Archive | Planning

Council agrees to reprioritise land supply schedule

Auckland Council’s planning committee skipped the most pressing part of its business yesterday – decisions on refreshing the overarching Auckland Plan – but did spend time on its future urban land supply strategy.

Committee chair Chris Darby said the Auckland Plan refresh and how the council would consult on it had been deferred until Tuesday 28 March because more preparation was needed.

But the committee discussed in detail the future land supply strategy and agreed to a number of changes to sequencing.

Staff recommended advancing work on some areas and deferring it elsewhere because of infrastructure constraints. The estimate to install bulk infrastructure over the next 30 years is $19.7 billion.

Areas to be brought forward: Warkworth North, Wainui East, Silverdale (business), Red Hills, Puhinui (business), Wesley (Paerata), Opaheke Drury, Drury South.

Areas to be pushed back: Kumeu-Huapai-Riverhead, Whenuapai stage 2, Drury West stage 2, Puhinui (business), Red Hills North, Warkworth North-east & Takanini.

Public consultation on the Auckland Plan is scheduled for the period 29 March-18 April.

East-West link

The planning committee also identified a number of concerns about the East-West link project intended to run through Onehunga.

The Government identified the project as a road of national significance and referred it to a board of inquiry. The NZ Transport Agency’s applications were publicly notified on 22 February and submissions close on 22 March.

  • This is an overly short version of events at yesterday’s committee meeting – being in 2 places at once doesn’t always work. I’ll come back with more detail on the land issues and the East-West link.

Committee agenda

Attribution: Council release, agenda.

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Maori board fails in appeal over mana whenua sites

High Court judge Ed Wylie ruled yesterday that the independent panel on Auckland’s unitary plan didn’t err in recommending the sites of value for mana whenua be deleted.

The Independent Maori Statutory Board appealed the deletion, but Justice Wylie rejected all the board’s appeal points.

Justice Wylie wrote in his decision yesterday: “In my judgment, the independent hearings panel was entitled to reach the conclusions and make the recommendations it did. It heard evidence from a large number of parties, both for & against retaining (&/or expanding) the overlay. It was for the panel as a specialist independent body to exercise its judgment in evaluating the evidence put before it at the hearings.

“It was open to the panel to recommend deletion of the sites of value to mana whenua overlay on the basis that, without evidence of mana whenua values that provided support for all of the sites in the schedule and in the overlay, the provisions as a whole lacked a sufficient evidential basis.”

When Auckland Council released its draft unitary plan in March 2013, it proposed 2 layers of protection for sites & places of Maori cultural heritage. The first contained a schedule of 61 sites of significance, and the second contained a Maori cultural heritage alert layer which would extend to about 9000 sites.

After feedback, the plan was amended in September 2013 and the second layer was reduced to 3600 sites. However, an error on the planning maps meant the radius of circled sites was doubled to 100m.

In evidence in 2015, the council told the independent hearings panel 2213 sites met the criteria of being Maori, had mana whenua values ascribed to them, and their location was confirmed. The council recommended another 1373 be removed from the schedule.

In March 2016, the council withdrew 593 sites, left 3007 scheduled, and said 2213 were considered to be of Maori origin, had cultural values for mana whenua and their locations had been confirmed.

However, the hearings panel decided to recommend to the council that it delete the schedule in its entirety “until the evidential basis for it has been assembled”.

When the council went through the final process on the plan, going through all the hearings panel’s recommendations and deciding whether to accept or reject them, staff recommended rejecting the panel’s deletion of the Maori places schedule.

The councillors, however, decided to accept the panel’s recommendations, which led the Independent Maori Statutory Board to appeal, eventually, on 9 points of law.

On each one, Justice Wylie found the hearings panel was entitled to reach the conclusion it did.

Auckland University environmental law associate professor Ken Palmer, who appeared on the appeal on his own account, argued that the council’s approach to the evaluation of sites of value to mana whenua didn’t follow the conventional approach, went beyond reasonable regulation and added a layer of complexity & uncertainty to the plan, placing an added burden on the owners of the affected private land.

If the council accepted a recommendation of the independent hearings panel, it didn’t have to give reasons. Justice Wylie accepted that point in dismissing the Independent Maori Statutory Board’s appeal.

Attribution: Judgment.

