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Resource Management Update – June 2016

Home Insights Resource Management Update – June 2016

In this edition:

New National Policy Statement on Urban Development

Housing has been the key RMA issue in recent months, with housing supply and housing affordability both in the spotlight – particularly in Auckland, where house prices continue to head north. Central Government, Local Government and financial institutions have each been putting forward views on potential causes and what may be required to address the issues.

From the Government’s perspective, one of the most significant steps has been the release of a consultation document on the draft National Policy Statement (NPS) on Urban Development Capacity which introduces specific economic tests and requires councils to ensure that sufficient land is available to meet demand – 20 per cent more than forecasted demand in the short to medium term, and 15 per cent more than forecasted demand in the long term. 

Once implemented, councils will be required to comply with the NPS in their district and regional plans and regional policy statements. The specific economic tests and thresholds are unique in the RMA context, although may largely reflect a quantification of the processes that councils already undertake.  

Prime Minister John Key has suggested the draft NPS will make a “tremendous difference” to Auckland’s housing supply. However, many commentators caution that it does not require councils such as Auckland Council to do much more than it is already doing, and that the provision of infrastructure is a more significant impediment than land supply.

Submissions on the NPS are due on 15 July 2016. Minister for the Environment Nick Smith has determined that he will consider submissions and decide whether the NPS should be approved or not without a hearing, meaning that submissions are the only method available to influence the final outcome. The Government has indicated that it seeks to have the draft NPS implemented by September this year.

A copy of the draft can be found here.

Daniel Minhinnick

Sitting, waiting, wishing – recommendations, decisions and appeals on the Auckland Unitary Plan

The last hearing into submissions on the Auckland Unitary Plan was held on 13 May 2016 marking a significant milestone for those who participated. Some parties have been involved since before the release of the draft Unitary Plan in March 2013.

The Independent Hearings Panel now holds the pen on the Unitary Plan and is tasked with considering the multitude of submissions, evidence and presentations it received. They must release its recommendations to Auckland Council by 22 July 2016  (the recommendations will be publicly released on 27 July 2016) and recommendations are expected to include a ‘clean’ copy of the amended Unitary Plan provisions, along with individual topic reports explaining the Panel’s recommended amendments.

Recommendations have already been released on Topic 074 – Designations, which can be found here. The process for designations differs from the rest of the Plan as requiring authorities have a role in decision making, as well as the Panel and Council and not all designations were included in Topic 074. Recommendations on those outstanding designations will be released with the recommendations on the rest of the Plan in July 2016 andtimeframes for designations and the rest of the Plan are detailed further below.

Once Auckland Council receives the recommendations, it has just 20 working days to consider and publicly notify its decision, due 19 August 2016 and is holding a number of workshop/drop-in sessions in early August to help the Councillors understand the Unitary Plan and the Panel’s recommendations. Decisions will be made at public at Council meetings on 16, 17 and 18 August 2016.

The Council is able to accept or reject recommendations, but if it rejects a recommendation, it must propose an alternative solution within the scope of submissions on the Plan. Given the compressed timeframe, it is expected that Council officers will direct the Councillors to focus on bigger issues, rather than the finer provisions. These ‘big ticket items’ are likely to include whether or not there is a Rural Urban Boundary (and whether it is a Regional Policy Statement or district plan-level tool), the level of intensification in residential areas and town centres, viewshafts, historic heritage and special character (including the pre-1944 overlay) and the approach to zoning generally. 

There are only limited rights of appeal of the Council’s decision. An appeal may be lodged in the Environment Court by a person who made a submission if:

  • the Council rejects the Panel’s recommendation and proposes an alternative solution; or
  • the Council accepts a recommendation from the Panel that is identified as being out of scope and the person is unduly prejudiced by the amendment.

There is also a right to appeal to the High Court on a question of law where the Council accepts the Panel’s recommendations.

Appeals on the Plan (excluding designations) must be filed within 20 working days of notification of the decision, so appeals will be due on 16 September 2016.

In light of the tight timeframes between the recommendation and Council decision, and Council decision and appeal deadline, submitters will need to quickly synthesise the amended Plan and determine how their interests have been affected. Some parties are likely to lobby Council seeking that recommendations be rejected; however, parties should be conscious that any changes by Council, open up the possibility for appeal.

It will be relatively straightforward to determine if an appeal to the Environment Court is available, given that rejected recommendations and out of scope recommendations will be clearly identified. Appeals on points of law will require greater consideration and, given the short period between the Council decision and appeal due date, parties will need to be proactive if such appeals are to be pursued.

