Developer charges

Developer charges are up-front charges levied to recover part of the infrastructure costs incurred in servicing new developments or additions/ changes to existing developments.

NSW Local water utilities levy developer charges, pursuant to section 64 of the local Government Act 1993, by means of cross-reference to section 306 of the Water Management Act 2000.

Developer charges are an integral part of fair and cost-reflective pricing for water supply and sewerage services. It is a requirement of the National Water Initiative Pricing Principles 2010.

NSW local water utilities are expected to prepare water supply and sewerage Development Servicing Plans (DSPs) and levy commercial developer charges in accordance with the 2016 Developer Charges Guidelines.

However, utilities with low growth (under 5 lots/annum) are eligible for an exemption from preparing a DSP. A utility with such low growth may request exemption from the department.

2016 Developer Charges Guidelines

The 2016 DCG for Water Supply, Sewerage and Stormwater (PDF, 4362.04 KB) have been approved by the Minister for Lands and Water pursuant to section 306 (3)(C) of the Water Management Act 2000. These guidelines modify and supersede the Water Supply, Sewerage and Stormwater Developer Charges Guidelines, 2002 and incorporate feedback and recommendations from the industry consultation.

Preparation of all Development Servicing Plan documents commenced after July 2016 must be in accordance with the 2016 guidelines. A Development Servicing Plan documents all the relevant information used to calculate the developer charges. The guidelines define requirements and provide guidance on preparation of a development servicing plan (DSP) document, analysis, audit, implementation and administration of appropriate developer charges to ensure that new development meets a fair share of the cost of service provision.

A key requirement of the 2016 guidelines is an independent audit of the DSP document. Local water utilities are also required to register their DSPs with the department.