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Council to choose Auckland Plan refresh option

Auckland Council’s planning committee will decide tomorrow on which of 5 options to follow to refresh the region’s overarching planning document, the Auckland Plan.

The plan was approved in 2012, in the first term of the super-city council, and was followed by a series of related plans for the central area, the waterfront, local board plans and, the biggest of them all, the unitary plan combining regional policy statements & the district plan.

The council’s strategic advice manager, Denise O’Shaughnessy, said in her report to the committee that, while the Auckland Plan had proven to be an important & useful document, “it has shortcomings which have become evident during implementation. These shortcomings include outdated data, limited integration, a complex structure, too much low-level content, limited prioritisation and a weak monitoring & reporting framework. In addition, the plan is in hard-copy form and therefore cannot be easily updated or accessed.”

Staff have recommended option 4 – “a streamlined spatial approach” – to replace the existing plan “on the basis that it provides appropriate focus on spatial components while ensuring these are strongly connected to the achievement of high-level social, economic, environmental & cultural objectives. The option structures the plan around a small number of interlinked themes that address Auckland’s biggest challenges.”

The other options were a light update, a full update, updating only the development strategy, and a streamlined version that would include detailed non-spatial initiatives & narrative.

The recommended option 4’s update cost is estimated at $2.69-3.53 million, in the mid-range of estimates for the 5 options.

Option 4 would:

  • update & add new general facts & figures
  • use a small number of organising & interlinked themes around Auckland’s key challenges
  • set high level objectives, both spatial & non-spatial, in these theme areas with a brief narrative
  • focus on development strategy to reflect unitary plan decisions; infrastructure strategy; strategic work on urban, rural & future urban development areas; national policy statement on urban development capacity requirements; and create a new growth model
  • exclude any further non-spatial initiatives, narrative or detail and remove more detailed operational directives
  • creates a limited number of high level indicators to track progress and measures to guide the work programme
  • removes all other material in the existing plan, and
  • create a digital plan.

Staff have recommended targeted early public engagement through channels such as online feedback/polling & workshops with community group representatives from May-July. That would be followed next year by a special consultative procedure on the draft refreshed Auckland Plan, at the same time as the council consults on its draft long-term plan.

Committee agenda item: Options for refreshing the Auckland Plan

Attribution: Committee agenda.

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Unitary plan ‘operative in part’, and courts want speed on appeals

The parts of the Auckland unitary plan not subject to appeal officially became operative yesterday.

The plan is officially referred to as the ‘Auckland unitary plan operative in part’, and is on the council’s website.

Those operative parts of the plan replace the district & regional plans of Auckland’s 8 councils that were replaced when the super-city was established in 2010.

Auckland Council unitary plan manager Celia Davison said large parts of the regional policy statement, regional plan and some parts of the district plan have been made operative because most of the appeals relate to specific sites or specific provisions in the plan: “For those parts of the plan still subject to appeal, the old rules will remain in place, with the council being required to assess all resource consent applications against the relevant parts of both the old & new plans.

“Decisions will need to be made on a case-by-case basis as to how much weight can be given to the Auckland unitary plan versus the legacy district & regional plans.”

This consists of annotated text & maps that will help users of the plan to identify the parts that are not yet operative & under appeal.

Once all appeals are resolved, the unitary plan will be made fully operative.

The process & timeframe for resolving the appeals is a matter for the courts. However, Ms Davison said the council would work with all parties to ensure they’re resolved quickly.

Those parts of the unitary plan that are not operative are:

  • Those provisions that remain subject to Environment Court & High Court appeals
  • The regional coastal plan component of the proposed plan, as it requires separate approval from the Minister of Conservation under section 152(3)(b) of the Local Government (Auckland Transitional Provisions) Act 2010 and clause 18(3) of schedule 1 of the Resource Management Act, and
  • Certain designations which appear in the proposed plan.

“Out of scope” appeals & Environment Court mediation

High Court judge Christian Whata decided in October to resolve the broad “out of scope” appeals with a test case or cases on the scope of the independent hearings panel to make recommendations.

Justice Whata said: “The objective of the test case(s) will be to provide a principled framework for the resolution of the individual claims. Individual parties will be directed to indicate whether the resolution of the test case will resolve their claims as to scope and, if not, why not.”

