Australia: Understanding the new infrastructure provisions of the Sustainable Planning Act 2009

HG Infrastructure Charges Reform Series: 8 July 2014
Last Updated: 26 July 2014
Article by David Nicholls, Sarah Macoun and Thomas Buckley

In this Alert as part of HopgoodGanim's Infrastructure Charges Reform Series, Partners David Nicholls and Sarah Macoun, and Associate Thomas Buckley analyse the key amendments to the infrastructure charging and planning provisions of the Sustainable Planning Act 2009 that were introduced by the Sustainable Planning (Infrastructure Charges) and Other Legislation Amendment Act 2014.

Key points

  • Important changes to the requirements for infrastructure offsets and refunds, including the ability to cross-credit across infrastructure networks.
  • Recognition of existing lawful use rights when calculating demand placed on infrastructure generated by development.
  • A new application process to convert non-trunk infrastructure to trunk infrastructure – a "conversion application".
  • New requirements and obligations on developers and local governments in respect of infrastructure charges notices (ICNs) and conditions about infrastructure.
  • Extension of the infrastructure charging provisions to permissible changes, extensions of approvals and compliance assessment.
  • New appeal rights to the Planning and Environment Court (P&E Court) and a Building and Development Committee (B&D Committee).

Offsets and refunds

It is now prescribed that when an offset is available for an item of infrastructure, the value of that infrastructure must be offset against the total charge which has been levied by the local government for the development (known as "cross-crediting").1 By way of an example, under this arrangement, an offset for transport infrastructure will be applied against the total charge that has been levied for all infrastructure networks for the development, which might also include stormwater and open space infrastructure networks.

Additionally, a local government's charging resolution (which lists the charges applicable to its area) must now include the method for working out the cost of the infrastructure the subject of an offset or refund.2 Accompanying this is a new process for working out the cost required for an offset or refund. Where an applicant does not agree with the value of the establishment cost of an offset or refund, it may apply to the local government to have that value calculated by reference to the method adopted under the local government's charging resolution.3 This is intended to cover circumstances where the 'actual' value of infrastructure is greater than the 'planned' value of infrastructure.

Infrastructure credits

Credits are applied to an infrastructure charge when a development application is made to alter or intensify an existing lawful use of land. In those circumstances, the charge will usually be discounted by the amount of the charge that would have applied to the existing use, so that the infrastructure charge for the development only applies to the changed component of the use. However, the circumstances in which this happened varied considerably between local governments.

It is now prescribed that an infrastructure charge may only be for 'additional demand' placed upon trunk infrastructure that will be generated from the development. Existing lawful uses of land (and development that can be lawfully carried out without a permit) cannot be included in assessing additional demand.4

Conversion applications

A new process is prescribed that allows an applicant to apply to a local government to have non-trunk infrastructure which is required to be provided under an approval to be converted to trunk infrastructure (a conversion application).5 A local government will have 30 business days to decide a conversion application (which may be subject to an information request). The local government's decision must have regard to decisional criteria prescribed in a statutory guideline.6

Conversion applications seek to overcome circumstances where developments have been conditioned to provide infrastructure (as 'non-trunk'), where in reality the infrastructure serves a trunk function for the area (by servicing other developments in the area). The benefit to be obtained from a conversion application is the entitlement to an offset for the provision of the infrastructure.

Infrastructure charges notices

ICNs will now attach to land.7 If land is sold, the obligation to pay infrastructure charges under an ICN (for the carrying out of an approval on the land) will become the obligation of purchaser.

Additionally, an ICN must now include the reasons for the decision to give the ICN, information about the applicant's appeal rights and details of applicable offsets or refunds (including the timing for the payment of a refund).8

Infrastructure conditioning powers

Local governments will now be able to impose conditions on approvals for the provision of trunk infrastructure even though it is not identified in a local government infrastructure planning instrument.9 This new conditioning power is intended to recognise that at the time of the making of those planning instruments, not all future trunk infrastructure scenarios can be foreseen or anticipated.

A local government is also now prohibited from imposing a condition on an approval requiring the applicant to enter into infrastructure agreement about infrastructure required for the development.10 There is also now an additional obligation on a local government to include in a decision notice, the statutory basis for each condition about infrastructure that is imposed on the approval.11

Permissible changes, extensions and compliance assessment

The infrastructure charging provisions now apply to requests for a permissible change to a development approval, requests to extend development approvals and compliance assessment.12 Accordingly, when a developer applies to 'change' its approval, or makes a request to extend the relevant period of its approval, or requests compliance assessment of the development, the local government can issue a new ICN for the changed approval, the extension to the relevant period or with a compliance permit. The effect of this is that new (sometimes greater or smaller) charges will be levied on the development.

Appeals in respect of infrastructure

The recipient of an ICN is entitled to appeal the decision to give the notice to the P&E Court or a B&D Committee. The grounds upon which that appeal can be made have been expanded.

The appeal may state be that there was an error relating to the application of the 'charge', an error relating to the working out of 'additional demand' (for existing lawful uses of land) or an error relating to an 'offset or refund' (including that there was no decision made about an offset or refund).13 An applicant will also be entitled to appeal against the timing stated in an ICN for the payment of a refund. A right to appeal to the Court, but not to a B&D Committee, in respect of manifest unreasonableness of an ICN remains in the legislation.

There is also now a right of appeal against the refusal or deemed refusal of a conversion application.14 The right of appeal is available only to the applicant. There are no third party appeal rights.

Similar to the process prescribed for development approvals, the recipient of an ICN is now entitled to make submissions to the local government about the ICN during its appeal period (including the ability to suspend the appeal period).15

In the next edition of the Infrastructure Charges Reform Series, we will provide an overview of the new changes to the South-East Queensland Water (Distribution and Retail Restructuring) Act 2009, focusing on the charging arrangements for distributor-retailers and the new 'water approval' requirements.

Footnotes

1Amended section 649

2New section 633

3New section 657

4New section 636

5New sections 658 – 662

6Statutory Guideline 03/14 – Local government infrastructure plans

7New section 635

8New section 637

9New section 647

10Amended section 347

11Amended section 335

12New section 626

13Amended sections 478 & 535

14New sections 478A & 535A

15New sections 641 – 644

© HopgoodGanim Lawyers

Award-winning law firm HopgoodGanim offers commercially-focused advice, coupled with reliable and responsive service, to clients throughout Australia and across international borders.

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