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A Guide to Designations under the Resource Management Act 1991

Acknowledgements

Introduction

Section 1: Frequently Asked Questions

Section 2: 'Step-by-Step' Guides

Section 3: Detailed Guidance

Appendix A: Form 17

Appendix B: Form 18

Appendix C: Form 19

Appendix D: Form 20

Appendix E: Form 21

Appendix F: Form 23

Section 3: Detailed Guidance

3.1 Detail on designations

Historical use of designations

Historically, designations served two purposes.

Firstly, they enabled central and local government to get planning authorisation for public works.

For central government, these included works in the fields of education (schools, polytechnics and universities); defence (army bases, airfields and ammunition depots); law and order and emergency services (prisons, police and fire stations, court houses and periodic detention centres); energy (power stations, dams and high voltage power lines); transportation (state highways, rail corridors and airports); and communications (post offices, telephone exchanges and radio transmitters/receivers).

For local government, works were usually for utility services, such as water services and sewerage schemes. However, local authorities also often designated their own roads and other assets, including gravel quarries, cemeteries and domains.

Secondly, designations protected land for a given future activity. It was quite common to see proposed designations for activities such as 'proposed intermediate school', 'proposed motorway', and 'proposed telephone exchange'. Proposed designations prevented any incompatible land use on the land until the work was ready to start, and often provided a basis for acquiring land. Acquisition was compulsory when the work was deemed to be an 'essential work'.

Most of these works were proposed during the 1970s, at the time of district scheme reviews. Some of the proposed designations were fulfilled, but many were either scaled back in size (such as reduced motorways or township bypasses) or were eventually withdrawn completely (such as schools).

'Proposed designations' serve little purpose beyond land acquisition and putting the public on notice of the future use of the land. This is because usually a new requirement/designation is necessary for the actual school, motorway or telephone exchange (to use the previous examples). There are few examples of designations for 'proposed works' under the RMA.

The move to state-owned corporations and eventually privatisation in the 1980s and 1990s resulted in fewer new designations and fewer proposed designations. Under the RMA, most works are established on designated sites within defined timeframes.

Advantages of designations

Designations are useful for providing for activities that might otherwise be difficult to comprehensively provide for in a district plan. A designation is often suitable for such activities, because of their scale, effects, or spatial coverage. Designations can be used to:

• assist activities that occur in multiple zones or across several districts, such as high-voltage power lines
• reduce land use uncertainties for large capital works projects, such as hydro dams and prisons
• provide certainty and continuity for network style projects, such as telecommunications, schools and police stations
• protect land from incompatible uses when it is not within the requiring authority's control.

A designation, and the notice of requirement that precedes it, also:

• gives the public notice of the proposed public work
• is usually more open ended and flexible than a resource consent
• allows some details to be left to the outline plan stage.

There is often a difficulty in using the resource consent process for large-scale activities. The tests of 104(D) relating to resource consent assessment for non-complying activities (which many designated activities would be) would not always be satisfied by many larger works and projects. This is because the environmental effects of the activity may be more than minor, and the work or project may be contrary to the objectives and policies of the district plan. Designations provide for these works and projects, and network utility operations, by recognising that they:

• are often essential services
• are often limited to specific sites
• may have more than minor effects and may not be provided for by plan policies.

Although a plan change could also authorise the project or work, it would need to be a publicly notified process, with no guarantee of the outcome for the requiring authority. It could also be a much more lengthy process, and more at risk of subsequent change.

Designation use under the RMA

Designations continue to have two main purposes, both enacted in section 176.

Firstly, a designation gives the requiring authority rights to undertake activities on land it has designated. These rights essentially give primacy to the designation over the rules of the district plan, or proposed district plan, so long as the work is in accordance with the designation.

Note that the rights attributed to earlier designations and heritage orders take priority (section 177), and the requiring authority is only exempted from the restrictions on land (section 9(1)). The designation process does not avoid the restrictions on regional land use activities, or on the use of air, water, river beds and the coastal marine area, in sections 9(3) and 12-15.

Secondly, a designation 'protects' the designated land in favour of the requiring authority. Any person who wishes to do anything on designated land that may prevent or hinder the designated work must first obtain written consent from the requiring authority. The inclusion of designations into the district plan 'protects' the designated land, as it is a form of explicit public notification of the requiring authority's interest in the land.

Section 176, as amended by the Resource Management Amendment Act 2003, states in full:

Section 176. Effect of designation -

(1) If a designation is included in a district plan, then

(a) section 9(1) does not apply to a public work or project or work undertaken by a requiring authority under the designation; and

(b) no person may, without the prior written consent of that requiring authority, do anything in relation to the land that is subject to the designation that would prevent or hinder a public work or project or work to which the designation relates, including -

(i) undertaking any use of the land described in section 9(4); and

(ii) subdividing the land; and

(iii) changing the character, intensity, or scale of the use of the land -

(2) The provisions of a district plan or proposed district plan shall apply in relation to any land that is subject to a designation only to the extent that the land is used for a purpose other than the designated purpose.

(3) This section is subject to section 177.

