Councils fail to provide rate exemptions for affordable housing

Melbourne City Council candidates have announced a ‘new’ policy plan of giving rate relief to developments that incorporate a minimum portion of affordable housing.  On its own, that seems like a good idea.  And the proposed rate relief will hopefully motivate the construction of new affordable housing.  But the concept of rate exemptions for affordable housing is not ‘new’.  And existing laws are being ignored.

Many councils are presently declining to give a rating exemption to affordable housing owned by registered housing providers – despite the fact that Victorian legislation appears to grant an exemption.  There is no good reason for this position.

Section 154 of the Local Government Act 1989 deals with rate exemptions.  It grants an exemption to land which is “used exclusively for charitable purposes”.

Clearly the provision of social and affordable housing is a charitable use of land.  Every registered housing provider in Victoria is required to be a registered charity (most are tax-deductible Public Benevolent Institutions).

There is one category of housing that does not get the exemption under the Act – a house or flat on the land which is:

  • used as a residence; and
  • is exclusively occupied by persons including a person who must live there to carry out certain duties of employment.

Most ordinary people will read this as a ‘carve out’ for a dwelling where at least one of the occupants is required to live in the residence in order to carry out employment duties.  Examples might include a house used for drug rehabilitation which includes a ‘lead tenant’ employee; a Specialist Disability Accommodation which includes a live-in carer.  It seems anomalous to exclude these types of arrangements from the charitable exemption.

But the Act does not exclude social and affordable housing from a rate exemption.  In fact, the Act gives a rate exemption to affordable housing.  Many Councils are simply ignoring the Act.  If Councils want to give a boost to affordable housing, they could grant the rate exemption and they could do it today.

Giving effect to existing laws by granting rate exemptions would free up millions of dollars in the housing sector, which could be used to generate more housing.  Housing solves homelessness.

Andrew Boer, Practice Leader and Kate Drummond, Senior Lawyer at Moores 

Bendigo calls for input into affordable housing

The City of Greater Bendigo is calling for community input into its Affordable Housing Action Plan.

The council wants to better understand affordable housing needs in Greater Bendigo so it can address the growing shortage of affordable housing shortage, including utilising mechanisms to increase the supply of well-designed and efficient affordable housing.

The council has released a paper for public comment.

Click here to read the background paper and provide comment via a short survey.

Joint venture to boost social housing in Hepburn

The Hepburn Shire Council is partnering with national not for profit housing provider, Community Housing Limited (CHL) as part of a joint venture program that will increase the number and quality of social housing dwellings within the region.

Locals in housing need or those facing the risks of homelessness will benefit from the program, which will provide safe and appropriate housing in the form of 19 dwellings.

With grant funding provided by the Hepburn Shire Council in the amount of $589,000, CHL will deliver four (4) new purpose-built double bedroom units to low income earners in the Clunes community.

‘This program will not only increase the supply of social and affordable housing in the Shire of Hepburn, which is so desperately needed, but will greatly improve the quality of life for struggling residents providing them with real opportunities and pathways,’ says CHL State Manager Shari McPhail.

As part of the CHL’s management, tenants will reap the benefits of services that will connect them with employment, education, training and other community engagements opportunities.

‘We are totally committed to serving the community, and we are really looking forward to working within the region and with the council. Not only will this project provide much needed housing options, but it will also contribute to the local economy with a host of employment opportunities both long and short term, expected to be generated.’

A tender invitation for the construction of the new units is expected to be released shortly, with CHL encouraging local builders and trades within the Clunes Community to partner in the delivery of this very exciting project.

Mayor Cr John Cottrell said that Council was pleased to be working collaboratively with Community Housing Limited.

‘Affordable housing is an issue facing all communities and this is a great opportunity to make a difference in Clunes. The funding raised by Council together with the Clunes community will deliver additional housing options and real opportunities for low income earners.’

Upon completion in the second half of 2019, the new properties will be made available as housing options for the elderly, key workers and younger people, and via CHL will be coupled with resources and support to allow them to engage with their community, develop support networks and grow and lead productive lives.

For almost a quarter of a decade, CHL has been managing the end to end delivery of affordable housing including design, construction, tenancy and property management and currently has more than 9,000 properties under its management nationally, of which over 15 percent are in Victoria.

 

Why LGAs should work with CHOs

The new planning mechanisms for affordable housing came into effect on 1 June 2018 as a result of amendments to the Planning and Environment Act 1987.

CHIA Vic has created a factsheet for local government detailing how they can increase affordable housing in their municipality by working in partnership with community housing organisations.

Download your copy here.