[2004] VCAT 260

A permit is granted and directed to be issued in relation to Planning Permit Application No. 03/0317 for the land at 2 Holiday Road, Lorne. The permit will allow:

The construction of buildings and works and the removal of native vegetation to enable the expansion of the golf course from 9 to 18 holes, the provision of new club rooms, indoor and outdoor recreation facilities and 100 group accommodation units and a reduction of the Scheme's requirements for parking, in accordance with the endorsed plans.

The permit must be subject to the following conditions:

(a) The offsets for vegetation removal generally according to the principles of Net Gain in the Native Vegetation Management Framework must be detailed, determined and provided for to the satisfaction of the Responsible Authority following consultation with the Department of Sustainability and Environment, including secure arrangements for the measures to be carried out.

(b) Amended plans to the satisfaction of the Responsible Authority must be submitted to and approved by the Responsible Authority. When approved, the plans will be endorsed as evidence of their approval. The plans must be drawn to scale with dimensions and three copies must be provided. The plans must be generally in accordance with the plans submitted with the application but modified to show:

(i) Relocation or reduction of the area of building envelopes above Hole 9 as indicated on the Lorne Country Club Master Plan dated 5 February 2003 to allow for the retention of the existing vegetation in this area to screen the dwellings.

(ii) Detailed plans for the accommodation units including siting plans, floor layouts, car parking numbers relevant to the potential separate suites in each accommodation unit and elevations with levels and heights of the buildings to AHD.

(iii) Detailed plans of the clubrooms, including siting, floor plans and elevations with levels and heights of the buildings to AHD.

(iv) Details of the tennis courts and parking areas.

(v) An adjustment to the siting of the maintenance shed to minimise its visual impact.

(vi) Redesign of Holes 3 and 4 to avoid all identified populations of Wrinkled Button plants.

(c) Landscape plans to the satisfaction of the Responsible Authority must be submitted to and approved by the Responsible Authority. When approved, the plans will be endorsed as evidence of their approval. The plans must be drawn to scale with dimensions and three copies must be provided. The plans must show:

(i) Details of existing areas of vegetation to be removed;

(ii) Details of species replanting in association with the expansion of the golf course;

(iii) Details of surface treatments and species to be planted in the vicinity of the clubrooms, accommodation units and tennis court/parking areas to help screen these buildings;

(iv) Details of fencing to prevent access into areas of native vegetation and revegetation areas.

(d) An Environmental Management Plan to the satisfaction of the Responsible Authority must be submitted to and approved by the Responsible Authority. The EMP must refer to issues raised in the Biosis report of May 2003 and include but not be limited to:

(iv) Proposed construction methods, including the provision of services to minimise the potential for damage to native flora and fauna and soil stability;

(v) Proposed treatment of disturbed surfaces on the land to ensure the mitigation of environmental impacts, including but not limited to erosion and weed invasion;

(vi) Methods to protect and preserve flora and fauna on the site during the construction and operational phases of the development. This must include a Flora and Fauna Protection Plan for the construction phase of the development. This plan should include pre-clearing inspection methods, proposed sites for relocation of fauna that do not move from the construction area at their own will, and strategies for dealing with sick or injured fauna found during construction;

(vii) A threatened species management plan for species of national and State conservation significance identified or likely to occur on the site. The plan should detail pre and post-construction actions to mitigate potential impacts, including a monitoring program to assess the effectiveness of these actions;

(viii) Methods of controlling surface run-off from access roads and driveways;

(ix) Methods of controlling weeds, pest animals and cinnamon fungus on disturbed and undisturbed parts of the site;

(x) Details of indigenous re-planting to occur on the site and around the dwellings;

(xi) Club rules for golf play that prevent access to native vegetation and revegetation areas to minimise edge effects;

(xii) Company rules to prevent the keeping of domestic animals;

(xiii) A Fire Management Plan, including how fire control will be used as a tool to manage biodiversity values at the site;

(xiv) Extent and nature of fencing of remnant vegetation;

(xv) Confirmation that any dwelling will be designed to achieve an energy rating of at least 4.5 stars;

(xvi) Measures to ensure the on-going effectiveness and review of the EMP, including the preparation of an annual environmental monitoring report that must be submitted to the Responsible Authority on an annual basis; and

(xvii) A water resources harvesting plan, generally in accordance with Option 5 in the September 2002 report of Earth Tech (page 43)with total on-site storage capacity of 20ML and greater than 95% reliability of supply.

