Wednesday, 12 March 2014
Ceisteanna - Questions - Priority Questions
Unfinished Housing Developments
3. To ask the Minister for Environment, Community and Local Government if his attention has been drawn to the fact that public lighting was recently abruptly turned off in an estate (details supplied); if, considering the severity of the problem and the extent of unfinished estates around the country, he will consider a re-evaluation of which estates may fall into category 4 estates to remove obstacles to taking in charge and specifically avoid situations where public lighting may be turned off by a supplier arising from non-payment of bills; and if he will make a statement on the matter. [12005/14]
This question pertains to unfinished estates that are not designated as category 4. The public lighting in one estate in my constituency was switched off last week because the builder had gone into receivership and there was nobody to pay the bill. I am concerned about the public safety issues arising from the loss of lighting and how estates can transfer from category 3 to category 4 when a developer ceases to exist as a legal entity.
I am chairing the national co-ordination committee on unfinished housing developments to oversee implementation of the report of the advisory group on unfinished housing developments, together with the Government’s response to the recommendations. In March 2011, my Department launched the public safety initiative, PSI, which provided funding to address immediate public safety issues. The types of works that have been approved to date under the PSI include the fencing of unsecured and hazardous areas, capping of pipes, installation of street lighting and other works to secure sites. Under the PSI my Department has made allocations totalling €4.5 million to local authorities from the funding made available. To date, €3.26 million has been drawn down.
The public safety initiative provides funding only in instances where a developer has abandoned the development. In circumstances where the developer is merely inactive, responsibility for the maintenance and resolution of issues surrounding the development need to be addressed between the developer and the relevant stakeholders, and my Department has no remit in this regard. However, I understand that public lighting in Chambers Park has been restored.
Budget 2014 contains a special provision in the form of a targeted €10 million special resolution fund, SRF, to assist further in addressing the legacy of unfinished housing developments. The SRF has been proposed to encourage the resolution of the remaining tranche of unfinished developments identified in the national housing development survey of 2013 and, particularly, those developments unlikely to be resolved in the normal way through developer, owner or funder action because of the presence of specific financial barriers. It is envisaged that the SRF should be targeted at addressing remaining unfinished developments with residents living in them and, in particular, any developments that local authorities identified for the purposes of the local property tax waiver as being in a seriously problematic condition. My Department is currently evaluating SRF proposals from local authorities. I hope that the SRF will enable very substantial progress to be made in resolving as many of the remaining unfinished developments as possible.
Some of these estates were categorised for the property tax last year. The number of estates will increase as companies are liquidated, and they require a mechanism to transfer from category 3 to category 4 to allow them to leverage funding. In the case of the aforementioned estate, approximately €200,000 is needed for the wearing course on the road and to finish other aspects of work on the estate. There is a commercial building on the estate and any assets from its liquidation would have gone to the Minister for Finance.
There is no bond in place in this particular estate. I am using this estate as an example, but it is not unusual and can happen anywhere in the country. The assets will go to the Minister for Finance and will not be available to the local authority. The estate will be retained at category 3 unless there is a mechanism for it to go to category 4 to resolve these issues. How will the Minister of State deal with the growing number of estates which will fall into this category? There will not be thousands, but there certainly will be some which need to go into this process.
I understand the local authority has intervened and the lights are working. If there is anything further we need to investigate with regard to the estate we certainly will do so. We asked local authorities to categorise estates and this information was used to draw down the public safety initiative. We have moved on to the site resolution fund of €10 million which I announced recently and on which we will make decisions soon. The fund will be used for estates with public infrastructure work to be done, including public lighting, footpaths and roads. It will encourage funding by developers to bring the estate fully into use and then move it forward to be taken in charge by the local authority. This is the purpose of the fund, which will be a mechanism to address the ongoing issues which arise in unfinished estates. We have site resolution for each unfinished estate and the intention is that gradually they will no longer be unfinished and will be either fully finished or, in a very small number of cases, cleared.
The site resolution process does not deal with estates not categorised as category 4 estates. This is my point. There is no site resolution on this estate of 300 houses. The local authority picked up the €25,000 tab left by the developer, but the estate cannot get into the resolution process unless it is recategorised from a category 3 estate to a category 4 estate which means it has been abandoned by the developer who has been put into liquidation. This is my point. The process of getting from category 3 to category 4 must be seamless where the developer is no longer a legal entity and no longer around. It does not seem possible to get from category 3 to category 4. This is the question I want answered.
We are genuinely trying to resolve all these issues and we have had a number of mechanisms, the current one being the site resolution fund. Recently I chaired a meeting with representatives of all the various interests involved. We intend to get to a point where these estates are ready to be taken in charge by the local authorities. There are ongoing issues and I concede there are issues in some estates which are difficult to solve, particularly where the developer has gone. We must be careful the State does not take on the obligations of private developers. We must get the balance right. This is an ongoing issue. There are some difficult estates where we have not reached a position where they are resolved. We will continue to work on them, including this one.