Development contributions; collection
Payment obligations for property owners may arise as a result of contracts and development contribution notices.
The development of building areas by providing on-site infrastructure is a task of the municipalities. Development facilities for which the residents regularly have to pay on a pro rata basis due to special advantages are typically, on the one hand, the piped facilities (water supply, drainage, district heating) and, on the other hand, the development roads (possibly also parking spaces, green spaces and noise protection facilities). The municipalities have a wide margin of discretion in the concrete design of the road or pipeline route.
An obligation to pay can arise from contracts. For example, if a developer accepts the development from the municipality at his own expense on the basis of a development contract and then passes this on to the adjoining owner (purchaser) in the real estate purchase contract via the purchase price. Frequently, the municipalities themselves acquire the building land, plan and develop it and then refinance themselves in the real estate purchase contract via the purchase price to the adjoining owner (purchaser).
Insofar as no contractual refinancing takes place, the municipalities are regularly obligated to cover their development expenses via so-called development contributions. It is important to note that it is not possible to charge for "the infrastructure as a whole", but rather contributions are levied separately for each facility, e.g. independent contribution notices for each individual road, for the water supply and for the sewerage system.
In any case, the levying of contributions requires an effective local contribution statute, which can differ from municipality to municipality, so that global statements can only be made to a limited extent. An assessment of contribution notices requires knowledge of the relevant local law, which can be inspected at the municipality.
Contributions for the initial construction of roads, parking lots, green spaces and noise protection facilities are referred to in the narrower sense as "development contributions". They are levied on the basis of Art. 5a of the Bavarian Municipal Tax Act (KAG) in conjunction with a corresponding development contribution statute. The obligation to pay contributions arises automatically for the developed properties on the basis of the statutes if the legal requirements - above all, technical construction of the facility, presentation of all invoices and development effect - are met.
The municipalities are legally obligated to levy corresponding contributions and must bear no more than 10% of the development costs. Since 01.04.2014, development contributions may only be levied within a maximum period of 20 years after the occurrence of the advantage situation. The benefit situation exists when the development is "ready for operation as a whole", i.e. when it is finally technically completed. In addition, since 01.04.2021, Art. 5a Para. 7 Sentence 2 KAG applies, according to which development contributions may no longer be levied 25 years after the start of the initial technical construction of a development facility.
Contributions may also be levied for the other development facilities, in particular pipe-bound facilities (water supply, drainage), on the basis of the Bavarian Municipal Charges Act. For this purpose, the municipality must enact two statutes: a master statute regulating the use of the facility (e.g. a water supply statute for water supply or a drainage statute for sewerage) and an associated statute on contributions (usually referred to as a "contributions and fees statute"). Unlike development contributions, the municipality has a choice here: it can finance its investment expenditure through contributions or include it in the calculation of the charges to be levied on an ongoing basis and thus refinance it in many small steps over a longer period of time. It is also possible to combine both options and to pass on the investment expenditure to the citizens partly via contributions and partly via charges. The decision in favor of one of these options is made by the municipality in the local contribution and fee statutes by providing for appropriately calculated contribution or fee rates.
Contributions for development facilities can reach a considerable amount.
If the levying of contributions leads to particular hardship for the party liable to pay, it is at the discretion of the municipalities to mitigate this in a socially acceptable manner by means of equitable measures, e.g. payment by instalments, annuity, deferral or remission. The person liable to pay the contribution can submit an application to his municipality for this purpose.
If you do not agree with a contribution notice, please ensure that you comply with the deadlines specified in the relevant appeal instructions. Once these deadlines have expired, the notice becomes final.
Responsible for editing: Bayerisches Staatsministerium des Innern, für Sport und Integration
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