Analysis: Compared with being cloistered in the National Party caucus room, it must have been refreshing for Simon Watts to throw on the hi-vis (as you do) and get out on a big construction site south of Auckland this week.
He was visiting NZX-listed Kiwi Property’s big Drury residential development and metropolitan centre. It’s 53ha on which the company plans to build thousands of homes, scores of office buildings and a metropolitan town centre with buildings up to nine storeys high – with provision to go beyond 20 storeys.
The Local Government Minister has become adept at shooting 360 degree selfie videos for his social. “You can see behind me significant investment,” he says. “There’s the motorway right in behind, so great access to get in and out. Obviously, a little bit more infrastructure required, and if we keep swinging right around, you’re going to be able to see the train station, Drury train station, that we opened only last weekend. As you can see, great connectivity.”
This metropolitan centre was approved through the fast-track late last year, after a long battle with Auckland Council over the developers’ plan change application. The council said it couldn’t afford to budget $1b-plus for transport infrastructure, stormwater, sewerage, parks and community facilities in the remote greenfield area. But in the end it conceded defeat.
The council’s since green-lit a $2.3b funding and long-term development contribution framework for the wider Drury-Opāheke growth area to support the expected influx of 60,000 residents; less than half that money can be claimed back from development contributions.
Auckland initially lost in the Environment Court; by the time the project got to the fast-track last year, it had conceded defeat. And as it turned out, this was just the first of many defeats for Auckland and other councils. This highlights a big problem with the fast-track that councils – especially Auckland and Queenstown – have been flagging up with ministers.
I wrote about this last week. Developers are bypassing council planning and consenting processes to bulldoze their projects through the fast-track. Which speeds up the process, and is fine so long as the fast-track panels are doing a thorough and conscientious job. In my view, most panels have done just that.
They aren’t required to comply with city and district plans, but often they do. They aren’t required to consult widely in the community, but mostly they do.
The problem, though, is those occasions when they do sign off outlier projects – like the 1200-home Delmore development in Orewa, north of Auckland, that a panel approved this week. Watercare can’t fully connect it to wastewater until 2050, so the community will have to truck in drinking water and truck out sewage for limited periods each year. Mayor Wayne Brown said it made a mockery of the fast-track law.
The erstwhile building and construction minister, Chris Penk, raised similar concerns about a development at Waimauku, in his electorate. (The developers no longer need to worry about his opposition.)
I’ve reported similar problems in districts like Matamata-Piako, Waimakariri, Selwyn and, most of all, Queenstown Lakes.
I put this exact conundrum to Watts last month. Given the misalignment of many applications (and some decisions) with council plans and budgets, were there any adjustments the Government could make to the fast-track process? “Well, absolutely,” he replied.
We discussed this – and true to his word, some of those mayors got phone calls from Watts or Chris Bishop this morning. They revealed the Government is close to announcing details of a new Development Levies system, to be passed next Parliamentary term and becoming operational from 2029.
But in the meantime, the mayors were told, ministers will hastily push through changes to the Local Government Act 2002, to enable councils to increase the development contributions they impose for future fast-track developments.
“Some fast-track developments can still put pressure on the wider infrastructure network, beyond what council can currently recover, and the changes we are announcing today recognise that reality,” Bishop says.
Queenstown Lakes Mayor John Glover says his call from Chris Bishop this morning was very welcome. The change will help councils pay for pipes and pumps and other expensive infrastructure to serve new greenfield communities that are approved for construction outside existing schedules and budgets.
The changes are intended to address situations where developments proceed ahead of infrastructure planning or create infrastructure impacts across council boundaries.
Glover hopes the Government will also extend to NZ Transport Agency the same ability to claim back more from developers, so it can also upgrade state highways and junctions to serve thousands more cars and trucks.
But there’s a catch. It won’t apply to the long list of 217 projects already submitted to, or approved by, the fast-track expert panels.
Like Delmore. Or Waimauku. Or Ashbourne near Matamata. Or, near Queenstown, the 1200-home Homestead Bay development and the 900-home Gibbston Village project.
It’s also likely there will be a deluge of new applications in the next few weeks, ahead of the law change being passed next month. For instance, the 1250-home Ridgeburn development, on a greenfield site between Queenstown and Arrowtown, has been withdrawn pending changes; the developer will be motivated to get the amended application back in before the law changes.
Glover visited the Ridgeburn site three weeks ago. “Standing there, you try and visualise how the existing challenged roading networks would cope with all the extra vehicles,” he tells me. “I think a lot of people are just sort of struggling to comprehend how can that work.”
The very reason people want to live there is the reason the district can’t make it work. It’s beautiful, rugged and remote. “It’s the lovely rural landscape everyone comes to Queenstown Lakes District to see. The challenge is when you hit the the state highways, which are already maxed out at times.”
I’ve criticised the use of retrospective law changes like the bill extinguishing companies’ climate liability in the Mike Smith case – so it would feel a bit hypocritical for me to turn around now and argue for this morning’s fast-track changes to be retrospectively applied to approved applications like Delmore. The proper place for councils to challenge those is the courts.
But I think there’s a strong argument that applications that have not yet been approved, when the law change comes into effect in mid-September, should be subject to the increased development contributions to enable councils to recover their costs.
As the ministers like to say, growth should pay for growth.
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