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The Biodiversity Offsets Scheme (The Scheme) is designed to avoid, minimise and offset impacts on biodiversity from development and land clearing and to ensure land that is used to offset impacts is secured in-perpetuity.
The Scheme involves a biodiversity assessment that determines the impact a development will have on biodiversity. The Scheme introduces a set of processes to be followed when carrying out development and land clearing activity. This activity may result in fees being incurred by the Developer or Landholder approximate to the level of impact on biodiversity.
Following an extensive review into land management and biodiversity in NSW, a new land management framework has been established. This came into effect on 25 August 2017.
For developers and landholders, there are two key elements to the Scheme:
Most relevant to developers is Part A of the Scheme. Madison Marcus summarise the steps involved in Part A as follows:
Environment NSW outlines where the Scheme will apply, namely:
*The Biodiversity Offsets Scheme Threshold (Part 7 Regulation) is determined by two elements:
If the land clearing exceeds the trigger, the Scheme applies.
Development proposals that DO NOT exceed the Threshold
The developer or landholder must carry out a test of significance for all development proposals that do not exceed the Threshold. A test of significance will determine the impact of environmental clearing. The guidelines for this current test are not yet available.
Where the impact is significant, the developer or landholder must carry out a Biodiversity Assessment Method (BAM) in relation to identified impacts. Details on the BAM are contained in Step 2 below.
Those below the Threshold and test of significance will be assessed under s79C Environmental Planning and Assessment Act 1979.
If the Scheme does not apply to the activity then an Accredited Assessor must be engaged.
The Assessor will complete a Biodiversity Assessment Report (BAR) which must form part of the development application, which a consent authority will have regard to.
The BAR sets out how the developer or landholder has applied steps to avoid and minimise impacts on biodiversity, and sets out the number and type of ecosystems and species credits required to offset residual impacts of the activity on biodiversity (‘credit obligation’).
A consent authority must consider whether the proposal may have a ‘serious and irreversible impact’ and will reject an application if it is deemed likely.
The impact is regarded as serious and irreversible if it ‘is likely to contribute significantly to the risk of a threatened species or ecological community becoming extinct.’ (clause 6.7(2)). More information on the guideline principles and criteria for determining this impact can be found here.
If the consent authority approves the application, a credit obligation (and other actions required) is determined and will be included as conditions of the relevant approval or consent.
The consent authority has the discretion to vary the credit obligation generated by the BAR and other conditions may also be imposed to secure commitments in the BAR.
Once the consent authority has issued the approval or consent that includes the final credit obligation, developers and landholders have two primary ways that they can satisfy this obligation:
Biodiversity Regulations Part 6 Division 6.1
The Calculator is used to determine the price payable by developers and landholders through either: (Clause 6.2(2))
For more information on the calculator, click here.
When the developer or landholder has completed these steps for all credits they are required to retire, they can proceed with their activity in accordance with the approval. The Biodiversity Conservation Trust is responsible for the credit obligation for applying Fund money towards securing biodiversity offsets. (Clause 6.6)
Areas of exception for 12 months: Camden, Campbelltown, Fairfield, Hawkesbury, Liverpool, Penrith and Wollondilly. Development applications are permitted to be made under the former scheme for the next 3 months.
Fees associated with the Biodiversity Offset Scheme:
Environment NSW has provided a fees table for relevant transactions in the Biodiversity Offsets Scheme process. The table of fees can be viewed here.
If you have any questions relating to the Biodiversity Offsets Scheme or anything contained in this article, please contact the authors Denis Hall, Director – Real Estate & Developments or Paul Jayne, Partner – Planning, Environment & Government on:
Denis Hall, Director – Real Estate & Developments
+61 2 9762 0424
Paul Jayne, Partner – Planning, Environment & Government
+61 2 9762 0483
Madison Marcus Law Firm produced this article. It is intended to provide general information in summary form on legal topics, current at the time of first publication. The contents do not constitute legal advice and should not be relied upon as such. Formal legal advice should be sought in particular matters.