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Resource Management Update – March 2015

Home Insights Resource Management Update – March 2015

In this edition:

Minister announces substantial RMA reforms

In January, in the first major political announcement of the year, Minister for the Environment, Nick Smith, unveiled his long-awaited proposal for substantial reform of the Resource Management Act 1991 (RMA). A full transcript of the Minister’s speech can be found here.

The Minister outlined 10 key areas of focus to remedy the RMA, which he said has “some fundamental design flaws” that need rectifying.

In relation to these, some of the key changes as outlined by the Minister were:

  • amendments to the principles of the Act contained in sections 6 and 7, including adding provision for infrastructure and the management of natural hazards, and proper recognition of both the urban environment and the importance of affordable housing;
  • more explicit recognition of property rights (and limiting the degree to which council officials “can meddle in people’s lives”);
  • the establishment of national planning templates and a focus on speeding up the plan-making process;
  • amendments to facilitate and encourage a more “collaborative” approach to resolving resource management issues;
  • strengthening the powers for national regulation through National Policy Statements (NPS) and National Environmental Standards (NES); and
  • modernising the Act for the “internet era” (in terms of moving to electronic communications and making plans available online).

Our thoughts on the proposed changes

While the Minister has vowed not to interfere directly with the section 5 purpose of the Act, its central supporting provisions (sections 6 and 7) are likely to undergo “significant changes” in the upcoming reforms. We understand the existing structure of sections 6 and 7 is likely to be preserved, so that the two sections would not be amalgamated as former Minister for the Environment, Amy Adams, had planned. With a focus shift from purely environmental and cultural principles to ones relating to infrastructure, the urban environment and affordable housing, any changes to sections 6 and 7 are likely to be contentious. The weight the additions are given in relation to the existing Part 2 matters may ultimately have to be decided by the Courts.

The Minister's comments that the RMA “is stymying much needed infrastructure” and that “good infrastructure is essential to the functioning of a modern nation” can be seen as positive signals for infrastructure operators, and  reaffirm the Government's commitment to enabling business and development. Whether infrastructure will be merely given recognition in Part 2 of the RMA or be bolstered further by additional changes in other parts of the Act has yet to be revealed.

The Minister’s desire to reduce council “meddling” is also a key facet of the upcoming reform, and is likely to manifest in a number of RMA amendments (or supporting policies) aimed at providing national guidance to local councils, promoting private property rights and speeding-up plan making. Changes are also anticipated with respect to plan change appeals to the Environment Court.

An increased focus on the collaborative approach to resource management, one of the key items in the Minister’s speech, seems likely to be encouraged and incentivised rather than being mandatory (given collaboration is supposed to be voluntary in nature). For example, it might be that collaboration could be a pre-requisite to unlocking one of the new short-cut plan processes.  

The Minister has expressed a desire to overhaul the NPS and NES tools so that they are easier to use, implement and enforce. He intends to reduce consultation to one national round and implement an instant fine regime for the national planning mechanisms. In his speech, the Minister gave the example of a rule banning dairy cows from streams and rivers, but it is likely that a new National Policy Statement facilitating infrastructure and development is also being considered.

Moving Forward

The Minister’s intention is to have a Bill drafted and introduced in the first half of the year, advancing to a full select committee process for passage by year’s end. Although the skeleton of the proposal has now been revealed, we expect it will be over the next month or so that the finer details and policy decisions are fleshed out. Given the breadth and extent of the signalled amendments, it will be interesting to see whether all of the proposed changes are released in one round of amendments, or whether some take longer to develop.

David Alley

EPA also declines second EEZ application in Chatham Rock Phosphate decision

The EPA’s delegated Decision Making Committee (DMC) has declined the second application lodged under new EEZ legislation to mine in the EEZ, preventing Chatham Rock Phosphate (CRP) from mining phosphate nodules on the Chatham Rise. This follows on from the decline of Trans-Tasman Resources’ (TTR) application to mine iron sands in the South Taranaki Bight, re-igniting questions around the adequacy of the EEZ legislation.

As with the TTR decision, the DMC for the CRP application had three key matters to consider under the Exclusive Economic Zone and Continental Shelf (Environmental Effects) Act 2012 (EEZ Act). These were:

  • under section 59, decision making criteria including effects on the environment or existing interests from the activity and the economic benefit to New Zealand of allowing the activity;
  • under section 60, the manner in which the effects on existing interests of allowing the activity are to be taken into account; and
  • under section 61, that the DMC must base its decision on the best available information and take into account any uncertainty or inadequacy in the information available.

The DMC ultimately found that the destructive effects of the extraction activities, coupled with the potentially significant impact of the deposition of sediment on the areas adjacent to the mining blocks and on the wider marine environment, could not be mitigated by any set of conditions or adaptive management regime that might reasonably be imposed.

