Merimbula Nominees Pty Ltd v Bega Valley Shire Council

Environmental Planning and Assessment Act 1979 State Environmental Planning Policy No. 11 - Traffic Generating Developments Lower South Coast Regional Environmental Plan No. 1 LEGISLATION CITED: Lower South Coast Regional Environmental Plan No. 2 Bega Valley Local Environmental Plan 2002 Development Control Plan No. 7 - Car Parking Development Control Plan No. 30 - Merimbula Height Controls Development Control Plan No. 38 - Merimbula Commercial Centre

CASES CITED: Stockland Pty Ltd v Manly Council [2004] NSWLEC 472

DATES OF HEARING: 02-03/11/2006 and 26-27/02/2007

APPLICANT Mr P Larkin, SC Instructed by: Ms R Spiegel, solicitor Of: Spiegel & Associates LEGAL REPRESENTATIVES: RESPONDENT Mr P McEwen, SC Instructed by: Mr M McMahon, solicitor Of: M E McMahon & Associates

JUDGMENT: THE LAND AND ENVIRONMENT COURT OF NEW SOUTH WALES

10394 of 2006 Merimbula Nominees Pty Ltd v Bega Valley Council

JUDGMENT 1 This is a class 1 appeal against the deemed refusal of consent for a supermarket and carpark at the front plus basement carparking for a total of 284 cars at Lot 2 DP 54333 and Lot 1 DP 375333, Main Street, Merimbula.

2 The site is vacant, but used as a carpark for the adjoining Merimbula - Imlay Bowling Club. It appears also to operate as a carpark for the existing shopping centre.

3 The land has about 76 m frontage and 100 m depth and is approximately rectangular. It slopes up northwards from the street about 3 m along its length. Along with the bowling club on the west and council buildings on the east it is on the top of a ridge. At the north-east corner of the site at the rear there is a steep slope downhill to vacant land zoned Residential 2(b) that fronts a wetland/lagoon on the north of the township. The rest of the zone 2(b) land north of the site and north of the bowling club is also on the ridge top and used also as a carpark.

Proposal as described by the application (later modified) 4 The proposal seeks approval for the development of a Woolworths supermarket and associated car parking and landscaping. This proposal will replace the existing Woolworths supermarket located on the southern side of Main Street opposite the site.

Proposed Use 5 The proposed Woolworths supermarket has a total gross floor area (GFA) of 4020 sq m and is located at the north end of the site. In addition to the retail space, the proposed development incorporates the following features: o Total off-street car spaces of 288 (80 on-grade at the front of the supermarket and 208 spaces in the basement). This includes 127 car spaces for the RSL. o Two loading docks designed to cater for both for trucks and delivery vans. o Amenities including toilets, parenting room, travelator and passenger lift, and o Centre management office, plant and amenities on a mezzanine level (100 sq m). Access, Parking, & Loading

6 The principal vehicular access to the proposed development will be from Main Street. The car park will comprise two dual ingress/egress locations onto Main Street. 80 on-grade car parking spaces are located in the front building setback and accessed directly off Main Street. This is inclusive of two disabled parking spaces located at the main entry to the Woolworths store.

7 In addition to the car park at grade level, the development incorporates a 208 space basement car park with entry via a ramp on the western boundary of the site. From the basement car park, customers will access the centre via travelator located on the eastern boundary of the site. A passenger lift beside the travelator will provide access for aged people or people with disabilities.

8 All dimensions are equal to or exceed AS2890.1 recommendations.

9 The loading dock is located on the eastern side of the site. Ingress/egress is proposed via the proposed vehicular access points from Main Street. The loading docks have been designed in accordance with the required turning circle paths and all service trucks will be able to travel in a forward movement.

10 A bicycle lock-up point will be able to be accommodated at the entry to the Woolworths Store and are indicated on the site plan.

Landscaping 11 The proposal incorporates landscaping along the Main Street frontage and within two raised planters in the car park. The proposed species are plants local to the area. Materials and Finishes 12 Essentially the development will comprise a range of materials from textured concrete with masonry finish, recessed concrete panel with textured paint finish and timber screens that will help create a visually interesting facade and relief to the building elevations. The southern elevation, fronting Main Street, incorporates aluminium glazing and a stone cladding entry feature.

13 A range of natural 'coastal' tones have been selected to cerate a high quality external finish and integrate with the preferred colours of Merimbula township. The sandy yellows and soft blues which reflect the water have been incorporated into the design of the building to reflect the seaside location of Merimbula. Hours of Operation 14 The proposed development will operate from l am to midnight, seven days a week. Proposed Delivery Vehicles 15 The proposed delivery times will occur between 6am to 10pm, seven days a week. Indicative truck movements and unloading times at this stage are not known. END APPLICANT'S DESCRIPTION.

Applicable Statutes and Controls o Environmental Planning and Assessment Act 1979 o State Environmental Planning Policy No. 11 - Traffic Generating Developments o Lower South Coast Regional Environmental Plan No. 1 o Lower South Coast Regional Environmental Plan No. 2 o Bega Valley Local Environmental Plan 2002 o Development Control Plan No. 5 - On-Site Sewage Management o Development Control Plan No. 7 - Car Parking o Development Control Plan No. 8 - Contaminated Land o Development Control Plan No 30 - Merimbula Height Controls Zoning

