Greenline project’s hidden funding plan may sting businesses

Lord Mayor Sally Capp’s pet project already has a funding black hole of $200m, but new documents reveal how Town Hall may plan to claw back cash from businesses.

Property owners and businesses along the north bank of the Yarra River may be hit with extra rates or special charges to help pay for Melbourne Lord Mayor Sally Capp’s pet project – the Greenline.

The business case for the Greenline, obtained by the Herald Sun through Freedom of Information laws, shows funding for the $316m project includes a component of value capture, along with contributions from the state and federal governments.

Another revelation of the business case was the Town Hall investigated undergrounding the rail lines at Flinders St Station as part of the Greenline project, despite public transport solely being the responsibility of the Victorian Government.

An artist impression of the proposed Greenline project. Picture: Supplied

The business case recommended against undergrounding the rail lines as it had a high chance of exceeding the budget and timeline for the project.

It was ranked the lowest out of all potential scenarios in the business case, which included options that only delivered sections of the project.

Value capture is a broad term but generally includes special charges or rates from property owners or special interest groups that may financially benefit from a proposed infrastructure project.

The potential for using value capture as a revenue-raising method may be critical for the City of Melbourne to deliver the project as the Victorian Government has not contributed to the project and Canberra has only committed to $20m in funding.

Lord Mayor Sally Capp has long championed the project. Picture: Luis Enrique Ascui

The ratios of what Town Hall expects to receive from each level of government and value capture were blacked out when the business case was provided to this masthead.

The Greenline currently has a funding black hole of more than $200m and is not due to be completed until 2030 at the earliest.

A City of Melbourne spokesman said the council considered a range of options for the Greenline project to deliver the biggest benefits for the cost to the community and denied special charges or rates would be used to deliver the project.

“We’re continuing to pursue funding partnerships with government, businesses and key stakeholders to deliver this city-shaping project,” he said.

“There are no plans to raise rates or charges to fund the Greenline Project.”

However, the spokesman refused to answer follow up questions from the Herald Sun about why value capture was listed in the business case and how the project would be funded.

Victorian Chamber of Commerce and Industry chief executive Paul Guerra said the council needed to demonstrate to the community how the unfunded Greenline project would be delivered.

“Any proposed Greenline project funding should not reduce funding for more necessary projects that would benefit from the council’s immediate attention, including making the city more accessible, cleaner and safer,” he said.

The project is not due to be completed until at least 2030. Picture: Supplied

Council Watch president Dean Hurlston said Ms Capp and Town Hall should focus on their core areas of responsibility.

“The City of Melbourne is more than ambitious, it is distracted and failing at delivering the basics,” he said.

“Sally Capp and the City of Melbourne thinking that Greenline will fix Melbourne while failing to understand what has driven people out of the city is laughable.”

The business case claims there will be significant economic benefits from prioritising more walking and cycling along the river’s edge.

“Walking interventions can increase the number of people entering shops and trading by up to 40 per cent, and retail rents by 20 per cent,” the report said.

Despite not commencing, the project has already been delayed by at least two years from its previously announced completion date of 2028.