The DMC considered that the impact of the “drag-head” (the part of the mining machinery that would be trailed over the seabed) on the seabed, and on the benthic fauna in and on the seabed, was a major concern, given that:

  • these effects could not be avoided, remedied or mitigated;
  • the mining would largely be occurring in an area where the seabed is currently protected from trawling and dredging by the Mid Chatham Rise Benthic Protection Area (BPA) (which protects the Mid Chatham Rise from bottom trawling and dredging by the fishing industry), and one of the purposes of the BPA would be undermined if the application were granted;
  • it would result in the destruction of marine communities dominated by protected stony corals that are potentially unique to the Chatham Rise, and which the DMC concluded are “rare and vulnerable ecosystems” (being one of the decision making criteria under section 59);
  • the affected habitat would not return to its present form but would be permanently transformed into soft sediment habitat; and
  • the return of waste material to the seabed (sediment disposed on the seabed after having been sucked up by the pump) also stood to have adverse effects on the benthic habitat.

The DMC considered there was a lack of certainty about both the nature of the receiving environment, and the adverse effects of the project on the environment and existing interests. It considered that some of this uncertainty stemmed from the fact that this would be the first seabed mining project ever undertaken at such depths anywhere in the world, and the heavy reliance placed on what it had found to be insufficiently validated modelling to predict the impacts of the project. This was despite a finding that it has the best available information (a requirement of the EEZ Act).

The DMC considered the proposal was unlikely to generate more than a modest economic benefit to New Zealand (taking into account the $24 million a year return to the Government from taxes and royalties), and that the benefits were “insubstantial relative to potential adverse environmental effects.”

It is difficult to reconcile the DMC’s findings that it had the “best available information” (defined as “the best information that, in the particular circumstances, is available without unreasonable cost, effort or time”) with its overall conclusion that there was too much uncertainty about the existing environment to grant the application. Based on the current state of scientific knowledge about the Chatham Rise, the expense involved in conducting surveys in the open sea, and the fact that much of the modelling could not be validated in situ until mining commenced, the DMC was satisfied that the information before it met the definition of “best available information”, in respect of the whole marine consent application area. 

However, the DMC went on to note a number of instances where it registered uncertainty and inadequacy of information, considering that there remained significant gaps in the data and information provided about the consent area's marine environment as well as uncertainty about the impact of the proposal on existing interests and the environment. It considered that although a complete understanding of the environment and absolute certainty about the risks posed by the proposal were not a prerequisite to the granting of a consent, scientific knowledge of the Chatham Rise ecosystem is “manifestly incomplete” and the DMC does need to have sufficient, and sufficiently certain, information to identify and evaluate the risks involved in a proposal such as this. Of particular concern to the DMC were uncertainties associated with modelling that could not be empirically and in situ validated before the commencement of mining.

The decision has reignited debate regarding the high threshold set by the requirement to “favour caution” in the EEZ Act. This obliges decision makers to favour caution and environmental protection when the information available in relation to an application is uncertain or inadequate. If this means that an activity is likely to be refused, consideration must then be given to whether taking an adaptive management approach would allow the activity to be undertaken. The DMC considered that to favour caution and environmental protection would, in this case, mean the proposal should be refused consent, and that an adaptive management approach would not resolve the primary question of the adverse effect on the benthic environment without considerable pre-mining research and model validation in situ, which the applicant informed the DMC was not a viable option. 

CRP chief executive Chris Castle commented that the decision sent a “closed for business” signal to would-be investors in New Zealand mineral resource extraction. CRP spent $33 million and seven years on its applications. In contrast, TTR says it has spent $70 million on its failed application to date. Given the focus of the current National Government on encouraging mining in New Zealand’s EEZ, and the apparent failure of the EEZ Act to deliver on that, it seems likely that a review of the legislation may occur sooner rather than later. 

Evie Rainey

Tukituki Catchment Proposal – High Court decision and referral back to the Board of Inquiry

In December, the High Court released its decision on the appeals by Forest and Bird, Fish and Game and the Environmental Defence Society in relation to the Tukituki Catchment Proposal (which comprises the Ruataniwha Water Storage Scheme and associated Plan Change 6 (PC6) to the Hawke’s Bay Regional Resource Management Plan).

The appeals focused on a “deeming” provision which was inserted into Rule TT1(j) of PC6 between the draft and final decisions of the Board of Inquiry. In its final decision on PC6, the Board adopted a “dual nutrient” approach to managing both phosphorus and nitrogen in the Tukituki Catchment by setting an in-stream dissolved inorganic nitrogen (DIN) limit and maximum on-land leaching rates for nitrogen, based on the Land Use Capability Classification System (LUC). 

The deeming provision stated that if a landowner was complying with the prescribed LUC leaching rates for their activity, they would be deemed to be meeting the DIN limit in the river. In essence, the amendment meant that farming would be a permitted activity under PC6 if farmers met the specified LUC leaching rates within the catchment, and the DIN limit would be treated as an indicator of the success of the methods in the Regional Plan, rather than a limit linked to individual farm consents.

