Land and Environment Court of New South Wales CITATION : Cowra Shire Council v The Minister for Urban Affairs and Planning & Anor [No.2] [2001] NSWLEC 113 APPLICANT: Cowra Shire Council FIRST RESPONDENT: PARTIES : The Minister for Urban Affairs & Planning SECOND RESPONDENT: Australian Silicon Pty Limited ACN 091 097 675 FILE NUMBER(S) : 11142 of 2000 CORAM: Lloyd J KEY ISSUES: Development Consent :- conditions - monetary contributions - calculation of reasonable amount Environmental Planning and Assessment Act 1979 s 76A(9), LEGISLATION CITED: s 94, s 94A, s 98 Land and Environment Court Act 1979 s 39(2) and (3) Allsands Pty Ltd v Shoalhaven City Council (1993) 78 LGERA 94; Cowra Shire Council v The Minister for Urban Affairs and Planning & Anor [2001] NSWLEC 63; CASES CITED: Daniel Callaghan Pty Ltd v Leichhardt Municipal Council (1981) 46 LGRA 29; Janlz Construction Pty Ltd v Randwick Municipal Council (1976) 2 NSWLR 427; Soft v Wollondilly Shire Council (1975) 2 NSWLR 614; Toadolla Co Pty Ltd v Dumaresq Shire Council 78 LGERA 261 DATES OF HEARING: 03/04/2001 and 04/04/2001 DATE OF JUDGMENT: 06/04/2001 APPLICANT: Mr C J Leggat (Barrister) SOLICITORS: Pike Pike & Fenwick FIRST RESPONDENT: LEGAL REPRESENTATIVES: Mr P R Clay (Barrister) SOLICITORS: Christine Hanson SECOND RESPONDENT: N/A JUDGMENT: 1 IN THE LAND AND Matter No: 11142 of 2000 ENVIRONMENT COURT Coram: Lloyd J OF NEW SOUTH WALES Decision date: 4 June 2001 Cowra Shire Council Applicant v The Minister for Urban Affairs and Planning First Respondent Australian Silicon Pty Limited ACN 091 097 675 Second Respondent REASONS FOR JUDGMENT [No. 2] Introduction 1. This is an unusual case. It is an appeal under s 98(1) of the Environmental Planning and Assessment Act 1979 ("The EP&A Act") against the determination of the amount of the monetary contribution imposed as a condition of a development consent on the ground that the amount is too low. 2. The nature of the appeal must be stressed. Although called an appeal, the Court is exercising an original jurisdiction and is itself determining whether the disputed condition should be imposed and if so in what sum, rather than determining whether the decision of the first respondent was correct. The Court is not bound by what the first respondent may have decided, nor is it bound by what the appellant contends should be the outcome, although they are matters to be taken into consideration (EP&A Act, s 39(2)-(5); Sofi v Wollondilly Shire Council (1975) 2 NSWLR 614; Janlz Constructions Pty Ltd v Randwick Municipal Council (1976) 2 NSWLR 427; Leichhardt Municipal Council v Daniel Callaghan Pty Ltd (1981) 46 LGRA 29 at 33). 3. The first respondent, the Minister for Urban Affairs and Planning ("the Minister"), granted consent to a development application made by the second respondent, Australian Silicon Pty Ltd, for the construction and operation of a quartz mine. The development is designated development, which circumstance gives the applicant, Cowra Shire Council ("the Council"), a right of appeal. 4. The subject development, known as Glenella Quartz Mine, is to be located on properties called "Glenella" and "Badgery", approximately 18 kilometres to the south east of the town of Cowra. It will replace a small scale mine which currently operates on the site producing pebbles for landscaping and water filtration purposes and construction sands. 5. The proposal is an integral part of the Lithgow Silicon Project, the principal element of which is the construction of a silicon plant at Wallerawang near Lithgow. The object of the proposed mine is to provide high purity quartz pebbles which are one of the major raw materials of the plant. The project is said to involve the investment of a total sum in excess of $100 million and it is projected that it will create employment for over 160 people overall. 6. On account of its relationship to the Lithgow Silicon Project as a whole, the subject development was declared State significant development by the Minister on 21 May 1999. The effect of this declaration was that, by force of s 76A(9) of the EP&A Act, the Minister became the consent authority for the application, instead of the Council. 7. There was some negotiation between the Minister, the developer, and the Council as to an appropriate contribution under s94 of the EP&A Act if the development were approved. On 24 August 2000 the Council wrote to the Department of Urban Affairs and Planning seeking a contribution of $400,000 from the developer, comprising a contribution of $250,000 to community facilities and a contribution of $150,000 to bushfire services. The Department, however, produced draft conditions of consent proposing a total contribution of only $100,000. The Council objected to this in a letter of 11 October 2000. Mr G Noonan, an officer of the Department in a minute dated 30 October 2000 justified this figure on the basis that, according to the Department's assessment, putting the Council's case at its highest, it could not be entitled to more than $132,500; therefore, the developer's compromise offer of $100,000 should be accepted. 8. Accordingly, when the Minister approved the development on 2 November 2000 it was subject to a condition (Condition 61 of the Consent) imposed under s 94 of the EP&A Act that the developer pay a $100,000 contribution "for the provision, augmentation and/ or embellishment of bushfire services and/or community services". 9. The Council claims that the s 94 contribution imposed was not calculated properly in accordance with the following contribution plans formulated by the Council, being Contribution Plan No. 9: Bushfire Rural/Villages and Contribution Plan No. 10: Community Facilities, and that if the contribution had been properly calculated it would have been higher. The Minister's Powers and Relationship to the Contributions Plan 10. I have previously held that the Minister has the power as consent authority to impose developer contributions under either or both s 94 and s 94A (see my judgement on the preliminary question of law: Cowra Shire Council v The Minister [2001] NSWLEC 63). 