Whether there is a "centre of activity"
78The next question to determine is whether there is an area that can properly be regarded as being a "centre of activity", in which the subject property is located.
79Barrak submits that the zoning of the property is fundamental in understanding whether it is within the relevant "centre of activity". Additional factors are the label applied to describe the sub-category; the physical uses and built form which are materially different to those on the northern side of Kendall Street and on the western side of the railway; the removal of parking meters and changes in parking restrictions in the Harris Park area; the way in which the Council approached the rating of Harris Park in 2013; and whether it is fair and equitable to impose the Business CBD rates on the property.
80Considering first the zoning of the property, Barrak submits that the Business zoning under the 1989 LEP was the only reason to create the Business CBD sub-category initially and to include this property in that sub-category. That was reasonable in 1995, when the property was identically zoned to the land in the CBD core and to the north of Parramatta. However, the property is now zoned B1 Neighbourhood Centre, while the land on the other side of Kendall Street, the land in the block between Una Street, Wigram Street, Harris Street and Parkes Street, and the land on the other side of the railway line is zoned B4, while other land closer to the centre of Parramatta is zoned B3. Barrak submits that when the property was placed in the Harris Park Precinct under the Parramatta REP in 1999 a significant change in planning intent occurred. The objectives for the Business zone under Part 4 Precinct 2 - Harris Park Precinct were provided in cl 29F(1) (emphasis added):
(a) to provide opportunities for low scale retail and commercial development which supports surrounding residential development,
(b) to encourage the integration of commercial centres with public transport and pedestrian networks,
(c) to meet the urban design objectives set out in this Part and (where applicable) to comply with the controls for Special Areas as set out in this Part.
81Barrak submits that the objectives of the City Core, Retail Core and City Edge zones within Precinct 1- City Centre Precinct were markedly different, and the introduction of the REP cannot be regarded as an "administrative carve up". It represented a down-zoning of the property, with the creation of the City Core, Retail Core and City Edge zones, and the separate Harris Park precinct. While the making of the Parramatta REP did not affect ratings, given the Council's resolution in 1995 it ought to have recognised that the making of the REP left its earlier rating decision without a rationale, and that when the REP was made that was a strong indication that the Harris Park precinct was not part of the city centre of Parramatta.
82The Council submits that the centre of activity need not, and generally would not, coincide with any local environmental plan boundaries or zoning boundaries, and that the argument that the actual zoning matters in determining ratings sub-categories must fail. First, zoning and rating processes are entirely separate, being effected under different statutes and by different levels of government, and there is no basis for the submission that the ratings sub-category should coincide with zoning boundaries. Secondly, there are several different zonings under the 2007 LEP, and the rating sub-category must be able to accommodate more than one zoning on the applicant's own case. Thirdly, when a comparison is made between the ratings categories and sub-categories and the Harris Park zoning map under the 2011 LEP, there would be many ratepayers situated next to higher zoned land (including B4 land) who are subject to the same rating as the higher zoned land. Fourthly, if the zoning is relevant in the way submitted by the applicant, then the CBD centre of activity boundary does accord with zoning to some extent, as it takes in the B4 Mixed Use zoning within the 2007 LEP and that part of Harris Park zoned B1 Neighbourhood Centre. The Council submits that the legal source of the zoning objectives and restrictions applying to particular property is just an administrative arrangement, stemming in the circumstances here from the re-organisation effected by the Parramatta REP, and that it does not matter whether it is the 2007 LEP or the 2011 LEP that applies, which is underscored by the proposed amendments to the 2011 LEP so that one instrument will apply across the Parramatta LGA.
83I accept the Council's submissions. The zoning history since the 1989 LEP reflects decisions both of the Council and the NSW Government, the latter primarily in the decision to make the Parramatta REP in 1999 which, among other things, removed the centre of Parramatta from the local planning controls when separate planning controls were applied to Precinct 1-City Centre and Precinct 3-Government. The subsequent planning history, including the addition to the Parramatta REP of controls for the Harris Park Precinct, the continuation of separate controls for the city centre in the 2007 LEP, and the proposed amalgamation of the 2007 LEP and 2011 LEP, reflects the exercise of different legislative powers, at different levels of government, at different times, and for different purposes to those exercised for rating purposes under the LG Act. There is in my view no basis for a suggestion that rating sub-categories which depend either on actual use, or by reference to a spatial criterion, should necessarily reflect the zoning, even if the zoning might be the basis (whether for convenience or otherwise) on which the boundaries of the sub-category are at any point of time determined, or identified. Further, to the extent that the zoning is significant in determining whether there is a centre of activity, and if so, whether particular land is within that centre of activity, there are two reasons why that is not determinative in the circumstances of this case, and in any event would lend support to the Council's determination that the property is within the relevant sub-category.