16 The site is zoned 3(a) General Business Zone under the Bega Valley Local Environmental Plan 2002.

17 The objectives of the zone are: a) to encourage a high standard of commercial development, create compact business centres which service the population and visitors and facilitate the expansion of business activities in appropriate locations,

b) to set aside certain land for the provision of services required by the travelling public for the development of facilities for refreshment, accommodation, recreation and amusement,

c) to permit non-commercial development where such development complements the intended commercial development. The Issues 1 (a) Whether the development should be approved as the development does not comply with the aims in Clause 2(a) of the Bega Valley Local Environmental Plan (LEP) being to ensure a balanced approach to development which is sensitive to both the economic and social needs of the community. (b) Whether the development should be approved as the development does not comply with the principles in clause 65(1)(a)(xiv) of the LEP being traffic generation and appropriate vehicular access into and around the site. Particulars: A. The development will contribute to and exacerbate existing traffic problems including safety, congestion, and conflict between service access and shopping traffic, conflict between pedestrian access and shopping centre. B. The grades of the vehicle access ramps to the underground car park are excessive and would increase the potential risk for pedestrian and vehicle conflict. C. Volume of traffic generated by the development is unacceptable for Main and Market Streets in particular and for the traffic flows in Merimbula in general. D. The site is considered too constrained for safe manoeuvring of larger delivery vehicles. 2. Whether the development should be approved as there is non-compliance with clause 65(1)(a)(v) of the LEP being the topography and setting of the land and (vi) being the streetscape character of the locality. Particulars: There will be unacceptable overshadowing impacts by the proposed development, particularly there will be overshadowing of the adjoining Merimbula Imlay Bowling Club's eastern bowling green. 3. Whether the development should be approved as there is non compliance with clause 65(1)(a)(ix) being the energy efficiency of the site and any buildings on the site and (xiii) the treatment of stormwater prior to discharge or the use of stormwater. Particulars: The design is environmentally insensitive in relation to wastewater, rainwater, and energy saving devices. 4. Whether the development should be approved because of its non compliance with clause 65(1)(a)(vii) of the LEP being compatibility with the scale and design of neighbouring development and clause 30(2)(a) being an objective of the Zone 3(a) being to encourage a high standard of commercial development, create compact business centres which service the population and visitors and facilitate the expansion of business activities in appropriate locations. Particulars: A. The bulk and scale of development would be out of character with adjoining developments. B. The proposal does not comply with the Council resolution of 26 April 2006 which resolved to exhibit an amendment to LEP 2002 to limit the size of shops and commercial premises in the Merimbula 3(a) zone to 2500 sq m or less. C. The scale of the development is inappropriate for Merimbula and will compromise the objectives of the South Coast Regional Strategy and Council's exhibited draft Commercial Centres Strategy. D. Council is not satisfied that the material submitted with the development application has proven compliance with the requirements of the Regional Development Committee. 5. Whether approval will compromise the South Coast Regional Strategy and Council's exhibited draft Commercial Centres Strategy. Particulars: A. Council's exhibited draft Commercial Centres Strategy clearly presents alternatives for supply of adequate supermarket facilities for the Merimbula area with an adequate site being identified at Tura and with the development of wider regional scale facilities being proposed for Bega as a single logically planned regional centre. B. Approval of the development in this location could in turn lead to further intensification of major retail floorspace in the area with the possible provision of a discount department store. Such development would further compromise and contradict the proposals put forward in the South Coast Regional Strategy and in Council's exhibited draft Commercial Centres Strategy. 6. The proposed development would not be in the public interest due to nearly 600 objections to the proposal.

The Evidence 18 The respondent's evidence was heard from: * Mr A Constance, Member of the Legislative Assembly of NSW; Member for Bega; Shadow Minister for Disability Services, Shadow Minister for Ageing, 122 Carp Street, Bega. * Councilor F Buchanan of Bega Council, Lot 7 Franks Road, Pambula. * Ms S Roman volunteer at St Vincent de Paul Society. Merimbula * Mr R Hayson President Bega Chamber of Commerce. * Mr P McManus, Old Tathra Road. * Ms C Bugden, "out of town" resident. * Mr W Page, Cross Street, Bega * Mr G Wykes, a trader in Market Street, Merimbula * Mr K. Walsh, 28 Tura Beach Drive. * Mr R W G Dove, retired barrister, 8 Bournda Circuit, Tura Beach. * Mr F R Mallett, retired bank manager, 9 Idlewild Crescent, Pambula. * Mrs M Moulton, current President Merimbula Chamber of Commerce, Lot 1 Turingal Head Road. * Mr B Harrison, owner/operator Waterview Apartments, Arthur Kaine Dr, South Merimbula. * Mr C Wilkinson, 5 Randolph St, Merimbula, retired valuer. * Mr J Coady consultant traffic engineer * Mr G Barry council's Director of Town Planning * Mr P J Astbury, council's traffic engineer.

19 The applicant's evidence was heard from: * Mr J Tait 50 Tantawanglo Street Merimbula * Mr J Rawlings, Tura Beach. * Mr A Llewellyn a former President of Merimbula Chamber of Commerce. * Ms S Gearin, 8 Northview Drive, South Pambula. * Mr J D Higgs, consultant traffic engineer. * Mr R Fakery, architect for the proposal. * Mr S G Paterson, 2 View Street, Merimbula withdrew his objection by letter dated 2 November 2006, saying Merimbula needs a larger supermarket because the existing Woolworths and Bi-Lo are regularly emptied of stock by locals and tourists. But any new supermarket on the subject site should be serviced from the rear through the carpark of the bowling club, not off Main Street. 20 To explain, the bowling club has the subject site on its east and uses it as a carpark. There is more land behind the bowling club and the subject site on the north that is also used as a bowling club carpark and is accessed from Sapphire Coast Drive. I was told the members of the bowling club had taken action to prevent its Board negotiating with the applicant.

21 The parties had agreed to have a joint expert on town planning, and in that position the Court should appoint Ms D Laidlaw, consultant town planner. She had produced reports in Exhibit 6 and gave oral evidence and was cross-examined.

