If you're buying or developing property in New South Wales, your Section 10.7 Planning Certificate may include a reference to a Contributions Plan. These plans outline when and how developers or landowners may be required to contribute financially to local infrastructure, services, and amenities. Understanding what these contributions are, and how they might affect your development, is essential for budgeting and feasibility planning.

What is a Contributions Plan?

A Contributions Plan is a legal document prepared by a local council under Section 7.11 or 7.12 of the Environmental Planning and Assessment Act 1979. It allows councils to collect developer contributions—also known as infrastructure contributions, developer levies, or section 94/94A contributions (previous naming conventions). These contributions are used to fund:

• Roads and traffic facilities
• Parks and playgrounds
• Drainage and stormwater works
• Community centres and libraries
• Public open space and landscaping
• Other local infrastructure needed due to population growth

Types of Contributions Plans

There are generally two main types:

1. Section 7.11 Contributions (formerly Section 94)
   These are calculated based on the increased demand a development places on local infrastructure. For example, if you're building five townhouses on a site where one home previously existed, the council may require contributions for the additional four dwellings.
2. Section 7.12 Contributions (formerly Section 94A)
   These are fixed percentage-based levies applied to developments, regardless of their specific impact. Usually expressed as a percentage of the estimated development cost (typically 0.5% to 3%).

Where It Appears in the Planning Certificate

In a Section 10.7 Planning Certificate, there may be a note such as: "A contributions plan applies to the land. The owner may be liable to pay contributions to the council upon carrying out development." This alerts the buyer or developer that a financial contribution may be required as a condition of development consent or Complying Development Certificate (CDC).

Why It Matters

Failing to understand and budget for contributions can result in:

• Unanticipated upfront costs
• DA (Development Application) delays
• Non-compliance with approval conditions
• Disputes at the time of CDC or DA assessment

For larger developments, contributions can total tens or hundreds of thousands of dollars—so it's vital to factor them into your financial modelling early.

How Are Contributions Calculated?

This depends on the type of development and which section of the Act applies:

You can typically access your local council’s Contributions Plan on their website. It will contain:

• Contribution rates
• Calculation methodology
• List of works to be funded
• Maps showing applicable areas

Example Scenarios

• A developer building 3 townhouses on a site may be asked to contribute under Section 7.11 for local park upgrades, roads, and drainage.
• A homeowner adding a $500,000 extension may be charged a Section 7.12 levy of 1% = $5,000.

Frequently Asked Questions (FAQs)

• Is the contribution paid at the time of purchase?
  No. Contributions are typically payable when a Development Consent or Complying Development Certificate is issued—not at the time of property purchase.
• Are all properties subject to a Contributions Plan?
  Not always. The 10.7 Planning Certificate will indicate if a Contributions Plan applies to that parcel of land.
• Can contributions be waived or reduced?
  In some limited cases—such as affordable housing projects or developments with public benefit—councils may offer exemptions or reductions, but this is rare and must be approved formally.

Make It Simple with SiteReview.ai

SiteReview.ai helps you understand if a Contributions Plan applies to your site by extracting this information directly from your Planning Certificate or Contract of Sale. Our AI-generated reports explain:

• Whether a Contributions Plan applies
• What type of contributions may be required
• Key considerations for budgeting and compliance

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Final Word

Contributions Plans are a crucial part of the NSW planning system. Whether you're a developer or a first-time builder, knowing your obligations early can save you time, money, and headaches down the line. Don't get caught by surprise—check your planning certificate, review your council’s plan, or let SiteReview.ai do the heavy lifting.