The High Court found that the introduction of the deeming provision produced the following errors of law:

  • As the deeming provision had not been suggested by any party and was devised by the Board without consultation, the Court considered the Board had a duty to re-consult the parties about the contents of the rule. By failing to provide the parties with an opportunity to comment on the change to Rule TT1(j), the Board made a material error of law.
  • By introducing the deeming provision into Rule TT1(j), the Court found that the Board failed to give proper effect to sections 5(2)(c) and 67(3)(a) of the Resource Management Act 1991 or to the National Policy Statement for Freshwater Management 2011 (NPSFM 2011). (As the final decision of the Board was released prior to the NPSFM 2014 coming into force, PC6 was required to give effect to the NPSFM 2011).   

An additional appeal point by EDS, that Objective TT1(f) (which provides for the use of water for primary production and other manufacturing uses), was inconsistent with the NPSFM 2011, was declined by the Court.  

The High Court remitted both Rule TT1(j) of PC6 and the consents for the Ruataniwha Storage Scheme back to the Board to reconsider. The Court directed that when the Board reconsiders and changes Rule TT1(j) it should avoid creating a factual fiction and ensure Rule TT1(j) gives effect to all relevant provisions of the NPSFM 2014.

Since the High Court decision, the Board has reconvened to hear from the parties on the scope of the re-hearing, and sought that the parties provide suggested wording of TT1(j).

Russell McVeagh acts for a group of primary production interests in these proceedings. 

Anna McConachy

Changes to the resource consent process now in force

The final stage of the Resource Management Amendment Act 2013 amendments came into effect on 3 March 2015, and are intended to further simplify and streamline the resource consent process. 

The changes apply to applications lodged on or after 3 March 2015, and include:

  • Amendments to existing processing timeframes that are designed to effect a “six month” (130 working days) timeframe for decision-making on notified applications, a 100 working day timeframe for decision-making for limited notified applications, and a 60 working day timeframe for notified or limited notified applications with no hearing.
  • The time taken by a hearing being included in the statutory timeframes. The period between the close of submissions and the close of the hearing is now fixed at 75 working days for notified applications and 45 working days for limited notified applications.
  • Consent authorities now have more time to accept applications (10 working days, as compared with 5 working days previously) and to decide whether to notify them (20 working days, as compared with 10 working days previously).
  • A clearer and more comprehensive set of criteria for applicants preparing applications, and consent authorities accepting them (set out in Schedule 4 of the RMA).
  • Only one ‘clock stop’ of the above timeframes for further information requests (reduced from two), which can now only occur before the application is notified. The consent authority can still request further information at any time following the initial request, but the clock will not be stopped.
  • A consent authority now has the ability to close submissions early and continue processing an application if submissions, written approvals, or other instructions have been received from all notified parties;
  • An applicant can now request that processing of the application be suspended for up to 130 working days under the new section 91A, in order to give them more time to prepare between the close of submissions and the hearing.
  • Mandatory pre-lodgement of evidence or reports, to occur within a specified number of days before the hearing, as follows: 
    • section 42A report(s) – no less than 15 working days;  
    • applicant's evidence – no less than 10 working days; and
    • submitter's evidence – no less than 5 working days.

Consent authorities still have the power to extend statutory timeframes due to special circumstances, or with the agreement of the applicant. In addition, an application can still be placed on hold at any time if the consent authority decides to commission a report and the applicant does not refuse to agree to this.

Overall, we consider that these amendments should result in greater certainty for business, an enhanced ability for applicants to control the progress of their application, and more detailed and available information throughout the resource consent process. 

It is important for both consent authorities and applicants to be aware of the above changes (particularly the changes to timeframes that people have become accustomed to) in order to meet the requirements of this new streamlined approach to the processing of resource consent applications. Further changes to resource consent processes are likely under the recently announced reforms.

David Alley

Unitary plan update – interim guidance released

Over the last month the Unitary Plan Hearings Panel has released its first items of interim guidance on the proposed Auckland Unitary Plan, much earlier than expected.

The guidance provides a clear steer in respect of rural subdivision, the Rural Urban Boundary, infrastructure and energy, the structure of the Regional Policy Statement and the administrative provisions in Chapter G: General Provisions. The interim guidance demonstrates that the Panel is willing to depart from the notified provisions where it considers that to be appropriate and where there is strong evidence from submitters supporting a change. The guidance provides helpful clarification that will inform upcoming mediations and hearings on the lower order provisions.

Our two most recent Unitary Plan Updates (here and here) include a summary of the interim guidance released to date, links to that guidance, and an overview of recent changes to the Hearings Panel’s hearing schedules. Future Unitary Plan Updates will cover any new interim guidance, as well as any other Unitary Plan developments. Please contact us if you would like to subscribe.

