Attachments of Regional Strategy and Policy Committee

Regional Strategy and Policy Committee

04 February 2014

8. Auckland Council was established with a mandate to promote integrated decision making in New Zealand’s biggest city and to bring a step change in its performance that will improve quality of life for all of its residents and, ultimately, all New Zealanders. Subject to some relatively minor changes as documented throughout part one of this submission, there is much in this Bill that will help the council deliver on this mandate and hence it supports the majority of the proposed reforms including the:

· increased flexibility for councils to determine how to consult with their communities;

· introduction of consultation documents for annual and long term plans;

· requirement that councils develop an infrastructure strategy;

· proposals for a significance and engagement policy;

· provision for the more effective use of technology in council meetings; and

· creation of a reconsideration process for disputed development contributions decisions (not to be confused with the proposed independent objections process, which Auckland Council has serious concerns about).

9. Conversely, Auckland Council strongly opposes aspects of the proposed changes to the development contributions system. In particular, Auckland Council opposes the narrowed definition of community infrastructure, the lack of transitional provisions for this definition to take effect and the proposed independent objections process.

10. These changes to the development contributions system:

· will result in a substantial subsidisation of new ratepayers by existing ratepayers, which could produce an increase in the rates bills for Auckland households by 8.5 percent by 2021/22;

· could significantly damage the council’s ability to deliver the local infrastructure necessary to accommodate the growth expected across the region;

· could undermine the liveability of new communities in greenfield areas;

· could compromise the delivery of the Auckland Plan and the unitary plan.

11. Auckland Council has planned $480 million of capital expenditure in community infrastructure over the next ten years. This figure is based on an expectation that much of the debt incurred in undertaking the investment will be recouped through development contributions, as per the current legislation. The Bill limits the ability of the council to do this. This leaves the council with two choices – either have inadequate infrastructure or fund the cost of borrowing from existing ratepayers. The former option runs counter to the very reason why Auckland Council was established. The second option, however, will transfer part of the costs of growth from those who directly benefit from it (i.e. developers and new residents) to existing ratepayers. The additional debt servicing costs and costs of the objection process will cumulatively add around 8.5 percent to the average rates bill of Auckland households by 2021/22. Rate rises of this magnitude will increase the likelihood that some of planned investment will not go ahead. In other words the changes proposed could result in a substantial subsidisation of new ratepayers by existing ratepayers and may undermine the liveability of new communities by potentially denying them ready access to local infrastructure such as libraries, swimming pools and sports facilities.

12. It is crucial that the Bill recognise that these community assets are not “nice to haves” – they are integral to the success of new communities and the well-being of their residents. As such Auckland Council seeks the broadening of the proposed definition of community infrastructure to include libraries, swimming pools and sports infrastructure and other public amenities.

13. If the definition of community infrastructure remains as proposed in the Bill then Auckland Council would also seek the insertion of transition clauses in the Bill. These clauses would ensure that development contribution revenue planned to be collected for community infrastructure already built (or partially built) is continued, even if the infrastructure concerned no longer fits the definition proposed in the Bill.

PART ONE: LOCAL BOARDS, PLANNING & CONSULTATION, AND OTHER MATTERS

LOCAL BOARDS
	14. In general the local board model has worked well in Auckland. Local boards provide a crucial link between the council and local communities, and Auckland Council supports the roll out of this model to other parts of the country as part of reorganisation processes. While the provisions in the Bill in respect of the establishment of local boards closely resemble their equivalent provisions in the Local Government (Auckland Council) Act 2009 (LGACA), there are some key issues we would like to emphasise and a number of relatively minor discrepancies between the two that, if left unaddressed, will result in two types of local board processes across New Zealand.
Discrepancies between the Bill and LGACA, & other drafting issues in respect of local board provisions	15. New sub-part 1A of Part 4 of the Act (clause 15 of the Bill) provides for the establishment of local boards outside of Auckland as part of a reorganisation process. 16. The Auckland Council, established under the Local Government (Auckland Council) Act 2009 (LGACA), is explicitly excluded from new sub-part 1A. However, it is less clear as to whether these provisions would apply in the event of a future reorganisation proposal for all or part of Auckland Council. It would be useful to clarify this point during the select committee process. 17. Sub-part 1A closely mirrors those provisions in the LGACA which established local boards in Auckland. There are, however, several small differences between the two. One of these differences pertains to the legal standing of local boards. The Bill expressly states that local boards do not have separate legal standing to the council, whereas LGACA makes no mention of this. Auckland Council suggests that LGACA be amended to ensure consistency with the Bill in this regard. 18. The Bill (new section 48N) does not require local boards to use the special consultative procedure when adopting their triennial local board plans. However, there is no proposal to remove the existing requirement in the LGACA (section 20) for local boards in Auckland to use the SCP. Auckland Council is comfortable with this. Local board plans are the platform for inputting into the LTP and prioritising each local board’s 10 year budget. On that basis local board plans are similar in nature to the LTP and should follow the same consultation process. 19. LGACA section 23(2) and (3) sets out Auckland Council’s obligations to include in its annual report audited statements relating to the levels of service of each local board. The Bill sets out these same obligations for all councils with local boards (including Auckland) in the proposed schedule 10, section 34A. This amounts to a duplication for Auckland. Consequently we suggest that the relevant sections of LGACA be removed.
Membership of more than one local board	20. The LGACA does not prevent candidates standing for, and being elected to, more than one local board. During the 2010-13 term three candidates were elected to more than one local board, this increased to five members after the 2013 elections. 21. Membership of more than one board has the potential to create the perception of conflicts of interest as local boards are required to represent local interests in their area. Experience has shown that board members have heavy workloads, particularly the full time chairperson role. It is currently possible for a successful candidate to chair one local board and sit as a member of another. Membership of multiple boards potentially reduces the ability of the person concerned to effectively represent the views and preferences of their different local communities. 22. Auckland Council suggests that elected members should be able to sit on one local board only and that the Bill and the LGACA should be amended to reflect this. For Auckland this would take effect from the 2016 local elections. Candidates would still be able to stand for several boards but would have to choose which board to sit on if they were elected to more than one.
Councillors sitting on local boards	23. The Bill will enable the appointment of governing body members to a local board. The roles of the governing body and local boards are distinct, with the former focussing on “bigger picture” regional issues and the latter focusing on localised issues in their communities. The proposal to enable governing body members to sit on local boards would potentially blur this distinction and as such Auckland Council does not support it.
PLANNING AND CONSULTING PRACTICES
Special consultative procedure	24. Auckland Council supports the government’s intention to give territorial authorities more flexibility to determine how to consult with their communities by reducing the number of situations in which use of the Special Consultative Procedure (SCP) is mandatory and through the amendments to the SCP itself. 25. Accordingly the council supports the proposed changes to sections 82 and 83 of the Act. In particular Auckland Council supports: · the focus on interaction between the public and council representatives; · the use of technology (although we suggest that the reference to audio-visual links in new section 83(2) is potentially unnecessarily prescriptive as it may preclude pre-recorded material from hearings and may not be sufficiently broad to include suitable technologies that are not yet readily available – the phrase “digital channels” may overcome these issues); · the fact that information can be made publicly available in a number of ways; · the use of the term “views” rather than “submissions” as this will reduce any unnecessary formality, and generally reflects the wider engagement approach of the Bill; · the requirement that councils provide access to decisions to those who have participated in consultation processes, rather than tailored packages of information as per the current requirement.
Use of the SCP in other Acts	26. Auckland Council notes, however, that other Acts will continue to require the mandatory use of the section 83 SCP in certain instances. For purposes of consistency we suggest that the government consider amending these Acts to replace mandatory use of the SCP with the requirement to use processes that meet the principles of consultation as set out in section 82 and new section 82A. Examples of other Acts requiring use of the SCP include: · Gambling Act 2003 – when adopting and reviewing a class IV venues policy (section 102); · Dog Control Act 1996 – when adopting and amending a policy on dogs (section 10); and · Local Government (Auckland Transitional Provisions) Act 2010 – when confirming, amending or revoking a bylaw of a “legacy” council (section 63(4)).
Use of technology in council meetings	27. Schedule 4 of the Bill amends schedule 7 of the Act and allows for members of a local authority or any other person to be present at, or participate in, council meetings by way of audio or audio visual link. 28. Although there will be some cost involved Auckland Council supports this proposal. The council also supports the physical quorum requirement. However, certain circumstances will demand that the need for a physically present quorum be relaxed (e.g. emergencies or urgent decisions). Auckland Council suggests that this matter is be permitted to be addressed by council standing orders rather than legislation. As such we suggest that the proposed section 25A(3) of new schedule 7 be amended to allow local authorities to set out in their standing orders the circumstances under which the need for a physical quorum can be relaxed.
LTP & annual plan consultation processes	29. The Bill proposes to significantly amend the consultation processes for both the long term plan (LTP) and the annual plan. 30. New sections 93A to 93G (clause 29 of the Bill) set out the requirements for the new consultation document that all councils must produce when consulting on their LTPs. Auckland Council supports these proposals and suggests that they will aid the public’s understanding of the LTP and better enable councils to adopt innovative approaches to communicating their key areas of focus. 31. Similarly, Auckland Council also supports the proposals in relation to annual plan consultation. The limited focus of consultation (on significant differences between the annual and long term plans), the introduction of the consultation document, and the removal of the mandatory requirement to use the SCP, should result in more cost effective and timely decision making processes whilst enhancing the quality of public engagement.
Significance & engagement policy	32. Clause 18 of the Bill requires councils to develop a significance and engagement policy. This seems a sensible proposal in terms of helping provide structure for council consultation mechanisms given the greater flexibility other aspects of the Bill will provide. 33. Auckland Council suggests, however, that the transitional arrangements for the adoption of the significance and engagement policy be amended. New schedule 1AA (section 3) requires the policy to be adopted by 1 December 2014. We suggest that this date be changed to no later than 30 June 2015 in recognition of the work required to get the policy ready and to ensure that its timeline matches that of the LTP.
Infrastructure strategy	34. Clause 34 of the Bill establishes the requirement for local authorities to prepare and adopt an infrastructure strategy for a period of at least 30 years. 35. The council supports the requirement to produce a long term infrastructure strategy as it offers considerable potential to help co-ordinate investment decisions across agencies and over a long period of time, and thereby more effectively deliver the Auckland Plan. The infrastructure strategy will also enhance the public’s ability to understand the long term infrastructure issues facing their communities and could help improve the quality of public debate on these issues.
MISCELLANEOUS PROVISIONS & MATTERS NOT COVERED IN THE BILL
Infringement notices not addressed in the Bill	36. The local government sector has long advocated that, following appropriate community consultation, local authorities be empowered to specify bylaw breaches that would be subject to an infringement notice. Auckland Council supports this view and has submitted previously on the matter. It is disappointing to note, therefore, that this Bill fails to address the issue and as such the council requests that it be amended accordingly. 37. Infringement notices provide an immediate, cost effective and appropriately scaled enforcement mechanism to breaches of local government bylaws. Including provision for the increased use of infringement notices in the Bill would enable much more effective enforcement of bylaws in relation to issues such as graffiti, illegal street trading and car window washing. Where infringement notices are not available the enforcement of bylaws relies on tools that are often time and resource intensive (prosecution) or do little to act as a deterrent (e.g. seizure of the mops and buckets of car window washers). 38. Currently, infringement notices are available for use in relation to regulations made under a number of statutes such as the Resource Management Act 1991, the Building Act 2004 and the Land Transport Act 1998. However, the majority of local authority bylaws are made under the auspices of the LGA, which does not allow for the use of infringement notices unless explicitly established by the Minister. Efforts to have infringement notices established in this way have largely failed to date, which further increases the need for this matter to be addressed via an amendment to the Act.
New section 17 – review of services	39. New section 17A of the Bill introduces a requirement that as soon as practicable following local body elections councils must review the cost effectiveness of current arrangements for meeting the needs of their communities for good quality local infrastructure, local public services and performance of regulatory functions. 40. The cabinet paper that foreshadowed this Bill signalled that the policy intent in introducing this change was to provide for greater transparency, clarity and accountability in contracting for the delivery of services by CCOs, and was linked to the desire that councils plan effectively for future infrastructure needs. However, the Bill appears to call for a much wider ranging review than envisaged in the cabinet paper, covering all of a council’s arrangements for local infrastructure, local public services and performance of regulatory functions (although we note the section heading refers only to services). The proposed three yearly cycle of the review is also very short and has the potential to create unnecessary disruption within council and uncertainty for providers. 41. Whilst supporting the general principle that councils need to review their service provision arrangements on a periodic basis, Auckland Council suggests the workability of section 17A could be improved by: · providing councils with greater discretion for timing (perhaps with a requirement that the review must be undertaken at least every six years); and · confirming the intended scope of the review - we suggest that only public facing services, infrastructure and regulatory functions that are deemed significant be part of the review. 42. A further query arises in relation to the drafting of the first part of section 17A(3). Line 26 refers to “[an entity] responsible for funding or governance,” whereas line 27 refers only to “[an entity] responsible for governance.” It is not clear if the entity responsible for funding is subject to the obligations that follow (i.e. sub-clauses (a) to (g)).
Legal challenge to the mana whenua selection body (for membership of the IMSB)	43. Schedule 2 of LGACA sets out provisions in relation to the Independent Maori Statutory Board. It does not contemplate the potential for (or costs of) legal challenge to the selection process or to decisions of the selection body, or legal challenges filed against selection body members. Auckland Council suggests that it would be useful to clarify these matters, including the possibility of establishing a comprehensive disputes resolution process. The current Bill provides an opportunity to do this.
Reinstatement of transport as a governing body responsibility	44. Auckland Council supports the proposed amendment to LGACA section 15 which would reinstate governing body responsibility for Auckland Council decision making in relation to transport networks and infrastructure (schedule 9 of the Bill).
Definition of working day	45. The Bill uses the default definition of “working day” from the LGA to set deadlines for matters such as lodging a development contribution objection (schedule 13, clause 1) or responding to a reconsideration request (new section 199B). The LGA “working day” definition means that 24 December or 3 January could be a working day, for the purposes of the Act. By comparison, other Acts have a broader definition of “working day” (the Local Government Official Information and Meetings Act, and the Resource Management Act for example). Auckland Council suggests that for the development contribution objection procedure, a broader definition of “working day” should be considered, to ensure that the members of the public and councils are not pushed to meet statutory timeframes over traditional “holiday” periods.

