Land and Environment Court New South Wales

• Medium Neutral Citation: Olsson v Ashfield Municipal Council [2012] NSWLEC 1073
• Hearing dates: 1-2 March 2012
• Decision date: 28 March 2012
• Jurisdiction: Class 1
• Before: Morris C

Decision

Appeal upheld in part

• Catchwords: Development consent, public benefit, whether any credit for the provision of the public benefit should be allowed, s94 contributions.
• Legislation Cited: Environmental Planning and Assessment Act 1979; Ashfield Local Environmental Plan 1985; State Environmental Planning Policy No. 1
• Cases Cited: Cavassini Constructions Pty Ltd v Fairfield City Council [2010] NSWLEC 65; North Western Surveys Pty Limited v Penrith City Council [2012] NSWLEC 1017
• Texts Cited: Ashfield Development Control Plan 2007; Ashfield S94 Development Contributions Plan 2010
• Category: Principal judgment
• Parties: Russell Olsson (Applicant); Ashfield Municipal Council (Respondent)
• Representation: Counsel; Mr J Ayling SC with Dr S Berveling (Applicant); Solicitors; Mr P McLachlan; McMahon Thorpe (Applicant); Mr P Jackson; Pikes Lawyers (Respondent)
• File Number(s): 11131 of 2011

Judgment

1 Development consent 10.2010.301.1 was issued by Ashfield Council on 1 July 2011 and authorises the demolition of an existing commercial building, tree removal and construction of 2 x 8 storey mixed use buildings with associated car parking at 2A Brown Street Ashfield. The development application was lodged under provisions of the Council's Development Control Plan that provided for additional height, where a public benefit is included as part of the application in this particular case. A public car park was included within the development as a public benefit and the consent provides for an additional two storeys in each tower building. Conditions requiring dedication of the carpark are imposed in the consent and separate conditions under s 94 of the Environmental Planning and Assessment Act 1979 (the Act) requires the payment of contributions for public services and amenities required as a result of the development.

2 Mr Olsson, the architect for the development, has filed an appeal against condition C(11) and is seeking its deletion. That condition is the condition requiring payment of s 94 contributions. The contentions in the case are whether the contributions should be imposed or reduced to take into account the building that was erected on the site at the time consent was granted and whether any form of credit should be provided to offset the cost of providing the car park.

Background and the proposal

3 In 2004, the Council granted consent to another party for a master plan redevelopment of the site that included subdivision, demolition of an existing car park and single storey portion of an existing office building and construction of a new multi-storey mixed residential/commercial building. Whilst not stated in the consent, it operated as a staged approval, and the land has been subdivided and some demolition has been undertaken. The main building works authorised by this approval have not commenced and were to be the subject of a further development application. That application was not lodged.

4 It is apparent from the evidence provided, particularly that contained within the Council's Bundle of Documents (Exhibit 2), that the development the subject of the application has evolved largely from the background planning that had been undertaken by the Council and the previous proponent.

5 The development application was lodged with the council on 6 December 2010 and ultimately determined by the Sydney East Joint Regional Planning Panel on 1 July 2011 following a series of amendments required by the Panel after its original consideration of a larger proposal. The consent issued authorises the following works:

Demolition of existing commercial building, tree removal and construction of two (2) x 8 storey mixed use buildings comprising of:

• Building "A" 8 storey predominantly fronting Brown Street;
• Building "B" 8 storey located behind building A and predominantly fronting to Drakes Lane;
• Three retail and one supermarket tenancy at the ground floor;
• Five basement parking levels accommodating 282 vehicles inclusive of two levels of public car parking spaces on basement levels B2 and B3 that will be dedicated to Council for use by the general public.
• Loading/unloading and waste room on ground level.
• 120 residential apartments comprising of 26 x 1 bed, 79 x 2 bedroom, 4 x 2 bedroom + mezzanine, 6 x 3 bedroom and 5 x 2 bedroom self office/home office apartments
• A public through-site link from Brown Street to Drakes Lane via a lift and stairway access; and
• Colonnade along Brown Street elevation

6 The applicant is seeking the deletion of condition C(11) from the consent. That condition read as follows:

(11) Section 94 Development Contributions

In accordance with section 80A (1) of the Environmental Planning and Assessment Act 1979 and the Ashfield Council Development Contribution Plan, the following monetary contributions shall be paid to Council prior to issue of a construction certificate to cater for the increased demand for community infrastructure resulting from the development.