84First, the 2007 LEP and the 2011 LEP need to be considered together to obtain a complete picture of the zoning. The 2007 LEP includes an area in the centre of Parramatta to the east of Church Street and extending as far south as Hassall Street which is zoned B3 Commercial Core, which is surrounding by land zoned B4 Mixed Use. The relationship between the two is made clear in the stated objectives for each zone. Those for the B3 zone include:
· To provide a wide range of retail, business, office, entertainment, community and other suitable land uses which serve the needs of the local and wider community, including:
· commercial and retail development,
· cultural and entertainment facilities that cater for a range of arts and cultural activity, including events, festivals, markets and outdoor dining,
· tourism, leisure and recreation facilities,
· social, education and health services.
...
· To strengthen the role of the Parramatta city centre as the regional business, retail and cultural centre, and as a primary retail centre in the Greater Metropolitan Region.
85The objectives for the B4 zone include:
To support the higher order Commercial Core Zone while providing for the daily commercial needs of the locality, including:
· commercial and retail development,
· cultural and entertainment facilities that cater for a range of arts and cultural activity, including events, festivals, markets and outdoor dining,
· tourism, leisure and recreation facilities,
· social, education and health services,
· high density residential development.
86The area in which the property is located, at the boundary between the 2007 LEP and the 2011 LEP, has a business zoning, B1 Neighbourhood Centre. While the objectives and permitted uses are not the same as those for either the B3 or B4 zones, the B1 zone includes a range of permissible business and retail uses, including relevantly, a restaurant or café, and prohibits residential accommodation other than specified limited types. When considered together, the zoning provisions in the 2007 LEP and the 2011 LEP reflect an area that has a central core, a surrounding commercial and business area, and an area at the fringe in which the property is located. While the detail of the zone objectives and permissible and prohibited uses, has changed since the 1989 LEP, that is consistent with the approach adopted in that LEP with its 3(f-r) and 3(f) business zones. The proposal to amalgamate the 2007 LEP into the 2011 LEP does not change that.
87Secondly, having regard to the land that is used for commercial or retail purposes but is not included in the Business CBD sub-category, the land on the eastern side of Wigram Street and extending south along Wigram Street to Marion Street is zoned R2 Low Density Residential. The only form of commercial or retail use permissible with consent in that zone is "neighbourhood shops", and it was common ground that the businesses presently operating in that area, in particular as restaurants, are doing so either as some form of existing use or pursuant to the conservation incentive provision in cl 5.10 of the 2011 LEP. Leaving aside any difference that this might make to the land value and thus to the actual amount of rates paid, the zoning of the subject property as B1 Neighbourhood Centre incorporates higher development potential than is the case for the businesses on the other side of Wigram Street which are zoned R2. It does not suggest that the property, and the other land zoned B1, more properly belongs in the same sub-category as those residential zoned properties.
88Rather than it being the inclusion of land zoned B1 Neighbourhood Centre in the Business CBD sub-category together with land zoned B3 or B4, if there is an anomaly it would seem to be with the eight lots on the northern side of Marion Street (to the south of the subject property) between Wigram Street and Harris Street that were zoned Residential Conservation 2(g) under the 1989 LEP, re-zoned Business in 2001 under the Parramatta REP, and now B1 Neighbourhood Centre under the 2011 LEP. Those lots are not included in the Business CBD sub-category on the Centre of Activity Map, and for rating purposes, are either Residential or Business General on the Ordinary Rates Map. However, whether or not those properties could be regarded as being in the relevant centre of activity is not a matter that needs to be considered in this appeal.
89The first additional factor on which Barrak relied was the label attached to the sub-category. Barak submits that in 2000, when the Council changed its identification of the land within the sub-category from Business zoning to the Centre of Activity Map, the Council did not turn its mind to whether the sub-category should still be described as "CBD". Barrak relies on a number of Council documents, including a press release from May 2013 announcing the upgrade of street paving, signage and furniture on Wigram Street between Marion and Ada Streets (exhibit A, tab 13), in support of its submission that there is a distinct neighbourhood of Harris Park, and that the use of the term "CBD" does not include Harris Park.
90The reasons why I would not regard the label affixed to a sub-category as necessarily significant are provided above at paragraph [72]. In the circumstances of this case, where the Business CBD sub-category label was initially applied to land "because it is land which is zoned 'Business'...", and most recently "because it is within the geographical area which is highlighted on the map...", the use of the term "CBD" does not necessarily do other than provide the label required by s 543 of the LG Act. It might be different had either resolution stated that land was within the sub-category "because it is in the CBD": however, even the term "CBD" itself is capable of a range of meanings. I accept that there may be an understanding of Harris Park as a distinct community or area. That would not preclude a particular lot within Harris Park also being considered to be part of another, larger, area centred on the central core of Parramatta.
