Australia: Changes to the Environmental Planning and Assessment Act 1979 (NSW) to be implemented soon

Last Updated: 5 February 2018
Article by Todd Neal, Katherine Edwards, Anthony Landro and Sejuti Kundu

IN BRIEF - THE LARGEST NUMBER OF CHANGES TO THE ENVIRONMENTAL PLANNING AND ASSESSMENT ACT 1979 (NSW) SINCE IT COMMENCED ALMOST 40 YEARS AGO ARE EXPECTED TO BE IMPLEMENTED IN THE FIRST HALF OF 2018

ENVIRONMENTAL PLANNING AND ASSESSMENT AMENDMENT BILL 2017

The Environmental Planning and Assessment Amendment Bill 2017 was assented to by NSW Parliament on 23 November 2017 approving the changes. The Bill is now awaiting proclamation.

Given the large scope of amendments to the Act, a staged approach will be used to introduce the changes to allow for a well-informed transition to the new measures and requirements for all stakeholders.

AMENDMENTS TO THE ENVIRONMENTAL PLANNING AND ASSESSMENT ACT 1979 (NSW)

The primary purpose of the amendments has been identified as "to promote the confidence in our state's planning system".

Four "underlying objectives" have been identified to achieve the primary purpose:

  • to enhance community participation
  • to promote strategic planning
  • to increase probity and accountability in decision-making
  • to promote simpler, faster processes for all participants

The table below sets out a concise summary of the amendments made to the Act.

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WHAT'S NEW? THE EFFECT OF THE AMENDMENT COMMENTS
Structural changes Structural changes to the Act include the introduction of 10 principal parts with decimal numbering of all provisions, relocation of certain provisions to schedules and the regulations, updated objects of the Act and updated language. The numerical amendments mean learning new section numbers. However, the amendments will enhance readability and clarity, which will help stakeholders understand the provisions, thereby ensuring an accessible Act.
Additional objects of the Act The additional objects of the Act that have been included in the amendments promote:

  • the sustainable management of built and cultural heritage (including Aboriginal cultural heritage)
  • good design and amenity of the built environment, and
  • the proper construction and maintenance of buildings, including the protection of the health and safety of their occupants.
The updated objectives highlight the importance of sustainable management, good design and amenity, and proper construction and maintenance. Agencies that administer the Act will need to give significant consideration to these key principles.

The new object "to promote good design in the built environment" dovetails with the release of the draft NSW Government's Architecture and Design Policy for New South Wales, which lays the foundation for "design-led planning".
Removal of objects of the Act Three objects of the Act have been removed.

  • the protection, provision and co-ordination of communication and utility services
  • the provision of land for public purposes
  • the provision and co-ordination of community services and facilities
The following redrafted objects will most likely result in minimal substantive changes.

  • to promote the social and economic welfare of the community and a better environment by the proper management, development and conservation of the State's natural and other resources
  • to facilitate ecologically sustainable development by integrating relevant economic, environmental and social considerations in decision-making about environmental planning and assessment.
Community participation plan The Act will require all planning authorities to prepare a community participation plan about how and when it will undertake community participation when exercising relevant planning functions (unless the council has a community strategic plan under section 402 of the Local Government Act 1993 (NSW) that includes all the matters required in a community management plan).

Community participation plans will need to meet mandatory requirements including:

  • public exhibition for a minimum periods plans, development applications and other matters,
  • public notification requirements of plans or applications, and
  • public notification of the determination or reasons for a determination.
For planning authorities, challenges will be twofold:

  • developing workable and meaningful community engagement that avoids "engagement fatigue", and
  • ensuring implementation of the plan given that the validity of a development consent can hinge on whether proper community participation has been provided.
For developers, community participation plans will be another plan to navigate in the development application process.

For the community, the aim of community participation plans is to increase confidence in decisions made.