(e) Two copies of a plan showing the architectural style of all buildings, including a schedule of all external materials, finishes and colours must be submitted to and approved by the Responsible Authority When approved, the schedule will be endorsed as evidence of its approval. All buildings and works must be constructed and maintained in materials and colours which blend with the surrounding environment and comply with the Surf Coast Design and Colours Policy to the satisfaction of the Responsible Authority.

(f) The owner must enter into an agreement under Section 173 of the Planning and Environment Act agreeing:

(i) That the dwellings on the site will be used for the purpose of tourist accommodation for at least 40 weeks of the year; and

(ii) That a courtesy bus service will be provided between the subject land and the main commercial area of Lorne to reduce traffic movement and provide access to the facilities of the site to the satisfaction of the Responsible Authority.

2 Before the use starts, areas set aside for parked vehicles and access lanes as shown on the endorsed plans must be constructed to the satisfaction of the Responsible Authority by being:

(a) Properly formed to such levels that they can be used in accordance with the plans;

(d) Line marked to indicate each car space and all access lanes;

Such areas must be maintained to the satisfaction of the Responsible Authority.

3 Landscaping as shown on the endorsed landscape plan must be completed to the satisfaction of the Responsible Authority before any building is occupied.

4 The use and development of the site shall generally accord with the Fire Management Report for the land dated 13 February 2003 prepared by George Wright to the satisfaction of the Responsible Authority.

5 The use and development as shown on the endorsed plans must not be altered without the written consent of the Responsible Authority.

Note: Any plan approved under the Building Act and Regulations must not differ from the endorsed plan forming part of this permit.

6 This permit will expire if one of the following circumstances applies:

(a) Development is not started within two years of the date of this permit;

(b) The development is not completed and the use not started within four years of the date of this permit.

The Responsible Authority may extend the periods referred to if a request is made in writing before the permit expires or within three months afterwards.

Note: Prior to the commencement of any works within the road reserve, a Council permit is required to be obtained. Permits are available from the Shire Offices. Failure to obtain a permit or to adhere to its conditions placed on the permit may result in removal of any work completed and reconstruction to Council standards. The cost of removal and reconstruction work is borne by the applicant.

7 If the driveway from the road to the dwelling and water supply, including gates, bridges and culverts, is greater than 30m long:

(a) It must be designed, constructed and maintained for a load limit of at least 15 tonnes and be of all weather construction.

(b) It must provide a minimum trafficable width of four (4) metre and be clear of encroachments four (4) metres vertically.

8 If the driveway is greater than 100m long, it must provide for the turning of fire fighting vehicles close to the dwelling, by either:

(a) The provision of a turning circle with a minimum radius of 10m;

(c) The provision of a tee-head or a Wye-head with a minimum formed surface of each leg eight (8) metres in length measured from the centre point of the head, and four (4) metres trafficable width.

9 If the driveway is greater than 200m in length, a passing bay 20m long must be provided every 200m, with a trafficable width of 6m.

10 Curves in a driveway must have a minimum inner radius of 10m.

11 The average grade must be no more than 1 in 7 (14.4%), however, an absolute maximum of 1 in 5 (20%) is allowed for a maximum of 50m.

12 Dips must be no more than a 1 in 8 (12.5%) entry and exit angle.

13 There must a be a hydrant within 120m from the edge of the building (including obstructions).

14 The swimming pool water must be available for fire fighting purposes and the swimming pool must be kept full during the fire danger period.

15 The water supply must be within 60m of the outer edge of the dwelling (including obstructions).

16 The swimming pool must be accessible for fire brigade vehicles and must be accessible to within four (4) metres of the low water mark, for drafting purposes if this is not possible, that a drafting pipe fitted with a 125mm Storz outlet fit 125mm-100mm-75mm adaptor.

17 The water supply should be readily identifiable from the dwelling, or appropriate signage must point to the water supply.

18 All below ground water pipelines must be installed to the following depths:

19 All fixed above ground pipelines and fittings, including water supply, must be constructed of non-rust material and protected from the effects of heat.

20 The vegetation management areas and specifications as indicted in the Fire Management Report for Lorne Golf Course dated 13 February 2003 (Attachment 2) must be endorsed as part of the permit.

A distance of 15m around the proposed dwelling must be maintained to the following requirements during the declared Fire Danger Period to the satisfaction of the Responsible Authority:

* There must be no elevated fuel on at least 50% of the area. On the remaining 50% the elevated fuel must be at most, sparse, with very little dead material.

