NZLII Home | Databases | WorldLII | Search | Feedback

New Zealand Journal of Environmental Law

You are here:  NZLII >> Databases >> New Zealand Journal of Environmental Law >> 2009 >> [2009] NZJlEnvLaw 7

Database Search | Name Search | Recent Articles | Noteup | LawCite | Download | Help

Munro, Ian --- "Sustainable development, urban form, and development contributions" [2009] NZJlEnvLaw 7; (2009) 13 NZJEL 189

Last Updated: 31 January 2023




Sustainable Development, Urban Form, and Development Contributions

Ian Munro*

The equitable provision of community facilities has been identified locally and internationally as an important component of sustainable development. Several strategic and regulatory plans have been predicated in New Zealand on the notion that activities in space do not have uniform effects. Instead, they can be configured and located to maximise certain qualities (such as economic activity), while minimising others (such as environmental pollution or demand for infrastructure services). The Local Government Act 2002 requires that local authorities take a sustainable development approach to promote well-being. Development contribution policies promulgated by territorial authorities under that Act can help fund the capital costs of community facilities required as a consequence of growth. It could be expected that those policies might be consistent with urban sustainability prerogatives through the attribution of community facility demand between developments or types of development. This article will evaluate six territorial authority development contribution policies to examine how they relate to sustainable development generally, and urban sustainability specifically. It will conclude that overall each of the policies fails to acknowledge or otherwise promote principles of urban sustainability. Further, they seem to contradict existing local policies calling for sustainable urban outcomes in the way they attribute infrastructure demand and establish market price signals between different types of development. This could call into question whether a sustainable development approach has been successfully taken.

*B Plan (Hons), M Plan (Hons), M Arch (Hons), MNZPI, Senior Associate/Urban Sustainability Specialist, Urbanismplus Ltd, Auckland City; Revision of a paper prepared for the MEnvLS at the Law School, The University of Auckland.



2009_703.pngNew Zealand Journal of Environmental Law


1.1 The Local Government Act Provides for Development Contributions

The Local Government Act 2002 (“LGA” or “the Act”) allows territorial authorities to require development contributions. These cash or land contrib- utions help fund the capital costs of community facilities through an exaction from those who generate demand for those facilities.

The tool is framed by the wider purpose of the LGA. The Act empowers all local authorities to promote the social, economic, environmental, and cultural well-being of their communities by using a sustainable development approach. Although primarily a funding tool, development contributions are therefore not necessarily restricted to simple revenue generation. There may be a wider role for the tool to play in promoting community well-being.

The contributions can only be required from new development. Most of this will be urban — relating to cities, townships, and suburbs. It is proposed that understanding the relationship between urban form, well-being, and sustainable development may help ensure the tool is most effectively applied towards achieving the purpose of the LGA.

1.2 Location and Context Affects Demand for Community Facilities

Many activities are influenced by their site or context, operating optimally where certain spatial characteristics or other amenities are available. Developments which take advantage of these opportunities will more directly promote well- being than outcomes which do not. This well-being could manifest as lower operating costs; fewer environmental externalities; less time lost travelling between destinations; or better market access as examples. It suggests that in different locations two identical activities may generate different levels of demand for various community facilities. The establishment of market prices which internalise these advantages (or disadvantages) may influence the development choices made by individuals within communities.

A use of the development contribution tool through a policy that failed to appropriately attribute those community facility demand dynamics could result in circumstances where individuals making more-sustainable development choices subsidised the community facilities required by those making less- sustainable choices. Such a policy could undermine efforts to improve the sustainability of settlements, or otherwise be inconsistent with taking a sustain- able development approach to promote well-being.



2009_706.pngForm, and Development Contributions 191

1.3 Structure of this Article

This article will introduce, in the second section, sustainable development and discuss how urban form is relevant. In section three the parameters of the development contribution tool will be outlined and in section four the urban sustainability issues related to network infrastructure (transport, water, wastewater, and stormwater systems) required by residential development will be examined. Through section five the residential provisions of development contribution policies prepared by six New Zealand territorial authorities will be examined with reference to any sustainable urban growth or development policies they may have also adopted. It will be submitted, in section six, that all of those policies — in the same fundamental ways — are inconsistent with principles of sustainable urban development and (where relevant) adopted urban development policies. More critically, based on the evidence relied on in reaching those conclusions, questions about the appropriateness of using a standardised household equivalent unit to satisfy the statutory requirements of Schedule 13 of the LGA are identified.


2.1 Sustainable Development is a Means to an End

Sustainable development is a concept relating to the long-term welfare and prosperity of humanity. The World Commission on Environment and Develop- ment (“WCED”) (1987)1 synthesised a political consensus in its proposition of a new way to meet the needs of the present without compromising future needs (Perkins and Thorns, 2000;2 and Grundy, 1993).3 It is based around advancing an integrated approach to reconcile multiple — sometimes opposing — interests within resource constraints and in a manner which gives effect to basic human dignity, rights, and freedoms.

The focus of sustainable development is the (intergenerational) meeting of human needs, including aspirations for a better life, in harmony with the

  1. World Commission on Environment and Development (“WCED”), Report of the World Commission on Environment and Development: Our Common Future (New York: United Nations, 1987) chapter 1, para 27, 25.
  2. H Perkins and S Thorns, “Urban Sustainability and City Planning”, in A Memon and H Perkins (eds), Environmental Planning and Management in New Zealand (Palmerston North: Dunmore Press, 2000) chapter 32, 350.
  3. K Grundy, Sustainable Development: A New Zealand Perspective (Dunedin: University of Otago, 1993) chapters 2 and 3, 11–32.



2009_707.pngNew Zealand Journal of Environmental Law

environment (WCED, 1987).4 It is proposed that this is equivalent to the concept of well-being. Sustainability dialogue is characterised by its attempt to enhance three distinct states of well-being: social, economic, and environmental (WCED, 1987;5 UNCED, 1992;6 HABITAT, 1994;7 European Commission,

1996;8 and UNCSD, 2005).9 A fourth interconnected well-being — cultural — is now additionally used in New Zealand (Department of Prime Minister and Cabinet, 2003),10 notwithstanding that the Parliamentary Commissioner for the Environment (2002)11 had previously suggested that such could be considered as a subset within social well-being.

This collective dialogue has emphasised sustainable development as a means to intergenerational environmental and human well-being as an end (Parliamentary Commissioner for the Environment, 2002;12 and UNCSD, 2005).13 This interpretation is suggested to sit well with ss 3 and 14 of the LGA where taking a sustainable development approach to pursue the four well-beings is set out. As noted by Harris (2004):14

The Act allows a more conscious intervention after appropriate consultation to promote ‘better’ communities in terms of the quadruple bottom line; that is, sustainable development in terms of environmental, economic, social and cultural issues.

  1. WCED, supra note 1, chapter 1, para 27, 24.
  2. Ibid, at chapter 1, paras 39–42, 48–49.
  3. United Nations Conference on Environment and Development, Report of the United Nations Conference on Environment and Development (Rio de Janeiro) (New York: United Nations, 1992) chapter 1, para 1.1.
  4. United Nations Centre for Human Settlements (HABITAT), Sustainable Human Settlements Development: Implementing Agenda 21 (New York: United Nations, 1994) 7.
  5. European Commission Expert Group on the Urban Environment, European Sustainable Cities (Brussels: European Commission, 1996) abstract.
  6. United Nations Commission on Sustainable Development, Thirteenth Session, Human Settlements: Policy Options and Possible Actions to Expedite Implementation (New York: United Nations, 2005) 8.
  7. Department of Prime Minister and Cabinet, Sustainable Development for New Zealand: Programme of Action (Wellington: Department of Prime Minister and Cabinet, 2003) 10.
  8. Office of the Parliamentary Commissioner for the Environment, Creating our Future: Sustainable Development for New Zealand (Wellington: Office of the Parliamentary Commissioner for the Environment, 2002) 36.
  9. Ibid, at 38.
  10. United Nations Commission on Sustainable Development, supra note 9, at 7.
  11. R Harris, “Local Government and Development Legislation”, in R Harris (ed), Handbook of Environmental Law (Wellington: Royal Forest and Bird Protection Society of New Zealand Incorporated, 2004) chapter 3G, 129.



2009_708.pngForm, and Development Contributions 193

2.2 Good Governance Essential

Themes around using development inputs better dominate sustainability literature. The role of informed, well-planned decision-making frameworks has been championed as a means of providing for this within the parameters of environmental capacity (WCED, 1987;15 and Newman & Kenworthy, 1999).16 The European Commission (1996) has been particularly clear about what this means for governance:17

Sustainable development will only happen if it is explicitly planned for. Market forces or other unconscious and undirected phenomena cannot solve the serious problems of sustainability.

One particular subset within this approach to governance relates to internally consistent policy-making within and between organisations (WSSD, 2002).18 UNCSD (2005) gives a succinct summary of:19

... a process by which ... policies are designed and are mutually supportive in such a way as to bring about development which is ... sustainable.

Therefore, adopting a policy that leads to outcomes which compete with or negate the intention of other policies would not be consistent with taking a sustainable development approach (European Commission, 1996).20 This immediately suggests that if a development contribution policy has an impact on development outcomes within a district, those outcomes should be mutually supportive with those sought by other policies which relate to development outcomes or settlement patterns.

  1. World Commission on Environment and Development, supra note 1, chapter 2, para 60, 30. 16 P Newman and J Kenworthy, Sustainability and Cities: Overcoming Automobile

Dependence (Washington: Island Press, 1999) 7.

  1. European Commission Expert Group on the Urban Environment, supra note 8, chapter 8, part 2, para 2.
  2. World Summit on Sustainable Development, Report of the World Summit on Sustainable Development (Johannesburg) (New York: United Nations, 2002) para 4, 8 & para 138, 64.
  3. United Nations Commission on Sustainable Development, supra note 9, at 7.
  4. European Commission Expert Group on the Urban Environment, supra note 8, abstract, para 2.



