A. In the matter of the existing planning permit No. 04341 dated 17 August 2004 ("Permit") which (amongst other features) allows a reduction in car parking for the restaurant operating at 94-114 Princes Way Drouin, the Applicant's appeal against Condition 4 in the Permit is allowed in part.

C. The Responsible Authority is directed to issue a revised permit within 21 days of the date of these Orders, which is otherwise identical to the existing Permit, but with the following new Condition 4 inserted:

"4(a) For the purposes of this Condition 4, "business hours" means 9.00 am to 5.30 pm Monday to Fridays and 9.00 am to 12 noon on Saturdays.

(b) During business hours, the seating capacity of the restaurant on the land shall be restricted to 40 seats."

Mr Richard Davis (solicitor) of Hamilton & Telford solicitors

1 This matter involves a conditions appeal against Condition 4 in the existing planning permit No. 04341 dated 17 August 2004 ("Permit") which (amongst other features) allows a reduction in car parking for the three premises (notably the restaurant) at 94-114 Princes Way Drouin ("subject land").

2 In summary, Condition 4 of the Permit requires the provision of 25 car parking spaces on the subject land, but provides an alternative of the permit holder making a cash in lieu payment to Council, which would be formalised using a 173 Agreement.

3 During the hearing Mr Davis on behalf of the Applicant disputed that there was any need for off-street parking for the three premises, arguing that in reality there is plenty of on-street parking in the town area of Drouin. However he indicated that his client would not contest a limit on the lunchtime seating capacity of the restaurant. It was also acknowledged by Mr McWhinney for Council that the validity of the "cash in lieu" aspect of Condition 4 may be in doubt due to the recent tightening of Sections 62(5) and (6) of the Planning and Environment Act 1987 ("Act"), given that Council does not have any approved Development Contributions Plan.

4 My findings are that the existing Condition 4 is invalid due to the effect of the updated Sections 62(5) and (6) of the Act, but that it is appropriate to substitute a new Condition 4 restricting the seating capacity of the restaurant to 40 persons during business hours. I am satisfied that a dispensation is appropriate in relation to the shortfall of on-site parking in relation to the two future shop uses.

5 This Application originally took the form of a Section 87 Application to amend the Permit. However Deputy President Gibson gave Orders dated 8 March 2005 which allowed the Application to be converted to a conditions appeal under Section 80 of the Act, in relation to the contentious Condition 4 of the Permit.

6 On 27 April 2005 I heard submissions from both parties regarding Condition 4 and in particular the car parking issues associated with the restaurant operating on the subject land. I was advised that the restaurant has been operating since late December 2004.

7 The permitted use under the Permit is "Alterations and additions to existing premises, reduction in car parking and on premises licence for restaurant".

8 The existing Condition 4 of the Permit reads as follows.

This permit shall have no force or effect until the permit-holder provides for an additional twenty-vie (25) car parking spaces to those provided on the land. This requirement may be satisfied or reduced by one or a combination of the following options:

a. Providing the outstanding car parking spaces on other land in the vicinity of the permit land in a location and to a design and construction standard to the satisfaction of the responsible authority.

b. Making a cash in lieu payment for the outstanding spaces to the satisfaction of the responsible authority on the basis of a cost appraisal by the responsible authority of the relative cost of providing a car park of this number of spaces in terms of land and construction costs for the permit land.

c. The owner of the land entering into an Agreement with the responsible authority pursuant to Section 173 of the Planning and Environment Act 1987. The cost of the preparation, lodgement and registration and any subsequent removal of the Agreement shall be borne totally by the owner of the land. The Agreement must be registered on the certificate of title for the land. Evidence of the registration of the agreement must be provided to the responsible authority prior to the commencement of any use, subdivision, buildings or works authorised by this permit.

i.

That the owner of the land permit land shall pay off the cash in lieu car parking cost appraised under (b) above by regular instalments over not more than a ten (10) year period and subject to the defined municipal interest rate.

d. Reducing the seating capacity of the restaurant from the 80 seats proposed with one car parking space to be deducted for every three seats deducted.