Michael Doesburg

Christchurch Replacement District Plan hearings under way

The hearings are in full swing for the Stage One chapters of the Proposed Christchurch Replacement District Plan (Proposed Plan). The Independent Hearings Panel (Panel) has already made its decisions on four “priority matters”. The Panel has final decision-making power, unlike the Panel in the Auckland Unitary Plan process, where Auckland Council retains the ability to accept or reject recommendations. Panel members include former High Court Judge Sir John Hansen (Chair), Environment Court Judge John Hassan (Deputy Chair), Sarah Dawson, Jane Huria, Dr Phil Mitchell and John Sax.

The four priority matters were:

  • the Strategic Directions chapter;
  • temporary activities related to earthquake recovery;
  • repair and rebuilding of multi-unit residential complexes; and
  • rezoning for certain exemplar housing areas.

The Panel released its decisions on these matters on 26 February 2015. In its decision on the Strategic Direction chapter, the Panel was critical of both the Council's section 32 report and its evidence, while commenting that the Crown/CERA had called relevant, substantive and independent advice, which provided a thorough analysis of the issues and how they should inform the chapter. It urged the Council to be mindful of the importance of coherence and consistency in drafting the provisions of the further chapters of the Proposed Plan.

Hearings on the remaining Stage One chapters start this month. Of note in relation to the Natural Hazards chapter is a Memorandum of Counsel filed on behalf of the Council regarding Liquefaction Rule 5.9.1. As notified, the rule suggests that there are no permitted activities in Liquefaction Assessment Areas 1 and 2, which cover the majority of Christchurch. The Memorandum clarifies that this was not the intention of Rule 5.9.1, and proposes an amendment to state that this rule applies only to certain listed activities, with all other activities being permitted. This is likely to reduce the scope and extent of the Natural Hazards hearing.

A further interesting development is a private plan change request by Memorial Avenue Investments Limited, which seeks the rezoning of a site close to Christchurch Airport to facilitate the development of a Business Park. The Order in Council setting out the process for the Proposed Plan uniquely allows private plan change requests to be considered by the Panel as part of the Proposed Plan review. Requests become subject to submissions and there will be a hearing before the Panel, rather than a separate Council hearing. The hearing of this particular request is scheduled for May 2015.

Going forward, key dates for the Stage Two chapters are as follows:

  • Notification – 2 May 2015.
  • Submissions open – 2 May 2015 to 15 June 2015.
  • Submissions published, further submissions open – 29 June 2015 to 13 July 2015.
  • Further submissions published – 27 July 2015.
  • Panel required to make its final decisions on all chapters – 9 March 2016.

Our previous Christchurch updates (available here and here) provide greater detail on the process for the Proposed Plan. Russell McVeagh is acting for several submitters in relation to the wider Proposed Plan and the private plan change request.

Jess Riddell and Annabel Linterman

Canterbury Earthquake Recovery Minister announces Advisory Board on Transition

With the Canterbury Earthquake Recovery Act 2011 (Recovery Act) due to expire in April 2016, the Minister for Canterbury Earthquake Recovery, Gerry Brownlee (Minister), has established an Advisory Board on Transition (Board). The Board’s function is to provide the Minister with advice on the shift of functions and powers held by the Canterbury Earthquake Recovery Authority (CERA) to local authorities.

At the start of February, CERA moved from being a stand-alone Government department to an agency within the Department of Prime Minister and Cabinet. This was the first major step in the winding back of CERA’s special earthquake powers.

Chaired by former Prime Minister Dame Jenny Shipley and described as including the “who’s who of Canterbury powerbrokers”, the Board is made up of key players in the community and business sectors, and representatives of the various local and regional councils. It will operate until December 2015.  

The Board's first task is to develop a transitional plan to help guide Canterbury’s recovery over the coming years. Key considerations include:

  • whether CERA in its entirety is still needed;
  • whether its responsibilities can be shifted to existing agencies, or whether a new recovery organisation may need to be established;
  • staffing levels within CERA; and
  • which provisions of the Recovery Act may need extending beyond April 2016, and which provisions, and powers, are no longer needed.

The nature and status of the transitional plan, particularly how it relates to the relevant legislation and various recovery and rebuild plans that have been developed following the earthquakes is unclear at this stage. There is likely to be consultation on the plan with those “directly affected”, although the scope and extent of such consultation is also uncertain. The Board is aiming to prepare a draft version over the next three months, with the final plan released in mid 2015.

Annabel Linterman

Long term plan – what's in store for Auckland’s long term future?

To kick start the year Auckland Council has recently released its draft Long-term Plan 2015-2025 (LTP) and draft Development Contributions Policy (DC Policy) for consultation. The LTP outlines the Council’s priority projects and sets out how it plans to pay for these over the next decade. The DC Policy sets out the contributions developers will be required to pay the Council to cover the cost of providing new or improved infrastructure. Consultation on both documents closes at 4pm on Monday 16 March 2015.