The broad “out of scope” appeals were filed by the Character Coalition, Auckland 2040 and Franco Belgiorno-Nettis.

The Environment Court sought comments by today on council assessment of overlap between appeals to the 2 courts and recommendations for mediation. The Environment Court will then set many cases down for mediation.

The court minute notes the urgency of dealing with the plan: “Parties should understand that, where mediation does not work (whether in full or in part), hearings will commence very shortly thereafter, and timetables for preparation for an early hearing will be put before a judge for urgent approval.”


Unitary plan

Attribution: Council release, court minutes.

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National policy statement on urban development capacity takes effect in December

The Government has signed off its national policy statement on urban development capacity, aimed at ensuring councils in rapidly growing urban areas provide enough land for new housing & business development.

Environment, Building & Housing Minister Nick Smith said on Monday: “The national policy statement requires councils to allow for a greater supply of houses, so prices rise more slowly and houses are more affordable. The long-term root cause of New Zealand’s housing affordability problems is insufficient land supply, especially in Auckland, where median section prices increased 350% from 1990 to now. Building costs increased only 78% during the same time.

“The policy statement will require councils to base their decisions on better information, including house prices in their areas. It is also a powerful lever for those seeking additional residential zoning from councils in that they can appeal council decisions to the Environment Court on the basis the council is not meeting supply requirements.”

The policy statement takes effect on 1 December. Dr Smith said biggest councils experiencing high growth would be most affected, including Auckland, Christchurch, Tauranga & Hamilton. Smaller, fast-growing places such as Nelson & Queenstown would also be affected.

“It also requires local authorities & infrastructure providers to better co-ordinate the provision of services needed to support housing & business growth.”

Dr Smith said it had taken under 9 months to deliver this policy statement, compared to the standard 3 years: “This reflects the importance of action on housing and the increased emphasis on the use of national Resource Management Act tools. It sits alongside the new unitary plan [in Auckland] & the Government’s Resource Management Act reforms to address the core issue of increasing land supply.

The building consent picture

“Today we’ve also seen building consents figures which show we’re in the midst of the longest & strongest building boom on record, with the total value of building work for the year to September hitting $18.7 billion.

“Nationally 29,935 residential building consents were issued for the year to September – an increase of 122% compared with 5 years ago. In Auckland, 9960 consents were issued, up 186% on 5 years ago.

“It is particularly encouraging that construction work in Auckland has grown 36% in the past year, to $7.2 billion.

“Just last week we announced a heads of agreement on a 104-dwelling development at New North Rd in Mt Albert and turned the first sod at a 196-dwelling development in Massey East, both of which are part of our Crown land housing programme. I also turned the first sod at a 1350-dwelling development in a special housing area at Drury.

“This government is step by step, development by development, getting on and addressing Auckland’s housing challenges.”

Earlier stories:
1 November 2016: Auckland share of new home consents drops, intensive ratio holds
27 June 2016: Lawyers take issue with minister’s urban land target
14 March 2016: Council says Government approach wrong on resource management reform
10 August 2015: Council has forthright message for Government on land for housing
27 July 2015: Another contortion on development capacity
19 July 2015: Unitary plan panel sets programme for April 2016 hearings conclusion
17 July 2015: Council wants feedback on greenfield rezoning sequence
19 June 2015: Key points from land for housing report
Commission looks behind high land prices

Attribution: Ministerial release.

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Propbd on Q Th29Sept16 – Unappealed unitary plan sections operative, short results from 7 auction sessions

Council makes operative what it can of the unitary plan
Results from 7 auction sessions
Both units passed in at Ray White auction
5 units sell at Barfoots
Newton Rise apartment sells at City Sales auction
5 apartments sell at Bayleys, commercial unit prior
7 intensive properties sell at Barfoots’ Wednesday auctions

I haven’t done a Propbd on Q for a while, but I’ve got far enough behind over the last couple of days that it makes sense to offer you the short version of auctions.

I spent a couple of hours at the Town Hall this morning – skipped out after the governing body approved making the unitary plan operative (minus the parts that have been appealed) and before the valedictories. The council’s annual report went through without question.

Council makes operative what it can of the unitary plan

Auckland Council’s governing body took 20 minutes today to make its unitary plan operative, excluding those parts subject to appeal or judicial review.