9 The subject land is located on the corner of Princes Way and Hope Street on the edge of the central business area of Drouin. The three premises which the Permit allows involve a conversion of a building historically used as an automotive repairer service, and then later used as a plant nursery. The restaurant occupies that part of the building right on the corner of the two streets, and is the largest of the three premises created. The other two premises are to be used as shops.

10 The subject land includes 12 on-site car parking spaces, although four of these spaces take the form of tandem spaces that in practice are only suitable for staff car parking.

11 Roughly to the south of the subject land is the Drouin Station and associated land now owned by Vic Track. A substantial part of this VicTrack land is used for commuter parking, and I understand is otherwise available for casual parking.

12 The subject land lies approximately near the south-west corner of the Drouin central business area. On the same (ie south) side of Princes Way there are various other commercial/retail uses further to the east, although it was common ground that the retail core of Drouin is more on the north side of Princes Way. Apart from the subject land, the Applicant also owns the abutting site immediately east of the subject land, which was previously used as a car lot but which is now vacant.

13 It was common ground at the hearing that (for the purposes of potential new off-street car parks) Council does not own any land immediately around the subject land, south of Princes Way.

14 The restaurant use that is now operating under the Permit involves a premises of 230.8 square metres and a seating capacity of 80 persons. The other two smaller premises in the same building are to be used as shops.

15 Mr McWhinney advised me that the respective areas and car parking generation level of each premises under Clause 52.06 are as follows:

•

restaurant - 230.8 square metres in area, requiring 48 spaces under Clause 52.06;

•

two shops - 110.47 and 91.72 square metres in area, requiring 7.3 and 8.8 spaces respectively under Clause 52.06.

16 The upshot of these calculations is that under Clause 52.06 the total on-site parking required is 64.1 spaces, with the new development providing 12 on-site spaces, leaving a deficit of 52 spaces. Given that Condition 24 requires the provision of 25 on-site spaces, this involves Council allowing dispensation of the other 27 spaces.

17 Mr Davis did not challenge these figures per se, but more argued that the circumstances justify full car parking dispensation of the total shortfall of 52 spaces.

18 The subject land is zoned Business 1 under the Baw Baw Planning Scheme.

19 The normal Clause 52.06 car parking controls are highly relevant here. Council in particular relied on the purpose under Clause 52.06 of ensuring "...the provision of an appropriate number of car parking spaces having regard to the activities on the land and the nature of the locality".

20 Mr McWhinney highlighted that the MSS states that, in relation to the revitalisation of Drouin, Council should:

Continue to improve the urban environment through the development and implementation of streetscape plans and revised traffic management arrangements to strengthen the Warragul and Drouin shopping precinct and commercial areas.

21 In addition, the "Council Plan 2004-2008" contains the strategic objective to "Improve pedestrian and vehicular traffic movements".

22 It was common ground that there is no Parking Precinct Plan for Drouin, although a car parking study was carried out for the township over several days in October 2004. The results of this survey (in summary form) were tabled during the hearing by Mr McWhinney.

23 Mr McWhinney otherwise relied on Clause 22.02-3 of the Planning Scheme, which provides as follows.

The planning and functioning of car parking is important for the continuing development of the retail and business sector. It is necessary that where the provision of car parking required by the scheme cannot be made on site or in close proximity to a new use or development that cash in lieu payments be considered in order to provide for car parking areas.

* To provide cash in lieu payments for car parking when it cannot be provided on-site or nearby.

* In considering an application to reduce or waive the number of car parking spaces, the responsible authority shall take into account whether a cash contribution should be sought.

24 I will not set out the arguments of the parties in detail, given that a copy of their written submissions are retained on the Tribunal file, along with the various plans and materials tabled during the hearing.

25 In summary, Mr McWhinney put to me that there is very limited car parking available on the south side of Princes Way, which will encourage what Council regards as an undesirable situation of people parking on the north side of Princes Way and having to cross Princes Way to get to the restaurant and/or future shop uses on the subject land. This is in the context of restaurants (compared to other commercial/retail uses) being a relatively high generator of demand for car parking.

