Transport Dept savaged for ‘disgusting’ treatment of businesses compulsorily acquired for road upgrades

Angry businesses have tipped a bucket on the Transport Dept over its handling of compulsory acquisitions for road upgrades.

Businesses compulsorily acquired for road upgrades have been left out-of-pocket and unable to find suitable new locations, a report has found.

Parliament’s Public Works Committee has in response recommended a special unit be established to support acquired businesses.

The committee, which looked into acquisitions at five intersection projects, heard evidence from businesses including Castle Motors at Norwood, which had its premises acquired in 2020 to make way for the Portrush and Magill roads upgrade.

Owner Sonya Rosella said a formal Notice of Intention to Acquire Land was received two months late because the Department for Infrastructure and Transport (DIT) sent it to the wrong location.

Demolition works at the Portrush/Magill roads intersection in 2020 for the upgrade. Picture: Tait Schmaal

Ms Rosella said the Commissioner of Highways also failed to inform them of a Supreme Court suit had been served against them – which she described as either “trickery by using the element of surprise, or incompetence”.

The Norwood business also paid about $100,000 in relocation costs upfront and then waited months before the DIT reimbursed them.

“The manner in which DIT treats those being acquired is disgusting,” Ms Rosella said.

The report said the “complexity of valuing businesses” meant a separate unit within DIT should be established to provide tailored support and analyse more of the economic impact on the state.

The committee’s report made a total 13 recommendations to Transport Minister Tom Koutsantonis, including a change to laws to clearly state sales after acquisition are also valid in determining the market value of a property.

It found DIT valuations relied heavily on comparable sales prior to acquisition, which left owners vulnerable to underpayment and unable to find a comparable property if the market boomed after acquisitions.

A former member of the committee, Mr Koutsantonis said he commissioned the inquiry that looked into acquisition processes under the former Liberal government.

He said the government would consider all relevant recommendations.

“We have been very clear that these acquisition processes — whether for homes or businesses — involve wielding some of the strongest powers available to the government, and that must be done as sensitively and efficiently as possible,” he said.

“We are working systematically to ensure the right processes are in place.”