PART TWO - DEVELOPMENT CONTRIBUTIONS

Executive Summary

Introduction

Auckland Council supports a number of the proposals in regard to development contributions in the Bill, specifically the following changes:

· introduction of new purpose and principles

· improving policy transparency

· development agreements

· reconsideration process

· technical updates.

Development contributions provide capital to fund investment in infrastructure to serve the needs of a growing population. As a result the council, hence existing ratepayers, don’t have to fund the interest costs of borrowing. The other operating costs (including depreciation) associated with the investments are met by all ratepayers, new and existing. This is fair as new residents are imposing additional asset capacity requirements on our infrastructure.

The changes proposed to community infrastructure and the objections process if adopted in their current form leave Auckland Council two options left either:

i) have inadequate infrastructure; or

ii) borrow for its construction and fund this from existing ratepayers.

The second option would mean additional cost to ratepayers over ten years of $480 million (increasing our debt by this amount) requiring an additional increase in rates of 8.5%^{^[1]} by 2021/2022.

These proposed changes will require territorial authorities to adopt a more rigid planning structure. This does not align with other pieces of legislation focused on increasing housing provision for Auckland which requires flexibility in infrastructure planning.

The council’s concerns are further addressed in the body of this submission and in Appendix three which contains clause by clause comments and drafting suggestions.

Background

Auckland Council was established with a mandate to promote integrated decision making in New Zealand’s biggest city. Auckland Council plans to collect $2.1 billion in development contributions over the next ten years. This will provide for the capital investment required to fund 58 per cent of New Zealand’s population growth.

Auckland Council’s development contributions policy provides a standardised approach across the region. This policy addresses the concerns at the heart of the reforms the government is proposing and was formed after extensive consultation with developers and the community.

New definition of community infrastructure

Auckland Council considers that the costs of growth should be met by new ratepayers through development contributions. This is economically efficient as those causing the additional costs, and receiving the benefits of the investments proportionately fund the expenditure.

Auckland Council seeks the retention of the ability to use development contributions to fund libraries, swimming pools, sports infrastructure and other public amenities. These should be included in the definition of community infrastructure. Auckland Council plans to invest $480 million in these facilities over the next ten years to support growth. Without development contributions funding this infrastructure may not be built or rates will have to rise by 8.5%.

Purpose and principles and objections process

Auckland Council considers that the share of the cost of growth to be paid by new ratepayers, through development contributions, should be calculated in a way that provides:

· certainty of cost to developers

· certainty of revenue to the council

· lowest possible administrative cost.

Establishing development contributions for types of development (e.g. residential, apartments, commercial and retail) and geographical areas provides more certainty for both parties. It can also be done at lower cost than calculating it for each individual development.

Purpose and principles

To allow the council to continue to perform an individual assessment based on the category and geographic area for each development the following new principle is proposed:

“for the purpose of calculating and charging development contributions, certain developments may be grouped together by geographic areas and/or categories of land use in a manner that balances practical and administrative efficiencies with fairness and equity considerations.”

This eliminates uncertainty and complexity for developers and the council of calculating the impact of each development on infrastructure on an individual basis.

Schedule 13 already allows for a degree of ‘averaging’ to be incorporated in the methodology used to calculate development contributions, the addition of this principle clarifies this position. This will also enable the council to retain a level of flexibility in planning infrastructure in response to accommodating growth.

Objections process

Auckland Council’s view is that the objection process should be framed in the context of the calculation of development contributions on the basis of types of development and geographical areas. This is consistent with the principle proposed above. The objection process should be amended to allow a council to choose to either:

· have their policy reviewed by independent commissioners before adoption and remove the ability for objections on basis of individual development characteristics but retaining the ability for an objection on incorrect application of the policy; or

· allow for objections subsequent to adoption with an amendment to the basis for objections requiring these to be considered on the basis of the new principles, including our proposed addition.

The proposed objection process is likely to cost Auckland Council $1,000,000 in additional staff, legal other expert resource and a potential reduction of development contributions revenue of $3 to $4 million per annum. This is an additional cost of around $40 million over ten years.

The proposed grounds for review focus on the individual characteristics of a development in isolation. The objection process as proposed fails to recognise that for a development contributions policy to remain workable there is a need for individual developments to be grouped together. This ‘averaging’ is fundamental to the operation of development contributions because:

· every development will have unique infrastructure characteristics

· there are significant administrative efficiencies when averaging across similar developers rather than trying to assess each development individually

· individual assessments create uncertainty for developers and the council.

The result of the current proposal will be that developments with below average infrastructure requirements will object. Developments with above average infrastructure requirements cannot be charged more to offset this.

In infrastructure terms, growth has a much wider impact on public infrastructure than just the ‘local’ effects of a development. The objection process fails to recognise cumulative effects which are fundamental to the operation of development contributions policies. Often one development on its own does not trigger the need for specific infrastructure projects but that development, along with a number of other developments, contributes toward the cumulative need for these projects.

Commencement dates

Should the main features of the legislation be enacted the council proposes that some changes be made to the commencement dates. Some of the proposed changes can be implemented at short notice such as:

· introduction of a reconsideration process

· no longer funding reserves from non-residential development.

However, some will require more time. More time will enable the council to:

· incorporate any financial impacts in its planning and integrate this into the development of the Long-term Plan 2015-2025

· make changes to its systems and processes

· communicate the new policy to developers.

Accordingly it is proposed that the legislation be amended as follows

· 1 July 2015 commencement date for any changes to the definition of community infrastructure and the objection process.

If the government’s proposals are implemented it will impact Auckland ratepayers by $48 million in the 2014/2015 year. The council will not have time to incorporate this into the Annual Plan 2014/2015.

Background

Auckland Context

(2)

(3) Auckland Council was created in November 2010 to replace the seven former territorial local authorities and the regional council. Prior to amalgamation the councils operated several different growth funding approaches, including those who used:

a) only development contributions under the LGA 2002

b) only financial contributions under the RMA 1991

c) mixed financial contributions under the RMA 1991 and development contributions under the LGA 2002

d) mixed development contributions under the LGA 1974 and LGA 2002.