11. Section 94 of the EP&A Act provides, so far as is relevant: 94 Payment towards provision or improvement of amenities or services (1) Subject to subsection (2), if a consent authority is satisfied that a development, the subject of a development application or of an application for a complying development certificate, will or is likely to require the provision of or increase the demand for public amenities and public services within the area, the consent authority may grant consent to that application subject to a condition requiring: (a) the dedication of land free of cost, or (b) the payment of a monetary contribution, or both. (2) A condition referred to in subsection (1) is to be imposed only to require a reasonable dedication or contribution for the provision, extension or augmentation of the public amenities and public services mentioned in that subsection. (3) Subject to subsection (4), if: (a) a consent authority has, at any time, whether before or after the date of commencement of this Part, provided public amenities or public services within the area in preparation for or to facilitate the carrying out of development in the area, and (b) development, the subject of a development application or of an application for a complying development certificate, will, if carried out, benefit from the provision of those public amenities or public services, the consent authority may grant consent to the application subject to a condition requiring the payment of a monetary contribution towards recoupment of the cost of providing the public amenities or public services. (4) A condition referred to in subsection (3) is, subject to any direction of the Minister under section 94E (1), to be imposed only to require a reasonable contribution towards recoupment of the cost referred to in subsection (3). ... 13. Section 94A of the EP&A Act provides as follows: 94A Section 94 conditions imposed by the Minister or Director-General (1) The Minister or the Director-General, as the consent authority determining a development application, may impose conditions under this Division if the application relates to: (a) land within a growth centre, or (b) other land within a single area. (2) This Division, as modified by this section, applies to the Minister or the Director-General determining such a development application as consent authority. ... (4) Before imposing any condition under this Division, the Minister or the Director-General must have regard to any contributions plan approved under section 94B that applies to the whole or any part of the growth centre or area in which the relevant land is situated. (5) The Minister or the Director-General may impose a condition under this Division even though it is not of a kind allowed by, or is not in accordance with, a contributions plan. 14. Having regard to the nature of the appeal, noted in par [2] above, the Court occupies the position of the decision-maker who imposed condition, enjoys all of his or its powers and discretions for the purpose of determining the appeal and may inform itself using fresh evidence to arrive at a different decision from that arrived at by the primary decision-maker (s 39(2) and (3) of the Land and Environment Court Act 1979 ("the Court Act")). Therefore, the relevant question is not, as stated in the applicant's statement of issues, whether the Minister had proper regard to or properly applied the Council's contributions plans, but whether the Court, standing in the place of the Minister, having regard to the scope of his power to impose the condition and to the other matters specified in the EP&A Act, will arrive at the same or some other conclusion. 15. It is to be noted that the essential prerequisites for exercise of the power are that the consent authority must be satisfied that the development will require the provision of or increase the demand for public amenities and public services; that a contribution may be required only for the purpose of providing or extending those facilities or services; and that the contribution be reasonable. The consent authority being the Minister (in this appeal, the Court) is obliged to have regard to any contributions plan formulated by the local authority. Moreover, it is clear from subs 94(1) that there must be a nexus between the development and the increase in demand for the particular public amenities or public services, although the nexus need not be direct or immediate. This kind of connection or nexus is described in Toadolla Co Pty Ltd v Dumaresq Shire Council (1992) 78 LGERA 261 at 265: Section 94 Does not require a direct connection between the development and the public amenity upon which the contribution is to be spent, nor does it require geographical proximity: See Parramatta City Council v Peterson [61 LGRA 286] at 296)... It does, however, require that the condition must "fairly and reasonably relate to the subject development". Community Facilities 16. The Contributions Plan to which I am obliged to have regard is Contribution Plan No. 10: Community Facilities adopted by the Council on 10 May 1999, which lists (in Schedule No. 1) the total works for which contributions are sought at an estimated total cost of $2,345,000. 17. In its submissions to the Minister the Council sought a contribution towards additional items bringing the total amount in Schedule No. 1 to $5,145,000, but those items had not, at the date of the hearing, been validly incorporated into the Plan. The addition of the new works to Schedule No. 1 was adopted by the Council on 12 March 2001, subject to its being placed on public exhibition for 28 days as required by cl 30 of the Environmental Planning and Assessment Regulation 2000. At the commencement of this hearing on 3 April 2001 the Council had not fulfilled those statutory obligations vis a vis public participation which were necessary before it could effectively adopt the Plan. 18. Contribution Plan No. 10: Community Facilities provides that domestic development is to contribute to the provision of community facilities relative to its projected occupancy. Thus Contribution = E/CP x PP (rounded to the nearest dollar) Where E=> total cost of the embellishment works identified in Schedule No 1 ($ 2,345,000) PP=> projected population increase (ie Number of lots or units multiplied by the appropriate occupancy rate of); CP=> current population likely to benefit from the works (present Shire population 12,200 (1996 census data)) 19. The Plan goes on to compare domestic with industrial development: The affect [sic] of industrial and commercial development is no less significant than the affects [sic] accepted as imposed by residential developments. It is therefore equitable that all new industrial/commercial developments inclusive of major alterations, additions and ancillary works… be subjected to the application of this policy. An amount equivalent to that adopted as appropriate for a subdivision Lot in this contribution plan is considered appropriate as a minimum figure. Alternatively major industrial/commercial developments are likely to have significant effects on existing infrastructure and Council will assess the warrant for either a flat rate contribution based on the development cost of the proposed development (at 0.25% of the proposed development or the above mentioned minimum, which ever is the greater) or an individual merit assessment appropriate to the scale of the proposal. 