26 In relation to the car parking study for the township carried out in October 2004, Mr McWhinney submitted that this reinforces Council's basic position that there is only limited on-street parking available in direct proximity to the subject land, which supports Council's cautious approach to allowing car parking dispensation.

27 More at a "big picture" level, Mr McWhinney noted that the level of commercial activity in Drouin had picked up pace in recent years, as Drouin has become more attractive to persons wishing to commute into Melbourne. Hence Mr McWhinney argued that there is likely to be a continuing growth in commercial activity in the township and this growth needs to be considered in the context of the likelihood of increasing demand for on-street parking over time.

28 Mr McWhinney conceded that (in relation to the potential cash-in-lieu payment) Council does not own any land in the immediate vicinity of the subject land south of Princes Way, but put to me that Council might be able to purchase at least some of the nearby land off Vic Track. However, in response to my queries, he conceded that Vic Track had to date provided a fairly "luke warm" response when the possibility of such a land sale had been raised by Council with VicTrack.

29 In relation to the issue of whether the "cash in lieu" aspect of Condition 4 is still valid in light of the recent amendments to Sections 62(5) and (6) of the Act, Mr McWhinney acknowledged this is a real issue but:

•

relied on the fact that the cash in lieu payment is only put forward as an optional alternative to the provision of the 25 on-site spaces rather than being a mandatory requirement; and

•

maintained that there are good reasons for the basic requirement under Condition 4 of the Applicant needing to provide 25 on-site car parking spaces.

30 In response, the primary submission of Mr Davis (whose office is at the eastern end of the central business area in Drouin) was simply that there is plenty of spare on-street car parking in central Drouin, and that it is an inappropriate "overkill" for Council to be emphasising the need for additional on-site car parking on the south side of Princes Way. Rather, Mr Davis put to me that it is quite reasonable and appropriate for patrons of the restaurant/future shops to park in the nearby streets on the north side of Princes Way and walk back across to the restaurant/future shops. He argued that this would only be a short walk for patrons, and is consistent with the existing pattern in the township of people being happy to walk across the modest business area to get to different commercial/retail services.

31 In putting forward his submission that there is adequate on-street parking in the central business area of Drouin, Mr Davis relied on:

•

His own practical experience as a person who works in Drouin on a daily basis; and

•

The results of the October 2004 Council parking survey, which indicated that the total number of vacant on-street car parking spaces in the central business area of Drouin during business hours on average was 270 spaces. In reliance upon his earlier submission that there is easy pedestrian access to the subject land from the business area on the north side of Princes Way, Mr Davis put to me that in reality there is convenient access to the subject land from most if not all of these 270 on-street spaces which the survey indicated on average are vacant.

32 In relation to the option under Condition 4 of the Applicant instead making a cash-in-lieu payment, Mr Davis was critical of the fact that Council does not own any land immediately near the subject land. Accordingly, Mr Davis argued that Council's aim of providing a new off-street car parking in this particular area south of Princes Way may in reality come to nothing, particularly given the unhelpful attitude of Vic Track to date.

33 In relation to the future growth prospects of Drouin, Mr Davis agreed Drouin is growing but considered that any resulting changes to the current car parking situation would be so modest as to not raise concerns here.

34 Mr Davis also referred to other examples of Council granting favourable car parking dispensation along the lines of "good enough for them, good enough for us", but as I mentioned at the hearing, I consider that this type of situation needs to be considered on a "case by case" basis, looking at the facts of each case.

Findings of Tribunal - Validity of Optional Cash-in-lieu Payment under Condition 4(b) and (c)

35 To recap, Condition 4 has the following main aspects:

•

The starting point is that it requires the provision of 25 car parking spaces on the land (when only 12 are proposed); and

•

It then provides that this "provision of 25 spaces" requirement can be satisfied by one of or a combination of the following. First, a cash-in-lieu contribution can be made, which would be formalised by way of a Section 173 Agreement. Secondly, the seating capacity of the restaurant may be reduced below the current cap of 80 seats, with one necessary car parking space deducted for every three seats removed from the cap of 80 seats.

36 Following the implementation of the Planning and Environment (Development Contributions) Act in December 2004, the revised Sections 62(5) and (6) of the Act provide as follows.

