Innovative financing such as value capture must at least be evaluated by a project proponent, before the Commonwealth will consider funding it under its $10 billion National Rail Program, the program’s newly-released criteria states.
Minister for transport and infrastructure Darren Chester, and minister for urban infrastructure Paul Fletcher released the National Rail Program criteria on December 13.
The 16-page document follows the Turnbull Government’s May 2017 commitment to spend $10 billion over the next decade on transformational rail projects in major cities, and in surrounding regions.
State governments, local governments, and body corporates are eligible to make funding proposals.
Two key themes of the document, which can be viewed in full here, are that proposals should present value for money, as well as sources of additional funding and financing.
One component of this is a requirement that all proposals include the consideration of options like value capture – the act of charging an additional land tax around a new piece of infrastructure, to help fund it.
Chester said the criteria for the NRP reflected the Australian Government’s commitment to take a direct role in ensuring state-based infrastructure investments delivered value for money.
“Better rail connectivity also makes it possible to grow the regions, reduce congestion in our cities, create thousands of new jobs, and support our efforts to decentralise,” the transport and infrastructure minister said.
“The NRP will deliver funding for both planning and construction over the next 10 years, recognising that large scale rail projects have long lead times.”
Darren Fletcher said the NRP had been designed so that the Government can target its investment in transformational rail projects that deliver the greatest economic and social benefits.
“By investing in transformational rail projects, travel times for commuters will be cut, and families and businesses will have affordable options to live and invest,” he said.
“Projects under the NRP will need to address identified deficiencies, deliver economic benefits and consider innovative funding and financing solutions.
“Funding decisions will be informed by state and territory transport plans with projects seeking over $100 million in Commonwealth funding needing a positive assessment from Infrastructure Australia.”