Agenda of Extraordinary Council

Extraordinary Council 14 September 2021

Item 3.1

3.1. 2020.81 Allied Natural Wood Exports Pty Ltd - Timber Optimisation Hub

Director Community Environment and Planning

Applicant	Allied Natural Wood Exports Pty Ltd (ANWE)
Owner	South East Fibre Exports Pty Ltd (SEFE)
Site	Lot 16 DP 1066187, Edrom Road, Edrom
Zone	IN1 General Industrial
Site area	47.9 hectares
Proposed development	Construction and operation of a log sorter, sawmill, pallet plant, briquette plant and repurposing of the existing water treatment thickener tank

Officer’s Recommendation

1. That Council determines that the proposed development does not constitute designated development having consideration to Part 2, Schedule 3 of the Environmental Planning & Assessment Regulation 2000 as the proposed alteration to the approved development will not significantly increase the environmental impacts of the total development.

2. That Council approve Development Application 2020.81 for construction and operation of a log sorter, sawmill, pallet plant, briquette plant and repurposing of the existing water treatment thickener tank at Lot 16 DP 1066187, Edrom Road, Edrom subject to the conditions provided in Attachment 14.

3. That those parties who made a submission be notified of Council’s decision.

4. That in the event that additional building approval services by Council officers are required to rectify the extent of works approved that are directly related to Development Application 2020.81, these services are provided pro bono.

Executive Summary

Development Application (DA) 2020.81 is being reported to Council for determination. The development comprises the construction and operation of a log sorter, sawmill, pallet plant, briquette plant and repurposing of the existing water treatment thickener tank.

The proposed development is recommended for approval, subject to the conditions of consent provided in Attachment 14.

A detailed assessment of the proposal (Attachment 1) was undertaken by the Department of Planning, Industry and Environment (DPIE) on behalf of Bega Valley Shire Council (BVSC), as part of the collegial support provided to BVSC after the Black Summer Bushfires in 2020.

DPIE’s assessment of the development application has fully considered all relevant matters under Section 4.15 of the Environmental Planning and Assessment Act 1979 (EP&A Act), the objects of the EP&A Act and the principles of ecologically sustainable development.

A range of detailed conditions to address any residual impacts associated with the construction and operation of the development have been recommended, should the development application be approved. These conditions were informed by the recommendations of the relevant public authorities and the issues raised during the public exhibition period.

On balance, it is considered that approval of the development would be in the public interest, subject to conditions.

Background

DA 2020.81 was submitted to Council on 23 March 2020 seeking development consent for the construction and operation of a log sorter, sawmill, pallet plant, briquette plant and repurposing of the existing water treatment thickener tank.

The application was publicly advertised and notified to adjoining landowners. External referral and approval agencies were also consulted.

General Terms of Approval (Attachment 15) were issued by the NSW Environment Protection Authority (EPA) on 3 July 2020 pursuant to Section 4.46 of the EP&A Act.

On 4 September 2020 determination of the application was made under staff delegation and a Notice of Determination was issued on 14 September 2020.

On 4 December 2020 a Class 4 Judicial Review appeal was lodged in the NSW Land and Environment Court of NSW by South East Forest Rescue Inc (LEC Case Number 20/346528) against Council’s determination of the application.

On 24 August 2021, Judge Robson of the Land and Environment Court of NSW ruled under Section 4.16 of the EP&A Act that the development consent dated 4 September 2020 for DA 2020.81 in relation to land at Lot 16 DP 1066187 at Edrom Road, Edrom is invalid, void and of no force and effect.

The effect of this ruling means that DA 2020.81 has not been lawfully determined and the application is now presented to Council for determination.

Description of proposed development

The Applicant proposes the construction of a new log sorter, sawmill, pallet plant and briquette plant, and the repurposing of the existing water treatment thickener tank to store stormwater.

The development does not seek to alter the timber processing capacity of the site, and timber harvesting does not form part of this development application.

The Applicant advises that the development, the subject of this application, is confined to the use of timber already harvested, some of which is to be repurposed to the two identified new uses, namely pallets and briquettes.

The development is not considered State significant development, as it does not have a capital investment value (CIV) greater than $30 million in accordance with Schedule 2, Clause 4 of State Environmental Planning Policy (State and Regional Development) 2011. Consequently, BVSC is the consent authority for the development application.

Development plans and supporting documentation submitted with the development application, including additional information provided throughout the assessment, is provided as Attachments 2-13 of this report.

Planning Assessment

The proposal has been assessed in accordance with the matters for consideration under Section 4.15 of the EP&A Act as detailed in the Assessment Report (Attachment 1) undertaken by DPIE on behalf of BVSC, as part of the collegial support provided to BVSC after the Black Summer Bushfires in 2020.

