Wollondilly Council is urging the New South Wales government immediately halt any plan to rezone land at Appin as part of a major housing expansion south-west of Sydney.
Housing giant Walker Corporation has previously outlined a proposal to pour 50,000 people into the semi-rural village as part of the state government's Greater Macarthur growth corridor.
The project has been described as a solution to Sydney's housing crisis.
Newly elected Wollondilly Mayor Matthew Gould has made responding to the project one of his first priorities.
"We are very concerned the state government is about to rush through a quick rezoning of that area and there simply is not the infrastructure," he said.
The council is on the record as criticising the government's failure to ensure water, sewerage and transport infrastructure is in place for the nearby housing development at Wilton.
Major earthworks and clearing has started for construction of 15,000 homes on land around Wilton, also in the Wollondilly Shire, as part of the Greater Macarthur corridor.
Sydney Water has not yet resolved water or sewerage plans for the Wilton precinct and developers have instead been allowed to install four temporary treatment package plants.
"We still don't have infrastructure certainty at Wilton, so I don't see how we are possibly going to get anything better, particularly when it's been done under this secret process," Mr Gould said.
'Secret process' causes alarm
Mr Gould said the council also had significant concern its staff had been asked to sign a secrecy clause with the Technical Assurance Panel (TAP).
The Appin development is one of two projects to pilot the use of the TAP group to resolve key local, state and strategic issues for the development.
"Unfortunately, the Department of Planning has made our staff sign non-disclosure agreements, so they have not been able to tell the governing body what we need to know," Mr Gould said.
"It is absolutely ridiculous.
"We call on the state government very quickly to remedy it and come brief councillors and make councillors aware of what is going on."
Koala concern
Meanwhile, the council called on the government to recognise the Commonwealth's recent decision to list koalas as an endangered species and better protect the local colony.
"We know that we have the only chlamydia-free colony [in NSW] over in that Appin area, and we don't have any certainty they are properly protected," Mr Gould said.
"We are calling on the state government to once again recognise, preserve and protect the koala habitat in the area and Wollondilly more broadly."
Lack of transparency reaches 'crisis' point
Brian Williams from the Wilton Action Group welcomed what he described as a strong move by the council.
"The issues of population, roads and particularly water infrastructure are critical to this, and there doesn't seem to be any clarity to this."
Mr Williams said the use of the non-disclosure clause should be investigated.
"I am wondering if this is a breach of the Local Government Act. I have never heard of council staff excluding the councillors from being able to discuss the key projects they are involved in.
"This is not on."
Department refuses to lift secrecy clause
A Department of Planning and Environment spokesperson said the department would continue to work with councils and the community to deliver a long-term pipeline of new homes in communities well supported by infrastructure.
"Work on the long-term vision for the area has been underway since 2015, with the Greater Macarthur 2040 interim plan, released in 2018, showing the area is suitable for more homes," they said.
"Any future plans will be subject to detailed community consultation and continued work with the council.
"Wollondilly Council staff are part of the technical assurance panel to resolve potential planning issues prior to the preparation of any plans to rezone land in Appin. When there is a draft plan, elected councillors will be briefed and consulted."