 

CONTRIBUTIONS (NEW DEVELOPMENT)
	Residential Accommodation less than 60sqm GFA	Residential Accommodation between 60-84sqm GFA	Residential Accommodation greater than 84sqm GFA	Retail Shops (per sqm)	Sub-Total
Number of Dwellings	22	21	77	740 sqm	N/A
Local Roads	$2,944.69	$2,810.84	13,169.31	$12,105.95	$31,030.79
Local Public Transport Facilities	$9,419.78	$13,864.93	$72,482.01	$2,863.80	$98,630.52
Local Car Parking Facilities	$0.00	$0.00	$0.00	$0.00	$0.00
Local Open Space and Recreation Facilities	$165,652.24	$243,822.63	$1,274,637.10	$111,584.60	$1,795,696.57
Local Community Facilities	$10,232.62	$15,061.33	$78,736.48	$0.00	$104,030.43
Plan Preparation and Administration	$7,526.48	$11,078.19	$57,913.71	$5,061.60	$81,579.98
TOTAL	$195,775.82	$286,637.92	$1,496,938.61	$131,615.95	$2,110.968.30

If the contributions are not paid within the financial quarter that this consent is granted, the contributions payable will be adjusted in accordance with the provisions of the Ashfield Development Contributions Plan and the amount payable will be calculated on the basis of contribution rate applicable at the time of payment in the following manner:

$Cc = $ Cp x CPIc

               CPIp

Where:

$ Cc is the amount of the contribution for the current financial quarter

$ CP is the amount of the original contribution as set out in this development consent

CPIC is the Consumer Price Index (Sydney - All Groups) for the current financial quarter as published by the ABS.

CPIp is the Consumer Price Index for the financial quarter at the time of the original consent.

Prior to payment of the above contributions, the applicant is advised to contact Council's Planning Division on 9716 1800. Payment may be made by cash, money order or bank cheque.

Council's Development Contributions Plan may be viewed at www.ashfield.nsw.qov.au or a copy may be inspected at Council's Administration Centre.

7 Whilst not the subject of the appeal, conditions A(2), A(3) and A(4) are also relevant. These state:

(2) Dedication of land to Council

Basement levels B2 and B3 which provide public car parking, shown respectively on drawings 0912.DA05, Issue B May 2010 and drawing 0912.DA04, Issue B May 2010 shall be dedicated to Council, free of all costs to Council, to be available to members of the public for use as a public car park, the fee simple of which shall be vested in the Council (" the public car park land"). The public car park land shall not include residential lobbies, residential storage, nor residential car parking or bicycle storage spaces.

(3) Creation of stratum allotment for the public car park land

The land which is the subject of the development consent shall be subdivided to include a stratum subdivision so as to create one stratum allotment for B2 and B3 which will be the public car park land.

A certificate of occupation shall not be issued for the whole of the development the subject of this consent until the Applicant for consent or any successor in title, at its costs, obtains development consent for the stratum subdivision of the public car park land and the stratum allotment is transferred to Council, in fee simple, at no cost to Council.

(4) All essential services to be provided to the car park land prior to dedication.

The public car park shall contain, at no cost to Council, all essential services including fire services, drainage/stormwater services, ventilation services, line marking, service meters, energy efficient lighting services and be fully compliant with all relevant provisions of the Building Code of Australia, at the time the land is transferred to Council in accordance with condition 3 above.

Part of the essential services which are to be installed within the stratum allotment and be operational at the time of transfer of the land to Council include a " time stay" system, which will control the length of stay for each car park user of the public car park land. The Applicant or its successor in title shall be responsible for the maintenance and upkeep of all essential services, including the "time stay" system within the stratum allotment for B2 and B3 forming the public car park land.

The proposed lighting services shall be approved by Ashfield Council prior to issue of the Construction Certificate. The proposed lighting system shall be energy efficient, achieving the highest energy rating available.

The contentions

8 The applicant contends that condition C(11) is unreasonable in the particular circumstances of the case and should be deleted. The reasons given are:

• The contribution failed to take account of the public benefit derived from a " works-in-kind" contribution by the approved development for the purposes of public car parking.
• The provision of the public car parking pursuant to condition A(2) of the consent will construct all public car parking facilities for which a contribution is sought (which are limited to the public car parking provided on this subject site) under Council's S 94 Development Contributions Plan 2010.
• The development should be credited with the value of the public car parking that is required to be provided pursuant to condition A(2) of the consent. Even applying only the rate from the S 94 Plan or $30,000 per car space, the effect of this change would be to reduce the required contribution by $2,940,000 (which exceeds the contribution is sought).
• The public car parking that is required to be provided pursuant to condition A(2) of the consent is an" in kind" contribution and comprises all of the public car parking works identified in the S 94 Plan, as envisaged pursuant to sections 2.4.2 and 2.4.3 of that plan.