22 I note that many of the objectors to the proposal and some of those in support gave their oral evidence on site. While both parties tendered notes taken at the time, giving the persons' names, addresses and main points in Exhibit M, the handwriting made it difficult to decipher, so there may be some inaccuracies in the listing of names and addresses. There were about 600 formal objections tendered in Exhibit 3 as a result of council publicly exhibiting the proposal.

23 Ms Gearin produced an informal set of over 700 signatures in favour of the proposal that staff had taken at Merimbula Woolworths. The respondent submitted and I agree that the latter signatures could not be given the same weight as the formal objections. Ms Roman testified that she was at Woolworths and had felt bullied to sign, but had refused.

24 Mr Constance drew the Court's attention to the draft state policies for the region and public consultation that had occurred. He was particularly concerned about the serious lack of planning for traffic management in Merimbula. He recognized that there were many different opinions about what should be built on the subject site and the result was this appeal. Tourism is a major industry in the south coast and the retention of its popularity and management of its future is very important, he said.

25 The formal objection letters to Council were nearly all in a standard format listing the following points: i. There has been no public consultation from you for a major development to the residents and ratepayers, after Council's own stated position was for low-key development in the CBD. ii. The traffic that will be generated by this development has not been adequately provided for, due to the congestion that is already in Main Street. iii. It is directly opposite to a statement made by Mr Barry ( sic. council's town planner ) on future development in Merimbula as stated in Merimbula News on Jan 11/06. iv. The actual plans and development proposal has not been fully and properly submitted. v. The said document is flawed by use of information gleaned by outside sources that bear no relevance to this Merimbula proposal. vi. The information that is used to justify conditions, usage and requirements, particularly the traffic assessment that was done on one day (the 17th March, a Thursday in 2003) are too old to be credible. vii. I support the alternative proposal at Tura Beach and request it be rezoned to allow it become a Supermarket and Shopping complex as there is a much larger area available that would alleviate the problems of traffic flow and car parking and semi-trailer delivery access. 26 The supporters of the proposal made the following points: i. The existing supermarkets in Merimbula are overtaxed, a larger one will give better shopping and get delivery truck manoeuvring off Main Street. ii. The majority of permanent and tourist populations live in or near Merimbula, sending them to Tura or Bega to do supermarket shopping is impractical. iii. A new supermarket in Merimbula will not threaten the Regional Centre role of Bega. iv. Additional employment will result from the proposal. v. The 127 carspaces required for the bowling club will be provided on the subject site in addition to those required for the supermarket. vi. The traffic congestion in Merimbula is not a consequence of this proposal, it is a long-existing problem that the RTA and the council have failed to act upon, and this development should not be penalised. The proposal is located in Main Street and the congestion occurs on the through-town route of Market Street-Merimbula Drive-Sapphire Coast Drive. vii. The traffic congestion only occurs in seasonal peak tourist times. viii. 600 objections are more than balanced by the silent majority who would use a better shopping facility. 27 Additional points made by objectors who gave evidence in Court are: a) During the years before this Hearing, there has been extensive public consultation on the future of the Bega Valley and coastal areas. The first draft Commercial Centres Strategy began in August 2004, and was exhibited in February 2005. Since then, the public Will reflected by the council, and now by State policies are that Bega is the Regional Centre, and must be reinforced in that role by encouraging new major development there, and the tourist towns must be carefully managed to retain their role as population growth there could de facto subvert Bega. b) The character of the coastal areas is what draws the tourists, they don't come here to shop. The protection of the small scale character of coastal towns is important to maintain and increase tourist visitation. The advent of "big box" shopping complexes is contrary to that character as it starts to look like the cities and suburbs that the tourists are escaping from for a holiday. The charm of the town starts to disappear. c) Main Street is an old 66 foot wide street laid out originally for houses. It is the only access street to the east of Merimbula where the schools and emergency services and many houses are. It is the only access street to the Council, the library and the day-care centre and the bowling club and main bus stop that are all next door to the proposal. All these generate considerable traffic in Main Street, and might be considered "essential services". d) Opposite the proposal is the existing Woolworths that has major traffic problems with its loading bay, and those problems will remain. (i) On the day of the hearing a delivery truck was seen to reverse into it and having to manoeuvre on the street to do so. The on-street manoeuvring usually is much more obstructive to traffic and pedestrians because trucks do not often use the loading bay.

(ii) This is due to the ramp down into the bay that puts modern day pallet trucks on a slope and the pallets can move dangerously. So they park parallel beside the building up next to the public footpath at the street level and a forklift is used to unload them. (iii) Currently trucks often queue in Market Street waiting to access the Woolworths to unload. Up to three in a row have been seen. This blocks traffic and parking. Residents have counted and the Merimbula Woolworths manager admits there are up to: 6 to 8 semi-trailers per day. 10 to 15 rigid trucks per day. 10 to 15 vans per day. (iv) The existing supermarket the applicant says will be replaced by the new supermarket. But they omit to say the existing building is to remain and obviously will be used for something else. So the existing congestion on Main Street will CONTINUE and the new supermarket will ADD more.

(v) The excavation to bring the ground floor level and above ground carpark down to the same level as Main Street, plus the excavation for the basement had been calculated at about 8000 truckloads, and for construction about 2000 truckloads all via Main Street. e) In peak congestion Market Street to the bridge at the south end of town and across it to Arthur Kaine Drive, and north through town up Merimbula Drive and Sapphire Coast Drive are all traffic jammed with more than 2 km long lines of traffic. Main Street gets the overflow from that because it runs parallel to part of Merimbula Drive and connects Market with Sapphire Coast. Combined with its own traffic generators Main Street blocks up. The only traffic surveys done date back in 2003, the Council Traffic committee and the Regional Traffic Committee have both asked for new traffic counts but the applicant has never provided them. f) The narrow width of Main Street and the current pedestrian refuge opposite Woolworths works only with minimal safety. (i) Trucks coming out of Woolworths swing so close to the refuge, and trucks and cars moving along Main St come so close to it that pedestrians are only inches away. Existing semi-trailer parking on the street up to the minimum setback from the bowling club drive entry make sight safety distances impossible for drivers exiting the carpark, and forces passing cars over to the centre of the road and the refuge.