The LTP proposes a rates increase for existing households and businesses by an average of 3.5% each year. This works out to an average general rates increase next year of 5.6% for residential properties, 1.6% for businesses and a decrease of 8.4% for farms and lifestyle properties. The LTP also sets out alternative rates options (such as a larger increase in rates for businesses, or alternatively for residential properties), and seeks feedback from the public on these options.

While the LTP recognises that transport is the single biggest issue for Auckland, the Council is only proposing a $6.9 billion transport package, 33% less than what was previously planned. This will result in significant reductions in levels of service, fewer public transport improvements, and the deferral of some projects and maintenance. This basic transport package prioritises projects such as the City Rail Link, but does not allow for proposed local and arterial roading projects or additional investment in walking, cycling, and bus lanes.  

To fund a more comprehensive transport program, the LTP lists two options: increasing fuel taxes by 1.2 cents per litre each year and a new targeted rate; or a motorway user charge of around $2 each time people enter Auckland’s motorway system depending on the time of day.  In our view, feedback on this issue is important as it will inform Auckland Transport’s Regional Land Transport Plan, which outlines how transport providers intend to respond to growth and other challenges facing Auckland over the next 10 years.

The LTP also confirms that the Council is proposing to replace Waterfront Auckland and Auckland Council Properties Ltd with a new CCO called “Development Auckland” to more effectively partner with central government, iwi and developers to redevelop council owned land for intensive housing, including apartments and terrace houses, and commercial development. The Council does not expect this change to result in increases to rates or debt levels, or that any significant financial impacts will result from taking this more active role in terms of rates and the council’s debt. However, future partnering arrangements are likely to be on a more significant scale.

As expected, the Council still proposes to use DCs as the primary funding source for growth, and only use financial contributions (ie conditions on resource consents) in limited circumstances where DCs cannot be applied. The DC Policy contains changes to reflect the amendments made last year to the Local Government Act 2002, such as changing the definition of community infrastructure in the DC Policy to exclude libraries, swimming pools (which are to be funded by general rates) and confirmation that non-residential developments cannot be charged DCs for reserves. Another positive change is that the DC Policy proposes to increase the number of funding areas for stormwater and transport DCs to better reflect how such infrastructure is usually specific to part of a catchment and therefore investment demand can be more easily identified by location. It also proposes to base residential DCs on house size as well as house type (ie detached dwellings vs attached low/medium/high rise) to better reflect the level of demand they create for new infrastructure.

Jess Riddell and Lucy Edwards

Greater Wellington Regional Council’s Draft Natural Resources Plan – Next steps

The time for providing informal feedback on the Greater Wellington Regional Council’s (GWRC) draft Natural Resources Plan has now closed, with the proposed plan to be formally notified later this year.

The Natural Resources Plan will supersede the current GWRC regional plans for air, land, freshwater water and soil (our summary of the Plan in an earlier Resource Management update is available here). 

Stakeholder feedback on the draft plan has been made available online here, and is categorised by the chapter of the plan to which it relates.

Of particular interest is the feedback provided in relation to proposed rules around excluding stock from water bodies. Submitters queried the inclusion of these rules prior to the water catchments having been assessed for water quality and national values to be attributed to them, and commented that the cost-benefit analysis is lacking with regard to excluding stock where stock numbers are low.

GWRC staff working on the plan will now review the feedback and clarify any further questions they have with people who have provided feedback. Once this process is complete, the proposed Natural Resources Plan will be approved by the Council and be notified for submissions, currently scheduled for around mid to late 2015.

Evie Rainey

HSNO reform update

The Environmental Protection Authority’s (EPA) consultation period for the recently proposed EPA Notices closed on 20 February 2015. The EPA Notices will provide the EPA with its own regulatory instruments, as part of the new health and safety reform currently before the House of Representatives. The consultation documents can be found on the EPA’s website.  

WorkSafe NZ has also taken over the regulation of hazardous substances in the workplace, in anticipation of the approaching reforms. 

The five EPA Notices released for consultation included:

  • Hazard classification system.
  • Labelling.
  • Safety data sheets.
  • Packaging.
  • Enforcement officer qualifications.

These proposed EPA Notices are intended to streamline and consolidate the current Hazardous Substances and New Organisms (HSNO) regime in New Zealand, as the current system was considered to be unworkable and complex. The EPA intend to develop further notices covering hazardous property controls, importation and manufacturing, and disposal requirements, although there has been no indication of timeframes at this point.    

One of the proposed changes in the health and safety reform legislation is for WorkSafe NZ to take over regulation of the use of hazardous substances in the workplace, including the setting of controls to manage workplace risks relating to hazardous substances. As of 1 September 2014, WorkSafe NZ has been delegated authority by the EPA to regulate test certification, controlled substance licences, and approvals for equipment to be used in workplaces.  