9 In the alternative, the applicant contends that the amount of monetary contribution required to be paid pursuant to condition C(11) is not in accordance with the s 94 Plan and should be reduced. This is because he says no allowance was made for the existing commercial floor space on the subject site, as required by clause 2.8 and Appendix E of that plan.

10 The council agrees that the quantum of the contribution should be reduced to reflect the existing commercial floor space however does not agree on the amount of that reduction. It says the condition should be retained at the reduced rate because the provision of the carpark was at the developer's initiative, was a public benefit provided to offset the additional storeys provided in the development and that because the condition to provide the carpark is imposed under s 80(A)(1)(a) of the Act, there is no link to the s 94 plan or condition C11 that was imposed under s 94(1). It says the carpark is not a "works-in-kind" as defined in the contributions plan, is not a work anticipated under that plan and will address a current parking shortfall rather than provide parking required as a result of future development.

The site and its context

11 The site has an area of 3687 square metres and is located within the street block bounded by Brown Street, Hercules Street and Liverpool Road, directly opposite Ashfield Railway Station and within the core of the Ashfield Town Centre. It has the main frontage to the western and southern sides of Brown Street and secondary frontage to Drakes Lane. The land falls towards the northern end of Brown Street, where it levels off opposite the station.

12 The site incorporates an existing electricity substation at its southern corner and adjoins a seven storey commercial building to the south west. To the east of the site on the opposite side of Brown Street is an eight storey mixed-use development and to the north west on the opposite side of Drakes Lane is the rear of properties in the Hercules Street commercial strip. An at-grade commuter car park is located diagonally opposite the site.

The planning controls

13 The site is zoned 3(a) General Business under Ashfield Local Environmental Plan 1985 (the LEP). Ashfield Development Control Plan 2007 (the DCP) also applies to development of the site. Of particular relevance to the application is clause17B of the LEP which provides a floor space ratio (FSR) control for the subject site of 2:1 with a 1:1 bonus, allowing a maximum FSR of 3:1 on the basis that the extra floor base is used for residential purposes and Council is satisfied that the additional development, which increases the FSR above 2:1 does not have an adverse impact on any of the following:

(a) the scale and character of the streetscape;

(b) the amenity of any existing or potential residential units on neighbouring land:

(c) sunlight access to surrounding streets, open space and nearby properties;

(d) Wind flow patterns to surrounding streets, open space and nearby properties

14 In addition, Map 2 of the DCP identifies the site as having a 6 storey height limit with Map 3 offering a 2 storey height bonus if it can be demonstrated that the development provides a public benefit. It is on the basis of these clauses that the approval has been issued with the public benefit being the public car park incorporated on basement levels 2 and 3. The DCP does not define the term 'public benefit' nor provide any guidance as to any qualitative or quantitative assessment of that benefit in terms of a particular development proposal.

15 A report entitled Appraisal of SEPP 1 Variations 223-237 Liverpool Rd, Ashfield DA No. 331/2002 and tendered as Exhibit C, is an assessment of a range of matters relevant to the original masterplan consent and contains an assessment of the value of the carpark and the additional two storeys proposed within that development to assist the council in determining whether the public benefit proposed by the applicant at that time met the requirements of the DCP and was reasonable, concluding that it was.

16 The number of spaces to be dedicated became a contention during the proceedings on the basis of the Council anticipating 84spaces, however, the condition requiring the dedication of all of the space at the two basement levels, with the exception of those separately accessed as resident parking, would provide for 96 spaces.

17 As the development exceeded the FSR, an objection to that development standard pursuant to the provision of State Environmental Planning Policy No. 1 (SEPP1) was submitted and found acceptable by the Council and the JRPP. The additional two storeys above the six storey height control were approved under the DCP provision, and did not require an objection as it was agreed that the control is not a development standard.

The S94 Plan

18 Ashfield S94 Development Contributions Plan 2010 (the S94 Plan) was adopted on 9 November 2010 and commenced on 16 November 2010, approximately three weeks prior to the lodgment of the application. Accordingly, it is the plan that is relevant to the application. That plan enables the council to levy contributions from development for the provision of community infrastructure that is required to meet the demands of that development and has been prepared to address a ten year time frame from 2010 to 2020 when Ashfield Council anticipates an additional 1,330 additional private residential dwellings will be constructed in its local government area accommodating an additional 2,563 residents. In addition, it estimates there will be an approximate increase in retail floor space of approximately 8.650sqm, commercial space of 18,175sqm and bulky good retail floor space of 26,500sqm generating an additional 1,675 workers. The quantum of contributions increased from those payable under the former contributions plan.