Regional coastal plan provisions not subject to challenge will go to the Minister of Conservation, Maggie Barry, for approval.

Franklin councillor Bill Cashmore, re-elected unopposed, will handle any matters that can be resolved without a hearing from the end of the current council’s term on 16 October and the first meeting of the newly reconvened governing body on 1 November.

Regulatory services director Penny Pirrit told the governing body today one joint appeal lodged by Auckland 2040 & the Character Coalition was broad in scope and had the potential to impact residential development around the region.

Both organisations opposed the unitary plan independent hearings panel’s resolution of how out-of-scope matters should be dealt with, and that’s the basis of the appeal to the High Court.

Results from 7 auction sessions

Below, the brief results of 7 auctions over the last 2 days – 4 sessions at Barfoot & Thompson’s city rooms, the others at Bayleys, City Sales & Ray White City Apartments.

All up, 79 properties were on offer, of which 34 were sold. Excluding standalone homes on regular sections, but including some development land and a couple of houses broken into flats, 18 were sold out of the 40 properties I categorise as intensive.

I’ll have more detail overnight on all auctions.

Both units passed in at Ray White auction

A Mt Eden unit and a Metropolis apartment were both passed in at Ray White City Apartments’ auction today. Auction results:

Mt Eden, 66 Mt Eden Rd, unit 12B, passed in after bid of $340,000, reserve reduced to $360,000, agent Krister Samuel
Metropolis, 1 Courthouse Lane, unit 1508, passed in at $820,000, James Mairs

5 units sell at Barfoots

Barfoot & Thompson sold 4 apartments in the morning and one suburban unit in the afternoon at its city residential auctions today. Auction results:

The Quadrant, 10 Waterloo Quadrant, unit 1314, sold for $430,000, Romelle Smith & Alan Vessey
Columbia on Nelson, 15 Nelson St, unit 3X, no bid, Livia Li & Alan Guo
Tower Hill, 1 Emily Place, unit 13D, passed in at $700,000, Ashlee Zhang & Ocean Shao
Parkside, 6H Scotia Place, no bid, Selina Zheng & Tommy Zhang
Herne Bay, 5 Curran St, unit 3, sold for $800,000, Louise Stringer & Jim Liu
Parnell, 30 Heather St, unit 2C, sold for $710,000, Annie Xu & Sean Zhang
Greenlane, 2 Atarangi Rd, unit 2, passed in, Aaron Cook & Betty Shao
Oakwood Hall, 81 Wakefield St, unit 5A, sold for $240,000, Ashlee Zhang & Ocean Shao
Onehunga, 66F Grey St, sold for $395,000, Richard Prasad
Mt Eden, 19 Ellerton Rd (7–bedroom home converted into 3 flats), passed in at $1.9 million, Gill Macdonald

Newton Rise apartment sells at City Sales auction

An apartment in the Newton Rise building, Eden Terrace, was sold under the hammer at City Sales’ auction yesterday.

Newton Rise, 121 Newton Rd, unit 4B, sold for $636,000, Steve Kirk & Habeeb Urrahman

5 apartments sell at Bayleys, commercial unit prior

5 apartments were sold at Bayleys’ residential auction yesterday and a commercial unit in the Wairau Valley was sold prior at a 5.19% yield. Auction results:

96 on Symonds, 96 Symonds St, unit 803, no bid, Marcus Fava
Hobson Quay, 10 Hobson St, unit 3J, sold for $396,000, Dave Hamlyn & Marcus Fava
Parnell, Aero Apartments, 27 Cheshire St, unit 20, sold for $702,000, Chris Reeves
Eden Terrace, Newton Rise, 121 Newton Rd, unit 3B, sold for $600,000, Jan Honey
Herne Bay, 2A Buller St, unit 1, sold for $1.43 million, Robyn Clark & Peter Tanner
Herne Bay, 11 Sentinel Rd, no bid, Jock Kooger & Pawel Smuga
Mt Eden, 1 Akiraho St, unit 14, sold for $710,000, Summer Sun
Mt Roskill, 1370-1376 Dominion Rd, 2800m² development site, passed in at $3.8 million, Glenn Baker

Wairau Valley, 16 Link Drive, unit L, sold prior for $1.19 million at a 5.19% yield, Trevor Duffin & Ashton Geissler

