WA Can the council make me pay for power infrastructure upgrade

Hi All,

I purchased an IP in Carlisle, Perth in late 2017. Last week I received a letter from the council in regard to an underground power project. The are getting rid of poles and wires and putting all infrastructure underground which I think is generally a good thing. However I was shocked to read all residents are required to pay $4000 towards this project !!!
This is the first I have heard of the project and nothing showed up in searches during the purchase. To make it worse my place already has underground power...when I told the council this they said I get a discount of $400 (whoppee Do! )

I’ve already asked the conveyancer to review their file and provide advice but wondered if anyone on here has any ideas or opinions that may help???

@icic I know you purchase in Vic Park in the last few years so you may be affected by the same issue.

 

Does your street still have power poles and you have a dome next to a pole then underground to your house? This is not true underground power and the discount you get will be because you already have the dome but you need to contribute to the rest of the area/street/site upgrade.
Some councils will split these things over a couple of rate cycles but it seems not in this case.
There is information on the VicPark council website State Underground Power Program

 

Thanks for the reply. Yes we have a dome and then underground to the house.

I have already spoken to the council and read all the info on the website apparently they are in the process of recruiting an officer to manage the interface with the community.

As you suggested there is an option to spread the cost over a few years but I’m still struggling with the whole concept of being “told” to pay directly and such a large amount for an upgrade to an essential service.

 

Hornsby shire purchased an ex-brick pit. Cost was millions to rehab.

 

It is hard when the gain is so little. The next time someone crashes their car into a power pole and it doesn't affect you it will start being a blessing.

It's weird that the govt don't pay for all of it and ask the local govt (ie rate payers) to pay for half of it.

Having just paid an exorbitant amount for town/scheme water to be extended to our part of the street I am no longer surprised. Watercorp only did the water pipe for some of the street leaving the last 3 properties (semi rural) with no access to scheme water. However if I wanted scheme water then I had to pay for it to get to my block and go past to the boundary of my neighbour. We had to pay for all the works (civil contractors) then it became asset of water corp.

 

PS and we had to pay for an upgrade to the street power system as our mcmansion needed too much power

 

https://www.hornsby.nsw.gov.au/__da...106590/Approved-Brickpit-Park-POM_resized.pdf

 

Maybe for the tenants but not sure I will see any return on the $4k of investment in the way of a rent increase.

That sucks about the Watercorp not connecting you to the scheme...

 

This also happened to a friend in Menora ( considerably higher) and my daughters in Vic Park has also received the invoice and letter.

 

I lived in East Vic Park in 2003 and our pocket was one of the first in WA to be part of the underground project, so it has been an ogoing State wide project for nearly 20 years now. I too was unhappy about it, mainly because my street also had high voltage power lines and they were not being put underground. Households like us received a small discount but it was pointless given we still had the power poles and wires running past the house.

While the underground power program has benefits, ie the streets do look better without the poles and wires and it results in more reliable power, the fact remains that most of WA’s overhead power infrastructure was outdated and required significant upgrade. The cost of the upgrade could have been borne by Western Power as they are a business and charge Synergy the cost of distributing power, but at the end of the day the capital costs does ultimately get passed on to the consumer.

So the cost of the program is shared a third each to Western Power, the Council and the individual households. The State government said that households benefit through higher property values and Councils benefit from increased rates and lower electricity costs of street lighting (as more efficient lighting was used with the new poles). Back then, I was a pain to the Council and the Energy Minister’s office, requesting modelling details of how much property values will rise, especially for those still stuck with high voltage wires and distributed pamphlets to all affected residents with the Minister’s phone contact – the **** the fan.

 

So this has been going on for 20 years. I can’t believe it and feel like I want to take some action against it like you did. Would love to hear if you caused enough disruption to be appeased in some way? I understand costs generally get passed down to the end users and I’d be happy to pay a little more on the transmission tariff or standing change and let the tenant pay a little more on the unit rate for consumption. I just can’t believe we are being asked to pay it in one hit or with a 5.5% interest charge for instalments which given the current cost of capital is another **** take just to add insult to injury.

 

This project started as a way to minimise the risk of storm damage affecting power supply (and we all know how angry people get when power goes out - and guess who they blame!). 87,000 households have already been converted.

Here is a link to the project page:
What is the State Underground Power Program (SUPP)

FAQs:
The State Underground Power Program (SUPP) FAQs

There is a photo showing before and after and it is a great improvement.

