Gerald Lanning Corina Faesenkloet July 25 2011 Quicker consent for nationally significant projects? Simpson Grierson | Environment & Climate Change - New Zealand Gerald Lanning, Corina Faesenkloet Environment & Climate Change IntroductionRationale for changeProcessAdvantages Roles of EPA and boards of inquiry Comparing New Zealand and New South WalesCommentIntroductionIn New Zealand, the consenting process for nationally significant projects has been significantly modified. Instead of having to apply to the relevant consent authority (ie, the body responsible for environmental planning and resource consenting within a defined geographic area), applications for such projects can be made directly to the newly created Environmental Protection Agency (EPA). The EPA was created during a process of statutory reform in 2009 to provide administrative support for the consenting of nationally significant projects. These reforms also empowered the minister for the environment to intervene in an application to a local authority by deeming a project to be nationally significant. Rationale for changeThe Resource Management Act 1991 is New Zealand's primary environmental legislation, governing the use of air, land and water resources. Provision for the EPA was made by the Resource Management (Simplifying and Streamlining) Amendment Act 2009, which amended the Resource Management Act 1991. The amendments were intended to address concerns that nationally significant projects were at risk of unnecessary delays because they had to proceed through lengthy hearings with local authorities, followed by appeals to the Environment Court.(1) A further appeal was then available to the High Court(2) on points of law. The government viewed this often time-consuming and costly process as too complex and inefficient, imposing unnecessary delays on nationally significant projects. Before the 2009 reforms, the process for dealing with nationally significant projects required that a project be called in by the minister.(3) A call-in resulted in the project being referred to a board of inquiry - that is, a panel of experts appointed by the minister to assess a particular project of national significance. The board of inquiry would hold a hearing and make a recommendation to the minister, who would then make the final decision on the application. The process was rarely used - only a handful of projects were referred to boards of inquiry. However, the 2009 amendments have given the board of inquiry process a new lease of life, broadening the scope of matters that can be referred and establishing the EPA as an administrative support structure. The 2009 amendments show that Parliament intends the process to be used more often. Process The starting point is the advancement of a proposal of national significance, with such status being determined by the minister. The act does not define the term 'national significance', but states that the minister may have regard to "any relevant factor", of which it lists several.(4) For example, a proposal may be regarded as nationally significant where it: has aroused widespread public concern or interest regarding its actual or likely effects on the environment (including the global environment); results in, or is likely to result in or contribute to, significant or irreversible changes to the environment (including the global environment); will assist the crown in fulfilling its public health, welfare, security or safety obligations or functions; or affects or is likely to affect more then one region or district. If a proposal is lodged directly with the EPA, the EPA will make a recommendation to the minister as to the proposal's national significance.(5) The minister will then decide on the project's status.(6) On deeming a project to be nationally significant, the minister may refer it to a board of inquiry. The EPA then publicly notifies the referral and calls for submissions.(7) Any person (including the minister) may make a submission in relation to the project. However, the Resource Management Act contains restrictions that prevent trade competitors from using the submissions process to obstruct other market participants.(8) Parties that make submissions must indicate whether they wish to appear before the board at the hearing. The minister selects the members of the board (after taking advice from the relevant local authorities). The chairperson must be a current, former or retired Environment Court judge or a retired High Court judge. The board must have between three and five members.(9) Selection is on the basis of knowledge, skill and experience relating to: the Resource Management Act; the matter or type of matter to be considered; Maori concerns, interests and protocols (referred to in the act as tikanga Māori); and the local community that is affected by the proposal.(10) In practice, boards are not exclusively composed of members of the legal profession. As well as suitably experienced lawyers and commissioners of the Environment Court,(11) planners, engineers, resource management consultants and former members and officers of local government have all been members of boards of inquiry. Advantages The process is potentially faster than the usual consenting process under the Resource Management Act. The board encompasses and replaces two elements from the traditional consenting process (ie, the consent authority hearing and the subsequent appeal to the Environment Court). The only right of appeal against the board's deision is to the High Court on points of law.