The Growth Areas Infrastructure Contribution (GAIC) is a charge that contributes towards the cost of essential State infrastructure in Melbourne's growth areas.

Where a GAIC payment is required, all or part of the payment can be offset if an agreement is made with the government.

The offset requires that land be provided to the government, infrastructure works be carried out, or a combination of both. This offset arrangement is known as Work-in-Kind (WIK).

Background

GAIC, in Part 9B of the Planning and Environment Act 1987 (PEAct) was introduced on 1 July, 2010. GAIC applies to land zoned for urban development that was brought within the Urban Growth Boundary in 2005-06, 2010 or 2012.

GAIC is administered under the PEAct and the Taxation Administration Act 1997. The Victorian Planning Authority (VPA) (formerly the Growth Areas Authority trading as the Metropolitan Planning Authority) is responsible for administering GAIC and related policy.

You can read more about the GAIC on the VPA and State Revenue Office (SRO) websites.

GAIC WIK agreements and guidelines

WIK Agreements

WIK agreements allow a GAIC Liable Entity (GLE) to provide land and/or capital infrastructure works in a growth area, of a type that may be funded under section 201VA or 201VB of the PEAct, instead of a cash payment.

Two model WIK agreements have been prepared to assist GLEs considering entering into a WIK agreement, and to facilitate the negotiation of WIK agreements.

  1. A model WIK agreement that provides for the GLE to deliver capital infrastructure works (with or without land) in lieu of a cash payment:
  2. A model WIK agreement which provides for the GLE to transfer land in lieu of a cash payment:

GLEs interested in entering into a WIK agreement should initially contact the VPA. Two forms are available to assist GLEs in developing their proposals:

WIK Guidelines

WIK guidelines relate to the establishment and administration of WIK agreements. The WIK guidelines explain why the model WIK agreements are drafted the way they are, and how they work:

Growth Areas Infrastructure Contribution Work-in-Kind Guidelines (PDF, 1.8 MB)

Growth Areas Infrastructure Contribution Work-in-Kind Guidelines (DOC, 2.4 MB)

The WIK guidelines should be read in conjunction with Subdivision 2A of Part 9B of the PEAct and the model WIK agreements. If there is any inconsistency between these WIK guidelines and the model WIK agreements concerning the operation of the model WIK agreements, the model WIK agreements prevail.

The WIK guidelines were prepared by DELWP and the VPA, in consultation with the Department of Treasury and Finance (DTF) and the SRO. The development industry was consulted during the preparation of these WIK guidelines.

The WIK guidelines may be subject to revision, particularly in light of experiences gained from entering into WIK agreements.

GAIC rates for 2017-18

Section 201SG of the PEAct requires the GAIC amount payable to be adjusted annually according to a formula set out in the PEAct. The adjusted amounts for the next financial year are  published by the Minister for Planning by 1 June prior to the next financial year.

The adjusted GAIC amounts for 2017-18 are:

Land Type

GAIC Rate (per hectare)

A (section 201RC(2) of PEAct)

$93, 400

B-1 (section 201RC(3) of PEAct)

B-2 (section 201RC(4) of PEAct)

C (section 201RC(5) of PEAct)

$110, 930

The adjusted threshold amount for excluded building works in section 201RG of PEAct can be found on the VPA website.

The adjusted indexation of deferred GAIC under section 201SN of PEAct and interest payable under 201SO of PEAct on that deferred GAIC can be found on the SRO website.

GAIC funds

GAIC payments received by SRO are paid equally into two special purpose accounts established to fund State infrastructure and services in the growth areas.

The accounts established under section 201V of the PEAct are the:

  • Growth Areas Public Transport Fund (GAPTF) (refer section 201VA).
  • Building New Communities Fund (BNCF) (refer section 201VB)

Under the PEAct, GAIC can only be used for the purposes of State funded infrastructure and SRO expenses, with the authorisation of the Minister for Planning and usually the approval of the Treasurer, including:

  • public transport infrastructure (GAPTF)
  • SRO expenses (GAPTF)
  • non-public transport infrastructure such as for walking and cycling (BNCF)
  • community, environmental and economic infrastructure (BNCF).

GAIC cannot be used to fund local infrastructure or infrastructure funded through development contribution payments.

Any works or land delivered under a WIK agreement must also be of a type able to be funded from one of the two Growth Areas Infrastructure Contribution Funds.