Sam Hibbins to ask the Minister for Planning —
With regards to the Punt Road Public Acquisition Overlay (PAO) and the factsheet the Government recently published:
(1) If the Government decides to acquire the land, how is compensation for affected homeowners calculated.
(2) What is loss on sale compensation and how does it affect the value of the affected property.
(3) If the PAO is removed how is compensation calculated
Response to the Minister for Planning
There are currently no plans to acquire land affected by the Public Acquisition Overlay (PA) for the proposed widening of Punt Road. Should the Government decide to acquire this land in the future, the acquisition process is governed by the Land Acquisition and Compensation Act 1986. Under this Act, homeowners are paid:
- The market value of their property as determined by an independent valuer, disregarding any affect upon value arising from the PAO;
- Those professional expenses such as valuation and legal fees necessarily incurred by reason of the acquisition;
- Where appropriate, the costs incurred in the purchase and relocation to a replacement property; and
- Where eligible, an additional payment for solace known as solatium, for the non-financial disadvantages arising from the acquisition.
Loss on Sale compensation arises under Part 5 of the Planning and Environment Act 1987. This allows an eligible owner to claim compensation following the sale of a property, where the property was sold at a lower price than might reasonably have been expected, because it was affected by a PAO. Compensation for Loss on Sale is determined by an independent valuer. Typically, it is the difference between the sale price achieved for a property and the price the property would have achieved if not affected by a PAO. Any payment made for Loss on Sale compensation is taken into account upon acquisition of the land, so as to avoid double payment of compensation.
If a PAO is removed from a planning scheme, then the owner at the time may claim compensation under Part 5 of the Planning and Environment Act 1987, for any financial loss suffered as the natural, direct and reasonable consequence of the removal of the PAO. How compensation is assessed is dependent upon the individual circumstances of each matter. Typically, upon removal of a PAO, limitations on the use or development of land arising from the PAO are also removed and so the market value of property would usually increase as a consequence.
If compensation has been paid on a property under Part 5 of the Planning and Environment Act 1987, upon removal of the PAO, the owner of the land at the time the PAO is removed is required to repay the amount of compensation previously paid. How and when this repayment is to be made is a matter agreed between the relevant authority and the landowner.
