A future rail tunnel from Newport to Clifton Hill via Fishermans Bend and Southern Cross station could be partly funded by households near the rail corridor, according to Victoria’s key infrastructure advisory body.
An Infrastructure Victoria report flags a proposal for up to a quarter of the estimated $19 billion cost of the Melbourne Metro 2 project to be borne by landowners who would directly benefit from an estimated $20 billion boost to land values.
The “betterment levy”, starting at an average of $435 a year for residential properties, would be applied for 30 years to households and businesses within a kilometre of train stations in the Werribee corridor.
The proposal has been outlined in the independent authority’s draft 30-year infrastructure strategy, released last week, which lists the second Metro tunnel as a medium to long-term priority to be delivered in the next 15 to 30 years.
Infrastructure Victoria chief executive Michel Masson said that while the Melbourne Metro 2 tunnel project might have merit, it required further investigation.
“While our evidence is clear that there is a need for a further significant uplift to rail capacity on the Mernda, Sunshine and Werribee corridors over the long term, the proposed solution comes at a very high cost and all possible alternatives need to be identified and tested first,” he said.
Consultation on the draft strategy closes on October 31 before the final 30-year infrastructure strategy is delivered to State Parliament in December.
Asked whether the government would consider applying a betterment levy on the Metro 2 project, a spokesman for Public Transport Minister Jacinta Allan said the final report’s recommendations would be fully considered as part of the government’s five-year infrastructure plan, which is to be released in the middle of next year.
“We’ve ruled out a levy on existing properties to fund the [first] Metro tunnel and our unprecedented pipeline of major public transport projects, including 50 level-crossing removals,” he said.