Because of these changes, some of the earlier case law may be of diminished relevance. The change in wording of subsection (1) from "The requiring authority responsible for the designation may do anything that is in accordance with the designation" to the narrower "Section 9(1) does not apply to work undertaken by a requiring authority under the designation", when read in conjunction with the changes to sections 17, [The general duty to avoid, remedy or mitigate adverse effects on the environment now applies to activities carried out pursuant to designations.] 319 [Section 319 has been amended to make it explicitly clear that enforcement orders can be made against persons who are acting in accordance with designations, in some circumstances.] and 325, [Section 325 has been amended to make it explicitly clear that the Environment Court can confirm abatement notices against persons who are acting in accordance with designations, in some circumstances.] all relating to environmental responsibility and enforcement, reduce the 'carte blanche' nature of a designation.

The RMA also provides a basis for non-governmental agencies to use the designations procedure for works which, although no longer provided by a government agency, still fulfil the public works and services role. Perhaps the best example of this is the communications sector. The former New Zealand Post Office now has three constituent arms: postal, banking and telecommunications. Telecommunications is now delivered by a range of private sector providers, all with the ability to become network utility operators.

Designated land is often within the control of the requiring authority. It is less common under the RMA for designations to be used to assist acquisition of land, since ownership or rights of access are often obtained first.

The scope of a designation

Operative district plans record a designation in the relevant planning maps, and in a full description of the designated purpose. This description, often called the 'designation notation' or the 'designated purpose', defines the scope of the designation, and what activities the requiring authority may undertake in accordance with section 176(1)(a).

The scope of a designation is a critical determinant of the nature of the activity and associated works that can be established on a designated site. The scope of a designation may be restricted or controlled by detailed descriptions and conditions, including mitigation measures.

Case law

The meaning to be attributed to the wording of 'designation', 'designation notation', and 'designated purpose', has been the subject of several cases.

Waimairi County Council v Hogan ([1978] 2 NZLR 587, Court of Appeal) asked: "What then is the meaning to be given to that designation? It is of the essence of district plans that they provide notice to the world of the use to which the land in the district may be put. ... The question then is, what is the plain ordinary meaning of the words used in the plan in designating the use of this [designated] land? What would an ordinary, reasonable member of the public, examining the plan, have taken from the designation?"

In Ngataringa Bay 2000 Inc v Minister of Defence ((3) (1992) 2 NZRMA 318, Planning Tribunal), the designation was simply for 'defence purposes'. The Tribunal used the same test, stating that a "designation is to be defined by what an ordinary reasonable member of the public, examining the plan, would have taken from the designation". The Tribunal also decided that an explanatory statement to the designation was not a part of the designation, and did not restrict the buildings and facilities that could be undertaken.

In Olsen v Minister of Social Welfare (W32/95, Planning Tribunal), regarding the Epuni Boys' Home in Lower Hutt, the Tribunal stated that "The legislation requires the authority responsible for the designation and/or requirement to use words which indicate to the average member of the public the nature of the activity upon site". The Tribunal concluded that the description 'boys' home' was seen as misleading and intended to 'pacify' the public.

Based upon the preceding case law synopsis, in deciding if a proposed works are within the scope of a designation, the territorial authority should take into account the designation notation or where there is one, the full description of the designated works. It should also take into account any conditions that could limit the designation, and assess whether a member of the public could get a reasonable idea of the proposed activity or work from the description in the district plan. Designations inserted into plans under the RMA often include very detailed descriptions and conditions, similar to resource consents.

The territorial authority also needs to consider matters such as 'who is the proposed work for?'to ensure the purpose of the designation is not compromised. Questions of funding are not necessarily helpful. For example, a hall on a school site may be funded by the community, and be used by the community at times, as well as the school. A relevant question is: 'who retains responsibility for the hall?' If it is a community group, rather than the school, the hall should be subject to all normal rules in the district plan rather than the school designation.

3.2 Detail on requiring authorities

Definition

Section 166 defines who can be a requiring authority:

... 'Requiring authority' means -

(a) A Minister of the Crown; or

(b) A local authority; or

(c) A network utility operator approved as a requiring authority under section 167.

By definition, all Ministers of the Crown and all local authorities, including territorial, regional and unitary authorities, are automatically requiring authorities. A 'network utility operator' wishing to become a requiring authority must apply to the Minister for the Environment, under section 167.

Section 166 states that a 'network utility operator' means a person who -

(a) undertakes or proposes to undertake the distribution or transmission by pipeline of natural or manufactured gas, petroleum, or geothermal energy; or

(b) operates or proposes to operate a network for the purpose of -

(i) telecommunication [as defined in section 5 of the Telecommunications Act 2001]; or

(ii) radiocommunication [as defined in section 2(1) of the Radiocommunications Act 1989]; or

(c) is an electricity operator or electricity distributor as defined in section 2 of the Electricity Act 1992 for the purpose of line function services as defined in that section; or

(d) undertakes or proposes to undertake the distribution of water for supply (including irrigation); or

(e) undertakes or proposes to undertake a drainage or sewerage system; or

(f) constructs, operates, or proposes to operate, a road or railway line; or

(g) is an airport authority as defined by the Airport Authorities Act 1966 for the purposes of operating an airport as defined by that Act; or

(h) is a provider of any approach control service within the meaning of the Civil Aviation Act 1990; or

(i) undertakes or proposes to undertake a project or work prescribed as a network utility operation for the purposes of this definition by regulations made under this Act, -

and the words 'network utility operation' have a corresponding meaning.

Becoming a requiring authority

Section 167 of the RMA sets out the procedure for a network utility operator to become a requiring authority. Approval of a requiring authority is at the discretion of the Minister for the Environment, and can include the terms and conditions the Minister considers appropriate (section 167(3)).

The network utility operator applies to the Minister for the Environment, using Form 17 or similar.