(4)

(5) Each of these approaches applied only to the area of the former council. This indicates on a local scale the extent of variation faced by the development sector in Auckland at the time and also the history of policy development and challenges.

(6)

(7) Since amalgamation the Council has adopted an integrated policy (2012 policy) that applies consistently to the whole of Auckland. It is deliberately more straightforward in its content and application. This policy is more accessible to those working in the profession and to those one-off developments where Aucklanders look to subdivide or add units to their primary residence. An online tool allows developers to estimate their likely contribution charge.

(8)

(9) Auckland Council is looking to recover $2.1bn of the capital cost of growth investment from its contributions policy over the next 10 years. This will be recovered from the additional 100,000 residential homes and 5,000,000 square metres of non-residential development that is anticipated to be coming to Auckland in that time. The 30 year growth outlook is even more significant and is akin to the city of Christchurch in 2004 coming to live and work in Auckland.

(10)

(11) Auckland Council adopted a collaborative approach to developing the 2012 policy based on:

a) formulation of the single vision for Auckland – now reflected in the Auckland Plan

b) extent of growth anticipated to occur in Auckland over the next 30 years

c) fundamental shift in the types of accommodation necessary to enable the growth anticipated

d) cost of public infrastructure to meet the needs of this growth.

(12)

(13) Future changes to the 2012 policy will be undertaken in collaboration with stakeholders so that experience on both sides can be brought to bear on the issues that remain. This will ensure any added complexity is understood and accepted by all and is focussed on addressing common problems.

(14)

Most of the issues Auckland Council had identified as needing change to improve the existing legislation have been addressed in the Bill. Auckland Council supports the following proposals contained in the Bill, in particular:

· new purpose and principles

· improving policy transparency

· development agreements

· reconsideration process

· technical updates.

(15)

Key Issues

Auckland Council is expecting substantial population growth and is planning major investments in infrastructure to support this. Our current LTP projects that in ten years the Auckland region will have:

· approximately 270,000 new residents which is 58% of New Zealand’s population growth

· a planned spend of $2.1bn growth capital expenditure 2012-2022 LTP funded by development contributions which is 45% of the country’s local growth capital expenditure (DIA Discussion document)

Auckland’s capital investment needs are likely to increase following the review of our current plans and the development of the LTP 2015/2025. This will be driven by the burgeoning economic recovery, the Housing Accord and Special Housing Area Bill and their focus on the housing needs of Auckland.

The council considers that the changes proposed to development contributions pose material risks for our current funding arrangements and plans for growth. The changes will have a significant effect on Auckland Council’s:

· debt levels – and hence our overall financial strategy

· ability to provide infrastructure assets to service growth

· levels of increases to rates to service infrastructure investment.

The council’s concerns relate to the interaction between the proposals and our underlying position that:

· new ratepayers (through development contributions) should pay for the capital costs of putting in place infrastructure to service them, not existing ratepayers

· new ratepayers (through development contributions) should pay the costs of growth in a way that delivers certainty for them and council and is calculated at minimum cost for both parties.

New ratepayers are the driver for the investments made in growth related projects by the council, or in the share of other projects needed to serve growth. They are also the beneficiaries of the services provided by this infrastructure. It is considered fair that they meet the capital costs and that they take them into account in their decision making on development projects. Both new and existing ratepayers will share the ongoing costs of operation and eventually replacement.

New and existing ratepayers benefit from a system of calculating development contributions that provide cost and revenue certainty at the lowest administrative cost whilst reflecting differences in underlying demand. This cannot be achieved by looking at the effects of each development in isolation. Such an approach is very time and cost intensive for both parties and does not take into account the cumulative impact of development. It will also lead to widely varying development contributions across the region and even to those in close proximity to each other. This was one of the major criticisms of the former council’s policies.

Development contributions need to have an element of averaging between types of development and within geographical areas. Schedule 13 already allows for a degree of ‘averaging’ to be incorporated in the methodology used to calculate development contributions. This enables the council to retain a level of flexibility in planning infrastructure in response to accommodating growth.

For the new legislation to fit the Auckland Council approach set out about above a number of key changes are required. These are discussed in the following section.

Absent these changes the proposal in its current form will:

· impose substantial additional costs on ratepayers raising rates from 2016/2017

· reduce revenue certainty for the council

· reduce cost certainty for developers

· lead to delays in development

· reduce transparency.

Cost Type	Cost	Cumulative Rates Impact
Community Infrastructure definition	$480 million	8%
Objection Process	$40 million	0.6%

Full discussion of the key issues is set out below. This is followed by Appendix three which sets out a clause by clause commentary on the bill identifying issues with which the council has concerns, the rationale and our proposed changes.

New Definition of Community Infrastructure

Auckland Council seeks a broadening of the definition of community infrastructure to include libraries, swimming pools, sports facilities and other public amenities. This approach would still specifically exclude a range of assets being funded from community infrastructure contributions such as: cemeteries, museums and art galleries.

The introduction of the other amendments contained in the bill places a higher level of accountability on the territorial authority. This could alleviate the need to narrow the definition of community infrastructure due to:

· a higher level of disclosure requirements with respect to infrastructure planned with growth in mind

· a greater degree of transparency on how the cost for planned infrastructure is shared between new and existing ratepayers.

Post Legislation Effect of proposed changes

Planned Expenditure:

Development Contribution Community Infrastructure

Cumulative Rates Increase

Total Community Infrastructure

Community Infrastructure that can continue to be funded by Development Contributions

Community Infrastructure that cannot continue to be funded by Development Contributions

Auckland Council

$412.8 Million

$19.4 Million

$393.4 Million

6.44%

Without development contributions to fund our planned investment in community infrastructure, the council would need additional increases to rates from 2016/2017. This does not assume the recovery of debt incurred to provide growth infrastructure, only the servicing of this debt. Current ratepayers will incur an additional burden to fund facilities for new residents along with paying for the services they presently receive. The alternative is for Auckland Council not to build this type of community infrastructure and remove it from the Long-Term Plan.

The provision of community infrastructure is integral to the success of new suburbs, and intensification, through the amenity it provides. This includes assets provided by councils such as libraries, swimming pools, sports facilities and community centres, as well as assets provided by central government like primary and secondary schools. The earlier this infrastructure is built the better from the perspective of developers and to enable a true ‘community’ to become established.

There is a real risk that Auckland Council will be unable to provide sufficient community infrastructure in growth areas if this reform is passed in its present form. Alternative funding sources are limited given pressures from the government and local communities to keep rates increases down and to reduce reliance on debt funding. Auckland Council considers this would not be in the long-term benefit of our communities.

A good example of this is the library in Flat Bush in Auckland. This facility is located in an area where large suburbs have been developed from what was previously rural land. This project is clearly related to growth because it would not have been built if these new suburbs had not been developed. Because the direct link to growth is clear it is the council’s view that development contributions should be able to be retained to enable projects like this to be funded by the community that will directly benefit from it.

Alternatives to development contributions such as targeted rates may only be applicable to geographically stand alone developments and cannot spread the charges evenly over time. Development contributions can apply to all developments and can spread the charges over time. A targeted rate would place too much of the burden on early developments.

The council notes that in England and Wales local councils have just been given more enabling powers to require development levies for these types of facilities^{^[2]}. In addition Auckland Council notes that the revised definition is inconsistent with the proposed purpose statement development contributions are “…to enable territorial authorities to recover from those persons undertaking development a fair, equitable and proportionate portion of the costs of capital expenditure necessary to service growth”. Fairness and equity applies equally to existing ratepayers and future ratepayers (growth). For those facilities excluded from the definition this test is not met.

Auckland Council understands that concerns have been raised by developers that some councils have not adequately taken into account the wider community benefits and use of these facilities in the allocation of costs between development contributions and other funding sources. Other changes proposed in the Bill should help alleviate this issue without the need for this change to the definition of community infrastructure such as the:

· new purpose and principles

· disclosure of the schedule of projects (including the cost allocation) to be funded by development contributions

· independent objection process.

Community infrastructure - transitional provisions

If the Bill is not amended as proposed above Auckland Council seeks the introduction of an additional clause to the transitional provisions to allow for the continued collection of development contributions for community infrastructure projects that have been completed or are currently under construction, even if these projects no longer comply with the new definition of community infrastructure.

(3) Territorial authorities may continue to require development contributions for projects completed, or substantially completed, before the enactment of the Local Government Act 2002 Amendment Act (No 3) 2013 until such time as the growth related capital expenditure for these projects that were being already being funded by development contributions has been fully recovered

Auckland Council has made significant investment in the last 10 years in community infrastructure on the basis that some of the cost will be recovered through future development contribution revenue. The amendment to the definition of community infrastructure in the Bill would mean that development contributions would no longer be able to be collected for these projects and therefore the existing debt for these projects (and the costs of servicing this debt) would have to be transferred to rate funding (or other funding sources) immediately.

Auckland Council understands that steps are normally taken to ensure that this type of retrospective application or effect of new legislation is avoided. It is a general principle that “new law should not affect existing rights” and that “some allowance can and should be made for parties that have relied on the earlier law”^{^[3]}. Councils have incurred growth related debt to build facilities, e.g. libraries, relying on the ability for this debt to be repaid through the future collection of development contributions.

“The general principle is that statutes and regulations operate prospectively, that is, they do not affect existing situations. This principle is set out in s.7 of the Interpretation Act 1999 which provides that enactments do not have retrospective effect.”^{^[4]}

Auckland Council’s investment decisions are likely to have been different if they had known at the earlier time that future development contribution funding for these projects could not be relied upon and was to be abolished in the near future.

Post Legislation Effect of proposed changes

Historic Expenditure:

Development Contribution Community Infrastructure

Cumulative Rates Increase

Total Community Infrastructure already spent

Community Infrastructure spend that can continue to be funded

Community Infrastructure spend that cannot continue to be funded

Auckland Council

$95.7 Million

$6.7 Million

$89 Million

1.43%

Purpose and principles

The council considers that in order to provide certainty of cost to developers and revenue to the council at lowest administration cost development contributions need to be calculated for types of developments and geographical areas. To allow for this an additional principle needs to be added to the legislation.