20. However, the actual contribution levels adopted by the Council on 10 May 1999, (appearing in a table on p 6 of the Plan) represent a substantial discount compared with the figures derived from the formula: Contributions levels adopted by Council 10/5/99 a. Bedsitter or Bachelor Flat 1 person $63.00 b. Single Bedroom Unit 1.1 persons $69.00 c. Two Bedroom Unit 2.2 persons $134.00 d. Three Bedroom Unit 3.3 Persons $208.00 e. Dwelling House 4 persons $250.00 f. Subdivision Lot 4 persons $250.00 g. Commercial/Industrial Development 0.25% of total development value or $250.00 (4 person equivalent) whichever is greater, OR merit assessment determination 21 Whereas the formula method would give a contribution of $192 per person, the Council has fixed the contribution at $63 per person. This discount has also been applied to commercial and industrial development insofar as the minimum is referable to the amount payable for a subdivision lot (presumed to lead to a population increase of four people), but not to the alternative method of calculation which remains 0.25 per cent of total development value. The purpose of this discount, according to the Environmental Planning Committee's Report to the Council Meeting to be held on Monday 12th March 2001 was to "promote and maintain development within the shire". 22. The Council has provided little evidence in this case which truly addresses the question of whether the development will generate a need for new community facilities or place an increased demand upon existing community facilities. Mr W D McDonald, the Council's consultant town planner, concedes in his statement of evidence that, compared with the bushfire hazards assessment, "the effect on the general populus of Cowra is more difficult to gauge when assessing a reasonable contribution level towards community facilities." In calculating what it believed to be the appropriate contribution amount, he states that the Council decided to use the individual merits approach, in preference to the formulae available under the plan. He states: Council in deliberating on the proposal relative to its potential impact in the locality with respect to Community Facilities reviewed the context, setting, nature, scale and longevity of the proposal against perceived effect on the Cowra community as a whole and although the project as described in the EIS [environmental impact statement] exhibits limited socio-economic benefit to the local community as opposed to the Regional and State level the impacts of the development locally would be experienced by the broader community of Cowra by disruption to current and future amenity. 23. It seems that Council believed that the scale of the proposal warranted contributions being made to items not normally included in the contributions plan. According to Mr McDonald's statement of evidence: In so doing Council had regard to the Contributions Plan No. 10 and schedule 1 thereto, and based on the nature scale and longevity of the proposal resolved to expand the schedule to the plan to incorporate additional items, which conceivably should be included, relative to the scale of the unanticipated one-off nature of the proposal. The recommendation, having regard to the normal rural development experienced, resulted in the total value of assets for which contributions should be sought being increased from $2,345,000 to $5,145,000 incorporating additional works items of:- Cowra Civic Centre $1,500,000 Cowra Airport $700,000 Car parking (Library/Civic Centre/public) $600,000 24. It is then said that in an effort to "calculate a fair and equitable contribution level for the proposed development", the Council compared the proposal with other significant developments in the area where contributions toward community infrastructure had been "negotiated outside the development application process". This information, together with a consideration of the socio-economic impacts, expected disruption and loss of amenity and "community expectations" was said to lead to the Council's resolution that the proponent should be made to pay five per cent of the total works referred to in the contributions plan, represented by a payment of $250,000, which the Council believed to be "reasonable in the circumstances (as it) equated to a contribution of $6,250 per annum for the anticipated 40 year mine life or 3 cents per tonne annum production, are (sic) very small sum in the context of the overall development given its impact on the community". 25. When asked in cross-examination how the development would increase demand for particular amenities or public services identified in his statement of evidence, Mr McDonald said that because the joint venture partners were not local they would need to fly into the area, making use of the airport; that the developer might need to make use of council venues (civic centre and library) and library resources for training purposes, and that the development may result in more people using the swimming pool and car parking facilities in the town. In this respect he argued that one needed to take into account not only the number of people initially proposed to be employed on site, identified in the environmental impact statement as fourteen, but also the ten truck drivers required to haul the product to the railway siding and the anticipated increase in the number of employees after fifteen years of operations. 26. The report prepared by Mr D H Brindle, the consultant town planner for the Minister, directs itself to the question of the actual demand likely to be generated by the new development. Mr Brindle begins by considering the increased population likely to be brought into the shire by the development. Based on the environmental impact statement, he points out that fourteen people are likely to be employed on the site and ten in trucking services, but that this will not necessarily lead to a commensurate population increase, because some of these positions will be taken by present residents of the shire. He recognises the possibility that some additional visitors may also be brought into the shire who have business with the mine. He then directs attention to the works for which the contributions are said to be required and their relationship to the mine as follows: 1. Visitors Centre Toilet Block & Embellishment $100,000 2. Portable Stage $45,000 3. Grandstand Improvement W.C.R.G $100,000 4. Women's Rest Centre Improvement $100,000 5. Library Building / Facilities Embellishment $500,000 6. Swimming Pool Facilities Embellishment $1,500,000 Total $2,345,000 The additional demand for the visitors centre is expected to be minimal. There would be no additional demand by workers and little additional demand from visitors to the mine all of whom will be business associated. The additional demand would be minimal particularly when compared to other developments in the area such as the Japanese Garden, the POW camp, the wine and olive grove developments and other tourist attractions in the area. The portable stage, grandstand improvements and swimming pool might be facilities used by workers who do not already live in the Shire although their use would be minimal. The demand for these improvements would be more directly related to residential development. Workers at the site who do not already live in or work in the Shire might use the swimming pool on their way to or from work. This use would be minimal however. Workers would be more likely to use facilities near their residence than near their workplace. Similarly with library services. Use of the library at Cowra by workers would be controlled by operating policies at the library in relation to non residents. As with the other facilities, it is considered that the community facilities included in the schedule are too remote from the site for regular lunch time use and thus use would be limited to the journey to or from work by those workers that do not already live and or work in the Shire. It is considered that additional workers at the site who do not already live or work in the Shire would not increase the use of community facilities services to the same extent as a new resident to the Shire. This is because the likelihood that community facilities of the type included in the CP10 would be used more in association with the place of residents (sic) than in association with the place of employment, particularly when the place of employment is removed from the facilities limiting their use during lunch breaks…. 27. Taking these factors into account, Mr Brindle comes to the conclusion that to calculate the developer's contribution at the same rate as applies to residential development, that is at $63 per person employed on site, or a total of $882 would be more "reasonable" than to make a calculation based on the value of the development which, according to the formula in the Contribution Plan would lead to a total of $8,017. Mr Brindle evidently believes that the former calculation errs on the side of generosity given the "minimal" demands placed on local facilities by workers as compared to residents but prefers it to the latter calculation which he says is "more than (that) required to meet the reasonable needs generated by the development". 28. Mr Brindle's evidence is to be preferred to Mr McDonald's as a basis for arriving at an appropriate contribution because it directs itself to the relevant question posed by s 94(1) which is whether demand for the community facilities is generated by or increased by the subject development. 29. Mr McDonald's report focuses on the Council's method of arriving at the contribution sought and in doing so, shows that the Council's assessment was based almost entirely on irrelevant criteria. It reveals a rationale underlying the calculation based partly on principles of compensation (that the developer should make up to the shire its loss of amenity by an enhancement of facilities) and partly on principles of distributive justice (that the developer should make a contribution proportionate the size of the development). These principles have no place under s 94(1) which only directs the decision-maker to consider whether the development "will or is likely to require the provision of or increase the demand for public amenities and public services within the area". 30. It is not an issue in this case whether the Council (which was not the decision-maker) made its calculations on the basis of irrelevant criteria. What is significant about the foregoing is that Mr McDonald's report, in seeking to justify the imposition of a contribution on the basis of the same flawed reasoning, fails to address the relevant question of the nexus between the development and the increased demand for services, and is therefore not helpful. Some of the oral evidence which Mr McDonald gave in response to cross-examination is more relevant, but appears to be pure conjecture. Mr Brindle's assessment of the impact of industrial development relative to residential development is more thoroughly explained and reasoned and is therefore to be preferred. 31. Counsel for the Council, Mr C J Leggat, submitted that the amenity impacts referred to by Mr McDonald may be relevant to the s 94 contribution question, in that the amenity impacts of the development may be so great as to effect a change to the lifestyle of nearby residents which would lead them to place a greater demand on local community facilities and services; that is, that the increased demand may come not from additional people, but from the changed practices of people already in the Shire. 32. I do not believe that this kind of phenomenon, if it exists, can be dealt with under s 94, which is concerned only with demands which "fairly and reasonably relate to the proposed development" (Toadolla Co Pty Limited v Dumaresq Shire Council 78 LGERA 261 at 265). It is clearly the development itself which must generate the increased demand or the need for new facilities. The relationship need not necessarily be direct, as Mr Leggat correctly pointed out, but I believe that the relationship for which he now contends is too tenuous to be recognised under the section. In any case, one would want convincing evidence to show that people who are affected by noise or dust or increased traffic from the development are going to go to the library or go swimming more often as a result. There is no such evidence in this case. 33. Mr Brindle has acknowledged that there may be some use of the facilities specified in the Council's Contributions Plan by workers or visitors brought into the area by the development. Upon the basis of his evidence, I find that the development is likely to increase the demand for public amenities and public services, although the increased demand flowing from the development is not likely to be great. The imposition of a s 94 condition is therefore permissible and it falls to be determined what is a reasonable contribution in the circumstances. 