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«December 2011 Victorian Planning System Ministerial Advisory Committee Initial Report. Geoff Underwood, Chair. Catherine Heggen, Member. David ...»

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It is a guideline not a control. It states either what the responsible authority will do in specified circumstances or what the responsible authority expects should happen. The consistent application of policy over time should achieve a desired outcome.

The operation of Local Planning Policy has however become unclear over time. In many planning schemes, it has replaced other components of the planning scheme as the primary method of expressing strategic direction. This has led to a proliferation of local policy and confusion about how local planning policy should be used and what it can or should deliver. Ultimately this has led to considerable uncertainty within the planning system.

To address this, Action 10 in the Cutting red tape in planning report (DSE August 2006) included a number of actions to make local policy stronger. To inform the implementation of these actions the Minister

for Planning appointed a working group to:

Examine the role of local planning policy in decision making.

Develop local policy implementation principles.

Clarify the relationship between state and local policy.

Promote local policy that implements local and state planning policy objectives.

Inform a Ministerial statement on local policy.

The working group included planners, local government representatives and officers of the Victorian Civil and Administrative Tribunal, Planning Panels Victoria and the Department of Sustainability and Environment. The working group heard submissions from the development industry and local government. In proposing significant changes to the application of the VPP, there was unanimity within the group. The working group considers that the VPP are basically sound and provide a good foundation for land use planning in Victoria. The strategically driven and primarily performance based nature of the system remain positive attributes of the Victorian planning system. In

particular, the working group supports the following principles:

State policy must provide the overarching policy framework.

Local policies and provisions should provide the ability to deal with local objectives provided they are consistent with state and regional objectives and provisions.

Initial Report - December 2011 83 Victorian Planning System Ministerial Advisory Committee Local planning policy should provide guidance to discretionary decision making.

However, after ten years of operation the application of some components of the VPP needs immediate clarification and action.

The key issues are:

- The development of voluminous local policies;

- The need to clearly define and differentiate state and local interests;

- The importance of effective policies and controls to deliver strategic outcomes at both state and local level;

- The need to revise land use zones and overlays so that they better fit state and local strategic objectives; and

- That DSE and local government must work in partnership to achieve the improvements to the planning system.

The working group recommends the following Action Plan. The actions are complementary and will progressively make local

policy stronger. This will be achieved by:

- Ensuring the VPP tools are effective in delivering both state and local policy.

- Clearly identifying when local planning policy frameworks and state planning policy frameworks operate.

- Making local planning policy frameworks more focused, simpler and clearer.

- Enabling prescription where appropriate by converting policy to zones, overlays and schedules where control rather than discretion is desirable.

Implementation of the actions must be underpinned by a cooperative partnership between DSE and local government that promotes consistency and guides continuous improvement of the VPP.” Noting the submissions and taking into account the Committee's own experience, the Committee believes that consideration needs to be given to whether these reports have resulted in any meaningful changes or whether the vexed issue of local policy and its role in the planning system still remains. The Committee’s preliminary view is that the issue is far from resolved.

The Committee questions whether the role that the Clause 22 local policy plays in the planning system is really necessary and if it is, whether the guidance provided by local policies is best expressed within a Clause 22 type environment or whether it could be better expressed and repositioned in the context of the current model of the planning scheme.

–  –  –

A number of submittors and previous reports suggest that other logical candidates for housing the local content or local guidance could be zones, overlays or particular provisions or perhaps new schedules to these provisions.

This would enable some local content to be set out not unlike that which occurs with some zones (Residential 1 Zone schedule) overlays (such as the Neighbourhood Character Overlay) and particular provisions such as the schedule within the gaming provisions that enables local content to be added.

KEY FINDING Local Planning Policy The Committee questions the role of the Clause 22 local policy and whether it should remain in its current form. Any reorganisation of Clause 22 has the capacity to affect the structure of the VPP and planning schemes.

–  –  –

9. The Administration of the Planning System There are various facets of the planning system that are essential to how the planning system is administered. Some of the key issues that have been raised

in the submissions include:

Planning fees and costs;

Infrastructure charges by permit conditions;

Restrictive covenants;

Section 173 agreements;

The VPP with a particular emphasis on the structure and operation of zones and overlays;

Growth area planning and interface areas;

Stakeholder engagement; and Planning in rural and regional Victoria.

The Committee outlines the nature of the submissions regarding each of these issues below.

9.1 Planning Fees and Costs There are significant financial costs associated with any planning system.

Through submissions and presentations the Committee has heard from both proponents and responsible authorities as to the increasing cost of planning.

The preparation of a planning scheme and keeping it up to date through review and continuous improvement is costly. Planning studies and planning strategies have a significant ability to soak up funds. For example, it is not uncommon for a precinct structure planning exercise to cost in the order of $1 million for consultants and legal expertise.

The review of a MSS has been reported to cost in the order of $600,000 for a complex review. Lodging a permit application has costs associated with it.

Councils are required to employ staff to consider those applications. Some applications require councils to seek external advice from consultants.