The EPA will continue to approve all hazardous substances manufactured in, or imported into, New Zealand and will assign the hazard classification and set certain “base” controls that will apply regardless of where the substance is used (ie in a workplace environment or not). The EPA Notices are the mechanism for this purpose. Rather than needing Cabinet approval to create/amend the EPA Notices (as would be required for regulations), the EPA Board will have the authority to approve these new regulatory instruments, making it easier for them to be kept up to date and workable.

The process that the EPA will follow will be to:

  • Identify the need for an EPA Notice.
  • Draft a proposal.
  • Publicly announce the proposal and consult with stakeholders.
  • Receive and consider submissions.
  • EPA Notice to be signed by the Chair of the EPA Board and then published in the New Zealand Gazette.

As the submission period for the first round of EPA Notices has now closed, the EPA will prepare a summary of the feedback received and then begin to draft the notices. The first five notices are intended to come into force when the health and safety legislation comes into effect, amending the HSNO Act, in approximately April 2015.

Fresh guidance on freshwater management

The Ministry for the Environment (MfE) has issued two draft guidelines relating to the management of freshwater, and specifically the interpretation of the National Policy Statement for Freshwater Management 2014 (NPSFM). MfE has sought public feedback on the NPSFM 2014: Draft Implementation Guide (Implementation Guide) and the Freshwater Accounting: Draft Guidance for Regional Authorities (Freshwater Accounting Guide) (together, Draft Guides), with final versions expected to be released in early 2015.

The Draft Guides are timely due to ongoing litigation in the freshwater management space, including in relation to the requirement to give effect to the NPSFM in regional plans and policy statements. In light of the Supreme Court’s decision in Environmental Defence Society Inc v New Zealand King Salmon Company Ltd [2014] NZSC 38, there will need to be careful consideration as to how to give effect to the NPSFM in developing regional plans. The Draft Guides, while not intended to be prescriptive, seek to shape the implementation of robust national standards for water quality and to recognise the current shift in practice towards collaborative planning in the management of freshwater. 

Implementation Guide

Councils must produce an implementation plan under the NPSFM as soon as reasonably practicable, or no later than 31 December 2025 (or, where that is impracticable or would result in lower quality planning, by 31 December 2030). The Implementation Guide provides information about the policy intent of the NPSFM to assist local authorities, planning practitioners and water users to understand the objectives, policies, concepts and processes within the NPSFM, and to help local authorities consider how the NPSFM should be implemented.  

Key points from the Implementation Guide are set out below:

  • While the NPSFM objectives and policies provide “initial direction”, regional councils need to supplement this using a “holistic, or whole of catchment, response using a variety of tools and methods”.
  • Achieving Objective A1 of the NPSFM will require understanding of the sources and amount of relevant contaminants; establishing environmental flows and managing within set limits; and setting freshwater objectives for attributes that are relevant to safeguarding the life-supporting capacity, ecosystem processes and indigenous species of a water body (including their associated ecosystems – not just the attributes that are currently included in the National Objectives Framework).
  • Freshwater objectives can be set at a variety of scales and levels of detail. Freshwater objectives in regional plans should be numeric, and use the attributes and attribute states supplied in Appendix 2 of the NPSFM. Numeric attributes can be supported with a narrative, which may outline an acceptable degree of change, an outcome or parameters sought.
  • In relation to over-allocation, a target is a limit to be met at a defined time in the future. Management of both point source and diffuse discharges may be required through targets to claw back over-allocation over time.
  • In relation to accounting for freshwater contaminants, sources are most usefully grouped into background, point and diffuse sources, with these typically further broken down by land use type. This grouping can further assist with assessing the economic impact of specific objectives to particular sectors.
  • In achieving the policies and objectives in the NPSFM, it is appropriate to prioritise catchments, and tools are available that can help develop a programme to ensure improvements with the highest benefit compared to cost are achieved first.

The Implementation Guide does not contain any commentary on possible exceptions to be included in Appendix 3 of the NPSFM (which sets out that the Council can only set an objective below a national bottom line where the water quality is below the bottom line for listed existing infrastructure), leaving this to be determined by Government engagement with councils, iwi and infrastructure owners.

Freshwater Accounting Guide

The NPSFM requires freshwater accounting systems to be created and used. The Freshwater Accounting Guide provides general guidance, from which regional and unitary councils can undertake region-specific freshwater accounting systems for both water quantity and quality. It confirms that under a freshwater quantity accounting system, all water takes must be quantified (including under a resource consent and permitted takes eg stock water) and under a freshwater quality accounting system, all relevant contaminants discharged (including from point sources and diffuse sources) must be quantified.