34. Section 94(2) does not require a precise calculation between the demand generated and the contribution required. To do so would impose an unrealistic requirement on planning authorities and developers to predict the precise needs generated by each development, including very small developments. Instead it provides for the creation of contributions plans by councils, which identify the particular public amenities and public services upon which demand is placed, the cost thereof and which generally standardise the contributions applicable to certain categories of development. By providing for the formulation of contributions plans, it could be said that the EP&A Act prefers consistency and predictability to precision in this respect. A council may only impose contributions in accordance with a contributions plan. The Court, standing in the shoes of the Minister in this instance, must have regard to the Council's Contributions Plan, but is not bound by it. 35. To apply the minimum equivalent to a subdivision lot ($250) does not appear to be appropriate given the scale of the development, which is predicted to employ 14 persons. Neither is it appropriate to apply the formula method, calculated as a percentage of the capital cost of the development, since the capital cost in this instance clearly bears no relationship to the number of persons likely to be brought into the shire by the proposal, and it is people who use community services. 36. Sub-section (2) of s 94 provides that a condition may be imposed only to require a reasonable contribution. I find that the most reasonable approach would be to make a merits assessment as permitted by the Plan, and that assessment should proceed on the assumption that a development employing fourteen persons can have no greater impact on the provision of community facilities than a domestic development occupied by fourteen persons. Mr Brindle's evidence would tend to suggest that this method errs on the side of generosity given his opinion that industrial development has less of an impact on the provision of community services than domestic development; and the fact that many of the on-site employees may be drawn from the existing population of the shire. Mr Brindle has mentioned, however, that in addition to the on-site employees there may be some trade-related visitors passing through the town and using its facilities. As Mr McDonald pointed out, one also needs to take into account the fact that, in addition to the fourteen on-site workers, there will be some ten truck drivers passing through the shire in connection with the development. In view of these considerations, a calculation based on the fourteen-person estimate may not be at all excessive. 37. Mr Brindle uses the discounted per person calculation rather than the formula alone to arrive at a figure based on the number of persons on the site. This is appropriate. Whereas the function of the formula is to determine the relative proportion of the cost which each development proposal should bear, the discounted amounts represent the actual level at which Council has decided to levy contributions across the spectrum of development. I see no reason why this proposal should not, consistently with other proposals, benefit from the policy which Council has adopted in the Plan of discounting contributions in order not to stifle development. The contribution should therefore be calculated as follows: 14 persons x $63.00 = $882.00 38. Such an assessment has the advantage of being consistent with the criteria applied to other categories of development and is, in my opinion, the most reasonable which can be arrived at in light of the unique nature of the proposal and the difficulty of predicting its impact on community services, which would be marginal at most. Bushfire Services 39. The Council's Contribution Plan No. 9: Bushfire Rural/Villages has a schedule of works totalling $766,000. It describes a method of apportioning contributions between domestic and industrial/commercial developments as follows. I will set out both, as the relationship between them is relevant to the reasonableness of the quantum of contribution sought from the developer. Contribution Formula - Domestic Accepting that only infrequent opportunities exist for the provision of new and the augmentation of existing facilities, contributions will be sought for the provision and embellishment of new and existing facilities as detailed in Schedule 1 hereto. The formula for contribution toward Bushfire rural/villages is:- Contribution = E/CP x PP x 12.3% (rounded to the nearest dollar) Where E=> total cost of the embellishment works identified in Schedule No. 1 ($766,000); PP=> projected population increase (ie Number of lots or units multiplied by the appropriate occupancy rate of); CP=> current population likely to benefit from the works (present rural population 3483 (1991 census data)) 12.3% representing equivalent Council contribution. Contribution Formula - Industrial/Commercial The affect [sic] of industrial and commercial development is no less significant than the affects [sic] accepted as imposed by residential developments. It is therefore equitable that all new industrial/commercial developments inclusive of major alterations, additions and ancillary works (with the exception of home industry and home occupation), be subject to the application of this policy. An amount equivalent to that adopted as appropriate for a subdivision Lot in this contribution plan is considered appropriate as a minimum figure. Alternatively major industrial/commercial developments are likely to have significant effects on existing infrastructure and Council will assess the warrant for either a flat rate contribution based on the development cost of the proposed development (at 0.25% of the proposed development or the above-mentioned minimum, whichever is the greater) or an individual merit assessment appropriate to the scale of the proposal. Contributions determined applicable vide formulae described: a. Bedsitter or Bachelor Flat 1 person $27.00 b. Single Bedroom Unit 1.1 persons $30.00 c. Two Bedroom Unit 2.2 persons $60.00 d. Three Bedroom Unit 3.3 persons $90.00 e. Dwelling House 4 persons $108.00 f. Subdivision Lot 4 persons $108.00 g. Commercial Industrial Development 0.25% of total development value or $108 (4 person equivalent)whichever is greater; OR merit assessment determination 40. The second respondent (the mining company) has acknowledged that its operations will have some impact on bush fire management in the area. The council adduced evidence of a facsimile dated 16 August 2000 from Australian Silicon Pty Ltd to the Department of Urban Affairs and Planning, which states: We agree however that our operation could have some minor impact on bush fire management and are consequently prepared to contribute $100,000 for use by the local branch of the Bush Fire Brigade. 