What is the road occupation charge?
The Victorian Government is introducing a major initiative to reduce traffic congestion in inner-city Melbourne by charging private parties a fee to occupy arterial roads for private use. The fee will be called the road occupation charge and will be managed by DoT.
When and where will the road occupation charge apply?
The road occupation charge will apply to inner-city Melbourne arterial roads and applies from 29 June 2020 for road occupations occurring after 20 July 2020.
Why is DoT introducing the road occupation charge?
When private parties occupy arterial roads it can have a negative effect on our road network. It contributes to traffic congestion, reduces community access to amenities, adversely affects the reliability of public transport and compromises the safety of pedestrians, cyclists, workers and the community.
The road occupation charge will create a financial incentive to encourage private parties to occupy roads in a more efficient way, minimising disruption to traffic and the community.
Will the road occupation charge apply to the whole of Victoria?
The road occupation charge will be applied to inner city arterial roads in Melbourne. It will extend as far as Beaumaris in the south east, Balwyn North in the east, Glenroy in the north west and Kingsville in the west.
View the suburbs for which the Road Occupation Charge will apply.
Other metropolitan and regional areas will be monitored to determine the need for congestion reduction using the road occupation charge.
What’s an example of a situation where the road occupation charge might apply?
There are a number of situations in which the road occupation charge might apply.
In the case where a property developer needs to block off an arterial road lane during construction of an apartment building, for example, that developer would be required to pay the Road Occupation Charge. The road occupation charge would also apply to a company using an advertising sign on private land next to an arterial road if it needs to close a lane of traffic in order to change the advertising content or to a demolition company that needs to close a lane of traffic to safely raze a building.
These are examples only and there are other circumstances under which the road occupation charge might apply.
Who will need to pay the road occupation charge?
The charge will apply to private parties occupying arterial roads.
What is a private party for the purpose of the road occupation charge?
A private party is a company or individual that wants to occupy an arterial road for private benefit.
This doesn’t include road occupations for MTIA projects such as level crossing removal.
If the occupation goes over two councils (i.e. the border between two council areas is within the occupation zone), does the charge apply?
Yes, as long as the occupation affects an arterial road lane the charge will apply.
Who is excluded from paying the road occupation charge?
Members of the public temporarily occupying a road while moving house or conducting renovations on their home will not have to pay the road occupation charge. Emergency services are also excluded from paying the charge.
What is an arterial road?
An arterial road is a road in Victoria for which the Department of Transport is the responsible road authority. These roads provide the principal routes for moving people and goods between major regions and population centres. Most other roads are either municipal roads, managed by local councils, or privately operated roads - for example, Eastlink and CityLink.
You can find out what is and isn’t an arterial road here.
Are private parties required to pay a charge for occupying a municipal road?
Councils may have an operating model or application process that could be applicable for private parties occupying a municipal road. We recommend that private parties contact the relevant council if they’re not sure about work they’re undertaking that affects a municipal road.
What does the road occupation charge cost?
The road occupation charge is between $173 and $252 per lane per day.
How is the road occupation charge calculated?
The road occupation charge is calculated based on these factors:
- How many lanes are being occupied
- How long the occupation will last for
- The importance of the road
- The value of the location to the community.
In addition to what might be considered ‘standard’ vehicle lanes, the road occupation charge takes into consideration bicycle lanes and the area between a parking lane and road lane that is used by cyclists and motorcyclists.
Are there other charges associated with the road occupation charge?
Private parties are also required to pay a compulsory bond of $10,000. This is an incentive to ensure the roads are restored to their original condition in the case that damage occurs during occupation.
Who pays the license fee and bond?
While the traffic management company will initially apply for the occupation on behalf of the private party, the license fee and bond will be paid by the private party responsible for the occupation.
Who is a party to the license?
The private party responsible for the occupation is the party to the license.
If a private party needs to make an application that will be affected by the road occupation charge, when should they submit it?
Applicants should allow 20 working days prior to start of works to process a standard application.
How will the road occupation charge be monitored?
The Department of Transport will provide surveillance of road occupations to ensure compliance with the road occupation charge.
How do we know the road occupation charge will help reduce congestion?
A trial of the road occupation charge took place from 1 June 2018 to 31 December 2018 in Melbourne’s inner north and east.
During the trial, 26 road occupations were identified in the trial area. The application of a road occupation charge during the trial resulted in a reduction of road occupation periods by an average of 75 per cent.
The recommendation from the trial was to roll out road occupation charges throughout inner-city Melbourne.
Are there similar schemes elsewhere around the world?
A similar model was introduced in June 2012 by Transport for London. The Transport for London lane rental scheme covers 56 per cent of the Transport for London Road Network. It was a daily charge introduced to encourage behaviour change and minimise highway occupation.
Legal note: VicRoads’ power to charge for the occupation of arterial roads exists under Schedule 5 clause 9(1) of the Road Management Act 2004.