2009_709.pngNew Zealand Journal of Environmental Law

2.3 Urban Environment a Key Setting for Sustainable Development

The role of urban settlements in sustainable development was comprehensively advanced in UNCED (1992).21 This has since received further consideration by many including HABITAT (1994),22 and the European Commission (1996).23 Sustainable urban development, or urban sustainability, focuses around how activities are undertaken in space relative to interconnected considerations of resource use and externalities (Parliamentary Commissioner for the Environment, 1998).24

2.4 Issues Related to Urban Form and Community Facilities

A function of agricultural surplus-based civilisation has been economic specialisation. The development of wealthy societies over the past several thousand years has been connected to patterns of increasing specialisations and divisions of labour within them (Mumford, 1961;25 and Starr, 1991).26 Florida (2003)27 has explored in detail how this specialisation has reached the point where managing what he terms the “creative class” of highly specialised individuals in the state of open, mobile, and widespread interaction is becoming one of the most critical drivers of economic development and competitive advantage between urban areas.

It is proposed that one result of an increasingly specialised division of labour and services will be an increased interdependence between the individual members of a community in assuring their ongoing collective welfare. Typical New Zealand urban dwellers are now dependent on the actions of dozens if not hundreds of third parties (many living outside of the country) to live their total lifestyle. This includes the provision of at least some food grown elsewhere and transported to an intermediary marketplace; to the collection, processing, and disposal of wastes; and including all other activities in between. The inevitable

  1. United Nations Conference on Environment and Development, supra note 6, “Promoting Sustainable Urban Settlement Development”, chapter 7.
  2. United Nations Centre for Human Settlements (HABITAT), supra note 7, at 3.
  3. European Commission Expert Group on the Urban Environment, supra note 8, “Cities and Sustainability”, chapter 2, part 5.
  4. Office of the Parliamentary Commissioner for the Environment, The Cities and Their People: New Zealand’s Urban Environment (Wellington: Office of the Parliamentary Commissioner for the Environment, 1998) executive summary.
  5. L Mumford, The City in History: Its Origins, Its Transformations, and Its Prospects (New York: Harcourt Brace and World, 1961) chapters 1–4.
  6. C Starr, A History of the Ancient World, 4th ed (Oxford: Oxford University Press, 1991) 32. 27 R Florida, The Rise of the Creative Class (Melbourne: Pluto Press, 2003) 59.



2009_706.pngForm, and Development Contributions 195

consequence of this pattern of greater interpersonal and interspatial exchange will be an increased contribution played by physical networks (including community facilities) in people’s everyday lives. Managing the way in which those networks require people to expend effort, conserve energy, or create externalities as they pursue their aspirations is therefore suggested as being a critical part of any attempt to pursue sustainable urban development.

The way physical networks contribute to either enabling or disabling the aspirations of people within them has been widely considered (English Partnerships, 2001;28 Ministry for the Environment, 2002;29 and Carmona et al, 2003).30 Bentley et al (1985)31 very succinctly connect the fundamental relationship between the quality of what they describe as democracy in physical space with the democracy of a community (primarily enabled by participation, choice, and equity).

Building on these concepts, specific attention has been given to under- standing how the manipulation of space and available resources can lead to changes in the relative costs and benefits of “X” action in “Y” environment (CABE, 2001,32 and 2006;33 and Ministry for the Environment, 2005).34 Calthorpe (1993) presents a helpful illustration of how the organisation of urban space can support or suppress well-being:35

The old suburban dream is increasingly out of sync with today’s culture. Our household makeup has changed dramatically ... But we continue to build post- World War II suburbs as if families were large and had only one breadwinner, as if the jobs were all downtown, as if land and energy were endless, and as if another lane on the freeway would end traffic congestion. ... Over the last twenty years these patterns of growth have become more and more

28 English Partnerships, Urban Design Compendium (London: Llewelyn-Davies, 2000) 12–13. 29 Ministry for the Environment, People + Places + Spaces: A design guide for urban New

Zealand (Wellington: Ministry for the Environment, 2002) 32.

  1. M Carmona, T Heath, T Oc and S Tiesdell, Public Places, Urban Spaces: The Dimensions of Urban Design (Oxford: Architectural Press, 2003) 3–9.
  2. I Bentley, A Alcock, P Murrain, S McGlynn and G Smith, Responsive Environments

(Oxford: Butterworth Architecture, 1985) 9.

  1. Commission for Architecture and the Built Environment (“CABE”), The Value of Urban Design (London: CABE, 2001) 8.
  2. CABE, Buildings and Spaces: Why Design Matters (London: CABE, 2006) 36.
  3. Ministry for the Environment, The Value of Urban Design: The Economic, Environmental, and Social Benefits of Urban Design (Wellington: Ministry for the Environment, 2005) 2.
  4. P Calthorpe, The Next American Metropolis: Energy, Community, and the American Dream

(New York: Princeton Architectural Press, 2003) 15–16.



2009_710.pngNew Zealand Journal of Environmental Law

dysfunctional. Finally they have come to produce environments which often frustrate rather than enhance everyday life.

UNCED (1992)36 discusses urban form in chapter 7: “Promoting Sustainable Human Settlement Development”. Other related matters are further discussed in chapter 8: “Integrating Environment and Development in Decision-making” and chapter 10: “Integrated Approach to the Planning and Management of Land Resources”. Within this discussion, three particular themes emerge, supported by specific development and governance principles:

a) The efficient and effective use of scarce resources. For example:37

If, in the future, human requirements are to be met in a sustainable manner, it is now essential to resolve these conflicts and move towards more effective and efficient use of land and its natural resources. Integrated physical and land-use planning and management is an eminently practical way to achieve this.

And to:38

Apply economic instruments and develop institutional mechanisms and incentives to encourage the best possible land use and sustainable management of land resources.

b) Internalisation of costs and other externalities. For example:39

Promote policies aimed at recovering the actual cost of infrastructure services, while at the same time recognizing the need to find suitable approaches (including subsidies) to extend basic services to all households.


  1. United Nations Conference on Environment and Development, supra note 6, chapters 7, 8 & 10.
  2. Ibid, chapter 10, clause 10.1.
  3. Ibid, chapter 10, clause 10.6(d).
  4. Ibid, chapter 7, clause 7.41(d).
  5. Ibid, chapter 8, clause 8.31(b).



2009_708.pngForm, and Development Contributions 197

To move more fully towards integration of social and environmental costs into economic activities, so that prices will appropriately reflect the relative scarcity and total value of resources and contribute towards the prevention of environmental degradation.

  1. Integrated and consistent decision-making. For example:41

Using policy instruments (legal/regulatory and economic) as a tool for planning and management, seeking incorporation of efficiency criteria in decisions ...

2.5 The Spatial Principles of Sustainable Urban Form

Based on this dialogue, it is therefore proposed that urban form can make a contribution to sustainability primarily through the way in which three fundamental principles are promoted. These are set out in Figure 1.


Figure 1: Core Principles of Sustainable Urban Form

Western settlement patterns over the past two hundred years have changed dramatically. This has also changed the way in which resources and effort are applied when people meet their daily needs. Carmona et al (2003),42 and

  1. Ibid, chapter 8, clause 8.5(f ).
  2. Carmona et al, supra note 30, chapter 2, “Urban Change”, 20–35.



2009_712.pngNew Zealand Journal of Environmental Law

in particular Newman & Kenworthy (1999),43 describe the “stages” of city development from dense, mixed and walkable cities; to connected nodes along transit spines; then to the low-density and often land use-homogenous “automobile city” that has arisen since the early twentieth century. Divall & Bond (eds) (2003)44 provide additional discourse on the more recent patterns that they describe as “suburbanization”. Newman & Kenworthy (1999) conclude that the patterns associated with the automobile city are the antithesis of urban sustainability, due in particular to the negative social, economic, and environmental outcomes it has been associated with. They note:45

The economic analysis ... suggests that something fundamental has gone wrong with our approach to cities when we plan them around automobiles. It is quite simply the biggest part of the sustainability agenda for cities to reverse these patterns and achieve an approach that reduces the environmental and social impacts of excessive automobile usage while simultaneously improving the city’s economy.

In response, a prevailing view has emerged in support of carefully managed higher-density, mixed, and “walkable” urban environments supplemented by passenger transport services (Newman & Kenworthy, 1999;46 and Ward et al, 2007).47 These are argued as providing the greatest opportunity to maximise exchange and interaction between people and communities while minimising time and resources (including environmental services) spent travelling in between. The Ministry for the Environment (2005) has concluded that when supported by an appropriate transport management regime and mixture of land uses, density-related benefits can include:48

Walkability has been tied to between a five-minute walk of around 400 metres

— encompassing up to 50 hectares of land (English Partnerships, 2001),49 to

  1. Newman & Kenworthy, supra note 16, chapter 2, 27–33.
  2. C Divall and W Bond, Suburbanizing the Masses: Public Transport and Urban Development in Historical Perspective (Aldershot: Ashgate, 2003).
  3. Newman & Kenworthy, supra note 16, at 58–59.

46 Ibid, at 164–180.

  1. M Ward, J Dixon, B Sadler and J Wilson, Integrating Land Use and Transport Planning, Land Transport New Zealand Research Report 333 (Wellington: Land Transport New Zealand, 2007) 17–19.
  2. Ministry for the Environment (2005), supra note 34, at 3.
  3. English Partnerships, supra note 28, at 40.



2009_706.pngForm, and Development Contributions 199

a maximum 10-minute walk of around 800 metres — encompassing up to 200 hectares of land (TCRP, 1997;50 Ministry for the Environment, 2002).51 This has been added to by Edwards & Tsouros (2006)52 and Department of Sustainability and Environment (2005).53 They have connected perceptions of choice, ease, interest, and safety to the matrix of factors people will evaluate before becoming a pedestrian or in particular letting children become pedestrians. In respect of safety, the theory of Crime Prevention Through Environmental Design (“CPTED”) is a relevant contributor to this argument. Reference can be made to Geason & Wilson (1989)54 who comprehensively outline this approach including its emphasis on reducing opportunist crime.

