Urban Renewal Authority to raise own taxes

[stumpjumper]

Under a Bill presently berfore Parliament, the Urban Renewal Authority, or even a private developer, can be given the power to act outside existing planning legislation and even to levy its own rates and taxes in area it requests the Minister to declared to be a development 'precinct'.

Under the new laws, the new 'local authority' to which people living in the Bowden/Brompton redevelopment would pay their rates would not Charles Sturt Council but a new statutory authority set up by Land Management Corporation. The only difference would be that no-one could vote for the new local authority. You would just hope they were ok.

The new local authority would develop and implement its own planning laws, granting approvals and exemptions and having the power to 'impose and recover rates, levies and charges (s 7K 1 c).

The Bill makes the Urban Renewal Authority (for whom the Bill appears to have been written) into local government and planning authority in one - the same Urban Renewal Authority which, as Land Management corporation, covered itself in glory in the redevelopment of Port Adelaide.

The Bill in question is the Housing and Development (Administrative Arrangements) (Urban Renewal) Amendment Bill 2013, now before Parliament.

I have no argument with urban renewal in general, but I am very concerned about giving an unelected body such as URA, or a private development company, the power to make planning law, enforce it and levy rates to do so, without so much sas a single vote being cast.

It is taxation without representation.

And why, with the vast assets and expertise of Planning SA and local government at its disposal to conduct development in a regulated and responsible manner, does the Government need to set up this incredibly powerful parallel administration, responsible only to the Minister, and certainly not to the people of South Australia?

I'd love to be enlightened.

[claybro]

Couple of things here Stumpjumper. Who appoints this authority? How is it set up, how many on the board etc. From what I can read from your post, it sounds almost like someone having to pay strata fees, for the upkeep of a unit complex, but on a broader scale, and it negates the need to pay council rates. For me, having at one point lived in the CCS, I have found their maintenance of local verges etc to be a bit wanting at times, and perhaps to have the development IE Bowden TOD micro managed by a very local authority, might make for better attention to detail, provided the local residents had some input as they do with strata meetings.

[stumpjumper]

For a start, here is the legislation:

http://www.legislation.sa.gov.au/LZ/B/C ... 02013.aspx

As far as I can see, it elevates the Urban Renewal Authority (URA) from being the product of subordinate legislation to being a statutory authority. This isn't just a technical point - it significantly increases the discretionary powers of the URA, ie the power it can wield before referring to any higher authority. These new powers appear to include planning powers (including powers over the design of roadways, design buildings including heights, density etc and infrastructure) as well a the power to levy rates.

7K 1
(a) to grant an approval, consent, licence or exemption; or
(b) to provide a service or infrastructure; or
(c) to impose and recover a rate, levy or charge

It also appears to confer the same powers on new 'statutory authorities' created under the proposed Act, which include private corporations.

The minister may set up a precinct under the management of a new statutory body in response to a request from a private developer.

I've done a bit of digging about this, and have discovered that the Bill basically tries to formalise the process that has taken place already in the development of the Bowden/Brompton 'precinct'.

The local council has been excluded there in order to speed the process. There will be a handover to the council at some stage, so it is not as if whatever body the Minister anoints to initiate the development will remain there as a rate-charging body, collecting the rubbish and sweeping the streets.

With that in mind, the Bill can be seen as a workaround of the sometimes delaying effects of the existing planning framework.

It sounds somewhat draconian and undemocratic, but it's probably not as disturbing as it appears. The aim is to provide good quality housing cheaply and quickly.

The day is approaching when greenfields developers will have to charge not only the infrastructure costs within their fringe developments (say, $20,000 per allotment) but a fair share of the macro-infrastructure costs (extended transport systems, schools, trunk roads etc).

Against these rising costs to the whole community, the fact that the land content for a dwelling in Bowden/Brompton can be as low as $50,000, including full infrastructure, can be seen as an excellent result.

Any planning regime which facilitates and promotes such a result must be a good thing.

claybro, in answer to your questions - the Minister appoints the authority. There is a board of 7 running the URA, comprised of architects, planners etc. An authority - not the URA, set up to undertake a precinct development could be expected to be of a similar size and makeup.

[claybro]

All sounds good to me...recoup some of the costs of development towards infrastructure (something seriously lacking at present) take care of the amenities of the specific precinct, and reduce the influence of the local council which in some cases, pander to vocal minorities pestering their windbag sessions at council meetings. Provided the same approach is taken to outer suburban developments, should promote some decent developments and then help maintain the environment in those developments.

[stumpjumper]

I think you're right, claybro.

The finished legislation should require time limits on how long the 'caretaker government' of the precinct authority should go on - although I can't imagine a developer or the URA wanting to pick up bins forever, and I don't think that the idea of making a profit on rates collected woukld ever be an aim, as higher rates are a disincentive to buy.

