Development charges are a type of financial obligation. These obligations are required from developers.
Developers pay these to local governments. Development charges differ from taxes and service fees.
Taxes are compulsory charges on income or property. Service fees are payments for specific services.
Development charges fund public infrastructure necessitated by new development. Examples of public infrastructure include roads and sewage systems.
Development charges feature infrastructure improvement costs. Infrastructure improvement costs enhance existing facilities.
Examples include upgrading roads and expanding sewage systems. Development charges also feature facility expansion costs.
Facility expansion costs increase service capacity. Examples encompass new schools and fire stations.
Another feature includes utility connection fees. Utility connection fees connect developments to municipal services.
Examples involve water and electrical connections.
Common features of development charges include calculation based on project size. Project size determines the charge amount.
Larger projects incur higher charges. Calculation also involves zoning considerations.
Zoning considerations influence the cost. Residential zones might have different rates than commercial zones.
Another common feature is the inclusion in project budgets. Project budgets must account for these charges.
Failure to do so can lead to financial shortfalls.
Unusual features of development charges include rebates for certain projects. Rebates support developments with social benefits.
Examples are affordable housing projects. Another unusual feature is phased payments.
Phased payments allow developers to pay over time. This assists with cash flow management.
Adjustments for economic conditions represent another unusual feature. Economic conditions can lead to charge increases or decreases.
Unique features of development charges include specific exemptions. Exemptions apply to certain development types.
Examples include historical preservation projects. Another unique feature is the influence on land value.
Land value can decrease due to high development charges. Development charges can trigger redevelopment of underused areas.
This leads to urban regeneration.
Development charges possess specific attributes differentiating them from similar financial obligations. Unlike taxes, which fund general municipal operations, development charges directly support infrastructure necessitated by new developments.
Unlike service fees, which cover the cost of delivering individual services, development charges ensure the developer contributes to the overall community needs.
For more details on terms related to real estate, visit our glossary about Bangkok real estate.