Dept proposes betterment fee in infra project areas

The cash-strapped Urban Development Department has proposed to impose betterment fee on properties which fall within a 500-metre to one-km radius where its infrastructure projects are implemented in the city.

In return, the government will allow property owners the choice to convert their residential plots into commercial spaces without having to go through any tedious land conversion procedures.

The department has proposed to collect a maximum of one-third of the appreciation cost of the property as betterment fee.

An official source told DH on the condition of anonymity that the department had prepared a detailed note on the proposed betterment fee. “The note will be placed before the Cabinet for its approval. The subject is likely to come up before the Cabinet on Wednesday,” he said.

“When any mega project like the light rail system or the Metro is implemented, areas falling within 500 metres to one-km radius enjoy direct benefit. Under the new proposal, betterment fee will be levied on these areas,” government sources told DH.

Explaining the rationale behind collecting betterment fee, the official said: “Whenever a mega project like the light rail system or the Metro is implemented, the property value increases in areas within 500 metres to one-kilometre radius. So, there is nothing wrong in collecting a fee as such projects benefit property owners.”


Moreover, the official said, there were provisions in the Karnataka Town and Country Planning Act and the Bangalore Development Authority Act to levy betterment fee. “Initially, the betterment fee will be restricted to areas where projects are coming up in Bengaluru. Later, depending upon the success rate, it will be implemented across the state,” the source added.

Why now?

Various civic agencies had tabled many infrastructure projects at the Global Investors’ Meet held in February. Projects like the peripheral ring road, mono rail, high-speed rail link, elevated corridors and the Bus Rapid Transit System failed to attract the attention of many investors for immediate implementation.

Due to lack of budgetary allocations, the government, too, is unable to take up these projects, sources said.