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Calculating the road development contribution: How to proceed

If the roads get worse and worse, sooner or later the municipality will plan and implement a renewal of the carriageway. However, it does not bear the costs for this alone: ​​it can shift a not insignificant portion of the costs to the residents through the road development contribution. Read here to what extent this is possible and how you can calculate the road development contribution yourself.

Calculating the road development contribution: How to proceed
Calculating the road development contribution: How to proceed

What is the road development contribution?

The road development contribution or road construction contribution, or “Strabs” for short, is a municipal levy. It has to be paid by residents for road construction or road drainage measures.

The road development contribution is legally justified in the municipal tax laws (KAG) of the federal states and in the local statutes of the municipalities. However, the levy is not planned in all federal states, in some the abolition has already taken place.

Which federal states levy the road development contribution?

Currently (as of May 2020) a road upgrade fee is payable in these federal states:

  • Bremen
  • Hesse
  • Lower Saxony
  • North Rhine-Westphalia
  • Rhineland-Palatinate
  • Saarland
  • Saxony
  • Saxony-Anhalt
  • Schleswig-Holstein

In the following federal states there is no longer any road construction contribution:

  • Baden-Württemberg (never)
  • Bavaria (since 2018)
  • Berlin (since 2012)
  • Brandenburg (since 2019)
  • Hamburg (since 2016)
  • Mecklenburg-Western Pomerania (since 2018)
  • Thuringia (since 2019)

Who has to pay the road development contribution?

For the road development contribution, all direct property owners of the road who gain an advantage through the measure will be used. This includes owners as well as leaseholders or beneficiaries. It is assumed that this group of people will benefit from the improvements, so that participation in the costs is justified.

The measure is always assumed to be advantageous for a property if the property can be approached by vehicles for supply or disposal via the road in question. But also properties that lie behind it, so so-called hammer properties or also backbone properties, benefit from it, so that their owners, leaseholders and beneficiaries have to make the road expansion contribution.

Road development contribution: special case corner property

If a property is located on a street corner, it is generally assumed that it will also benefit from the measures in both streets. Thus, if necessary, two road expansion contributions would be levied here if improvement measures were to be taken in both roads.

How do one-off and recurring road development contributions differ?

As a rule, residents of the street affected by the construction project are asked to pay once for the costs incurred. Alternatively, according to the KAG, the municipalities are sometimes allowed to demand recurring road development contributions. These are not only paid by those who live directly on the street, but also by all local residents. For this purpose, the municipality allocates all apportionable costs to all residents, including those whose property is not directly on the street concerned. This procedure significantly reduces the amount to be paid for each individual citizen. The amount to be paid annually is also easier to calculate.

What share of the costs does the municipality assume?

If a measure is to be carried out in a street, part of the total costs are usually borne by the municipality, the other part is borne by contributions from the residents.
The amount of the costs distributed between residents and the community can be found in the respective community statutes. Two things are decisive here:

  1. What kind of action is being carried out?
    The type of measure is essential, as certain projects per se require the municipality to contribute more or less to the costs. While the total costs of the work are generally shared among the residents, special rules sometimes apply to sewer construction work, for example.
  2. What is the significance of the street on which the construction work is taking place?
    The relevance of the street is also essential if the property owner's contribution to the road development is to be determined. The following applies: The lower the percentage of use by residents compared to the total use of the street, the lower their share of the road development contribution. In other words: the more foreign traffic there is, the less residents have to pay.

    For this purpose, the street in question is divided into one of three classes. These classes provide information about which type of traffic predominates in the street and, as a direct consequence, what proportion of the road development costs the municipality pays.

    1st residential street (the municipality usually pays around 25 percent of the total costs)
    2nd main access road (municipality contributes around 40 to 50 percent)
    3rd main road (up to 75 percent is usually borne by the municipality)

Calculation: How much road development contribution is due?

What proportion of the road development contribution actually accounts for each individual resident depends on various factors. These are set out in the municipal statutes. As a rule, these points are decisive:

  1. Property size
  2. Extent of property use (number of floors)
  3. Type of use (commercial or private)

With regard to the number of storeys and the type of use, the information specified in the development plan is used for the calculation. If there is no development plan, the actual conditions apply.

The respective municipal statutes indicate the factor with which the degree and type of use are provided. For example, a single-storey house can have a factor of 1, while a building with two floors has a factor of 1.25 according to the statutes. The three factors mentioned above (size, extent, type of use) are multiplied for each property. This results in the weighted number of square meters.

