New South Wales is undergoing a storm of activity in the regulation of its coastal environment. Stage 1 of the reforms has been completed, and the NSW Office of Environment and Heritage advised in late 2014 that Stage 2 of the reforms was to commence. In this article, we focus on two aspects of the reform agenda – namely, certificates issued under s149 of the Environmental Planning and Assessment Act 1979 (EPA Act) and the introduction of a new Coastal Management Act.

Current regulatory framework for coastal hazards

NSW's coastal environment is currently regulated by a complex framework of legislation, regulation and quasi legislative instruments, including:

• Local Government Act 1991 (LG Act): Section 8 of the LG Act sets out the council's charter which includes to exercise community leadership and to properly manage, develop, protect, restore, enhance and conserve the environment of the area for which it is responsible, in a manner that is consistent with and promotes the principles of ecologically sustainable development. Section 205 states that the council's local government area extends to the beach foreshore, being the area between the high watermark and the low watermark. Therefore, the council has an obligation in relation to foreshore erosion in its area, and other risks identified within the coastal zone.
• Coastal Protection Act 1979 (CP Act): Section 55B of the CP Act states that a council may, and if directed by the Minister must, prepare a coastal zone management plan. Section 55C sets out the matters to be dealt with in council's coastal zone management plan, including protecting and preserving beach environments, ensuring undiminished public access to beaches and emergency actions including works for the protection of property. The management plan must also be prepared in accordance with the Minister's guidelines which are contained in the NSW Coastline Management Manual dated September 1990. After a management plan comes into effect, a person must not carry out any work that has the effect of preventing or remediating beach erosion, or protect property affected by beach erosion, except in accordance with the management plan.
• Direction No 6 – Coastal Protection: Section 117 Direction: This Ministerial Direction requires council to implement the NSW Coastal Policy 1997 when making or amending Local Environment Plans (LEPs) that apply to land within a coastal zone.
• NSW Coastal Policy 1997: This policy provides overarching direction for council in its preparation and implementation of its coastal zone management plan, and in its assessment of development applications under the EPA Act. The NSW Coastal Policy 1997 sets out various strategic actions and assigns responsibility for the implementation of some of those actions to local councils. It requires that council prepare a coastal zone management plan which is consistent with the NSW Coastline Management Manual and which promotes ecologically sustainable development.
• SEPP 71 – Coastal Protection: SEPP 71 obliges council to reject development applications that diminish coastal access to foreshores (among other things), and to take into account, when considering development applications within the coastal zone, a number of considerations, including suitability of the development and the likely impact of coastal processes and coastal hazards on development and any likely impacts of development on coastal processes and coastal hazards.
• EPA Act: Section 79C of this Act requires council to consider the suitability of the site in assessing proposed development, which would include considering the risks of coastal hazards. Further, s79C requires council to consider the public interest which includes considering the principles of ecologically sustainable development, being an object to the EPA Act. The Courts have held that considering ecologically sustainable development includes assessing development against the physical effects of climate change, including the risk of coastal hazards¹. A further section regulating the management of coastal hazards is s149 of the EPA Act, which assists those applying for a s149 certificate to understand what policies affect the land by restricting development, as well as other relevant matters affecting the land.
• Environmental Planning and Assessment Regulation 2000: Regulation 92 requires council to take into consideration the provisions of the NSW Coastal Policy 1997 when determining development applications within a coastal zone.

The reform agenda appears to be geared towards streamlining the regulatory framework.

Changes to what is required in s149 certificates

One important way of managing the coastal hazards that have an impact on NSW properties is by councils informing land owners or prospective land owners of coastal hazards they have knowledge of as they relate to particular landholdings, as well as what restrictions on development apply to such landholdings due to the existence of a coastal hazard. This helps reduce development in the coastal zone where land associated with such development is clouded by a coastal hazard.

This can be achieved through s149 certificates. The category of relevant matters affecting land to be included on a s149 certificate is broad, and coastal erosion risks arguably falls into this category.

Although not technically a regulatory change, on 13 November 2014 as part of the Stage 1 reforms, the Department of Planning and Environment issued a Circular for councils providing guidance on notations to be included within s149 certificates in respect of coastal hazards – 'Coastal Hazard Notations on Section 149 Planning Certificates'. These certificates generally assist land owners and prospective land owners to understand what policies affect the land by restricting development and other relevant matters affecting the land.

Councils are often faced with a tension between two competing considerations, namely:

• not wanting to be alarmist in relation to providing too much information about coastal hazards, sometimes due to the impact on residents' insurance policies
• providing adequate information in relation to the extent of coastal hazard risks based on council's knowledge.

