Fishermans Bend Ministerial Advisory Committee – supplementary advice to the Fishermans Bend Planning Panel – May 2018

  1. Introduction

The Fishermans Bend Ministerial Advisory Committee (MAC) presented to a Hearing convened by the Planning Panel considering Draft Amendment GC 81 on 1 March 2018.

The MAC was established in July 2015 to provide advice to the Minister for Planning on the work to ‘recast’ the planning for Fishermans Bend. The Committee includes experts on planning, transport,architecture and urban design, property development, social infrastructure, place making and public administration. It also includes three local community representatives with deep roots in the local community and with specific expertise in sustainability, heritage and manufacturing industry. The Lord Mayor of Melbourne (by delegate) and the Mayor of Port Phillip are also members of the Committee.

The presentation to the Planning Panel was based on the MAC’s Report to the Minister for Planning on the Draft Fishermans Bend Framework – October 2017 and that Report was based on over two years of intensive work andextensive consultation,conducted with the active participation of all members of the Committee.

At the Hearing, the Panel requested a range of supplementary advice arising from the MAC’s presentation. This report provides that advice.

At the same time, the MAC has kept abreast of the proceedings of the Panel and the huge volume of written evidence which has been presented to the Panel to assist its deliberations and is aware of the concerns which have been raised by some parties to the process.

Contention is, of course, by no means unusual in the planning process since city planning is always a balance of competing interests. And planning for Fishermans Bend was bound to be particularly fraught in the light of its unusual planning history. Given this, it is of considerable satisfaction to the MAC that, to date, no significant issue has been raised by submitters to the Panel which has not been previously considered by the MAC over the period of its work. The MAC has taken the opportunity of this Report to elaborate on its views on some of the issues which have been raised.

  1. Controls

2.1 Introduction

It is widely understood that Fishermans Bend is an area of unique potential and unique challenges. There are few cities of Melbourne’s size and level of development that have over 480 ha of developable land on the doorstep of the Central Business District. The Area is more than twice the size of the Hoddle Grid and its renewal is nationally significant.

It is less widely understoodthat the Area is unlike other large urban renewal areas in that it is not public land, it islargely privately owned by 320 different owners, four of the five precincts have been rezoned as Capital City Zone and those precincts have all been subject to significant land speculation.

Normal Victorian urban renewal strategies and adjustments to the normal Victorian planning rules will not deliver the Area’s latent potential for job growth and sustainable living.

Fishermans Bend requires a different and boldapproach.

As indicated in the Report to the Minister for Planning on Draft Fishermans Bend Framework – October 2017, the MAC supports the approach taken in the draft Framework and is confident that it provides a sound way forward for Fishermans Bend.

In particular, the MAC endorses the approach to land use planning which addresses widespread concern about density by linking population and employment targets with built form controls while at the same time encouraging commercial development. To be clear, the MAC supports Floor Area Ratio controls, the availability of additional residential Floor Area Uplift subject to the provision of highly desirable but tightly limited public benefits and a scheme which provides for preferred height controls.

The MAC recognises that it is difficult to write planning rules that cater for every circumstance, but the problem is that where discretion is allowed, the degree of departure from the policy can end up being large (as was the case in City of Melbourne for many years where ‘preferred’ setbacks were uniformly ignored).

On balance, therefore, the MAC supports mandatory controls of issues of critical importance to the public good, but has proposed limited flexibility where development viability is compromised by the controls. This is an unusual approach in Victoria but is made necessary by the unusual planning history of Fishermans Bend.

In addition, as the MAC has made clear in all of its work and the Government has acknowledged, strong planning controls are a necessary but not sufficient part of delivering on the agreed Vision for the Area. In particular, the MAC has stressed that a range of issues need early and ongoing attention. Foremost amongst these are the finalisation and implementation of the funding and financing plan,governance arrangements which integrate ongoing land use planning with industry ‘curation’ and provide strong leadership for the development of the Area, detailed precinct planning and early implementation of the tram route between the CBD and Lorimer and the Employment Precinct and across the Freeway into Sandridge, and active transport routes in and around the Area.

Ideally, these issues would have been resolved in advance of rezoning, but that is not an option available in Fishermans Bend.