41. The offer of $100,000 should, however, be seen in the context of negotiations for approval of the project as the amount that the developer was then willing to pay to satisfy the Council's concerns; and not as an admission that such an amount was reasonable according to the terms of s 94. 42. The Council submits that the subject development will create a need which did not previously exist in the shire for additional firefighting facilities; and that this justifies a special merit assessment being made to determine an appropriate s 94 contribution for the development, rather than using any of the formula methods provided in the contributions plan. The need is said to include the provision of a category 1 fire tender in the vicinity and the upgrading of other fire services in the vicinity. 43. In support of its assertion that a category 1 tender is needed, the Council relies upon the evidence of Mr McDonald, its consultant town planner. According to his statement of evidence, the Council sought advice from the Cowra Fire Control Officer, and received the following reply: The Cowra Fire Control Officer responded verbally to Council's Planning Staff by indicating that the possible incidences of fire event would be increased by the type of equipment used by the proposal (ie steel track excavators on rock) and the storage and use of bulk fuels, chemicals and explosives on site. The present fire tanker in the locality is a 25year-old category 6 tanker with grassland fire capabilities only. It was suggested by the Fire Control Officer that the proposal warranted equipment with quicker response time and capacities/capabilities adequate for diverse fire situations. The Fire Control Officer indicated that in such circumstances the NSW Rural Fire Services recommend installation of a Category 1 tanker, estimated to cost approximately $174,000 exclusive of fit out. 44. Some aspects of the advice from the Fire Control Officer, Mr A Sharp, are reproduced in a memorandum from him to Mr McDonald dated 17 March 2001 in which the following list of risk factors appears: Factors that would increase the risk of fire or other incidents * · significant increase in heavy vehicle traffic across the Brigade areas * · operation of steel track earthmoving equipment on rocky terrain in mine area * · storage of flammable and hazardous substances within the mine area * · use of explosives on the mining lease * · use of welders, angle grinders and other hand tools in open country * · probability that the area will not be farmed or grazed promoting heavy coverage of vegetation becoming a fire hazard during the summer months 45. This appeal, being in being a Class 1 of the Court's jurisdiction, is not governed by the rules of evidence. Although I am thus not precluded from relying on the statements of Mr Sharp, I would normally be inclined to give them very little weight as they come in hearsay form from a person whose qualifications and experience are unknown, who has not given any evidence himself and was thus not cross-examined. I do not even know whether Mr Sharp has read the environmental impact statement for the development proposal, or based his opinions solely on information conveyed to him about the proposal from council's staff. This is a most unsatisfactory manner of presenting evidence on a subject which is clearly a subject for expert opinion and which is in issue in this appeal. 46. The respondent, however, although being aware of the Council's contention as to the need for a category 1 tender since long before the commencement of this litigation has not directly challenged the evidence of the need for a category 1 tender. The respondents did not call a bushfire management expert, did not seek to have Mr Sharp available for cross-examination and did not cross-examine Mr McDonald on this point. Both the environmental impact statement and Mr Brindle's statement of evidence assert that the impact of the proposal is neutral or positive in terms of bushfire risk, but do so without addressing the specific issues adverted to by Mr Sharp which are said to give rise to the need for a category 1 tender. The discussion of bushfire risks in the environmental impact statement addresses the inherent risks on the site, but does not address the need for bushfire services generated by the proposal as compared to the no-development scenario. Neither does the environmental impact statement consider off-site impacts such as the increased risk on haulage routes, including the transport of explosives, or the risks which might arise from the storage of fuels on site exceeding the capability of on-site firefighting equipment. 47. When Mr Brindle's attention was drawn, in cross-examination, to the risks adverted to by Mr Sharp, he said that he formed the view that "any fire fighting equipment required to meet the operational needs of the mine would be provided or should have been as a condition of the development consent". In this respect he appears to have been operating under an assumption that fire-fighting arrangements were adequate, since the consent authority was satisfied with them, rather than forming an independent view on the matter. When asked about the dangers arising from the storage of flammable and hazardous substances on the site he admitted to being unsure of the nature of hazardous substances to be stored on site and arrangements for storage. He did not say anything to negative the dangers arising from the use of explosives on site, or the transport of explosives or the use of hand tools. 48. I am prepared to accept, therefore, the Council's evidence of the need for a category 1 tender, since the evidence, such as it is, has not been specifically rebutted by the respondent's evidence. 49. There is at the present time at Niela a twenty-five-year-old non-categorised tender. As I understand the evidence, Niela is where the nearest tender to the development is based. The Council's contribution plan states the intention of replacing this with a category 2 tender, absent the subject development. The Council claims that as a result of the development, a category 1 tender is now required at that site. The Council is claiming the whole of the cost of a category 1 tender, although it seems to me from the evidence that the demand generated by the development should be represented in the difference in cost between a category 1 tender and a category 2 tender. 50. Mr Leggat asserted in submissions that both a category 2 tender and a category 1 tender were required because the category 1 tender would need to be available at all times to cope with fires at the mine, whereas the category 2 tender would be deployed to deal with other fires. There is no expert or other material in evidence, however, to support this submission. 