The Minister may make further inquiries and request any further information (section 167(2)). Approval is by way of a notice in the Gazette. The Minister usually decides on the application approximately two months after receipt of the application.

Subsection (4) includes two fundamental tests that the Minister for the Environment must be satisfied with to issue a notice in the Gazette. The tests are:

(a) The approval of the applicant as a requiring authority is appropriate for the purposes of carrying on the project, work, or network utility operation; and

(b) The applicant is likely to satisfactorily carry out all the responsibilities (including financial responsibilities) of a requiring authority under this Act and will give proper regard to the interests of those affected and to the interests of the environment.

It is the network utility operator's responsibility to convince the Minister that requiring authority status is 'appropriate' and that they are likely to satisfactorily carry out all the responsibilities.

The Ministry for the Environment, along with several legal publishers, maintains lists of all approved requiring authorities. These are included in annotated versions of the Act.

Transitional provisions and 'deemed' requiring authorities

Section 420 of the RMA is of fundamental importance for designations included in transitional district plans. It is a 'savings provision', meaning that it temporarily maintains certain rights or responsibilities from the Town and Country Planning Act 1977. However, the existence of section 420 is often unrecognised.

The key subsections are (2) and (5).

Subsection (2) means that designations that were included in a district scheme at the time of the commencement of the RMA automatically continue as designations in transitional district plans, and "the person responsible for the designation shall be deemed to be a requiring authority for that designation; ...". This means that persons or organisations that were responsible for a designation, but do not fit the section 166 criteria to become a requiring authority, are deemed to be requiring authorities for the life of the designations(s) in question.

For example, the multitude of 'port' designations included in transitional district plans continue to have effect, and the 'harbour boards' or their successors (port companies) are requiring authorities, but only for the purpose of that designation.

Subsection (5) defines when the deemed designation and deemed requiring authority status end. It provides that the deemed designation remains in force until the plan is made operative, and then lapses unless the deemed requiring authority has been approved as a requiring authority under section 167.

Case law

Section 420(5) is not entirely clear about which 'plan' it refers to, and has been the subject of Environment Court, and High Court decisions. The High Court decision of Port Otago Limited v Hall ([1997] NZRMA 1993, AP 184/96, High Court) has clarified that deemed designations, and deemed requiring authority status, exist until a proposed district plan becomes operative. At the date of becoming operative, these designations lapse. The crux of the Port Otago decision is: "... we are satisfied that Port Otago Ltd is entitled to rely upon the designation originally forming part of the [District Scheme] until there is a plan [In the decision, it is made clear that the 'plan' referred to is a plan that has been through the proposed plan process under the RMA, and does not refer to a 'review' of a transitional district plan made operative after the RMA was enacted, or a 'deemed' district plan under section 373.] made operative under the Act relating to the area when the designation will lapse in accordance with s 420(5) unless Port Otago Ltd has been approved as a requiring authority in respect of the project or work under s 167 of the Act".

A deemed requiring authority has all rights and obligations under the RMA, except the ability to lodge notices of requirement. It can only lodge a new notice of requirement if it obtains actual requiring authority status under section 167. A deemed requiring authority can, however, lodge an outline plan for the deemed designation.

Note that amended section 19 applies to designations, meaning that transitional district plans and the designations in them could be rendered inoperative before a proposed district plan is fully operative.

3.3 Managing operative designations

Third party work on designated land

Section 176(1)(b) requires that any person doing work on a designated site that may prevent or hinder a designation must obtain the written consent of the requiring authority. This applies whether the activity that the other person wishes to undertake requires resource consent or not.

The wording of section 176(1)(b) makes clear that the request for written consent and the granting of written consent is strictly between the requiring authority and the person who wishes to undertake the works. It is not a matter that territorial authorities need to concern themselves with.

However, when a third party applies for a resource consent for an activity on designated land, a territorial authority will usually consider the requiring authority to be an adversely affected party for the purpose of sections 94 and 94B. The consent of the requiring authority and the approval of a potentially affected party are two separate issues.

The requiring authority is not automatically an adversely affected party. The territorial authority must assess whether the requiring authority is affected by the proposal in a manner different from the public generally. A difficulty arises when an applicant considers that the work they are intending to do won't prevent or hinder the public work, and therefore does not need written approval from the requiring authority.

Two or more designations on a site

Section 177 sets out the procedure to be followed if there is more than one designation on a given site, or if there is both a designation and a heritage order on the site. This commonly occurs where there are designations covering a wide area, such as for water catchments, with smaller designated areas within them, such as a State highway. This double-up can also occur when designations for activities cross, such as railways and State highways. In these cases, the general rule of 'first in, first served' applies.

Essentially, the later requiring authority must obtain the written approval of the earlier requiring authority to do anything in accordance with the later designation. The earlier requiring authority can only withhold its consent if the work that is authorised by the later designation would prevent or hinder the earlier designated works. The first requiring authority is not under the same obligation to the later requiring authority.

Appeals against a refusal of requiring authority approval

Section 179 sets out the rights and considerations for an appeal to the Environment Court against a requiring authority who has refused written consent to a third party or a later requiring authority under sections 176(1)(b), 177(2), or 178(1). Section 179 allows the person who has been refused consent 15 workings days to lodge an appeal with the Environment Court. The matters that the Environment Court is to consider in determining an appeal are set out in section 179(3):

In considering an appeal under this section the Court shall have regard to -

(a) whether the decision appealed against has caused or is likely to cause serious hardship to the appellant; and

(b) whether the decision appealed against would render the land which is subject to the designation or requirement incapable of reasonable use; and

(c) the extent to which the decision may be modified without wholly or partly nullifying the effect of the requirement or designation -

and may confirm or reverse the decision appealed against or modify the decision in such manner as the Court thinks fit.