It is a pity, though, that the present system of planning legislation, Planning SA, local councils and the various DAPs, DAC and DPAC are seen as not being capable of delivering these inner urban redevelopment projects.

Rather than wear the cost of duplicating to some extent the planning administration we have with this 'rapid response' plan-construct-deliver arrangement, surely we could refashion in some way the present setup to deliver what's needed.

I note that the Bill specifically gives the URA the same powers as the South Australian Housing Trust which effectively did the same thing (autonomous precinct development) in a bygone era.

Things were very different then. SAHT's builders had all employees - there were no subbies. SAHT was also largely a 'greenfields' developer - Ascot Park, Hampstead Gardens, Mansfield Park and dozens more 'Housing Trust suburbs' were paddocks before the Housing Trust started building.

There are other precedents for what I'm calling rapid resonse, autonomous developers working outside the existing planning structure. Among these would be the post WWI State Bank '1000 Homes Scheme' which developed Colonel Light Gardens.

So for what it's worth I agree with the thinking behind the Bill. It's a pragmatic response to the need for more inner urban dwellings. But the structure is not without issues. For example, the heritage values of a place may be overlooked or eliminated, as I believe they were at the Port, to that precinct's ultimate loss.

The proposal places a lot of responsibility on the new authority to do the right thing by the community first, in cases when it may be in intimate contact with a third party developer. Again, in the management of the Port Adelaide redevelopment by LMC, the former name of the URA, a Stockholm Effect may have developed, with the LMC becoming more aligned with the goals of the developer than with the quality of the outcome for the community.

On that point, I'm not aware of any serious debriefing being carried out to find out what went wrong at the Port. I'd be interested to read such a report if there is one.

Let's hope the Bill achieves its aims. The implementation of the resulting Act should be watched closely.

[claybro]

On that point, I'm not aware of any serious debriefing being carried out to find out what went wrong at the Port. I'd be interested to read such a report if there is one.

Interesting you mention the Port here in this context. The Port "went wrong" under the current set up, so it is hard to imagine the new set up having a different or worse outcome. What has gone wrong with the Port is happening all over Adelaide, it was built to price and not quality, then sold at over inflated prices. Really the development of Newport Quays for all its faults vastly improved the Western bank of the Port River, but it lacks integration with the Ethelton railway station, and the council, whilst happy to site back and rake in the extra rates revenue, has done nothing to improve the appearance of Causway Road, nor has the relevant department really fixed up the station. Hopefully this new approach will stop developers trying to construct too many 1 bedroom dog boxes...and have them sit vacant while they try to sell them for $400k plus, and provide better integration into the surrounding community. If anything, going by current evidence it will be the lazy local councils that let the side down, not the development panel.

[monotonehell]

Stumpy, how does this compare to how Delfin (?) managed Golden Grove (and West Lakes?) before handing over to the local authority?

[stumpjumper]

Good points.

Delfin (basically Lend Lease) developed West Lakes at the request of the SA government in the 1970s. The land was undeveloped because it was a swamp and the hydro-engineering which included the tidally-flushed rowing lake (aka a collector drain) underpinned the usability of the whole site. The land was largely private, I believe, but was acquired by the government for the purpose of the development.

Delfin was also the developer for Golden Grove.

The legislative model for both developments was similar - an indenture requiring Delfin and the government to deliver certain things.

Both developments had a few hiccups, but both have been successful, in my view. Both were constructed over a long time period, and in certainly in the case of West Lakes the plan was flexible enough to adapt as the market changed. There were originally four service stations and several churches in the West Lakes proposal, for example. It could be said, however, that the West Lakes development has not been very 'kind', if that is the term, to its elderly neighbour, Port Adelaide. Apart from taking the Port's retail customers away, the WL development ignored the Port, aklthough integrating the Port into the WL plan woiuld be as difficult today as it was then.

Parts of both developments are a treat to drive through, and the sound capital gain on property prices in both developments indicates that it's pretty good living there too.

Where the two developments differ from Newport Quays and certainly from Bowden/Brompton and the future 'precinct' renewals the UZA Bill seems to expect is in the legislative and administrative structure.

In the GG and WL indentures and subsequent Acts, the state owned and controlled the land, with the developer more as an employee than a contractor. I say employee because although Delfin was a short term proxy for the local council, the company was directed by the government in many areas. For example, it had few staff of its own, and was directed to use government instrumentalities and their staff to undertake the design and much of the construction. Delfin was to use Planning SA, E & WS, ETSA etc. The developments were to comply with existing planning legislation, with the government building the major roads and infrastructure to the design requested of Planning SA etc by Delfin. I think that was more or less the arrangement.

From the GG Act 1984:

" 7A.1 The State shall, at no cost to the Joint Venturers, design construct and maintain or cause to be designed constructed and maintained all arterial roads..."

"7A.3 The Joint Venturers [Delfin] shall at their cost design and construct or cause to be designed and constructed all other collector roads and screening reserves..."