The Freshwater Accounting Guide confirms that accounting happens in accordance with Policy CC1(b) of the NPSFM ie “at levels of details that are commensurate with the significance of freshwater quality and freshwater quantity issues, respectively, in each freshwater management unit”. It also sets out nine high-level principles of freshwater accounting, being that it should be: risk-based, transparent, technically robust, practical, effective and relevant, timely, promote partnership (with stakeholders and community), adaptable and integrated (for instance, permits integration of surface water and groundwater or discharge to receiving waters, such as estuaries).

The Freshwater Accounting Guide notes that freshwater management units (FMUs) should reflect common objectives for the waterbodies within them to enable representative monitoring sites to be easily established and states that cost-effectiveness is a relevant consideration when selecting FMUs. However, the draft guide goes on to provide that while the FMU is the fundamental unit of freshwater accounting, it may inform other processes beyond the NPSFM – theoretically operating at a regional, FMU, catchment or sub-catchment level or even at activity (individual take or point source) level, depending on the needs of the council and the information available. MfE is currently preparing draft guidance on the establishment of FMUs, as well as on the requirement to maintain or improve overall water quality across a region, establishing monitoring systems, and the use of models. These will complement the Freshwater Accounting Guide.

Next steps

As part of Minister Nick Smith's proposed “overhaul” of the RMA, the Minister observed that the RMA “is not doing a particularly good job of managing vital natural resources like freshwater and the coastal environment”. While industries and processes will benefit from the guidance in terms of increased certainty and efficiency gains, freshwater reform is high on the political agenda and more concrete guidance could be useful in terms of dealing with water quality issues, over-allocation, compliance and offsetting. 

Chaturika Jayasinghe

DOC releases guidance document on biodiversity offsetting in the RMA context

Amidst continued international debate on the use of biodiversity offsetting as a tool to address the residual adverse environmental effects of development, the Department of Conservation (DOC) has finalised its long-awaited Guidance on Good Practice Biodiversity Offsetting in New Zealand (Guidance). The Guidance sets out good practice guidelines for biodiversity offsetting and seeks to clarify its use and appropriateness in the Resource Management Act 1991 (RMA) context.

At a basic level, biodiversity offsetting involves the exchange of measureable, equivalent conservation gains for residual biodiversity loss associated with development. The stated goal of a biodiversity offsetting approach is often to achieve “no net loss” of biodiversity. However, this does not completely align with the sustainable management purpose of the RMA because while the RMA requires adverse effects to be avoided, remedied or mitigated, it is not a “no effects” or “zero sum” statute and offsetting is neither referenced, nor required, within it.  In the leading Buller Coal case, the High Court treated biodiversity offsets as a “positive environmental effect” to be taken into account when considering consent applications (i.e. outside the “avoid, remedy, and mitigate” requirement). At present, this approach is widely accepted and the Guidance provides practical assistance to applicants on this basis.

The Guidance draws from the principles and methodologies of the international Business and Biodiversity Offsets Programme (BBOP), and seeks to adapt them in to the RMA framework. It recognises the difficulties inherent in planning and implementing biodiversity offsets (including in measuring biodiversity loss, and then seeking to achieve a “like for like” exchange), and provides a number of assessment frameworks and risk classification systems to assist applicants in measuring the value of biodiversity (both at the site of impact and proposed offset sites), and also the overall likelihood of success of a given offsetting proposal.

The Guidance also outlines a number of best practice principles, suggesting that applicants should:

  • identify and engage with stakeholders throughout the offsetting process;
  • choose a scientifically defensible “currency” to measure biodiversity lost and created or enhanced;
  • seek to achieve a “like for like” exchange;
  • design biodiversity offsets so that gains are maintained long-term;
  • plan ongoing monitoring and assessment of compliance; and
  • demonstrate that “but for” the applicant's intention to deliver specific conservation outcomes through offsetting, those outcomes would not have otherwise occurred. 

The Guidance is a useful tool for both applicants and decision-makers. While the concept (and possibly its application in areas outside of biodiversity, such as air or water quality) arguably needs stronger national direction, it goes some way to providing clarification as to the Government’s position on biodiversity offsetting. 

Annabel Linterman and Tom Stuart

Environment Court shows improved operations in its inaugural Annual Review

The Environment Court has, for the first time, provided an Annual Review of its operations in 2014 (Report).  This article sets out some of the key points coming out of the Report.

The Report covers a number of topics, including the nature of the Court’s work in 2014, the Registries, concerns about some reporting of the Court’s performance, and initiatives and innovations.

2014 Case lLad

With regard to the Court's progress in 2014, the Report states that clearance rates of cases (including of cases in the Court’s backlog) reached a high level during 2014. There were 333 registrations of new cases, and the Court disposed of 694 cases overall. The Report notes that this was particularly high for plan appeals, with a clearance rate for plan and policy statement appeals of 385% (including cases in the backlog). The Court achieved a clearance rate of 157% for resource consent appeals, and 123% for other miscellaneous applications (such as declaratory and enforcement proceedings). The Court considers that although societal factors are at play, in terms of diminishing quantities of work flowing to the Court, robust case management, alternative dispute resolution (ADR) activities and streamlined hearing techniques, together with increasing use of modern technology, have also had a significant impact.

