Australia: Planning reform introduced in the NSW Parliament: the Planning Bill 2013

Introduction

On 22 October 2013, more than two years after the NSW Government announced once-in-a-generation reforms to the NSW planning system, the Planning Bill 2013 (Planning Bill) and Planning Administration Bill 2013 have been introduced into the NSW Parliament.

This legal update examines the key aspects of the Planning Bill and compares it with the earlier versions of the reforms described in "A New Planning System for NSW - White Paper" (White Paper) and exposure draft legislation (together the White Paper Reforms), which were released for public consultation in April 2013.

Our legal update which analysed the White Paper Reforms proposals can be found here.

Community Participation

The community participation provisions of the Planning Bill are largely consistent with the proposals put forward in the White Paper. The key elements of community participation in the Planning Bill require:

• planning authorities to exercise their planning functions consistently with the Community Participation Charter;
• most planning authorities to prepare a Community Participation Plan (to be publicly exhibited for 28 days), which provides for how they will undertake community participation; and
• the development of a comprehensive online portal to provide access to a number of services.

The clear intention of the Planning Bill is to increase community participation in the plan making process. The removal of the targets for code assessment development and changes to complying development discussed below should also result in an increase in community participation in the development assessment process, from that contained in the White Paper Reforms.

The Planning Bill provides a right for the community to be informed about planning matters that affect the community. Furthermore, the Planning Bill will establish the Community Participation Advisory Panel, the functions of which include providing advice on the preparation and operation of Community Participation Plans, and making recommendations to the Minister with respect to community participation in planning matters.

Transitional provisions provide for interim community participation plans for councils. Specifically, the Planning Bill states that until a council has a Community Participation Plan, or 30 June 2016 (whichever occurs first), the Community Participation Plan that applies is the model council community participation plan designated by Ministerial planning order.

In some respects the community participation requirements have been expanded from those proposed in the White Paper Reforms, most notably through new obligations for planning authorities to publish reasons for decisions, including how community views have been taken into account in making the decision.

The Planning Bill provides further certainty around mandatory requirements, specifically in relation to minimum 28 day exhibition periods for:

• strategic and other plans including draft community participation plans and draft infrastructure plans (discussed further below);
• development applications and other matters such as:
• • Applications for strategic compatibility certificates;
  • Applications for EIS assessed development; and
  • Applications for development consent for State significant development that is subject to merit assessment.

The Planning Bill provides a right to challenge in the Land and Environment Court whether these requirements have been followed.

Some important details regarding community participation are still unavailable, with information such as the form, content and procedures for making and publishing Community Participation Plans (or any amendment of those plans) to be detailed in regulations.

Strategic planning

The Planning Bill maintains the strategic planning framework which was proposed in the White Paper, with four levels of plans namely NSW Planning Policies, Regional Growth Plans, Subregional Delivery Plans and Local Plans.

Sitting under the layer of NSW Planning Policies will be Regional Growth Plans and Subregional Delivery Plans. Regional Growth Plans will focus on integrated infrastructure and land use decisions, whilst Subregional Delivery Plans will identify precincts and locations of significance to the State and the subregion.

Local Plans will provide the legal mechanism to deliver the NSW Planning Policies, Regional Growth Plans and Subregional Delivery Plans. The Planning Bill sets out a clear hierarchy for these plans and requires that the lower order plans, such as Local Plans and Subregional Delivery Plans must give effect to the higher order plans such as Regional Growth Plans and NSW Planning Policies.

Subregional planning boards (new creations proposed in the White Paper Reforms) are maintained in the Planning Bill. They will comprise four Ministerial appointees plus a chair, and one member to represent each Council within the subreqion – however the composition of subregions is still to be finalised, by Ministerial order.

The suite of ten strategic planning principles contained in the White Paper Reforms has been removed from the Planning Bill , replaced by broader, "general considerations" for the preparation of proposed strategic plans. Importantly, however, those principles that remain include requirements that:

• Strategic plans need to be evidence based;
• Planning authorities should have regard to the impact of draft provisions on the financial feasibility of future development; and
• The extent and complexity of provisions of local plans should be proportionate to the likely impacts of future development.

The Minister's powers under the Planning Bill to amend strategic plans without exhibition are now limited. The process for making local plans has been revised in the Planning Bill, so that only the planning control provisions of the local plan will be subject to the "Gateway process". It will now be possible for Councils to make Local Plans, where authorised by the relevant Gateway determination to do so. Previously these provisions were made by the Minister or a delegate.

Land use zones

The White Paper stated that Local Plans will contain "fewer, broader and more open" zones and specifically that the existing zones within Standard Instrument would be replaced with 13 "indicative zones" in the Local Plans.