In evaluating the development proposal, the consent authority is required to turn its mind to the Matters for Consideration specified by Section 4.15 of the EP&A Act 1979.

Those matters are:

(a) the provisions of—

(i) any environmental planning instrument, and

(ii) any proposed instrument that is or has been the subject of public consultation under this Act and that has been notified to the consent authority (unless the Planning Secretary has notified the consent authority that the making of the proposed instrument has been deferred indefinitely or has not been approved), and

(iii) any development control plan, and

(iiia) any planning agreement that has been entered into under section 7.4, or any draft planning agreement that a developer has offered to enter into under section 7.4, and

(iv) the regulations (to the extent that they prescribe matters for the purposes of this paragraph),

(v) (Repealed)

that apply to the land to which the development application relates,

(b) the likely impacts of that development, including environmental impacts on both the natural and built environments, and social and economic impacts in the locality,

(c) the suitability of the site for the development,

(d) any submissions made in accordance with this Act or the regulations,

(e) the public interest.

The Assessment Report (Attachment 1) assesses and details those matters for Council’s consideration.

Assessment Matters

In its assessment of the proposal, DPIE has considered the Statement of Environmental Effects (SEE), the issues raised in the submissions, the Applicant’s response to submissions and the additional information provided in its assessment of the development.

The key assessment issues relate to:

· Air quality

· Traffic impacts

Other issues are considered and detailed in Section 6.3 of the Assessment Report (Attachment 1) include:

· Noise and vibration

· Visual impacts

· Vegetation clearing

· Construction soil and water

· Social and economic impacts

· Greenhouse gas emissions

· Construction waste

Bega Valley Local Environmental Plan 2013

The development has been assessed in accordance with Bega Valley Local Environmental Plan 2013 (BVLEP 2013). The land is zoned IN1 General industrial (see Figure 1).

The land use is characterised as a Rural industry, which is permissible with consent in the IN1 General Industry zone.

rural industry means the handling, treating, production, processing, storage or packing of animal or plant agricultural products for commercial purposes, and includes any of the following—

(a) agricultural produce industries,

(b) livestock processing industries,

(c) composting facilities and works (including the production of mushroom substrate),

(d) sawmill or log processing works,

(e) stock and sale yards,

(f) the regular servicing or repairing of plant or equipment used for the purposes of a rural enterprise.

Note—Rural industries are not a type of industry

sawmill or log processing works means a building or place used for handling, cutting, chipping, pulping or otherwise processing logs, baulks, branches or stumps, principally derived from surrounding districts, into timber or other products derived from wood.

General Industry is also permissible in the zone.

general Industry means a building or place (other than a heavy industry or light industry) that is used to carry out an industrial activity.

industrial activity means the manufacturing, production, assembling, altering, formulating, repairing, renovating, ornamenting, finishing, cleaning, washing, dismantling, transforming, processing, recycling, adapting or servicing of, or the research and development of, any goods, substances, food, products or articles for commercial purposes, and includes any storage or transportation associated with any such activity.

The development is not considered to be Heavy Industry (which would be prohibited in the IN1 zone) as the proposal would not have a significant adverse impact in the locality or on existing or likely future development on other land in the locality and would not pose a significant risk in the locality to human health, life or property or to the biophysical environment, particularly given the control measures identified as part of the EPL and the proposed conditions of consent.

heavy industry means a building or place used to carry out an industrial activity that requires separation from other development because of the nature of the processes involved, or the materials used, stored or produced, and includes—

(a) hazardous industry, or

(b) offensive industry.

It may also involve the use of a hazardous storage establishment or offensive storage establishment.

The objectives of the IN1 General Industry zone are:

· To provide a wide range of industrial and warehouse land uses.

· To encourage employment opportunities.

· To minimise any adverse effect of industry on other land uses.

· To support and protect industrial land for industrial uses.

· To allow a range of support services that do not have an adverse impact on the viability of business and commercial zones.

The proposed development is considered to be consistent with the objectives of the zone.

Map

Description automatically generated

Figure 1: Land use zoning as per Bega Valley Local Environmental Plan 2013

Alterations and additions to development not designated development

Schedule 3 of the Environmental Planning and Assessment Regulation 2000 (EP&A Regulation) specifies certain development types to be ‘designated development’. Designated development refers to developments that are high-impact developments (e.g., likely to generate pollution) or are located in or near an environmentally sensitive area (e.g., a wetland). If a development application is categorised as designated development, the application must be accompanied by an environmental impact statement (EIS).