This is focused around ensuring that resources invested in an output deliver the greatest possible quality of that output by maximising opportunities for induced benefits to occur along with other positive externalities. A key focus (as emphasised by Ministry for the Environment, 2002,55 and 2005)56 is pursuit of quality developments that enrich each locality. Low design quality has been suggested as being more likely to invoke perceptions of a lack of ownership, pride, safety, and value (English Partnerships, 2001).57

It also relates to optimising the relationships between land uses (Carmona et al, 2003;58 Newman & Kenworthy, 1999).59 In the context of investment in public amenities, it is proposed that a community facility investment “return” could be measured by use. A recreation reserve may be either very popular or never used for social gain — but still require the same capital, operational, and land use opportunity costs nonetheless.

  1. Transport Cooperative Research Program, Synthesis 20, Transit-Focused Development: A Synthesis of Transit Practice (Washington: Transport Research Board of the National Academies, 1997) 4.
  2. Ministry for the Environment (2002), supra note 29, at 41.
  3. P Edwards and A Tsouros, Promoting Physical Activity and Active Living in Urban Environments (Denmark: World Health Organization Regional Office for Europe, 2006) 10.
  4. Department of Sustainability and Environment, and Crime Prevention Victoria, Safer Design Guidelines for Victoria (Melbourne: Department of Sustainability and Environment, 2005) 8.
  5. S Geason and P Wilson, Designing Out Crime: Crime Prevention Through Environmental Design (Canberra: Australian Institute of Criminology, 1989) 2–9.
  6. Ministry for the Environment (2002), supra note 29, at 8.
  7. Ministry for the Environment (2005), supra note 34, at 5.
  8. English Partnerships, supra note 28, “Detailing the Place”, chapter 5, 85–107.
  9. Carmona et al, supra note 30, at 191–192.
  10. Newman & Kenworthy, supra note 16, at 294–295.



2009_713.pngNew Zealand Journal of Environmental Law

Equity is considered to have two major themes. The first relates to governance, including the funding and cost burden of development choices. The second relates to the way in which urban form itself affects how people can or can not go about pursuing their interests. Considerable work has been undertaken on enabling social and cultural well-being through community-building and “place-making”, with an emphasis on unique and authentic character (Carmona et al, 2003;60 Ministry for the Environment, 2005).61 This relates to enhancing local identity and the significance of individual communities. It can be seen arising as a response to urban patterns of mass-expansion that have been criticised for creating “banal, monotonous development”, where “everywhere looks like everywhere else” (English Partnerships, 2001).62

Equity is also related to matters of diversity and choice (Ministry for the Environment, 2005).63 This focuses on the need to provide opportunity for all members of the community through provision of a range of built outcomes and possible enabled actions. It relates strongly to affordability and accessibility and links to efficiency in the issues of long-term resilience, robustness, and ease of reuse (Ministry for the Environment, 2002).64 It also calls for the design of networks and spaces to allow convenient use by many different types of user groups.

2.6 Indicators of Urban Sustainability

In response to these drivers, many have looked to identify what particular spatial characteristics may make an urban form more or less sustainable. These include Carmona et al (2003);65 Smart Growth Network (2008);66 the New Urbanism movement (2008);67 Calthorpe (1993);68 English Partnerships

  1. Carmona et al, supra note 30, at 106–109.
  2. Ministry for the Environment (2005), supra note 34, at 15 & 19.
  3. English Partnerships, supra note 28, at 12.
  4. Ministry for the Environment (2005), supra note 34, at 15 & 20–21.
  5. Ministry for the Environment (2002), supra note 29, at 33–34.
  6. Carmona et al, supra note 30, at 39–44.
  7. Smart Growth Network, Smart Growth Online webpage, About Smart Growth, at <http://> (accessed 10 October 2008), and Smart Growth Principles, at <> (accessed 10 October 2008).
  8., New Urbanism webpage, New Urbanism: Principles of Urbanism, at

<> (accessed 10 October 2008).

  1. Calthorpe, supra note 35, at 43.



2009_708.pngForm, and Development Contributions 201

(2000);69 European Commission (1996);70 European Commission Specific Targeted Research Programme (2005);71 Newman & Kenworthy (1999);72 and Ministry for the Environment (2002,73 and 2005).74 The Auckland Sustainable Cities Programme (2006)75 identifies additional considerations over the way in which public expenditure is overarchingly directed to achieve those other characteristics. However, common to all are healthier, easier, fairer, and more prosperous lifestyles.

On the basis of these sources, a number of general indicators of sustainable urban form have been synthesised. These help communicate how built form may give effect to urban sustainability spatial principles of efficiency, effectiveness, and equity. They are detailed in Figure 2.

2.7 Urban Sustainability Implications for Community Facilities

It is proposed that there is a clear relationship between urban form, the funding and provision of required community facilities, and the pursuit of community well-being using a sustainable development approach. In light of this, the LGA development contribution provisions can be seen as relating to the following critical urban sustainability opportunities:

  1. Equity and cost recovery in community facilities; and
  2. Internalising the true cost of development impacts and decisions; and
  3. Promoting the most sustainable possible land use outcomes for the well- being of the community.

These are primarily possible through the ability to accurately attribute and embed community facility demand differences between more and less sustainable development outcomes (in terms of relative efficiency, effectiveness, and equity) in the price signals that development contributions establish.

It is not suggested that such price signals will necessarily dominate development choices as there will be many other factors which influence an

  1. English Partnerships, supra note 28, at 14.
  2. European Commission Expert Group on the Urban Environment, supra note 8, “Tools for Sustainable Urban Management”, chapter 2, part 2; “Principles for Sustainable Urban Management”, chapter 3, part 1; and “Sustainability and Spatial Planning”, chapter 7, part 1.
  3. European Commission Specific Targeted Research Programme, TISSUE: Trends and Indicators for Monitoring the EU Thematic Strategy on Sustainable Development of Urban Environment (Luxembourg: European Commission, 2005) 66–68.
  4. Newman & Kenworthy, supra note 16, at 189–190.
  5. Ministry for the Environment (2002), supra note 29, at 31–33.
  6. Ministry for the Environment (2005), supra note 34, at 17–24.
  7. Auckland Sustainable Cities Programme, Success in Sustainability (Manukau: Manukau City Council, 2006) 10.




202 New Zealand Journal of Environmental Law

Figure 2: General Indicators of Sustainable Urban Form



2009_706.pngForm, and Development Contributions 203

overall decision. For example, Christie, Smith & Munro (2008)76 discuss the role of emotional investment in housing. But it is proposed that an inconsistent or even contradictory price signal will not help encourage developers or other subsequent community members to make more-sustainable choices.


This section will briefly introduce the LGA development contribution provi- sions. Three High Court cases had directly addressed development contributions at the time of this research. These are Neil Construction Ltd v North Shore City Council,77 Ballintoy Developments Ltd v Tauranga City Council,78 and Domain Nominee Ltd v Auckland City Council.79

3.1 The Local Government Act 2002 (“LGA”)

The purpose of the LGA is set out at s 3, to “provide for democratic and effective local government that recognises the diversity of New Zealand communities”. To achieve this, the Act performs four critical functions:

Section 10 of the Act then sets out the specific purpose of local government:

  1. H Christie, S Smith and M Munro, “The Emotional Economy of Housing”, in Environment and Planning A (2008) vol 40, 2299.
  2. Neil Construction Ltd v North Shore City Council [2007] NZHC 188; [2008] NZRMA 275.
  3. Ballintoy Investments Ltd v Tauranga City Council, 12 February 2008, Allan J, HC Tauranga, CIV-2007-470-410.
  4. Domain Nominee Ltd v Auckland City Council[2008] NZHC 1351; , [2008] NZRMA 113, [2009] 1 NZLR 113.



2009_715.pngNew Zealand Journal of Environmental Law

This approach has been described as focusing on innovation, devolution, and community engagement (Hutchings, 2004).80 Section 11 of the Act confirms the purpose of the local authority is to give effect to the s 10 matters, as well as performing the duties or exercising the rights conferred on it by the LGA and other enactments. Section 12 critically sets out a substantial devolution of power to local authorities. The High Court in Neil Construction Ltd v North Shore City Council noted in this respect (para 19):81

The greater flexibility provided to local authorities by the broad discretion in s 12(2) is balanced by comprehensive provisions in the Act which require transparency and accountability in the decision-making process of local authorities.

3.2 Principles that Guide the Actions of Local Authorities

Section 14 LGA sets out a comprehensive list of principles that local authorities must act in accordance with. Without derogating the significance of each, the following are considered especially noteworthy in the context of this article:

3.3 Decision-making Powers

Sections 76 and 77 in Part 6 LGA outline the key requirements affecting all decision-making functions of local authorities. This would include any decision to use development contributions. Section 76 is focused on the procedure to be followed in reaching a decision, including a requirement for compliance with

  1. J Hutchings, “Long Term Council Community Plans”, in Planning Quarterly (September 2004) 25–28.
  2. Neil Construction Ltd v North Shore City Council [2007] NZHC 188; [2008] NZRMA 275.



2009_708.pngForm, and Development Contributions 205

other sections (77, 78, 80, 81 & 82) as relevant. Section 77 then requires that in making decisions, the local authority must identify all reasonably practicable options for achieving the objective of the decision, and for each assess:

3.4 What are Development Contributions?

Development contributions are principally addressed in Subpart 5 of Part 8 LGA (ss 197–211). A development contribution is a contribution of cash or land that can be required by a territorial authority in respect of any new development, which includes the subdivision of land (s 198 & s 290). The development must generate demand for capital expenditure on new or improved community facilities by that territorial authority (s 199(1)). Community facilities are defined in s 197 to include reserves, community infrastructure (land or development assets on land to provide public amenities), or network infrastructure (roads and other transport, water, wastewater, and stormwater facilities).