91The second additional factor relied upon was physical uses and built form. Barrak submits that a "centre of activity" needs density and a concentration of activity, and that there is a cohesion in the B4 area, and also in the transition to the more cohesive B3 area. Harris Park has its own homogeneity, reflected in the low scale village character, but it is not that of the B3 or B4 land. The zoning and heritage constraints in Harris Park mean that there is a stark change in the form of development. For the reasons above at paragraphs [83]-[88] I do not regard the zoning, or the heritage constraints of other land in the immediate locality of the property, as requiring a conclusion that the property is not within a centre of activity. The broader issue of differences in physical uses and built form, and cohesion, is significant, and is considered below.
92The third additional factor is the changes made to parking controls in the Harris Park area. In 2009 the Council considered an options paper in relation to changing parking meter restrictions, with the paper recommending allowing for more all day parking in Harris Park by allowing all day ticketed parking on one side of the street with the other side being free but time restricted to 1-2 hours, for all the streets in Harris Park "except for the main commercial streets, those being Marion Street, Wigram Street (between Parkes Street and Marion Street), and Kendall Street (due to its close proximity to the CBD)" (exhibit A, tab 32, p14). The report also recommended that paid parking be retained in the section of Wigram Street and Harris Street north of Parkes Street and part of Hassall Street (which was at that time in a different zone to the rest of Harris Park) "due to its close proximity to the CBD". Barrak submits that if the area north of the subject property was not regarded as part of the CBD but merely proximate to it, the property could hardly be regarded as a CBD location, and the downgrading of parking restrictions and removal of meters speaks against part of Wigram Street being regarded as a centre of activity.
93In my view the changes to the parking controls do not support the proposition that the property is not within a centre of activity. The Parking Meters Options Paper 2009 and the report to the Council by the Service Manager, Traffic and Transport dated 21 November 2012 both indicate that these recommendations were made in response to concerns raised that employees of businesses in Harris Park did not have access to all day parking in close proximity to their place of employment (exhibit A, tab 32, p3, p 10); and that in light of the restrictions imposed by the RTA on the issuing of any additional business parking permits, those concerns could be addressed by varying the parking restrictions to allow more all day parking (exhibit A, tab 32, p 5). That issue was considered in the Options Paper along with the question of whether the free 15 minute parking ticket scheme should be extended to all parking meters in Parramatta, and if so, what options were available to recover revenue. The report to Council in 2012 indicates that the implementation of changes to parking restrictions were appropriate to be carried out together with the installation of new parking meters approved in October 2012 and to be installed in early 2013 (exhibit A, tab 32, p 1). I do not regard the changes to parking restrictions as any indication either way as to whether the property, or its immediate locality, can be regarded as within a centre of activity. At its highest, those changes support the proposition that the pattern of usage and demand for parking, including from visitors and employees, is variable across the Parramatta LGA, and that the Council has most recently addressed changing circumstances in its decision in 2012 to change the location of meters and timing and other restrictions on parking in part to satisfy demand for all day parking.
94The fourth additional factor relied upon by Barrak was the way in which the Council purported in 2013 to extend the number of properties within the Business CBD sub-category and the consequent review of Harris Park rating, summarised at paragraphs [44]-[46] above. Barrak submits that this indicates that the Council has not given proper thought to what the boundaries of the centre of activity are, or turned its mind to the question of whether the property should be in the Business General sub-category. Barrak submits that the evidence is that far from it being likely that those 70 properties will be re-rated Business CBD in the near future, the significant public outcry as a consequence of the Council's attempt to rate the area as Business CBD forced the Council to back down, and the Council has now resolved to review all of the rates for the whole of Harris Park.