Despite the benefits for the community, engagement processes will not be standardised across NSW, therefore participation requirements will vary from one local government area to another, creating more work for councils and developers.
Community participation principles Planning authorities will need to consider new community participation principles included in the Act when preparing a community participation plan. Principles include:
  • the community's right to be informed about planning matters that affect it,
  • planning information should be in plain English, easily accessible and in a form that facilitates community participation in planning, and
  • planning decisions should be made in an open and transparent way and the community should be provided with reasons for those decisions (including how community views have been taken into account).
The principles won't necessarily yield the same result for each council's community participation plan. Therefore, plans will vary from one local government area to another. However, the aim is to enhance effective community participation in the planning system, not consistent community participation.
Statement of reasons for decisions The Act will require written reasons to be given for decisions made by planning authorities. The preparation of statements of reasons will potentially add time to the process however stakeholders will know the formal basis of a decision. But, the requirement for written reasons will also potentially increase challenges by third parties to decisions, reducing the certainty of decision-making.
Local strategic planning statement The amendments to the Act will require each council to prepare and make a local strategic planning statement, which it must review at least every seven years. The statement must include or identify:
  • the basis for strategic planning in the area
  • planning priorities for the area
  • actions required for achieving those planning priorities, and
  • the basis on which the council is to monitor and report on the implementation of those actions.
The statement will need to align with the regional and district plans, and any applicable community strategic plan under local government legislation.

The Planning Secretary may issue requirements with respect to the preparation and making of local strategic planning statements.
Local strategic planning statements are proposed to complete the line of sight from regional and district plans.

This is in addition to Regional Plans and District Plans, which were introduced in the last year.

The Planning Secretary's power to issue requirements is intended to ensure councils planning fits within the broader geography of the area.
Review of Local Environmental Plans (LEPs) and State Environmental Planning Policies (SEPPs) every five years The Act will require councils to review their LEPs and the Planning Secretary to review relevant SEPPs at least every five years to determine whether they should be updated. Changes in population, infrastructure and strategic plans will need to be considered in the reviews to ensure development controls in LEPs and SEPPs are up-to-date.

While councils and the Planning Secretary will possess the discretion to decide if an LEP or SEPP should be updated after a review, the review process will alert strategic planners to changes that might be required.

This reform is necessary as recent years have shown that the suitability of land zones are rapidly changing. The challenge will be to incentivise councils to procure the rezoning of the sites expeditiously, as inertia and cost can often impact these processes even if there are proper planning grounds for rezoning.
Standardised Development Control Plans (DCPs) The amendments to the Act specify that regulations can allow for the creation of a standard, online format for DCPs, and authorise the Minister to publish requirements as to their form, structure and subject-matter. Whilst the requirement for councils to prepare standardised DCPs is not mandatory, there are a number of benefits they could bring including:

  • understanding of how DCPs work in one area, without having to relearn things when looking at DCPs in another area
  • professionals in the industry will have a uniform format across DCPs saving time and cost, and
  • easier uploading onto electronic platforms
The content will remain at the discretion of councils, but access to model provisions prepared by the Department of Planning and Environment will greatly enhance uniformity.
Powers to accept written undertakings The Act will empower the Secretary to accept a written undertaking by a person in relation to planning matters.

If a term of the undertaking is breached, the Planning Secretary can apply to the Court for an order:

  • directing compliance with that term of the undertaking
  • directing payment to the State of an amount not exceeding the amount of any financial benefit that the person has obtained directly or indirectly and that is reasonably attributable to the breach
  • any order that the Court thinks appropriate directing the person to compensate any person who has suffered loss or damage as a result of the breach
  • to prevent, control, abate, mitigate or make good any actual or likely damage to the built or natural environment caused by the breach, and
  • any other order the Court considers appropriate
It is unknown how these new powers will be used in practice and whether consent authorities will apply pressure to obtain these undertakings in return for the grant of development consents as we see in the case of voluntary planning agreements.

However, we expect these should discourage calculated breaches of the Act. Of course, breaches will only be discouraged where enforcement action is taken against failures to comply with the terms of a written undertaking.

The use of such undertakings is common under the Environment Protection and Biodiversity Conservation Act 1999 (Cth), and it is possible a shift towards this mechanism will occur.
Directions regarding method of determining the extent of the public benefit made by a developer The Act will empower the Minister to make determinations or give directions about the method of determining the extent of public benefit provided by a developer under a planning agreement. At the time it was proposed in early 2017, it coincided with the proposed Ministerial direction and revised voluntary planning agreement practice note.

