Posted on December 9, 2021 by Anzer Khan and Carlo Zoppo

Changes to Compliance Cost Notices and Compliance Levies

On 27 October 2021, the Environmental Planning and Assessment Amendment (Compliance Cost Notices) Regulation 2021 (Amendment) commenced with the purpose of simplifying compliance cost notices (CCN’s).

The Amendment has been introduced as a result of council feedback that CCN’s were complex and did not sufficiently cover the costs and expenses typically associated with investigations.

Compliance Cost Notices

The Environmental Planning and Assessment Act 1979 (the Act) enables councils to issue CCN’s in order to assist councils and other issuing authorities to recover the reasonable costs incurred.

A compliance cost notice allows an enforcement authority, usually a council, to recover the reasonable cost and expenses associated with compliance activities, such as:

  • monitoring action under a development control order;
  • ensuring a development control order is complied with;
  • an investigation leading to the issue of a development control order; and
  • preparing or serving a notice of intention to issue an order.

The notices provide authorities with a compliance tool to ensure that those who are breaking the rules pay for the costs associated with investigations, instead of ratepayers.

Key Changes – CCNs

The primary changes to CCN’s, which are now in operation, are:

  • the previous maximum cap of $1,000 relating to the costs and expenses of an investigation has been removed (previously cl 281C(1) of the Environmental Planning and Assessment Regulation 2000 (Regulation);
  • the administrative burden involved in preparing CCNs has been simplified – councils are no longer required to include details of relevant tasks undertaken, the hours spent completing those tasks and relevant salary rates of persons who have undertaken those tasks, including out of pocket expenses (see cl 281B(1)(g) of the Regulation); and
  • councils can seek a maximum of $750 (increased from $500) to be paid in respect of administrative costs relating to a notice of intention to issue an order (see cl 281C(2) of the Regulation).

Builders and developers will still be able to challenge a CCN in the Land and Environment Court on the basis that the amount sought is unreasonable in the circumstances. This must be done within 28 days after the notice is served upon them (see s8.24 of the Act).

Compliance levies 

The previous restrictive provisions surrounding CCN’s, particularly those around costs, led to some councils recouping compliance costs through alternative mechanisms, including a compliance levy on development applications or through rates.

The Government has started to phase out the ability of council to impose compliance levies on development applications.

The key change is that for the 29 councils that do currently charge fees, there will be a transitional period that allows them to continue collecting the levies until 31 December 2021.

An amendment will be required to the Act to allow a new levy on complying development certificates to be charged.

A link to the Amendment can be found here.

A link to the Department’s website on compliance levies can be found here.

If you have any questions about this blog or the GIPA Act in general, please contact Carlo Zoppo on 8235 9705 or Anzer Khan on 8235 9717.