19 Funds collected under the plan would facilitate the provision, expansion or augmentation of local roads, public transport facilities, parking facilities, open space and recreation facilities, community facilities and a plan preparation and administration charge.

20 Of relevance to the application is the levy for car parking. The Court notes that condition C(11) does not include any contribution towards the provision of that facility and that is because the development provides for all of its parking needs on-site.

21 The carparking works described in the s 94Plan are reference code CP-001 and described as Brown Street - multi storey car park (95 spaces). The full cost of that development would not be recovered through levies as the carpark is also intended to cater for additional commuter parking. The amount proportioned under the s 94 Plan is $2,850,000, and the timing between 2016 and 2018.

22 Section 4.3 of the s 94 Plan relates to public car parking. The projected development within the area is estimated to generate a demand for 95 additional off-street public car parking spaces at a cost of $30,000 per space and accordingly the levy is charged where non-residential development is unable to provide car parking on site. Residential development will continue to be required to provide 100% of Council's off-street car parking requirement.

23 Clause 4.3.3 outlines the Council's strategy for addressing the additional demand for off-street parking by the provision of centralised car parking in the town centre to limit driveways and vehicular access points crossing footpaths and/or conflicting with pedestrian priority areas. It is intended to pursue a multi-storey car parking facility on the site of the existing State Rail car park to cater for the existing commuter parking as well as the additional public car parking demanded by future non-residential development town. The location of the proposed facility is identified on the map at Appendix C to the plan. That plan shows the location of the existing at-grade commuter car park within the State Rail corridor that is referred to in [12] above.

24 Also of relevance to this matter, are the provisions of the s 94 Plan that provides for the dedication of the land and material public benefits/'works-in-kind'.

25 Clause 2.4.2 relates to the dedication of land and states:

In accordance with the provisions of this plan, Council may require that land be dedicated as a form of contribution toward the provision of community infrastructure. Where such dedication is required, it must be undertaken in accordance with the following:

The dedication of land is to occur at the same time as payment of monetary contributions applicable to any development consent granted for the land and in all the circumstances, prior to occupation of the development;

The dedication of land is to be ' free of cost' - meaning that all costs associated with the dedication of the land and its transferred to Council's ownership to be borne by the applicant/developer;

At the time of transfer, the land should be in a condition which is suitable for its identified public person and should be cleared of all rubbish and debris and have a separate title.

26 Clause 2.4.3 relates to material public benefits and "works-in-kind" and states:

Council may accept an offer by the applicant to provide an 'in-kind' contribution (i.e., the applicant completes part or all of the work/s identified in the Plan) or through provision of another material public benefit (other than the dedication of land). In lieu of the applicant satisfying its obligations under the plan.

Council may accept such alternatives in the following circumstances:

(a) the value of the works to be undertaken is that least equal to the value of the contribution that would otherwise be required under this Plan;

(b)the value of the works to be substituted must be provided by the applicant at the time of the request and must be independently certified by a Quantity Surveyor who is registered with the Australian Institute of Quantity Surveyors or a person who can demonstrate equivalent qualifications;

(c)the standard of the works is to the Council's full satisfaction;

(d)Council will require the applicant to enter into a written agreement for the provision of the works;

(e)the provision of the material public benefit will not prejudice the timing or the manner of the provision of public facilities included in the works program; and

(f)it must not result in piecemeal delivery of local road works or likely result in the need to reconstruct the works due to likely future adjacent development (i.e., normally the works will need to relate to a whole street block or a defined precinct)

A 'works-in-kind' relates to the undertaking of a specific or equivalent work specified in the contributions plan, and is therefore more readily capable, in comparison to other material public benefits of meeting the above criteria. In accepting other material public benefits, Council must be satisfied that the offer provides a substantial benefit to the community not envisaged by the plan and that is benefit warrants Council accepting responsibility in fulfilling the intent of the Plan, notwithstanding a reduction in expected cash contributions.

27 Appendix A Of the S 94 Plan provide a glossary of the terms used in the plan and provides the following definition of "works-in- kind: That means

the carrying out of work which is identified in the costed works schedule which form part of this contributions plan in return for a reduction in the amount of monetary contributions (but not a reduction in the total quantum of contributions) required for the same category of contribution.

The evidence

28 Expert evidence was heard from:

	Applicant	Council
Town planning	Mr Fletcher	Mr Mackay
Construction costs/QS	Mr Dakhoul	Mr Hill
Valuation	Mr Dempsey	Mr Hill

29 In addition, the applicant and architect for the project, Mr Olsson, a representative of the owner, Mr Nasif and a council officer, Mr Bas provided evidence in relation to the number of spaces to be dedicated and the reasons that this had increased from 84 to 96 spaces. There evidence was contradictory however, Mr Jackson, for the council, advised the Court that the council has always only sought the dedication of 84 spaces and no additional spaces were required to fulfil the commitment of the public benefit as proposed by the applicant in its development application and detailed in the supporting Statement of Environmental Effects.

