The Construction Industry Federation has lost a High Court challenge to a new development levy introduced by Dublin City Council.
In a reserved judgment yesterday, Mr Justice Gilligan dismissed the CIF challenge and found the council was entitled to agree a development levy scheme under which developers will pay a contribution of €11,500 per house constructed and a commercial levy of €110 per square metre.
The CIF has said it may yet appeal the decision to the Supreme Court.
The new levy scheme was introduced in the Planning and Development Act, 2000. It says that planning authorities must set contributions to be imposed regarding public infrastructure and facilities provided by the planning authority generally in its area, whether or not such facilities are of benefit to the particular development concerned.
Planning authorities have until next Wednesday to agree the charges. Local authorities have agreed charges ranging from €3,750 per residential unit in Carlow up to €18,000 for some homes in Kildare. However, some authorities have yet to agree the charge, including Wicklow County Council.
Planning authorities have also agreed levies on new commercial property ranging from €12.50 a square metre in Kerry to more than €115 in Limerick.
Under the previous 1963 planning legislation, conditions on contributions were a matter for the local authority manager.
There is no appeal to An Bord Pleanála if contributions are properly calculated.
The legislation also allows a planning authority to impose a special contribution for "specific exceptional costs not covered by the scheme", from which there is an appeal to An Bord Pleanála. Such contributions are repayable if the planning authority does not proceed with the proposed works or does not complete them within seven years.
Mr Justice Gilligan said that, under Section 48, in contrast to the 1963 legislation, there was no direct relationship between the contribution payable in respect of a development and the public infrastructure and facilities provided by a planning authority.
Development contributions collected under Section 48 formed a general fund to be applied for public infrastructure and facilities.
The CIF did not challenge the constitutionality of the 2000 Act but claimed the council acted beyond its powers in relation to the scheme it adopted, he noted.
Mr Justice Gilligan accepted that the CIF had a right to bring the proceedings but rejected the federation's contention that it was necessary for such schemes to specify the public infrastructure and facilities for which contributions were sought.
"The scale of the new levies being applied is unprecedented," the CIF said in a statement released after the ruling. "The total amount of levies raised by local authorities in 2002 was €151 million. Under the new scheme, local authorities will raise €500-€700 million per annum."