Also, they say that around 10% more (all new) street lights are installed, they are more closely positioned and generally alternate from one side of the road to the other. The new light poles are designed to collapse if hit by vehicles to reduce injuries and damage.

I’d be prepared to pay - just to allow decent sized street trees to grow. Currently, with overhead lines, they prune them back so much it really reduces shade etc.

I think it’s fine for owners to pay part of the cost. $4,000 is peanuts compared to the actual cost and the benefits.

 

I'm with you, @Skinman - while there may be a lot of benefits to the scheme etc, that's not the point here. The point is that someone else has decided that this project will go ahead (you weren't asked if you wanted it, but were told that you'd be forced into it), and then you're being expected to foot the bill for it.

And for some people $4K may not sound like a lot of money, but for many others, it could be devastating blow to the household budget (and one that you couldn't have foreseen, or pre-planned for). I'd be absolutely devastated if I was told I couldn't go on a family holiday for the next 4 years because I now how to use that money to pay for a change in the streetscape's power infrastructure!

 

I agree about how we each feel about $4000. To someone in Sydney or Melbourne, spending $4000 and having their land value increase is chicken feed. To someone in Perth or anywhere else who has not had any reasonable increase in their land values for years, it is just another kick in the guts to property owners. @Joynz, would you be so blase about it if you were in the same situation?

 

@Angel my thoughts exactly...I started writing this exact response and then stopped as I’m keen to listen to and hear what others think.

 

I'd suggest forgetting about taking any action. As I found out, you can create a lot of angts but ultimately you cannot win. Apart from the pamphlets to residents, letters to Ministers, newspapers, local members etc, I also raised it with the Vic Pk council at one of their meetings - I was shut down by the Mayor who refused to discuss it, just saying that most residents agree with the project.

Overall, I think the project is worthwhile but it should have been a capital expense on Western Power (as it would for any other business) and reflected in a higher charge to Synergy. The poles and wires are in a poor state (just look at some that still exist in suburbs, many rotted, twisted or being held up by cables). The underground power will result in significant savings in maintenance but Western Power is already losing money (over a $1 billion last financial year) so the savings will not be passed on to consumers.

I agree with your point around interest rates. As a government instrumentality, the Council can at present borrow at less than 2%, so why make a profit from residents who cannot afford or justify prioritising the payment up front?

 

@Skinman hopefully you’ve purchased at the bottom of the cycle and will easily make your $4000 back. I remember in Ashfield quite a few run down, original homes were sold before the underground power went through, I’m assuming to get out before having to pay for it. It looks so much better! It cost us $4000 also about 8 yrs ago. I’ve moved house several times in the past ten years and haven’t lived in a house with power poles for fifteen years. I feel it does add value in most cases. I’ve been turned off buying houses in streets with poles! I remember a forum member sold his Ashfield property half way through paying it off to move interstate and had to pay off the remainder. Eden Hill and North Bassendean have a proposal but it looks like it will be a lot more subsidised as Eden Hill has previously disagreed to proposal and Power Poles in bad condition with heaps of Power outages. Wow, sorry to hear of your utility expenses Myf! @Westminster
I can understand it is a bit annoying! While we were paying off Ashfield upgrade there was a proposal for Yokine. I had a villa at the back of a complex on a moderately busy street so I wasn’t going to get much benefit. It encouraged me to sell at the start of the downturn!

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It's a tricky one. To be fair, streets/estates that have underground power from day one had it paid for by the subdivision developer and therefore built in to the purchase price for the first land buyers, at no cost to Western Power or the local government. So it's actually not a bad deal for property owners to have 2/3 the cost for retrofit of underground power covered by others.

On the other hand, I have an IP supplied by old power lines, and I'm dreading the day that I eventually get a letter to say I'm going to have to pay several thousand bucks to put the power underground. I hope it never happens. And that interest rate of 5.5% is a joke.

 

Though, you can start saving now!

 

Of course, no one (including me) wants to pay a bill!

However, I see some real,advantages.

I also don’t subscribe to the ‘poor property owners’ view some have expressed.

This is just another cost of owning property. The people who benefit should contribute.

And let’s not forgot that this is a great deal - as it’s being subsidised significantly. The real cost of the work will be much higher than the owner is being charged.

I assume that it can be paid off over time if an owner can’t afford to pay it all at once.