The council seeks that a principle along the following lines is added to the six other proposed principles in s197AB of the Bill:

The council considers that in order to provide certainty of cost to developers and revenue for the council at lowest administration cost development contributions need to be calculated for types of development and geographical areas. It is inefficient for the council and developers to undertake an impact assessment of effects on an individual development in isolation of other developments. It is also incorrect as this ignores the cumulative effects a development has on the wider network. To allow for this an additional principle needs to be added to the legislation.

Auckland Council is accepting of the new purpose and the other new principles that have been proposed subject to some minor refinements as suggested in Appendix three.

Independent Objections Process

Auckland Council seeks amendment to the proposed independent objections process to align it with our proposals for the purpose and principles. The basis for objections should be consistent with the assessment of contributions on the basis of types of development and geographical location.

The proposed objections process is focused on reviewing assessments based on the individual effects of a development in isolation. Auckland Council currently performs 14,000 development contribution assessments per annum. Application of this approach to our current policy as discussed in detail below would lead to a loss of revenue of between $3 to $4 million p.a. and additional administrative costs of $1,000,000 p.a. for staff and legal resource to support the council’s representation in the objections process. Details of this analysis are summarised in Appendix four.

To minimise the under-collection of development contributions, Auckland Council would need to amend its development contribution charges. The only way to do this is for existing catchments to be broken up into multiple smaller catchments and the different types of development to be broken up into numerous types of development. For example the category of non-residential development may be broken into office, retail, medical, petrol stations, restaurants, cafes, fast food outlets etc. As a result, development contributions policies will become much more complex and development contribution charges for some types of development will increase causing concern and frustration for developers. This will be administratively costly for both developers and the council as noted above and will increase uncertainty.

If the Select Committee felt that independent scrutiny of development contributions policies themselves was warranted, our preferred approach is for this to be done by a third party regulator (similar to the role the Commerce Commission performs in relation to monopoly businesses).

Councils could ‘opt in’ to having an independent review of the process of adopting their policy to ensure compliance of policy with legislation. This process would involve an opportunity for developers to raise concerns with a development contributions policy with the third party regulator. The council would be bound to implement the outcomes of the independent review. Subsequent, objections could only be made on the basis that the council had not correctly applied its policy.

For those councils which did not wish to undertake an ex-ante review objections could still be made. However, the grounds for an objection should be amended to reflect the averaging principle proposed by the council above.

In addition the council recommends that a decision making framework be established for commissioners requiring them to consider objections based on the principles in the legislation. At present the council must consider these in setting and applying its policy but the commissioners are not required to consider these in the process as proposed.

Analysis of objections process

The proposed grounds for review in the objections process are focused on the individual characteristics of a specific development. They fail to recognise that for a development contributions policy to remain workable there is a need for individual developments to be grouped together into different categories or types of land uses and different geographic parts of a district (catchments) that are logical, appropriate and manageable from a practical and administrative viewpoint, for the purpose of calculating and charging development contributions; i.e. a degree of ‘averaging’ is necessary. This ‘averaging’ is fundamental to the operation of development contributions because:

· it is impossible to foresee each development that will occur in a district, much less the exact infrastructure demands and needs that each development will have

· every development will have unique infrastructure characteristics, for example no two dwellings will have the exact same infrastructure characteristics in terms of car use and water demand etc, making the administrative burden of attempting individual assessments, without the principled basis recommended, prohibitively costly, unrealistic and unachievable

· there are significant administrative efficiencies when averaging across similar development types rather than trying to assess each development on its own. Requiring the specific identification and calculation of infrastructure requirements related to each development creates an economically inefficient outcome because of the uncertainty of outcome for each developer and because of the significant additional resourcing and information needs and costs that would be required to implement this approach.

It is an accepted practice by both the development community and councils to classify development by land use typology. Where significant differences in infrastructure requirements occur due to land use, then existing practice allows for the use of typology to create a price differential, e.g. lower charges for high rise apartments verses detached dwellings.

The use of catchments is an accepted practice by both the development community and councils. This supports the underlying principle of averaging inherent to development contributions. An example of averaging might be:

A new catchment being added to a development contributions policy covering the geographic extent of a new suburb that a council has zoned for development

· in that catchment five stormwater pipe networks might be required to service the whole area but each subdivision in the catchment is serviced by one stormwater pipe network

· for administrative simplicity a council will take a development contribution for the proportional share of each of the five stormwater pipe networks from all subdivisions and other developments in the catchment instead of requiring a development contribution only for a single stormwater pipe network that services each subdivision

· it appears that under the proposed objections process a developer could successfully argue against paying a contribution toward any of the four networks that do not service its development but are within the wider development contributions catchment.

The LGA 2002 as it currently stands supports the concept of ‘averaging’ as a practical necessity within a development contributions policy. For example, it:

· requires development contributions to be set at an activity level (e.g. roads, stormwater etc) rather than a project level

· allows development contributions to be set at a catchment level or even at a whole of district level rather than a development by development approach

· requires development contributions to be determined by dividing total costs by the total number of units of growth (e.g. new sections or houses) in a manner that each unit of growth is treated equally and is attributed the same cost

This will preserve the council’s ability to retain a level of flexibility in planning infrastructure in response to accommodating growth.

In addition the objection process fails to recognise cumulative effects which are fundamental to the operation of development contributions policies. Often one development on its own does not trigger the need for specific infrastructure projects but that development, along with a number of other developments, contributes toward the cumulative need for these projects.

The importance of cumulative effects is recognised elsewhere in the LGA 2002 and in the Amendment Bill specifically in regards to development contributions. For example, section 199(3) of the LGA 2002 and in the proposed new development contributions principles (Principle A).

In infrastructure terms, growth has a much wider impact on public infrastructure than just the ‘local’ effects of a development. The lack of recognition of cumulative effects in the objections provisions raises the risk that these matters are not considered to be relevant in the objections process and that developers will be successful with arguments. For example, a particular development can be completed in isolation without the need for infrastructure projects ‘X’ and ‘Y’, the developer of that development should not have to pay contributions toward these projects. This does not take into account the cumulative effects of that development in combination with other development which means that a council needs to build projects ‘X’ and ‘Y’ in the future, which justifies a development contribution being required as a proportional share toward these project costs.

Development contributions charges cannot be set in a way that allows for both the individual assessment of the specific infrastructure requirements of each development and the full recovery of costs allocated to development contribution funding. This reality is at odds with the proposed objection process which allows for developers to essentially ‘opt in’ to an individual assessment for their development through the objections process without any reference or regard to the broader considerations such as the ‘averaging’ or ‘grouping’ required within development contributions policies, or the consideration of cumulative effects.

The result of the current proposal will be that developments with below average infrastructure requirements will seek objections and most likely be successful. Developments with above average infrastructure requirements cannot be charged more to offset this. Even if this were possible the administrative burden would render it impractical.

As a result some ‘genuine’ growth-related costs budgeted to be funded by development contributions will have to be transferred to ratepayers. This could well be a significant portion of these growth-related costs, summing to between $3 and $4 million per annum.

Commencement dates

Auckland Council can implement the following changes from 1 July 2014:

· introduction of a reconsideration process

· no longer funding reserves from non-residential development

However, implementing some amendments will require more time. The current commencement provisions require the development contributions policy to be reviewed and re-adopted. The council will not have time to properly amend its policy by 1 July 2014. Any changes will have to be rushed to meet this deadline. There will not be time to adequately:

· incorporate any financial impacts in its planning and integrate this into the development of the Annual plan 2014/2015

· make changes to its systems and processes

· communicate the new policy to developers.

The process will need to be substantially repeated during the process of development of the long-term plan 2015-2025 to reflect new capital expenditure plans. To amend an existing development contributions policy it is necessary to:

· prepare a new draft policy

· formally adopt a draft policy for consultation

· undertake consultation

· hear submissions

· undertake deliberations

· make any necessary changes to the policy

· formally adopt the final policy.

Accordingly the council proposes that the legislation be amended as follows

· 1 July 2015 commencement date for any changes to the definition of community infrastructure and the objection process.

Drafting issues

Auckland Council acknowledges that development contributions are complex and technical. This makes drafting of legislation difficult.

There are a number of areas in the Bill where we think the drafting could be significantly improved. Further drafting issues may also arise as amendments are made to the Bill as the result of the select committee process. If these drafting issues are not addressed they may seriously compromise the sensible and logical implementation of the development contributions provisions. As noted throughout this submission, Auckland Council is able to assist with resolving these issues and we have made a number of drafting suggestions which can be found in the Appendix three.

Auckland Council asks that each of these drafting suggestions is considered on its individual merits and that it is to be provided with a final opportunity to review the Bill at an appropriate point in time following the select committee process to identify any remaining significant drafting issues.

Appendices

Appendix one: Clause by clause drafting suggestions with supporting rationale (Development Contributions)

Appendix two: Development contribution impact analysis

Appendix three: Local Board views

APPENDIX ONE: Clause by clause drafting suggestions with supporting rationale (development contributions)

Auckland Council respectively makes the following suggested changes to the LGA 2002 Amendment Bill and other sections of the LGA 2002 that are not addressed by the Bill, in relation to development contributions.