The tool has the potential to provide considerable revenue to territorial authorities. GHD (2007)82 surveyed 23 territorial authorities and found that the projected capital costs for network infrastructure and community infrastructure associated with new development represented on average 28% of total projected capital expenditure83 (rising to 51% in those authorities within the sample identified as being “high growth” areas).84 A further 31% of projected capital expenditure related to improved levels of service and upgrades to which new

  1. GHD Ltd, Rates Enquiry: Report on the Drivers of Local Government Expenditure

(Wellington: GHD Ltd, 2007).

  1. Ibid, at 19.
  2. Ibid, at 15.



2009_716.pngNew Zealand Journal of Environmental Law

development may be a component85 (decreasing to 26% in the “high growth” districts).86

The High Court in Neil Construction Ltd v North Shore City Council reflected on the nature of development contributions as a funding tool for territorial authorities. It concluded (paras 46 & 47):87

A compulsory exaction of money by a public authority for public purposes, enforceable by law ... not a payment for services rendered

— as Latham CJ described a tax in Matthews v Chicory Marketing Board (Vic) [1938] HCA 38; (1938) 60 CLR 263 at 276.

This characterisation has since been followed by the High Court in Ballintoy Investments Ltd v Tauranga City Council,88 and Domain Nominee Ltd v Auckland City Council.89

There are a number of milestones that must be achieved by a territorial authority before it can require development contributions. There are then further requirements over how one is calculated and subsequently used once received. These milestones are:

  1. Adopting a development contribution policy;
  2. Calculating and charging a development contribution;
  3. Obtaining payment; and
  4. Using or refunding a development contribution.

  1. Ibid, at 19.
  2. Ibid, at 15.
  3. Neil Construction Ltd v North Shore City Council [2007] NZHC 188; [2008] NZRMA 275.
  4. Ballintoy Investments Ltd v Tauranga City Council, 12 February 2008, Allan J, HC Tauranga, CIV-2007-470-410, at para 14.
  5. Domain Nominee Ltd v Auckland City Council [2008] NZHC 1351; [2008] NZRMA 113, [2009] 1 NZLR 113,

at paras 54–56.



2009_706.pngForm, and Development Contributions 207

3.5 Adopting a Development Contribution Policy

A development contribution policy sits within the broader context of financial policy-making under the LGA. Pursuant to s 102(4)(d) LGA a policy for development contributions or financial contributions must be prepared and adopted by all local authorities. The key substance of the policy is set out at s 106. The High Court in Ballintoy Investments Ltd v Tauranga City Council has summarised the effect of s 106 (para 11):90

Section 106 imposes on a local authority a number of requirements in respect of its development contribution policy. There is a statutory emphasis upon predictability, transparency, and public availability.

Specifically relevant to development contributions is s 106(2). It states:

A policy adopted under s 102(4)(d) must, in relation to the purposes for which development contributions or financial contributions may be required,—

a) summarise and explain the capital expenditure identified in the long-term council community plan that the local authority expects to incur to meet the increased demand for community facilities resulting from growth; and

b) state the proportion of that capital expenditure that will be funded by—

(i) development contributions:

(ii) financial contributions:

(iii) other sources of funding; and

  1. explain, in terms of the matters required to be considered under section 101(3), why the local authority has determined to use these funding sources to meet the expected capital expenditure referred to in paragraph (a); and
d) identify separately each activity or group of activities for which a development contribution or a financial contribution will be required and, in relation to each activity or group of activities, specify the total amount of funding to be sought by development contributions or financial contributions; and

e) if development contributions will be required, comply with the requirements set out in sections 201 and 202; and

f ) if financial contributions will be required, summarise the provisions

  1. Ballintoy Investments Ltd v Tauranga City Council, 12 February 2008, Allan J, HC Tauranga, CIV-2007-470-410.



2009_717.pngNew Zealand Journal of Environmental Law

that relate to financial contributions in the district plan or regional plan prepared under the Resource Management Act 1991.

Section 101(3) LGA is a critical component in the exercise of allocating total forecast capital expenditure for growth-related community facilities between funding tools. It states:

The funding needs of the local authority must be met from those sources that the local authority determines to be appropriate, following consideration of,—

a) in relation to each activity to be funded,—
(i) the community outcomes to which the activity primarily contributes; and

(ii) the distribution of benefits between the community as a whole, any identifiable part of the community, and individuals; and

(iii) the period in or over which those benefits are expected to occur; and

(iv) the extent to which actions or inaction of particular individuals or a group contribute to the need to undertake the activity; and

(v) the costs and benefits, including consequences for transparency and accountability, of funding the activity distinctly from other activities; and

(b) the overall impact of any allocation of liability for revenue needs on the current and future social, economic, environmental, and cultural well- being of the community.

In determining the proportion of capital expenditure to be met by development contributions, a local authority must go through a wide-ranging evaluative process. Amongst other things, this takes into account efficiency and effectiveness, well-being, and equity for the entire district. In Neil Construction Ltd v North Shore City Council it was found that the consideration required in respect of each activity must (para 212):91

... extend to and include each of the five factors in s 101(3)(a) in each case. The factors are clearly stated to be cumulative, not alternatives or options for consideration and determination by a council.

In coming to a view on the overall impact of funding activities by various sources, territorial authorities may contemplate proportionality between funding sources for the same activity. It is noted that the exception to this would be the

91 Neil Construction Ltd v North Shore City Council [2007] NZHC 188; [2008] NZRMA 275.



2009_708.pngForm, and Development Contributions 209

use of both development contributions and financial contributions under the Resource Management Act 1991 (“RMA”) to fund the same activity (refer to Domain Nominee Ltd v Auckland City Council for further discussion on this point).92 The consequence of these requirements is that territorial authorities should not simply see the development contribution tool as a means to raise the greatest possible revenue from new development. The Joint Central Government Local Authority Funding Project Team (2005)93 tellingly suggests that this may, however, have been the case:

We have also found that powers to assess development contributions under the Local Government Act are being used by almost half the eligible local authorities, and more are likely to access these in the near future. Not surprisingly the local authorities that are currently using this tool are those for whom the tool is likely to generate the highest level of revenue ...

Sections 201 and 202 then set out the substantive requirements of the policy proper. Section 201 requires:

Section 202 requires a schedule to be prepared within the policy. The schedule is required to make clear the contributions that will be required for reserves, community infrastructure, and network infrastructure, for all parts of the district where different contributions are to be required. It must also state the event that will give rise to the requirement; being either the granting of a resource consent or building consent, or authorisation for a service connection. A methodology

  1. Domain Nominee Ltd v Auckland City Council [2008] NZHC 1351; [2008] NZRMA 113, [2009] 1 NZLR 113,

at para 84.

  1. Joint Central Government Local Authority Funding Project Team, Local Authority Funding Issues (Wellington: Department of Internal Affairs, 2005) 7.



2009_718.pngNew Zealand Journal of Environmental Law

within the schedule must provide the calculation of development contributions in accordance with Schedule 13 of the Act.

Schedule 13 in turn contains two key requirements. The first is identification of the total cost of capital expenditure expected to be incurred for each community facility, activity, or group of activities identified within the Long Term Council Community Plan (“LTCCP”) pursuant to s 106(2)(a). The second requires this expenditure to be allocated to individual units of demand as identified by the territorial authority. A unit of demand is the term used in the LGA to describe a quantified base charge. If multiplied by the number of units of demand generated by a development it will provide the maximum contribution that can be charged for network infrastructure and community infrastructure for that development (s 203(2)). In Neil Construction Ltd v North Shore City Council the High Court confirmed that territorial authorities have discretion in relation to the unit of demand they adopt subject to Schedule 13(2).94 Schedule 13(2) specifically states:

For the purpose of determining in accordance with section 203(2) the maximum development contribution that may be required for a particular development or type of development, a territorial authority must demonstrate in its methodology that it has attributed units of demand to particular development or types of development on a consistent and equitable basis.

Overall, ss 201 and 202, and Schedule 13, make it clear that territorial authorities must take a comprehensive approach to calculating development contributions. This must be appropriately based on the actual characteristics of each development and its resulting demand for community facilities. This policy-making process has been summarised in Figure 3.

3.6 Requiring a Development Contribution

Once a development contribution policy has been adopted, a territorial authority must comply with further provisions before it can require an actual contribution from a development. These are summarised in Figure 4.

94 Neil Construction Ltd v North Shore City Council [2007] NZHC 188; [2008] NZRMA 275, at para 71.

Sustainable Development, Urban Form, and Development Contributions


Figure 3: Developing a Development Contributions Policy





212 New Zealand Journal of Environmental Law

Figure 4: Requiring a Development Contribution

This process sets in place a number of safeguards to balance the lack of any actual appeal rights in the legislation to challenge an imposed charge (s 198(3)). The Joint Central Government Local Authority Funding Project Team (2005)95 has discussed this characteristic, concluding that challenge could only be

95 Joint Central Government Local Government Funding Project Team, supra note 93.



2009_708.pngForm, and Development Contributions 213

against a development contribution policy to the High Court. Such an appeal could only be on the grounds that the territorial authority erred in law when preparing its policy.

3.7 Obtaining and Using a Development Contribution, and Refunding

Section 203 sets out the maximum development contributions that can be required by a territorial authority. However, above this, territorial authorities may accept additional contributions agreed to by a developer.

In respect of a development which is required to make a development contribution, s 208 sets out the powers available to the territorial authority if it remains unpaid. A territorial authority can:

Sections 204, 205 and 206 confirm that a development contribution must only be used for or towards the capital expenditure for which the contribution was required. Ongoing maintenance of community facilities must be funded from other sources. Lastly, ss 209 and 210 relate to the circumstances when a development contribution must be refunded by the territorial authority. There are essentially two (s 209(1)):

  1. If a development does not proceed. This includes the lapsing or surrender of a resource consent under the RMA 1991, or the lapsing of a building consent under the Building Act 2004 (s 209(1)(a), (b), (c)).
  2. If a territorial authority does not provide the reserve, network infrastructure, or community infrastructure for which the development contribution was required (s 209(1)(d)).