Clause 33 of Part 1 in Schedule 3 of the EP&A Regulation specifies certain wood or timber milling or processing works to be designated development, as follows:

“33 Wood or timber milling or processing works

Wood or timber milling or processing works (being works, other than joineries, builders supply yards or home improvement centres) that saw, machine, mill, chip, pulp or compress timber or wood--

(a) that have an intended processing capacity of more than 6,000 cubic metres of timber per year and--

(i) are located within 500 metres of a dwelling not associated with the milling works, or

(ii) are located within 40 metres of a natural waterbody or wetland, or

(iii) burn waste (other than as a source of fuel), or

(b) that have an intended processing capacity of more than 50,000 cubic metres of timber per year.”

Clause 35 of Part 2 of Schedule 3 of the EP&A Regulation specifies that development involving alterations or additions to development (whether existing or approved) is not designated development if, in the opinion of the consent authority, the alterations or additions do not significantly increase the environmental impacts of the total development (that is the development together with the additions or alterations) compared with the existing or approved development.

Clause 36 of Part 2, Schedule 3 of the EP&A Regulation provides the factors to be taken into consideration when a consent authority forms the opinion that the alterations and additions are not designated development. Those factors are listed below:

36 Factors to be taken into consideration

In forming its opinion as to whether or not development is designated development, a consent authority is to consider—

(a) the impact of the existing development having regard to factors including—

(i) previous environmental management performance, including compliance with the conditions of any consents, licences, leases or authorisations by a public authority and compliance with any relevant codes of practice, and

(ii) rehabilitation or restoration of any disturbed land, and

(iii) the number and nature of all past changes and their cumulative effects, and

(b) the likely impact of the proposed alterations or additions having regard to factors including—

(i) the scale, character or nature of the proposal in relation to the development, and

(ii) the existing vegetation, air, noise and water quality, scenic character and special features of the land on which the development is or is to be carried out and the surrounding locality, and

(iii) the degree to which the potential environmental impacts can be predicted with adequate certainty, and

(iv) the capacity of the receiving environment to accommodate changes in environmental impacts, and

(c) any proposals—

(i) to mitigate the environmental impacts and manage any residual risk, and

(ii) to facilitate compliance with relevant standards, codes of practice or guidelines published by the Department or other public authorities.

To determine whether the development application for the construction and operation a new log sorter, sawmill, pallet plant and briquette plant at the Eden Chip Mill site can be considered as non-designated development under Schedule 3, Part 2 of the EP&A Regulation, the following assessment has been conducted to assist Council in its decision making.

Background

In the late 1960s, Harris-Daishowa (Australia) Pty Ltd was issued a Special Licence (Licence No.L78005) by the then Forestry Commission of NSW for the establishment of a wood chip mill at Edrom Road, Eden in the Bega Valley Shire (see Figure 1). The site has been subject to a number of development consents over the past 50 years, which have largely related to the installation of new or upgraded equipment or the establishment of new stockpiles. It is noted that the burner and the pellet plant have been decommissioned in more recent years.

Issue

Schedule 3, Part 1 Clause 33 of the EP&A Regulation, details that Wood or timber milling or processing works over a specified production threshold can be designated development. The Timber Optimisation Hub would have a processing capacity of more than 50,000 m³ of timber each year, which requires an assessment of whether it meets the merit-based threshold for designated development (see Table 1).

The Applicant has requested that BVSC consider the proposed Timber Optimisation Hub as non‑designated development under Part 2, Schedule 3 of the EP&A Regulation.

Part 2, Schedule 3 Consideration

Under Part 2, Schedule 3 of the EP&A Regulation, a development involving alterations or additions (whether existing or approved) can be considered as non-designated development, if in the opinion of the consent authority, the alterations or additions do not significantly increase the environmental impacts of the total development, compared with the existing or approved development.

The proposal by the Applicant is considered to be ‘additions’ to an approved development as the proposal involves the installation of new processing equipment and structures, and as such can be considered under Part 2, Schedule 3 of the EP&A Regulation.

Lot 16 (the subject site for this development) is 47.9 hectares (ha); however, the owner also owns the adjoining land bringing the total land holding of industrial zoned land close to 100ha, located at Jews Head, Edrom Road, Edrom in the Bega Valley Shire. The site is legally described as Lot 16 in DP 1066187, and is located approximately 3.4 kilometres (km) to the south-east of Eden (Figure 2). The site is owned by South East Fibre Exports Pty Ltd and is operated by the Applicant.

The site has been developed to support the operation of the wood chip mill and comprises wood chip stockpiles, processing and administration buildings, water treatment facilities and log storage areas. The wood chip mill currently processes up to 650,000 tonnes of timber per annum and is regulated by the EPA under an Environment Protection Licence (EPL).

· Current on-site activities include:

· Processing of hardwood and softwood roundwood logs into wood chips

· Log and chip storage

· Log and wood chip delivery to the adjacent wharf for water transport

· Sandblasting, painting and other maintenance requirements

· Water storage and stormwater treatment.