Regional Strategy and Policy Committee

04 February 2014

Amendment Bill Reference	Amendment	Proposed Amendments	Suggested Changes	Comments/Reasons
2	Commencement	(1) Sections 48 (so far as it relates to new section 197AB), 49(2), 50, 51, and 55 come into force 1 month after the date on which this Act receives the Royal assent. (2) Sections 53 (so far as it relates to new sections 199C to 199E and 199L to 199N and 70 and Schedule 7 come into force on the earlier of – a. a date appointed by the Governor-General by Order in Council: b. 12 months after the date on which this Act receives the Royal assent. (3) The rest of this Act comes into force on the day after the date on which it receives the Royal assent.	(1) Sections 49 (so far as it relates to the definition of community infrastructure), 51, 53 (so far as it relates to new sections 199C to 199E and 199L to 199N) , 55, 70 and Schedule 7 come into force on 1 July 2015. (2) Despite subsection (1), a territorial authority must not require a development contribution that is inconsistent with section 51 from the day after the date on which this Act receives Royal assent. (3) A territorial authority must accept and process applications for the reconsideration of a development contributions required in accordance with section 53 (as far as it relates to new sections 199A and 199B) from the day after the date on which this Act receives Royal assent as if these provisions had been incorporated into the development contributions policy in accordance with section 57. (4) The rest of this Act comes into force on the day after the date on which it receives the Royal assent.	The removal of reserves from non-residential development and the reconsideration process would have immediate effect as would the new purpose and principles. Changes to community infrastructure and the new objections process would be delayed until 1 July 2015 which aligns with the LTP cycle. This allows adequate time for councils to review their capital programmes including public consultation in regards to community infrastructure that can no longer be funded by development contributions It is important that development contributions policies do not have to be reviewed prior to the 2015-2025 LTPs because there is a statutory requirement for the policies to be reviewed at least every 3 years. If this misalignment was created policies would have to be reviewed almost immediately or prior to all future LTP cycles.
	S106 Policy on development contributions or financial contributions	(2) A policy adopted under section 102(1) must, in relation to the purposes for which development contributions or financial contributions may be required,— a) summarise and explain the capital expenditure identified in the long-term … plan that the local authority expects to incur to meet the increased demand for community facilities resulting from growth; and b) state the proportion of that capital expenditure that will be funded by— i. development contributions: ii. financial contributions: iii. other sources of funding; and c) explain, in terms of the matters required to be considered under section 101(3), why the local authority has determined to use these funding sources to meet the expected capital expenditure referred to in paragraph (a); and d) identify separately each activity or group of activities for which a development contribution or a financial contribution will be required and, in relation to each activity or group of activities, specify the total amount of funding to be sought by development contributions or financial contributions; and e) if development contributions will be required, comply with the requirements set out in sections 201 and 202; and f) if financial contributions will be required, summarise the provisions that relate to financial contributions in the district plan or regional plan prepared under the Resource Management Act 1991.	(2) A policy adopted under section 102(1) must, in relation to the purposes for which development contributions or financial contributions may be required,— a) summarise and explain the total cost of capital expenditure ~~identified in the long-term plan~~ that the local authority expects to incur to meet the increased demand for community facilities resulting from growth; and b) state the proportion of that total cost of capital expenditure that will be funded by— i. development contributions: ii. financial contributions: iii. other sources of funding; and c) explain, in terms of the matters required to be considered under section 101(3), why the local authority has determined to use these funding sources to meet the expected total cost of capital expenditure referred to in paragraph (a); and d) identify separately each activity or group of activities for which a development contribution or a financial contribution will be required and, in relation to each activity or group of activities, specify the total amount of funding to be sought by development contributions or financial contributions; and e) if development contributions will be required, comply with the requirements set out in sections 201 and 202; and f) if financial contributions will be required, summarise the provisions that relate to financial contributions in the district plan or regional plan prepared under the Resource Management Act 1991.	Inclusion of ‘total cost of’ provides for consistency with other sections of the Act, for example Schedule 13. Remove ‘identified in the long term plan’ Infrastructure incurred in anticipation of development may have occurred prior to the period covered by the long term plan. Infrastructure intended to be incurred beyond the period covered by the long term plan will be allowed to be included in development contributions in accordance with changes made by this bill. As currently worded s106(2)(a) requires both sets of infrastructure set out above to be included in the long term plan even though they do not relate to the long term plan period if development contributions are going to be required to fund them. Development contributions assets or groups of assets can utilise development contribution funding can be amended without consultation in section 201. Therefore these assets will not have been identified in the long term plan.
36	S106 Policy on development contributions or financial contributions	(2A) (b) development contribution charges per unit of development do not exceed the maximum amount allowed by section 203.	(2) (b) development contribution ~~charges~~ per unit of ~~development~~ demand do not exceed the maximum amount allowed by section 203.	These amendments would provide consistency within the development contribution provisions of the Act and reduce uncertainty associated with interpretation. Remove the word ‘charges’ and replace ‘unit of development’ with ‘unit of demand’. The current terminology is not used in the Act. Unit of demand is currently used in Section 203(2) and Schedule 13.
36	S106 Policy on development contributions or financial contributions	(2B) Development contribution charges for a particular asset or group of assets in a territorial authority’s district, or part of a district, may be increased annually, by the authority of this subsection, in accordance with the increases (if any) in the Producers Price Index Outputs for Construction provided by Statistics New Zealand for the previous year.	(2B) Development contribution ~~charges~~ for a particular ~~asset~~ activity or group of ~~assets~~ activities in a territorial authority’s district, or part of a district, may be increased annually, by the authority of this subsection, ~~in accordance with~~ to a maximum of the increases (if any) in the Producers Price Index Outputs for Construction provided by Statistics New Zealand ~~for the previous year~~.	Support the discretionary nature of the PPI increases. Change the term assets or group of assets to activity or group of activities as development contributions are charged at the activity level.
45	S150A Costs of development contributions objections			Support this addition
48	S197AA Purpose of development contributions	The purpose of the development contributions provisions in this Act is to enable territorial authorities to recover from those persons undertaking development a fair, equitable and proportionate portion of the cost of capital expenditure necessary to service growth	The purpose of the development contributions provisions in this Act is to enable territorial authorities to recover from those persons undertaking development a fair, equitable and proportionate portion of the total cost of capital expenditure necessary to service growth
48	197AB Development contributions principles	A territorial authority must take into account the following principles when preparing a development contributions policy under section 106 or requiring development contributions under section 198: a) development contributions should only be required if developments create or cumulatively have created a requirement for the territorial authority to provide new or additional assets or assets of increased capacity: b) development contributions should be determined in a manner that is consistent with the capacity life of the assets for which they are intended to be used and in a way that avoids over-recovery of costs allocated to development contribution funding: c) cost allocations used to establish development contributions should be determined according to, and be proportional to, the persons who will benefit from the assets to be provided as well as those who create the need for those assets: d) development contributions must be used – i. for or towards the purpose of the activity or the groups of activities for which the contributions were required; and ii. in the district or the part of the district in which the development contributions were required: e) territorial authorities should make sufficient information available to demonstrate what development contributions are being used for and why they are being used: f) development contributions should be predictable and be consistent with the methodology and schedules of the territorial authority’s development contribution policy under section 106,201, and 202.	All persons exercising the functions of this subpart ~~A territorial authority~~ must take into account the following principles when preparing a development contributions policy under section 106 or requiring development contributions under section 198: a) development contributions should only be required if the effect or cumulative effect of developments create or ~~developments create or cumulatively~~ have created a requirement for the territorial authority to provide new or additional assets or assets of increased capacity; including assets identified in S199(2): b) development contributions should be determined in a manner that is broadly consistent with the capacity life of the assets for which they are intended to be used and in a way that avoids over-recovery of costs allocated to development contribution funding: c) cost allocations used to establish development contributions should be determined according to, and be proportional to, the persons who will benefit from the assets to be provided as well as those who create the need for those assets: d) development contributions must be used – i. for or towards the purpose of the activity or the groups of activities for which the contributions were required; and ii. for in the district or the part of the district in which the development contributions were required: e) territorial authorities should make sufficient information available to demonstrate what development contributions are being used for and why they are being used: f) development contributions should be predictable and be consistent with the methodology and schedules of the territorial authority’s development contribution policy under section 106,201, and 202. g) for the purpose of calculating and charging development contributions, certain developments may be grouped together by geographic areas and/or categories of land use in a manner that balances practical and administrative efficiencies with fairness and equity considerations	Other considerations such as 101(3) needs to be taken into account a) Capital expenditure already incurred in anticipation of development as provided for in S199(2) of the Act. b) to provide some discretion to allow for things like: · Assets to be grouped together into a programme of works with one capacity life rather than the capacity life of each asset having to be considered · the potential for interests costs on lead infrastructure getting out of hand for projects with very long capacity lives making it more sensible and less costly for a shortened capacity life to be adopted d) (i)remove the s from groups to be consistent with the use of the term elsewhere for example S106(2)(d) of the Act. Change d) (ii) change ‘in’ to ‘for’ because the assets that service a particular part of a district is often located outside the geographical boundaries of a catchment. New principle g) to shows the underlying averaging that occurs in the development contributions regime. Individual site by site calculations were part of the previous financial contribution regime. The inclusion of fair and equitable limits council's ability to charge very large contributions on a development that generates very little demand.
49	197 Interpretation	(1) … development means – (a) any subdivision, building (as defined in section 8 of the Building Act 2004), use, or work (2) … accommodation units means units, apartments, or rooms in 1 or more buildings for the purpose of providing overnight, temporary, or rental accommodation community infrastructure means the following assets when owned, operated, or controlled by a territorial authority: (a) Community centres or halls for the use of a local community or neighbourhood, and the land on which they are or will be situated: (b) Play equipment that is located on a neighbourhood reserve: (c) Toilets for the use by the public Development agreement means a voluntary contractual agreement made under sections 207A to 207F between 1 or more developers and 1 or more territorial authorities for the provision, supply, or exchange of infrastructure, land, or money to provide network infrastructure, community infrastructure, or reserves in 1 or more districts or a part of a district development contributions commissioner means a person appointed under section 199F development contribution objection means an objection lodged under clause 1 of Schedule 13A against a requirement to pay a development contribution objector means a developer who lodges a development contribution objection	(1) … development means – (a) any subdivision, building (as defined in section 8 of the Building Act 2004), land use activity, or work (2) … community infrastructure means the following assets when owned, operated, or controlled by a territorial authority: (a) Community centres or halls for the use of a local community or neighbourhood, and the land on which they are or will be situated: (b) Play equipment, public toilets and other public amenities that isare located on ~~a neighbourhood~~ reserves: (c) Libraries and swimming pools for the use of a local community or neighbourhood (d) sports related infrastructure that is located on reserves ~~(e)~~ ~~Toilets for the use by the public~~	Development: adding land and activity provide more clarity in terms of what the word use means. Play equipment: is not always located on neighbourhood reserves, sometimes they are on esplanade or stormwater reserves, this provides cost savings. There is no definition of neighbourhood and this could be different across the region. Libraries and recreation centres are a core service TAs are to consider. The changes in schedule, purpose and principle would clearly establish that only growth would be paying for their impact on these types of infrastructure and the wider community would be funding their share. Support other new definitions
50	198 Power to require contributions for developments			Support the addition of certificate of acceptance.
48	198A Restrictions of power to require contributions for reserves	(1) Despite section 198(1),a territorial authority may not require a development contributions to be made to the territorial authority for the provision of any reserves - (a) if the development is non-residential in nature; or (b) for the non-residential component of a development that has both a residential component and a non-residential component. (2) For the purposes of subsection (1), visitor accommodation units are deemed to be residential.	(1) Despite section 198(1),a territorial authority may not require a development contributions to be made to the territorial authority for the provision of any reserves - (a) if the development is non-residential in nature; or (b) for the non-residential component of a development that has both a residential component and a non-residential component. (2) For the purposes of subsection (1), ~~visitor~~ accommodation units are deemed to be residential.	The removal of visitor in (2) is to align with definition in S197