3.4 Detail on outline plans

Section 176A

Section 176A contains the provisions concerning outline plans. It was inserted by section 38 of the Resource Management Amendment Act 1997, and is based on section 125 of the former Town and Country Planning Act 1977. The use of an outline plan is intended to provide greater flexibility to requiring authorities, by allowing them to address aspects of final design after the notice of requirement hearing. This reduces the detail required in the earlier stages of the notice of requirement process. Outline plans also help ensure environmental protection, by allowing territorial authorities to comment on and control the effects of development on designated sites. These effects are not always anticipated at the notice of requirement hearing.

Section 176A is generally permissive toward works on designated land. The territorial authority may only 'request' changes to the outline plan, although it can appeal the requiring authority's decision if the requiring authority declines the request. The outline plan process also applies to projects or works that a territorial authority will undertake on designated land.

Submitting an outline plan

The outline plan has to be the work of the requiring authority, and has to be submitted and approved in the name of the requiring authority or its agent. For example, for designations involving schools it is not uncommon for an architect or board of trustees to submit outline plans. The territorial authority needs to be satisfied that the work is by and for the requiring authority.

Information requirements

Section 176A(3) states that an outline plan must show:

(a) the height, shape, and bulk of the public work, project, or work; and

(b) the location on the site of the public work, project, or work; and

(c) the likely finished contour of the site; and

(d) the vehicular access, circulation, and the provision for parking; and

(e) the landscaping proposed; and

(f) any other matters to avoid, remedy, or mitigate any adverse effects on the environment.

The matters contained in (a) to (e) can generally be shown diagrammatically on plans, with little explanation.

Case law

Although relating to section 125 of the Town and Country Planning Act 1977, the case of Ngataringa Bay 2000 Inc v Attorney-General (A16/94, Judge Sheppard) demonstrates that scaled plans are appropriate.

"The question raised by the applicant's submission is whether an outline plan, to be valid, is required to show individually the dimensions of each of a number of similar buildings, or whether it is sufficient to provide a site plan and typical plans and elevations for the buildings. The answer must depend on whether the latter provides the relevant council with sufficient information on the aspects of the work listed in section 125(1) to enable it to understand the proposal and request changes to the proposal within the scope of the section.

... I do not consider the provision of a scaled site plan and typical plans and elevations drawn to scale fell short of the duty imposed by section 125."

Subsection (f), however, is a wide provision. It means that the outline plan needs to provide and consider details of effects such as noise, lighting, glare, odour, heritage, and cultural impact (unless the requiring authority provided details on these when the notice of requirement was considered). The outline plan also needs to take into account the context provided to the outline plan process by the existing designation, and any matters that the territorial authority raised when it assessed the notice of requirement.

Processing an outline plan

Processing an outline plan is a reasonably simple procedure, with no set forms for the application or assessment criteria, and no mandatory provision for public involvement. The territorial authority can consult with other parties, including neighbours, if it believes this is appropriate. The only statutory requirement is that the territorial authority has 20 working days to assess the outline plan, and to make requests to the requiring authority for changes. If the territorial authority makes no requests within that timeframe, the requiring authority can start work. However, the territorial authority can extend the time limits under section 37.

Waiver of the outline plan requirements

Subsection (2) of section 176A identifies three situations where an outline plan is unnecessary.

(2) An outline plan need not be submitted to the territorial authority if -

(a) the proposed public work, project, or work has been otherwise approved under this Act; or

(b) the details of the proposed public work, project, or work, as referred to in subsection (3), are incorporated into the designation; or

(c) the territorial authority waives the requirement for an outline plan.

A waiver involves the territorial authority giving up its powers under the RMA, and is not a decision taken lightly. Territorial authorities should not be asked to waive an outline plan requirement in the absence of information.

The RMA does not give specific guidance on when it is desirable to waive the outline plan requirement under section 176A(2)(b). However, it is appropriate for the territorial authority to consider the level of effects that the proposed work or project may have, and whether the information has already been provided to the territorial authority outside the outline plan process. The waiver of an outline plan requirement removes the right of a subsequent appeal by the territorial authority.

Note that (apart from under paragraph (c)) the territorial authority, does not have decision-making power under this subsection. This means a requiring authority can decide itself that the project or work has been otherwise approved, or decide that the detail has been included in the designation, and to go ahead without lodging an outline plan (for example, it may have provided full plans to the territorial authority or the Environment Court hearing). However, the requiring authority should at least discuss the matter with the territorial authority. If there are disagreements, the requiring authority could potentially be subject to enforcement action.

Public input into outline plans

The procedure is between the requiring authority and the territorial authority. There is no provision for public input into the outline plan process. However, the RMA does not prevent a requiring authority publicising its proposal, and inviting public comment.

3.5 Establishing new designations

Sections 168 and 168A

Sections 168 and 168A set out the procedures for processing a notice of requirement. Section 2.1 of this guide summarises the key steps.

