1

Molloy Announces NEW URBAN RENEWAL DESIGNATIONS

Residential Tax Incentives to Boost Housing Supply

43 Cities and Towns to Benefit under Scheme

New Townscape Restoration Scheme Announced

Some 43 towns and cities are to benefit under new urban renewal designations announced today (17 February) by Mr. Robert Molloy, T.D., Minister for Housing and Urban Renewal.

These designations are based on Integrated Area Plans (IAPs) submitted by local authorities and in line with recommendations made by a special Expert Advisory Panel. Residential tax incentives will apply within the designated areas approved from 1 March, next, but the incentives for commercial development cannot be brought into effect until approved by the EU Commission under State Aid rules.

Minister Molloy also announced detailed proposals for a new Townscape Restoration Scheme for smaller towns. Preparations for this new scheme will commence now and the scheme itself will come into effect in the Autumn.

A total of 78 Integrated Area Plans (IAPs) were submitted by local authorities under the Urban Renewal Scheme and the Expert Panel recommended approval to 49 of these and that certain sub-areas within these IAPs be designated for urban renewal tax incentives (both commercial and residential).

Details of the cities/towns designated under the new scheme, the residential tax incentives, and the membership of the Expert Advisory Panel are attached.

Minister Molloy said that the new scheme will build on progress achieved under previous schemes. “The urban renewal concept has made huge strides in combating urban dereliction and decay which had cut a swathe through so many of the downtown areas of our towns and cities. We have all seen the transformation in the areas previously designated, everything from the new shopping facilities to the flagship developments. Most of all, we have seen people returning to live in town and city centres. We have seen what we thought had been lost and consigned to the social history books, revitalised towns and cities which now beat to the rhythm of downtown life.”

Minister Molloy added: “A major KPMG Report published in 1996 found that, while the previous schemes were successful in leveraging investment into areas of dereliction, results were mixed when it came to urban design and architectural standards. On the social side, indigenous residents and those in adjoining areas found it difficult to reap the benefits in terms of employment and other opportunities. A new, more structured approach was called for and the framework devised for future schemes was based on the recommendations of the KPMG Report.”

Integrated Area Plans

The new scheme represents a radical departure from previous schemes and involves a more targeted approach to the award of urban renewal incentives, both in terms of their scale and the way in which they will be applied. Designations are based on the concept of Integrated Area Plans (IAPs), which address not only issues of physical development but also cover wider issues of local socio-economic benefit. These Plans which local authorities were asked to prepare on the basis of comprehensive guidelines prepared by an Expert Advisory Committee were required to identify targeted sub areas for tax designations. They were also required to justify the proposed designation by reference to the Plan’s objectives and the barriers to development.

As a result, the sub-areas recommended by local authorities for designation have been reduced in many cases. Also, in line with the Bacon Report on house prices, the Section 23 type incentive for investment in rented housing will be applied very selectively and only where necessary to meet IAP objectives.

Tax Incentives

While the incentives under the new Urban Renewal Scheme apply to commercial and residential development, it is not possible to proceed with application of the full range of incentives because the EU Commission have not, as yet given, approval under State Aid rules to the application of the commercial incentives.

The Government has agreed to the Minister’s proposal to introduce the scheme in two phases i.e. proceed with designation and apply residential incentives which do not require EU approval under State Aid rules immediately and introduce the commercial incentives when the outcome of the current negotiations with the EU is known.

“There are compelling reasons why we should proceed immediately with designation and application of the residential incentives because of the need to do everything possible to bring forward development of all sites on which housing is planned to maximise supply and assist in stabilising prices. Many sites included in IAPs would be fully serviced and ready for immediate development if the uncertainty created by the prospect of designation was removed and developers knew where they stood one way or the other on decisions in relation to particular land”, the Minister said.

The Minister went on to say that pre-planning involved in preparing IAPs should accelerate the planning process for sites earmarked for development and facilitate the bringing on stream of development projects. Mr. Molloy said that under previous schemes only 12% of residential investment was in refurbished properties. “I am hoping that the IAP approach will give us a better balance between new build and refurbishment.”

Townscape Restoration Scheme

Many of the towns which did not get a recommendation from the Panel failed because they did not meet the criteria for the new scheme. The Expert Panel found, however, that many of the smaller towns which were not recommended for designation, contained a significant amount of urban townscape which had deteriorated badly.

While the Panel considered that the urban renewal scheme was an inappropriate vehicle for these problems, they felt that there was a need to address the problem. Minister Molloy said: “I’m glad to announce that the Government have decided to introduce a new scheme of tax incentives aimed at the restoration and conservation of townscapes in smaller towns including the restoration of old mills, warehouses etc. which have fallen into dereliction, and other improvements to the fabric of buildings e.g. shopfronts. New build development of an infill nature to restore gaps in the urban streetscape will also qualify. The new scheme will allow these problems to be tackled and facilitate the restoration of the streetscapes of these smaller towns.”