52	199 Basis on which development contributions may be required	In section 199(2) replace “the development” with “development”. (3) In subsection (1), effect includes the cumulative effects that a development may have in combination with another development.	(3) In subsection (1), effect includes the cumulative effects that a development may have in combination with another developments.	Support the changes to (2) This removes two specific site effects comparisons. Rather it compares one site with multiple sites effects.
53	199A Right to reconsideration of requirement for development contribution	(1) If a person is required by a territorial authority to pay a development contribution under section 198, the person may request the territorial authority to reconsider the requirement if the person has reasonable grounds to believe that- (a) the development contribution was incorrectly calculated or assessed under the territorial authority’s development contributions policy ; or (b) the territorial authority incorrectly applied its development contribution policy; or (c) the information used to assess the person’s development against the development contributions policy, or the way the territorial authority has recorded or used it when requiring a development contribution, was incomplete or contained errors. (2) A request for reconsideration must be lodged and decided according to the procedure set out in a development contributions policy under section 202A(2). (3) A request for a reconsideration must be made within 10 working days after the date on which the person lodging the request receives notice from the territorial authority of the level of development contribution that the territorial authority is proposing to require. (4) A person may not apply for a reconsideration if the person has already lodged an objection under section 199C and Schedule 13A.	(1) If a person is required by a territorial authority to pay a development contribution under section 198, the person (or agent working on behalf of that person) may request the territorial authority to reconsider the requirement if the person has reasonable grounds to believe that- (a) the development contribution was incorrectly calculated or assessed under the territorial authority’s development contributions policy ; or (b) the territorial authority incorrectly applied its development contribution policy; or (c) the information used to assess the person’s development against the development contributions policy, or the way the territorial authority has recorded or used it when requiring a development contribution, was incomplete or contained errors. (2) A request for reconsideration must be lodged and decided according to the procedure set out in a development contributions policy under section 202A(2). (3) A request for a reconsideration must be made within 10 working days after the date on which the person lodging the request (or agent working on behalf of that person) receives notice from the territorial authority of the level of development contribution that the territorial authority is proposing to require. (4) A person may not apply for a reconsideration if the person (or agent working on behalf of that person) has already lodged an objection under section 199C and Schedule 13A.	Support the inclusion of this section. Applicants often use agents to act on their behalf rather than dealing with council directly. In these cases notice of a development contribution requirement is made to the agent rather than the consent applicant.
53	199B Territorial authority to notify outcome of reconsideration	(1)		Support this section
53	199C Right to object to requirement for development contribution	(1) A developer may, on any ground set out in section 199D, object to – (a) a notice given to the person by a territorial authority that specifies the assessed amount of the development contribution that the territorial authority proposes to require from the developer; or (b) if notice has not been given, the development contribution that the territorial authority requires from the person under section 198. (2) The right of objection conferred by subsection (1) applies irrespective of whether the person has previously requested a reconsideration of a requirement for a development contribution under section 199A. (3) The right of objection conferred by this section does not apply to challenges to the content of a development contributions policy prepared in accordance with section 102.	(1) A developer may, on any ground set out in section 199D, object to – a) a notice given to the person by a territorial authority when a development contribution is required under section 198 that specifies the assessed amount of the development contribution that the territorial authority ~~proposes to require~~ has required from the person; or b) the assessed amount if notice has not been given when a development contribution is required under section 198, the development contribution that the territorial authority subsequently requires ~~from~~ the person to make.~~under section 198.~~ (2) The right of objection conferred by subsection (1) applies irrespective of whether the developer has previously requested a reconsideration of a requirement for a development contribution under section 199A. (3) The right of objection conferred by this section does not apply to challenges to the content of a development contributions policy prepared in accordance with section 102.	To clarify the timing of the objection process is when a consent or authorisation is granted and not beforehand. Changes also proposed to clause 1 of Schedule 13A to clarify this matter. The word ‘developer’ is changed to ‘person’ to align with the wording used in the rest of the Amendment bill.
53	199D Scope of development contribution objection	An objection under section 199C may be made only on the grounds that a territorial authority has – (a) failed to properly take into account features of the objector’s development that significantly increase or decrease the requirement for community facilities, activities, or groups of activities in the territorial authority’s district or parts of that district; or (b) required a contribution for communities facilities, activities, or groups of activities not required by, or related to, the objector’s development; or (c) incorrectly applied its development contributions policy to the objector’s development.	(1) An objection under section 199C may be made only on the grounds that a territorial authority has – (a) failed to properly take into account features of the objector’s development that significantly increase or decrease the requirement for community facilities, activities, or groups of activities in the territorial authority’s district or parts of that district on its own or cumulatively in combination with other developments; or (b) required a contribution for communities facilities, activities, or groups of activities not required by, or related to, the objector’s development on its own or cumulatively in combination with other developments; or (c) incorrectly applied its development contributions policy to the objector’s development.	Accept this section with minor changes and additional clauses. The removal of community facilities removes duplication and unnecessary duplication. The additions to a) and b) are to recognise cumulative effects as provided for currently in the Act (s199(3)) and in the Amendment Bill (s197AB(a)). The addition of section 2 provides a more balanced objection process.
53	199E Procedure for development contribution objections	Schedule 13A applies in relation to objections under section 199D.		Support this section
53	199F Appointment and register of development contribution commissioners			Support this section
53	199G Removal of commissioners			Support this section
53	199H Who may decide development contributions objections			Support this section
53	199I Development contributions objection hearings			Support this section
53	199J Additional powers of development contributions commissioners			Support this section
53	199K Liability of development contributions commissioners			Support this section
53	199L Residual powers of territorial authority relating to development contributions objection decision			Support this section
53	199M Territorial authority to provide administrative support to commissioners			Support this section
53	199N Interim effect of development contribution objection	(1) If a development contribution objection is lodged, the territorial authority may still require the development contribution, but must not use it until the objection has been determined. (2) If a territorial authority does not require a development contribution pending the determination of an objection, the territorial authority may withhold consents or permissions in accordance with section 208 until the objection has been determined.	(1) If a development contribution objection is lodged, the territorial authority may still require the development contribution to be made, but must not use it until the objection has been determined. (2) If a territorial authority does not require a development contribution to be made pending the determination of an objection, the territorial authority may withhold consents or permissions in accordance with section 208 until the objection has been determined.	The inclusion of ‘to be made’ is to provide clarity.
54	200 Limitations applying to requirement for development contribution	(1) … (a) .. (b) .. (ba) the territorial authority has already charged a development contribution in respect of the same building work, whether on the granting of a building consent or a certificate of acceptance; or (2) … (3) This section does not prevent a territorial authority from requiring a development contribution if – (a) income from rates is being used to meet a portion of the capital costs of the community facilities for which the development contribution will be used; or (b) a person required to make the development contribution is also a ratepayer in territorial authority’s district (4) Despite subsection (1)(ba), a territorial authority may require another development contribution to be made for the same purpose if the further development contribution is required to reflect an increase in the scale or intensity of the development since the original contribution was required.	(1) … (a) .. (b) .. (ba) the territorial authority has already charged a development contribution in respect of the same building work, whether on the granting of a building consent or a certificate of acceptance; or (2) … (3) This section does not prevent a territorial authority from requiring a development contribution if – (a) income from rates or other funding sources listed in section 103(2) except development contributions or financial contributions is being used to meet a portion of the capital costs of the community facilities for which the development contribution will be used; or (b) a person required to make the development contribution is also a ratepayer in territorial authority’s district (4) Despite subsection (1)(ba), a territorial authority may require another development contribution to be made for the same purpose if the further development contribution is required to reflect an increase in the scale or intensity of the development since the original contribution was required.	Support the inclusion of Certificate of Acceptance. The inclusion of other funding sources is to resolve the uncertainty generated by specifically identifying rates income but not other funding sources.
55	201A Schedule of infrastructure for which development contributions will be used 201A Schedule of ~~infrastructure~~ assets for which development contributions will be used	(1) If a territorial authority has determined to see funding for community facilities under this subpart, the policy required by section 102 must include, in additional to the matters set out in section 106 and 201, a schedule that lists – (a) each new asset, additional asset, asset of expanded capacity or programme of works for which the development contributions requirements set out in the development contributions policy are intended to be used or have already been used; and (b) the estimated capital cost of each asset described in paragraph (a); and (c) the proportion of the capital cost that the territorial authority proposes to recover through development contributions; and (d) the proportion of the capital cost that the territorial authority proposes to recover from other sources (2) For the purposes of subsection (1), assets for which development contributions are required can be grouped together into logical and appropriate groups of assets that reflect the intended or completed programmes of works or capacity expansion. (3) A schedule under subsection (1) must also include assets for which capital expenditure has already been incurred by a territorial authority in anticipation of development. (4) Information in the schedule under subsection (1) must group assets according to the district or parts of the district for which the development contribution is required, and by the activity or group of activities for which the development is required. (5) A territorial authority may make changes to the schedule required by subsection(1) at any time without further formality or consultation, but only if – (a) the change is being made to reflect a change of circumstances in relation to an asset that is listed in the schedule or is to be added to the schedule; and (b) the change does not increase the development contribution that will be required to be made to the territorial authority. (6) If the territorial authority is satisfied that the schedule or any part of it is too large or impractical to print in hard copy form, the territorial authority may – (a) provide the schedule in a publicly accessible electronic format; (b) provide and maintain an electronic link from the development contributions policy to the schedule (if the policy is on the Internet) or state in the policy where a hard copy of the schedule can be found and inspected. (7) Subject to section 204, 205, and 206, a territorial authority may use a development contribution for or towards any assets other than those set out in the schedule required by subsection (1) as at the time the development contribution was required if – (a) the assets are for the same general function and purpose as those that were set out in the schedule required under subsection (1) as at the time the development contribution was required; and (b) the schedule required by subsection (1) has been updated in accordance with subsection (5), or will be updated when the development contributions policy is next changed or reviewed, to identify the assets that the development contribution has been, or is intended to be, used for or towards.	(1) If a territorial authority has determined to see funding for community facilities under this subpart, the policy required by section 102 must include, in additional to the matters set out in section 106 and 201, a schedule that lists – (a) each new asset, additional asset, asset of ~~expanded~~ increased capacity or programme of works for which the development contributions requirements set out in the development contributions policy are intended to be used or have already been used; and (b) the estimated capital cost of each asset described in paragraph (a); and (c) the proportion of the capital cost that the territorial authority proposes to recover through development contributions; and (d) the proportion of the capital cost that the territorial authority proposes to recover from other sources (2) For the purposes of subsection (1), assets for which development contributions are required can be grouped together into logical and appropriate groups of assets that reflect the intended or completed programmes of works or capacity expansion. (3) A schedule under subsection (1) must also include assets for which capital expenditure has already been incurred by a territorial authority in anticipation of development. (4) Information in the schedule under subsection (1) must group assets according to the district or parts of the district for which the development contribution is required, and by the activity or group of activities for which the development is required. (5) A territorial authority may make changes to the schedule required by subsection(1) at any time without further formality or consultation, but only if – (a) the change is being made to reflect a change of circumstances in relation to an asset that is listed in the schedule or is to be added to the schedule; and (b) the change does not increase the overall development contribution that will be required to be made to the territorial authority. (6) If the territorial authority is satisfied that the schedule or any part of it is too large or impractical to print in hard copy form, the territorial authority may – (a) provide the schedule in a publicly accessible electronic format; (b) provide and maintain an electronic link from the development contributions policy to the schedule (if the policy is on the Internet) or state in the policy where a hard copy of the schedule can be found and inspected. (7) Subject to section 204, 205, and 206, a territorial authority may use a development contribution for or towards any assets other than those set out in the schedule required by subsection (1) as at the time the development contribution was required if – (a) the assets are for the same general function and purpose as those that were set out in the schedule required under subsection (1) as at the time the development contribution was required; and (b) the schedule required by subsection (1) has been updated in accordance with subsection (5), or will be updated when the development contributions policy is next changed or reviewed, to identify the assets that the development contribution has been, or is intended to be, used for or towards.	Amending the title for consistency or wording used elsewhere in the Act and the Amendment Bill. (1)(a) changing ‘expanded’ to ‘increased’ to align with wording currently used in s199(1) of the Act (5) To address circumstances where changes to the schedule may result in the development contribution for one activity increasing but the development contribution for another activity decreasing with the overall effect being that the development contribution does not increase.