30 Mr Hill and Mr Dakhoul provided an assessment of the construction costs for the car park and agree that the unit rate for each space is $38,606. They agreed that the costs of constructing the carpark within the development would differ from the costs the council would use to calculate the contributions in its s 94 plan due to the different construction techniques proposed. In particular, the five level basement was said to be more expensive to construct than the decked car park and, similarly, it would also be cheaper if a three level basement was proposed. Mr Hill estimated a 2 level basement would cost in the vicinity of $25,000 per space and Mr Daykhoul said to be cost may range from $20-$30000 per space. The court notes that these costs do not include land value.

31 The planning experts were asked to consider whether it is likely that the site could be developed to the maximum 3:1 FSR within the six-storey height limit that applies to the site. Mr Fletcher says there is scope to increase the FSR at the podium level of the building and provide a different mix of commercial and residential floor space. Mr Mackay agrees there are a number of different development options that would achieve the 3:1 and said that the new area would have to be within the podium as it is unlikely that it could be accommodated within the towers and meet appropriate planning considerations.

32 Whilst Mr Fletcher accepts that the car park does not meet the definition of "works-in-kind" as defined in the s 94 Plan he does consider that it would replace a work identified in that plan and deliver a material public benefit by bringing forward the construction of the car park. Mr Mackay said that the car park to be constructed, utilising the section 94 funds is to provide for parking that is not provided for in future development within the Ashfield Town Centre and that would be constructed on the State Rail site in accordance with the provisions of the plan. He says the public benefit achieved by the dedication of the car park within the site would address the current parking shortfall within the Ashfield Town Centre and reflects the offer of the applicant to provide the carpark on the basis of achieving additional building height.

33 The experts agree that the car park to be constructed within the development is not identified as the proposed local car parking facility within the s 94 Plan and that it is proposed by the applicant in pursuit of bonus GFA/height. For that reason, Mr Mackay is of the opinion that no credit should be granted as he said the application included the public benefit in pursuit of that bonus height, and there is a disconnect from the monetary contributions payable in accordance with condition C(11). He says that if a credit in the nature proposed by the applicant were granted, the result would be a zero monetary contribution from the proposed development, which would result in Council receiving no contribution from the development to contribute towards the traffic, open space and recreation or community service facility demanded by future resident and worker population of the proposed building. He said this would be unreasonable as it would reduce the capacity of existing public facilities and services to cater for the existing resident and working communities of the Ashfield LGA and prejudice the provision of public facilities included in the contributions plan works program. He contends that the public car parking contribution envisaged by the plan is to cater for future circumstances where non-residential development in the town centre is unable to comply or where it is not desirable for it to comply with on-site car parking requirements.

34 Mr Fletcher said the provision of the 99 car parking spaces to be provided as a consequence of condition A(2) will more than satisfy the total demand identified in the s 94 Plan for the timeframe of that plan and as a consequence, Ashfield Council will be able to defer any expenditure involved in provision of the multi-storey car parking facilities proposed under that plan until at least 2020 and possibly longer and that the savings could be applied by the Council to the provision of other public facilities and services.

35 They also agreed that an allowance should be made for the existing development on the subject site prior to it having been vacated for the purposes of the development and that that reduction should be calculated based on the rates per worker and per Daily Vehicle Trip (DVT) as specified in this table on page iii of the Council's s 94 Plan, indexed using the December 2011 quarter CPI (Sydney All Groups) to 9 February 2012. The rates would equate to $4182.56 per worker and $30.81 per DVT. In determining those rates that should be applied, Mr Mackay relies upon 1986 development consent plans whereas Mr Fletcher relies on more recent complying development certificates for occupation and fit out of the building and recent survey details.

36 Applying Mr Mackay's formula, the net contribution would be reduced from the 1 July 2011 rate included in condition C11 of $2,110,968.30 to $1,864,879.03 and using Mr Fletcher's evidence that amount would be reduced to $1,555,504.96.

37 The valuers undertook an assessment to compare the value/financial benefit to Council of the two levels of public car parking and the value/financial benefit to the developer of the extra floor space in the form of two and three additional levels (buildings B and A respectively). This exercise was similar to that referred to in [15] as part of the original masterplanning for the site.