(ii) Some of the trucks park down at the Main/Sapphire Coast intersection and cause similar obstructions there. More traffic will increase the danger in these positions.

(iii) Due to existing danger the police have approached Woolies to hold trucks out of town so only one comes into Main Street at a time. This was carried out by Woolies for a time, but no longer. Delivery truck management is poor. g) The Merimbula Chamber of Commerce is fully supportive of the South Coast Regional Plan, The Commercial Centres Strategy, the adopted DCP for Merimbula and the draft LEP to limit any shop floorspace to 1000 sq m maximum, as well as the council's opposition to the proposal. It has sent council its own petitions against the proposal and in support of a supermarket at Tura Beach where the population is expanding and needs its own supermarket. That will reduce traffic in Merimbula going to the existing Woolies supermarket and reduce its being overtaxed, and preserve the tourist oriented commercial and retail outlets and the desired small scale character of the township. 28 Mr Wilkinson said he retired from Melbourne to Merimbula because of its attractive character and surroundings. He did not think tourists wanted to leave Melbourne and holiday in Merimbula to suffer gridlock. He thought good town planning was about the management of growth for the benefit of all. Greater Merimbula extends 8½ km north and 7 km south, and it is growing and needs another supermarket, but not here. The topography and waterways are what create the character of the town, and also create the constraints that restrict traffic and make it very difficult to fix the congestion. At the moment Merimbula has about 10 weeks per year of awful parking and traffic overload. It is bad fundamental planning to add to it.

29 Councilor Buchanan outlined the council's strategic planning process:

30 The first draft of the commercial centres policy was August 2004, exhibited Feb 2005 together with a Merimbula Centre draft DCP. The latter was subsumed by the centres study.

31 In the process, council had a company Market Matrix from Melbourne, do a survey of what people wanted in Merimbula regarding bigger centres or not, and traffic solutions. The result was 73% against "big box" shopping centres in coastal towns, 13% undecided and 8% in favour of bigger centres.

32 Public meetings supported that result with critical issues being: no more development until traffic congestion fixed, and any new large retail developments to be out of town.

33 The second draft of the commercial centres study was June 2005. Council preferred Bega for any new large retail developments as it was central, has infrastructure and the land space, and needs boosting.

34 Development applications and inquiries for 5 new "big box" retail shops came into council, 2 in Merimbula, 1 in Tura and 2 in Bega. There were workshops and public consultation. The Merimbula Chamber of Commerce announced it did not want a "big box".

35 State Department of Planning pressed council in December 2005 for a draft strategy to co-ordinate with the draft Regional Plan. The council resolved a draft strategy of no "big box" in Merimbula and a smaller development in Tura. A motion for a rezone of more commercial land in Tura was carried to enable that to happen. An option for a big centre in Merimbula was defeated.

36 The application for the proposal came into council between Dec 2005-Jan 2006 and was exhibited initially for 14 days only. The time was extended. The 600 objections came in.

37 Council moved forward on its draft strategy with another workshop/public consultation late Feb 2006 and again supported Tura rezoning and put a cap of 2500 sq m on any new retail outlet in Merimbula.

38 Traffic jams in Merimbula including the trucks in the shopping centre has gone on for 15 years to Councilor Buchanan's recollection. The topography of the shopping centre being on a narrow peninsula between the harbour and the lagoon to the north is a major constraint. The main road south comes across the Merimbula Lake bridge onto the peninsula, goes through the shopping centre and out to the north-west. The steep hills make a bypass impossible. In any case a highway bypass has been built from Pambula west of Merimbula Lake, so through-traffic has already been diverted and the town still gets 2 km of gridlock at peak times.

39 Councilor Buchanan said in his opinion the new residential areas of Mirador and Tura Beach to the north of town along the Sapphire Coast Drive are now equal in permanent population to Merimbula. The population projections in the economic and planning studies were based on pre-2001 growth rates; he believed the northern areas had accelerated since then. They have a neighbourhood centre and a mini-market, but better services are warranted. A new major supermarket in Merimbula would forestall better services in Tura for 10 years or more.

40 The councilor said the SGS Economics study for the centres policy showed a 15% impact on Merimbula if Tura went ahead, but he considered that would only effect the two existing supermarkets and stop them being overtaxed, and reduce traffic in the shopping centre. The tourists support the specialty shops/boutiques/restaurants in Merimbula, and they would be unaffected.

41 Merimbula sewerage is at capacity, by contrast Tura Beach has ample sewer capacity. He expects new residential land releases to occur there because land to the west of Sapphire Coast Drive has topography suitable for urban development. The steep hillsides and waterways at Merimbula do not allow expansion. At Tura, a larger supermarket is needed now and for the future. The councilor added that white goods outlets in Merimbula have trouble getting deliveries due to the traffic and could better serve their markets if moved to Tura.

42 I asked for the latest Census data to show population in the north equal to Merimbula, but was told it is not available until mid-2007. I asked for council resolutions or master planning for expansion of the residential capacity of the Tura area and was told there have been none as yet.

43 On the recent progress of the statutory legislation and controls, the councilor said in all over 22 months, the council had carried out 3 surveys each showing about 70% of people opposed "big box" retail in Merimbula, and council had work-shopped the commercial centres policy in public meetings 4 times. It was expected that the final South Coast Regional Plan would be gazetted soon. The council had asked for a s 65 certificate from the Dept of Planning to exhibit a draft LEP amendment to limit floorspace of new retail outlets in Merimbula to 1000 sq m; council had adopted a new DCP to impose the same limit.