3.8 Characteristics of Development Contributions

The development contribution provisions, while giving territorial authorities an explicit means to protect existing communities from the inequities of funding



2009_722.pngNew Zealand Journal of Environmental Law

the community facilities required by and for the benefit of new members, do not in themselves work both ways. The historical funding of existing community facilities may have been through a debt structure, repaid over time through a proportion of general rates. When adopting a development contribution policy in the interests of funding equity and fairness for existing community members, there is no parallel requirement or reference within Subpart 5 of Part 8 that would protect new community members who have paid a development contribution from then additionally paying, through their rates, for the historical community facility debt incurred by those before them. This possible limitation could undermine the authenticity of a policy claimed to be based on delivering equity between existing and new community members.

Section 202(2) allows the particular demands for community facilities generated by developments in different locations within a district to be localised within a development contribution policy. In sending a clear signal that a “one size fits all” approach to requiring development contributions may not always be appropriate, this seems to acknowledge that the same development type may generate different demands for community facilities in different locations. It also allows for the proportion of capital costs collected through development contributions for the same type of development to vary between locations. Existing community facilities may also have localised capacity issues, and the costs of providing new community facilities may also vary in different locations (for example, significant differences in land price or infrastructure condition). In conjunction with s 101(3) this raises the prospect of communities rewarding development choices that give them the greatest sustainability and well-being “return” in terms of type and location, through reduced development contribution requirements.

The ability to recover the capital costs of community facilities from developers could superficially support a more permissive planning regime over development type and location — if the developer is content to pay the costs of any inefficiency, what’s the problem? Such is considered to be a very short-term view. The intergenerational impact of ongoing maintenance is a key well-being issue. Looking at the 50–100-year timeframe and beyond, the maintenance requirement of many community facilities will amount to an (eventual) need for complete system replacement, over and above minor “patching” over the years, or technology shifts (for example, the historical transition from clay-based to plastic-based infrastructure pipes). Essiambre-Philips-Desjardins Associates



2009_706.pngForm, and Development Contributions 215

Ltd (1997)96 developed an urban sustainability-based development scenario and compared it to a “status quo” in Ottawa-Carleton, Canada. It identified that significant 75-year life-cycle operational and maintenance savings could be obtained by the public sector attributable purely to the design, configuration, and location of residential developments.

Communities could look to minimise future burdens (including on rates) by looking to encourage development types and locations that bring with them the lowest long-term operation and maintenance costs. They may also look to reward development configurations most likely to meet future lifestyle needs (where these have been articulated, such as in growth management policies) rather than those perhaps suited solely to the preferences of the current generation.

A remissions scheme pursuant to s 201(1)(c), at the full discretion of the territorial authority, could be used to emphasise the price incentive of strategic locations or development types. However, a remissions scheme has one possible drawback if used en masse, depending on whether it has the effect of providing a development (“Development A”) with an intended discount where the community meets part of the cost of its community facilities; or whether it was instead simply reconciling the true demand of a development with the demand it had been incorrectly attributed. In the case of the first, the remission would essentially be a “reward” or other acknowledgement that looked to subsidise the capital costs fairly attributed to a particular development. In the second, the development receiving the remission would have been incorrectly overcharged to start with. This would indicate that the development was either the equivalent of a statistical outlier (if a rare occurrence), or that there was an inadequacy in the methodology and attribution of demand within the policy (if a regular occurrence).

In the latter, the remission would have the effect of reducing the required contribution, but amount to the development still paying for the full actual demand it generated. The discount given by the remission would in fact amount to a subsidy to another development elsewhere in the district (“Development B”) which to balance the fixed total cost of identified community facilities must have had demand under-attributed to create the corresponding over-attribution affecting Development A. If this occurred on a large scale the effect could be an unintentional “hidden subsidy” in favour of particular development “B” or

96 Essiambre-Philips-Desjardins Associates Ltd, Conventional and Alternative Development Patterns: Phase I: Infrastructure Costs (Ottawa: Canada Mortgage and Housing Corporation, 1997) 39.



2009_723.pngNew Zealand Journal of Environmental Law

types of development “B”. Conversely, this could create a direct disincentive to undertake development “A”, despite it generating less demand than the standardised unit(s) of demand attributed and hence being possibly more sustainable than type “B”.

3.9 The Challenge for Development Contribution Policies

The key challenge seems to lie in how to manage development contribution regimes so that they are able to be flexible and truly equitable in attributing demand between individual new developments while also being able to provide sufficient certainty to territorial authorities carrying long-term financial risk. An unreliable revenue source could itself prove to have negative impacts on the well-being of a community. The High Court contemplated the balance between development-specific and generic charges in Neil Construction Ltd v North Shore City Council.97 After considering the language of s 199(3), the Court concluded that each individual development must pass the Act’s “demand” tests, not development generally or collectively, because of (para 112):

The wording of subs (3) which authorises councils to take into account the cumulative effect(s) of ‘a development’ (singular) with ‘another development’ (singular). While this may lead to the assessment of the cumulative effects of more than one or a number of ‘developments’, it does not authorise a collective approach to capital expenditure for development generally.

The Court ultimately held that (para 120):

... the Act requires that before a development contribution may be required by the Council, there must be a ‘development’ and a direct causal nexus between that ‘development’ and the demand for infrastructure it, either alone or jointly with another development, generates. This necessarily requires the Council to determine as a preliminary point, on a case by case basis, whether a particular project is a ‘development’ as defined in s 197.

This case-sensitivity must, however, be balanced with the realistic level of accuracy possible in what Hutchison & Sandbrook (2004)98 term the Act’s

97 Neil Construction Ltd v North Shore City Council [2007] NZHC 188; [2008] NZRMA 275, at paras 97–120. 98 C Hutchison and J Sandbrook, “Development Contributions under LGA”, in Planning

Quarterly (September 2004) 16–17.


Sustainable Development, Urban Form, and Development Contributions 217

“future oriented approach”. They identify the inevitable differences that will occur between projected growth and actual growth in a community over the course of several years. Taking this practicality into account, it therefore seems likely that some level of inequity within a development contribution policy may be inevitable in making the tool workable. The task for territorial authorities would then be in judiciously identifying and attributing demand between developments to minimise these risks. The selection of an appropriate unit of demand seems to have a unique significance to the integrity of development contribution regimes.


It is proposed that urban sustainability principles relate to most if not all forms of community facility. The Department of Prime Minister and Cabinet (2003) is consistent with this view:99

Carruthers & Ulfarsson (2003)100 have reviewed previous studies and in so doing acknowledged that both very high densities and lower “suburban” type densities have been shown to create significant cost and resource inefficiency issues.101 However, across all infrastructure types, their research of 283 metropolitan counties in the US for the period 1982 to 1992 concluded that overall lower density and increased urban “spread” led to demonstrably higher infrastructure costs for communities. Decreases in those costs correlated strongly with increasing density and land use mix.102 They do, however, take care to point out that other factors than just cost will influence the quality of services delivered.103 For the purposes of this article, only network infrastructure will be


  1. Department of Prime Minister and Cabinet, supra note 10, at 20.
  2. J Carruthers and G Ulfarsson, “Urban Sprawl and the Cost of Public Services”, in

Environment and Planning B: Planning and Design 2003, vol 30, 503–522.

  1. Ibid, at 506.

102 Ibid, at 513–518.


218 New Zealand Journal of Environmental Law

4.1 Network Infrastructure

UNCSD (2005)104 emphasises the critical importance of roads and other transport. TCRP (1999) is more direct in this respect. It states:105

Transportation is, in many ways, the most important segment of a community’s infrastructure. A community’s transportation system has a profound influence on its land use patterns and rate of growth. Not only is the transportation network a shaper of urban form, but a region’s land use patterns influence the transportation modes used for work and nonwork interurban travel.

(a) The costs of auto-centric urban patterns

The location and type of residential development will have an impact on resultant demand for transport. Homogenous, dispersed residential development will have a greater reliance on vehicular transport to access work, education and other opportunities than units located in closer proximity to these, or alternatively those which can enjoy use of a passenger transport system (TRCP, 1997;106 European Commission, 2007).107 Newman & Kenworthy (1999)108 have further identified a statistically significant correlation between cities which have the greatest degree of automobile dependence and those spending the greatest proportion of total Gross Regional Product on overall transportation. They comprehensively demonstrate that cities based around automobile dependence are more costly and environmentally damaging than alternatives, much of which is not internalised into the costs of private automobile use. They conclude:109

... many studies in different parts of the world have found that the subsidy provided to the car is about US$3,000 to 4,000 per vehicle per year for roads, parking, health costs, pollution costs, and so on. From this perspective it is clear that the ‘car is on welfare’.

  1. United Nations Commission on Sustainable Development, supra note 9, at 8.
  2. Transport Cooperative Research Program, Legal Research Digest no 12, The Zoning and Real Estate Implications of Transit Oriented Development (Washington: Transport Research Board of the National Academies, 1999) 3.
  3. Transport Cooperative Research Program, supra note 50, at 7.
  4. European Commission, Sustainable Urban Transport Plans: Preparatory Document in Relation to the Follow-up of the Thematic Strategy on the Urban Environment (Luxembourg: European Commission, 2007) 7–8.
  5. Newman & Kenworthy, supra note 16, at 123–124.



2009_708.pngForm, and Development Contributions 219

The European Commission (1996)110 is consistent with this cost estimate. It has furthermore associated the inability to correctly price these impacts with subsequent unsustainable travel behaviour.

Land Transport New Zealand (2006)111 confirms that at the end of 2006 there were 2,288,281 licensed cars in New Zealand. If Newman & Kenworthy’s figure of USD$3,000–$4,000 were to be accepted as approximate, this would equate to the order of USD$6,864,843,000–$9,153,124,000 (levels unadjusted from Newman & Kenworthy’s 1999 publication date) per year in non-priced, non-captured automobile subsidy.