* Dry native shrubs must be isolated in small clumps more than 10m away from the dwelling.

* Trees must not overhang the roofline of the dwelling.

Outer Zone distances as identified in above-mentioned plan (subject to clarification as identified above in relation to NW area)

Vegetation in Outer Zones, as specified in the Wildfire Development Plan, must be maintained to the following requirements during the declared Fire Danger Period to the satisfaction of the Responsible Authority:

* There must be no elevated fuel on at least 50% of the area.

* Clumps of dry native shrubs must be isolated from one another by at least 10m.

Note: Non-flammable features such as tennis courts, swimming pools, dams, patios, driveways, or paths should be incorporated into the Vegetation Management Plan, especially on the north and western sides of the proposed building. Features with high flammability such as coir doormats and firewood stacks should not be located near the dwelling during the Fire Danger Period. Clumps of hedges and shrubs with low flammability and/or high moisture content may be retained to act as a barrier to embers and radiant heat.

Mr Chris Canavan QC with Ms Sally Macindoe, Solicitor with Deacons Lawyers. Mr Canavan called the following persons to give expert evidence:

* Mr Andrew Rodda, Town Planner with Contour Consultants;

* Mr Chris Dance, Landscape Architect and Economist with Chris Dance Land Design;

* Dr Charles Meredith, Zoologist and Earth Scientist with Biosis Research;

* Mr Brian Haratsis, Town Planner and Economist with Macroplan Australia Pty Ltd.

Mr Chris Marshall, Senior Land Use Planner appeared for the Department of Sustainability on the first day and Mr Russell Costello of the Department of Primary Industry (which deals with vegetation under contract from DSE), appeared on the final day.

There was no appearance by the other respondent objectors. However the Tribunal has read and taken into account their submissions.

Mr Andrew O'Brien of Counsel on the first day and Mr Dominic Scally, Solicitor with Best Hooper Lawyers, on subsequent days. Mr O'Brien called Mr Craig McKiernan, Environmental Scientist and Environment Co-Ordinator for the Surfcoast Shire, to give expert evidence.

1 This was an application under Section 79 of the Planning and Environment Act 1987 (P & E Act) to review Surfcoast Shire Council's failure to grant a permit within the prescribed time to expand the Lorne Golf Course from nine to 18 holes, including removing native vegetation, constructing 100 accommodation units and redeveloping the clubrooms and recreational facilities.

2 Because the Responsible Authority had not directed notice of the permit application under Section 52 of the P & E Act, notice of the application for review was directed to be given pursuant to Section 83B of the Victorian Civil and Administrative Tribunal Act 1998 (VCAT Act). This notice resulted in two objections being received from local residents and one late objection from the Department of Sustainability and Environment. The grounds for objection focussed primarily on the visual impact of the accommodation units and the loss of native vegetation.

3 Subsequent to the application for review being lodged, the Responsible Authority considered the application and determined that it would have refused to grant a permit due to the quality of the native vegetation to be removed and a concern that appropriate offsets would be unlikely to be able to be achieved.

4 The hearing of this application took place over three days between 8 and 10 December 2003. Prior to the hearing the Presiding Member was able to inspect the subject land and surrounding areas. The parties were also advised that Ms Cullen has some familiarity with the site and surrounding area.

5 On Friday 19 December 2003 the parties were recalled and the Tribunal gave oral reasons for its decision to grant a permit subject to conditions. The following is a revised transcript of those reasons.

6 The Lorne Golf Course is located at the north-eastern edge of the township, surrounded by forest to the north and west and with housing and the town cemetery to the south. The land is elevated above much of the township and from many parts of the course there are spectacular views to the south and east across Loutit Bay.

7 It is proposed to construct new club rooms, tennis courts, a pool, gymnasium and 100 group accommodation units as well as providing basement car parking below the new tennis courts. It is also proposed to double the number of holes from nine to 18 by removing native vegetation in an essentially T shaped swathe at the northern end of the site as well as a further swathe at the site's south-eastern corner. The total area of vegetation to be removed comes to 6.1 hectares of which 1.1 hectares would only involve removal of upper canopy vegetation, thereby leaving the ground and scrub cover below. Of this, 2.6 hectares (calculated as equating to a loss of 2.2 habitat hectares) is classed as Grassy Dry Forest and is rated in the Biosis Ecological Investigation Report as having Very High Conservation Significance. A further 3.4 hectares (calculated as equating to a net loss of 2.8 habitat hectares) is classed as Shrubby Foothills Forest and is rated as having High Conservation Significance.