Figure 2 – Location of the site with respect to Eden township

There are a number of specific matters that are prescribed under the EP&A Regulation to be considered by a consent authority when determining if a development can be considered non‑designated development under Part 2, Schedule 3 of the EP&A Regulation.

The Applicant has provided a SEE (Attachment 3) containing their assessment of the development against Part 2, Schedule 3 of the EP&A Regulation and an assessment of the potential impacts. The consideration of the proposal against these matters is provided in Table 1.

Table 1 - Matters to be considered in determining whether a development is designated

Factors to be taken into consideration	Evaluation	Conclusion
(a) the impact of the existing development having regard to factors including:
(i) previous environmental management performance, including compliance with the conditions of any consents, licences, leases or authorisations by a public authority and compliance with any relevant codes of practice, and	There have been three recorded non‑compliances with EPL 1482: 2001 – Three Dryer Outlet tests were missed due to faulty testing equipment 2004 – Exceedance of the site’s water discharge limit 2005 – Accidental discharge of high pH water from the site. No non-compliances have been recorded in relation to the exceedance of emissions limits, and no non-compliances have been recorded since 2005. Two audits have been undertaken for the site. In the 2012 audit, the EPA found that monitoring data could not be found on the licensee’s website. By 11 February 2013, this had been rectified and the audit was accepted by the EPA. A second audit to assess the level of compliance with the Pollution Incident Response Management Plan was undertaken between January and March 2013 and the site was found to be in compliance.	Staff are satisfied with the overall environmental performance of the existing development and notes the subject development application would include additional monitoring and emission control measures.
(ii) rehabilitation or restoration of any disturbed land, and	The development would only involve minor earthworks to provide a level area for the installation of new equipment and sheds, and would be located in a previously disturbed section of the site.	Staff are satisfied the development would not adversely impact upon the rehabilitation or restoration of disturbed land.
(iii) the number and nature of all past changes and their cumulative effects, and	The site has been subject to a number of development consents over the past 50 years, which have largely related to the installation of new or upgraded equipment or the establishment of new stockpiles. The total volume of timber processed at the site peaked in 2008 at 1.2 million tonnes of logs per annum. When the development is fully operational, the total volume of timber processed at the site is expected to remain at current levels (650,000 tonnes per annum).	Staff are satisfied the cumulative effects of changes to the existing wood chip mill are minor.
(b) the likely impact of the proposed alterations or additions having regard to factors including:
(i) the scale, character or nature of the proposal in relation to the development, and	The development’s footprint is minor (approximately 3.5 hectares (ha)) in the context of the existing wood chip mill (40 ha) and the overall site (100 ha). In addition, the development does not seek to alter the timber processing capacity of the site, and timber harvesting does not form part of this development application. The development would improve the operational efficiency of the existing wood chip mill and allow for the creation of new, higher-value wood products from sawlogs and existing on-site waste streams (sawdust).	Staff are satisfied that the scale, character and nature of the proposal will not significantly change the existing wood chip mill.
(ii) the existing vegetation, air, noise and water quality, scenic character and special features of the land on which the development is or is to be carried out and the surrounding locality, and	The Applicant has provided an assessment of the potential environmental impacts associated with the development, including air, traffic and noise impacts. The assessment notes particulate emissions from the proposed briquette plant would be managed through the installation of a plenum pulse filter system and ongoing monitoring under the development’s EPL. Construction traffic would peak at 29.9 light vehicles and 1.3 heavy vehicles per day during the busiest construction periods, and would be managed through the implementation of a Construction Traffic Management Plan. Total truck movements associated with the operation of the development would remain unchanged when compared to existing operations at the wood chip mill. The assessment notes the development would comply with the relevant construction and operational noise trigger levels. In addition, the development would be centrally located within the existing wood chip mill, and would be separated from surrounding coastal areas, Twofold Bay and the historic Edrom Lodge.	Staff are satisfied that the environmental impacts of the proposal will not be significant.
(iii) the degree to which the potential environmental impacts can be predicted with adequate certainty, and	An assessment of the proposal has been provided which considers potential air quality, traffic and noise impacts associated with the operation of the new plant equipment. Council notes the level of impacts resulting from the proposal would be relatively minor and that any residual impacts would be appropriately managed through the existing EPL and any recommended conditions of consent. Therefore, the air quality, traffic and noise impacts resulting from the proposal are considered to be predicted with adequate certainty.	Staff are satisfied that all relevant issues have been predicted and, where necessary, addressed.
(iv) the capacity of the receiving environment to accommodate changes in environmental impacts, and	The proposal would be located within the centre of the existing wood chip mill and would require minimal clearing of remnant vegetation for the establishment of Asset Protection Zones (APZs). The receiving environment is considered to have the capacity to accommodate the changes in environmental impacts generated by the new processing equipment.	Staff are satisfied that the potential environmental impacts to the surrounding environment are minimal.
(c) any proposals:
(i) to mitigate the environmental impacts and manage any residual risk, and	There would be a variety of plans managing construction impacts (including traffic, noise and water). The management of any operational impacts would be guided by the monitoring outlined in any development consent granted for the proposal.	Staff are satisfied that the environmental impacts of the development will be adequately mitigated.
(ii) to facilitate compliance with relevant standards, codes of practice or guidelines published by the Department or other public authorities.	The Applicant is required to continue compliance with the existing EPL and to collaborate with the EPA. Furthermore, the SEE indicates the proposal would maintain compliance with a variety of standards including, but not limited to: Managing Urban Stormwater; Soils and Construction Vol 1 (‘the blue book’) (Landcom, 2004) Guidelines for Developments Adjoining Land Managed by the Office of Environment and Heritage (OEH, 2013) the Interim Construction Noise Guidelines.	Staff are satisfied that the Applicant will continue to ensure compliance with the site’s existing EPL (as modified), relevant standards and any existing and proposed conditions of consent.

