The Executive Yuan yesterday approved a draft amendment to the Urban Renewal Act (都市更新條例) that would establish a mandatory hearing process and dispute settlement mechanism for contentious reconstruction proposals, while authorizing the government to demolish holdout houses.
There are 8.5 million houses in the nation, nearly 4 million of which are more than 30 years old and might not provide the required earthquake resistance, Premier William Lai (賴清德) said.
“It is therefore necessary to speed up urban renewal to ensure building safety and living quality,” he said.
Photo: CNA
The amendment would establish a three-stage review process to settle reconstruction disputes and allow local governments to demolish properties at the heart of controversial reconstruction proposals to expedite the renewal process.
To prevent property hoarding and speculation, urban renewal projects would have to be submitted to the local government’s urban renewal review committee to determine whether it fits within the city’s overall urban development plan.
A mandatory hearing would be required for any renewal project that fails to obtain the consent of all homeowners involved, after which the review committee would decide on the project based on its necessity and feasibility.
Homeowners would be allowed to seek legal relief should they refuse to have their house included in an approved project.
Local governments would then be able to demolish holdout houses, but they would be required to negotiate with homeowners about the date and the method of demolition, as well as relocation plans.
The amendment also stipulates a more transparent process to award extra floor space in renewal projects as incentive for homeowners.
A renewal project could be awarded an up to 50 percent increase from the original floor space, which could be increased to 100 percent if the project is a large government-led project of more than 10,000m2.
The current mechanism, through which local governments decide how much extra floor space should be awarded, has caused uncertainty for homeowners and developers, slowing urban renewal, the Ministry of the Interior said, adding that the new incentive measure is expected to eliminate such uncertainty.
To encourage urban renewal, the proposed amendment would also include a maximum of 12 years of property tax deductions for reconstructed homes and a 40 percent land value increment tax deduction for participants of renewal projects.
Land developers involved in government-led urban renewal projects would be given a four-year business income tax break.
While a restriction in the Banking Act (銀行法) caps the amount of loans a bank can extend for construction projects at 30 percent of its total loans, the amendment would exempt lenders from the restriction when financing urban renewal projects.
The amendment would also require local governments to offer housing or a subsidy to underprivileged homeowners included in urban renewal projects.
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