44 It was put to him that the population projections showed that even at full development Tura Beach/Mirador would only be about half the total of Merimbula. He agreed with that based on existing zoned urban land, but with the migration of new residents to the area, he maintained that the northern areas were close to the year 2025 projections now, and the continued pressure of migration would cause new areas to be rezoned.

45 It was put to him the anchor of any shopping centre is its supermarket, and if Merimbula did not have the proposal, and Tura is expanded, all the shops in Merimbula would suffer. He said that Merimbula's anchor is tourists and the 150 tourist oriented small scale shops and the character of the township. Only supermarket turnover will be reduced in Merimbula, if Tura is expanded.

46 Mr Fakery explained the amended plans in Exhibit G. The applicant had modified the plans to deal with some of the observations of Ms Laidlaw. The building was moved 2 m from its north boundary to allow some screen planting to soften the building as seen from Mirador and Sapphire Coast Dr on the northern side of the lagoon, and to provide a buffer to any future development on the zone 2(b) Residential land next to the site. The height of the basement wall required due to the slope in the north-east corner of the site was shown correctly and the height of the whole building reduced so, now it complies with the 10 m height limit. Ms Laidlaw had criticised the architectural treatment of the original design saying: ( sic. Even after the lowering of the roof and parapet) The lower parapet/roof line and facades should be articulated so as to avoid a long horizontal plane appearing on the ridgeline. This is a matter for the architect, however I would suggest that the overall length of the roof be articulated with a variable parapet (incorporating perhaps some lighter parapet forms) to provide the impression of a number of smaller buildings, rather than one long building. The elevations should better reflect a retail, rather than industrial/commercial character and a more obvious effort needs to be made to reflect the `small coastal town' character of Merimbula. Despite the comments in the statement of environmental effects that this locational circumstance has guided the architecture, I find it difficult to see how this is the case.

47 Ms Laidlaw said the treatment of the amended design in Exhibit G had addressed this criticism and it was now acceptable. She said also that the overshadowing of the bowling green was minimal and acceptable.

48 The respondent, as a result, did not press Issue 2 or Particular A of Issue 4. No substantial evidence was brought by the respondent in regard to Issue 3. The development incorporated a rainwater detention system and council provided a draft condition in that regard in Exhibit 10. There were no draft conditions regarding wastewater recycling and energy saving devices, and no evidence of any deficiency for determination.

49 Therefore the determinative issues became Issues 1, 4(B)-(C)-(D), 5 and 6.

50 It became clear at the hearing, there were some other elements not shown on Exhibit G, such as the travelator from the basement referred to in the Statement of Environmental Effects. Now it appears on the plans to be a fixed ramp. The office area is not a mezzanine but a second floor and a projecting stairwell was not shown. Three (3) metre high retaining walls against the common boundary with the bowling club were not shown, nor was a 1.8 m fence on top. The landscaping drawings did not match the traffic engineer's carpark layout.

51 At the second sitting of the Hearing further amended plans were tendered in Exhibit O showing these matters. Also changed was the door to the basement carpark that was previously shown at the foot of the car ramp at the basement level. It has been moved up nearly to ground level, so most of the ramp is internal to the building. Also a revised carpark layout to accommodate truck maneuvering reduced carparking above ground to 78 and basement 204. A further plan to satisfy Mr Coady was attached reducing above ground carparking to 71, and basement 210. Mr Coady's plan allowed separation of customer carparking and on-site truck maneuvering. Both plans were said to comply with council's controls.

52 Ms Laidlaw was not present at the second sitting and had not seen Exhibit O. She was aware of the draft South Coast Regional Plan, the draft DCP and draft LEP to limit any individual shop in Merimbula to 1000 sq m floorspace.

53 She said (quote): A number of State and local policy documents apply and are relevant to the issues raised by Council, including the Draft South Coast Regional Strategy and Council's draft Commercial Centres Strategy.

This issue is raised, or referred to, in Issues 4 and 5, and indirectly, in Issue 1. The substance of the concern appears to stem from a resolution of Council dated 26 April 2006 (post dating the submission of the development application) to the effect of limiting the scale of any retail development in Merimbula to 2,500 sq m (the proposed development is around 4,000 sq m). The basis of the resolution appears to stem from a concern that Merimbula should retain a coastal tourist village' feel and that a large supermarket would be inconsistent with this character. Related to this, are traffic concerns (congestion, safety, convenience), which are already apparent on Main Street, but which the Council and members of the community believe would be exacerbated by the development. Also, there is a body of opinion that it would be preferable to locate a larger supermarket at Tura Beach, a smaller coastal settlement located a short distance to the north and/or to concentrate larger scaled retail facilities at Bega. The submission that a supermarket be redirected to Tura Beach appears to arise partly from a desire to improve services for that community (which currently only has a limited range of shops, including a small 'IGA' store) and partly to relieve traffic pressures on Merimbula by spreading the traffic load'. The resolution has not, as I understand, been incorporated into any draft or gazetted local environmental plan nor any draft or adopted development control plan. It has, though, as I understand, been incorporated into version 3' of Council's draft Commercial Centres Strategy……………………., it seems that the shopping area of Merimbula falls into two main precincts : * Market Street, which is dominated by smaller shops and eateries, including some that interface with the waterway and boardwalk. The development here is generally two storey and of very modest scale and despite quite heavy traffic flows there is a greater emphasis on the pedestrian environment, as reinforced by streetscape improvements; and * Main Street, which has a greater number of larger scaled buildings, including the existing Woolworths, the Bowling Club, the Council community center, and Best and Less' store……………. Market Street and Main Street represent the two core' areas and as noted above, each of these has a different emphasis: Market Street seems to be evolving as more of a boutique' environment of specialist shops and eateries extending out to the boardwalk - a place where shoppers might linger and browse'; while Main Street has a more 'utilitarian shopping/service feel' including the dominant 'convenience' shopping of Woolworths (a smaller supermarket is located in Market St ) In my opinion, the location of a large supermarket on Main Street is consistent with this order' of retail function and activity already established within Merimbula, and which forms a logical basis for the future evolution of the center. I do not believe that a large supermarket would significantly impact on the coastal tourist village atmosphere that is valued by Council and residents, because Market Street and the road and access ways connecting to it seem to be the more natural' choice to form a focus for that role. The larger buildings and locational attributes of Main Street do not readily convey a visual association with a coastal village' and it is unlikely that this situation will change in the foreseeable future. Moreover, given that the town serves the needs of the permanent residential community as well as the visiting community it is appropriate, in my view, that the `feel' of the town continues to reflect both of those equally important roles - it is not simply a tourist destination but a district center serving day to day needs as well.

