In this edition:
Turning up the heat on climate change policy
As part of its plan for its first 100 days in office, the Government has announced a range of initiatives that seek to lower emissions and reduce the impacts of climate change in New Zealand.
One of the key initiatives is the proposal to introduce a Zero Carbon Bill into Parliament by October this year. The Government has indicated that the Bill will include a new long-term target for reducing greenhouse gas emissions by 2050 and the requirement for five-yearly carbon "budgets". The Minister for Climate Change, James Shaw, has said that "putting a new climate change target into law will hold the Government to account and place New Zealand in a small group of countries who aspire to net-zero emissions in the next few decades".
To ensure New Zealand stays on track with meeting its climate change goals, the Bill also proposes the establishment of an independent Climate Change Commission to provide independent advice to the Government on tackling climate change issues.
The Government has, however, identified a number of priorities that require immediate progress in the coming year, in advance of the independent Climate Change Commission being established in mid-2019 (subject to the legislative process for the Zero Carbon Bill). To keep the heat on these priorities, the Government will establish an Interim Climate Change Committee by mid-March 2018, which could be tasked with a range of functions including:
- evaluating the role of agriculture in climate change;
- investigating the possibility of transitioning to 100% renewable electricity;
- researching the appropriate level of the first carbon "budgets" to be set under the Zero Carbon Bill and the level of the 2050 target; and
- engaging with key stakeholders and the wider public from mid-2018.
The Minister for Climate Change is due to report back to Cabinet later this month on the terms of reference for the Committee, and the timing and sequencing of key government decisions on priority climate change policy matters.
The Government has also confirmed that it is committed to a public consultation phase on the Bill, which will commence in May/June of this year.
Allison Arthur-Young & Aidan Cameron
The Auckland Unitary Plan – are we interpreting it correctly?
In Auckland Council v Budden  NZEnvC 209, Auckland Council (Council) sought declarations from the Environment Court to confirm whether it had been correctly applying the Special Character Area Overlay – Residential (SCAR) and Residential – Single House Zone (SHZ) provisions in the Unitary Plan.
In essence, the Council sought declarations that the rules and performance standards in the SCAR act as a "replacement package", such that the performance standards of the SHZ do not need to be considered when determining applications for resource consent within the SCAR. This approach formed the basis for its Practice Note, which the Council had issued as guidance for its in-house planners in applying the SCAR (and other overlay) provisions in the Unitary Plan.
A number of landowners within the SCAR and other interested parties disagreed with the Council's approach, contending that the SCAR does not nullify the performance standards in the SHZ rules, but rather that all rules relevant to an activity must be applied.
Several parties also joined the proceedings as interested parties due to the potential for the declarations sought to have wider implications for the operation of other overlays in the Unitary Plan. Many of those parties joined the proceedings because, in addition to the more focused declarations on the application of the SCAR and SHZ provisions, the Council had also originally sought a declaration relating to the operation of overlays in the Unitary Plan more generally. This declaration was subsequently withdrawn, with the proceedings focused squarely on the interplay between the SCAR and SHZ provisions.
Given that there are a number of live disputes regarding current resource consent applications for activities in the SCAR, the Court issued an urgent interim decision in December 2017, declining to make the declarations sought by the Council. The Court considered that the Council's interpretation of the SCAR was flawed and that its Practice Note for its in-house planners should be withdrawn immediately. While the Court accepted that, at least in theory, a district plan could give pre-eminence to one set of values (eg special character), in this case the Court did not consider (in light of the objectives and policies of the SCAR) that all competing resource management values must give way to special character. In the Court's view, if the Council's interpretation was adopted, there was the potential for "very significant resource management impacts to go unchecked by consenting processes".
In early 2018, the Court subsequently issued a further interim decision, in which it put forward a revised declaration relating to the interplay between the SCAR and the SHZ provisions. Importantly, the Court also directed the Council to complete an analysis of all of the overlays in the Unitary Plan and their interrelationship with the relevant zone provisions.
The Court will issue a third and final decision in due course, in which it will make the alternative declaration set out in its second interim decision and potentially expand on the reasons for its alternative declaration. This decision highlights some of the interpretative challenges that are already appearing as plan users grapple with consenting under the new Unitary Plan framework.
Daniel Minhinnick & Lauren Eaton
Disclosure: Russell McVeagh acted for Auckland Airport, Brookby Quarries Limited, Fulton Hogan Limited, Stevenson Group Limited and Winstone Aggregates as section 274 parties in these proceedings.