8 The Very High Conservation Significance of the Grassy Dry Forest Ecological Vegetation Class (EVC) is due primarily to the confirmed presence, in 21 separate locations, of the nationally threatened plant, Leiocarpa Gatesii (Wrinkle Buttons). These local populations range from five to over 400 plants with Biosis estimating a reasonable population for the locality of 3,000 to 5,000 plants. The discovery of this population on the golf course site makes this the second largest known population of this particular native species.

9 The Lorne Golf Course is zoned Public Park and Recreation under the Surfcoast Planning Scheme. The land is also affected by a Wildfire Management Overlay. Whilst a permit for buildings and works is required pursuant to the provisions of the overlay this aspect of the proposed development was not in issue.

10 In addition to the usual purpose of implementing the State and Local Planning Policy Framework, the stated purpose of the Public Park and Recreation Zone is to recognise areas for public recreation and open space, to protect and conserve areas of significance where appropriate and to provide for commercial uses where appropriate.

11 Unusually for a public park and recreation zone the subject land is not publicly owned land. We were advised that the golf course purchased the land from the Government in 1996. A restriction on the Crown grant to the golf course provides for the land to only be used for golf links and associated country club activities and other recreational purposes. By the time of the hearing there was no longer any difference of opinion as to whether the proposed redevelopment was consistent with this restriction and we accept that it is.

12 Within the Public Park and Recreation Zone a permit is required to use land for a restricted recreation facility, for group accommodation and to construct buildings and works where such use or development is not conducted by a public land manager. As the land is no longer public land a permit is required. As with the Wildfire Management Overlay provisions, these aspects of the application were not really in issue before us. The non-attending respondent objectors raised concerns in their statements of grounds over the visual impact of the development. However in the context of Mr Dance's evidence, this aspect of the development was not contested by either the Department or the Responsible Authority. Mr Dance's witness statement included suggestions for reducing the visual impact of the new accommodation units and, having inspected the land from other parts of the township, we are confident that with the incorporation of Mr Dance's amendments, an appropriate outcome is achieved.

13 A permit is also required under Clause 52.06 to reduce the Planning Scheme's requirements for car parking. Again, by the time of the hearing, this aspect of the application was not in issue. Indeed the permit applicant, with the consent of the other parties, chose in the end not to call their traffic witness.

14 What was in issue in this proceeding was the need for a permit under Clause 52.17 of the Scheme to remove native vegetation. The stated purpose of Clause 52.17 is to protect and conserve native vegetation, to reduce the impact of land and water degradation and to provide habitat for plants and animals. Throughout Victoria, a permit is required to remove native vegetation on land with an area in excess of 0.4 hectares. There are certain exemptions to this need for a permit however none are applicable here.

15 Pursuant to Clause 66.02 the Department of Sustainability and Environment is a referral authority when more than 10 hectares of native vegetation is to be cleared. As this is not the case here - the area to be cleared or modified being only 6.1ha - the DSE is not a referral authority for the purpose of this application. Rather it's inclusion as a party is by virtue of its status as an objector.

16 Clause 65 of the Scheme sets out decision guidelines that must be considered, as appropriate, before deciding on any application for a permit under the Scheme. This clause provides that the Responsible Authority and therefore this Tribunal on review must decide whether the proposal will produce acceptable outcomes in terms of the decision guidelines of (the) c_lause_.

17 Included among the stated decision guidelines is the need to have regard to the extent and character of native vegetation and the likelihood of its destruction as well as whether native vegetation is to be or can be protected, planted or allowed to regenerate. Also included, and appropriate to this application are the purpose of the zone or other provision - such as Clause 52.17 - any matter required to be considered under the zone, or other provision and the relevant parts of the State and Local Planning Policy Framework.

18 The key State and local policies applicable to this proposal are those that refer to tourism, to the conservation of native fauna and flora and to coastal areas. The State Policy provisions for tourism seek to encourage tourism in order to maximise employment and the long-term economic, social and cultural benefits of tourism for the State as a whole in both its domestic and international tourist markets. This is followed through into the Local Policy Framework with clear recognition given to the local economic and social benefits arising out of tourism associated with the Great Ocean Road.