In addition to this, NIWA (2008)112 has estimated the emissions from the New Zealand motor vehicle fleet in 2001 at 12,539,753 tonnes of CO2; 2,870 tonnes of CH4; and 340 tonnes of N2O.113 Most of the fleet was comprised of private cars.114 Development patterns which reduced rather than increased this pollution while maintaining or increasing the amount of activity and interaction undertaken would present an obvious attraction in sustainability terms.

(b) The benefits of multi-modal urban patterns

Ewing, Pendall & Chen (2002) have found that relative to compact and dense outcomes, more spread-out development forms are likely to lead to:115

Transfund New Zealand (2001)116 has identified daily vehicular trip generation rates associated with different types of residential development and compared

  1. European Commission Expert Group on the Urban Environment, supra note 8, “Key Sustainability Issues”, chapter 6, part 2, “Movement in Cities”, subpart 1, para 27.
  2. Land Transport New Zealand, New Zealand Motor Vehicle Registration Statistics 2006

(Palmerston North: LTNZ, 2006) 59.

  1. National Institute of Weather and Atmospheric Research webpage, National Centre for Climate — Energy Solutions, at < transport> (accessed 10 October 2008).
  2. Ibid, at Transport Emissions Excel Spreadsheet. 114 Ibid.
  3. R Ewing, R Pendall and D Chen, Measuring Sprawl and its Impact (Washington: Smart Growth America, 2002) 5.
  4. Transfund New Zealand, Research Report 209, Trips and Parking Related to Land Use: Volume 1 (Wellington: Transfund New Zealand, 2001).



2009_728.pngNew Zealand Journal of Environmental Law

them with both Australian117 and American118 rates. They are comparable (p 69, Table 6.1):

Dwelling house
Medium-density residential

The NSW Roads and Traffic Authority (2002)119 additionally identified high- density units. These relate to apartment-type living in CBDs and subregional centres. No daily trip generation rate is provided although peak-hour trip rates of 0.24–0.29 per unit are provided.120 Extrapolating the approximate 10% relationship between total daily vehicle trip generation and peak-hour vehicle trip generation for other residential activities observed in both Transfund (2001)121 and Roads and Traffic Authority (2002),122 this would equate to a daily trip generation in the order of 3 to 4 trips per unit. This is consistent with the US Institute of Transportation Engineers (“ITE”) (2003),123 which states that high- rise residential (more than 10 storeys) typically generates 4.2 vehicle trips per day, per unit. It is also consistent with the calculations of the City of San Diego (2003), the only additional reference on this matter available.124

These rates are fundamentally related to residential type and location. The highest-density units exist in the most mixed, highly priced land settings such as CBDs and subregional centres where it is cost-effective to build upwards. Medium-density units also have a relationship with valuable town centres and transport nodes. Detached, low-density dwellings occur on less-valuable, peripheral land where the low intensity of use is appropriate to the utility of the land. The Ministry for the Environment (2002)125 has summarised this relationship which has been adapted as Figure 5.

  1. Please refer to Roads and Traffic Authority, Guide to Traffic Generating Developments, Version 2.2 (Sydney: Roads and Traffic Authority, 2002) for more specific information.
  2. Please refer to Institute of Transportation Engineers, Trip Generation, 7th ed (Washington: Institute of Transportation Engineers, 2003) for more specific information.
  3. Roads and Traffic Authority, supra note 117, at 3-2–3-3. 120 Ibid.

121 Transfund New Zealand, supra note 116, at 69, Table 6.1. 122 Roads and Traffic Authority, supra note 117, at 3-2.

123 Institute of Transportation Engineers, “High Rise Apartments”, Land Use Code 222 (2003). 124 City of San Diego, Land Development Code: Trip Generation Manual (San Diego: City of

San Diego, 2003) 6, Table 1.

125 Ministry for the Environment (2002), supra note 29, at 34.




Sustainable Development, Urban Form, and Development Contributions 221

Figure 5: Urban Residential Type Relative to Location

Recent research by TCRP (2008)126 looked at specifically configured Transit Oriented Developments in the United States (these are based on the careful concentration of density and mixed activity around major passenger transport infrastructure).127 For medium- and high-density units the research found that the actual trip generation observed was often less than half of the typical ITE trip generation rates.128 The research also noted the negative impacts on

  1. Transport Cooperative Research Program, Report 128, Effects of TOD on Housing, Parking, and Travel (Washington: Transport Research Board of the National Academies, 2008).
  2. Ibid, at 4.
  3. Ibid, at 36.



2009_730.pngNew Zealand Journal of Environmental Law

development caused by the overestimate of vehicle trip generation including through excessive impact fees.129

(c) Trip generation alone is not a demand for new capital expenditure

An apartment in a busy, employment-focused CBD that generates 4 vehicle trips per day, due to the location of the apartment relative to the services being accessed, may not generate any actual demand for new capital expenditure on roads or other transport infrastructure. If the nature of those vehicle trips is “counter flow”, opposite to the dominant peak-travel direction, the trips may in fact equate to a more efficient use of existing road investment. This may be more sustainable than, for instance, a new peripheral greenfield subdivision where traffic generation contributes to cumulative peak-period congestion and more demand for road widening. It is proposed that this scenario is consistent with that considered by the High Court in Neil Construction Ltd v North Shore City Council at para 114.130 The Court outlined a hypothetical scenario (“Project C”) where in the first instance a development generates a demand for community facilities and therefore passes the trigger for a territorial authority to require a development contribution (s 197 LGA), but then fails the s 199 LGA trigger as the development131

[d]oes not require additional assets or assets of increased capacity (e.g. because existing infrastructure will adequately cope).

Data released by Auckland City in 2001132 — the location of the greatest amount of high-density residential development in the country — demonstrates consistency with international literature review findings. For example:

  1. Ibid, at 54.
  2. Neil Construction Ltd v North Shore City Council [2007] NZHC 188; [2008] NZRMA 275. 131 Ibid, at para 114.

132 Auckland City Council, Auckland Central CBD Resident Population: Key Socio-economic Characteristics and Trends of People Living in the CBD (Auckland: Auckland City Council, 2002).



2009_706.pngForm, and Development Contributions 223

used a private vehicle (excluding passenger transport). For the Auckland region these rates were 5% and 50% respectively (pp 4–5).

Failing to respond to these issues in a development contribution policy, through both accurate cost recovery and management of the price signals sent out, may not result in an equitable or consistent attribution of demand as required by Schedule 13(2) LGA.

(a) All piped networks leak

The United States Environmental Protection Agency (“EPA”) (2006)133 has stated that any piped infrastructure dealing with water supply will leak, losing up to 25% of the water carried.134 The amount of leakage will increase as the length of that network increases, and as water pressure increases. Equivalent issues exist with wastewater pipes.

The source of leaking relates to connections, joints, and junctions between pipes as well as cracks and other damage to pipes. The EPA notes a 1995 loss of drinking water within the US domestic water supply system from these sources of 25.3 billion gallons of water per day (9.2 trillion gallons in that year).135 Much of the value of this resource was lost given that most water use is metered at the end-of-pipe point of consumption. In response to this and the increasing global importance of potable water as a scarce resource, local authorities could look to encourage development patterns which reduce this inefficiency.

(b) Land use density and household size affects water and wastewater demand The broader efficiency of network use relative to land use and development was also examined by the EPA. It commented (p 6):

Building new infrastructure to serve developments on the urban fringe can decrease the overall return on a community’s water infrastructure investment. Often, metropolitan service areas have excess capacity. Adding new developments to the existing network spreads the system’s capital costs over a larger customer base, lowering the cost of water service per customer.

Household size and the nature of dwelling type will also have an impact on water/wastewater demand. If it is accepted that the “typical” daily demand for

  1. Environmental Protection Agency (“EPA”), Growing Toward More Efficient Water Use: Linking Development, Infrastructure, and Drinking Water Policies (Washington: Environmental Protection Agency, 2006).
  2. Ibid, at 4.
  3. Ibid.



2009_731.pngNew Zealand Journal of Environmental Law

water consumption can be standardised per person, then the number of people consuming that unit per household will play a large part in overall water demand for that household. Auckland City Council (2002)136 identified that in the Auckland CBD, 2001, 82% of households were composed of 2 or less persons. The CBD had an average overall household occupancy of 2.2 persons; at that time the average occupancy for the Auckland Region as a whole was 2.9 persons per household.137 This suggests that, all else being equal, approximately 25% less demand for water and wastewater supply may exist in CBD households. It could translate into a significant monetary amount being unjustifiably required in a development contribution if not attributed correctly.

TCRP (2002)138 considered requirements for new water supply and wastewater infrastructure in its models for growth to 2025 in the US. It concluded that, generally, it was most costly to install this infrastructure in higher-density urban areas; then 20% less in typical suburban locations; and a further 10% less in rural conditions.139 This was based on difficulties in working in built-up areas, and the increasing amount of ageing infrastructure requiring replacement that tends to exist in the most built-up areas. Despite this low- density cost bias, the model still demonstrated that, overall, a higher-density managed-growth approach would be cheaper than an unconstrained-growth option. The saving was predicted to be in the order of:

(c) House type affects water/wastewater demand

In addition to this, EPA (2006),142 and in particular Randolph & Troy (2008),143 have confirmed that residential density and type impact on demand for water use. Outdoor water use for gardens is singled out as a key contributor to demand in lower-density “suburban” settings. A well-irrigated 1,000m2 section will use more water than the pot plants decorating a 6m2 apartment balcony. Similarly, a

136 Auckland City Council, supra note 132, at 2. 137 Ibid, at “Summary CBD Table”, 7.

  1. Transport Cooperative Research Program, Report 74, Costs of Sprawl — 2000 (Washington: Transportation Research Board of the National Academies, 2002) 217–222.
  2. Ibid, at 220.
  3. Ibid, at 222.
  4. Ibid.
  5. EPA, supra note 133, at 6.
  6. B Randolph and P Troy, “Attitudes to Conservation and Water Consumption”, in

Environmental Science and Policy 11 (2008) 441–455.