In terms of the nature of the Court’s work in 2014, the Court considers that the development of mediation and other forms of ADR have significantly re-cast the previous Court workload. It believes that these processes resolve approximately three-quarters of the cases brought to the Court. The Report states that the Court is increasingly confronted with large, multi-party, multi-issue causes, including on direct referral from Councils, and that hearing time before the Court is therefore increasingly devoted to these larger cases (with many of the smaller ones being resolved by ADR methods).

The Report discusses the current case management tracks, noting that the Court has been successful in reducing the life of cases to the point where there is now no backlog of cases awaiting mediation, hearing, or other court time.

In discussing adjudication by hearing, the Report comments that Judges and Commissioners now read all evidence and other material ahead of the hearing, and it is now most unusual for any evidence to be read out in court. This has substantially cut the length (and therefore cost) of Environment Court hearings.

Direct Referrals

With regard to direct referrals, the Report notes that of the four applications in 2014, two were decided by the Court within six months, the third was decided within eight months, and the fourth was the subject of settlement (with a hearing conducted within six months of lodgement). 

The report comments that applicants having to pay for the Court’s cost is now a recognised feature of the direct referral processes, assisted by an informal scale of costs maintained by the registrar. While in our experience costs awards have tended to be relatively high, the Report claims that in direct referral cases concluded in the last four years agreement as to costs has generally been reached between applicants and the Registrar at a relatively conservative levels.

Mediation

The Report also discusses mediation, stating that the Court makes significant and increasing use of ADR before or at any time during the course of a hearing. While mediation is traditionally thought of as a voluntary process, the Report comments that because most Environment Court  cases are laced with significant public interest issues, this colours its approach along the “voluntary” to “compulsory” mediation spectrum, “somewhat in the direction of compulsion.”

Registries and Environment Court Performance

The Report canvasses the work of the Registries, noting that results of surveys of parties concerning the quality of services offered by registry staff (particularly in 2014) indicated a very high level of satisfaction. 

With regard to the Court, the Report spends some time discussing concerns about some reporting of the Court’s performance. It notes that a shortage of quality official information allows outsiders, “usually possessed only of anecdotal information, (sometimes manipulated for a particular purpose) to make public claims about shortcomings in the timeliness of the work of the Court.” It lists some examples of such claims before asserting that the Environment Court safeguards the quality of process and decisions.

The Report goes on to discuss appeals on policy statements, plan reviews and plan changes, noting that in recent examples mediation has been undertaken as soon as all parties have been identified under section 274, and the appeals have been brought to a conclusion about 10 or 11 months after cases being filed, with a “high degree of success.” Councils being able to resolve to make large parts of the proposed instruments operative in short order means that the Court has been able to move quickly to resolving remaining issues through hearings, facilitated conferences of experts and pre-hearing and settlement conferences. 

The Productivity Commission’s final report of 2013 expressed a recommendation that the Environment Court’s mediation capability be made available to support the local authority plan making processes. The Court notes that while this is indeed being undertaken in some degree in the proposed Auckland Unitary Plan and Christchurch Replacement District Plan processes, to extend mediations and expert facilitators across all council regulatory hearing processes would require effectively a 100% greater level of ADR activity than that presently undertaken by the Court.  

The Report discusses the series of workshops the Court is planning to undertake, in conjunction with the Resource Management Law Association, relating to plan drafting. It considers that many aspects of plan and policy statement writing could be significantly improved by study and implementation of best practice, for instance succinctness, clarity, legality, logical structure, consistency, and approachability.

The Report also comments on the suggestion (particularly from within local government) that it is inappropriate for “unelected” people (ie the members of the Court) to alter local government policy, for example in terms of consistency with National Policy Statements and National Environment Standards. The Environment Court rejects this criticism, stating that the work of the Court on appeal is defined and constrained, and in any event, independent hearing commissioners on Council hearing panels are as “unelected” as members of the Environment Court.

Initiatives and Innovations

The Report spends some time detailing recent initiatives and innovations, in particular with regard to the recent use of iPads in the Court. The use of iPads trialled in some recent large cases, including Buller Coal and Hagley Park Cricket Ground, has been heralded as a success, so that all members of the Court and their Hearing Managers have now adopted this practice.

The Report notes with disappointment that the initiatives from the Ministry of Justice to commence a pilot program for electronic filing seems to have stalled. The Court’s ultimate goal is to become as paperless as possible.

This inaugural Report from the Environment Court is detailed and comprehensive, providing a useful insight into the Court’s activities and function. It also comes at a time when the recently announced RMA reforms could have substantial implications for the role and jurisdiction of the Court.

Evie Rainey

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