19 Other key elements of the policy framework are the State and Local Policies referring to Victoria's coastal areas and within that the Coastal Strategy. Considered as a whole the Coastal Strategy seeks primarily to prevent or otherwise manage any further environmental degradation of the coast by encouraging development to locate within defined and manageable activity nodes or recreation zones, thereby allowing the remainder of the coast to maintain its environmental and ecological values. Within the terms of the strategy Lorne would be classed as a Coastal Township (and not as initially suggested by Mr Marshall a small coastal township) and an activity node. By virtue of the fact that the Lorne County Club is identified as lying within the urban growth limits of the Lorne Framework Plan at Clause 21.11 of the Scheme, we think it open to find that the golf course lies within an activity node under the Victorian Coastal Strategy.

20 Amendment VC19, to the Surfcoast Planning Scheme and which came into effect in July 2003, introduced Victoria's Native Vegetation Management - A Framework for Action, as an incorporated document of the Scheme. The primary goal of the Framework for Action is the achievement of Net Gain - that is a reversal across the entire landscape of the long-term decline in the extent and quality of native vegetation leading to net gain. In effect the introduction of the net gain principle constitutes a line in the sand so far as native vegetation in Victoria is concerned. It is intended that from now on native vegetation is to be controlled and managed in such a way that individual losses are always compensated for by an overall, net gain.

21 At Clause 15.9, referring to conservation of native fauna and flora it is State Policy for responsible authorities, and therefore the Tribunal on review, to have regard to the Framework for Action and if native vegetation is proposed to be removed as part of a land use or development proposal ... responsible authorities should achieve a Net Gain outcome, as defined in the Framework.

22 Relevantly also, one of the decision guidelines at Clause 52.17 is for responsible authorities to consider the goal of Net Gain as expressed in ... the Framework for Action and relevant operational guidelines.

23 The submissions in this case fall between those of the Council and Department on the one hand and those of the permit applicant. In essence it was the Council and DSE's position that because the Grassy Dry Forest EVC at this site has been rated as having very high conservation significance, clearing should not be permitted at all. Table No. 6 at Appendix 4 of Framework for Action - which provides a summary of responses and offset criteria, graded according to conservation significance - provides in relation to vegetation classed as having Very High Conservation Significance, that clearing is not permitted unless exceptional circumstances apply (ie. impacts are an unavoidable part of a development project, with approval of the Minister for Environment and Conservation (or delegate) based on considerations of environmental, social and economic values from a State-wide perspective).

24 It was submitted by the Department and the Council that this response suggestion should be taken to mean that clearing is only permissible for projects of State significance. We disagree with this interpretation as the provision does not say as much. Rather it requires an assessment of the stated values from a State-wide perspective that is to say bringing a State-wide perspective to a consideration of the costs and benefits of the project. We do say however that the drafting of this response is unclear, particularly the reference to the Minister for Conservation and Environment given that the Minister has no statutory status in any consideration under Clause 52.17.

25 The Responsible Authority went so far as to suggest that the Department's objection could be taken as confirmation that the exceptional circumstances test had not been met. We see no basis for this conclusion and, as we find later, the Department's submission in this case was very much flawed.

26 The Responsible Authority went on to say that even if permissible, a permit should not issue until an Environmental Management Plan (EMP) as well as the fine detail of how appropriate offsets might be achieved in this case, had been finalised. As already noted neither the Council nor the Department expressed concern about - and indeed the Council specifically supported - those aspects of the development other than the vegetation removal. In Mr Scally's submission the better development option, giving a win win solution all round, would be to provide for the new facilities but maintain the club's existing nine holes, thereby avoiding or negating the need for vegetation removal.

27 The case for the applicants was that the position put by the Responsible Authority was too simplistic, by virtue of its focus solely on the vegetation policy aspects of the Scheme. In Mr Canavan's submission one should have regard also to the broad suite of policy support, including the coastal strategy and seek to integrate or otherwise achieve a sensible balance between conflicting policies. Relying on the opinion of Messrs Rodda and Haratsis, Mr Canavan submitted that the Coastal Strategy demonstrated a correct approach to balancing conflicting policies. The Strategy, having weighed up the social and economic benefits of coastal tourism against the environmental impacts of unconstrained development, provides for development to occur at defined nodes rather than at places between. The strategy does not suggest that development at nodes will have no environmental impact. Rather, it finds that the degree of impact can be justified in social and economic terms provided the areas between nodes are protected. The strategy stands as an example of how conflicting policies can be balanced in favour of net community benefit and sustainable development.

28 Mr Canavan also submitted, based on Mr Haratsis' evidence, that a nine hole golf course with 100 resort accommodation units would be completely unviable and contrary to stated golf tourism policies published by Tourism Victoria.

