Monday, January 10, 2011

Councils act against developers over €1bn in unpaid levies | The Post

Councils act against developers over €1bn in unpaid levies
09 January 2011 By John Burke

Legal proceedings have been launched against scores of high-profile developers for millions of euro in unpaid levies.

The proceedings, which are being taken by local authorities, relate to more than 1,390 property developments.

Figures seen by The Sunday Business Post show that 200 cases have already been referred to the courts by local authorities, which are attempting to recover almost €1 billion in overdue development contributions.

A majority of local authorities across the country have now signed up to a shared planning development contribution system, developed by the local government audit service, whereby councils can share details about, and manage, unpaid development levies. More than 13,450 debtor accounts are now being managed by local authorities’ finance departments under the system.

Most of these debtors have given a commitment to pay outstanding levies.

Councils have allowed developers to renegotiate payments on a further 1,850 sites, following a coordinated blitz of property developments late last year in which councils sought to determine who could afford to make greater or lesser payments.

More than 100 staff have now been assigned by local authorities to collect outstanding levies.

Informed sources said a significant majority of the developments concerned were under the control of the National Asset Management Agency (Nama).

Local authorities have been in discussions with Nama in recent months to secure agreement on the payment of hundreds of millions of euro in unpaid development levies from builders whose loans have been transferred to the agency, according to the city and county managers association.

Many of the developments currently under the control of Nama cannot be further developed without a certificate of compliance being issued by individual councils.

Despite the downward demand for property, many of these developments could lose considerable value if their planning permission expires without the building works having begun.

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