(5) In deciding to grant a permit, the responsible authority may-

include a condition required to implement an approved development plan; or

include a condition requiring specified works, services or facilities to be provided or paid for in accordance with an agreement under Section 173; or

include a condition that specified works, services or facilities that the responsible authority considers necessary to be provided on or to the land or other land as a result of the grant of the permit be-

a.

provided by the applicant; or

b.

paid for wholly by the applicant; or

c.

provided for or paid for by the applicant where the remaining cost is to be met by any Minister, public authority or municipal council providing the works, services or facilities.

(6) The responsible authority must not include in a permit a condition requiring a person to pay an amount to for or provide works, services or facilities except-

(a) in accordance with sub-section (5) or section 46N; or

(b) a condition that a planning scheme requires to be included as referred to in sub-section 1(a); or

(c) a condition that a referral authority requires to be included as referred to in sub-section (1)(a).

37 The critical features of the proposed payment-in-lieu arrangement under Condition 4 for our purposes are that:

•

It is unclear whether Council will be able to secure any land close to the subject land on the south side of Princes Way for a car park, and if so, how long this will take; and

•

The funding arrangement is not just between Council and the Applicant here, but can be expected to involve cash-in-lieu contributions from other permit applicants.

Doubts about Nexus Between Proposal and Cash-in-lieu Arrangement

38 In relation to the first bullet point above, this raises questions as to whether the lack of any suitable nearby location for a future car park makes Condition 4 so uncertain in its practical operation as to be invalid. In other words, what is the end result if the Applicant (and possibly other owners) make cash-in-lieu payments but Council is never able to purchase any suitable land in the immediate area for car parking?

39 The leading cases in this area of the validity of permit conditions are Pyx Granite Co Ltd v Ministry of Housing & Local Government [1958] 1 QB 554, Eddie Barron Constructions Pty Ltd v Shire of Pakenham & Anor [1990] 6 AATR 10 and Christian Brothers Vic Pty Ltd v Banyule CC [2001] VCAT 2120.

40 Some fundamental principles which emerge from these cases are that:

•

There must be a real connection or nexus between the proposed development and the contentious permit condition; and

•

The requirements of the condition must fairly and reasonably relate to the proposed development.

41 In my view, while I do not need to make a formal determination due to my other findings set out below, there is real doubt whether the "cash-in-lieu" aspect of Condition 4 satisfies these requirements, given the major uncertainty involved in whether Council will be able to secure any location for car parking in the immediate area south of Princes Way.

Cash-in-lieu Arrangement Invalidated by Absence of Approved Development Contributions Plan

42 Turning then to the second critical feature of Condition 4 for our purposes, the point here is that the cash-in-lieu arrangement under Condition 4 can be expected to operate in conjunction with equivalent payments from other landowners in Drouin. Once this "contributions from multiple owners" situation arises, the arrangement then starts taking the form of a de facto development contribution scheme.

43 As alluded to, this in turn raises the question whether this "cash-in-lieu contributions from multiple owners" arrangement is still valid, in light of the recent tightening up of Section 62(5) and (6) of the Act.

44 In my recent decision of Springhaven Property Group Pty Ltd v Whittlesea City Council [2005] VCAT 816, I was required to review the validity of a contentious permit condition requiring the Applicant to make a pro rata payment (along with various other neighbouring landowners) to partially reimburse the "pioneer developer" who had originally sealed the relevant access road which the other landowners now had the benefit of. I found that this condition was invalid, relying in particular on:

•

the fact that the contentious condition did not arise from any relevant approved Development Contributions Plan ("DCP"), nor did it spring from any specific requirement of the Planning Scheme or of a referral authority;

•

the involvement of multiple neighbouring landowners, rather than it being an arrangement just between Council and the Applicant; and

•

the previous road works having been carried out by a private developer rather than by Council.

45 I have set out in the Appendix to this decision paragraphs 57-75 from this Springhaven decision, which provide some useful commentary on the process that led to the revised Sections 62(5) and (6).

