A new territorial management instrument to support the economic and financial sustainability of urban planning

Abstract

This communication reports the assumptions, methodology, outcomes and conclusions of aresearch I recently carried out for the Portuguese Department of Territory. It meets one of themost relevant goals of the Land, Territorial Ordinance and Urbanism Act (currently underrevision) that states the importance of the economic and financial sustainability of urbandevelopment operations for municipalities.As land values rise as a result of territorial planning decisions, a public intervention isrequired in order to assure that these surplus-values are allocated on behalf of the populationŽssocial interest. So the new territorial management instrument herein proposed consists incharging a 20% fee on land surplus-values that result from the assignment by urban plans ofspecific building capacities to certain urban interventions. The proposed methodology isapplied to the Urban Development Plan of the Planning Unit 11 of the municipality of Lagoa,located in the Algarve, Portugal.This new territorial management instrument may be easily applied to other municipalities,within the scope of the application of different kinds of urban plans. It ensures that thesurplus-values they engender are pointed to social purposes. And it further supports municipaleconomic and financial sustainability based on a strategic and integrated planning perspective