38 They agreed that both the approved scheme and a scheme without building the two additional car park levels are financially viable, that without the additional two car park levels a greater profit of $4,535,424 would be made by the developer and conclude that this reflects the value of the car park to the Council. Undertaking an assessment of the development options for the site based on a 3:1 FSR, the valuers have assumed that parking for 177 cars would be required and the site would yield 107 units. Comparing the latter with the approved development, they say, the profit to the developer is $553,089 greater.

39 Mr Dempsey concludes that the car park value and the additional profit should be added so that the benefit to Council of car park levels B2 and B3 is the sum of these two components being $5,126,668. Mr Hill says the right number is $553,089 worse off doing the approved scheme as the cost of the car park is built in and that the current proposal can be undertaken with a lot less risk because 56 of the units are already sold off the plan. Mr Dempsey maintained that developer is subsidising the scheme to the extent that Council gets a car park worth around $4.5 million with the developer subsidising that outcome by $500,000. However, Mr Hill says that there is a need to distinguish between the benefit to the Council and benefit the developer, and that the benefit to the Council is 84-99 carspaces as a public car park and adopts a replacement cost. He also says that if the Council elected to put the carpark elsewhere it would be cheaper.

Conclusion and findings

40 Section 94 of the Act provides that if a consent authority is satisfied that development for which consent is sought is likely to require the provision of or increase the demand for public amenities and public services within an area a condition may be imposed on that consent requiring the dedication of land free of cost and the payment of a monetary contribution or both. Condition C(11) is made in accordance the provisions of s 94(1)(b) and there is no dispute between the parties that the condition is validly imposed.

41 The applicant is seeking to offset the cost of providing the public car park in the development against the contribution sought to be imposed by the Council under Condition C(11). In addition, it is seeking the reduction of the quantum of that contribution to take into account the development of the site.

42 The Council does not dispute that the quantum should be reduced to reflect the approved floor space of the existing building and that such would be consistent with the provisions of its s 94 Plan. What is in dispute is the amount that the contribution should be.

43 Having regard to the evidence of Mr Fletcher and Mr Mackay, I prefer the evidence of Mr Fletcher that the existing built form should be applied when calculating the credit he attributed to floor space of the whole of the building. That is based on survey data that was not refuted and more recent approvals than those relied on by Mr Mackay. Accordingly, I agree that the contribution to be levied under condition C(11) should be $1,555,504.96 based on rates calculated as at 1 July 2011.

44 My Ayling, for the applicant, contends that the council, and in this case the Court, has the discretion to apply a condition requiring the payment of a contribution or not and that, despite the existence of the s 94 Plan, there is no statutory duty to impose a condition that requires any payment. I agree. He further contends that to apply the condition in the circumstances of the case, where the cost to the applicant of providing the carpark exceeds both the value of the carpark to the council as evidence by Mr Dempsey and the total payment due under that condition, is unreasonable.

45 S 94B (3) provides that a condition under s 94 that is of a kind allowed by contributions plan may be disallowed or amended by the Court on appeal, because it is unreasonable in the particular circumstances of the case even if it was determined in accordance with the relevant contributions plan. Therefore, the test in this matter is whether the application of condition C(11) is reasonable circumstances of the case.

46 Section 94(6) of the Act provides:

If a consent authority proposes to impose a condition in accordance with subsection (1) or (3) in respect of development, the consent authority must take into consideration any land, money or other material public benefit that the applicant has elsewhere dedicated or provided free of cost within the area (or any adjoining area) or previously paid to the consent authority, other than:

(a) a benefit provided as a condition of the grant of development consent under this Act, or

(b) a benefit excluded from consideration under section 93F (6).

47 Mr Jackson submits that the car park is the material public benefit anticipated in the Council's DCP and that the applicant has voluntarily offered it to the Council in return for the additional two storeys in height. From the evidence provided, particularly within the council's bundle, Exhibit 2 and the Statement of Environmental Effects (SEE) lodged with the application found at Tab 3, that contention has particular relevance to the case. That document makes several references to the proposal incorporating a public carpark that would be dedicated to the council and I particularly have regard to that contained at Folio 55 (p36 of the document). Reference to the carpark is made and states:

The proposed development seeks to maximise the development potential of the site at a cost of providing a generous public benefit in the form of 84 on-site public car parking spaces, dedicated to Council.

48 Further comments are made at Folio 63 (p44 of the SEE):

The public benefit that was previously accepted by Council when the Master Plan was approved in 2004 was the provision of 84 on-site car parking spaces to be dedicated to Council for use by the general public. Not affordable housing. The provision of public car parking was considered to be a public benefit for Council as there is still a large shortfall in public car parking within the town centre. This lack of supply has caused a 'creep' factor into surrounding residential streets, which is not a desirable planning outcome.

