Development Contributions Planning Agreements

1. Development Contributions Planning Agreements Environmental Planning and Assessment Act 1979 Part 4, Division 6, Subdivision 2 lindsaytaylorlawyers Level 7, 1 O’Connell Street, Sydney NSW 2000, Australia T 02 8235 9700 F 02 8235 9799 W www.lindsaytaylorlawyers.com.au E mail@lindsaytaylorlawyers.com.au ABN 15 695 894 345

2. Development ContributionsPlanning Agreements Overview of legislation • S93F of the EPA Act provides that a planning agreement (PA) is a voluntary agreement between a planning authority and a developer that provides for the making of a contribution by the developer towards a public purpose in connection with development • Contributions can be in the form of monetary contributions, land dedication, public works, other material public benefits • A PA can be entered into in connection with a rezoning application or development application • All public authorities (including councils) are declared to be planning authorities by the EPA Regulation 2000 3 November 2014

3. Development ContributionsPlanning Agreements Overview of legislation • A PA can exclude the application of s94 and s94A of the EPA Act to development • If s94 is not excluded, the PA must set out whether benefits under the PA are to be taken into account in determining s94 contributions in relation to development • A PA must be considered under s79C of the EPA Act in relation to a development application but only to the extent relevant • A development consent can be granted subject to a condition that a PA is entered into but only in terms of the offer made by a developer 3 November 2014

4. Development ContributionsPlanning Agreements Overview of legislation • No requirement for nexus between the development to which a PA relates and the public purpose towards which a contribution under a PA is made • The planning merits of a PA cannot be subject of an appeal to the Land & Environment Court, nor can a planning authority’s refusal to enter into an agreement • However, the legality of a PA can determined by the Court • A breach of a PA can be enforced as if it were a breach of the EP&A Act • A PA may be registered on land title if all parties with interests in the land agree 3 November 2014

5. Development ContributionsPlanning Agreements Overview of legislation • A PA cannot require a rezoning or development consent to occur or authorise a breach of the EP&A Act • An environmental planning instrument cannot expressly require a PA to be entered into before consent is granted • A consent authority cannot refuse to grant development consent to development consent solely because a PA is not entered into 3 November 2014

6. Development ContributionsPlanning Agreements Overview of legislation • A PA must be in writing and signed by the parties • A PA is not entered into until it is signed by all parties • Public notice is required to be given before a PA is entered into, amended or revoked • A PA must be publicly notified, if practicable, as part of and contemporaneously with, and in the same manner as the rezoning application to which it relates, otherwise as soon as possible afterwards • A PA must be publicly notified as part of and contemporaneously with, and in the same manner as the DA application to which it relates 3 November 2014

7. Development ContributionsPlanning Agreements Overview of legislation • A PA can be amended or revoked by a subsequent agreement in writing signed by the parties • The Minister may give directions about PA procedures or standard requirements • The D-G may issue practice notes relating to the preparation of PAs • Information about PAs must be given to the Minister and a council if they are not party to the agreement 3 November 2014

8. Development ContributionsPlanning Agreements Development contributions under planning agreements • Public purposes towards which contributions may be made include (but are not limited to): • Providing (or recouping the cost of providing) public facilities • Providing (or recouping the cost of providing) affordable housing • Providing (or recouping the cost of providing) transport or other infrastructure relating to land 3 November 2014

9. Development ContributionsPlanning Agreements Development contributions under planning agreements • Public purposes towards which contributions may be made include (but are not limited to): • the funding of recurrent expenditure • the monitoring of planning impacts of development • the conservation or enhancement of the natural environment 3 November 2014

10. Development ContributionsPlanning Agreements Mandatory contents of planning agreements • Parties to the planning agreement • Description of land • Description of proposed rezoning or development • Details of contributions to be made 3 November 2014

11. Development ContributionsPlanning Agreements Mandatory contents of planning agreements • Whether the agreement excludes the application of s94 or s94A to development • If s94 is not excluded, whether the benefits under the PA are to be taken into consideration in calculating s94 contributions • Dispute resolution mechanism • Enforcement mechanism, such as bond or bank guarantee 3 November 2014

12. Development ContributionsPlanning Agreements Typical process for entering into a PA with a DA • Step 1 – pre-application negotiations with consent authority and any other parties re DA and PA • Step 2 – agreement on terms of draft PA, documentation of PA and explanatory note (EN) • Step 3 – DA lodged with consent authority together with developer’s offer to enter into PA if consent is granted • Step 4 – consent authority consults public authorities about the DA and draft PA 3 November 2014

13. Development ContributionsPlanning Agreements Typical process for entering into a PA with a DA • Step 5 – DA, draft PA and EN are publicly exhibited, submissions considered • Step 6 - DA and PA are considered and determined by the consent authority; if consent is granted, a condition is imposed requiring the PA to be entered into • Step 7 – PA is entered into 3 November 2014

14. Development ContributionsPlanning Agreements Some advantages of planning agreements • Particularly suited to large development projects in single ownership, and development requiring a rezoning • Enables all parties to negotiate specific planning outcomes • Gives stakeholders the ability to re-distribute the costs and benefits of development • Provides a mechanism to address planning issues that may prevent projects proceeding • Allows for the creation of a flexible pool of contributions 3 November 2014

15. Development ContributionsPlanning Agreements Potential uses of planning agreements • Providing compensation for loss of public facilities or damage to public works caused by development • Addressing the potential impacts of development that might prevent development consent being granted • Providing for new or enhanced public facilities to meet development • Prescribing inclusions in development, such as affordable housing 3 November 2014

16. Development ContributionsPlanning Agreements Potential uses of planning agreements • Securing the recurrent funding of public facilities • Co-ordinating and managing contributions from major development • Manage specific environmental outcomes 3 November 2014

17. Development ContributionsPlanning Agreements Actual uses of planning agreements to date • Providing up-front seed-funding for new infrastructure, such as water supply and sewerage works, drainage works, roads, etc in order to allow development to proceed, • Providing restitution, from s94 contributions or s94A levies, fordevelopers who seed-funded new infrastructure • Providing for the protection and management of environmentally sensitive land and flora and fauna habitats, e.g., through dedication of land as a national park, nature reserve, etc., biodiversity bank or environmental trust fund arrangements 3 November 2014

18. Development ContributionsPlanning Agreements Actual uses of planning agreements to date • Providing for the construction and hand-over of public works by developers • Providing for the public use of private facilities (e.g., car parking, community facilities) • Providing for the private maintenance of public land (e.g., open space, roads) • Providing for the relocation and enhancement of public facilities in connection with development 3 November 2014

19. Development ContributionsPlanning Agreements Actual uses of planning agreements to date • Providing a public benefit through the limitation or surrender of development opportunities over land • Providing for the early commencement of development which involves the provision of a public benefit • Providing affordable housing contributions as a percentage levy based on development cost • Providing for royalty payments to fund the maintenance of haulage roads 3 November 2014

20. Development ContributionsPlanning Agreements Actual uses of planning agreements to date • Providing for the valuation of non-monetary public benefits in order to provide for credits and offsets against 94 contributions 3 November 2014

21. Questions? lindsaytaylorlawyers Level 7, 1 O’Connell Street, Sydney NSW 2000, Australia T 02 8235 9700 F 02 8235 9799 W www.lindsaytaylorlawyers.com.au E mail@lindsaytaylorlawyers.com.au ABN 15 695 894 345