Set out below is an overview of the next steps in the process, prepared on the assumption that the Panel, Council and Requiring Authorities will take the maximum time afforded to them under legislation, without seeking to extend their deadlines.

 

Due date

Step
Unitary Plan
Topic 074 – Designations
Other Designations

Recommendations

22 July 2016 (available 27 July 2016)

18 May 2016

22 July 2016 (available 27 July 2016)

Council Decision

19 August 2016

16 June 2016

19 August 2016

Requiring Authority Decision

28 July 2016

30 September 2016

Requiring Authority Decision Notified

18 August 2016

21 October 2016

Appeals

16 September 2016

15 September 2016

21 November 2016

Michael Doesburg

Select Committee extends deadlines for RMA reforms

The Local Government and Environment Select Committee report back date on the Resource Legislation Amendment Bill (Bill) has been delayed until 6 September 2016, and was originally scheduled for early June. The Select Committee requires more time to consider the substantial changes proposed to the national direction, planning and resource consent processes of the RMA and the over 750 submissions received on the Bill.

For further detail on the proposed changes read our December update following the introduction of the Bill into Parliament at the end of 2015. 

Common issues submitters have brought to the attention of the Select Committee at the Hearings (which took place in Auckland, Wellington and Christchurch over May) include:

  • The wide-ranging ministerial powers in relation to national planning instruments (including the proposed national planning template), streamlined and collaborative plan-making processes, and regulation making powers. Many submitters identified that these new powers will create significant constraints on a local authority’s ability to determine the appropriate planning framework for their region or district. 
  • The extensive and complex changes to the notification provisions of the RMA leading to a reduction in public participation. Many submitters were concerned that the proposed changes are unnecessary due to the effective 2009 amendments relating to trade competition.
  • The need to effectively manage reverse sensitivity effects (which was not proposed in the Bill but is an important consideration when taking into account the housing focus of the reform and the reduced opportunities for notification proposed).
  • Wide opposition to the loss of merit appeals to the Environment Court, with submitters raising access to justice concerns and the need to provide an effective check on the decisions of local authorities.
  • The lack of detail provided in the Bill surrounding the creation of a streamlined plan-making process and the ability for the public to be involved in such a process.
  • Whether many of the new processes proposed in the Bill, such as the national planning template, can already be effectively achieved through current mechanisms in the RMA including national policy statements and national environmental standards. The new draft National Policy Statement on Urban Development Capacity, discussed earlier in this update, being an example of such a mechanism. 

Some submitters also suggested putting the Bill on hold until the Productivity Commission released its report on better urban planning, which is now scheduled for a November release. A potential recommendation in the report could be for separate legislation, one covering natural resources, and the other urban planning. 

In our view, given the extent of opposition to the Bill, it is likely that the Select Committee’s version released in September will be notably different to the one introduced to Parliament last year. We will keep you updated on any further news from the Select Committee.

David Alley

Water Fight – recent developments regarding charging for use of freshwater

The amount of groundwater currently allocated in the Ashburton area is assessed by the Regional Council as exceeding the limit of sustainable allocation, leading to concern that the sale of the lot and establishment of a water-bottling plant, would have ramifications on others in the area already extracting groundwater for domestic and agricultural purposes.

This controversy resulted in a call from many interests for reforms introducing greater regulation of the granting rights to take water including a moratorium on further bottling of water, a prohibition on export of bottled water, and a tax or fee on large-scale water takes.

Discussions around the appropriateness of charging regimes for water-use have been ongoing for many years. Currently no charge can be levied for the taking of water from water-bodies such as aquifers. Minister for the Environment Nick Smith has made clear that a charging regime is not considered appropriate by the Government for a number of reasons. The Minister’s concerns relate primarily to issues around the fairness of charging some users for extracting water but not others, and the impact on both consumers and the export industry of increasing production costs in water-intensive industries such as horticulture and dairying.

The latest consultation document on the National Policy Statement for Freshwater Management (NPSFM) was released in February this year and sets out the next steps the Government proposes in order to improve the management of fresh water in New Zealand It introduces a modest proposal to increase the ability of local authorities to recover the costs of monitoring, enforcement, research and management from water users and aims to give local authorities more flexibility around how they will meet the increasing costs of improving freshwater management, without having to spend additional general ratepayer funding.

Consultation on the proposed reform of the NPSFM closed on 22 April 2016 and submissions are currently being analysed. While it is clear that the current Government has no interest in going beyond the modest reforms proposed for the NPSFM by enabling charging for commercial uses of water above cost-recovery, a change in Government could well lead to a change in position on this matter. 