46 Using the starting point of whether the proposed cash-in-lieu arrangement here satisfies the requirements of the revised Section 62(6), 62(6) only allows this type of condition providing for a cash contribution towards works (eg developing a car park) in certain specific circumstances set out in sub-sections (a) to (c). In summary, clearly the cash-in-lieu arrangement here cannot be justified by way of an approved DCP, or as a specific requirement of the Planning Scheme or of a Referral Authority. This means that the only basis on which the arrangement is valid under Section 62(6) is if it is "in accordance with sub-section (5)" as provided for in 62(6)(a).

47 Moving then to Section 62(5):

•

62(5)(a) cannot be relied upon as there is no approved DCP here;

•

62(5)(c) also cannot be relied upon, as the cash-in-lieu arrangement can be expected to involve other landowners;

•

leaving the question whether the arrangement can be justified under Section 62(5)(b). Sub-section (b) essentially provides for a situation where this type of cash contribution towards works involves a permit condition requiring the contribution to be formalised through a Section 173 Agreement.

48 The "sixty nine dollar question" then becomes whether the cash-in-lieu arrangement proposed here can be justified on the basis that the contentious Condition 4(c) requires the Applicant to enter into a Section 173 Agreement.

49 My finding here is that the cash-in-lieu arrangement cannot be justified by Condition 4(c) because of the "contested" nature of that sub-clause. In other words, this is not a situation where the parties have negotiated a mutually acceptable car parking arrangement and Condition 4(c) has been included by consensus. Rather, this is a clear example of the Council seeking to foist the proposed cash-in-lieu arrangement on the Applicant, with the proposed 173 Agreement merely part of this "foisting exercise".

50 I refer to my overview of the 2000-2003 Development Contributions Review Process set out in the Appendix to this decision. As part of this process, a key part of the recommendations made for moving forward were that:

•

on the one hand, there needs to be a much greater use of approved development contribution plans as the standard method for Councils requiring development contributions from multiple landowners; but

•

on the other hand, there still needs to be some reasonable flexibility for the continuing use of Section 173 Agreements, where a permit applicant has reached a consensus with the Council regarding an appropriate development contribution. A typical example of this situation might be a permit allowing the expansion of a shopping centre, where the shopping centre owner has agreed with Council to say expand the local bike track and library as part of gaining Council approval of the permit. In most if not all cases, one would expect this type of "entering into a 173 Agreement by consensus" arrangement to only involve the Council and the landowner involved.

51 Returning to the facts in question here, the important distinguishing features are that:

•

the cash-in-lieu arrangement can be expected to involve other landowners; and

•

the Applicant has not agreed to the arrangement but is vigorously opposing same by way of this appeal to the Tribunal. Hence Condition 4(c) provides for a Section 173 Agreement in a "contested situation" rather than one of "consensus".

52 Accordingly, my finding is that having regard to the process that led to the introduction of the revised Section 62(5):

•

it was not the parliamentary intent that Section 62(5)(b) be utilised to justify this type of situation where Council is effectively seeking to use a Section 173 Agreement to bolster its position in a contested situation; and

•

as a result, the proposed cash-in-lieu arrangements set out in Conditions 4(b) and (c) are invalidated by Sections 62(5) and (6).

Findings of Tribunal - Merits of Conditions 4(a) and (d)

53 In relation to Condition 4(a), my findings are that:

•

I accept that the evidence indicates that there is ample existing on-street parking in the Drouin central business area, such that full car parking dispensation is reasonable in the circumstances;

•

I rely here on the submissions of Mr Davis (who works daily in Drouin) that there are good levels of available on-street parking during business hours. Whilst not meant as a criticism, it went against Council's case that Mr McWhinney does not live or work in Drouin, and hence was unable to provide any real personal perspective on the levels of on-street parking in central Drouin. This was in the context of Council not having called any expert evidence to support its case that under Condition 4(a) at least 25 car parking spaces should be provided on the subject land;

•

It was also significant that when I asked Mr McWhinney during the hearing to identify the streets from the Council parking survey most likely to be used by patrons wishing to use the restaurant, Mr McWhinney identified three street sections which the survey shows (when considered in totality) had a substantial level of vacant on-street spaces during the relevant survey periods. Most of the balance of the surveyed street sections revealed even greater levels of vacant car park spaces. Hence I do not accept that the car parking survey information justifies the Council's imposition of Condition 4(a) - rather the survey information seems to undermine the justification for 4(a);

