The Resource Management (Simplifying and Streamlining) Amendment Bill (the Bill) was introduced to Parliament on 19 February 2009, and follows various government announcements and substantial public interest in the proposed changes. The Bill proposes significant changes to the Resource Management Act 1991 (RMA) in an attempt to simplify the processes surrounding plan development and consent applications in New Zealand.
Broadly, the government's reforms are intended to:
- Fast track nationally significant projects.
- Limit challenges to planning instruments.
- Streamline application processes.
- Streamline decision making processes.
- Remove frivolous and vexatious appeals, and those brought by trade competitors.
- Improve compliance through increased penalties.
- Improve the use of national instruments.
Now that the Bill has been released, the precise mechanisms for achieving the goals of the reforms are known. Undoubtedly, these details will be closely considered by key stakeholders. The next step is for submissions to be heard by the Select Committee which is required to report back to Parliament on or before 19 June 2009. The closing date for submissions is 3 April 2009.
The key reforms and their implications are set out in this Update.
NATIONALLY SIGNIFICANT PROJECTS
The most publicised reform, and the one which has provided most political mileage for the government, is the proposal to fast track projects of 'national significance'. Under the current RMA regime, the Minister for the Environment has the power to call in proposals of national significance which may then be referred to a Board of Inquiry or Environment Court. The Bill proposes to enlarge this power by:
- Establishing an Environmental Protection Authority (EPA), to which applications for projects of national significance can be made directly.
- Widening the scope of projects of national significance to include projects that relate to a network utility operation which extends to more than one region.
- Empowering the EPA to refer applications to a Board of Inquiry, or to the relevant local authority to be processed under the normal processes.
The main issue associated with this proposal is its impact on public participation, particularly by removing the first instance Council hearing. It is anticipated that public interest and community groups will raise this concern before the Select Committee. The main ground for this is likely to be the loss of the benefit of a Council hearing in encouraging public involvement, as Council hearings tend to be less daunting than those of the Environment Court or the EPA (for instance, the prohibition on cross examination of witnesses and the absence of costs sanctions). Another concern may be the loss of the claimed benefits of good decision making provided by a potential dual hearing regime. However, given that the power already exists to call in projects of national significance, the main difference is the expansion of the scope of projects which would qualify. Wind farm proposals in particular, and other energy projects, will benefit from the widened scope of nationally significant projects.
CHALLENGES TO PLANNING INSTRUMENTS
The Bill proposes limiting appeal rights in respect of plans and policy statements to questions of law only, unless leave has been obtained from the Environment Court to extend the scope of the appeal. Under the current regime, the Environment Court considers the planning merits of planning instruments which are appealed.
The main issue associated with this proposal is that it places heavy reliance on the quality of territorial authority decision-making. A concern is that the benefit of the Environment Court's second and expert opinion would be lost, particularly given that there are invariably amendments made to planning instruments during the appeal stage.
Significant changes to the Council hearing process might also be required. At present, there is no cross examination during Council hearings but a move to limit rights of appeal might also require more rigorous testing of evidence at Council hearings. If so, the first instance hearing before the Council is likely to become more like a court hearing, adding to the formality of the process and leading to increased costs for Councils and other parties involved. In determining whether to grant leave to widen the appeal, the Court will consider whether a Council's decision has a significant impact on property rights, fails to give effect to Part 2 of the RMA or is unclear in meaning or effect. The second criterion may well give rise to a requirement to consider the merits of the decision appealed against in order to determine whether it can be appealed on the merits.
APPLICATION AND PLAN PROCESSES AND NOTIFICATION
A major plank of this round of reform is to streamline consent and planning processes. The Bill proposes a number of changes to the existing regime including:
- Neutralising the current presumption in favour of notification of resource consent applications.
- Removing the non-complying activity category of activities so that these activities become classified as full discretionary activities.
- Limiting the ability of consent authorities to make repeated requests for further information.
It is difficult to know whether the emphasis on non-notification will bring any practical changes because the vast majority of applications are already non-notified. As with nationally significant projects, the main issue is likely to be the perceived impact on public participation. Removing the non-complying activity category will also reduce a Council's ability to send a clear message about the appropriateness of certain activities, particularly given the limited application of the prohibited activity classification. Objectives and policies in plans may therefore assume more importance in that regard, and perhaps deal more specifically with certain activities.
