State significant and delayed rezoning proposals fast-tracked by NSW Government

The State Significant Rezoning Policy creates a streamlined rezoning pathway for eligible State and regional rezoning proposals, including delayed proposals, with initial target sites identified by the NSW Government.

Key takeaways

• The NSW Government released the State Significant Rezoning Policy (Policy) last month, which is expected to provide a faster State rezoning pathway for large and complex rezoning proposals to deliver more social and affordable housing in NSW.
• The Minister for Planning and Public Spaces will be able to initiate amendments to zoning controls for proposals that are of State or regional significance, or that have been unreasonably delayed by a local council.
• The pathway comprises two parts: State-led or State-assessed rezoning, which are estimated to take 562 working days and 345 working days from proposal evaluation to Ministerial recommendation, respectively.
• The Department of Planning, Housing and Infrastructure (DPHI) Evaluation Panel will assess and identify eligible sites and has already announced 11 target sites to be fast-tracked.

What is the Policy?

The Policy has been developed by DPHI in response to the need to deliver more social and affordable housing in NSW and seeks to complement the NSW Government’s Transport Orientated Development Program and other reforms to improve the planning system.

It sets out a streamlined State rezoning process for identifying and evaluating sites considered eligible under one of the following two pathways:

• State-led rezoning for large or precinct scale proposals that have strategic importance requiring preparation and management by DPHI; or
• State-assessed rezoning for State or regionally significant sites or proposals that have been unreasonably delayed that are prepared by an applicant (e.g. a local council, government agency or private landowner) and assessed by DPHI.

The Policy replaces the former Rezoning Pathways Program. Proposals subject to the State Assessed Planning Proposal Pilot (Industry Nomination) will continue to be assessed under that pathway.

How are eligible rezoning proposals identified?

The Policy establishes a framework to allow the Minister to initiate amendments to a Local Environmental Plan or other environmental planning instrument (EPI) via a State Environmental Planning Policy for matters that, in the opinion of the Minister:

• are of State or regional significance; or
• where a local council has failed to comply with or carry out its obligations with respect to the making of a proposed rezoning EPI (for example, if the benchmark timeframes outlined in the Local Environmental Plan Making Guideline (August 2023) have been breached).

The Evaluation Panel will identify sites eligible to be assessed under the Policy and make a recommendation to the Minister. DPHI may determine that a proposal is eligible if it satisfies the following minimum criteria:

• the proposal is of State or regional significance, or has been unreasonably delayed in the planning system; and
• the proposal is capable of addressing relevant planning legislation, strategic plan, polices and directions by the Minister.

In addition, DPHI will consider:

• how many assessment days will be saved through the State rezoning pathway;
• the scale of the proposal – DPHI will give preference to proposals that deliver (or may preference proposals that yield within 20% of the following thresholds):
  • 100 dwellings in Regional NSW or 500 dwellings in Metropolitan NSW;
  • 50 affordable housing dwellings;
  • dwellings in a Renewable Energy Zone; and
  • 50 jobs in Regional NSW or 100 jobs in Metropolitan NSW;
• how quickly a development application is able to be submitted and the project realised once rezoning is finalised – preference will be given to proposals that are able to have a development application submitted within 6 months of rezoning finalisation; and
• whether complexities (such as coordinating multiple State agency stakeholders) will be resolved by the State rezoning pathway.

How streamlined is the proposed rezoning pathway?

The Policy provides the following timeframes for each branch of the streamlined pathway:

• State-led rezoning: approximately 562 working days from pre-exhibition proposal evaluation (20 working days), application preparation (12 months / 252 working days) and exhibition (minimum of 20 working days) to post-exhibition amendments and recommendation to the Minister (270 working days).
• State-assessed rezoning: 320 – 345 working days from pre-lodgment proposal evaluation (20 working days) and proposal preparation (120 working days) to the making of EPI instruments (includes adequacy review, drafting, exhibition and post-exhibition amendments), finalisation and recommendation to the Minister (180 – 205 working days).

DPHI estimates that the State rezoning pathway has a potential saving of 200 working days, compared to an indicative timeframe of 420 working days for complex rezonings considered by local councils.

However, the Policy does not provide an expected timeframe for a determination to be made by the Minister once a recommendation is made by DPHI.

What happens next?

DPHI has already identified the following rezonings as eligible for the new pathway:

• Blackwattle Bay;
• Fitzwilliam St, Parramatta;
• Redmond Place, Orange;
• Central Place Sydney;
• Coffs Harbour Jetty Foreshore;
• Riverstone Town Centre;
• Marsden Park North;
• West Schofields;
• Parramatta Road Urban Transformation Strategy (Inner West Council);
• Kurnell Peninsula; and
• Tuggerah Gateway Site.

DPHI will now lead the assessment of rezoning proposals that may be eligible. This process may include consultation with key stakeholders.

The identification of additional sites to be fast-tracked is the sole responsibility of DPHI and the Policy states that DPHI’s decision regarding site eligibility is final and non-appealable. Any additional sites that are selected by DPHI will be subject to review by the Evaluation Panel in accordance with the Policy.

You can find out more about the Policy here.

If you would like to discuss how the Policy might impact any current or planned rezoning proposal(s), please contact us.

Written by Peter Briggs, Partner, Tom Dougherty, Senior Associate and Andrew Mahler, Solicitor