The procedure for a notice of requirement for a new designation is similar to that for a resource consent. Section 169 refers to sections 92, 95 to 103, and 115 applying to notices of requirement for new designations, with any necessary modifications. This means that requests for further information, submissions, and hearing procedures essentially follow the same procedures as for a resource consent. Section 169 also states that the territorial authority must notify a requirement, in accordance with section 93(2). [Section 170 provides an alternative procedure which gives a territorial authority the ability to incorporate a notice of requirement into the proposed district plan, under the First Schedule to the RMA, if it intends to notify a proposed plan within 40 working days of receipt of the notice of requirement. The requiring authority must consent to its requirement being processed in this manner.]

Sections 168 and 168A require territorial authorities to make a recommendation on the notice of requirement once it has received submissions and held a hearing (if necessary).

Information required

Section 168 of the RMA requires a notice of requirement to 'be in the prescribed form'. Form 18 includes the following information requirements:

• the reasons why the designation or alteration is needed to achieve the objectives of the requiring authority
• the physical and legal descriptions (noting any distinguishing characteristics) of the site
• the nature of the work, and any proposed restrictions
• the effect that the proposed work will have on the environment, and the proposed mitigation measures
• alternative sites, routes, and methods that have been considered
• the associated resource consents which will be required, and those that have been applied for
• the consultation undertaken with parties likely to be affected by the designation, public work, project, or work, including if no consultation is undertaken, the reasons why
• additional information (if any) as required by regional or district plans or regulations.

It is important for the requiring authority to consider the matters that the territorial authority is required to consider, or have particular regard to (see section 171, discussed below). The first consideration now appears to be the effects on the environment.

Focus on environmental effects

The Resource Management Amendment Act substitutes a new section 171. This new section requires a territorial authority to focus on environmental effects when it makes a recommendation or a decision. It states:

(1) When considering a requirement and any submissions received, a territorial authority must, subject to Part II, consider the effects on the environment of allowing the requirement, having particular regard to -

(a) any relevant provisions of -

(i) a national policy statement;

(ii) a New Zealand coastal policy statement;

(iii) a regional policy statement or proposed regional policy statement;

(iv) a plan or proposed plan; and

(b) whether adequate consideration has been given to alternative sites, routes, or methods of undertaking the work if -

(i) the requiring authority does not have an interest in the land sufficient for undertaking the work; or

(ii) it is likely that the work will have a significant adverse effect on the environment; and

(c) whether the work and designation are reasonably necessary for achieving the objectives of the requiring authority for which the designation is sought; and

(d) any other matter the territorial authority considers reasonably necessary in order to make a recommendation on the requirement.

(2) The territorial authority may recommend to the requiring authority that it -

(a) confirm the requirement;

(b) modify the requirement;

(c) impose conditions;

(d) withdraw the requirement.

(3) The territorial authority must give reasons for its recommendation under subsection (2).

The amended section 171 changes the focus of what the territorial authority is to consider when making a recommendation. The territorial authority must "Subject to Part II, consider the effects on the environment of allowing the requirement", having particular regard to the various listed matters.

Previously, environmental effects were only addressed in the Form 18 (notice of requirement documentation) and indirectly because of the "subject to Part II" requirement.

The words "subject to Part II" have been held to mean that any other considerations only apply to the extent that they are consistent with Part II.

The wording of section 171 seems to imply that the matters listed in (a) to (d) are only relevant in so far as they impact on environmental effects. However, that relevance is not always clear. The territorial authority may be required to 'consider' environmental effects, but must have additional 'particular regard' to the other matters irrespective of environmental effects, but subject to Part II.

Case law

The requirement to have 'particular regard' has been held to require that the matters be considered, but not that they are standards or requirements that must be fully met.

This requirement has been distinguished from the requirements 'have regard to' or 'take into account' (Donnithorne v Christchurch City Council [1994] NZRMA 97). See also the more recent decision in Beadle v The Minister of Corrections (A74/2002).

Subsection (a): Any relevant provisions of relevant policy statements and plans

The authority must have 'particular regard' to provisions of relevant plans and policy statements, at least for the purpose of assessing environmental effects. However, a designation is not required to meet all relevant district plan standards. There is also no requirement that the designation not be contrary to objectives and policies.

Subsection (b): Adequacy of consideration of alternatives

There is considerable case law on this issue. Note that only the adequacy of the requiring authority's consideration of alternatives is an issue, not whether any alternative is better than the others.

As of 1 August 2003, the requiring authority only has to consider alternatives if it doesn't have an interested in the land sufficient for undertaking the work, or if it is likely that the work will have a significant adverse effect on the environment. Previously, adequacy of consideration of alternatives was always a relevant (and sometimes determinative) matter.

Subsection (c): Whether the work and designation are reasonably necessary for achieving the requiring authority's objectives

It is difficult to see the link between this factor and environmental effects. It may be that the greater the adverse environmental effects, the more important the question of necessity will become.

Case law

Some case law holds that the question of necessity is only relevant where alternatives have not been adequately considered. However, the recent High Court decision in Takamore Trustees & Ors v Kapiti Coast District Council (Young J, HC Wellington, AP191/02 and AP192/02, the Western Link case) suggests otherwise.

The new section 171 makes it clear that the issue is the necessity of the work and the designation in meeting the objectives. However, the territorial authorities or the Environment Court's role is not to question the objectives.

Subsection (d): Any other matter the territorial authority considers reasonably necessary in order to make a recommendation

This is a new consideration in section 171. It mirrors section 104(1)(i) concerning resource consents. Arguably, however, other matters are only relevant if they assist in assessing environmental effects (given the opening words of section 171(1)).