7 intensive properties sell at Barfoots’ Wednesday auctions

7 of 18 properties in a range of intensity (apartments, suburban units, townhouses, cross-leased houses) auctioned at Barfoot & Thompson on Wednesday were sold under the hammer. Auction results:

Onehunga, 461 Onehunga Mall, unit 2, cross-leased, sold for $1.25 million, agent Paul Studman
Te Atatu South, 12 Poto Rd (house converted to 2 flats), no bid, Sharlene Huang
Glendowie, 14C Crossfield Rd, cross-leased, sold for $790,000, Jane Wang & Dragon Zhou
Remuera, 128A Upland Rd, cross-leased, passed in at $1.3 million, Dennis Dunford
Panmure, 51 Ireland Rd, unit 36, townhouse, passed in at $528,000, Rain Diao & Jane Chen
Mt Eden, 8 Graysons Lane, cross-leased, sold for $1.885 million, Repeka Lelaulu
Remuera, 103 Remuera Rd, unit 2, terrace, no bid, Ross & Joss Goodall
New Lynn, 1 Armstrong Place, unit 1, cross-leased, passed in, Aken Yuan & Michelle Zhou
Belmont, 13 Creamer Avenue, unit 3, cross-leased, passed in, Jonathan White
Meadowbank, 86 St Johns Rd, unit 2, cross-leased, no bid, Chase Liu
Mt Eden, 3 Akiraho St, unit 9, apartment, sold for $861,000, George Fong & Laura McAuley
Herne Bay, 15B Saratoga Avenue, cross-leased unit, passed in, Carl Madsen & George Damiris
Mt Eden, 25 Rossmay Terrace, unit 18, townhouse, no bid, Repeka Lelaulu
Howick, 47 Drake St, unit 2, cross-leased, sold for $850,000, Doug Lum
Epsom, 1A Merivale Avenue, unit, passed in, George Fong & Alex Wu
Avondale, 48 Eastdale Rd, unit 3, cross-leased, sold for $565,000, Francis Fan
New Lynn, 66 Arawa St, unit 2, cross-leased, no bid, Steve Su
Te Atatu Peninsula, 9B Tawa Rd, cross-leased unit, sold for $560,000, Emma Zhang

Attribution: Auctions, council.

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108 appeals on unitary plan

Submitters on Auckland’s unitary plan had lodged 105 appeals with the Environment Court & 3 with the High Court when the appeal period closed on Friday.

The High Court appeals on questions of law are by the Independent Maori Statutory Board on protection of mana whenua sites, Kiwi Property Group Ltd on the threshold change from a site to tenancy basis for allowance of office space, and the Waitakere Ranges Protection Society on replacement of the prohibited activity default status in the ranges with non-complying status.

The appeal period ran for 20 working days after the council publicly notified its decisions on 19 August.

Auckland Council appeals page
Environment Court appeals page

Attribution: Council release & website, Environment Court list.

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5 special housing areas approved

Commissioners have produced decisions approving 5 special housing areas at Ardmore, Clarks Beach, Drury South, Glenbrook, & Hobsonville Landing.

Auckland Council issued notices today making the applications under the housing accord with the Government operative.

The 5 areas:

  • Ardmore, plan variation 17, 170, 180 & 190 Walters Rd & 587 Mill Rd, 19.6ha rezoned from future urban to mixed housing suburban, to create 295 lots including 30 affordable housing sites
  • Clarks Beach, 137 Clarks Beach Rd, plan variation 19, 50.7ha rezoned from future urban to mixed housing suburban, 32 vacant lots, 2 residential superlots
  • Drury South, plan variation 16, 49 Harrison Rd & McEldownie Rd, 101ha rezoned from light industry to terrace housing & apartment buildings, mixed housing urban & mixed housing suburban, 50 residential lots
  • Glenbrook, plan variation 14, 35 & 127 McLarin Rd, 69ha rezoned from rural coastal to single house & local centre, to create 231 lots for residential, reserve & roading, neighbourhood park & coastal café
  • Hobsonville Landing, plan variation 12, 2ha to mixed-use zone, 6 new dwellings

Link: Auckland Council, special housing areas

Attribution: Council notices.

