The Community Infrastructure Program: E-Alert July 2009

If your Council applied for funding under the Community Infrastructure Program –Strategic Projects Plan, then keep your eyes open for further announcements. The Hon Anthony Albanese MP, Minister for Infrastructure, Transport, Regional Development and Local Government has recently begun to announce successful projects and on 25 June 2009, a second round of funding for the end of the year was announced.

Also, remember that whilst the Nation Building and Jobs Plan (State Infrastructure Delivery) Act 2009 (NBJPA) may provide exemptions from development control legislation requirements, it does not exclude Council compliance with local government tendering requirements.

Background

Earlier this year, the Commonwealth Government announced that the funding for the Community Infrastructure Program (CIP) would be increased from $300 million to $800 million. Last week, Prime Minister Kevin Rudd, speaking at the second meeting of the Australian Council of Local Government, announced an additional $220 million ($100 million shared and $120 million on a competitive basis for strategic projects), bringing total investment in the CIP to more than $1 billion.

The CIP, which is part of a $42 billion Nation Building –Economic Stimulus Plan, is aimed at stimulating growth and economic activity across Australia, supporting national productivity and community well being and is being delivered in two parts: $250 million (plus the additional $100 million), divided between all Australian councils and shires; and $550 million (plus the additional $120 million) on a competitive basis for strategic projects. The applications for the first round of strategic projects closed on 6 March 2009 and guidelines for both components of the additional funding for the CIP will be released later this year.

Strategic Projects

The initial $250 million has been divided between 565 councils and shires on the basis of a methodology which included relative need, population and growth. These funds are for ready toproceed community infrastructure as well as for additional stages of projects that have already commenced. Each council has received a minimum of $100,000 and the funds must be spent by 30 September 2009. The second round of funding will see each council and shire receive $30,000, with additional funds being allocated according to a formula, including population and classification.

The $550 million was for larger scale community infrastructure (known as "strategic projects"). These projects must have been ready to commence within 6 months or must have been additional stages of existing projects. Successful projects already announced include $3.75 million to help redevelop the training centre for the Flying Fruit Fly Circus in Albury, $4 million for the upgrade of Launceston's Aurora Stadium and $10 million towards the restoration of Brisbane City Hall.

Currently, it is unclear whether the same criteria will apply to the additional $120 million of funding. If your original application for a strategic project was rejected, feedback is available from the Department which may assist you improve future applications.

Procurement

Commonwealth funding of strategic projects will require strict compliance with project timetables which may mean traditional procurement processes and/or project delivery methods commonly used by councils may not be suitable. More suitable project delivery methods may include managing contractor contracts, as adopted by the NSW government for the Building the Education Revolution project, and alliancing.

Tendering obligations

Despite the provisions of the NBJPA, Councils must continue to comply with their statutory tender obligations including section 55 of the Local Government Act 1993 (NSW) and Part 7 of the Local Council (General) Regulation 2005 (NSW) including advertisements, time periods for obtaining responses, procedures for amendments to be made to tender documents (by either the Council or the tenderer) and the selection and appointment (or not, as the case may be) of a successful
tenderer.

If you require further information in relation to any of the above issues, please contact Stan Kondilios or Mal Fielding.