It is important to remember that none of the matters in paragraphs (a) to (d) are standards or preconditions. Part II always prevails.

The territorial authority's recommendation

The recommendation to the requiring authority can be to confirm the requirement, modify the requirement, and/or impose conditions or withdraw the requirement. Reasons are required for the recommendation.

Although there is no explicit reference to the Fourth Schedule to the RMA, the information needed for a notice of requirement is essentially the same as that required for a resource consent. Form 18 necessitates requiring authorities to include 'the effects that the proposed works will have on the environment'. Therefore, in practice, an AEE is generally provided by requiring authorities and/or required by territorial authorities.

Requiring authority decision

The requiring authority may accept, or reject the territorial authority's recommendation in whole or part (section 172(1)). The requiring authority can only modify the requirement if the territorial authority has recommended the modification, or if the modification is not inconsistent with the requirement as notified.

For example, a requiring authority cannot lodge a notice of requirement for a four lane road, get a recommendation back from the territorial authority for a four lane road, and then decide to issue a decision authorising a four lane road, plus a bus lane.

The requiring authority must give reasons for its decision if it rejects the territorial authority's recommendation in whole or part, or modifies the requirement (section 172(3)).

The requiring authority must advise the territorial authority of its decision within 30 working days of receiving the recommendation (section 172(1)). The territorial authority then has 15 working days to lodge a notice of the decision and a timeframe for appealing that decision. This must be lodged on submitters and the owners/occupiers of land directly affected by the decision (section 173). The RMA allows the notice of decision to be in a summary form, with the full decision available for public inspection (section 173(2)).

The territorial authority, or any person who made a submission on the requirement, can lodge appeals within 15 working days of the date on which the notice of decision is given (section 174).

After the appeal period has expired, or after any appeals are withdrawn or dismissed, the designation is to be included in the district plan, as if it were a rule. It takes effect as soon as it is in the district plan.

Consultation

One of the information requirements in Form 18 asks applicants to give details of: "The following consultation (or no consultation) has been undertaken with parties that are likely to be affected".

Consultation with the community generally is optional, but highly desirable.

Consultation with tangata whenua is mandatory (at least for the Crown and local authorities). It is also highly desirable for requiring authorities, depending on the effects on any particular proposal. Note that the consideration of effects (section 171) is subject to Part II. Sections 6(e), 7(a), 7(aa) and 8 of Part II are particularly relevant to designations.

Case law

The optional nature of consultation for designations was confirmed in Malfroy Area Residents Action Group Inc v Rotorua District Council (A92/98, Environment Court). The Court decided "The words "if any" bear significance. Although the possibility of consultation having occurred is recognised, with a statement being required to be included in the notice where it has occurred, the words "if any" admit of the possibility that consultation may not have occurred and support the contention for the [requiring authority] that consultation was not a statutory prerequisite."

Assessment of alternative sites, routes and methods

Form 18 requires information on the alternative sites, routes, and methods that have been considered. The wording implies that an assessment of alternatives is not always necessary. This is consistent with the requirements of amended section 171(1)(b), discussed below.

The amended section 171(1)(b) requires the requiring authority to consider alternative sites, routes and methods if it doesn't have an interest in the land, or if there is the likelihood of significant adverse effects. In either of these circumstances, existing case law about the adequacy of the process would remain relevant.

Conditions on designations

The territorial authority can recommend conditions on a designation if:

• it has concerns about a particular aspect of a notice of requirement, or
• it wishes to limit the extent of the designation.

The RMA does not limit the scope of these conditions. However, case law suggests that they must be consistent with Part II of the Act, relate to the effects of the proposed activity, and not be unreasonable, uncertain or unenforceable.

Note that conditions become an integral part of the designation, and can't be severed from it. If the requiring authority wishes to undertake works that are within the scope of the designation, but conflict with a condition, it can:

• lodge an application for a resource consent for the works, or
• lodge a notice of requirement to alter the designation to remove the condition.

A resource consent process would grant permission for the works on a one-off basis, while an alteration would permanently remove the condition.

When recommending a condition, a territorial authority must have regard to the potential effect of the condition on the designation's future operation. Placing conditions on a designation that cannot be met and require a (land use) resource consent can thwart the intent of the designation process.

Case law

Although there is no explicit restriction on the type of conditions that can be imposed on a designation, it is generally accepted that conditions that have the effect of unduly frustrating a consent are unsatisfactory (Lyttelton Port Company Limited v Canterbury Regional Council (C8/2001)).

Case law on consent conditions is generally applicable to designations. A recommended condition must:

• be for a resource management purpose
• be fairly and reasonably related to the proposed work, and
• not be so unreasonable that a reasonable territorial authority could not have recommended it.

This approach was approved (in the resource consent context) in Far East Investments Limited v Auckland City Council (A048/01). Imposing a condition that requires an applicant to take measures beyond those required to mitigate effects caused by the proposed activity would be unreasonable (Sampson v Waikato Regional Council (A178/2002) and Housing New Zealand v Waitakere City Council [2001] NZRMA 202 (CA)).

Territorial authority officer concerns should be set out in the officer's report and made clear during the hearing, particularly during the officer's report to the hearings committee on the requirement. The territorial authority officer should attach a revised set of recommended conditions to his or her reply, which take into account any developments at the hearing. The requiring authority would then have a chance to comment on the revised recommended conditions in its submissions at the close of the hearing. However, the commissioners or councillors may depart from or add to conditions suggested by the territorial authority officer or the requiring authority.