51. Mr McDonald in his oral evidence initially asserted that the category 1 tender was required in addition to a category 2 tender at Niela; and the Council's claim certainly proceeds on this footing. Under cross-examination, however, he explained that if the category 1 tender were acquired for Niela, a category 2 tender would be "shuttled down the line to a nearby facility". My understanding of this evidence means that if the developer were required to pay the whole of the cost of a category 1 tender at Niela, the funding for the category 2 tender intended for Neila would be used elsewhere to fulfil needs not generated by the mine. There was some suggestion by Mr McDonald, in re-examination, that the location of a category 2 tender at another nearby station might be related to the development as it would probably be "on the transport route from the mine site"; however, this appears to have been added as an afterthought and I do not give much weight to it. On the whole of the evidence, a surplus category 2 tender would appear to represent a windfall to bushfire services in the area, rather than being representative of the demand created by the development compared with the no-development scenario. I therefore find as a fact that it is only reasonable to demand contributions from the developer which relate to the difference in cost between a category 2 tender and a category 1 tender. 52. In the memorandum of Mr Sharp, the fire control officer, to which I have referred, the current cost of a category 1 tender is said to be $174,475, plus $6,000 for fit-out, totalling $180,475. Mr Leggat compares this to a cost of $120,000 for a Category 2 tender as stated in Schedule 1 to Contribution Plan No.9: Bushfire Rural/Villages, giving a difference of $60,475. The validity of this comparison is dubious, since Schedule 1 represents figures which are clearly out of date. (This is apparent when it is seen that in the same schedule a category 1 tender is said to cost $148,000). The estimates of costs in the contribution plan may or may not be inclusive of fit-out. Nevertheless, since I have not been given any alternative figures upon which to base the comparison and since Mr P R Clay, appearing for the first respondent, appears content to proceed upon the basis that the difference in the costs is in the order of $60,475, I will assume that this is the relevant figure. 53. The Council also claims that the developer should be made to account for the following items of expenditure: · contribution towards enclosing the existing fire shed at Morongala $5,000 · contribution towards replacement and augmentation of equipment necessary for the new tender fit out and embellishment of nearby services that may in the event of fire be required to assist. $15,000 54. Mr McDonald, in his statement of evidence, states that the Council made an assessment of the requirement for reasonable contributions towards bushfire services "based on the nature, scale, extent, longevity, perceived impact and assessment of community expectation". The statement of evidence then continues: This assessment indicated that the impact of the development in the community regardless of on site mitigation measures was such that the existing bushfire services situated in the locality are inadequate to meet the immediate increase in scale of the operations and the potential risk and diversity of events that are likely, and would necessitate the provision of a Category 1 tender together with fire station upgrading at Morongala to cater adequately and would need to be provided as soon as possible upon commencement of operations. 55. Mr McDonald does not explain, however, as he does in relation to the category 1 tender, why the need for the fire station upgrading at Morongala is related to the development. This item is not referred to in the memorandum from Mr Sharp relating to the risks associated with the subject development. It is listed as an item in Schedule 1 of Contribution Plan No. 9: Bushfire Rural/Villages to which all development in the area over the life of the plan is asked to contribute. It does not appear reasonable to me that the developer should be responsible for the whole of the cost of this item, rather it should be considered as part of the total cost of fire services to which the developer might be asked to contribute if the development is likely to place increased demands upon such services generally. 56. The evidence shows that, of the additional $15,000 sought by the Council, noted in par [53] above, $6,000 is for the fit-out of the category 1 tender, which has already been taken into consideration. The remaining $9,000 must therefore represent what council considers to be a reasonable contribution for the "embellishment of nearby services that may in the event of fire be required to assist." 57. Apart from requiring the upgrade of the equipment at Niela, the Council has not shown how the development will place additional demands upon other bushfire services in the area so as to justify contributions in excess of those levied at the usual rates under the contributions plan. It has not called any evidence from bushfire experts to rebut assertions in the environmental impact statement (including the following) to the effect that the development will have a positive impact on bushfire management in the area generally: It is assessed that with the implementation of the above safeguards, no adverse effects on local bushfire management would occur. Rather, the increased availability of equipment for control of fires and the provision of an all-weather access to a substantial water storage and source of Lachlan River water, together with improved access through and within the "Glenella" and "Badgery" properties, would assist in the control of any fires which occur in the local area, independent of their source. 58. I therefore find as a fact that the development does not place additional demands upon local bushfire services apart from creating the need for a more advanced tender than would otherwise be required at Niela. 59. As noted in par [34] above, the Court, standing in the shoes of the Minister in this case, must have regard to Council's contribution plan (s 94A(4)) but may impose contributions which are not in accordance with this plan if it sees fit (s 94A(5)). 