In my opinion, Delfin had the role of 'employed expert developer' and project manager. Apart from owning all the public spaces and roads, the government recieved, at GG at least, 45% of the sale price of all the land sold by Delfin (on the government' behalf - the government effectively paid Delfin a 55% commission to sell the government's share of a joint development - the new suburb created to Delfin's design). The government put up the land (with Delfin never having to actually purchase the land), and Delfin put up the money to pay not for the main infrastructure and trunk roads but the feeder roads and infrastructure connections to houses which it either paid for or 'sub-contracted to speculative builders or owners. Delfin was free in both developments to 'sublet' its responsibilities and engage smaller builders to develop properties under its wing. Complex, and I'm not a lawyer, but the arrangement seemed to achieve the good resaponse to market needs of the profit driven Delfin and its 'sub-builders', and the quality of main infrastructure - the bus interchange at GG, the main roads etc of the Highways Dept, E & WS etc.

You can find the legislation for WL and GG and the antecedent indenture agreemments on the web.

It's interesting to see the trajectory from even earlier than WL and GG - the Town of Elizabeth - to the current URA Bill. Elizabeth was wholly planned by a few government employees at the request of premier Tom Playford. He marked out the land north of the city, showed them where GMH was to go and requested a satellite city, please. The SAHT would build the houses and the government instrumentalities would build the rest. That was more or less it.

Even GG required maximum local input:

"15.1 As far as reasonably and commercially practicable the Joint Venturers during the currency of this Indenture shall:

(a) Use the services of engineers, surveyors, architects and other professional consultants resident and available within the State;

(b) Use labour available within the State;

(c) When calling for tenders and letting contracts for works, materials, plant, equipment and supplies ensure that South Australian suppliers, manufacturers and contractors are given reasonable opportunity to tender or quote; and

(d) Give proper consideration and where possible preference to South Australian suppliers, manufacturers and contractors when letting contracts or placing orders for works, materials, plant, equipment and supplies where price, quality, delivery, service and other commercial considerations are equal to or better than those obtainable elsewhere."

and even required protection for heritage:

" 11.1 The Joint Venturers shall ensure that all proper steps are taken to ensure that heritage items of identified State significance within the Development Area, namely, the principal buildings of the properties known as Surrey Farm, Ladywood Farm and Petworth Farm, are maintained and reserved for ultimate community use. "

The whole process was overseen by a board of management full of government representatives.

Now to the URA setup.

What is proposed is the design and management of the whole project by the URA and its contractors. URA is a statutory body with the powers of the SAHT, councils and planning authority in one. It does not have to conform to the Development Act or to any council Development Plan, on my reading.

As with the Port disaster/debacle or whatever it was, the requirement for consultation with the public is 'optional to weak' and is advisory only. Probably more importantly, there are likely to be stronger connections between the URA board and the private contractors than with the government, aka the community's representative.

This is a murky area, and it's not easy to be sure about these relationships or exactly where the power really resides from reading the Bill.It's not all gloom, though. Mawson Lakes works well enough, even though the place might feel about a size too small as you drive through it. Maybe I need a smaller car. The intentions are undoubtedly good, although as I've indicated it's hard to say whether priofit is the driving motive for the 'son of SAHT' the URA or whether the motive is community amenity.

I keep thinking of that beautiful. landscaped road that sweeps through 'Golden Groove' and the attractive ornamental lake (or sump) in the middle of Delfin Island at West Lakes, and wonder whether anything like that can be achieved by URA under its proposed Act. Then again, tight innewr urban sites are not really conducive to such things.

There are questions about the Bill, though. What guarantee is there of good design? How small a development can the arrangements cover? What about open space - I've heard that a lot of proposed open space at Bowden/Bromptin was eliminated 'due to the proximity of the Park Lands.' Yet there is a beautiful little sudivision at Ridleyton off Torrens Road that does a great deal with a little. Go for a drive, or better, a walk or bike ride, around Francis Ridley Circuit. You wouldn't know you were on literal infill, the levelled off Rowley Park Speedway, itself built in a disused pug hole. Narrow roads, small blocks, but a fantastic use of limited open space.

I've heard that URA hopes to get land content per dwelling down to $50,000 at Bowden/Brompton. Supposedly, that eventuality will stop people buying more expensive house and land packages in fringe developments and bring them back to the inner city so the taxpayer saves on infrastructure. But is price the only reason people are buying their 'detached house on own land'?

Who will benefit from the cheap land at BB? Will the savings be passed on to buyers, or used to increase the developer's profit? And who is the developer? Is URA a development corporation or a not-for-profit public instrumentality? It can't ask for vthe autonomy of a statutory body then use that autonom, freedom and power to pocket profits or start handing out contrracts to favoured 'associates'.

Private profit v community amenity. Quite a balancing act - how does the Bill help achieve that balance?

More digging and reading required, perhaps.