The analysis concludes that the construction and operation of the Timber Optimisation Hub will not significantly increase the risk and environmental impacts of the total development, including the environment compared to the existing development.

Furthermore, the assessment provided by the Applicant demonstrates any potential impacts will be below the relevant environmental criteria and adequately managed through a series of new management plans and the development’s EPL.

As the proposal would be centrally located within the existing wood chip mill and does not seek to increase the volume of timber processed at the site each year, the environmental impacts of the Timber Optimisation Hub are not expected to be significant.

For the reasons outlined above, the proposed development falls within Part 2, Schedule 3 of the EP&A Regulation and does not constitute designated development.

It is recommended that Council form the opinion that the proposed alteration to the approved development will not significantly increase the environmental impacts of the total development and therefore is not designated development.

Options

Council has the option to:

1. Approve the application as per the staff recommendation and in accordance with the conditions of consent identified in Attachment 14.

2. Defer determination of the application and request a separate report from staff to the next practicable meeting providing Council with an amended set of conditions. Councillors would need to identify the conditions to be modified and the grounds for amending the conditions.

3. Defer determination of the application and request a separate report from staff to the next practicable meeting advising Council of matters under Section 4.15 of the EP&A Act, if any, that would enable consideration to be given by Council to the refusal of the proposal under DA 2020.81, including reasons for refusal in the event that Council ultimately determines to refuse the Application.

Community and Stakeholder Engagement

Engagement undertaken

After accepting the development application and the SEE, BVSC:

· Made the documentation publicly available from 9 April 2020 until 13 May 2020 (35 days) on Council’s website

· Notified landowners/occupiers in the vicinity of the site about the exhibition period by letter

· Notified and invited comment from relevant public authorities and electricity providers

· Advertised the exhibition period in the Eden Magnet newspaper

A total of 165 submissions were received on the development during the exhibition period, including:

· Two from public authorities

· One from the relevant electricity provider

· Six from special interest groups

· One from a member of the Legislative Council

· 155 from the public

Of the 165 submissions received, 160 objected to the development, one was in support and four provided comments or requests for clarification.

The Applicant’s response to submissions is provided as Attachment 12. A summary of the issues raised in submissions is considered in the Assessment Report (Attachment 1). A full copy of submissions received during the public exhibition period has been provided to all Councillors through the Councillor portal for review and consideration in the determination of this matter.

Since the Court determination, South East Forest Rescue submitted to BVSC an addendum to their original submission, received via email 24 August 2021. A full copy of that submission has been provided to Councillors, via the Councillor portal, for consideration in the determination of this matter.

It is considered that there are no new relevant matters raised in that submission.

Engagement planned

Post determination, submitters and the Applicant will be advised of Council’s decision.

Financial and Resource Considerations

Assessing proposals for development is part of the regular business of BVSC and resourcing to undertake that function is included in BVSC’s adopted 2021-22 Budget.

Legal /Policy

Should Council resolve to refuse the Application, the applicant has the normal appeal rights to the Land and Environment Court under the provisions of the EP&A Act.

Impacts on Strategic/Operational/Asset Management Plan/Risk

Strategic Alignment

The development, subject to compliance with the conditions identified in the proposed consent, is considered to be consistent with the following goals of the Bega Valley Shire Community Strategic Plan 2040:

Goal 3: Our economy is prosperous, diverse and supported by innovative and creative businesses

Goal 5: Our air and water is pristine and our natural environment and rural landscapes are protected

Goal 6: We are leaders in sustainable living and support innovative approaches to resource recovery and the production of renewable energy and food

Environment and Climate Change

An assessment of environmental impact is detailed in the Assessment Report provided as Attachment 1, including consideration of the principles of Ecologically Sustainable Development, greenhouse gas emissions and climate change.