……………….State government policy arises in the form of the policy package Integrating Land Use and Transport', including Draft State Environmental Planning Policy (SEPP) No. 66' and its supporting policy package. Draft SEPP 66 does not, however, apply to Bega Valley Shire (Clause 5 Where the Policy applies') however the supporting policy ('the Policy') The Right Place for Business and Services' applies to urban areas across the State'. The Policy incorporates the aim businesses and services which generate transport demand should be in locations that offer a choice of transport and encourage people to make fewer and shorter trips. Dispersed locations cannot be accommodated without significant community and environmental cost'. This philosophy represents the latest version' of a generally consistent State government policy that has been in place, in one guise or another, for nearly two decades. It has, as a central theme, the aim of supporting an established retail hierarchy with objectives of ensuring equity of access to goods and services and - as particularly emphasised in this latest Policy - the aim of promoting the concept of travel demand management'. The Right Place for Business and Services' promotes the intent that trip generating retail activity should be located in established centres, except where an alternative can be justified having regard to the net community benefit. It notes that supermarkets and large specialist and department stores have an important role in anchoring a broad range of shopping and other services, thereby allowing single, multipurpose trips. Retail proposals should be accommodated in centres to allow choice and free pedestrian movement. Ideally a single retail property should not comprise the whole of the centre so as to allow for new market entrants and competition and avoid the unnecessary creation of new centres. ...' As I have noted, this has been a consistent approach of the Department of Planning' for many years, due to the significance of retail activity to the community and economy, and the need for regulation of it, in the interests of State and Regional planning. I would expect the Department of Planning to apply the principles of The Right Place for Business and Services' in the event of Bega Council submitting for its endorsement (eg under Section 65 of the Act) any proposal to amend its planning instrument(s) to the effect of altering policy as to the location and scale of significant retail development. Guidance on the right centres' applicable to Bega Shire can then be obtained from the Draft South Coast Regional Strategy'. This document identifies (Section 7) that Council based mechanisms or controls shall be identified to preserve and support the hierarchy of commercial centres for the South Coast Region as follows ...'. Bega is identified as an emerging' major regional centre and Merimbula is identified as a Major town', described in the following terms existing smaller [ie compared to major regional centres'] identified for a lesser proportion of growth. Shopping and business centre for the district including warehouses, transport logistics and bulky goods operations, health and professional services mixed with medium density residential'. To complete the picture, Tura Beach, which Council has mooted as an alternative proposition for location of a larger supermarket, is not identified as a Major town' and would logically be described (as nearby Pambula is) as a town', or perhaps even as a village'. The policy for towns' is `small centres that vary in size. Small to medium concentrations of retail, health and other services with lower density residential. Reliant on higher order centres for shopping and employment'.

I have inspected the local centre at Tura Beach. It supports a small IGA store, and a limited range of local convenience shops and services. It is clearly a lower order centre of a scale suitable to meet neighbourhood' as opposed to district' needs. Between the two, the obviously more appropriate location for a large supermarket (in terms of consistency with the Policy and draft South Coast Regional Strategy) is Merimbula, because this centre: * is identified as a Major town' in the Strategy; * clearly provides a range of goods and services, consistent with that status; * also supports a tourism role, and includes medium density development closer to the centre. Flowing from this, the location of a large supermarket in Merimbula is consistent with the principles set out in The Right Place for Business and Services' because it has sufficient `critical mass' of shops and services to encourage multi purpose trips, thereby promoting the efficient and cost effective provision of public transport, and reducing travel demand.

I understand that there are proposals afoot for further development in and around Tura Beach, which might lead to an increase in demand for retail and services, however from the material I have reviewed, it is unlikely that Tura Beach could attain the same critical mass of shops and services as does Merimbula, not least because of its very close proximity. The provision of retail at a large scale here, would tend to fragment retail activity, when State policy is to concentrate such activity in a fewer number of larger centres. It is quite plausible that there might be some augmentation of retail services at Tura Beach to improve its services to the neighbourhood' (including increases in the scale of the local supermarket perhaps), but a larger full line' supermarket, such as that proposed by the applicant at Merimbula would be out of kilter, in my view, with the demands generated by a local neighbourhood. I do not believe, therefore, that a true 'either/or' situation exists between these two centres, because a larger supermarket should clearly be in Merimbula, if it is provided at all.

The other possible scenarios arising from Council's resolution of 26 April 2006 are that: * A ceiling be placed on expansion of the supermarket facility in Merimbula, irrespective of any proposals for Tura Beach; and * That any larger scale `full line' supermarket be directed to Bega.

