Tim Quilty has accused Wodonga Council of allowing certain developers to avoid paying fees as part of its work to grow the Leneva-Baranduda area, which could potentially add up to millions of dollars.
The Liberal-Democrat MP, and former Wodonga councillor, used Parliamentary privilege to make the controversial comments and call for the Victorian government to introduce ways to detect and report council corruption.
The Leneva-Baranduda precinct structure plan (PSP) was approved and gazetted by the Victorian government in April this year, paving the way for 1000 hectares of land to be used as Wodonga's next growth area.
The council says this will include 6000 homes plus schools, community centres, the Baranduda Fields sporting fields, cycling and pedestrian networks, and local parks.
But Mr Quilty told Parliament on Wednesday evening that the plan was not made in the public interest, pointing out its "extremely contorted boundaries".
The plan shows parcels of land along Baranduda Boulevard that have been earmarked for housing estates, parks and sporting precincts, plus another section of land south of Boyes Road.
This southernmost section stands out because it is surrounded by other sections of land that are not included in the precinct structure plan.
There are also housing developments to the north of the official PSP.
"The PSP only makes sense when you look at who owns the parcels of land that were left out, that were detoured around," Mr Quilty said.
"How the boundaries were drawn is important because developments inside the PSP must pay developer contributions to cover the millions of dollars of infrastructure to build the communities, while those outside it do not, even if they benefit from the infrastructure."
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Asked by The Border Mail why the precinct structure plan was drawn up with those boundaries,Wodonga Council chief executive Mark Dixon said the "boundaries in the plan are based on land holdings".
"Property boundaries provide a logical framework for a PSP over topographical features, which can split land holdings for the future development of an area," he said.
Part of the plan includes the construction of intersections - including traffic lights at the intersection of Baranduda Boulevard and Boyes Road, and a roundabout at a new intersection of Boyes Road and a new road to be built.
Mr Quilty said these two particular intersections would cost $7.8 million and "almost entirely benefit these land parcels that were left out".
He said during his time as a councillor, the Victorian Planning Authority and Wodonga Council each told him that the boundaries were set by the other party.
"Eventually you may wonder whether the VPA is also complicit or too incompetent to act as a check against developer corruption," he said.
"People should ask whether Wodonga Council has collected the developer contributions it is required to under existing section 173 agreements, and if it has, where has the money gone?
"Why is there potentially a multi-million dollar shortfall in developer contribution reserves?"
The developer contributions will be collected at the sub-division stage and be put towards recreation, transport and drainage infrastructure.
Mr Dixon said the plans include "rigorous costings for major development and community infrastructure" and the developer contributions will be included in financial statements to be audited by the Victorian Auditor-General's Office.
Mr Quilty asked Planning Minister Richard Wynne to provide the VPA with a mechanism to detect and report council corruption when reviewing plans.
"Many government decisions relating to developers are tainted by corruption."
This is not the first time Mr Quilty has used Parliamentary privilege to attack Wodonga Council over its handling of developments.
Mr Dixon said it would have been more appropriate for Mr Quilty to issue his complaints through the Ombudsman or Independent Broad-based Anti-corruption Commission than raise them in Parliament.
"As we have stated previously, it's disappointing that Mr Quilty, a former member of the council and someone who represents our community, has again used Parliament and his position to cast unsubstantiated aspersions on this city," he said.
"We would prefer Mr Quilty to focus his time and efforts on working with council to deliver positive outcomes for our community and its residents."