The changes to plan development processes include:
- Removing the requirement for local authorities to summarise submissions and call for further submissions on proposed policy statements and plans.
- Enabling the Regional Council and all local authorities of a region to combine to produce a single RMA planning document.
- Removing the requirement for local authorities to automatically review their plans every 10 years.
- Providing that rules and proposed plans have no legal effect until the decisions made on submissions have been notified.
The main concern associated with removing the requirement to seek further submissions is that it will increase arguments over the scope of submissions and relief sought, and the ability of parties to meaningfully participate in unanticipated issues raised by other submitters. Allowing more consequential amendments might well be required to ensure the process runs efficiently.
Suspending the legal effect of proposed rules until submissions have been decided will reduce a Council's ability to manage activities through plans with immediate effect. An implication might be a rush of applications to take advantage of the ineffectiveness of proposed rules.
The Bill proposes streamlining the decision making process by introducing a number of measures including:
- Providing the ability for applicants or submitters to choose whether they have a notified application considered by elected representatives of a consent authority or by independent commissioners.
- Enabling applicants to request that their application be referred directly to the Environment Court.
- Removing the Minister of Conservation's decision making powers for restricted coastal activities.
A panel of independent commissioners may assist in ensuring transparency of decision making and better decision making at Council level. However, the cost of the commissioners would be borne by the person who made the request, a matter which is likely to deter submitters doing so. The opportunity to request direct referral is likely to be of benefit to applicants and submitters by reducing the need for two hearings in cases where an application is likely to end up in the Environment Court in any event. However, as with calling in nationally significant projects, the issue of public participation arises. It is also unclear what criteria a Council will apply to a direct referral request, given the Bill is silent on this.
FRIVOLOUS AND VEXATIOUS APPEALS, AND THOSE BROUGHT BY TRADE COMPETITORS
There has been a lot of publicity about the proposal to remove anti competitive and frivolous objections and appeals. The Bill proposes to address this issue by:
- Increasing the filing fee for environment appeals from $55 to $500.
- Reinstating the Environment Court's power to award security for costs.
- Preventing trade competitors from filing submissions and participating in hearings unless they are directly affected by potential adverse effects of the proposed activity.
- Allowing applicants to potentially recover all damages associated with an appeal brought by a trade competitor.
- Extending the prohibition on considering 'trade competition' to include 'the effects of trade competition'.
To date, trade competitors have not been denied the opportunity to participate if they raise legitimate RMA issues. The Bill now proposes a more restrictive approach. The main issues associated with the proposed amendments are that at least some may have a general effect on public participation in the resource consent process, rather than an effect on trade competitors per se. For example, the increased filing fee will affect all of those appealing to the Environment Court and a requirement to provide security for costs may deny certain groups access to justice rather than discouraging unmeritorious appeals.
It is unclear what the intended or actual implications of extending the trade competition prohibition to include its 'effects' will be. This may have an impact on the relevance of 'distributional effects' on town centres.
Maximum fines under the RMA were set at $200,000 in 1991 and have not been changed since the RMA came into force. The Bill proposes:
- Raising the maximum fine for an offence from $200,000 to $600,000 for corporate offenders and to $300,000 for private individuals.
- Enabling enforcement action to be taken against the Crown by local authorities.
- Giving the Environment Court power to require a review of a resource consent held by an offender.
The aim of the amendments is to promote greater compliance with resource consents. However, it is important to note that the maximum fines have rarely been imposed, although the increase in the maximum is likely to increase the average fine.
The current RMA regime provides for national policy statements (NPSs) and national environmental standards (NESs). These are tools which the government can use to provide direction on specific national, regional or local issues. The Bill proposes improving the process associated with national instruments by:
- Providing the Minister for the Environment and Minister of Conservation with powers to cancel, postpone and restart an NPS process that has already commenced at any time before it is gazetted.
- Enabling NPSs to direct that a local authority must change the provisions of their policy statements and plans without the need for formal planning processes.
If greater use is made of national instruments, this may help to simplify resource management processes. One benefit of the proposed changes is that the significant costs Councils face in implementing new NPSs and NESs due to plan change processes might be reduced.
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