However, the draft Ministerial direction and the revised voluntary planning agreement (VPA) practice note have not been adopted.

The introduction of a written methodology for determining the public benefit, should provide greater fairness and reasonableness to the VPA process.

While this opportunity to prescribe the methodology for determining the public benefit will exist when the changes are made, landowners and developers will only see the benefits if the Minister exercises these powers under the Act.
Reimbursement of council's cost to investigate and enforce compliance Councils will have the power to impose a levy on applicants making development applications for the purposes of reimbursing a council's costs incurred in investigating and enforcing compliance with the requirements of the Act relating to development requiring consent. This change involves the potential imposition of an additional cost on applicants for development consents. Essentially, it is a means to push the cost of ensuring compliance with conditions of development consent back onto landowners/developers.

It should be understood that the levy will only be implemented if the regulations are amended to make provision for it and if a particular council adopts the levy. Therefore, the status quo may remain for some time.
Powers to suspend work under a complying development certificate Councils will have new investigative powers to suspend work under a complying development certificate for up to seven days to investigate. Whether the work complies with applicable development standards. Complying development is generally fast paced and council staff have difficulty in exercising their compliance and enforcement powers to ensure improper or flawed complying development is not built. While complying development is meant to be low impact, this new provision will help to ensure that it remains that way when it is being constructed.
Validity of complying development certificates The Court may by order declare that a complying development certificate is invalid if:
  • proceedings for the order are brought within three months after the issue of the certificate, and
  • the certificate authorises the carrying out of development for which the Court determines that a complying development certificate is not authorised to be issued
This overcomes the Court of Appeal decision (Trives v Hornsby Shire Council [2015] NSWCA 158) that held the characterisation of complying development could only be made by the certifier, and that a Court could not look into this matter as a question of "jurisdictional fact" - making it difficult to invalidate.

As a result of the changes, the Court will be able to objectively determine whether the complying development certificate is in accordance with the relevant standards.
Validity of other certificates The Court may by order declare that a construction, subdivision works, subdivision, or compliance certificate is invalid if:

  • proceedings for the order are brought within three months after the issue of the certificate, and
  • the plans, specifications or standards of work specified in the certificate are not consistent with the development consent for the building work or subdivision work
The ability to seek an order in relation to the validity of an occupation certificate is excluded from the new provision.

Appeals in relation to occupation certificates will continue to be limited to being made by the applicant for the certificate, rather than for example, an objector.
Limitations on certifiers The regulations may be amended to limit the type of complying development that can be certified by an accredited certifier. This will allow the government to play with the levers of housing supply. No doubt if or when supply catches up, the more intense types of complying development will be "turned off".
Deferred commencement complying development certificates The Act will allow for the "deferred commencement" of complying development certificates in certain circumstances. The use of deferred commencement conditions in complying development certificates will enable the earlier activation of the consent once the lots are created.

While this pragmatism is to be commended, the ability for the certifier to impose deferred commencement conditions appears at large.
Special infrastructure contributions Special infrastructure contributions will be able to be required as a condition to the grant of development consent for developments within a special contributions area. This cost is currently incurred by the developer and has the potential to increase development costs. We can expect to see more Ministerial directions imposing special infrastructure contributions to raise funds for the infrastructure required in high growth priority precincts.
Local planning panels Amendments to the Act include:

  • the requirement for a council to constitute a single local planning panel if it is in an area prescribed by the regulations, and
  • making it clear that a person is not ineligible to be a member of a local planning panel merely because the person carries on the business of a planning consultant.
This is already a requirement for councils within the Greater Sydney Region and the City of Wollongong. As such, we may see the regulations updated to include areas outside of Sydney and Wollongong to establish a single local planning panel.
Independent Planning Commission The amendments to the Act change the name of the Planning & Assessment Commission (PAC) to the Independent Planning Commission (IPC).

Additionally, the power of the PAC to review any development, activity, infrastructure or project, if requested to do so by the Minister, has been removed.
The Independent Planning Commission is responsible for making decisions about the most complex developments in the state.