This reform has been abandoned and the Government has since indicated that all zones existing in the Standard Instrument Local Environmental Plan will be retained in the new system. This will be viewed by some as regrettable given the acknowledgement in the White Paper Reforms that a move to open zones with fewer prohibitions would "provide for greater flexibility and will minimise the need for spot rezonings - which in turn reduces costs, time delays and uncertainty for businesses and the community."¹

The Planning Bill continues to provide for the standardisation of planning controls through standard land use definitions and standard zones contained in Local Plans. There is no indication whether the other reforms to the standard definitions, such as the removal or simplification of "group term" definitions propounded in the White Paper, will be implemented.

Referrals, concurrences and other approvals

The White Paper proposed a whole-of-government review of the existing system of referrals, concurrences and other planning related approvals, with the objective of achieving a 'one stop shop' of additional requirements to be controlled by the Department of Planning and Infrastructure.

The Planning Bill gives effect to these one stop shop provisions by providing that the Director General is to determine whether approval (by another approval body under another Act) should be given, and the terms on which that approval should be given by the other agency. Any consent then granted by the consent authority must be consistent with the terms of approval given by the Director General, and the other agency must then give the approval under their relevant Act in a manner which is "substantially consistent with" the general terms of approval as determined by the Director General.

In response to submissions raising particular concerns about heritage protection, the Planning Bill now provides that the Heritage Council recommendations must always be followed by the Director General except where there is an unreasonable delay or a conflict with another agency cannot be resolved. Similar provisions apply for referrals to the Rural Fire Service. Concurrence requirements regarding threatened species have also been strengthened when compared to the White Paper position.

Other features of the strategic planning framework

One key feature of the Strategic planning framework in the White Paper Reforms was a proposal to replace the current paper-based map system with approved spatial maps, providing greater clarity on the application of relevant controls based on current and up to date information.

The Planning Bill facilitates a greater focus on e-planning with the requirement that strategic plans be published on the NSW Planning Portal. However, Local Plans will continue to be published on the NSW Legislation Website, as is the case presently with Local Environmental Plans.

Development Assessment Tracks, Appeals and Enforcement

Some of the most significant departures from the reforms as previously formulated relate to development assessment, specifically in relation code assessment development and strategic compatibility certificates.

The White Paper proposed "that 80% of all developments will be complying or code assessment within the next 5 years, with reduced timeframes and documentation"². The Government has since confirmed that there will not be any target for code assessment, and instead that code assessable development will only apply in nominated growth areas. Outside those areas, it is expected that councils will be able to determine whether and where code assessment will apply.

Assessment tracks specified in Local Plans

The four categories of development to be included in the assessment tracks identified in the Local Plan are unchanged, namely:

• Exempt development – which will be self-assessed and will continue in a similar manner to the present system;
• Complying development – which will be assessed by an accredited certifier or the relevant Council;
• Code assessment – which will be assessed by Council against performance based criteria as well as "acceptable solutions" for non-compliances with the development guides; and
• Merit assessment – which will be subject to a full assessment carried out by Council.

Previously in the White Paper Reforms, a single development could be the subject of both code assessment and merit assessment. This has been removed with the effect that if a development does not comply with certain aspects of a development code, the entire development will be subject to a full merit assessment.

In addition, there will be an ability for an applicant for a proposed development which contains a minor non-compliance with development guide provisions of the Local Plan to apply to the relevant Council for a "variation certificate" to certify that the non-compliance is a permissible variation. The proposed development can then be approved by an accredited certifier or the relevant Council as complying development.

The White Paper Reforms indicated that an application for a variation certificate would be "taken to be issued" if not determined by Council within a timeframe to be set by the regulations, but this has been removed in the Planning Bill and replaced with provision for the regulations to further limit the standards and requirements for which a variation certificate may be issued.

The Planning Bill also provides for the following further categories of development:

• EIS assessed development –analogous to the existing provisions regarding "designated development";
• State significant and regional development – the existing classes of state and regional development will remain. The Planning Bill also provides for the Minister to "call in" certain development but only if the Minister has first obtained and made publicly available advice from the Planning Assessment Commission regarding the State or regional significance of the development; and
• Part 5 environmental impact assessment, state infrastructure development and public priority infrastructure.

Part 5 of the Planning Bill remains substantially the same as proposed under the White Paper Reforms. One change that has been introduced where an EIS is required is for the Planning Assessment Commission to "provide advice or hold a public hearing" rather than to undertake a "review".

Existing and continuing uses

The Planning Bill maintains the current approach for existing and continuing uses.

Amber light approach

In the White Paper Reforms a consent authority had a positive obligation to advise an applicant of what amendments could be made to a proposal which would allow it to satisfy a merit assessment prior to refusing that application.