Looking ahead - Long-term plan consultation
Every three years regional, district and city councils are required to review their long-term plans (LTP), which set the councils' budget for the next ten years.
A number of councils are reviewing their LTPs this year (including Auckland Council), with most drafts being released for public consultation in late February/early March. Councils must follow a special consultative procedure when preparing LTPs, which requires an opportunity for submissions and submitters to be heard. With draft budgets being adopted in June, this typically allows one month for reviewing the draft LTP and preparing a written submission.
Based on the draft LTPs that are already out for consultation, rates increases look to be a common theme across the country:
- The commercial sector in Tauranga stands to be particularly affected by Tauranga City Council's proposal to increase the residential-commercial differential to 1:1.6 by 2020, resulting in a 60% rates increase for commercial rate-payers.
- Similarly, Hamilton City Council has also proposed significant rates increases, of 9.5% for two years, taking effect in the 2018/2019 financial year for all existing rate-payers. This is in addition to a proposal to bring in a 100% capital value rating system for 2018/2019. This is a significant departure from the 2014 Council decision to transition from a land value rating system to capital value, which would see 100% capital value not take effect until the 2024/2025 financial year. Although not as stark as the commercial differential proposed in Tauranga, this increase effectively acts as a target for large commercial properties with high capital value.
Auckland Council is set to release its draft LTP for consultation on 28 February this year. In our December update last year, we outlined the Mayor's budget proposal for Auckland, which will inform the draft LTP. Mayor Goff is publicly committed to a general rates rise of 2.5% or less, but other levies and targeted rates are proposed that may increase the burden considerably on some Auckland ratepayers.
Please contact one of our experts if you would like any further information on the implications of the LTPs that are already out for consultation or the upcoming submission process.
Allison Arthur-Young & Simon Pilkinton
High Court confirms you can't take short-cuts
The High Court has issued a decision that will have significant implications for plan making, especially in areas subject to "avoid" policies or environmental bottom lines in the New Zealand Coastal Policy Statement (NZCPS).
In Royal Forest & Bird Protection Society Incorporated v Bay of Plenty Regional Council  NZHC 3080, Royal Forest & Bird succeeded in its appeal against an Environment Court decision on the Bay of Plenty Proposed Regional Coastal Plan (Coastal Plan).
The Environment Court was tasked with setting the policies and rules in the Coastal Plan, when it was agreed that the objectives in that plan reflected the NZCPS and were in keeping with all superior documents and Part 2. The question, as cast by the Environment Court, was which of the options were most appropriate to give effect to the settled Plan objectives.
The Environment Court then devised a "proportionate response" by reference to King Salmon – with the words "avoid" and "appropriate" capable of varying in meaning depending on context; both the context of the words in the plan, but also of the individual case, application or environment. It concluded a proportionate response could be adopted, having regard to the particular activity and all other factors that go to its appropriateness.
In its decision, the High Court confirmed that:
- There is no shortcut in plan making. Even when the objectives they sit under are settled, rules and methods must be checked against the higher order documents as required by the RMA. It is incumbent on decision makers to check, particularly where the objectives could lead to more than one policy framework. This is to avoid the story being "lost in the re-telling".
- Avoid continues to mean avoid. The more restrictive regime flowing from King Salmon (where avoid means avoid, and tensions need to be resolved rather than glossed over in an overall broad judgement) does not permit the "proportionate" or contextual approach. It was seen as an attempt to read down the Supreme Court's interpretation of the NZCPS in King Salmon, and its "avoid" policies. This would have allowed a more permissive planning framework for regionally significant infrastructure than what RFB had sought, and what the Court held the NZCPS required. The High Court saw the "contextual" approach as synonymous with the overall broad judgment approach previously rejected by the Supreme Court in King Salmon.
The High Court's findings are general in nature and likely to be broadly applicable to all plan-making processes.
In the current context, it effectively directs that (in order to give effect to the NZCPS) plans should not allow (ie they should prohibit, or, at the very least, make non-complying) the location of regionally significant infrastructure in areas where it will have adverse effects on significant indigenous biodiversity. The Court's findings would be equally applicable to areas of outstanding natural character or landscapes, or other areas protected by environmental bottom lines in higher order documents.
Moving forward, this decision may have significant implications in future plan reviews, which will have flow on implications at the time of consenting/re-consenting activities. Please get in touch with one of our experts should you wish to discuss what this decision may mean for your business.
Bronwyn Carruthers & Cameron Law
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