Sometimes there are groups of ratepayers who actively campaign against providing this information due to the impact on their land values and insurance premiums.

Despite the above, NSW case law requires councils to issue s149 certificates based on materials available to it (Mid Density Developments Pty Ltd v Rockdale Municipal Council [1993] FCA 408](Mid Density). In respect of coastal hazards, this includes information relating to coastal hazard risks identified by the council. In Mid Density, the council was held liable for providing misleading information in s149 certificates relating to flood risk.

Although there is a good faith defence found in s149(6) of the EPA Act and s733 of the Local Government Act 1993, in Mid Density it was held that a respondent cannot be said to be acting in good faith within the meaning of the Environmental Planning and Assessment Act and the Local Government (Flood Liable Land) Amendment Act, if it issues s149 certificates where no real attempt has been made to have recourse to the vital documentary information available to the council. In Mid Density, the court held that there must be a real attempt by the authority to answer the request for information at least by recourse to the materials available to the authority.

A council's discretion needs to be guided by the above case law in inserting material into the s149 certificates and when applying the new Circular relating to the issuance of s149 certificates.

The new Circular endeavours to assist councils understand the level of precision required when articulating the risks that may apply to a particular property. The Circular says that the wording in s149 certificates needs to distinguish between current exposure (where a study of coastal hazards formally adopted by council says the land is exposed to the hazard at the date the study was prepared) and future exposure (where land is identified in an adopted study as being exposed to the hazard at some point in the future) to coastal hazards. For example, if there is a policy applying to the parcel of land which has been adopted because of a coastal hazard, then the council needs to state that the policy is in response to either a current or future coastal hazard. Wording on the future hazards (e.g. sea level rise), also needs to specify what studies a council has drawn on to reach its conclusion, and the date of those studies. The circular provides some standard words to help councils implement the above.

In circumstances where the council is unable to clearly identify whether a hazard is current or exists in the future, the Circular also states that this should be clearly noted on the certificate.

In relation to other relevant matters affecting the land which should be set out in s149 certificates, this information includes information that a council is aware of regarding the existence and extent of a hazard but which the council has not developed a planning policy for or changed a planning instrument in respect of that hazard.

The Circular says two guiding principles should be used to evaluate whether information should be included:

• is the information sufficiently accurate, reliable and complete?
• assuming it is, then does the information warrant a constraint on development?

The application of these two principles will involve councils exercising some discretion. Even with the additional guidance the Circular provides, there is no formulaic answer to whether certain types of information need to be provided. The answer to this question needs to be considered on a case-by-case basis.

New Coastal Management Act

The Office of Environment and Heritage has advised that it will release a draft of the new Coastal Management Act in mid-2015 to replace the existing CP Act. The Coastal Protection Act is companion legislation to the EPA Act. The Government considers that the CPA Act is 'no longer fit for its purpose' and desires a new Act that is 'less complex, and better fits with land use planning and local government legislation'. The Department has advised that the new Act will include:

• modern statutory objectives articulating Government's vision for coastal management and which is more relevant to the regulatory framework for local government and land use planning
• obligations for state, regional and local land use planning instruments to give effect to the Act's statutory objectives
• requirements that councils undertake coastal zone management planning within the local government Integrated Planning and Reporting framework required under the LG Act. Accordingly, coastal management and planning will need to dovetail with a council's overall service delivery and asset management planning responsibilities included as part of the Integrated Planning and Reporting framework
• provisions for a new coastal management manual consolidating the existing guidelines and filling knowledge gaps identified by councils. This manual will also include planning requirements to be met by councils under the Integrated Planning and Reporting framework
• a new independent coastal advisory body which provides advice to the Minister on matters relevant to the operation of the Act.

Implications

The above measures provide a framework which acknowledges what was described by the NSW Chief Scientist in her report, namely 'The science behind climate change modelling and the projection of sea level rise is complex and evolving'. The above reforms will:

• provide greater transparency regarding prospective land owners (and others) understanding the extent of coastal hazards believed (on reliable information) by a council to affect land
• ensure that councils manage the NSW coastline with up-to-date information (assuming the objectives of the new Coastal Management Act are reflective of our knowledge of coastal hazards not being static).

There will need to be a skilling up of councils on these amendments to ensure implementation occurs uniformly across the relevant NSW coastal councils.

¹Walker v Minister for Planning & Ors [2007] NSWLEC 741; Minister for Planning v Walker & Ors [2008] NSWCA 224; Aldous v Greater Taree City council and Anor [2009] NSWLEC 17.