Then the sum of the weighted square meters of all properties in the street concerned is calculated. The costs to be borne by the residents are then divided by this sum, so that the road development contribution is calculated for each weighted square meter. In the last calculation step, this value is multiplied by the number of square meters of the individual plots, which results in the respective road development contribution.

Formula: How to calculate the road development contribution

  1. Area of ​​property A x factor I (number of floors) x factor II (type of use) = weighted result for property A
  2. Forming the sum of all weighted results (from property A to ...)
  3. Apportionable costs / sum of all weighted results (plots A to ...) = road development contribution per weighted square meter
  4. Road development contribution per weighted square meter * number of square meters of property A = road development contribution for property A

Example calculation 1

The Müller couple have an 800 square meter property at Musterstrasse 3. There is a bungalow on it. This has only one floor, which corresponds to factor I (number of floors) = 1. The house is used exclusively for private purposes, so factor II (type of use) = 1. A measure for 400,000 euros is to be implemented in the street.

  1. 800 square meters x 1 (factor number of floors) x 1 (factor type of use) = 800 square meters weighted area
  2. The sum of the weighted results of all lots in the street is 80,000 square meters
  3. 400,000 euros / 80,000 weighted square meters = 5 euros per square meter of weighted area
  4. 5 euros * 800 square meters = 4,000 euros

The Müller couple must therefore expect costs of 4,000 euros.

Example calculation 2

One of the Müller's neighbors is an apartment owners association. She lives in a two-storey house at Musterstrasse 4 on an 800 square meter property. According to the exemplary statutes, this corresponds to factor I (number of floors) = 1.25. All residential units are used privately, so factor II (type of use) = 1 must be applied. Since it is the same street, the homeowners association is also affected by the measure, which will cost 400,000 euros.

  1. 800 square meters x 1.25 (factor of number of floors) x 1 (factor of type of use) = 1,000 square meters of weighted area
  2. The sum of the weighted results for all properties corresponds, since it is the same street as the Müller's, to 80,000 square meters here as well.
  3. 400,000 euros / 80,000 weighted square meters = 5 euros per square meter of weighted area
  4. 5 euros * 1,000 square meters = 5,000 euros

The homeowners association has to pay 5,000 euros of the road development contribution.

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What is the difference between the road development contribution and the development contribution?

The development contribution is to be distinguished from the road development contribution. This is collected when, for example, streets, squares or green spaces are created for the first time in a new development area. According to the Building Code (BauGB), these development costs must be borne proportionally by the owners of the building sites in the area in question. The road development contribution is due, however, if an existing system or facility is subsequently improved, renewed or expanded.

For example, if a road is being laid out for the first time, a development fee must be paid. If parking bays are set up on this street 30 years later, the residents will have to pay a road upgrade contribution.

Development costs for old roads

Subsequent billing of streets that have been going on for decades is a nuisance for residents
are in use but have not yet been developed. If a repair is carried out here,
the costs for this plus all past costs can be declared as development costs and
90 percent of the costs are passed on to the residents - even if only one meter of pavement has been repaired
or a street lamp is replaced. Since in the municipalities the document retention period
is limited to a maximum of 10 years, there is often no evidence from the time before. In such cases
the courts usually declare generous lump sums admissible. For the affected residents
the situation is often even worse threatening the existence than with the road development contributions.

Can the road upgrade contribution be deducted from tax?

Landlords can use the paid road development contributions in the tax return in the area of ​​"renting and leasing" as income-related expenses. Those who live in the affected property themselves have the option of deducting the costs as a household-related handicraft. However, some conditions must be met for this:

  1. An existing path or road was modernized.
  2. The measure must be able to demonstrate a spatial connection to the household.
  3. The cost of the measure must be divided into labor costs and material costs.

Is it possible to object to the road development contribution?

Residents have the opportunity to object to a decision on the road development contribution within one month. If this is rejected, you can again file a lawsuit within one month.

It should be noted that neither the objection nor any lawsuit filed postpone the required payment. The property owners must therefore first pay the road development contribution if they have not submitted an application for suspension of implementation and this has been granted.

In principle, it is possible for the municipalities to note hardship regulations in the articles of association. Depending on how it is determined in the individual case, contributions can also be made in installments or deferred. It is worth taking a look at the respective statutes.