The NPSFM consultation document can be found here.

Rachel Robilliard

Lodgment not the last chance saloon for alternatives assessments

North Eastern Investments Limited v Auckland Transport [2016] NZEnvC 073

The latest case law regarding the assessment of alternatives for notices of requirement (NoR) highlights the importance of witnesses having a full understanding of the assessments undertaken by the requiring authority and  that the Court is open to acknowledging that the RMA process, and the alternatives assessment, is “an iterative one”.

North Eastern Investments Limited (NEIL) has faced a long and arduous battle since 2003 seeking consents to develop approximately 7.8 hectares of land between Fairview Avenue and Oteha Valley Road in Albany for intensive residential and mixed-use developments. Over the last decade a number of issues have arisen, leading to several hearings in the Environment Court, including this case and most recent proceedings have involved an application by Auckland Transport for a NoR to construct roading through NEIL’s site to develop the Fairview Catchment in Albany. NEIL appealed against Auckland Transport’s decision to confirm the NoR, arguing that the designation would have a major disenabling effect on the use of its land.

One of the primary issues in contention was the adequacy of the assessment of alternatives under section 171(1)(b) RMA. NEIL submitted that the assessment of alternatives was inadequate and involved a pre-determination of the preferred option. 

While the Court accepted that there were some shortcomings in Auckland Transport’s assessment of alternatives, the Court confirmed that an inadequate assessment of alternatives did not necessarily mean that an application for a NoR would not be confirmed. Rather, the Court allowed for these shortcomings to be remedied over time through the expansion of the assessment of alternatives following the notice of appeal.

It was acknowledged that the process under the RMA can be “an iterative one” and in the three years since the decision on the NoR was made by Auckland Transport, considerable additional modelling and information had become available. This information was used to evaluate many of the issues not addressed by Auckland Transport at the time of notification of the NoR and contributed to forming an overall adequate assessment of alternatives.

Counsel for NEIL extensively cross-examined Auckland Transport witnesses in respect of the project objectives, as well as identification and evaluation of alternatives and their effects both prior, and subsequent to, the issue of the NoR. It was through the cross-examination of witnesses that the Court became aware of the inadequacy of Auckland Transport’s alternatives assessment. It is therefore important to remember that witnesses have a full understanding of:

  • the overall breadth of work that has been undertaken on the assessment of alternatives, and the timing of that work;
  • the initial project objectives and scope of the assessment; and
  • how alternatives were selected, what factors were used to evaluate them, how these were weighted, and what assumptions were made.

While it is desirable that the assessment of alternatives is sufficiently comprehensive to be deemed adequate at the outset, the Court’s decision indicates that any deficiencies in an initial analysis can be cured during “extensive work undertaken before [a] hearing and as a result of the material placed before the Court and the lengthy cross-examination and questioning”.

Jess Riddell and George Willis

Framework consent provisions in the proposed Auckland Unitary Plan are legal

Re Auckland Council [2016] NZEnvC65

On 15 April 2016, the full Environment Court released its final decision on an application by Auckland Council for declarations regarding the lawfulness of framework plan provisions in the proposed Auckland Unitary Plan.

The Court is now satisfied that a rule enabling applications for a bundle of land use activities, which would authorise the key enabling works necessary for the integrated development of land, was in the legal power of (‘intra vires’) the Resource Management Act 1991 (RMA).

As long as the consent expressly allowed the consent holder to use land in a manner which would contravene a district rule (section 9(3) of the RMA), the rule would be intra vires the RMA, even though other resource consents would be required to authorise further development.

In respect of the incentives for obtaining framework consents, the Court found that a rule that provided for building height increases was beyond the powers (‘ultra vires’) section 76(3) of the RMA. Similarly an incentive which leads to a less restrictive activity status applying to subsequent development was also held to be ultra vires. The Court found that the only appropriate incentive was an amended notification process, where if a framework consent is held, subsequent applications would not be publicly notified (but may be limited notified).

The Court therefore held that the amended framework consent process was lawful and that the Proposed Auckland Unitary Plan may allow incentives for obtaining framework consents through an amended notification process. 

Even though the Court has held that there is no legal bar, the Independent Hearings Panel must still decide whether the framework consent process is the most appropriate way to achieve the objectives of each relevant precinct.

Assuming the framework consent process makes in into the final plan, it will be interesting to see how many developers make use of the framework consent process in light of the reduced incentive to do so. An amended notification process may not be enough of an incentive to encourage applicants to undertake a two-step consenting process.

Michael Doesburg and Esther Austin

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