This concept has been maintained in the Planning Bill, however the language has been softened so that a consent authority now only has a "general obligation" to advise the applicant of any aspects of the development which may lead to a refusal to grant consent, and any such advice (or failure to provide it) will not bind or affect the consent authority when determining the application .

Strategic compatibility certificates

Whilst the concept of strategic compatibility certificates has been retained from the White Paper Reforms, its practical application is likely to be more limited given the heightened notification and consultation requirements which now apply, and narrower timeframes for acting upon a certificate.

A proposed development which is consistent with a regional growth plan or subregional delivery plan but is prohibited by the provisions of a Local Plan which has not yet been amended to reflect the provisions of the higher order plan, can apply to the Director-General for a strategic compatibility certificate to authorise that development. The Planning Bill provides that a certificate can be issued by the regional planning panel or by the Director General (but in the case of the latter, only if there are not more than 25 objectors and the relevant Council has not objected) .

Where such a certificate is issued, a development application must be lodged within 12 months, and if consent is refused then the certificate ceases to have effect. Further, any consent granted in reliance on the certificate will lapse within 2 years (rather than the usual 5 years) unless work is physically commenced.

Decision makers

The model of decision making under the Planning Bill is largely the same as in the present system. Decision makers under the new system will be as follows:

• the Minister will maintain a decision making role, however, that role is expected to continue to be delegated to the Planning Assessment Commission.
• Regional Planning Panels will continue to be the decision maker for regional development.
• Councils will maintain the decision making role for development assessment, although the Planning Bill provides that a Local Plan may specify that certain types of development must be determined by the an independent hearing and assessment panel.
• the current role of private certifiers to approve complying development will be retained.

Greater connection to e-planning

The Bill proposes that a development consent or complying development certificate will take effect once it is registered on the NSW Planning Portal.

Timeframes

The Planning Bill does not contain many mandatory timeframes with respect to the development assessment process, except for minimum public exhibition and notification requirements. However, there is scope for these to be contained within the regulations. Additionally, the 'deemed refusal' period for a development application will be contained in the regulations.

Modifications

The Planning Bill includes a broad modification power for State significant development.

For other merit assessed development, a consent authority will be able to modify a development consent in much the same way as under the present system, either to correct a minor error or misdescription, or if the consent authority is satisfied that the development as modified will be 'substantially the same', and the modified development is development for which the consent authority can grant consent.

Other obligations in Part 4 (including public notification, the requirement to grant consent to particular code assessable developments, and in respect of conditions), will apply to the modification of development.

Appeals and reviews

Most of the current features of the planning system have been retained in respect of appeals and reviews, including those introduced in recent years, with a few additions and changes. Some key features to note are:

• applicants will be able to seek reviews of decisions made by consent authorities (including Councils, independent hearing and assessment panels, regional planning panels and the Planning Assessment Commission), in similar circumstances to the current system. However, reviews will not be available for all development tracks. Mandatory costs orders will continue to apply when a development application is amended except when made in the context of section 34AA of the Land and Environment Court Act 1979.
• the decision of a consent authority under Part 4, in relation to an application for development consent (or a modification) can be the subject of an appeal to the Land and Environment Court within 6 months of the decision, as is presently the case. This also includes an ability to appeal against decisions by a consent authority regarding something that had to be carried out to the consent authority's satisfaction, as well as compliance with a deferred commencement condition.
• Objectors will have merit appeal rights for EIS assessed development (consistent with current appeal rights for designated development).
• there is no right of appeal in respect of a decision of a consent authority following a public hearing by the Planning Assessment Commission, the determination of (or failure to determine) a complying development certificate, or a decision of a Council to issue, or not to issue, a variation certificate for complying development.

Enforcement and orders

Development control orders will continue to be a feature of the new planning system. Broadly, there are 3 categories of orders that may be issued by enforcement authorities: general orders, fire safety orders, and brothel closure orders. The functioning of this system is largely unchanged from the present orders system, including a right of appeal.

As under the current system, any person will be able to commence proceedings in order to remedy or restrain a breach of the act.

The Planning Bill excludes certain matters from being the subject of legal proceedings, including in relation to the declaration of public priority infrastructure, and specifies that certain provisions are not mandatory and accordingly cannot be the subject of proceedings.

However, in contrast to the position described in the White Paper Reforms, an increased number of public participation requirements are now identified as mandatory (with the scope for the regulations to identify other requirements as mandatory), and hence a failure by the consent authority to comply with these can be the subject of proceedings. Additionally, proceedings to challenge or review approvals of public priority infrastructure will be very limited.

A new criminal offences and proceedings regime will be introduced, with a 3 tier classification system for offences similar to that which exists under the Protection of the Environment Operations Act 1997. The maximum fine for corporations has been increased to $5 million for the top tier of offences, which includes carrying out development without the required planning approval. The Court will also be able to make an expanded range of orders in criminal proceedings.