29 It was his submission also that the Very High Conservation Significance of the Grassy Dry Forest EVC is due primarily to the presence of the second largest now known population of Wrinkle Buttons and that consistent with Step 1 of the three step process set out in the Framework for Action the proposed development had been carefully designed to avoid destruction of all so far identified Wrinkle Button plants. It does this primarily by not removing vegetation at all in some of the places where the buttons have been found and in other places removing only the tree canopy. Mr Canavan acknowledged that a further amendment to the plan would be necessary in order to avoid all known locations. This would require an alteration to the design of Holes 3 and 4, and his clients were prepared to do this.

30 A Management Plan for the Buttons had been put forward as part of Dr Meredith's evidence and it was submitted by Mr Canavan that his clients were willing and able to put this plan into effect. Similarly, it was his submission that the applicants accepted their obligation to research, find and secure a substantial net gain in compensation for the vegetation to be removed but acknowledged, as noted in the Biosis Report, that there are difficulties in achieving this in the context of the current guidelines. Most of the Grassy Dry Forest (EVC) within the Otway Ranges Bio-Region is in public ownership and not available, therefore, for off-set arrangements. That which is privately owned is already in relatively good condition, and needs to be in similar condition under the current guidelines. This means therefore, that offset improvements would require an extensive land area and, as already noted, the land area in private ownership is quite restricted.

31 It was the case for the applicants also that there is a level of inexperience across the board with implementing the net gain approach. In support of this we were referred to the Department's letter of 19 November 2003, addressed to all Councils and tendered by Mr Costello. An attachment to that letter acknowledges that application of Table 6 in the framework to decision making - which includes the response to proposal, the use of habitat hectares, detailed off-set calculations and so on - cannot be effectively undertaken until the necessary explanatory document is provided. The attachment advises that new operational guidelines are in preparation and that working through the details of the net gain process with willing proponents has provided valuable opportunities to clarify and refine issues for the operational guidelines.

32 Mr Canavan submitted, having regard amongst other things to his client's expenditure so far on environmental research and analysis, as well as on other landscape and design reports, that it would be reasonable in the present circumstances to grant a permit subject to a secondary consent condition, requiring net gain to be achieved to the satisfaction of the Responsible Authority. As submitted by him this could be made conditional also on consultation with the Department of Sustainability and Environment. The Biosis Report had recommended the imposition of such a condition although its drafting referred to the Department being the agency to be satisfied. However, as noted by Mr Canavan, because the Department is not a specified body under Section 149 of the Planning and Environment Act it would not be appropriate to make any secondary consent conditional upon it being satisfied. By not being a specified body for the purpose of Section 149, a dispute in relation to whether it could be satisfied would not be able to be reviewed pursuant to this provision.

33 Mr Canavan also suggested that any such dispute, should one eventuate, would best be the subject of mediation before resort to a review by VCAT.

34 Having described the proposal, the planning context and the nature of the submissions in this case we now set out our findings and the basis of our decision.

35 Firstly, we agree that the Responsible Authority and the Department have approached this matter in too simplistic a fashion. As provided for at Clause 11 of the Scheme we must have regard to and attempt to integrate the whole range of applicable policies and where necessary balance conflicting policies in favour of net community benefit and sustainable development. To focus on one policy outcome to the exclusion of others fails to recognise this. In this regard we accept that this proposal is entirely consistent with State and local policies for tourism which encourage development that supports the economic future of Lorne township. We also accept Mr Haratsis' evidence that 100 resort units on a nine hole golf course really doesn't cut the mustard in terms of State level tourism along the Great Ocean Road. The evidence of the lay witnesses called by Mr Canavan satisfied us also, that the upgrading of the club's facilities would have significant benefits for the Lorne community and for tourism along the Great Ocean Road.

36 The siting of such facility at Lorne is also consistent with the Coastal Strategy which provides for recreation and accommodation facilities to be restricted to defined activity or recreation nodes. Relevantly also this State level strategy acknowledges that coastal development cannot be had without some level of impact. The balance adopted by the Strategy is for impacts to occur at nodes thereby freeing the intervening sections of coast for greater levels of protection and environmental gain.

37 We accept also that the Wrinkled Buttons are the basis for the Very High as opposed to High Conservation significance of the Grassy Dry Forest EVC. It is this Very High classification that brings into play Table 6 provision discouraging clearing except in exceptional circumstances. We also accept that with some further amendment to Holes 3 and 4, that no known Wrinkled Button plants need be lost as a result of this development. We note therefore that the officer's report to Council was wrong in suggesting that the majority of Wrinkle Buttons would be removed.