2009_708.pngForm, and Development Contributions 225

house designed to minimise water/wastewater use, such as through water tanks, water reuse, and composting toilets, can deliver clear efficiencies.

Failing to respond to these matters in a development contribution policy may not result in an equitable or consistent attribution of demand as required by Schedule 13(2) LGA.

(a) Demand linked to impervious surface

The demand for stormwater facilities will relate largely to the amount of stormwater runoff generated by a development. There will be inevitable differences between individual developments, aside from size and scale of development (such as roof profile, driveway and vehicle manoeuvring spaces, etc). One key source of difference in demand generation will be the number of residential units within a building. A one-level, single unit on a site with an impervious surface area of 400m2 will generate a much higher demand per unit than a 10-level building with 4 units per level and 400m2 impervious surface area (a net of 10m2 impervious surface per unit). The previously identified disadvantage of larger piped networks will also apply to stormwater facilities.

(b) Techniques available to reduce runoff from developments

The principles of Low Impact Urban Design and Development (“LIUDD”) are also relevant to this type of network infrastructure. Techniques that reduce the burden on stormwater infrastructure by retaining captured runoff for either quality (removal of pollutants via settling) or quantity (peak-flow attenuation by capture) can influence the demand generated by individual developments. Examples can include rain tanks, rain gardens, or swales. Not only do these have a lower demand requirement, they will ultimately contribute to less overall discharge into downstream waterways. Van Roon & van Roon (2005)144 provide further detail on the principles of LIUDD.

Failing to respond to these matters in a development contribution policy may not result in an equitable or consistent attribution of demand as required by s 13(2) LGA.

  1. M van Roon, and H van Roon, Low Impact Urban Design and Development Principles for Assessment of Planning, Policy, and Development Outcomes, Working Paper 051, Centre for Urban Ecosystem Sustainability (Auckland: Landcare Research Ltd, 2005).



2009_732.pngNew Zealand Journal of Environmental Law

4.2 Implications for Unit of Demand

The evidence on residential development and demand for network infrastructure suggests that there are at least three distinct types of housing that can describe different lifestyle dynamics and infrastructure issues. They are:

In addition, it seems difficult to accurately attribute network infrastructure demand without also giving consideration to household size (especially relative to water and wastewater services). Lastly, the ability to internalise the efficiencies of site-specific features such as rain tanks may also be important, although whether these can be managed with greater certainty than a remission system would depend on the possible configurations and variability likely. An illustrative-only matrix has been included as Figure 6 to suggest one way that these two fundamental dynamics could be used in a development contribution policy.


5.1 Introduction to Case Study Development Contribution Policies

Six territorial authorities with development contribution policies were examined in late 2008. These were:

  1. Auckland City Council, “Appendix: Development Contributions Policy”, in Auckland City Council’s Annual Plan 2008/2009 (Auckland: Auckland City Council, 2008).
  2. North Shore City Council, North Shore City Council 2006 Development Contributions Policy: July 2006 (Takapuna: North Shore City Council, 2006).



2009_706.pngForm, and Development Contributions 227


Figure 6: Illustrative Example of Matched Housing Type to Household Size

The purpose of the case study was to understand how each policy managed the demand for community facilities generated (if at all) by residential developments. The case study did not attempt detailed assessments of the policies in their entirety, nor did it look to specifically assess their compliance with statutory requirements.

  1. Waitakere City Council, “Development Contributions and Financial Contributions Policy”, in Long Term Council Community Plan 2006–2016, vol 4 (Henderson: Waitakere City Council, 2006).
  2. Hamilton City Council, “Development and Financial Contributions Policy”, in Council’s 2006–2016 Long Term Plan, vol II (Hamilton: Hamilton City Council, 2008).
  3. Wellington City Council, Development Contributions Policy: July 2007 (Wellington: Wellington City Council, 2007).
  4. Christchurch City Council, Development Contributions Policy 2007/09 (Christchurch: Christchurch City Council, 2007).



2009_734.pngNew Zealand Journal of Environmental Law

Figure 7 presents a summary of the development contribution policy assessment.


Figure 7: Summary of Development Contribution Policy Analysis



2009_708.pngForm, and Development Contributions 229

5.2 Local Baseline of Urban Sustainability

Analysis of the major New Zealand subregional growth strategies (Auckland Regional Growth Strategy 1999;151 Bay of Plenty Smart Growth Strategy (revised) 2007;152 Wellington Regional Strategy 2007;153 and the Greater Christchurch Urban Development Strategy 2007)154 confirms that the urban sustainability indicators identified at section two of this article are reflected to varying but clearly dominant degrees within each. For instance, all focus on consolidation within existing nodes and around passenger transport routes to deliver higher-density, more mixed use outcomes that are walkable, safe, and prosperous.155

Three of the territorial authorities (Auckland City, 2003;156 North Shore City, 2002;157 and Wellington City, 2006)158 have adopted city-specific growth policies. These are each consistent with their relevant subregional growth strategy as well as the urban sustainability indicators identified in this research. Hamilton City,159 and Waitakere City,160 are in the process of adopting such growth policies. Draft material on these available at the time of this research emphasises urban sustainability principles discussed within this article. No evidence has been found to suggest that Christchurch City has or is in the process of adopting a specific growth policy, although it is noted that the Greater Christchurch Urban Development Strategy is very Christchurch City-

  1. Auckland Regional Growth Forum, Auckland Regional Growth Strategy: 2050 (Auckland: Auckland Regional Growth Forum, 1999).
  2. SmartGrowth Implementation Committee, SmartGrowth — The Western Bay of Plenty Sub Region 50 Year Strategy and Implementation Plan (Tauranga: SmartGrowth Implementation Committee, 2007).
  3. Greater Wellington Regional Council, Wellington Regional Strategy (Wellington: Greater Wellington Regional Strategy, 2007).
  4. Greater Christchurch Urban Development Strategy Forum, Greater Christchurch Urban Development Strategy and Action Plan 2007 (Christchurch: Greater Christchurch Urban Development Strategy Forum, 2007).
  5. For example, refer to Auckland Regional Growth Forum, supra note 151, chapter 3, 26–52, and “Growth Concept” map, 76; and Greater Christchurch Urban Development Strategy Forum, supra note 154, chapter 5, 32–44, including “Indicative UDS Settlement Pattern” map, Figure 13, 39.
  6. Auckland City Council, Auckland City Growth Management Strategy (Auckland: Auckland City Council, 2003).
  7. North Shore City Council, City Blueprint (Takapuna: North Shore City Council, 2002). 158 Wellington City Council, Wellington Urban Development Strategy: Directing Growth and

Delivering Quality (Wellington: Wellington City Council, 2006).

  1. Hamilton City Council, Hamilton Urban Growth Strategy: A Compact and Sustainable City

(Hamilton: Hamilton City Council, 2008).

  1. Waitakere City Council, Growth Management Strategy for Waitakere City: Working Draft — August 2006 (Henderson: Waitakere City Council, 2006).



2009_736.pngNew Zealand Journal of Environmental Law

centric, and gives clear urban sustainability direction.161 In all of the policies, a clear connection is made between optimal community benefits and specific configurations and locations for new development. A succinct but representative expression is given by Wellington City Council (2006) (p 4):

For Wellington, benefits are greatest when most new growth is directed to areas that are already well-connected, offer high levels of amenity, and have some (or all) of the supporting infrastructure.

These conditions exist around the central city, some suburban centres, key transport routes, and in specific parts of the City’s northern suburbs ...

Directing growth in this manner and improving the quality of development will contribute to making the city:

In all cases a partial exception relates to the urban sustainability principles identified which focus on the equitable allocation of community burdens, and local decision-making. These are identified in all instances but are not considered to act as major themes; the policies instead have a clear focus on the spatial and physical networks that are sought. A brief summary of the correlation between urban sustainability indicators identified in this research and the themes included in the territorial authority growth policies is included as Figure 8.

As the forerunner strategy, the Auckland Regional Growth Strategy has had a longer opportunity for implementation. The Auckland Regional Growth Forum (2007)162 has reviewed its strategy and found that while the rate of residential intensification was beginning to accelerate towards its 70% target, a significant proportion of it was occurring outside of the locations identified as preferable within the strategy. It concludes with a number of actions to

  1. Greater Christchurch Urban Development Strategy Forum, supra note 154.
  2. Auckland Regional Growth Forum, Growing Smarter: An Evaluation of the Auckland Regional Growth Strategy, 1999 (Auckland: Auckland Regional Growth Forum, 2007).




Sustainable Development, Urban Form, and Development Contributions 231

Figure 8: Comparison of Urban Sustainability Principles with Local Policy

redress this divergence, broadly based around greater effort and planning.163 These include one specific action related to the coordination and integration of infrastructure to ensure it contributes to achieving urban form goals.164 The Department of Internal Affairs (2008) has also identified that ideal development patterns to support sustainable development are not occurring:165

Developments do not [currently] seem to be delivering the required density or quality in strategic locations to achieve this. Nor is the current level of

163 Ibid, at Table 15, 113–115.

  1. Ibid, at Action 4, 114.
  2. Department of Internal Affairs, Building Sustainable Urban Communities (Wellington: Department of Internal Affairs, 2008) 5.



2009_738.pngNew Zealand Journal of Environmental Law

development providing a range of housing choices in the required quantities and locations.

In light of the issues identified in this research it could be reasonable to conclude that a sustainable development approach would require some level of engagement between development contribution policies and the enablement of these strategic growth approaches.

5.3 Analysis of Development Contribution Policies

All six policies require development contributions from residential development. Auckland City (one-bedroom units), North Shore City (retirement villages), and Christchurch City (family flats, and units below 100 m2 GFA in multi-unit developments) identify specific types of residential development in addition to a standardised household that will attract development contributions. Waitakere City, Hamilton City, and Wellington City treat all residential units as equivalent irrespective of type or size. Refer to Figure 9 for a summary of the identified residential development types.