Including a designation in a proposed district plan

Territorial authority's can use the district plan process set out in the First Schedule when they:

• roll-over a designation from an operative district plan, or
• receive a notice of requirement for a new designation within 40 working days of the intended date of notification of a proposed district plan (section 170).

There is a Guidance Note on this topic on the Quality Planning website www.qualityplanning.org.nz.

The First Schedule provides an opportunity for territorial authority's to include new and altered designations in the proposed district plan, and to review all existing designations. The First Schedule process runs parallel to the process under Part VIII of the Act. Clauses 4, 9, 13 and 14 of the First Schedule relate specifically to designations, and allow public involvement in the designation process at the same time as the proposed district plan process. Several other clauses relate to both the proposed district plan as a whole and to the requirements within it.

Time delays are a major issue for requiring authorities going through the First Schedule process. From the date that a territorial authority gives notice of an impending proposed plan through to the date of notification is inevitably several months. Following this, it can be years before the notices of requirement are heard and any required recommendations are issued.

However, section 19 could arguably allow the designation in the proposed plan to be deemed operative if:

• no submitters wish to be heard, or
• no appeals are lodged on the requiring authority's decision, or
• any appeals are disposed of by the Environment Court.

If this is correct, the 4-10-year delays which were usual before the Resource Management Amendment Act 2003 should be unlikely.

Purchase of designated land by requiring authorities

When a requiring authority designates land, depending on what the designation is for, it may impose considerable restrictions on the use of that land, and consequently its value. Under section 185 of the RMA people can seek an order from the Environment Court for obliging the requiring authority to acquire or lease all or part of the land, if a designation has either resulted in the land becoming unable to be sold at market value or if the designation has prevented the reasonable use of land. Detail about procedures and tests are beyond the scope of this Guide.

Case law

Skipworth v Queenstown Airport Corporation Limited ((1998) NZRMA 410, Environment Court) identifies a number of points the Environment Court regarded relevant to the exercise of its discretion. On appeal, the High Court upheld the Environment Court decision that the Corporation was ordered to purchase the property under the Public Works Act 1981 (Queenstown Airport Corporation Limited v Skipworth, AP 19/99, High Court).

The applicant must have been the owner of the land when the designation or requirement was created.

Interim effect of a notice of requirement

A designation has an interim effect from the time that a requiring authority lodges it with the territorial authority, or that a territorial authority notifies its own requirement for a designation. The interim effect protects the land from other activities that may hinder or prevent the work or public work that the designation concerns. The written approval regime of section 176(1)(b) of the RMA starts immediately.

However, lodging a notice of requirement does not give the requiring authority any rights to undertake work immediately.

3.6 Alterations to designations

Section 181(3)

Section 181(3) states that a territorial authority can alter a designation at any time, provided certain criteria are met. If the criteria are met, the alteration can be made without the formal process of notification and submissions required for a new designation. Section 181(3) outlines the criteria.

(3) A territorial authority may at any time alter a designation in its district plan or a requirement in its proposed district plan if -

(a) the alteration -

(i) involves no more than a minor change to the effects on the environment associated with the use or proposed use of land or any water concerned; or

(ii) involves only minor changes or adjustments to the boundaries of the designation or requirement; and

(b) written notice of the proposed alteration has been given to every owner or occupier of the land directly affected and those owners or occupiers agree with the alteration; and

(c) both the territorial authority and the requiring authority agree with the alteration -

This allows minor alterations to wording and boundaries to be achieved in a pragmatic manner.

If a requiring authority's request for an alteration does meet the criteria, the territorial authority is required to agree to the simplified procedure. However, if the criteria are not met, the procedures of sections 168 to 179 (providing a notice of requirement for a new designation) apply.

Subsection (a): minor effects and minor changes

The simplified procedures under section 181(3) are available provided that there is no more than a minor change to the effects on the environment or if it only involves minor changes or adjustments to the boundaries of the designation or requirement. The wording of subsection (a)(ii) implies a change from the level of effects that would be associated with the designation before the alteration. This is consistent with the 'permitted baseline' approach taken in Bayley v Manukau City Council ([1999] NZLR 568; [1998] NZRMA 513; (1998) 4 ELRNZ 461, CA115/98, Court of Appeal). The question of "what is a minor change to the effects on the environment?" is a common test used by the RMA.

Whether a change or adjustment to the boundaries is minor or not will depend on the facts of the application. Territorial authorities must decide this on a case-by-case basis.

Subsection (b): land directly affected

The definition of "owners or occupiers of land directly affected" has considerably less scope, and should not be confused with, a more general assessment of potentially affected persons. The wording of subsection (b) clearly means a limited group of people. It anticipates that they must have an interest in the land subject to the designation, or the area subject to a minor adjustment to the boundaries of the designation.

3.7 Removal, lapsing and transfer of designations

Removing designations

Section 182(1) allows a requiring authority to give notice that it no longer wants a designation or part of a designation in a district plan. Removing a designation is also known as 'uplifting'. The requiring authority gives notice on Form 23 to:

(a) The territorial authority concerned; and

(b) Every person who is known by the requiring authority to be the owner or occupier of any land to which the designation relates; and

(c) Every other person who, in the opinion of the requiring authority, is likely to be affected by the designation.