56	202 Contents section 201 schedule			Support this section
57	202A Reconsideration process to be in development contributions policy			Support this section
58	203 Maximum development contributions not to be exceeded	(1) Development contributions for reserves must not exceed the greater of— (a) 7.5% of the value of the additional allotments created by a subdivision; and (b) the value equivalent of 20 square metres of land for each additional household unit created by the development (2) Development contributions for network infrastructure or community infrastructure must not exceed the amount calculated by multiplying the cost of the relevant unit of demand calculated under clause 1 of Schedule 13 by the number of units of demand assessed for a development or type of development, as provided for in clause 2 of Schedule 13, and as amended for any Producers Price Index adjustment adopted in a development contributions policy accordance with section 106(2B)	(1) Development contributions for reserves must not exceed the greater of— (a) 7.5% of the value of the additional allotments created by a subdivision; and (b) the value equivalent of 20 square metres of land for each additional household unit or accommodation unit created by the development (2) Development contributions for network infrastructure or community infrastructure must not exceed the amount calculated by multiplying the cost of the relevant unit of demand calculated under clause 1 of Schedule 13 by the number of units of demand assessed for a development or type of development, as provided for in clause 2 of Schedule 13, and as amended for any Producers Price Index adjustment adopted in a development contributions policy accordance with section 106(2B)	To provide clarity and allow for new accommodation unit definition in S197
59	206 Alternative uses of development contributions for reserves	Amendment: replace ‘section 205’ with ‘sections 197AB(d) and 205’		Support this section
60	207A Request to enter development agreement			Support this section
60	207B Response to request for development agreement			Support this section
60	207C Content of development agreement			Support this section
60	207D Effect of development agreement	(1) A development agreement is a legally enforceable contract. (2) A development agreement has no force until all parties that will be bound by the agreement have signed it. (3) A development agreement does not oblige a territorial authority or any other consent authority to – (a) grant a resource consent under the Resource Management Act 1991; or (b) issue a building consent under the Building Act 2004; or (c) issue a code compliance certificate under the Building Act 2004; or (d) grant a certificate under section 224 of the Resource Management Act 1991; or (e) grant an authorisation of a service connection. (4) A territorial authority or other consent authority must not refuse to grant or issue a consent, certificate, or authorisation (as the case may be) referred to in subsection (3) on the basis that a development agreement has not been entered into.	(e) grant an authorisation for of a service connection.	Change ‘or’ to ‘for’ for consistency with the term used in S198
60	207E Restrictions on use of development agreement			Support this section
60	207F Amendment or termination of development agreement			Support this section
61	208 Powers of territorial authority if development contributions not paid or made			Support this section
*New Title*	*Miscellaneous*		New section heading Miscellaneous	To be placed before Section 211 Application of other Acts
New Section	S211A Service of documents		1) Where a notice or other document is to be served on a person for the purposes of this Subpart, it may be served— a) by delivering it personally to the person (other than a Minister of the Crown); or b) by delivering it at the usual or last known place of residence or business of the person; or c) by sending it by pre-paid post addressed to the person at the usual or last known place of residence or business of the person; or d) by posting it to the Post Office box address that the person has specified as an address for service; or e) by leaving it at a document exchange for direction to the document exchange box number that the person has specified as an address for service; or f) by sending it to the fax number that the person has specified as an address for service; or g) by sending it to the email address that the person has specified as an address for service. 2) Where a notice or other document is to be served on a body (whether incorporated or not) for the purposes of this Subpart, service on an officer of the body, or on the registered office of the body, in accordance with subsection (1) shall be deemed to be service on the body. 3) Where a notice or other document is to be served on a partnership for the purposes of this Subpart, service on any one of the partners in accordance with subsections (1) and (2) shall be deemed to be service on the partnership. 4) Despite subsection (1), if a notice or other document is to be served on a Crown organisation for the purposes of this Act, it may be served— a) by delivering it at the organisation's head office or principal place of business; or b) by sending it to the fax number or email address that the organisation has specified for its head office or principal place of business; or c) by a method agreed between the organisation and the person serving the notice or document. 5) Where a notice or other document is sent by post to a person in accordance with subsection (1)(c) or (d), it shall be deemed, in the absence of proof to the contrary, to be received by the person at the time at which the letter would have been delivered in the ordinary course of the post.	New section to be included. Linked to objection timeframes. Copied from the RMA where timeframes are set.
63	252 Recovery of debts			Support this section
65	259 Regulations	(e)		Support this section
Schedule 1	Schedule 1AA Application, savings, and transitional provisions relating to amendments to this Act made by the Local Government Act 2002 Amendment Act (No ) 2013	1 – 4 … 5 Transitional provision relating to development contributions (1) Territorial authorities may retain any development contributions made to them before the commencement of the clause, as if the Local Government Act 2002 Amendment Act (No 3) 2013 had not been enacted. (2) If a territorial authority is unable to or does not proceed with a community infrastructure work or programme because, as a result of the amendments made by the Local Government Act 2002 Amendment Act (No 3) 2013, development contributions can no longer be collected for that work or programme, the territorial authority may retain the development contributions already collected in relation to the work or programme, but contributions retained must be used for assets or groups of assets for the same or similar function or purpose within the district or part of the district from which the development contributions were required. 6 Transitional provision relating to certain consents, certificates, and requests (1) This clause applies to applications for a resource consent, building consent, certificate of acceptance, or request for service connection made before, and pending on, the commencement of this clause. (2) The applications must be dealt with as if the Local Government Act 2002 Amendment Act (No 3) 2013 has not been enacted. 7 – 9 …	5 Transitional provision relating to development contributions (1) Territorial authorities may retain and/or collect any development contributions ~~made to~~ required by them before the commencement of the clause, as if the Local Government Act 2002 Amendment Act (No 3) 2013 had not been enacted. (2) If a territorial authority is unable to or does not proceed with a community infrastructure work or programme because, as a result of the amendments made by the Local Government Act 2002 Amendment Act (No 3) 2013, development contributions can no longer be collected for that work or programme, the territorial authority may retain the development contributions already collected in relation to the work or programme, but contributions retained must be used for ~~assets~~ activities or groups of ~~assets~~ activities for the same or similar function or purpose within the district or part of the district from which the development contributions were required. (3) Territorial authorities may continue to require development contributions for projects completed, or substantially completed, before the enactment of the Local Government Act 2002 Amendment Act (No 3) 2013 until such time as the growth related capital expenditure for these projects that were being already being funded by development contributions has been fully recovered. 6 Transitional provision relating to certain consents, certificates, and requests (1) This clause applies to applications for a resource consent, building consent, certificate of acceptance, or authorisation ~~request~~ for service connection made ~~before,~~ and ~~pending~~ on granted before , the commencement of this clause. (2) These applications must be dealt with as if the Local Government Act 2002 Amendment Act (No 3) 2013 has not been enacted 7 – 9 … (1)	(1) Some development contributions have already been required but not yet paid. Payment requirement has passed and debt collection process is underway. (2) change ‘assets ‘to ‘activities’ to provide enough scope to use the funds if projects are cancelled. (3) This will prevent an immediate need to transfer large costs from DCs to rate funding (6) to provide clarity, the use of the word ‘granted’ aligns with S198 of the Act and the use of the word authorisation aligns with the term used in S198(1)(c) of the Act.
Schedule 6	Schedule 13	1 Methodology for relating cost of community facilities to units of demand … (2) This clause does not prevent a territorial authority from identifying capital expenditure for the purposes of calculating development contributions for infrastructure that will be built after 10 years and is identified in the development contributions policy. (3) The total cost of capital identified in subclause (1) may in part relate to assets intended to be delivered beyond the period covered by a territorial authority’s current long-term plan if – a. The assets concerned are identified in the development contributions policy; and b. The total cost of capital expenditure does not exceed that which relates to the period over which the development has been assessed for the purpose of setting development contributions.	1 Methodology for relating cost of community facilities to units of demand … (2) This clause does not prevent a territorial authority from identifying capital expenditure for the purposes of calculating development contributions for ~~infrastructure~~ assets or groups of assets that will be ~~built~~ delivered ~~after 10 years~~ beyond the period covered by a territorial authority’s long term plan and is identified in the development contributions policy. (3) The total cost of capital identified in subclause (1) may in part relate to assets intended to be delivered beyond the period covered by a territorial authority’s current long-term plan if – a. The assets concerned are identified in the development contributions policy; and b. The total cost of capital expenditure does not exceed that which relates to the period over which ~~the~~ development has been assessed for the purpose of setting development contributions.	1(2) change infrastructure’ to ‘assets or groups of assets’ to align consistency with the use of the terms elsewhere in the Act and the Amendment Bill Change the word ‘built’ to ‘delivered’ as reserve land is not built. Changing ‘10 years’ to ‘beyond the period covered by a TAs long term plan’ provides consistent wording use in S106(2A)(a). (3)(b) This is not a reference to a single development but development or growth generally.
Schedule 7	Schedule 13A Procedure relating to development contributions objections	New Schedule 13A set out in Schedule 2 1 Lodgment of objection (1) An objector lodges a development contribution objection by serving notice of the objection on the territorial authority within 15 working days after the date on which the objector received notice from the territorial authority of the level of development contribution that the territorial is proposing to require. (2) However, if an objector has received notice of the outcome of a reconsideration under section 199B, the 15 working day period in subclause (1) begins on the day after the date on which the objector receives the notice of the outcome. (3) The notice of objection under subclause (1) must – (a) be in writing; and (b) set out the grounds and reasons for the objection; and (c) the relief sought; and (d) state whether the objector wishes to be heard on the objection. (4) A territorial authority may, in its discretion, allow an objection to be served on it after the 15 day period specified in subclause (1) or (2), as the case may be, if satisfied that exceptional circumstances exist. 2 Selection of development contributions commissioners 3 Development contributions commissioners set date for exchange of evidence 4 Obligation to hold hearing 5 Hearing date and notice (1) If a hearing on an objection is to be held, the development contributions commissioners must fix the date, time, and place of the hearing. (2) Notice of a hearing must be served on the territorial authority and the objector at least 5 working days before the date on which the hearing commences. 6 Replies of briefs of evidence where no hearing is held 7 Development contributions objections hearings 8 Decision on objections 9 Service of development contributions objections decision Part 2 Provisions supplementing section 199I 10 Development contributions commissioners’ powers 11 Power to summon witness 12 Service of summons 13 Evidence 14 Other immunities and privileges of participants	New Schedule 13A set out in Schedule 2 1 Lodgment of objection (1) An objector lodges a development contribution objection by serving notice of the objection on the territorial authority within 15 working days after the date on which the objector or agent working on behalf of the objector received notice from the territorial authority of the level of development contribution that the territorial is proposing to require in accordance with section 199C(1). (2) However, if an objector has received notice of the outcome of a reconsideration under section 199B, the 15 working day period in subclause (1) begins on the day after the date on which the objector receives the notice of the outcome. (3) The notice of objection under subclause (1) must – (a) be in writing; and (b) set out the grounds and reasons for the objection; and (c) the relief sought; and (d) state whether the objector wishes to be heard on the objection. (4) A territorial authority may, in its discretion, allow an objection to be served on it after the 15 day period specified in subclause (1) or (2), as the case may be, if satisfied that exceptional circumstances exist. 2 Selection of development contributions commissioners 3 Development contributions commissioners set date for exchange of evidence 4 Obligation to hold hearing 5 Hearing date and notice (1) If a hearing on an objection is to be held, the development contributions commissioners must fix the date, time, and place of the hearing. (2) Notice of a hearing must be served on the territorial authority and the objector at least 510 working days before the date on which the hearing commences. (3) Any change to the objection or additional exchanges of evidence must be provided at least 10 working days before the date on which the hearing commences. 6 Replies of briefs of evidence where no hearing is held 7 Development contributions objections hearings 8 Decision on objections 9 Service of development contributions objections decision Part 2 Provisions supplementing section 199I 10 Development contributions commissioners’ powers 11 Power to summon witness 12 Service of summons 13 Evidence 14 Other immunities and privileges of participants	1 (1) to be consistent with proposed changes to s199A The addition of ‘in accordance with section 199C(1)’ is to clarify that this clause related back to that section. This is required so the two provisions do not contradict each other. 5 (2) change ‘5’ working days to ‘10’ working days. Many council’s have one single staff member that is critical to the hearing process and communicating the territorial authority position. This person may not be able to attend on such short notice.