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Productivity Commission urban planning report blunt, measured & perceptive

The bluntest finding in the Productivity Commission’s draft report out last Friday, Better urban planning, is this: The planning system shows considerable evidence of unnecessary, excessive & poorly targeted land use regulations.

The commission issued its draft report, Better urban planning, for comment, closing Monday 3 October. Its final report to the Government is due on Wednesday 30 November.

2 more commission findings get to the heart of the planning quandary:

  • Many local authorities in New Zealand discourage or prevent the development of commercial activity outside designated centres. Local & international experience with such policies suggests that they often fail to achieve their objectives and can act as barriers to competition & productivity growth, and
  • In trying to protect existing city & town centres, some New Zealand urban local authorities have sought to reduce retail & commercial competition from other locations.

In a car-dominated world, centres built up with features such as a town hall, library & close-knit retail can be destroyed by powerful retailers buying cheaper land outside the centre – and eventually becoming more of a focal point.

Foodstuffs’ 17-year battle to get permission for a supermarket outside the recognised centres in Takapuna is one example of that conflict. In Morningside, the Warehouse used an old warehouse just outside the recognised “centre” for a new shop – and on Dominion Rd through Mt Eden there is no centre, just an extremely long retail strip. At Silverdale, the Warehouse held its development site for so long before building that it became part of a new retail village – one of about 5 scattered “centres” between the motorway ramps & Orewa.

The Productivity Commission’s conclusion: “The planning system has an inherent status quo bias & risk aversion.”

The commission cites the original intent of the 1991 Resource Management Act – enabling, not preventative, saying this status quo bias is reflected in “an overemphasis in the implementation of the Resource Management Act on managing or avoiding adverse effects, which does not sit well with the dynamic nature of urban environments”.

Call for a cultural shift

Down the list to the final chapter, the commission recommended: “A future planning system should place greater emphasis on rigorous analysis of policy options & planning proposals. This will require councils to build their technical capability in areas such as environmental science & economics. It would also require strengthening soft skills – particularly those needed to engage effectively with iwi/Maori.”

On the surface, that recommendation makes sense. Against history, however, it’s a hard change, because the commission is asking bureaucrats (highly skilled) to make subjective calls on developers’ proposals, instead of making those calls based on black & white rules – not the (historic) New Zealand way.

A recent example (still before the Environment Court) concerns Queen Elizabeth Square in downtown Auckland. The council proposed selling the square to adjoining landowner Precinct Properties NZ Ltd for inclusion in its new Commercial Bay development. Among opponents (because you can only oppose or support), Institute of Architects urban issues group chair Graeme Scott suggested changes which he believed would provide a better outcome. Our system doesn’t allow for that, but the commission’s proposal would engage people to take a wider view.

And its final recommendation is telling: “Central government should improve its understanding of urban planning & knowledge of the local government sector more generally. An improved understanding will help promote more productive interactions between central & local government.”

Our government got stuck in a party political rut in point-blank opposing the city rail link in Auckland, and also in opposing the council’s alternative funding methods to transform travel. In the last year, government & council have stopped talking past each other, so progress can be made.

Sharing windfalls

Among other recommendations, the commission said council should be able to participate in windfall profits arising from its own upgrades, and they should also be able to use a range of infrastructure delivery models: “A future planning system should enable councils to levy targeted rates on the basis of changes in land value, where this occurs as the result of public action (eg, installation of new infrastructure, upzoning).

“A future urban planning system should give councils the capability to use a wide range of innovative infrastructure delivery models, including public-private partnerships. Councils, either alone or through joint agencies, will need to develop the capabilities to operate such models successfully. Future arrangements could build on current regional shared-services initiatives that increase project scale and develop project commissioning expertise.”

Call was for blue-skies approach

Commission chair Murray Sherwin said in his release on the draft report: “The commission was asked to take a blue-skies approach to what a future urban planning system could look like. Well functioning successful cities matter a great deal to the wellbeing of New Zealanders. This is about giving people the opportunity to live in well designed, well supported cities that respond to growth & diversity.”

The commission said its report reflected the challenges of the current system and where changes are most needed. Mr Sherwin said the commission had no intention of adding another layer of complexity to what was already a very complex & often conflicted system: “There is no simple fix – it’s not just a case of changing legislation. Effective urban planning is about the right mix of legislation, people with the right skills and strong relationships.