95I do not agree that the sequence of events concerning the 2013/2014 rating of the 70 properties in the area bounded by Una, Wigram, Marion and Harris Streets supports the proposition that the property is not within the centre of activity. It clearly was an error, acknowledged in the Lord Mayoral Minute of 11 November 2013, to charge Business CBD rates for those 70 properties, "as the maps for rating purposes did not identify these properties as CBD business rates" (exhibit A, tab 31). The notes from the workshop on 6 November 2013 (exhibit A, tab 29) indicate the range of issues discussed, summarised as:
Bottom line - rates
parking
what services might be expected
current state (run down) of properties. Rubbish on streets
heritage - limits opportunities for development - until last 10 years. Not much happening - changed to commercial/restaurant then increased rates
96The issues raised at the workshop, and noted in the Mayoral Minute (exhibit A, tab 30), traversed matters beyond the increase from Business General to Business CBD ordinary rates for the 70 affected properties, and included lack of correlation between the increase in rates and the infrastructure and services delivered, and also the imposition of the CBD infrastructure special rate. Whether or not the review of the rates for Harris Park ultimately results in any change to the determination of the Business CBD sub-category or the creation of any new sub-category, or other changes for example reallocation of spending on infrastructure by the Council, in my view the process leading up to the review does not of itself provide a basis for determination now of the question of whether the subject property is within a centre of activity which is the Business CBD sub-category.
97The final additional factor relied upon by Barrak was fairness. Barrak submits that the overall effect of the Business CBD sub-category is to increase the rates by some 90 percent; that the change of sub-category would have no material effect on the ratepayers of Parramatta; and that it is disproportionate that the additional rates are paid by the 20 properties which are in the B1 zone and also within the Business CBD sub-category. Barrak accepts that there is a limited role for any notion of fairness in the declaration of a category or sub-category (Marrickville Metro (Pain J at [94]-[95]); City of Sydney at [49]), however submits that in an appeal on the merits under s 526 the Court can consider whether the property should go into a different sub-category, or whether there was no rational basis for it to be included in the Business CBD sub-category. On that basis it is relevant that the owners of the other 70 properties in the Business General sub-category are paying a fraction of the rates when there is nothing to distinguish the properties; and while there may initially have been a difference in development potential for this property, now there is not.
98I agree with the Council that any general concept of fairness has a limited role in the context of this appeal. As Pain J made clear in Marrickville Metro (at [94]), there is nothing in the LG Act that requires a council to deal with similar categories of ratepayers on the same basis, and the overriding requirement is that all the properties in the same category or sub-category must pay the same amount of rates. Her Honour went on to state:
95 Even if fairness is an essential part of the approach required by the LG Act, what fairness means has to be assessed in the context of the whole of the rate setting exercise. That one large ratepayer pays more than others, and has a sense of grievance about that does not lead automatically to the conclusion that that ratepayer has been treated unfairly.
99The Court of Appeal agreed, Tobias JA noting (at [75]) that that case involved the "differential allocation of the rating burden within the LGA as permitted by law". While Marrickville Metro was a challenge to the determination of the sub-category, and not an appeal against a refusal to change the sub-category, there is no indication in the provisions of ss 525 and 526 that the absence of some commercial competitors from a rating sub-category is a relevant factor in deciding whether the applicant's property should remain in that sub-category or be put in another. Any general consideration of fairness would, as submitted by the Council, be impossible for the Court to judge, and would depend on factors such as the land value of each lot, the costs incurred by the Council in servicing the land, and how other ratepayers are treated, for example in provision of infrastructure and services, matters on which the Court has no evidence. More importantly, the task of deciding the differential allocation of the rating burden within the LGA is clearly imposed on the Council, and not the Court: Marrickville Metro.
100The Council submitted (written submissions, [50]) that the following factors are relevant in consideration of the characteristics of the asserted centre of activity:
(1) Other than the area bounded by Una, Wigram, Marion and Harris Streets, the CBD centre of activity is in the shape of an elongated oval, centred on the intersection of Smith and Macquarie Streets. So far as geography is concerned the property is a natural part of that oval that radiates from the absolute commercial centre; the property is approximately 450m from the absolute city centre, while other lots (particularly the northern end of Church Street) are considerably further away;
(2) The centre of activity encompasses a diverse range of land uses and business types, with small lots and intensive retail apparent near to the absolute city centre, larger lots with uses other than retail more apparent towards the edges, and many restaurants of a similar character to the one operated on the property;
(3) The centre of activity does not include the highly intensive retail activity conducted in the Westfield shopping centre which is within a separate rating sub-category;
(4) The centre of activity encompasses a diverse range of built forms. High rise buildings tending to congregate towards the absolute city centre, however the built form is constrained by heritage considerations even close to the absolute city centre. There is no uniform trending in built form away from the absolute city centre, and Harris Park is also constrained by heritage considerations;
(5) The streets within the centre of activity are subject to a range of levels of public infrastructure and parking restrictions;
(6) The centre of activity includes and encompasses a number of natural barriers or dividing lines generally constituted by transport routes;
(7) The centre of activity has a core or middle area and areas around the fringes, and in that sense it is more like Ranglen than the more homogeneous or cohesive centre of activity in Marrickville Metro; and
(8) The unifying feature of the centre of activity is that there is a concentration of business rather than residential use, and where there is residential use it is generally mixed use. That is consistent with the inclusion of the property in the centre of activity since the property is just to the north west of an area characterised by a mix of small owner/operator business and residences.