38 Importantly also, the evidence, including Action Statement No. 98 for the Wrinkle Buttons and the Oberon Carter Recovery Plan for the Buttons - both of which were tendered by Mr Marshall - point to the seeming hardiness of this particular species to withstand disturbance, including by fire and track work and in the absence of or reduction of upper canopy cover. As further evidence of this we note at Appendix 5 of the Biosis Report that the Grassy Dry Forest EVC has a typical canopy cover of only 20% compared for example to 30% for the Shrubby Foothills Forest and 40% for the Shrubby Wet Forest which are also represented at the golf course and within which none of these species were found. In other words, we accept that removal of upper canopy is an appropriate mechanism for avoidance in relation to this particular species.

39 Having found that the officer's report was inaccurate in its suggestion that the majority of Wrinkle Button plants would be removed as a result of this proposal, it is relevant also to note that the Department's opposition, judging from the submission by Mr Marshall, appears to have proceeded also on a false premise, namely that the subject land is within the Otway Plains Bio-region under the draft Corangamite Native Vegetation Plan. Instead, it lies within the Otway Ranges Bio-region which has significantly more remnant vegetation than the Otway Plains Bio-region. It has 84.4% of its pre-European contact vegetation remaining compared to 31.9% in the Otway Plains Bio-region. We discovered this error subsequent to the hearing, while going through the draft Corangamite Native Vegetation Plan material provided to us by Mr Scally.

40 Contrary to Mr Marshall's submission the land is also not in a Coastal Plains Landscape under Victoria's Bio-diversity Directions in Management document, an extract of which was also appended to Mr Marshall's submission. Rather it lies within the Victorian Highlands Landscape. The suggested management responses for the Otway Ranges, within the highlands Landscape are different from the Otway Plains in the Coastal Plains Landscape. In the Plains, fragmentation, as submitted by Mr Marshall, is an issue whereas within the Ranges the issues are more to do with fire and weed invasion management.

41 The Biosis Report pointed to a possibility of other nationally significant fauna and flora on this site but found no evidence of this. We were not persuaded by the evidence of Mr McKiernan that the Biosis investigation methodology was unacceptable. If nationally significant fauna, such as the Spotted Quoll, use parts of the subject land we accept, given the current proximity to urban development and the existing fenced water storages that it is unlikely to be a nesting or breeding area. In relation to orchids we are satisfied, given the extent of investigation albeit after a dry period, that it is unlikely that a population of orchids as significant as that of the Wrinkle Buttons is present on this site.

42 Being one of the least depleted areas of the State is no basis, of course, for starting to chip away at the Otway Ranges Bio-region. However, in view of the balance set by the Coastal Strategy to concentrate developments in defined nodes, we think it relevant that the subject land is within the town boundaries of such a node. This is not to say that the Coastal Strategy would support the eradication of the second largest known population of a nationally threatened species, if such a species lay within a defined activity node. The fact is however that the proposed development does not do this. The development has sought at first instance to avoid the Wrinkle Buttons and then to minimise future impacts through the implementation of a Wrinkle Buttons Management Plan, as well through other management approaches such as specialised golf rules and codes of conduct, the adoption by the Club of a bush course image, the use of fencing, boardwalks and no go zones. All of these measures are consistent with the second of the Three Step approach set out in the Framework for Action this being if impacts cannot be avoided, to minimise impacts through appropriate consideration in planning processes and expert input to project design or management.

43 We agree with Mr Dance that this proposal has followed a design process that has relied heavily on expert input. As he put it it has not been some sort of a Johnny come lately scheme but rather a project reliant on a multi-disciplinary team approach, consistent with the Framework's Three Step approach. This multi-disciplinary team, according to Mr Dance's evidence, contributed to the decision to reduce the extent of clearance from more than 10 hectares to the current 5.0 hectares plus 1.1 hectares of canopy removal.