60. The provision of a category 1 tender at Niela is not an item listed in Schedule 1 to the plan, towards which the plan seeks contributions from development in the area generally. The need for a category 1 tender, I have found, has been created by the development, although once the tender is in place it will be available to fight fires in the area generally. I find therefore that it is reasonable that the proponent be made to pay the whole of the cost to council of that upgrading. 61. As to requiring an additional contribution under the Plan towards fire services in the area generally I find that, although the development may, equally with other development in the area, benefit from those services, it is not reasonable to require such a contribution. This is because (1) by contributing to the cost of category 1 tender which will be available for deployment throughout the area wherever it was needed ; and (2) by providing the additional facilities outlined in the environmental impact statement, the development will be providing a public benefit at least equal to the benefit which it enjoys from having access to existing fire-fighting services. 62. Although the EP&A Act is somewhat ambiguous in this respect, it has now been established by authority binding on this court that the costs of providing public amenities and public services to which developers might be asked to contribute under s 94 are costs to the council (Allsands Pty Ltd v Shoalhaven City Council (1993) 78 LGERA 435 at 446). Where part of the cost is met by other public or private bodies, the only relevant cost to be considered under this section is that which council itself pays, although this may only be a fraction of the cost of providing the amenities or services. As was stated in Allsands (by Priestley JA, with whom Mahoney and Meagher JJA agreed, at 446): Section 94 entitles the Council as the provider of the amenity or service to impose conditions requiring contributions towards the recoupment of the cost. In cases where, by arrangement with the government, the Council was never liable to anyone for payment of part of the cost of a work, the power to impose a condition requiring contribution towards recoupment of cost cannot be referable to a cost not incurred by Council. 63. As appears from the Rural Fires Act 1997, the provision of rural firefighting services is not principally a council responsibility. Necessary equipment is purchased by the New South Wales Rural Fire Fighting Fund, towards which Councils normally contribute 12.3%, as required by s 109 of that Act. The balance is made up of contributions from insurance companies and the State government. This state of affairs is confirmed by Mr McDonald, the Council's expert, who, when asked whether "the 12.3% (referred to in the Contributions Plan) was intended to reflect the amount which council actually ends up paying towards the provision of such facilities", replied in the affirmative. 64. The Council draws the court's attention to that fact that Contribution Plan No. 9: Bushfire Rural/Villages applies the 12.3% calculation to domestic and not to commercial/industrial development. This is true of the flat rate calculation, but not of the four person equivalent minimum, which is based on the same discounted rate as for domestic development. Mr McDonald asserted in oral evidence that this was so because the 12.3% figure bears little relationship to commercial/industrial development "on the basis that the scale of the development is likely to require the augmentation of the equipment immediately". Unfortunately he did not elaborate further, nor has the Council provided any evidence of how funding arrangements in respect of large-scale developments might differ from the usual arrangements under the Rural Fires Act 1997 and whether these would lead simply to an outlay which is later reimbursed, or to the Council making more than its usual total contribution to equipment. The difference would have to be quite dramatic to justify the method applied in the plan to the calculation of contributions from major industrial/commercial development, which is 0.25% of the total cost of the development. This is the same flat rate at which the community facilities contribution is imposed, although the total works scheduled under that plan is more than double those which are proposed under the Contribution Plan No. 9: Bushfire Rural/Villages, and the Council would normally be responsible for 100% of the cost under the former plan, whereas council is normally responsible for only 12.3% of the cost under the latter plan. On the face of it, the method appears to bear less relationship to the demands created by the development, than to the Council's speculation as to what developers will be able to afford. 65. The Court is obliged to have regard to the council's contribution plan, but this obligation does not relieve the Court of its overriding obligation to fix a contribution which is reasonable (s 94(2)). In the absence of evidence as to what alternative arrangements might be made it is reasonable to assume that the Council will only be required to pay 12.3% of the cost of the bushfire services which are necessary and to calculate the developer's contribution accordingly. It would not be reasonable, indeed it would be contrary to authority, to calculate the developer's contribution as if the council were to meet the whole cost. 66. Assuming that the cost of the upgrade to a category 1 tender is $60,475 and that the developer is to pay the whole of the cost to council of the upgrade, which is 12.3% of that figure, the resultant contribution is $7,438. Conclusion and orders 67. A reasonable monetary contribution towards community facilities is $882 and a reasonable contribution towards bushfire services is $7,438. This will be reflected in the amended condition 61 of the development consent. 68. I make the following orders: (1) Appeal allowed. (2) Condition 61 of the Development Consent dated 2 November 2000 is deleted and following condition is substituted: 61. Notwithstanding any other monetary contribution required under this consent, the Applicant shall contribute the sum of $8,320 to Cowra Shire Council in accordance with section 94 of the Act. Of the said sum, $882 is payable for the provision, augmentation and/or embellishment of community facilities; and $7,438 is payable for the provision, augmentation and/or embellishment of bushfire services. (3) The exhibits may be returned. DISCLAIMER - Every effort has been made to comply with suppression orders or statutory provisions prohibiting publication that may apply to this judgment or decision. The onus remains on any person using material in the judgment or decision to ensure that the intended use of that material does not breach any such order or provision. Further enquiries may be directed to the Registry of the Court or Tribunal in which it was generated.