Posted on May 9, 2013 by Frances Tse

Proposed Changes to Planning Agreements in Exposure Draft Planning Bill

The Exposure Draft Planning Bill 2013 (Planning Bill), which was released for public consultation along with the document published by the NSW Government on 16 April 2013 titled A New Planning System for NSW – White Paper, proposes several significant changes to the current provisions contained in the Environmental Planning and Assessment Act 1979 (EPA Act) relating to voluntary planning agreements (VPAs). These changes are outlined below.

Definition of VPA

The EPA Act  currently defines a VPA as an agreement or other arrangement under which the developer is required to dedicate land free of cost, pay a monetary contribution, or provide any other material public benefit, or any combination of them, to be used for or applied towards a public purpose. [My Emphasis]

The Planning Bill makes no reference to ‘other arrangements’,  ‘material public benefits’ or ‘public purposes’. Rather, it defines a VPA as an agreement under which the developer is required to dedicate land free of cost, pay a monetary contribution, or carry out public or other works, or any combination of them, in relation to:

• the provision of infrastructure that is identified in a local infrastructure plan or growth infrastructure plan or Ministerial planning order (if there is no local infrastructure plan or growth infrastructure plan applying to the land)
• the provision of affordable housing that is identified in a strategic plan
• the conservation or enhancement of the natural environment of the State.

Relationship to local infrastructure plans

The Planning Bill proposes that a council, when preparing a local infrastructure plan, will be able to identify not just local infrastructure for which the council may levy local infrastructure contributions under conditions of development consents granted by it, but also other infrastructure for the council’s area.

A VPA will be able to require contributions from a developer for this other infrastructure. This means that VPAs can cover a wider scope of infrastructure than development consent conditions.

Principles for infrastructure contribution

The Planning Bill proposes that a public authority, when entering into a VPA that relates to provision of infrastructure, must have regard to the following 5 principles for infrastructure contribution:

Principle 1. The local or regional infrastructure that is proposed to be funded by an infrastructure contribution should be able to be provided within a reasonable time.

Principle 2. The impact of the proposed infrastructure contribution on the affordability of housing should be considered.

Principle 3. The proposed infrastructure contribution should be based on a reasonable apportionment between existing demand and new demand for local or regional infrastructure to be created by the proposed development to which the contribution relates.

Principle 4. The proposed infrastructure contribution should be based on a reasonable estimate of the cost of proposed local or regional infrastructure.

Principle 5. The estimates of demand for each item of local or regional infrastructure to which the infrastructure contribution relates should be reasonable.

Money no longer expressly required to be applied ‘within a reasonable time’

The Planning Bill, unlike the EPA Act, contains no requirement that a public authority must apply money paid to it under a VPA towards the relevant purpose within a reasonable time.

Developer’s offer to enter into VPA

The Planning Bill retains the prohibition on the imposition of a condition of development consent requiring a developer to enter into a VPA except if the condition requires a VPA to be entered into in the terms of an offer made by the developer.

However, the Planning Bill, unlike the EPA Act, proposes that the developer’s offer must cover specified matters, being the mandatory matters that must be covered by a VPA as set out in the Bill.

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