The Planning Bill provides for aiding or abetting the commission of an offence and this could expand the scope of prosecutions, including for unlawful works.

Provision of Infrastructure

Contributions

The Planning Bill continues to provide that a consent authority will be able to impose, by way of conditions of development consent, any or all of the following contribution types:

• local infrastructure contributions – to fund the provision by council of local infrastructure;
• regional infrastructure contributions – imposed on specified development or a class of development, as a contribution towards the provision of regional infrastructure by the State; and
• biodiversity offset contributions – as a contribution towards biodiversity offsets for the conservation or enhancement of the natural environment of the State.

The following table summarises each contribution type.

A key change made to the Planning Bill since the release of the White Paper Reforms is in relation to the use of local infrastructure contributions by councils. The White Paper Reforms proposed that money obtained from local infrastructure contributions was to be applied within 3 years towards the purpose for which the contribution was imposed, with the potential for the Minister to extend that period by a further 3 years in a particular case.

This timeframe has been amended by the Planning Bill such that the funds are to be applied within 5 years, subject to any extension that may be granted by the Minister (with such an extension unlimited in time by the Planning Bill).

Additionally, the principles for infrastructure contributions have been removed from Part 7 as it is proposed that such principles be incorporated within other provisions and a NSW Planning Policy.

Deferral of contribution payments

As foreshadowed in the White Paper Reforms, the Planning Bill contemplates the deferral of contribution payments to closer to the point of sale and allows for councils to secure those contributions by the creation of a statutory charge on land. However there is no detail on the mechanics of such arrangements, which will be provided for under the Regulations.

Planning Agreements

The role, if any, of voluntary planning agreements has been the subject of differing positions by government during the various stages of the planning reform process. The Planning Bill continues to provide for the ability of a developer to enter into a planning agreement with one or more public authorities, despite suggestions in the White Paper that planning agreements would be phased out or significantly modified.

The most notable departure of the planning agreement provisions within the Planning from the current position is that the Planning Bill provides that any contribution under a planning agreement must be applied specifically towards:

• the provision of infrastructure that is identified in a local infrastructure plan or growth infrastructure plan;
• the provision of infrastructure, or any other public purpose, that is identified in a Ministerial planning order made under this section;
• the provision of affordable housing that is identified in a strategic plan;
• the conservation or enhancement of the natural environment of the State.

The effect of these provisions will be to limit the flexibility that developers and public authorities presently have when negotiating the contents of a planning agreement. The Planning Bill also now provides that the procedures to be followed in negotiating a planning agreement may include consideration of the value of the contribution which is offered compared to the value of the contribution that would be required but for the agreement, and for the payment of money into a statutory fund.

Building regulation and certification

Whilst the building regulation and certification requirements of the Planning Bill are largely the same as in the White Paper Reforms, some changes have been introduced by the Planning Bill including:

• the introduction of "completion of work compliance certificates" as an alternative to occupation certificates in certain circumstances ;
• the ability of the NSW Planning Director-General to provide guidance to building certifiers or subdivision certifiers on the exercise of their functions, including the preparation of a building manual;
• clarifications to the appointment of building certifiers and subdivision certifiers; and
• broadening the circumstances in which a certifier can make a direction regarding non-compliance in respect of an aspect of an approved development.

Transitional arrangements

The Planning Bill sets out details of savings and transitional provisions which provide for how existing strategic plans, approved developments or proposed development under assessment will be dealt with under the new planning system. Whilst further detail will be set out in the Regulations, much more detail is now known about transitional provisions than was previously the case. Specifically:

• existing strategic plans are to be recognised and incorporated into the new planning system, for example the provisions of State Environmental Planning Policies are taken to be planning control provisions of the local plans (except for the provisions which deal with exempt and complying development which are taken to be development code provisions of the Local Plan);
• Existing Local Environmental Plans are deemed to be planning control provisions of the relevant Local Plan;
• All heritage items, heritage conservation areas and archaeological sites in local environment plans will be part of the relevant Local Plan;
• development applications already lodged under the current system will continue to be assessed under the existing Environmental Planning and Assessment Act 1979;
• existing approvals for development under the current legislation will become consents issued under the new legislation and determinations under Part 5 of the Environmental Planning and Assessment Act 1979 will be taken to have been made under the new legislation;
• Planning agreements will be taken to be planning agreements under the new legislation; and
• reviews or appeals pending on the commencement of the new legislation must be determined in accordance with the provisions of the existing Environmental Planning and Assessment Act 1979.

Next steps

The Planning Bill is now being considered by the NSW Parliament.

Footnotes

¹White Paper, p95.

²White Paper p.114

The content of this article is intended to provide a general guide to the subject matter. Specialist advice should be sought about your specific circumstances.