Metropolitan Parks Charge - Melbourne

The Melbourne Metropolitan Parks Improvement Rate, commonly known as the ‘Parks charge’, is an annual levy on commercial and residential properties in the metropolitan Melbourne area in Australia. The parks charge has been included on water, sewage and drainage bills for residential and commercial properties since 1958. The charge is calculated by applying the annual parks charge rate by the properties Net Annual Value, as determined by the Council. The charge appears on each financial year’s first quarter water bill. The funds that are raised go to Parks Victoria, Zoos Victoria, the Royal Botanic Gardens and the Shrine of Remembrance for the development, management and maintenance of metropolitan parks, gardens, trails, waterways, and zoos. Payments from the fund must be used for the management and control of open space, parks and waterways within the metropolitan area for the purposes of conservation, recreation, leisure, tourism and navigation.

Overview

Type of instrument:

Economic and fiscal instruments›Financing mechanisms /market-based instruments (e.g. taxes to generate revenue)

Challenges addressed

Green space management (e.g. accessibility)
Heat stress and heat island effect
Air quality
Nature appropriation / stewardship
Reconnection to the biosphere / environmental education
Human health, comfort and well-being

Consideration of nature-based solutions:

The Melbourne Metropolitan Parks Charge is used to support parks, trails and public facilities across Melbourne, as well as Melbourne’s zoos, the Royal Botanic Gardens and the Shrine of Remembrance. The generated funds ensure that the network of large urban parks and trails is maintained and staffed for future generations. Melbourne's parks are essential nature-based solutions, which deliver multiple benefits to tackle biodiversity loss and the climate crisis in cities while improving the urban quality of life for residents and visitors alike. The green spaces offer natural habitats for biodiversity and act as stepping stones for natural species migration. The parks offer carbon sequestration to achieve climate mitigation goals, act as a natural filter providing cleaner air and are important places for recreation and re-connection with urban nature.

Targeted (peri-)urban areas:

Parks and (semi)natural urban green areas

Good practice characteristics:

Support multifunctional NBS

Sustainable in the long-term

Locally appropriate

Potential to be replicated / upscaled

Innovative

Policy business case

Governance

Government body/bodies

Initiating body:

Department of Environment, Land, Water and Planning.

Instrument design:

Instrument implementation:

Type of involvement:

The three metropolitan retail water corporations collect the Parks Charge on behalf of the Department of Environment, Land, Water and Planning.

Type of non-governmental actors involved:

Property owners are responsible for paying the parks charge.

Targeted actors:

Private: household, real estate developer, business , financial

Financing

Sources of funding:

Public local authority’s budget

Budget:

Unknown

Details about instrument financing:

During the 2020-21 financial year, a total of circa €155 million ($159 million) was disbursed from the Parks and Reserves Trust Account; in 2019-20, approximately €162 million ($166 million) was disbursed for the full financial year. The valuation by the local council determines the level of the charge per year, with most property owners paying the minimum charge. The charge increases periodically in accordance with the Treasurer’s Rate to meet additional costs associated with managing parks and bays services in the metropolitan area. There are two different calculation methods for residential and commercial properties, and there are certain properties that are exempt from the parks charge, such as for public purposes (e.g. a public primary/high school, etc.). The Water Industry Act (1994) provides for the rate to fixed by reference to the net asset value of the property. All rates are levied upon the net annual value of the land as of 30 June 1990 levels as determined for the purposes of the Local Government Act (1989). The Water Industry Act (1994) also provides for the fixing of different minimum rates and for different classes of land (domestic and non-domestic properties). The Parks and Reserves Trust Account receives the money collected from the Parks charge.

Monitoring, evaluation and impacts

Is a monitoring framework in place?:

Yes

The disbursement of the fees is monitored in each financial year and all activities financed with the fees are disclosed.

Did an evaluation take place?:

Achieved outcomes and impacts:

The Parks Charge has been running successfully since 1958, and the City of Melbourne's network of parks is internationally acclaimed as a result of this innovative policy tool, which plays an important role in the ecological sustainability of Melbourne's urban environment. Collected funds have been applied for the following activities: park management services in the metropolitan area, including managing bays, maintenance, and construction of park assets, including: National and State parks, Zoological parks, State gardens, Shrine of Remembrance, purchase of public open space for conservation, recreation, leisure or tourism management and maintenance of public beaches and renourishment works.

Success factors and lessons learned:

Integrating the charge for public parks into the bills for residential and commercial properties has contributed to the city of Melbourne's ability to sustainably maintain and increase its green spaces. The policy instrument, which orients itself on the net asset value of the property, ensures that the Parks Charge does not disproportionately burden small households and low-income residents. The charge is firmly embedded in the policy framework, including laws and other policy instruments, which shows the city's high ambition in supporting urban nature.

Sources and further information

Further documents

Weblinks:

https://www.parks.vic.gov.au/about-us/parks-charge

https://www.delwp.vic.gov.au/our-department/parks-and-reserves-trust-account

Photos

@Jardines Botánicos Reales de Victoria