In my view, however, a larger supermarket is consistent with the role of Merimbula as a district centre as identified in the draft South Coast Strategy and this in turn is consistent with The Right Place for Business and Services'. There is evidently a latent demand to support an increase in floorspace generated by the existing population, with its particular characteristic of peak tourism demand in summer. There does not seem to be justification, in this regard, to encourage residents to make a trip to Bega, at some distance away, in order to satisfy their convenience (as opposed to comparison') shopping needs. I note, in this regard, a report placed before Council on 26 April 2006 relating to the draft Commercial Centres Strategy, which sets out: `The SGS report [a report I understand was prepared for Council] and to an extent the applicant provided economic studies seem to establish that the two current supermarkets in Merimbula are inadequate for a district of this size. This is certainly the case when tourist impacts are added. The Merimbula Bi Lo is too small to have an adequate range of goods and has no practical trolley access to any sizable car parking. The current Merimbula Woolworths is clearly overtrading and lacks space to stock the range of goods needed for a district of this size. It has poor parking especially when the parking on the Rawson site is deducted and for which Woolworths have no current claim. The Woolworth's supermarket has a loading dock the design of which does not meet Woolworth's needs and which now sees semi trailers doing complex manoeuvres in Main Street. ... From the SGS report and several discussions with Woolworth, Coles and similar large traders there is no doubt that commercially, Merimbula would economically support one supermarket in the range of 3,500 sq m to 4,000 sq m. Both Woolworths and Coles have made it clear that they seek to secure a store of this size in Merimbula. They appear to view Tura as a secondary option for a fall back position if their competitor secures a large site in Merimbula and/or for a smaller scale version of their supermarkets such as 'Foodworks' or 'Bi Lo'. However the significant tourist loading of Merimbula has been enough over the past 20 years to warrant no interest by these larger supermarket traders in Pambula. Tura has even less tourist draw/potential. Coles have even committed their position on Tura to writing. Their letter makes it clear Coles see no interest in Tura and question that a large supermarket would be successful there'.

The third aspect of this issue relates to the proposal's impact on the attractiveness of the centre, by reason of its anticipated exacerbation of existing traffic problems. This is a matter that will be addressed by the traffic experts. By way of general comment, however, a district centre serving a dispersed or rural community will almost certainly experience a level of increased traffic and congestion as the level of services as well as the population served increase. I do not believe on grounds of `character' alone, that this would form a basis for refusal. The traffic and parking issue, in my view, should be considered primarily in the light of the impact on the functionality, safety and convenience of the local road network and internal operation of the proposed development.

54 What has happened since Ms Laidlaw gave her evidence at the first sitting of the Hearing, and before the second sitting, is: * The South Coast Regional Plan has been adopted by the State government. * The State Dept of Planning has issued a s 65 Certificate under the EP&A Act 1979 to permit the exhibition of the draft Local Environmental Plan to limit the floorspace of any new shop or bulky goods outlet in Merimbula to 1000 sq m. * The Bega Valley council has resolved under s 54 of the EP&A Act 1979 to prepare a draft LEP to rezone land at Tura Beach for retail floorspace of 6000 sq m with a limit, except for a supermarket, of 1000 sq m floorspace for any single shop or bulky goods outlet. Once that has been prepared the council resolved to seek a s 65 Certificate from the Dept of Planning to enable exhibition. * The Bega valley Council adopted its Commercial Centres Strategy on 12 December 2006. It provides for planning outcomes reflected in the other statutes, draft statutes and controls referred to here. * The council adopted on 27 January 2007 a development control plan to limit retail floorspace to 1000 sq m per shop in similar terms to the draft LEP for which the s 65 Certificate had been issued by State Dept of Planning.

55 Whilst the adopted South Coast Regional Plan is substantially the same as the draft, the State Dept of Planning has not followed Ms Laidlaw's expected path that would have led to the refusal of the s 65 certificate to exhibit the DLEP to prevent any new large floorspace retail or bulky goods outlets in Merimbula.

56 Whilst the current status of the DLEP could not be made "imminent and certain" there is some weight in the statutory amendment being exhibited prior to any report to the Minister about possible gazettal.

57 The process of extensive public consultation and council decisions on the future direction of planning for Bega Valley and Merimbula and Tura within it, was put by the respondent as constituting weight similar to that in Stockland Development Pty Ltd Vs Manly Council [2004] NSWLEC 472 plus a number of other precedent cases.

58 The council adopted on January 27 - 2007, DCP No.38 that in summary restricts any new retail or bulky goods outlet in Merimbula to a maximum floorspace of 1000 sq m. The DCP has no savings clause to preserve any earlier development application to be dealt with under the previous planning controls, so it applies to the subject development.

59 Turning to the now adopted South Coast Regional Plan, I note that Bega is the Major Regional Centre and Merimbula is a Major Town. On both the South Coast Strategy Map, and the Biodiversity and Coastal Asset Map in the plan the "existing urban area" of Merimbula is shown in white, and extends from Pambula to Tura Beach.

60 Pambula being an historic town has its own shopping centre and community facilities for a population of 923 in 2001 rising to 1308 in 2025 (Bega Valley Shire 2025, Twenty Year Plan). Pambula is classified as a "Town" in the hierarchy of centres in the South Coast Regional Plan. It currently has (22,197 - 2840=) 19,357 sq m of a supermarket and other retail (SGS Economics).

61 Tura Beach is not mentioned as a separate "Town" in the REP, and had a population of 2,305 in 2001, rising to 4,808 in 2025 (Bega Valley Shire 2025, Twenty year plan), currently served by 1072 sq m of a small supermarket and other retail (SGS Economics).

62 SGS had carried out a further review in January 2007 of the economic impacts of various scenarios for years 2006-2011 to advise the council before its final adoption of the Commercial Centres Strategy. It showed in Scenario 3 that with the proposal at Merimbula plus the existing Woolworths as a department store that there is considerable impact on Bega, Pambula and Tura. True the subject proposal does not include a department store at Merimbula. But the study separates the impacts into categories one of which is "supermarkets". Pambula and Tura are impacted in that category by -41% and -29% respectively, and SGS says their supermarkets would reduce operation below benchmark values. 63 The impact on Bega is for "department store" with -19%; I mention this only as an indicator of the Commercial Centres Strategy that would direct any new department store to Bega, plus the draft LEP to restrict the size of any new retail shop in Merimbula.