Amendments to planning schemes are required to be based on sound strategic planning. Many of these costs are unavoidable.

The Committee identifies four areas in the submissions where particular

concerns are expressed:

Permit application fees and costs;

Planning review fees and costs;

–  –  –

Planning scheme amendments fees and costs; and Enforcement costs.

These are discussed below.

9.1.1 Permit Application Fees and Costs

Golden Plains Shire Council (Submission No. 172) states:

”Application fees Council raises serious concerns regarding the existing fee structure and its impact on limited resources. It is estimated that the assessment of a recent application for an extractive industry proposal cost the Golden Plains Shire in the order of $30,000 to process. The estimated cost of development stated by the applicant (an existing quarry operator who already owned mobile plant and machinery) was no more than $100,000 and as a result the fee for the application was calculated as $855.00. A sum of $29,145 therefore came straight out of a planning budget which could have been better spent on any number of projects to directly benefit our communities.

Complex applications typically require extensive community consultation in addition to expert technical and legal advice. Inevitably significant funds are then directed to a VCAT appeal as Officers are forced to defend a Council decision which already accurately reflects the objectives of State Policy.

It is considered that by increasing fees for certain types of applications Responsible Authorities will be able to redirect funds to value adding strategic planning projects or to the streamlining of internal assessment procedures.” Many councils raise the issue of planning fees. Fees are currently prescribed by the Planning and Environment (Fees) Interim Regulations 2011 (SR No. 63 of 2011). Fees are not based on the cost of delivering the service of considering a planning permit application.

Fees generated through planning applications do not go close to covering the costs incurred by councils in relation to its statutory planning responsibilities.

Councils submit that although it varies from council to council, planning application fees recoup little of the cost of running a statutory planning department. There is clearly a significant impost on a council in administering the statutory planning element of the planning system, even before taking into account the cost of any VCAT review or enforcement action.

It is not uncommon for a council to seek legal or expert advice on how to deal with a planning application. With the more complex applications, there are

–  –  –

significant costs incurred from the officer time spent in the assessment of an application.

The Committee was presented with interesting material in relation to the approach that exists in New Zealand which essentially involves a high level of cost recovery.

Some submittors note that the amount of supporting documentation required for a planning application requires many experts to be employed to prepare reports that have been requested by council. Many of the submissions suggest that these reports, such as green travel plans or community impact statements are reports that are above and beyond what is required in any planning application and often lack relevance to the application being considered.

Submissions received from permit applicants note that the holding costs associated with properties that are the subject of planning applications have the potential to become significant over extended periods of time.

KEY FINDINGS Permit Application Fees and Costs

The Committee considers:

The adequacy of the current schedule of application fees needs to be reviewed; and As part of the review of the fee schedule, the extent to which permit application fees can be used as a financial incentive or a penalty in the planning system to improve the processes, reward good practice and discourage poor practice by both responsible authorities, applicants and third party participants should be considered.

9.1.2 Planning Review Fees and Costs Submittors also cite the increased costs of planning when a matter is the subject of review at VCAT. Submittors argue that the costs associated with time delays were high and argued for a speedier review system.

In relation to objectors participating in the planning application process, submissions note that the level of costs has increased. Objectors must factor in the time required to meet with council officers as well as potentially presenting their objection at council meetings. Objectors must then consider should they wish to take the matter further, the personal costs that might be incurred as part of the price of participation in the system.

The number of planning applications that become the subject of review at VCAT remains relatively high. Submittors comment that the process for dealing with these applications remains a significant financial hurdle for those

–  –  –

seeking to be involved in the planning system. It is arguable that an increase in fees may deter vexatious litigants from being involved in the process. However, the same increase in fees may in turn prohibit other members of the community seeking to utilise their third party appeal rights in the planning process.

9.1.3 Planning Scheme Amendment Fees and Costs The planning scheme amendment process can be expensive for the council, proponents and submittors.

It was put to the Committee that the high cost of planning impacts on how up to date a planning scheme can be maintained.

Many councils indicate that the significant funds needed to undertake appropriate strategic planning and policy development are just not available and that the fees did not reflect the true cost of the work. The maximum fees that may be recouped by a council for an amendment under The Planning and Environment Regulations 2005 (the Regulations) is in the order of $2,918.

While larger councils in metropolitan Melbourne and country Victoria have the ability to spend significant amounts of money on policy development and implementation, medium and smaller councils are not in the same position.

From a regional Victoria perspective, some of the councils that presented to the Committee stated that the cost of planning is so prohibitive that in many situations strategic planning is not undertaken. This was especially made evident in the verbal submissions made to the Committee by the North East Planners Group.

Perhaps an extreme example, the Buloke Shire Council, in wanting to increase the supply of residential land in the town of Wycheproof is said to have been told by DPCD that it would be required to undertake a strategic assessment of land supply to justify a rezoning to produce about 20 lots. The Council has not proceeded because of the expense of doing so.

The Committee has also heard from smaller councils, where amounts of between $20,000 and $40,000 is often all that can be allocated in council budget to undertake complex strategic planning.

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