•

With respect to Mr McWhinney's reliance upon the changing nature of Drouin in terms of the growing number of residents and more vibrant business activity in recent years, I accept that these factors indicate that some caution is needed in allowing car parking dispensation. However it also seems the case that, where Council refuses a request for car parking dispensation, Council needs to be able to produce evidence at the hearing of some degree of existing on-street car parking pressure. In other words, as a matter of good planning, Council needs to do more than simply relying on the possibility of increased on-street car parking demands in the future. In all the circumstances, even when taking a cautious approach, I cannot see any real evidence of existing on-street car parking pressures so as to justify the requirement for 25 on-street car spaces on the subject land.

54 Turning to Condition 4(d), in the circumstances I see no justification for the proposed arrangement under this sub-clause. For the reasons set out above, but subject to the proviso set out below, I see no threshold on-street existing car parking pressure which would justify the proposed formula of requiring 25 car spaces to be provided on the land, but then allowing same to be reduced on a "sliding scale" basis through the Applicant reducing the number of proposed seats in the restaurant.

55 The proviso is this. It was common ground at the hearing that:

•

to the extent that there is real demand for on-street car parking in the central business area of Drouin, it is during business hours. By contrast, there is very little demand for central on-street parking after hours; and

•

the restaurant (I was told by Mr Davis) is a "fine dining" establishment which does the bulk of its business out of business hours. I was advised that the restaurant has now been trading for about five months, and that its lunchtime patronage is more modest, such that the restaurant would rarely have more than 40 seats occupied.

56 In these circumstances, and in light of my comments above regarding the merits of a cautious approach in light of the on-going growth of Drouin, I find that it is reasonable and appropriate to substitute a new Condition 4 which does not require any additional car parking beyond the 12 spaces provided, but which also limits the seating capacity of the restaurant during business hours to 40 rather than 80 seats.

57 As indicated at the hearing, if the Applicant wishes at a later stage to amend Condition 4 so as to allow more than 40 seats to be used for lunchtime trading, it seems fair and reasonable that the Applicant provide more comprehensive traffic evidence at the time to justify same. That is, although I have been content for the purposes of this decision to rely on the general submissions made to me by Mr Davis (as someone who works daily in Drouin) and the results of the Council car parking survey, I expect that next time the Applicant would need to be more proactive in producing its own traffic evidence to support changing the status quo under the revised Condition 4.

58 For the reasons set out above, I have ordered that the existing Condition 4 be deleted, but I have also set out a replacement Condition 4 limiting the seating capacity of the restaurant to 40 seats during business hours.

59 In relation to the two other new premises on the subject land which are proposed to be used as shops, I note that there was no real discussion of same by the parties during the hearing. To remove any doubt, I am satisfied that (subject to the imposition of the revised Condition 4) the evidence indicates that it is appropriate that no additional on-site car parking is required for these shops.

APPENDIX - Paragraphs 57 - 71 from Springhaven Property Group Pty Ltd v. Whittlesea City Council [2005] VCAT 816

Second Reading Speech and Development Contributions Review Process

60 Before reaching an overall finding on the validity of Condition 24, it is worth considering whether any guidance comes from reviewing the Second Reading Speech (or other Parliamentary debate) for the Planning and Environment (Development Contributions) Bill, or from the Review Process that led to that Bill.

61 In relation to the former, I have reviewed both the Parliamentary Second Reading Speech and the associated debate. While there were no "gems" directly on point, I note that the Second Reading Speech by the then Planning Minister did include the statement that "...permit conditioning (sic) provisions should not undermine the principle that development contributions applying to landowners should be collected via development contribution plans". It is pertinent in reviewing this quote that Condition 24 effectively relates to a defacto scheme (rather than an approved DCP) to recoup the Gordons Road development costs from multiple landowners.