The potential environmental impacts of the development have been assessed and, where potential impacts have been identified, mitigation measures and environmental safeguards have been recommended.

Concern has been raised in public submissions that the broader environmental impacts of the proposal, including the environmental impacts of harvesting public native forests in the Eden region for the purpose of supplying timber to the development need to be addressed.

The proposed development, the subject of this development application, does not include harvesting timber from forests and the development does not seek to alter the timber processing capacity of the site, and timber harvesting does not form part of this development application.

In addition, it is noted that logging activities are regulated separately under the Forestry Act 2012 and its associated regulations.

Under Part 5B of the Forestry Act 2012, forestry operations in State forests or other Crown-timber lands must obtain an integrated forestry operations approval granted by both the Minister for the Environment and the Minister for Lands and Forestry.

As part of this process, operators must demonstrate that forestry operations will be carried out in accordance with the principles of ecologically sustainable forest management, including the application of the precautionary principle to prevent environmental harm.

The likely impacts associated with the Timber Optimisation Hub are detailed in the Assessment Report (Attachment 1). It is concluded that all environmental impacts can be appropriately managed and mitigated through the commitments made by the Applicant and the recommended conditions of consent.

The Section 4.15 Assessment detailed in the Assessment Report (Attachment 1) considers the relevant matters for consideration, including the likely impacts of the proposed development, including environmental impacts on both the natural and built environments, and social and economic impacts in the locality.

The development has assessed the likely impacts on the locality.

Economic

The economic impacts are addressed in the Assessment Report (see Attachment 1).

Risk

Assessment of this development application does not introduce new risks to BVSC. Development impacts, and the risks associated with the use in terms of environmental impact, have been considered as detailed in this report and its attachments.

Social / Cultural

There are no identified impacts to cultural heritage associated with the proposed development as detailed in the attached Assessment Report and as described in the Applicant’s Aboriginal Due Diligence Assessment (Attachment 5).

A range of social impacts have been considered in the assessment of this application, including concerns raised in submissions, which have been considered and detailed in the Assessment Report (Attachment 1).

Attachments

1 ⇩. Assessment Report prepared by DPIE

2 ⇩. Development Plans

3 ⇩. Statement of Environmental Effects (SEE)

4 ⇩. Biodiversity Assessment Attachment (Appendices F & G of SEE)

5 ⇩. Aboriginal Due Diligence Assessment

6 ⇩. Noise Assessment Report

7 ⇩. Supplementary Noise Assessment Report

8 ⇩. Air Assessment Report

9 ⇩. Supplementary Air Assessment Report

10 ⇩. Water Cycle Assessment and Management Report

11 ⇩. Applicant's Response to Request for Information dated 29 May 2020

12 ⇩. Applicant's response to public submissions received during exhibition period

13 ⇩. Pre-construction Air Assessment

14 ⇩. Proposed Conditions of Consent

15 ⇩. General Terms of Approval from NSW EPA

Extraordinary Council 14 September 2021

Item 4.1

4.1. Operation and management of the Bega Saleyards

Council approval is sought to offer Sapphire Horizons Pty Limited further tenure of five-years with an option for a further five-years for their continued occupation and management of Bega Saleyards.

Director Assets and Operations

Officer’s Recommendation

1. That Council approve a further five-year lease with an option for a further five-years to Sapphire Horizons Pty Limited for their continued occupation and management of Bega Saleyards for an annual rental of $16,300 plus GST per annum increased annually by CPI.

2. That Council authorise the Chief Executive Officer and Mayor to execute the necessary lease documentation to provide further tenure.

Executive Summary

Council officers recently carried out an open and transparent Expression of Interest (EOI) process for the operation and management of the Bega Saleyards. This report details the results of the negotiations with all applicants following the resolution of Council on 4 August 2021 and seeks Council’s approval to enter into a further long-term tenure arrangement with Sapphire Horizons Pty Limited.

Background

Council resolved at its Ordinary Meeting of 4 August 2021, when considering the results of the EOI 2021-104 process carried out for the operation and management of the Bega Saleyards as follows:

1. That Council receive and note this report and Confidential Report attached.

2. That Council note the Expression of Interest process for the operation and management of the Bega Saleyards has now closed.

3. That Council consider the Council officers’ recommendation as detailed in the attached Confidential Report.

4. That Council receive all three submissions for the Expression of Interest (EOI) regarding the operation and management of the Bega Saleyards and note the suitability of each submission.

5. That Council accepts the EOI submission from Peter Muirhead on behalf of Bega Beef Co-op as detailed in the EOI submission.