(12)Moreover, the board is required to issue its decision within nine months of the EPA's public notification of the referral.(13) Such a strict timeline does not exist under the usual consenting process. The nine-month period makes no allowance for statutory holidays, so a proposal notified after April will include the traditional December and January summer holiday period in its timeframe. The act provides for the minister to grant an extension of time, but only in special circumstances. If extensions are granted, the act imposes a cap of 18 months in total, unless the applicant agrees to a longer period.(14) Roles of EPA and boards of inquiry The EPA provides administrative support to the board, acting like a registrar in a court hearing. The board is required to keep full records of the hearing, a task undertaken by EPA staff. The EPA also has the power to commission independent reports on the project and to require further information from the applicant.(15) In practice, the EPA exercises these powers at the request of the board. Although the commissioning of independent evidence is a departure from the usual adversarial procedure found in most of the New Zealand court system, it is not alien to the Environment Court, which applies a more inquisitorial approach to proceedings.(16)The board has a degree of autonomy in its conduct of a hearing. It is independent of the EPA and the minister, and is not influenced by either when making its decision. It has discretion to allow questions to be put to a party or witness and to allow cross-examination. Some of the basic courtroom formalities are observed, but overall the process may be less formal than an Environment Court hearing.So far, only two proposals of national significance have been examined by a board of inquiry under the new regime and resulted in final decisions being issued .(17) Both projects were approved generally in accordance with the application, despite various conditions being imposed. Another two proposals are being processed or heard by boards under the new regime. These relate to large-scale infrastructure construction projects for a motorway north of Wellington and a prison in South Auckland. Comparing New Zealand and New South WalesIn the Australian state of New South Wales, a different approach has been adopted. More discretion is given to the relevant minister (in this instance, the minister of planning). The minister assesses major projects with assistance - at his or her request - from the Planning Assessment Commission. He or she confers 'major project' status if the project falls into one of the categories identified in the State Environmental Planning Policy (Major Developments). These sector-specific categories set thresholds relating to the project's projected capital expenditure, the geographic location and the estimated number of operational employees. These criteria are more prescriptive than the 'national significance' criteria used in New Zealand. Once a proposal has been identified as a major project, the minister decides whether to grant consent and on what conditions. On request, the commission will provide expert advice, review the application and conduct public hearings, but the ultimate decision lies with the minister. The commission differs from a board of inquiry in being a permanent body - it is not specially appointed for each new project. Moreover, its involvement in major projects is at the discretion of the minister. The New South Wales system has resulted in rapid approval times for major projects (by New Zealand standards). In the 12 months up to June 30 2009, 441 major projects were approved. The median assessment time for these projects was 14 weeks.(18) Comment The new board of inquiry regime for projects of national significance is still settling in, but it appears that the consenting of nationally significant projects can now proceed in a much shorter time, without the so-called 'double-handling' aspect of the consent authorities and the Environment Court process. However, the number of projects being referred to boards of inquiry has the potential to put pressure on Environment Court judges and the court's ability to hear other proceedings under the act.For further information on this topic please contact Gerald Lanning, Corina Faesenkloet or Asher Fagan at Simpson Grierson by telephone (+64 9 358 2222), fax (+64 9 307 0331) or email ([email protected], [email protected] or [email protected]).Endnotes(1) New Zealand's specialist court dealing with consenting, planning and other environmental matters, holding a position in the court hierarchy parallel to the district court.(2) New Zealand's initial superior court.(3) Usually the minister for the environment, unless the project related solely to New Zealand's coastal marine area, in which case the minister of conservation was responsible.(4) Section 142(3).(5) Section 146(1).(6) Section 147.(7) Sections 149C and 149E.(8) See Section 149E(5).(9) Section 149J.(10) Section 149K(4).(11) Commissioners are experts appointed under the act. They assist the Environment Court by conducting mediations, providing expert knowledge to Environment Court judges and, in some circumstances, conducting hearings.(12) Section 149V.(13) Section 149R(2).(14) Sections 149R and S.(15) Section 149.(16) Section 276(1)(c).(17) Tauhara II geothermal development (application by Contact Energy Ltd) and Waterview Connection (application by the New Zealand Transport Agency). See www.epa.govt.nz.(18) New South Wales Department of Planning's annual report 2008-2009.