The removal of the review function aims to reduce the processing time for State Significant Development (SSD) applications.
Section 96 modification applications to regularise works There are two changes to the Act in relation to section 96 modification applications.

  • Consent authorities must take into consideration the reasons given by the consent authority for the grant of the consent that is sought to be modified.
  • Consent authorities will be able to charge a levy to applicants making development applications such as modification applications that will be set out in the regulations.
The current system permits applicants to apply to modify a consent to regularise work already constructed in breach of the development consent. Despite the Bill initially proposing to change this, the changes will not reverse this ability.

However, changes to this process exist.
  • The consent authority needs to consider the reasons for the grant of the original consent.
  • Imposing a levy on applicants to deter unauthorised works.
Regional Planning Panels Additional provisions in the Act specify that property developers and real estate agents are not eligible to be a member of a Sydney district or regional planning panel. This amendment to the Act builds on the recent reforms by strengthening the rules for Sydney and joint regional planning panels to be in line with the local planning panel provisions.
Enhanced powers of the Planning Secretary The Planning Secretary will be provided "step in" rights to act on behalf of an approval body for the purposes of informing a consent authority whether the approval body will grant approval or of the general terms of its approval. This power will only arise where the Planning Secretary is authorised by the regulations or where there is an inconsistency between two or more general terms of approval. This change will only apply to designated development where councils are the consent authority.

Some of the most significant blockages occur for larger state significant infrastructure and development projects.
Transitional arrangements for Part 3A projects The government is making progress towards closing off the transitional arrangements for former Part 3A projects. The changes to the Act include repealing the transitional provisions in Schedule 6A of the Act and transferring them to the Environmental Planning and Assessment (Savings, Transitional and Other Provisions) Regulation 2017 (NSW).

Approvals under Part 3A can be surrendered for a new development consent without the requirement for the development to be reassessed. However, the consent authority may modify the manner in which the continued development is to be carried out for the purpose of consolidating the development consents applying to the land.
This change does not remove the transitional provisions for Part 3A approvals as the provisions will be contained with a regulation. The Minister's second reading speech indicated the government "is absolutely committed to the repeal of the transitional arrangements for Part 3A". As such, further amendments may be announced by the Minister at a later date.

Now is the time to lodge section 75W modification applications to avoid the "substantially the same development" test that will arise once Part 3A ends.
Transferrable conditions The changes will allow for development consents to be granted subject to specified conditions that cease to have effect on the issue of an authorisation under another act relating to that development. This will remove overregulation and duplication which can add to confusion and complexity. This is likely to arise where a development consent imposes conditions relating to that development as well as an Environment Protection Licence, or for mining where a mining lease comes into place. It will mean the relevant regulatory authority responsible for enforcement may change hands during the life of development in respect of aspects of the development and its operation.
Financial assurance Part 9.4 of the Protection of the Environment Operations Act 1997 (NSW) that relates to the provision of financial assurances to secure or guarantee funding for or towards the carrying out of works or programs under an Environment Protection Licence, are to be carried over to development consents. This means consent authorities will have the power to impose a condition in a development consent requiring an applicant to provide a financial assurance (eg a bank guarantee or a bond) to secure or guarantee funding for or towards the carrying out of works or programs required by or under the development consent.

This is but another tool for consent authorities to ensure compliance with development consents.

How the financial assurance is to be calculated is yet to be announced. A policy direction has not been publicly released by the NSW Environment Protection Authority who is responsible for imposing financial assurances on holders of Environment Protection Licences.

DEVELOPERS WILL BE IMPACTED BY CHANGES TO THE ENVIRONMENTAL PLANNING AND ASSESSMENT ACT 1979 (NSW)

These amendments will see the largest number of changes to the Act implemented since the Bill was passed in 1979.

Overall, the changes expand the powers of consent authorities and impose additional obligations on them for community participation and strategic planning. The expansion is likely to impact developers by increasing the cost of development and compliance, as the provisions within the Act are tightened.

Todd Neal Katherine Edwards Anthony Landro Sejuti Kundu
Planning and development
Colin Biggers & Paisley

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.

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Authors
Todd Neal
Katherine Edwards
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