6. That Council authorises the Chief Executive Officer and Mayor to execute lease documentation with Peter Muirhead on behalf of Bega Beef Co-op for a period of five (5) years as the successful candidate.

7. That Council authorises the Chief Executive Officer and Mayor to execute lease documentation with the second applicant being RJ & JA Grant Pty Ltd for a period of five (5) years should the successful applicant decline the terms and conditions of the lease agreement.

8. That Council authorises the CEO and Mayor to execute lease documentation with the third applicant being Sapphire Horizons for a period of five (5) years should the successful applicant or second preferred applicant decline the terms and conditions of the lease agreement.

9. Until the lease agreement is entered with the preferred applicant, Council approve Sapphire Horizons Pty Limited to continue as monthly tenants of Bega Saleyards.

10. That Council authorise the Chief Executive Officer and Mayor to enter into negotiations in order to execute the necessary lease documentation to provide tenure to the successful applicant.

Following the resolution of Council, officers progressed negotiations with the successful applicant Bega Beef Co-op. Following extensive negotiations Council received formal notification from Bega Beef Co-op on Monday, 30 August 2021 advising they did not accept Council’s conditions in relation to lease responsibilities. Following receipt of this advice officers progressed negotiations with the second applicant being RJ & JA Grant Pty Ltd who advised they were declining Council’s offer to take over the use, operation and management of Bega Saleyards.

Negotiations with the third applicant being Sapphire Horizons Pty Limited have commenced and officers have received a request from Sapphire Horizons Pty Limited for Council to consider offering longer term tenure in line with their EOI submission. As the lessee is responsible for all ongoing maintenance of the Saleyards facility Sapphire Horizons Pty Limited have advised they would need longer term tenure to allow for a financial return on capital improvements that will be required such as fencing of the facility.

Options

The options available to Council are:

1. Accept the recommendation provided by Council officers and resolve accordingly.

2. Advise Sapphire Horizons Pty Limited the maximum tenure available for the use, operation and management of Bega Saleyards is five (5) years at this time. Noting Sapphire Horizons Pty Limited may withdraw their acceptance to continue with the operation and management of Bega Saleyards which could leave Council in the position of running a further EOI process or managing the Saleyards in house which it is not currently resourced or equipped to do.

3. Other options, as raised and resolved by Councillors.

Community and Stakeholder Engagement

Engagement undertaken

Since the Council resolution on 4 August 2021, officers have been liaising with all applicants who submitted EOI submissions regarding the future use, operation and management of the Bega Saleyards.

Legal representatives have been engaged to prepare the necessary lease documentation to formalise the future occupation and management of the Saleyards facility with the successful applicant.

Engagement planned

Council officers will continue to liaise with Sapphire Horizons Pty Limited and legal representatives to formalise tenure of the Saleyards facility.

Financial and Resource Considerations

As outlined in the report from Council’s Ordinary Meeting of 4 August 2021, a Request for Quotation (RFQ) process to engage Walsh and Monaghan Valuers to provide a market rental assessment was commissioned by Council which indicates a starting rental figure in the order of $16,300 plus GST per annum, to be increased annually by CPI (All Groups –Sydney). In accordance with Council’s Management of Leases and Licences Procedure, an updated market rental valuation will be commissioned every five (5) years to determine the appropriate rental for the following five (5) year term.

Council officer time has been required to conduct negotiations following the EOI process and further resources will be required to manage the lease agreement during its term.

Legal /Policy

Section 53 of the Real Property Act 1900 (NSW) (RP Act) provides that land leased for more than three (3) years must be in the approved form and Section 42(1)(d) of the RP Act and the Registrar-General’s Guidelines, requires a lease for a term exceeding three (3) years to be registered on title.

Impacts on Strategic/Operational/Asset Management Plan/Risk

Strategic Alignment

Sapphire Horizons Pty Limited will be responsible for all ongoing structural and reactive maintenance for the Saleyards facility during the term of the lease.

Environment and Climate Change

There are no environment and climate change matters associated with the proposed lease to Sapphire Horizons Pty Limited.

Economic

The Bega Saleyards is in the top 20 cattle throughput saleyards in NSW (2017-18) and is a vital infrastructure facility that enables transparent transaction of livestock on behalf of livestock producers in the South East NSW and to several buyers and sellers in Victoria. The saleyards play a vital role to the agribusiness industry by enabling transparent price discovery, presenting significant lines of stock in a central location and enabling smaller lots to be combined into larger lots for transport efficiency.

Risk

There are no adverse risks in allowing the Saleyards to be occupied by Sapphire Horizons Pty Limited if the use is authorised by way of a formal lease which contains appropriate indemnity and insurance clauses.

Social / Cultural

The development of Bega Saleyards, which is intended to formalise the existing land uses and allow Council to continue to lease the proposed lots for industrial purposes is in the interest of the community as it supports maintaining employment opportunities in the Bega Valley Shire.

