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Chapter F10 Other road-related funding policies
F10.2 Betterment
Introduction
Section 326 of the Local Government Act 1974 requires territorial authorities, under certain circumstances, to collect betterment from landowners receiving value from improvement works.
The table below describes the situations where betterment arises.
| Scenario | Payment of betterment |
|---|---|
| The council has formed a new road/widened an existing road.
To do so, the council has acquired a parcel of land from the landowner. The remaining part of the land will have access or frontage to the improved road. The value of the remaining part of the land owned by the landowner is increased by the road work, above the amount of compensation paid for that land. |
The owner of the land must pay the value that exceeds the amount paid by the council. |
| The council is widening an existing road.
To do so, the council has acquired land from only one side of the road. |
If required by the council, every landowner having land with frontage to the other side of the road must pay the increased value given to their land. |
| The council is widening only part of an existing road. | Only landowners having land with frontage directly opposite the widening may be required to pay the increased value given to their land. |
| The council has formed a new road/widened an existing road.
The value of any remnant of land is either reduced or not increased by the road work. |
Betterment does not apply. |
Proceeds from betterment
When a territorial authority recovers betterment for a financially assisted roading work, the proceeds shall be apportioned between the NZTA and that authority at the rate of funding assistance applying to the work in question.
The proceeds will be applied as a credit against the cost of the road improvement work.
Legal and valuation costs
Legal and valuation costs incurred in establishing the financial value of betterment are not eligible for funding assistance.
Programming
Betterment must be considered, in particular, for the following work categories:
- 323: new roads
- 324: road reconstruction
- 325: seal extension
- 332: property purchase (local roads).
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