosure in Section 32: Sellers are legally required to disclose any potential GAIC liability in the Section 32. However, understanding the timing and amount of the contribution can be complex.
  • Impact on Development Costs: Buyers need to factor potential GAIC payments into their overall development costs.

Ensure your clients understand their potential GAIC obligations and how these contributions work.

Contact AS Planning today for planning advice, and support with planning application preparation and lodgement.