101Barrak submits in response to those factors:
(1) Distance may be relevant but not to the exclusion of other characteristics, and an area that is close to a geographic centre may nevertheless be separated from it by a physical boundary such as a road or railway line. Church Street is distinctly the "main street" of Parramatta and is the northern entry point to the city; Wigram Street is not a gateway to the Parramatta city centre; and any particular lot has to be in the centre of activity;
(2) While there is a variety of activity and range of uses including restaurants in Church and George Streets, they are in the heart of the CBD and are zoned accordingly. There are many restaurants in Wigram Street that are no different to the subject site, have the same zoning and are rated Business General. There is a cohesion to Harris Park, but it is not in common with the CBD;
(3) The applicant does not seek to exclude itself from the centre of activity by comparison with the activity in the Westfield shopping centre, and plainly enough that centre forms a distinct centre of activity of its own;
(4) While the centre of activity contains a diverse range of built forms, and built forms are constrained by heritage considerations in the CBD and Harris Park, the subject site is not so constrained, but is constrained by the zoning which anticipates a lower scale form than much of the CBD. There must be congruity and homogeneity, not diversity;
(5) The infrastructure provision is clearly different, for example there is no undergrounding of electricity as is the case in the centre of Parramatta, and there are no parking meters; and the Council has not identified any other area where parking restrictions have been downgraded;
(6) While the railway line does bisect the CBD in a practical sense it does not dissect access across the CBD; there are crossings at Pitt, O'Connell, Church, Marsden, Hassall and Parkes Streets. In contrast Harris Park is disconnected. The railway line acts as a barrier between Harris Park and the southern reaches of the CBD, and there are no crossings between Parkes Street and Cambridge Street. The character of Parkes Street is significant, as a four lane carriageway part dual carriageway connecting the Great Western Highway to James Ruse Drive, which operates akin to an inner city by-pass of the south of Parramatta city centre and divides Harris Park from Parramatta city centre;
(7) It is accepted that a centre of activity can have a core, middle and fringe. The Parramatta REP recognised that yet did not include the subject property in any of those precincts, and further the Council has not identified any rational explanation as to why the boundary of the centre of activity even if it could be said to be CBD fringe runs along Ada Street; and
(8) The applicant agrees that the property is within a concentration of low scale businesses and that it lies to the north west of an area characterised by a mix of small owner/operator businesses and residences, however those small-scale businesses are not identified as being within the CBD centre of activity. There needs to be cohesiveness and a concentration of activities.
102Considering those factors, I agree with Barrak that distance from a central core would not of itself be indicative that a property is within a centre of activity. As noted above, there must be some geographical connection between the activities carried on. I do not regard the boundaries represented by the railway line and the transport routes including Parkes Street, or what might be regarded as gateway or entry points into Parramatta, as determinative. Whether or not the railway line and road network constitute such a separation or segmentation, that is not reflected in the zoning maps, and nor was there apparent on the view a discernible pattern in uses or built form relating to those boundaries. Based on the view and the aerial photograph provided with the Council's Statement of Facts and Contentions (exhibit 5) which shows the property together with land a similar distance from the centre of Parramatta, I accept that the area included in the Ordinary Rates Map includes a diverse range of land uses and business types, and a diverse range of built forms, and that those in the area which includes the property and extends towards the centre of Parramatta can generally be described as predominantly business or mixed use rather than solely residential use. Those uses and built forms reflect some geographical factors (such as the separation provided by the railway line), but more importantly, reflect the zoning history (which would include associated provisions such as applicable floor space ratios and height limits), and significantly, the constraints imposed by the heritage considerations including for individual items and precincts in the city centre, as well as those applicable near the property. Those uses and built forms include smaller lots, higher buildings, and intensive retail in the city centre, with much less uniformity of built form and uses away from that centre. For example, that part of Wigram Street on which the property is located has a range of similarly sized businesses and retail uses, and a two storey fire station, while across the other side of Wigram Street there is a multi-storey commercial building presently used as a storage facility. The area on the other side of the railway line at the intersection of Marion Street and Cowper Street, which is also in the Business CBD sub-category, has a mix of heritage houses, small businesses and residential uses, similar in character to the area where the subject property is located.
103I agree with the Council that there is a centre of activity with a core and middle areas and areas around the fringes. While it could not be described as homogeneous, a centre of activity need not be, and can be more diverse. In my view the property can properly be regarded as being within that centre of activity.