64 The SGS report says the only option that minimises impacts on adjoining shopping centres is Scenario 2 that puts a 3000 sq m supermarket, 600 sq m retail and 4000 sq m bulky goods at Tura Beach. The only higher range impact is on supermarket turnover in Merimbula at -32%. The evidence that the existing supermarkets there are "over trading" would indicate the council strategy of developing Tura has at least in part an intention to reduce the adverse effects on Merimbula caused by "over trading", and provide for better neighborhood shopping at Tura Beach, an area with growing population and under serviced at the moment (especially compared to Pambula as another "suburb" of Merimbula).

65 These objectives are not "out of kilter" with the retail hierarchy, or the regional plan. There is no intention to undermine Merimbula as a "major town", it is to control the growth of Merimbula and provide reasonable neighbourhood shopping facilities for its suburbs.

66 It may be part of the council motivation and indeed it is part of the Merimbula Chamber of commerce and the objector's motivation, that the traffic congestion in Merimbula town centre needs a breathing space from new major retail development to find solutions. 67 The large volume of local witnesses to the congestion and its impacts is somewhat at odds with the traffic engineers, Mr Higgs and Mr Coady. In the end Mr Coady was satisfied that: o So long as his plan for on-site maneuvering of trucks is included, and o A construction traffic management plan is adopted that also ensures o The127 bowling club car spaces are maintained on-site during construction, and that o There is a truck holding area established out of town both during construction and operation, so that semi trailers only come into Main St one at a time, o And provided semi trailers are excluded from the site and Main Street site between 10am and 6 pm 68 Then he had no remaining objection to the proposal.

69 Mr Coady had formed the opinion, like Mr Higgs that the traffic problems of Merimbula should not penalise the proposal, as its traffic impacts could be managed. Mr Higgs also said that moving the existing Woolworths to the proposal would stop the current truck manoeuvring on Main Street (any future use of the existing Woolworths building was disregarded).

70 It was of some note that in previous negotiations the applicant had volunteered $150,000 to help improve traffic in Merimbula. I asked what were the traffic improvements to be, and what is the s 94 Contributions Plan adopted by the council for new development to add to the fund for works. There is no adopted s 94 Contributions Plan. So the authority to levy such contributions is absent, and the respondent did not press for the $150,000.

71 There was an opportunity, in the break between the first and second sitting of this Hearing, to carry out new traffic counts in the peak Christmas holiday period 2006-2007. In discussion with council's staff, the need to update the 2003 traffic counts as requested by the council and the Regional Traffic Committees was not pressed to Mr Higgs. As a result I do not have the benefit of such figures. Mr Higgs did visit Merimbula on 2 days in January and did not observe any significant congestion. I was told council had moved a bus stop in Market St near the intersection of Merimbula Drive and this had improved things, but witnesses still testified heavy congestion was experienced on particular days. 72 Based on the traffic evidence from the parties' engineers and the lay witnesses there are no empirical observations to determine who is correct about congestion in Main St where the development is proposed, and how much worse the development would make it. It appears that the congestion exists now, and the most the proposal can do is to make it worse, but would that be such that the development should be refused? With Mr Higgs and Mr Coady in agreement that the traffic generation of the proposal, both during construction and operation can be managed to an acceptable level of impact, it is difficult to find that traffic impact is sufficient for refusal.

73 In regard to the council's intended adoption of new car parking requirements of 6.1 spaces per 100 sq m of retail floorspace versus the current 4 cars per 100 sq m; I was told the two traffic engineers considered the Roads and Traffic Authority (RTA) figure of 6.1 cars per 100 sq m is for "stand alone" shopping centres, not for existing shopping centres like Merimbula. The RTA figure for existing centres stays at 4 cars per 100 sq m they said.

74 Returning however to the adopted South Coast Regional Plan, the adopted Commercial Centres Strategy of the council and the existing DCP and exhibited draft LEP to restrict new retail shops to 1000 sq m each in Merimbula, plus the intention to prepare a draft LEP for Tura Beach, I note comments in the report to council in February 2007:

Council's move to constrain future growth in retail in Merimbula to stores of 1000 sq m or less and to limit expansion of Tura to 6000 sq m should achieve a reasonable balance of adequate facilities for weekly shopping needs for the Merimbula district while ensuring one centre (Bega) retains viability to attract a discount department store……….competition in large supermarkets and a core of bulky goods operations. Both the SGS report and the council's Commercial Centres Strategy warn that council is at a crucial phase and it is vital that the desires of some of the larger chains to locate large floorspace commercial development in Merimbula area be constrained and directed to Bega. 75 It is apparent that the council is going about its role under s 5(a) (i), (ii), (v) and s 5(b) and (c) of the Environmental Planning & Assessment Act 1979, in a responsible manner and has included comprehensive public consultation in doing so. The advent of this application occurred during the process, and therefore it could not be said the council was attempting to frustrate a reasonable proposal. Merimbula has topographic and scenic constraints that have already led to urban growth problems, and the council is dealing with that.

76 I have reached the conclusion that the proposal should be refused for the reasons given in Issues 1(a), 4B and C, 5 and 6, including the further particulars to these issues in Exhibit 24, plus non-compliance with DCP 38 limiting the floorspace of any new retail premises in Merimbula to 1000 sq m.

77 Therefore the orders of the Court are: 1. The appeal is dismissed.

2. The exhibits are returned to the parties except exhibits 1, 9, 24, G, H, M, O.

      K G Hoffman
      Commissioner of the Court
      Rjs/ljr

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