Friday, August 7, 2015

Land Assembly Techniques

There are various techniques through which Land for development can be assembled; although land acquisition and purchase are simple and straight methods but in between these two, there are several other models of land assembly, which are being used in different States.

The UDPFI (Urban development plans formulation and implementation) guidelines classify these as: Land pooling and distribution schemes, popularly known as town planning schemes. Let us take a look at how in past in other states the same has been done.

Town Planning Schemes – the Gujarat experience 
The basic concept of Town Planning Schemes is pooling together all the land under different ownerships and redistributing it in a properly reconstituted form after deducting the land required for open spaces, social infrastructures, services, housing for the economically weaker section, and road network. This process enables the local authority to develop land without fully acquiring it and gives it a positive control over the design and the timing of the urban growth. This method is extensively practiced in Gujarat and Maharashtra, selectively in Kerala and occasionally in Andhra Pradesh and Tamil Nadu. To achieve the ultimate objectives of the Development Plan, Town Planning Schemes are prepared for smaller areas of about 100 hectares. Implemented under the Maharashtra Region and Town Planning Act, 1966 in Maharashtra and under the Gujarat Town Planning and Urban Development Act, 1976 in Gujarat. Since the reconstituted plot has better accessibility and good potential for development, its value gets enhanced. Part of such increment in land value is contributed for the cost of development work in the scheme. The landowners get the net amount of increment value of the plot worked out after deducting the amount of compensation payable for the loss in area. 

Haryana Model 
Haryana experimented with a new model of land assembly under the Haryana Development and Regulation of Urban Areas (HDRUA) 1975 permitting, under grant of license from the DTP, private developers to assemble lands from the market through negotiations and develop these to build residential colonies. Private developers are allowed to negotiate on market price with agricultural and other landowners to buy land. Private colonizers prepare layout plans for integrated development of residential areas, with their internal infrastructure considering the space norms specified in the city’s development plan. A developer is required to reserve 20% of housing for EWS and LIG, another 25% can be sold in the market on “No Profit No Loss” basis, while the rest 55% can be sold freely in the open market. The developer is required to pay to the HUDA, in proportion of its development costs for a colony, “External Development charges” (EDC) for getting connected to the HUDA’s trunk lines of utilities and “Infrastructure Development Charge” or IDC for citywide infrastructure development. The DTP is the nodal agency for regulating the functions and activities of the licensed private developers including checking their income and expenditure.

Ghaziabad Model 
GDA Model has been implemented for developing land and constructing houses under Urban Planning and Development Act, 1973. Basic reason is to make funds available for infrastructure development. It is envisaged as a joint venture between Ghaziabad Development Authority and private developer. The equity sharing between the GDA and the private developer is in the ratio of 10:90. This reduces the cost burden on the Authority. The compensation package streamlines implementation by reducing the 
litigations and constraints of the traditional land acquisition process. The private developers earn revenue from sale of 60% of plots in free 
market. The model is attractive for the Development Authority as apart from the 
less investment, and free of cost facilities, it earns annual revenue of 1% 
from the private developer (tie up cost index).

Noida Model
Farmers/ landowners are given certain compensation. Compensation rates are determined irrespective of location. These Compensation rates are revised after every financial year by linking them to “consumer price index”. A separate rehabilitation package in the form of additional 15% on basic land acquisition rate along with land compensation @ 1/5 of actual plot value. Development levies are charged from villagers.

Relevance of the Models to Delhi In view of the fast pace of development that Delhi needs in order to cater to the rapidly increasing population, a model of land development is required that is replicable and applicable on a large scale of 1000 hectares and above. Also, the model should not be confined to the residential pockets only. In the case studies (excluding the Noida model), scale is limited up to 100 or 80 hectares and that too within the residential pockets. The viability of replicating and up-scaling these models were assessed. The Haryana and Ghaziabad models provide for a reservation of 20% of plots for EWS/LIG. However, it needs to be considered whether this quantum of provision in Delhi’s context would be sufficient. It was to be seen whether the linking of compensation rates to the consumer price index as in the case of Noida, can be worked out in Delhi. Be it the TP schemes, or the Haryana and Ghaziabad models, the provision of infrastructure is limited to the layout level and does not take into account the Master Plan/Zonal Level facilities.

AMDA (Association of Urban Management and Development Authorities) Model for Delhi

AMDA proposed a “land pooling cum barter model” for development within the planned project areas in Delhi, the main features of which are: To ensure rational and attractive returns to the farmers. This can be achieved by returning net residential developed land upto 16% land under notification of section 4 surrendered to DDA by the landowner. This leaves upto 84% of land with DDA to meet the plan requirements. DDA gets 100% of the land for an area earmarked for development in lieu of the net 
residential land upto 16% returned to the landowner within a developed area. 16% of the land given for barter is based on the plan prepared and executed by the 
DDA and the conditions mentioned in the plan will be applicable. In the 84% of the land remaining, DDA develops all housing for EWS and part of the total DUs for LIG along with all the facilities at Master/Zonal plan level.

The landowner on the other hand has to provide all housing for HIG and MIG and a part of the total DUs for LIG in the land returned to him. Through this the model seeks to achieve the 
social equality of land. The landowner does not feel deprived of his land when he is given compensation in terms of land and he is also left with numerous options like: Retaining the land with him, to partially or totally dispose the land, waiting for land prices to rise in the market and selling to developers at market rates. Coming forward as a promoter,
 The barter system takes into account the entire spectrum of development, including the 
facilities to be provided at Master Plan/Zonal Plan/Layout level. 

AMDA also advised change in the institutional setup of DDA. The existing institutional mechanism under the DDA dealing with acquisition/development and disposal of land is highly centralized and has not been kept pace with provisions of Master Plan. Therefore, the following changes were suggested: Decentralize land assembly, development and disposal. Establish an autonomous body to monitor and regulate land acquisition/development 
and disposal under DDA Act.

Towards a New Land Pooling Policy(LPP) for Delhi

Since future land availability potential to accommodate the needs of future lies in urban extension areas, planned development of these areas was deemed essential. A study on evaluation of different models of land pooling in Delhi was commissioned by DDA. NCAER (National Council of Applied Economic Research) studied 3 alternate models of land pooling including financial evaluation based on data from 11 recently developed DDA projects and information from leading private developers in and around Delhi. Since infrastructure development also requires resources, PPP model was suggested in order that public authorities are able to recover external development charges (EDC) so that all essential services can be extended to the proposed urban extension areas.

The new land pooling policy was notified as alternative to land acquisition, with active involvement of the private sector. It has been incorporated as Chapter 19 of the Master Plan Review. Shall cover more details about the LPP and master plan in next post.

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