49 It is also a matter that was included as part of the final SEPP1 objection to the FSR controls. That objection, whilst addressing the additional floor space within the building, also referenced the additional building height permitted under the DCP due to the public benefit component. The following is an extract from that objection taken from Folios 160 and 161 of Exhibit 2:

The applicant had included as part of the design a public benefit in the form of two levels of basement public parking spaces being a total of 96 spaces which have been identified with in a stratum allotment which will be capable of transfer to Council upon completion of the development at no cost. In addition, the development has been designed to accommodate a pedestrian thoroughfare to connect to Drakes Lane along the southern boundary which will also be provided to council at no cost.

The additional residential storeys of the proposed development have been included in the design to offset the cost associated with the provision of the public benefit, and in proposing the additional storeys so to the gross floor area of the development has exceeded the maximum FSR.

50 Despite the parties' agreement, it is still appropriate for the Court to be satisfied that conditions A(2), (3) and (4) are validly imposed. Section 80A of the Act provides the power to impose conditions and relevant subsections are:

80A(1)A condition of development consent may be imposed if:

(a) it relates to any matter referred to in section 79C (1) of relevance to the development the subject of the consent, or

(f) it requires the carrying out of works (whether or not being works on land to which the application relates) relating to any matter referred to in section 79C (1) applicable to the development the subject of the consent, or

(g) it modifies details of the development the subject of the development application, or

(h) it is authorised to be imposed under section 80 (3) or (5), subsections (5)-(9) of this section or section 94, 94A, 94EF or 94F.

51 Section 79C of the Act lists the matters that are to be taken into consideration by a consent authority in determining a development application. Those relevant considerations are:

In determining a development application, a consent authority is to take into consideration such of the following matters as are of relevance to the development the subject of the development application:

(a) the provisions of:

(i) any environmental planning instrument, and

(iii) any development control plan, and

(b) the likely impacts of that development, including environmental impacts on both the natural and built environments, and social and economic impacts in the locality,

(e) the public interest.

52 Craig J in Cavassini Constructions Pty Ltd v Fairfield City Council [2010] NSWLEC 65 provides guidance where at [26] he says:

In my opinion full effect can be given both to the statutory provision and to the Newbury tests if subsection (1)(a) of s 80A is considered as if it read:

"A condition of development consent may be imposed if it fairly and reasonably relates to any matter referred to in s 79C(1) of relevance to the development the subject of the consent."

Thus, the condition under challenge must be shown to be both fair and reasonable as it relates to a matter identified in s 79C(1). It must also be shown to be "of relevance" to the development the subject of the consent.

53 Having regard to the evidence before me and the council's planning controls, particularly the DCP, I am satisfied that the conditions that require the construction and dedication of the carpark as a public carpark are matters that wholly relate to the provisions of the LEP and DCP and are in the public interest. They reflect an essential element of the development application and are therefore of relevance to the development the subject of the consent. They ensure the provision of the public benefit contemplated in the DCP. It is apparent that the applicant and the development will be benefited by the public amenity provided due to the additional two storeys allowed by the consent. For these reasons, I am satisfied that the conditions have been validly imposed in accordance with s 80A.

54 Similar consideration as to the reasonableness of the contributions required in condition C(11) is also required i.e. whether it is reasonable in the circumstances of the case.

55 The works and facilities to be provided utilising funds collected through conditions C(11) are local roads, public transport facilities, open space, recreation and community facilities and a plan preparation and administration charge. No contribution for local carparking facilities was sought and this is a correct application of the s 94 Plan as all parking needs for the development is provided on the site.

56 In accordance with Mr Mackay's evidence, the terms of the s 94 Plan and the information provided within the SEE submitted with the development application, the carpark to be funded by contributions collected under that plan is not to address the current parking shortfall, it is to provide for the parking where non-residential development within the Town Centre is unable to provide car parking on site. I do not accept the evidence of Mr Fletcher that the provision of the carpark within the development is a "works-on-kind". That is because it is not a work contemplated by the plan and is to be provided to address an existing situation, not one that is the result of future development. Nor do I accept that its provision would delay or avoid the need to construct the local carpark contemplated under the s 94 Plan.

57 The carpark to be built applying the contributions collected would be required where development, the subject of future development applications to the council, does not provide for the parking needs of the non-residential floorspace within those developments. Whilst the work could be an 'in-kind' work as contemplated in clause 2.4.3 of the DCP as an 'equivalent work', I am not satisfied that this is the case. There will still be the need to provide the public benefit carpark the subject of these proceedings to address the current parking shortfall and the future carpark proposed in the s 94 Plan.