2.2 Operation of Floor Area Ratio and Floor Area Uplift provisions

The MAC supports the intent of the Floor Area Ratio and Floor Area Uplift regime as outlined in the Framework (Framework p41) and the MAC Report (October 2017)

This includes:

  • Mandatory minimum non-residential (commercial) floor areas should apply in all core areas subject to development viability assessmentNB current provision allows unconstrained discretion in the provision of non-residential (commercial) floor area in core areas
  • Maximum Floor Area Ratio in core areas includes residential and non-residential (commercial) floor areas
  • Maximum Floor Area Ratioin non-core areas is residential only
  • Residential floor area uplift in excess of maximum residentialFloor Area Ratio can only be provided if specified public benefits are agreed to
  • All dwellings, including dwellings provided by floor area uplift, must be subject to developer contributions
  • Non-residential (commercial) floor area should be unlimited subject to height and overshadowing considerations (this provision is included in the draft amendment but revised in the Minister’s Part B submission to the Panel given its potential impact on sites required to allow for open space and roads. This issue is addressed below- section2.3)
  • Residential Floor Area Uplift should be allowed only when specified public benefitsare provided in accordance with specified ratios and this should not be subject to discretion by the Responsible Authority
  • The public benefits attracting residential uplift should deliver benefits which are not otherwise available ie social housing, open space in addition to that specified in the draft Framework and the bring forward costs of community infrastructure. The substantive costs of community infrastructure should be borne by developer contributions and State Budget allocations in the normal way
  • The public benefits attracting residential uplift and therefore increased population need to be tightly limited given the imperative to limit development to the numbers planned for.

Implementation

  • Provide for mandatory minimum non-residential (commercial) floor areas to apply in all core areas subject to the option of a development viability assessment by a Development Viability Assessment Panel(see below)
  • Clarify the operation of the mandatory Floor Area Ratio and Floor Area Uplift triggers in Clause 3.0 and 4.0 of the Capital City Zone. It would be clearer to separate the maximum floor area ratio into its two component parts (residential and non-residential -commercial)
  • Clarify that residential floor area is the threshold trigger for residential floor area uplift
  • Specify that non-residential (commercial) floor area can be provided without the need to provide additional public benefits
  • Specify the scope of floor area uplift benefits and the ratios of benefit to uplift in the Capital City Zone
  • Clarify the range of parties to the Section 173 agreements
  • Specify in policy that all dwellings, including dwellings provided by floor area uplift, are subject to developer contributions
  • Provide for the minimum requirement for non-residential (commercial) floor area in core areas to be reduced subject to strict specified conditions including open book assessment of the financial viability of the development (via Development Viability Assessment Panel - see below)

2.3 Operation of controls to deliver new roads, lanes and open space

It is common practice for roads and lanes to be required as a condition of development and the MAC supports the application of this practice in the Capital City Zone of Fishermans Bend. New roads and lanes should be constructed by the developer and transferred to the Council.

Flexibility may be required regarding the location of lanes on particular sites.

It is less common for open spacein excess of 52.01 contributions to be mandated as a condition of development as is the intention of the draft amendment.

It has always been the view of the MAC that where so much of the site is required for essential open space that viable development is not possible, that land should be subject to an immediate Public Acquisitions Overlay. Where a specific part of a site is essential (as for a station forecourt), the option should be available for the land to be publicly acquired (in which case the floor area available on the remaining site would, of course, be less) or for the developer to provide the site effectively in exchange for the full floor area of the gross area delivered on the remaining site.

In addition, all essential open space on sites where the proposed development is predominantly non-residential (commercial) should be acquired and paid for via the normal public acquisition processes. This proposal addresses the concern which led to the revision in the Minister’s Part B submission.

On sites where the open space is not essential for a specific location, flexibility should be allowed on how the open space is provided and the floor area should be calculated on the gross site area.

In all cases where the land is not acquired, open space must be remediated to public open space standard and transferred to Council. In these circumstances, any remediation costs incurred to bring the open space to a higher standard than the rest of the site should be offset against developer contribution obligations.

The public costs involved in these arrangements which are additional to the costs involved in the proposal in the draft amendment should be borne by all developers in Fishermans Bend by increasing the 52.01 contributions in the area.

This is a direct consequence of the unusual planning history of the area. The alternative of inadequate open space is an unacceptable urban outcome.