44 The final step in the Three Step approach requires identification of appropriate offset options. The evidence in this case showed that work has commenced but it was acknowledged that there may be some difficulty finding privately owned Grassy Dry Forest EVC's in similar condition within this particular bio-region. The like for like offset at Table 6 of Appendix 4 of the Framework provides for the loss of very high conservation significant vegetation to be offset within the same vegetation or habitat type and having at least 90% of the quality of the vegetation to be lost, giving only 10% of the vegetation quality able to be improved through management or re-vegetation. The Biosis Report at page 49 estimates, in relation to the Grassy Dry Forest EVC, that this could be achieved by managing an area of 40 hectares with an existing quality of 0.85 habitat hectares until its score was elevated to 0.95 habitat hectares. The report goes on to note

although the Otway Ranges Bio-region still supports about 95% or 275 hectares of this EVC only 20% (55 hectares) occurs on private land. Finding 40 hectares of Grassy Dry Forest in the required condition is therefore unlikely. Defining satisfactory offsets is therefore likely to require negotiation with DSE/DPI.

45 If it were not for the Wrinkled Buttons the Grassy Dry Forest EVC on this site would rate as High Conservation Significance rather than Very High. In such cases Table 6 at 4 provides for offsets within the same or another more significant EVC in the same bio-region rather than the same EVC in the same bio-region.

46 The Framework is however a guideline and not a statutory rule and as already acknowledged it is early days in the operation of net gain, with the Department still working on the operational guidelines referred to at Clause 52.17. Given the particular circumstances of the subject EVC there could well be value, we suggest, in pursuing net gain in other more targeted ways especially in view of the fact that the significance comes from the Button population. Having heard Dr Meredith's evidence we question the benefit of achieving a net gain as per Table 6 of the Framework that is, by undertaking what in effect would be only modest improvements to privately owned and mostly undepleted Dry Grassy Forest within this also mostly undepleted Otway Ranges when there may be more significant gains to be achieved in other places where the Wrinkle Button is more vulnerable. We agree with Mr Canavan also that there could be value and certainly there is a nexus, for any net gain package to include a contribution towards research into this particular species. We note that the recovery plan for the Buttons, attached to Mr Marshall's submission and prepared for the Australian Natural Heritage Trust by Mr Oberon Carter, proposes a five year recovery program for the species at an estimated cost of $360,000 over five years between 2004 and 2008. It is difficult to ignore the possible synergies between that research and the proposed development.

47 Having regard to the particular circumstances of this case we have come to the view that it would be appropriate to grant a permit for the vegetation removal and other matters, leaving the specifics of any net gain options and an EMP to a future and secondary decision making process. In coming to this conclusion we have had regard to the newness of the net gain provisions and the clear understanding by the Department, per its letter of 19 November 2003, that it is still working through the details of the net gain process. We are satisfied that the proponents have a clear commitment to work with an independent and expert multi-disciplinary team in order to find responsible and responsive off-set options.

48 While we accept the benefit of a permit being tied down as far as possible, we do not agree that a secondary consent provision is inappropriate in this case. We are confident that an appropriate offset package can be negotiated but acknowledge that its formulation may require some creative and lateral thinking. We are confident also, having regard to the nature of this proposal that the provision of an offset package would be unlikely to conflict with other aspects of the approved development or otherwise cause the provisions of the permit to become internally inconsistent and difficult to implement. We acknowledge that this can sometimes occur in relation to secondary consent conditions but are not persuaded that it is likely here.

49 The grant of a permit subject to a secondary consent condition also leaves open the option of a review to VCAT, in the event of disagreement over the offset or the EMP details. Should such a dispute arise, a review hearing would provide the opportunity to call and test evidence relevant to the particular suite of offsets or management plan details that had been developed. We were not in a position to be presented with that evidence in the current proceeding. Also in such a review, and despite the fact that the Department is not a specified body under Section 149 of the Act, the Minister has the option of calling the matter in or otherwise making a submission if she considers that the matter raises issues of State significance.

50 A further issue raised was that of the security of any net gain arrangement. We are reluctant to spell out the details of such an arrangement at this stage, not knowing the nature of the package to be pursued. We have chosen instead to require any net gain package to be to the satisfaction of the Responsible Authority. Accordingly the Responsible Authority would not be prevented from requiring a covenant or a Section 173 agreement as a means of being satisfied in relation to the securing of the required offsets.

51 We also say by way of conclusion, that had this proposal been for a site outside of the defined township boundary or for a development deriving less community benefit - for example a small housing development at the edge of town - or had it been located in a more depleted bio-region, we may well have said no to the grant of a permit. However, because of the development's clear benefits for the Lorne community and to tourism on the Great Ocean Road and given the avoidance mechanisms to be adopted and our confidence that appropriate offsets can be negotiated, it is our conclusion that the development as a whole will result in an appropriate and sustainable outcome in terms of the Schemes decision guidelines and one that can provide a net community benefit.