58 The history of the development application is important, and in particular, the offer of developer to provide a public benefit in the form of the public car park to gain an extra two levels within the two tower buildings as a bonus offered by the DCP. The Council and the JRPP have deemed the ultimate built form acceptable with a SEPP 1 objection upheld in relation to the FSR. Having concluded the development is appropriate, consent had been granted, including a condition requiring the dedication of the public car park.

59 Whether that car park provides for 84 or 99 spaces is not a matter that I consider is particularly relevant in the circumstances of the case. I accept the advice of Mr Jackson that the Council did not require any more than 84 spaces, and that it would be open for the applicant to apply to the Council to modify the development consent in a manner that would provide for the separation of the 84 spaces from the remainder of residential/commercial parking spaces. It is apparent from the evidence provided on behalf of the applicant and by the Council officer that an alternate design of basement level 2 and 3 would be required. This is not a matter in contention in the proceedings however, it does provide guidance to the parties.

60 What is important is that the dedication of the public benefit has always been a critical element of the development application. Having found that condition A(2) has been validly imposed under section 80A(1)(a) of the Act and it is clear that the developer has chosen to take the advantage of the additional two storeys contemplated in the DCP and elected to construct the public car park, I conclude that there is no relationship between the dedication of the carpark and the payment of the s 94 contributions. Both are necessary and both are reasonable.

61 Mr Ayling submitted that the provisions of s 94(6)(a) only apply to the retrospective provision of public benefits i.e. a developer would have, at some previous time, provided those benefits. On that basis, as the carpark has not been provided, he submits the provisions would exclude the Court from taking into consideration the public benefit proposed but not provided. Even if that is the case, I am satisfied that the two conditions are independent and that there is no reason to offset the costs associated with the construction and dedication of the public benefit carpark against the s 94 contributions. I find that the two matters are separate and discrete. Both conditions have been properly applied and are reasonable in the circumstances of the case.

62 It is not the case that the council is attempting to have the applicant provide a work that is identified in its s 94 Plan as a public benefit. The carpark that is to be dedicated to the council in accordance with the consent is not envisaged by that plan and will, according to Mr Mackay's evidence and the view of the applicant in the development application, provide a facility that could not be provided through the application of s 94. I agree. That is because it will be catering for an existing situation, not one that is the result of the demand of the proposed development.

63 Mr Ayling referred me to the decision of Dixon C in North Western Surveys Pty Limited v Penrith City Council [2012] NSWLEC 1017 and submitted that if the credit was allowed as proposed by the applicant, that would cover the costs of providing carparking in the Ashfield Town Centre and accordingly, it would be in the Court's discretion and would be reasonable to recognise the costs to the applicant in providing the public benefit and offset those costs against the s 94 contribution.

64 I distinguish the circumstances of this case to that in North Western as the works to be constructed and dedicated in this case are not works that are included in the council's contribution plan. That was not the case in North Western, those circumstances relating to the cap on contributions imposed by the State Government and the council attempting to deliver those works in an alternate manner i.e. as a condition imposed under s 80A. For the reasons provided above, the public carpark is not work contemplated in the s 94 Plan, nor is it "equivalent". I also note that case is the subject of legal review under the provisions of s 56A of the Land and Environment Court Act 1979.

65 The cost of construction of the public benefit is a matter that will ultimately be a decision for the applicant. Whilst the evidence in these proceedings suggests that it may not be the best financial outcome in terms of profit to proceed with the development as approved, that is a matter for the applicant. That carpark has always been an integral part of the application for which consent has been granted. I do not consider that it is severable from that consent. The approved development will also create a demand for additional public facilities and services and the cost of providing them should be met by the applicant.

66 In view of the above findings, it is appropriate that condition C(11) be modified and the amount of contribution reduced to reflect an allowance of the existing site development. The payment of the reduced amount and the provision of the public benefit in the form of the public carpark as proposed by the applicant are essential elements of the application and should not be waived. Accordingly, Condition C(11) should be retained with a reduced contribution.

Orders

67 The Orders of the Court are:

(1) The appeal is upheld in part.

(2) Condition C(11) of development consent10.2010.301.1 issued by Ashfield Council on 1 July 2011 authorising the demolition of an existing commercial building, tree removal and construction of 2 x 8 storey mixed use buildings with associated car parking at 2A Brown Street Ashfield is modified by reducing the total amount of s 94 contributions payable under that condition to $1,555,504.96 based on rates calculated as at 1 July 2011.

(3) The exhibits, other that exhibits C, 1 and 8 are returned.

Sue Morris

Commissioner of the Court

Decision last updated: 29 March 2012