Implementation

  • Amend Maps to show all new 12 metre roads and remove all new laneway locations except where essential for access and other key urban design considerations
  • Include policy guidance on the location and nature of laneways
  • Include a permit condition in Capital City Zone Clause 4.0 that new roads and lanes must be constructed and vested in Council
  • Apply a public acquisitions overlay to sites where so much of the site is required for essential open space that viable development is not possible
  • Where essential open space must be provided in a particular location on a site, provide for an option for land to be publicly acquired and paid for (in which case the floor area available on the remaining site would be less) or for the developer to provide the site effectively in exchange for the full floor area of the gross area, delivered on the remaining site
  • Specify that all essential open space on sites where the proposed development is predominantly non-residential (commercial) should be acquired and paid forby normal public acquisition processes
  • On sites where the open space is not essential for a specific location, provide for flexibility on how the open space is provided and for the permitted floor area to be calculated on the gross site area.
  • Provide that in all cases where the land is not acquired, open space must be remediated to public open space standard and transferred to Council and for the remediation costs incurred to bring the open space to a higher standard than the rest of the site be offset against developer contribution obligations.
  • Increase the 52.01 contributions to offset the additional cost of the arrangements outlined above.

2.4 Setbacks

As indicated in its October 2017 Report, the MAC generally supports the mandatory setbacks outlined in the draft Amendment noting that’the proposed setback strategies are intended to provide for a greater diversity of building types than the existing setback provisions contained within the Planning Scheme which are predicated on the 'podium and tower' building type. As well as a greater diversity of design, the proposed strategies will facilitate the mix of residential and employment/commercial uses.’

In its presentation to the Panel, the MAC reiterated the importance of ‘flexibility in these provisions in the context of master planned areas confirmed by a Development Plan Overlay (see below).’

Implementation

  • Provide for the capacity for flexibility in the requirement for mandatory setbacks in the context of master planned areas confirmed by a Development Plan Overlay (see below).

2.5 Affordable Housing

The issue of affordable housing in Fishermans Bend has been the subject of much attention in submissions to the Panel and considerable confusion.

It has also been an issue of ongoing concern for the MAC.

The draft Framework defines affordable housing as housing which is appropriate to very low, low and moderate income households to either rent or buy. This is the same definition as in Plan Melbourne. That is, affordable housing is housing for the lowest three quintiles in household incomes or 60% of Melbourne’s households.

Social housing is a small subset of affordable housing which is made available to mostly very low income households which meet specific criteria.

The draft Framework proposes a target of 6% affordable housing to be achieved by a range of ‘mechanisms’. These ‘mechanisms’ are not specified, but include market forces and all of the initiatives included in Commonwealth and State affordable housing strategies direct subsidy, building on government land, build to rent, incentives to community housing providers, aged care, disability housing etc.

A further ‘mechanism’ is the inclusion of social housing as a public benefit able to achieve Floor Area Uplift. The Framework and the draft amendment provide that this public benefit social housing is to be transferred free of charge to a community housing provider in return for Floor Area Uplift at the rate of 1 social housing unit for 8 additional private dwellings of the same size.

The MAC supports all of these provisions, but is of the view that a 6% affordable housing target as defined is far too low. This is a question of policy intent in relation to the projected investment in State and Federal funded infrastructure such as transport, schools, universities and regional parks and is a question of implementation effort to achieve the outcomes sought by the Vision.

Based on the projected investment by all taxpayers and the Vision endorsed by the Victorian Government, the MAC has suggested that it is reasonable to seek to ensure that at least 4000 of the 40,000 dwellings to be built in Fishermans Bend are affordable to more than the top 40% of household incomes. The MAC target of 10% is considered reasonable, but others have suggestedstronger policy intent and implementation effort to drive higher levels of social mix. This is not a technical issue; it is a question of policy.

The MAC’s other recommendation in relation to social housing provided in exchange for Floor Area Uplift is that it should be the same size and quality as the market dwellings in the development and that it should be allowedto be delivered off site but within the same precinct as the uplift is provided and in a location with the same walkability index via a voluntary provision via a s173 agreement.

The MAC has noted that some submissions to the Panel have suggested that the Floor Area Uplift provisions should be deleted from the draft Amendment and the Framework and replaced by ‘inclusionary zoning’. Like other issues related to ‘affordable housing’ the devil is in the detail of inclusionary zoning. Some ‘inclusionary zoning’ schemes refer only to Government land, some are aspirational, some allow building very small dwellings to keep the costs of purchase down. Some allow consideration of development viability to reduce the mandate. The most recent Victorian example (Hobsons BayAmendment C88) provides for 5% of dwellings to be provided to a community housing provider for 75% of the ‘market’ value.