“Urban planning helps to maximise the benefits of cities, by providing essential infrastructure services & community facilities and by managing conflicts between property owners. Yet too often, the connection between planning rules & the wellbeing of communities is weak or difficult to justify, and the supply of infrastructure & zoned land fails to keep pace with demand in our fast-growing cities.”

Some conclusions

The commission concluded that a planning system should allow urban land to be used for different purposes over time, provide enough land & infrastructure to meet demand, ensure that residents can move easily through cities, and protect the natural environment.

“Planning is where individual interests bump up against their neighbours’ interests, and where community & private objectives meet. It is inherently contested and difficult trade-offs sometimes have to be made. These decisions are best made through the political process, not the courts. Our current planning system tends to be adversarial & reactive to the views of well resourced & mobilised groups rather than the majority. We believe that any future planning system would have less regimented, but more targeted consultation requirements.”

“Central government needs to set stronger boundaries around planning, and councils need to allow people greater scope to decide how to best use their land, subject to clearly articulated requirements for protecting the natural environment, and include processes for addressing conflicts between neighbours. The commission has recommended the establishment of a permanent independent hearings panel to help councils ensure their plans meet legislative requirements.

“What we need is a responsive system that aims to deal with competing demands for resources, competing citizen interests & values. The commission’s draft report suggests how to achieve this.”


The commission recommends a future planning system should:

  • make a distinction between the built & natural environment, with clear objectives for each (chapter 13)
  • favour development in urban areas, subject to clear limits (chapter 7)
  • develop a Government policy statement on environmental sustainability to provide the boundaries within which urban development can occur (chapter 8)
  • provide narrower access to appeals and tighter notification requirements (chapter 7)
  • make spatial plans a mandatory component of the planning hierarchy (chapter 9)
  • establish a permanent independent hearings panel to consider & review new plans, plan variations & private plan changes across the country (chapter 7)
  • include more responsive rezoning through the use of predetermined price triggers to signal when land markets are out of balance and rezoning is needed (chapter 7); and
  • make greater use of targeted rates & volumetric charges to fund infrastructure investment & maintenance (chapter 10).

Productivity Commission, 19 August 2016:
What would a high-performing planning system look like?
Urban planning: What’s broken and how to fix it
Better urban planning, draft report

Related stories today:
Productivity Commission urban planning report blunt, measured & perceptive
Commission sees government change as essential for urban planning
Commission says everything English wanted on planning

Earlier story:
11 December 2015: Planning system is next Productivity Commission target

Attribution: Commission report & release.

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Commission sees government change as essential for urban planning

While Deputy Prime Minister & Finance Minister Bill English was congratulating the Productivity Commission on thinking just like him, the commission found the Government was a culprit – through inadequate legislation – in the failure to provide adequate infrastructure for growth.

The commission said: “Urban planning systems that effectively support the growth & evolution of successful cities:

  • ensure a sufficient supply of development capacity to meet demand
  • align land use rules with the supply of infrastructure (& vice versa) appropriately, and
  • provide the full suite of infrastructure assets required (city-shaping, structural & “follower”).

“New Zealand’s current system has struggled with all 3 tasks. The key sources of these problems are legislative arrangements that do not encourage integrated decisions, institutional & governance arrangements for water services that discourage responsiveness, and a lack of tools to resolve debates about large city-shaping projects.

“Proposed features of a future planning system outlined elsewhere in this report (especially changes to the regulatory system for land use as noted in chapter 7) will help to resolve some of these problems. But the commission sees the case for additional changes to help improve the performance of both the planning & provision of infrastructure. The first change is to give well conceived spatial plans greater legal status in Local Government Act & Resource Management Act plans & policies. “This is because spatial plans help to enable:

  • a high level overview and co-ordination among those responsible for supplying the various different sorts of infrastructure
  • those responsible for ensuring sufficient land for residential & business expansion, and
  • many other public & private parties with an interest in city growth & development.”

The commission praised the ATAP (Auckland transport alignment project) solution to resolving differences between central & local government:

“Fast-growing cities may sometimes need large, costly city-shaping pieces of investment that neither the NZ Transport Agency nor local councils are able to fund or finance out of their normal budgets. If these investments have wider benefits, as they sometimes will, then a partnership approach with central government is called for. The ATAP provides a promising governance model for these situations, and it could become a more formal part of a future planning system.”

