Environmental / Resource Management

Proposed NPS on Urban Development Capacity Released – 2 June 2016

Minister Nick Smith has announced the release of the Government's proposed National Policy Statement (Proposed NPS) on Urban Development Capacity for public consultation.  Relevant information, including a copy of the consultation document, may be viewed by accessing the Ministry for the Environment's website here.

The "Message from the Minister" promotes the Proposed NPS as a "new national direction" on urban development stating that it is required to make the RMA work better for housing and growth.  Further, while the Proposed NPS supports the amendments proposed to sections 30 and 31 of the RMA in the Resource Legislation Amendment Bill 2015 (which would create new functions for regional and territorial authorities to provide "development capacity" that is "sufficient" to meet demand – terms which the Proposed NPS defines), it could also be a stand alone document if required.  The Proposed NPS also defines what is intended by long (30 years), medium (10 years) and short (3 years) term.

Essentially, the purpose of the Proposed NPS is to ensure that planning enables development through providing sufficient development capacity for housing and businesses.  An overarching theme is that planning decisions actively enable growth and development in urban areas and accommodate that in a way that maximises wellbeing now and in the future.  If the Proposed NPS is made operative, the intention is that it will be supported by guidance and "likely training" for local authorities on how to implement it.

The five key themes of the Proposed NPS are described as:

  1. Enabling growth and development while managing the effects
  2. Meeting a range of demands
  3. Understanding and enabling the market
  4. Implications for infrastructure
  5. The roles and relationships between councils. 

The "Message from the Minister" states that the Proposed NPS also addresses three critical issues being the connection of planning decisions with economics, the requirement for more responsive planning and a rebalancing of national and local interests.  Among several related documents published together with the consultation document is a "summary of the proposed NPS-UDC" which groups the objectives and policies according to these issues.  We note in passing however that this document simplifies some of the wording in the Proposed NPS and consider that interested parties should ensure that they read the consultation document.

As we read the Proposed NPS, while certain policies only apply to regional councils, it essentially requires local authorities to concentrate resources on urban development capacity matters by doing the following:

  1. First working out which 'tier' it falls within – there are three.  The Proposed NPS is structured as having:
    • Tier 1 - Objectives and high-level policies which apply to all local authorities
    • Tier 2 - Policies which only apply to medium and high growth urban areas.  'Medium Growth Urban Areas' are defined as any Main Urban Area that is projected to experience population growth of between 5-10% over the medium term, or any Secondary Urban Area with a combined resident and visitor population of 30,000 or more which is projected to experience population growth of between 5-10% over the medium term.  Currently this definition includes the urban areas of Palmerston North, Wellington and Nelson.
    • Tier 3 - Further policies which apply only to high growth urban areas.  'High Growth Urban Areas' are defined as any Main Urban Area that is projected to experience population growth of more than 10% over the medium term, or any Secondary Urban Area with a combined resident and visitor population of 30,000 or more which is projected to experience population growth of more than 10% over the medium-term.  Currently this definition picks up the urban areas of Auckland, Tauranga, Hamilton, Christchurch and Queenstown.
    It is for note that these areas are not identified by councils, but by the Statistics New Zealand 'Classification of Urban Areas' and 'Projected Total Population by Urban Area' Tables in the Appendix to the Proposed NPS in conjunction with the definitions.
  2. If a local authority has part or all of a medium and/or high growth urban area within its jurisdiction, it must carry out housing and business land assessments (either by the end of 2018 or within 12 months of land becoming a part of a medium or high growth urban area, and thereafter on a 3-yearly basis).  These assessments must estimate the supply of development capacity to meet demand in the short, medium and long term and identify any insufficiencies.  There are also particular matters that calculations of sufficient development capacity should have regard to and indicators that must be monitored.
  3. Regional councils with part or all of a high growth urban area within their jurisdiction are required to set minimum targets for sufficient residential development capacity in accordance with their housing assessments, and to incorporate those targets into their regional policy statements without using the Schedule 1 RMA process.  Those targets must be set for the medium and long term and be reviewed every 3 years.  The targets must also take account of the likelihood that not all capacity will be developed and must require an additional margin of at least 20% over and above the projected short and medium-term demand and 15% over and above the projected long-term demand.
  4. Developing future land release and intensification strategies which work alongside plans and regional policy statements to ensure sufficient development capacity. Such strategies must be informed by the housing and business land assessments, the views of infrastructure providers, landowners, the property development sector and other stakeholders.
  5. Working more closely with infrastructure providers to agree data and coordinate planning and infrastructure provisions. 

Public submissions on the Proposed NPS close at 5pm, Friday 15 July 2016.  The Minister's media release states an intention that the policy take effect in October this year following consultation, and in conjunction with the changes to the RMA and Auckland's new Unitary Plan.

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