“Local authorities will now be asked to consider which towns can benefit from such a scheme and to submit Urban Townscape Plans to the Department by 1 August next. Guidelines for the preparation of these plans will be drawn up immediately with the assistance of the Expert Panel who will also advise on the completed plans. The Townscape Restoration Scheme will come into effect in the Autumn”, the Minister concluded.

ENDS

17/2/99

Further information:

Ronnie Devlin

Press and Information Office

Tel: (01) 888 2638 (direct)

(01) 888 2000

E-Mail:

Web site:

1

APPENDIX 1 - URBAN RENEWAL SCHEME

IAPs RECOMMENDED BY EXPERT ADVISORY PANEL ON URBAN RENEWAL

CITY / CITY
Cork Corp
Blackpool/Shandon
City Docks Area / Galway Corp
3 suburban LA estates
Dublin Corp
Ballymun
HARP
Inchicore/Kilmainham
Liberties/Coombe
North East Inner City
Millennium/O'Connell St / Limerick Corp
1 large central area
Waterford Corp
Periphery of commercial centre
COUNTY - TOWNS / COUNTY - TOWNS
Carlow
Carlow / Louth
Drogheda
Dundalk
Clare
Shannon / Mayo
Ballina
Cork
Bandon
Cobh
Mallow (N)
Passage West(S)/Glenbrook / Meath
Navan
Donegal
Buncrana / Monaghan
Monaghan
DunLaoghaire/Rathdown
Dun Laoghaire / Offaly
Birr
Tullamore/Clara
Fingal
Balbriggan
Nth. West Blanchardstown / Sligo
Sligo
Galway
Tuam / South Dublin
North Clondalkin
Tallaght
Kerry
Tralee / Tipperary NR
Roscrea
Thurles
Kildare
Athy
Kildare / Tipperary SR
Carrick-on-Suir
Tipperary
Kilkenny
Kilkenny / Waterford
Dungarvan
Laois
Portlaoise / Westmeath
Athlone
Mullingar
Limerick
Newcastle West / Wexford
New Ross
Longford
Longford / Wicklow
Arklow
Wicklow

1

APPENDIX 2

URBAN RENEWAL SCHEME

IAPs NOT RECOMMENDED BY EXPERT ADVISORY PANEL ON URBAN RENEWAL

COUNTY - TOWNS / COUNTY - TOWNS
Carlow
Bagenalstown
Tullow / Limerick
Kilmallock
Rathkeale
Clare
Kilrush / Mayo
Castlebar
6 East Mayo Towns combined
(Ballyhaunis, Knock, Charlestown, Kiltimagh, Claremorris and Swinford)
Cork
Skibbereen (W) / Meath
Ashbourne
Donegal
Ballybofey/Stranorlar
Ballyshannon / Offaly
Edenderry
Kerry
Killarney
Castleisland
Listowel
Cahirciveen / Roscommon
Roscommon
Castlerea
Ballaghaderreen
Kildare
Kilcock / Sligo
Ballymote
Tubbercurry
Laois
Portarlington
Mountmellick / Tipperary NR
Nenagh
Leitrim
Carrick-on-Shannon
Manorhamilton / Wexford
Gorey
Wicklow
Bray

1

APPENDIX 3

Expert Advisory Panel on Urban Renewal

Membership

Mr. Dom Hegarty (Chairman)Principal Planning Adviser, Dept. of the Environment and Local Government

Mr. Eoghan BranganSenior Adviser Planning, Dept. of the Environment & Local Government

Ms. Patricia CurtinFÁS

*Ms. Sheila HuntKPMG Management Consulting

Mr. Conor KellySimon J. Kelly Architects

Ms. Valerie MulvinMcCullough Mulvin Architects

Mr. Bill NowlanChartered Surveyor & Management Consultant

Mr. David SlatteryArchitect/Historic Buildings Consultant

Mr. Senan TurnbullArea Development Management Limited

Mr. Jim WalshCombat Poverty Agency

*Mr. Raymond Burke, KPMG Management Consulting, replaced Ms. Sheila Hunt on and from the tenth meeting.

1

APPENDIX 4

INCENTIVES APPLICABLE UNDER 1999 URBAN RENEWAL SCHEME

RELIEFS FOR RESIDENTIAL ACCOMMODATION

RESIDENTIAL DEVELOPMENT
Owner-Occupier / New Construction:
5% of construction costs per annum over 10 years against total income
Refurbishment
10% of construction costs per annum over 10 years against total income
Investor/Lessor
"section 23/27" / "Section 23" relief
i.e. up to 100% of construction cost in year 1 set against Irish rental income