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FAST-TRACKED URBAN DEVELOPMENT GIVEN THE THUMBS UP
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Last week the Government announced a plan to ‘trump’ the housing and infrastructure crisis.

The Ministry of Business, Innovation & Employment has released a discussion paper, which proposes new legislation to enable the acceleration of locally or nationally significant urban development projects.

How does it work?

Major projects (including housing, commercial developments, and associated infrastructure) would be facilitated by publicly controlled Urban Development Authorities (‘UDAs’) potentially in partnership with private companies or landowners. UDAs would be comprised of both local and national government, and would have extensive powers to:

  1. Assemble parcels of land (for example, to require councils and government entities to transfer their land for the project, and require some types of reserve land to be transferred, reclassified or to have their reserve status revoked);
  2. Prepare development plans, which would set out the activities that could occur as of right within the development area, and those activities which require further approval from the UDA (or council) or are prohibited;
  3. Plan and build infrastructure, including infrastructure which is not provided for in council plans and infrastructure outside of the development area (such as supporting trunk infrastructure);
  4. Buy, sell and lease public and private land and buildings, including compulsory acquisition of land through the Minister for Land Information;
  5. Borrow funding for infrastructure and levy charges to cover infrastructure costs; and
  6. Override existing and proposed district and regional plans (in appropriate cases).

The Discussion Document states that UDA projects will be nationally or locally significant projects which are strategic or complex, such as the Tamaki Regeneration Project. The powers would not be available to private developers that own small sites, nor would standalone infrastructure projects be eligible.

The UDA concept was recommended to Government by the Productivity Commission in its 2015 report Using Land for Housing. It is based on similar international models in Australia, the UK, the US and Hong Kong.

The idea has been around for over a decade, originating in a 2006 Ministry for the Environment report Catalysing Positive Urban Change in New Zealand and subsequently discussed in a 2008 Department of Internal Affairs discussion paper Building Sustainable Urban Communities.

The Government proposes a modified version of the Productivity Commission recommendation. The proposal is for councils and government to work together, with the possibility of a partnership with private individuals/companies. However, the Productivity Commission had envisaged government simply in a supporting role, with the focus of the UDA partnership between councils and private individuals (including private investors, and builders).  

Dr Nick Smith has described UDAs as “about providing new tools to enable redevelopment of existing areas in cities like Auckland and Wellington in a way that provides more housing, better infrastructure, and a stronger community” Read more about this here. UDAs are intended to align with other recent urban development initiatives, such as the ongoing proposed RMA reforms, the National Policy Statement on Urban Development Capacity, and the Housing Accords and Special Housing Areas (‘HASHA’) legislation.

The Productivity Commission’s 2015 report suggested that any legislation introduced for UDAs should follow the HASHA model. This model has proved to be successful by creating potential for significant volumes of housing. We see HASHA as a trial run for the structure and workability of the relationships required for successful UDAs. We would like to see the Government take heed of the Productivity Commission’s recommendation for UDA legislation to reflect the best parts of the HASHA model.

The UDA proposal is in its early stages, and the discussion paper leaves several key questions unanswered. For example, there is no indication of how much funding can be borrowed/ levied to cover costs of infrastructure over and above the current situation.

Who will the proposal affect?

The proposal is a major step towards a solution to the current housing and land development crisis. Essentially, the special powers given to UDAs will increase the supply of land for housing, and thereby assist with resolving housing unaffordability. The powers would be available throughout New Zealand (not restricted to any particular geographic location).

The proposal will affect a wide variety of businesses, landowners, communities and infrastructure providers. In particular, it will be important for all businesses and organisations involved in infrastructure and development to become a part of the discussion and decision-making process. Requiring authorities (such as Auckland Transport, Watercare, Transpower, or the NZ Transport Agency) with designations within the development area could have those designations revoked or changed.

The proposal anticipates government, councils, infrastructure providers, iwi, affected residents and the general public to all be involved at different stages of UDA project development. The final decision on any UDA project would rest with the Minister responsible for the legislation, who is yet to be appointed by the Prime Minister.

How to get involved

The discussion paper is open for submissions until Friday 19 May 2017. A link to the discussion document is here.

If you have any questions about this discussion paper, making a submission, or any resource management issues that we can help you with, please do not hesitate to contact Nicky McIndoe.

This article was authored by Marija Batistich, Special Counsel, and Louise Trevena-Downing, Solicitor, in our Environment and Planning team.

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Nicky McIndoe
Nicky McIndoe

Partner

Wellington and Auckland

+64 4 915 0818

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