62 Turning to the Development Contributions Review process, this involved a very long consultation and reporting process running from 2000 to 2003, with the aim of improving the operation of the development contribution provisions under the Act. In particular, it was widely acknowledged that there had been a very low take-up by Councils of the opportunity to prepare DCPs since the mid 1990s, with the practical result that in most cases what might be described as "haggling" over development contributions still occurred though the use of Section 173 Agreements.

63 The Review process involved a Steering Committee with broad representation, extensive consultation, and the production of both an initial report and a final report ("A new development contributions system for Victoria") in May 2003. A good place to review same is the DSE website (www.dse.vic.gov.au, click on "planning", then click on "development contribution guidelines", then click on "review of development contributions").

64 While the outcome of this Review is worthy of a separate paper in itself, suffice to say that the Review process inter alia:

•

recognised the need for a much greater use of DCPs by Councils;

•

recommended the introduction of a simpler system of using a pre-set schedule (ie "off the shelf") of infrastructure levies, to reduce the work involved in preparing a DCP; and

•

recognised the need for legislative amendment to Section 65 of the Act, to improve and tighten the statutory framework for the imposition of development contribution permit conditions by Council.

65 By way of example of the Review process pushing for greater utilisation of DCPs rather than arbitrary use of permit conditions, the "Detailed guidance about the use of DCPs" chapter in the May 2003 paper has the following opening paragraph.

Development contribution plans (DCPs) will continue to be the key mechanism use to levy new development for contributions to planned infrastructure to meet the needs of future communities.

66 In the "A clearer framework for the use of planning permit conditions" chapter of the May 2003 paper, it is significant that where the final paragraph discusses the on-going use of permit conditions (ie rather than DCPs) by Councils, the focus is on the provision of on-site infrastructure relating just to the individual development (eg on-site roads, on-site drainage, etc).

Findings of Tribunal regarding Validity of Condition 24

67 Having regard to my discussion above of the King Ranch and Christian Brothers cases, Sections 62(5) and 62(6), the Second Reading Speech for the Amendment Bill and the Development Contributions Review process, my overall finding is that Council did not have the power to validly impose Condition 24, and that Condition 24 should be deleted from the Permit.

68 The key to this finding is the important changes to the text of Sections 62(5) and (6) under the recent Amendment Act. In particular, the operation of Section 62(6) has been tightened so as to close off the potential to use the Christian Brothers approach of distinguishing between services/facilities versus works.

69 Rather, the situation now is that Condition 24 falls fairly and squarely within the operation of Section 62(6). Section 62(6) effectively strikes down Condition 24, since there is no ability here to defend Condition 24 by relying on the exceptions under 62(6) (ie the proposed Condition 24 does not arise from Section 62(5), a DCP, a requirement of a Planning Scheme or a requirement of a referral authority).

70 This outcome is not that surprising when one has regard to the relevant provisions of the Amendment Act Second Reading Speech and the Development Contributions Review process that I have highlighted above. I this Speech and Review process, there is a clear signposting that, as a matter of good policy and planning practice, Councils now need to use planning permit conditions much more sparingly and make the preparation of DCPS their main focus of how they deal with development contribution issues.

71 While the process may have needed a long time to get up momentum, clearly the "goal posts have changed" in how development contributions are to be imposed, and it is in everyone's interests for the various stakeholders to get up to speed on the changes and adjust to the new regime.

72 For the reasons set out above, I conclude that:

•

Condition 25 is valid and can remain a proposed condition; but

•

Condition 24 is invalid and should be deleted from the proposed conditions.

73 All stakeholders in the development contributions system need to recognise the significance of the recent amendments to Sections 62(5) and (6) of the Act. In particular, there is a clear intent (based on the work done in the 200-2003 Review process) that Councils need to take a more formal/prescriptive approach to dealing with situations where Council is seeking development contributions from multiple landowners.

74 While it may have been possible in the past to deal with this type of "contributions from multiple landowners" situation in a more informal manner through permit conditions (such as Condition 24 in question here), Council's will now need to take a more proactive and "up front" approach through the preparation of DCPs. The introduction of the "deemed to comply" or "off the shelf" system of infrastructure levies should hopefully ease the logistical problems that have apparently constrained the preparation of DCPs since 1995.