Legal Insights

NSW Crown land reforms have commenced – what do local councils need to know?

By Libby Walker

• 17 July 2018 • 6 min read
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The majority of the Crown Land Management Act 2016 (NSW) (the Act) commenced on 1 July 2018. The Act significantly reforms the use and management of Crown land in NSW. This article provides an overview of the key reforms, focusing on those most relevant to local councils.

The Act consolidates eight pieces of legislation into one Act, repealing the Crown Lands Act 1989, the Crown Lands (Continued Tenures) Act 1989, the Western Lands Act 1901 and certain other legislation. Any existing lease, licence or permit issued under previous legislation will continue for its agreed term. From 1 July 2018, all new leases, licences and permits will be issued under the new legislation.

The key reforms relevant to councils include:

Management of Crown land by councils – the former structure of reserves, reserve trusts and reserve trusts managers has been replaced with a single manager responsible for each Crown reserve, known as the Crown land manager. For councils, council reserve trust managers are appointed as Crown land managers for land they previously managed. The existing reserve trust provisions remain in place until 1 July 2019 to give councils time to make changes to their operations (such as banking, tax and insurance arrangements).

Councils will now manage Crown land as if it were public land under the Local Government Act 1993 (NSW), subject to some Ministerial oversight. For example, council Crown land managers cannot sell or re-categorise managed Crown land without Ministerial consent.

Landowner consent – under the new Act, the Minister will be taken to have given land owner’s consent to a development application made by a Crown land manager or the holder of a lease or licence on the Crown land for certain low impact acts on dedicated or reserved land. This includes development applications for:

  • minor repairs, maintenance and renovations on existing buildings
  • the use of the land for a purpose for which the land can be used under the Act or a lease or licence under the Act.

This removes the need to go to the Minister for consent in these circumstances, as is usually required for a development application under the Environmental Planning and Assessment Act 1979.

Community engagement strategy – the Act requires persons responsible for dealings affecting Crown land to comply with a ‘Community Engagement Strategy’ published by the Minister. This strategy includes engagement requirements for the preparation of plans of management, changes to reservation and the sale, lease, vesting and licencing of Crown land. These requirements go beyond simple notification obligations under the repealed legislation.

Plans of management – council Crown land managers are required to ensure that a compliant ‘plan of management’ is adopted for all Crown land they manage as community land within three years. The NSW Government have allocated $7million in funding to support councils prepare plans of management for Crown land.

Native title managers – council Crown land managers are now required to engage a ‘native title manager’ to oversee and approve dealings and actions that may affect native title. Native title managers must have training or qualifications that have been approved by the Minister.

Council Crown land managers must obtain the written advice of at least one native title manager where it grants certain interests in the land, including leases, licences, easements, mortgages, covenants and other restrictions on use.

This requirement does not apply to ‘excluded land’, which includes:

  • land subject to a determination under the Native Title Act 1993 (Cth) that native title rights and interests have been extinguished or do not exist
  • land where the native title rights and interests have been compulsorily acquired
  • land for which a ‘native title certificate’ is in effect.

A native title certificate can be issued by the Minister for Lands where there is adequate evidence to show that native title rights and interest for the land have been extinguished or do not exist. The issue of a native title certificate does not affect rights under the Native Title Act 1993 (Cth).

Native title compensation responsibilities – Councils will now be responsible for making certain native title compensation payments for Crown land for which it is a Crown land manager or any former Crown land that is vested in it through the land negotiation program (discussed below). This applies to compensation payable under s 24JAA (public housing), 24KA (facilities for services to the public), 24MD (acts that pass the freehold test) or 24NA (acts affecting offshore places) of the Native Title Act 1993 (Cth). The State remains liable for all other compensation payments under the Native Title Act 1993 (Cth).

It is also worth noting that there is now a requirement for a council Crown land manager to obtain the Minister for Land’s consent to compulsorily acquire native title rights and interests.

Land negotiation program – the Act provides for land that meets specified criteria to be transferred for local ownership to councils by voluntary negotiation. This aspect of the Act commenced in 2016 and the NSW Government has been offering negotiations to local government areas on a staged basis.

Land can be vested under these provisions where:

  • the Council agrees (where land is transferred in these circumstances the Council will take on the liabilities associated with the land so the Council needs to be comfortable with this in the circumstances)
  • if the land is subject to a claim under the Aboriginal Land Rights Act 1983 (NSW), the claimant land council has consented
  • the land is located wholly within the local government area
  • the Minister is satisfied, after taking into account criteria prescribed in the regulations, that the land is ‘suitable for local use’.

Once the land is vested, the Council obtains a freehold interest over the land, subject to native title interests and any reservations and exceptions listed in the land. The land is taken to have been acquired by the Council as ‘community land’ under the Local Government Act 1993 (NSW) (or in specific circumstances can be taken to be ‘operational land’ under the Local Government Act 1993 (NSW)). The Council will be entitled to all income generated from the land.

Changes to leases and licences – the Act provides a formula for calculating minimum rent for holdings granted under the Act and introduces a framework for rent determinations and re-determination (with the exception to Western land leases which will continue to be determined by a set formula). Licence provisions have also been reviewed and updated. The Act also allows the Minister to issue licences unilaterally where Crown land is being used without permission but that use would be permissible if an application for a licence had been lodged.

If you are interested in finding out more about the Crown land reforms and how you can manage these changes, please contact us.

Need to know more about the Crown land reforms in NSW?

Contact the Planning & Environment team.

By Libby Walker

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