The territorial authority can decline to remove part of a designation, if it considers that the effect of that removal on the remaining part of the designation is more than minor (section 182(5)). Although this situation is unlikely, an example may be where a designation was imposed with a buffer area. The partial removal would reduce this buffer area, and increase the effects caused by the remaining part of the designation. The requiring authority has a right of objection (section 357), and rights of appeal on the territorial authority's decision on that objection.

Section 182(2) states that the territorial authority "shall, without further formality amend its district plan" to show the removal of a designation or part of a designation. The wording indicates that the complete removal of a designation should be an administrative task, not requiring analysis, or the involvement of territorial authority decision makers.

Revoking requiring authority status

The Minister for the Environment can revoke the requiring authority status of any network utility operator (section 167(6)), when a requiring authority:

• is unlikely to undertake or complete a project, work or network utility operation, or
• is unlikely to satisfactorily carry out any responsibility as a requiring authority under the Act, or
• is no longer a network utility operator.

This revocation occurs by notice in the Gazette. All functions, powers and duties of the former requiring authority are deemed to be transferred to the Minister. Section 167(6) does not expressly state that the designation is revoked along with the requiring authority status. It is unlikely that any designation would be automatically revoked by the Minister.

Designation lapse

Sections 184 and 184A state that designations will lapse if they are not used within a reasonable timeframe. This is important because a requiring authority should not be entitled to incorporate a designation into a district plan (which imposes restrictions on any private owners or occupiers of that property) and then not utilise it within a reasonable timeframe.

'Lapse' has its ordinary legal meaning: a right becomes void, or expires, through non-fulfilment or disuse. A lapsed designation is not capable of revival. However, a requiring authority can however seek an extension of the time to give effect to a designation in accordance with section 184, or it may lodge a new notice of requirement.

A designation of a requiring authority, other than a territorial authority, lapses five years after the date it is included in the district plan, unless:

• it is 'given effect to before the end of that period', or
• the designation specifies a different period before it would lapse, when it was incorporated into the plan, or
• the requiring authority applies within three months of the end of the five-year period, stating that substantial progress or effort has been made, and is continuing to be made.

In this case, the territorial authority must fix a longer period for the requiring authority to give effect to the designation. The 'continuing substantial progress or effort' test is similar to that for resource consents, and does not require completion or near completion of the works. This does not necessarily always mean that physical works must be underway, as determined in the case of Body Corporate 97010 v Auckland City Council (CA234/00 (2001), High Court).

The criteria and tests for 'given effect to'are similar to those for resource consents under section 125 of the RMA.

The five-year period is calculated from date the plan was amended, or the date the plan or part of the plan became operative if the First Schedule is used. The requiring authority can apply for more than one extension of the five-year period.

For territorial authority designations, the territorial authority itself must resolve that it is making and is continuing to make substantial progress or effort towards giving effect to the designation.

Case law

The decision in Marlborough District Council v Regal Salmon Limited (W117/95, Planning Tribunal), determined that the section 184A lapsing provisions did not apply to transitional district plans.

Transferring designations

Section 180 anticipates that from time to time the financial responsibility for projects, work or network utility operations may be transferred from one requiring authority to another. In that case, the RMA specifies that any relevant designations shall also be transferred.

The process for transfer simply requires advice to the Minister for the Environment and the relevant territorial authority. The territorial authority must then update its district plan "without further formality".

In practice, the recent reform of the electricity sector has led to numerous transfers of financial responsibility for network utility operations and consequent transfer of designations. Section 180 only allows for transfer of a designation from one requiring authority to another requiring authority. A network utility operator must become a requiring authority under section 167 before it accepts the transfer of the designation and exercises any rights or responsibilities under it.

Existing use rights

Section 10(1)(b) recognises existing use rights when a designation is uplifted, a requiring authority loses requiring authority status, or a designation lapses. The use may continue, even if the use contravenes a rule in a district plan or proposed district plan. The test is that the effects of the use are the same or similar in character intensity and scale as under the designation.

Case law

The Environment Court (Wilson v Dunedin City Council, C50/94, Planning Tribunal) has expressed "reservations" about whether section 10(1)(b) would provide existing use rights to privately operated activities gained by the mere existence of a previous lawfully established public work. It may be prudent for the territorial authority to seek a declaration about the ability of the private operator to rely on existing use rights, when the activity was formerly authorised by designation. This declaration could be sought jointly with the private operator.

3.8 Enforcement

The general duty under section 17 to avoid, remedy, or mitigate any adverse effect on the environment applies to activities that are authorised by designations. [This change is a response to the Court's view that section 17 did not apply to activities which were authorised by designations - see Watercare Services v Minhinnick [1998] 1 NZLR 294; [1998] NZRMA 113 (Court of Appeal).] Sections 319 and 325 have been amended to make explicitly clear that enforcement orders can be made against persons who are acting in accordance with designations, and that the Environment Court can confirm abatement notices against persons who are acting in accordance with designations, in some circumstances.

Enforcement action does not apply where the adverse effects were expressly recognised at the time that the activity was authorised. [Enforcement action is discussed in the recent case of The Hill Park Residents Association Incorporated v Auckland Regional Council (A30/2003), where the enforcement action related to noise barrier, which was intended to reduce the impact of motorway noise.]

This change is likely to be of concern to requiring authorities, particularly where the effects of the activity that is authorised are beyond the scope of the issues addressed in notice of requirement or the hearing For example, traffic numbers on stretches of roads, and noise generated by that traffic, could be beyond those originally anticipated at the notice of requirement stage. In such instances, enforcement action could apply.