Figure 9: Summary of Residential Development Types Identified Within Policies

All policies require different contributions in different parts of each respective district. It seems these are in all cases based on the geographic catchment within which community facilities are required. This includes strategic new growth areas such as “Wynyard Point” in Auckland City. In respect of the s 101(3) funding tool analysis required in each policy, it seems that the overall benefits and costs of growth are broadly deemed to be equivalent irrespective of residential type, size, or location within the districts. This creates an immediate inconsistency with the authorities’ urban growth policies, which are based on this quite fundamentally not being the case.



2009_706.pngForm, and Development Contributions 233

All policies require contributions for reserves, community infrastructure, and network infrastructure. An exception is Waitakere City, which funds reserves out of Financial Contributions under the RMA. Auckland City has a private supplier for water and wastewater supply (Metro Water Ltd) and hence does not provide these activities. Refer to Figure 10 for a summary of the community facilities funded by development contributions.


Figure 10: Summary of Facilities Funded by Development Contributions

All six policies base residential demand on a standardised residential household. The specific demand profile of this unit is not defined in all policies, but it is consistent with a typical detached dwelling. Households that generate more demand than the “average” (3 or more persons) enjoy a discount; households that generate less demand (2 or less persons) pay a “mark up”. Refer to Figure 11 for a summary of the unit of demand characteristics used within the policies.


Figure 11: Summary of Unit of Demand Characteristics



2009_742.pngNew Zealand Journal of Environmental Law

In respect of stormwater, Auckland City applies a standardised household equivalent, although it has an exception for multi-unit, multi-level buildings where the contribution required will only be the number of household equivalents on one level of the building. Christchurch City has a similar policy, requiring that in multi-unit developments where the total impervious area is equal to or less than the standardised average, the development in total will be charged 1.0 household unit irrespective of household units provided. The other policies make no allowance for multi-unit buildings, meaning that they may pay a potentially significant, disproportionate amount towards stormwater facilities relative to detached single units.

Overall, the demand characteristics of residential developments identified in section four of this article (particularly relating to household size and the differentiation of detached, medium-density, and high-density housing) is not considered to be reflected well in the policies examined. In particular, medium- and high-density units are clearly disadvantaged by the required contributions. Conversely, detached dwellings enjoy a subsidy in each of the policies due to the clear attribution of part of their demand to medium- and high-density units, and otherwise to units with households of 1–2 persons. In Christchurch City, this is particularly distorted given that family flats, only realistically possible in association with detached lower-density dwellings, are exempt from any development contribution at all, with the cost shortfall met by other new residential development (detached dwellings with no family flat, and medium- and high-density units).

All six policies are based on an explicit focus of equity. This equity is in each case argued in respect of the funding burden between new development and existing development, and in the context of justifying why development contributions from new development are sought at, overall, the greatest possible amounts. The policies take a consistent view on the Schedule 13(2) requirement of equity between new developments that equity is served by requiring all units to pay an equal contribution regardless of their location, type, or household size. This approach is not considered to deliver equity in demand attribution, but instead equality in demand attribution. These are not the same thing. The previously identified equity issue of whether those paying development contributions to cover their own capital costs should be exempt from historical community facility debt via ongoing rates was furthermore not identified in any of the policies examined despite their emphasis on equity.



2009_708.pngForm, and Development Contributions 235

Auckland City provides for partial remissions in respect of public space land acquisition. It also features a partial rebate for the incorporation of storm- water devices that reduce demand for this community facility. North Shore City provides for reductions in stormwater contributions on a similar basis. It otherwise allows for general remissions on the basis of a case-by-case application, as does Hamilton City and Wellington City.

Waitakere City uses a “Tool for Urban Sustainability” to manage remis- sions. This is an internet-based analysis that can be used to demonstrate sustainability principles and other practical efficiencies. It is, however, capped at a $2,000 maximum reduction in required development contribution per unit. Christchurch City provides for no remissions, although does feature a transitional period to phase in the full development contributions required by developments, with developments receiving discounts until 2010.

Overall, however, the remissions policies provided are not considered to have been designed to anticipate applications from all medium- and high- density developments on the basis that the suburban detached unit demand profile under which they are required to contribute is demonstrably inapplicable (especially in respect of stormwater requirements for multi-unit, multi-level buildings excluding Auckland and Christchurch Cities).

5.4 Reflection on Urban Sustainability

In the development contribution policies examined, all residential develop- ment has been (overall) fundamentally attributed an equal demand profile despite clear evidence, and indeed local acceptance, that this is not an accurate reflection of how urban settlements function. This includes the demand for community facilities by development depending on their type, location, and other characteristics. This raises clear questions of the integrity of s 101(3) LGA assessments and the extent to which Schedule 13(2) LGA is being achieved within the policies.

In consequence, the policies have the effect of providing a community facility subsidy to detached, suburban dwellings and large households; and a penalty for medium- and high-density units, and other households smaller than the standardised average size. While remissions are by and large available to help



2009_743.pngNew Zealand Journal of Environmental Law

balance some of these inequities, it is concluded that they are incapable of fully correcting instances of “overcharge”, and ultimately cannot address the fundamental issues of detached unit “undercharge” at all.

On that basis, the analysis of development contribution policies has identified that the principles and indicators of sustainable urban development identified in section two of this article are not well served by those policies. But of perhaps greater concern is that, given the consistency between the identified principles and indicators with local growth management policies, the development contribution policies seem clearly inconsistent with their own strategic local development directions.


6.1 Infrastructure Management a Key Part of a Sustainable Development Approach

The equitable funding of infrastructure has been identified as a necessary part of sustainable urban development. The inclusion of a tool allowing territorial authorities to require those generating demand for capital expenditure on community facilities to contribute towards that expenditure is therefore entirely appropriate within a statute that looks to allow a democratic, sustainable development approach to be taken in enabling well-being.

In particular, three fundamental roles for infrastructure were identified:

6.2 Sustainable Urban Development Well Established and Acknowledged Locally

In respect of the third role played by infrastructure, the concept of sustainable urban development is a proven spatial means to advance well-being in cities and developed areas. Sustainable urban development has been found to be broadly



2009_706.pngForm, and Development Contributions 237

based around how the built environment can contribute to ensuring available resources are directed towards:

Specific spatial indicators have been observed that give effect to these principles and in the context of residential development many are further supported by comprehensive and robust empirical evidence. Much of this evidence establishes a direct connection with the provision of infrastructure and in particular the way in which new development generates both a demand burden (including costs) and community benefits. This examination found that the type and location of residential development within an urban form, and household size, can markedly influence the costs and benefits (including infrastructure demand) available to both individuals and communities.

All six of the territorial authorities examined have or are in some process of acknowledging these indicators. In respect of residential development, in all six instances it was observed that the compact, dense, mixed, and walkable outcomes being strategically sought are markedly different to the low-density, detached dwelling-dominant patterns that have marked their development to the present. Adopting a unit of demand to measure new residential development modelled on the very “suburban” patterns (including community facility demands) the territorial authorities are looking to move away from may not be the most logical or effective means to assess the community facility demand of future development.

6.3 Development Contribution Policies Not Giving Effect to Urban Sustainability

The residential development component of six development contribution policies was examined to look at whether and the extent to which these matters had been reflected. In each it was observed that there seemed to be an overarching emphasis on maximum revenue generation, and the least possible capital cost burden falling on existing residents. There was little recognition found to support two other key infrastructure issues identified — namely, promoting cost internalisation into development decisions through price signals (considered a fundamental requisite to delivering equity between new developments), and promoting the most well-being supportive land use outcomes. Likewise, the policies were silent on the long-term community facility maintenance burdens (uncaptured by development contributions) which may result from development configurations arising in consequence of



2009_744.pngNew Zealand Journal of Environmental Law

developers looking to minimise capital costs to themselves in the short term. Critical characteristics observed were:

a) Despite s 101(3) LGA, all policies required the same approximate “funding mix” of development contributions to other revenue sources irrespective of the type or location of residential development, or the costs and benefits these may have on the overall community;

b) Despite Schedule 13 LGA, all policies failed (overall) to attribute demand between new residential developments on a consistent or equitable basis. In particular, a reliance on a standardised household unit matched to a suburban detached dwelling has been observed to be demonstrably inapplicable to medium- and high-density housing types;

c) All policies took an overall view (subject to some partial exclusions in the case of Auckland, North Shore, and Christchurch Cities) that all houses will result in an approximate demand for community facilities.

These characteristics are at odds with the urban sustainability principles accepted locally and which underpin each authority’s advocacy of particular urban patterns sought from the type and location of new development for network infrastructure. But of greater significance is the effect of the development contribution policies. Their common characteristics mean that in each case (with some partial exceptions), more-sustainable residential development choices, demonstrably connected to a lower demand for community facilities, are required to contribute an excessive proportion of costs for community facilities needed by new development in total. It is concluded that this amounts to a community facility subsidy required from more-sustainable development to benefit less-sustainable development. It also serves to mask the true cost of those less-sustainable decisions as well as creating a financial disincentive, or even a penalty, on more-sustainable ones. Although there will be many factors beyond a development contribution that will influence development decisions, such outcomes can only serve to contradict efforts by those territorial authorities to encourage urban sustainability.

6.4 Units of Demand and Types of Residential Development

Development contribution policies could look to use and attribute units of demand that are consistent with urban sustainability indicators, and are most likely to correspond to the actual demand generated by specific development types in specific locations. It is proposed that as a minimum the following dis- tinct types of residential development may be appropriate, each possibly having its own standardised demand profile and subject to clear location restrictions:



2009_708.pngForm, and Development Contributions 239

This would help ensure that the true demand of less-sustainable residential development choices was not being subsidised by more-sustainable choices. The correct alignment of price signals and equitable cost recovery that could result would ensure that development choices were made on the basis of accurately internalising the cost burdens underpinning them. It would also contribute to helping new residents make informed choices on the costs and benefits of different lifestyle choices when making their housing decisions.

On the basis of this research, the development contribution policies examined:

NZLII: Copyright Policy | Disclaimers | Privacy Policy | Feedback