The Department of Planning & Environment is currently exhibiting (until late January) proposed changes to the policy framework for VPAs. The amendments seek to ensure that VPAs are considered on merit as part of a broader planning assessment, and not based on the financial outcome achieved. The draft policy intends to improve the VPA process by ensuring:
- A fair, transparent and reasonable negotiation process.
- A clear public benefit that relates to the development.
- Infrastructure is informed by an assessment of local community needs.
The proposed framework strengthens the importance of VPAs as a mechanism to achieve increased public benefit. This policy evolution may create uncertainty as some developers may now feel compelled to offer a VPA, where previously this was not required.
However, what is clear is the positive direction that it is not appropriate for a planning authority to prioritise site specific planning proposals on the basis they provide for opportunity to capture windfall gain, over undertaking LGA wide strategic planning initiatives.
Equally encouraging is the emphasis on embracing the concept of ‘reasonableness’ in safeguarding the use of VPAs. This will bring into question existing Council VPA policies that have pre-determined a value capture calculation methodology.
What must also be introduced into the framework is embedding evidence based community needs assessment in strategic planning and VPA negotiation. This will foster transparency, clarity and certainty into the process, for the benefit of all parties.
Urbis has extensive experience in formulating VPA strategies and negotiating with councils on behalf of Australia’s leading developers. We regularly advise on the use of VPAs in connection with large-scale development in growth centres and urban renewal areas, and for site-specific developments in metropolitan and regional locations.
We will continue to encourage the improvement of the VPA policy framework through submissions to and discussions with Government and Industry and we will listen to our clients and colleagues in developing our responses.
Further information on the proposed amendments is available at the Department of Planning and Environment’s website.
If you would like to discuss the use of VPAs or the impacts of the proposed changes on VPA structure and negotiations, please contact one of our Sydney Urban Planning team.