Attachments

1 . Walsh and Monaghan valuation report for Bega Saleyards (Confidential - As this attachment contains information that would, if disclosed, confer a commercial advantage on a person with whom the Council is conducting (or proposes to conduct) business as per Section 10A(2)(c) of the Local Government Act 1993.

Although the above relates more explicitly to the discussion of closed business, it also forms part of the basis of justification as to why information relied upon in informing the public decisions made by Council are kept confidential. To consider this confidential material in open Council would be, on balance, contrary to the public interest (as defined in Section 14 of Government Information Public Access (GIPA) Act 2009) as it would potentially disclose private business information provided by tenderers in a confidential tender process and would also impact Council’s position in relation to its consideration, therefore impacting the tender process. This meets the requirements of Sect 10 D of the Local Government Act 1993 if Council were to close the meeting to discuss the details of individual tenderers.

Contact	Phone	Email	Website
Bega Valley Shire Council	(02) 6499 2222	council@begavalley.nsw.gov.au	www.begavalley.nsw.gov.au
ICAC	8281 5999 Toll Free 1800 463 909	icac@icac.nsw.gov.au	www.icac.nsw.gov.au
Office of Local Government	(02) 4428 4100	olg@olg.nsw.gov.au	http://www.olg.nsw.gov.au/
NSW Ombudsman	(02) 8286 1000 Toll Free 1800 451 524	nswombo@ombo.nsw.gov.au	www.ombo.nsw.gov.au

Item no & subject
Pecuniary Interest	In my opinion, my interest is pecuniary and I am therefore required to take the action specified in section 451(2) of the Local Government Act 1993 and or any other action required by the Chief Executive Officer.
Significant Non-pecuniary conflict of interest	– In my opinion, my interest is non-pecuniary but significant. I am unable to remove the source of conflict. I am therefore required to treat the interest as if it were pecuniary and take the action specified in section 451(2) of the Local Government Act 1993.
Non-pecuniary conflict of interest	In my opinion, my interest is non-pecuniary and less than significant. I therefore make this declaration as I am required to do pursuant to clause 5.11 of Council’s Code of Conduct. However, I intend to continue to be involved with the matter.
Nature of interest	Be specific and include information such as : · The names of any person or organization with which you have a relationship · The nature of your relationship with the person or organization · The reason(s) why you consider the situation may (or may be perceived to) give rise to a conflict between your personal interests and your public duty as a Councillor.
If Pecuniary	Leave chamber
If Non-pecuniary (tick one)	Disclose & vote Disclose & not vote Leave chamber
Reason for action proposed	Clause 5.11 of Council’s Code of Conduct provides that if you determine that a non-pecuniary conflict of interest is less than significant and does not require further action, you must provide an explanation of why you consider that conflict does not require further action in the circumstances
Print Name	I disclose the above interest and acknowledge that I will take appropriate action as I have indicated above.
Signed

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 1*	Assessment Report prepared by DPIE

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 2*	Development Plans

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 3*	Statement of Environmental Effects (SEE)

Extraordinary

Meeting Notice and Agenda

To:

Copy:

Live Streaming of Council Meetings

Publishing of Agendas And Minutes

Ethical Decision Making and Conflicts of Interest

A guiding checklist for Councillors, officers and community committees

Ethical decision making

Conflict of interest

The test for conflict of interest

Identifying problems

Local Government Act 1993 and Model Code of Conduct

Agency advice

Disclosure of pecuniary interests / non-pecuniary interests

Agenda

1 Apologies and requests for leave of absence

2 Declarations

3 Staff Reports – Planning and Environment

4 Staff Reports – Infrastructure Waste and Water

Extraordinary Council

14 September 2021

Staff Reports –Planning And Environment

14 September 2021

Officer’s Recommendation

Attachments

Extraordinary Council

14 September 2021

Staff Reports – Infrastructure Waste And Water

14 September 2021

4.1. Operation and management of the Bega Saleyards

Officer’s Recommendation

Attachments

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 4*	Biodiversity Assessment Attachment (Appendices F & G of SEE)

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 5*	Aboriginal Due Diligence Assessment

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 6*	Noise Assessment Report

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 7*	Supplementary Noise Assessment Report

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 8*	Air Assessment Report

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 9*	Supplementary Air Assessment Report

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 10*	Water Cycle Assessment and Management Report

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 11*	Applicant's Response to Request for Information dated 29 May 2020

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 12*	Applicant's response to public submissions received during exhibition period

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 13*	Pre-construction Air Assessment

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 14*	Proposed Conditions of Consent

Extraordinary Council	14 September 2021
*Item 3.1 - Attachment 15*	General Terms of Approval from NSW EPA