[1] This is the additional cost of interest on debt funding required to replace development contributions.

[3] Source: Some External Constraints and Constitutional Principles, www.pco.parliament.govt.nz/external-constraints

[4] Source: LAC Guidelines Chapter 3: Basic principles of New Zealand’s legal and constitutional system, www.pco.parliament.govt.nz/lac-chapter-3/

[5] Auckland Council considers based on experience with Resource Management Act hearings that the costs of space, administration and commissioners will range from $5,000 to more than $20,000. The actual cost will depend on the size of development and level of complexity. These costs would be recoverable from objectors. Any very small developments taken to the objection process will have much lower costs.

INTRODUCTION
	1. This is Auckland Council’s submission in response to the Local Government Act 2002 Amendment Bill (No 3) (the Bill). 2. The address for service is Auckland Council, Private Bag 92300, Victoria Street West, Auckland 1142. 3. Please direct any enquiries to Dr Roger Blakeley, Chief Planning Officer. Phone 09 307 6063 or email roger.blakeley@aucklandcouncil.govt.nz 4. Auckland Council wishes to appear before the Local Government and Environment Select Committee to discuss this submission. 5. This submission has been approved by the governing body of Auckland Council. In addition the views of XX local boards are included as appendices.
Structure of this submission	6. Part one of this submission addresses all matters covered in the Bill except those related to the proposed changes to the development contributions system. Part two focuses exclusively on development contributions. The relative imbalance between the two parts reflects the fact that whilst Auckland Council supports much of the Bill it has very significant concerns with many of the proposed changes to the development contributions framework.
RECOMMENDATIONS
	7. In relation to the Local Government Act (2002) Amendment Bill (No 3) Auckland Council: a. supports provisions to enable local boards to be established elsewhere in New Zealand as part of local authority reorganisation proposals; b. seeks clarification as to whether the local board provisions set out in new sub-part 1A of the Bill are to apply to Auckland Council in the event of a reorganisation proposal; c. suggests that the Local Government (Auckland Council) Act 2009 (LGACA) be amended to be consistent with the Bill by confirming that local boards do not have separate legal standing from the council; d. suggests the deletion of sections 23(2) and (3) from the LGACA as the obligations they set out in relation to the audited statements of local board are duplicated in the Bill; e. suggests that a restriction be included in the Bill and LGACA limiting successful local board candidates to membership of a single local board; f. opposes provisions in the Bill that would enable governing body members to be appointed to sit on local boards in the event of a reorganisation; g. supports the removal of the mandatory requirement to use the special consultative procedure in most circumstances; h. supports the proposed changes to the SCP process itself; i. suggests removal from other Acts of the mandatory requirement to use the SCP; j. supports proposals to allow for the greater use of technology in council meetings but suggests that rules around the physical quorum required for meetings be addressed in council standing orders rather than legislation; k. supports changes to the consultation processes for the long term and annual plans; l. supports the requirement that councils develop a significance and engagement policy but requests that the adoption date be pushed back to no later than 1 July 2015; m. supports the requirement for councils to develop a 30 year infrastructure strategy; n. seeks inclusion in the Bill of provisions to enable councils to specify, following appropriate community consultation, bylaw breaches that would be subject to an infringement notice; o. supports the general intent of new section 17A that councils review their service provision arrangements on a periodic basis but suggests the scope of the review be limited to significant public facing services, and that councils be given more discretion to determine how often they conduct the review; p. seeks clarification of matters on potential legal challenges to the mana whenua selection body for membership of the Independent Maori Statutory Board; q. supports the reinstatement in the LGACA of governing body responsibility for Auckland Council decision making for transport networks and infrastructure; r. suggests that a broader definition of what constitutes a working day, more in keeping with the Local Government Official Information and Meetings Act and the Resource Management Act rather than the Local Government Act, be adopted in relation to the proposed independent objections process for development contributions; s. supports the introduction of new purpose and principles for development contributions; t. supports the requirement to improved transparency in development contributions policy development; u. supports the additional requirement to consider development agreements; v. supports the introduction of inclusion of a reconsideration process; w. supports the majority of technical updates proposed; x. seeks changes to the definition of community infrastructure to include libraries, swimming pools, sports infrastructure and other public amenities y. seeks an additional principle to allow councils to continue to perform an individual assessment based on category and geographical location; z. seeks to offer councils an alternative option to the ex-ante review of the policy to replace the ex -post objection process; except in determining if the development contribution has been applied correctly; aa. seeks to amend the independent objection process to take into account the amended principles including the additional principle of averaging; bb. seeks changes to the commencement date for community infrastructure to align with the 2015-2025 Long-Term Plan; cc. seeks a number of additional minor amendments detailed in the appendix three
EXECUTIVE SUMMARY

Value of assessment	Number of assessments	Average assessed contribution excl GST	Total assessed contributions excl GST
0	9115	$0.00	$0.00
1 - 25,000	4219	$16,046.45	$67,699,990.00
25,000 - 50,000	489	$38,765.04	$18,956,106.33
50,000 - 100,000	273	$69,404.39	$18,947,399.03
100,000 - 200,000	135	$139,902.12	$18,886,785.80
200,000 - 500,000	99	$310,200.97	$30,709,895.55
500,000 - 1,000,000	53	$681,108.11	$36,098,729.62
1,000,000 +	36	$2,017,041.22	$72,613,483.81
Grand Total	14419	$18,303.10	$263,912,390.14