Thoughts on efficient funding

The commission noted that efficient funding of infrastructure would enable infrastructure owners to cover the full costs from users & beneficiaries, and that this would require infrastructure providers to consider peak load pricing, connection charges & marginal cost of pricing.

However, the commission said: “Financial, legislative & political economy barriers are impeding the operation of efficient funding in New Zealand:

  • Councils argue that “growth does not pay for growth”, and available evidence suggests that infrastructure projects can fail to pay for themselves. Councils also face “demand risk”, where development fails to occur at the rate assumed when the project commenced
  • Current legislation limits the ability of councils to price wastewater use & road use, and to recover the costs of some community infrastructure through development contributions
  • Community resistance to higher council debt, rates increases & the pricing of water services limits the supply of infrastructure and constrains revenue sources.

“Some of these issues can be resolved by removing legislative barriers to pricing, making greater use of targeted rates to cover the costs of community infrastructure, and allowing councils to levy targeted rates based on land value uplift. Demand risk is best managed through the design, sizing & staging of infrastructure delivery

“Political barriers to infrastructure supply & charging could be partly addressed by creating a legislative expectation that councils should recover the capital & operating costs of new infrastructure from beneficiaries. Because of the technical issues involved in charging for some types of infrastructure, such an expectation would need to be subject to a practicality caveat.

Commission wants to explore funding options

The commission said it was interested in receiving evidence about the merits of exploring more far-reaching funding options, such as replacing or augmenting the rating system:

“One potentially desirable funding tool is the sale of development rights. This approach also has the potential to regulate intensity (eg, by restricting the number of multi-storey apartment blocks in an area) and provide revenue to fund associated infrastructure costs or additional services to ‘compensate’ affected communities.”

The commission said local bodies should be open to using a wider range of delivery models than the in-house or traditional outsourcing of construction that they commonly use: “Public-private partnership (PPP) delivery models or alliance contracting could be suitable for some transport & water infrastructure projects, and even for services such as street lighting.

“A future urban planning framework should provide institutions that give councils the capability to use a wide range of innovative procurement models, such as PPPs. The current expectation to consider PPPs for significant infrastructure projects could be extended to cover locally funded council works.”

Trunk infrastructure costs

Infrastructure costs by development density, assessed by the Centre for International Economics, a private economic research agency based in Canberra & Sydney.

Infrastructure costs by development density, assessed by the Centre for International Economics, a private economic research agency based in Canberra & Sydney.

Developers of new greenfield or infill sites usually provide local infrastructure within a subdivision, while councils provide extensions to trunk infrastructure. The commission said the costs councils incur to provide trunk infrastructure can be large: “For example, recently published research into the cost of infrastructure in Auckland showed that, on average, the marginal cost to Auckland Council of providing new infrastructure for housing in high density or infill areas is close to $30,000 for each lot. For low density or greenfield areas, the cost is close to $45,000 (Centre for International Economics, 2015).”

Efficient funding

On the issue of efficient funding, the commission 3 broad cost types that needed funding, and 3 pricing systems to consider – peak loading prices, connection charges & the marginal costs of infrastructure use.

“Ideally, governments will set prices for infrastructure [such as the 3 waters & transport] that encourage the efficient use of existing infrastructure and encourage timely investments in additional infrastructure capacity. A future planning system would therefore allow councils to recover the full cost of infrastructure from users.

“In this context, ‘full costs’ covers 3 broad cost types – operating costs (including maintenance), capital costs & spillover costs. It would also cover the cost of natural resources (eg, water) where infrastructure services provide resources for final consumption.”

Funding methods & legislative barriers

As an alternative to councils providing trunk infrastructure themselves and recovering costs through development contributions, developers can directly provide infrastructure through development agreements. Once completed, the infrastructure is vested in the council. In this case, the council doesn’t bear any capital costs for the infrastructure, but will need to meet ongoing maintenance & depreciation costs.

The commission said legislative barriers to volumetric charging for wastewater, and to the use of tolls & congestion charges to manage demand on existing roads, “impede the development of a more efficient funding system without clear rationales. They unnecessarily limit the revenue sources of local authorities & their ability to ensure the efficient use of their assets & resources.”

Centre for International Economics

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Attribution: Commission report & release.

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