On 16 October 2019, the Victorian Government introduced the Melbourne Strategic Assessment (Environment Mitigation Levy) Bill 2019 to parliament.
The Bill provides for the implementation of agreements between the Victorian and Federal Governments, as set out in the Melbourne Strategic Assessment (MSA) Report in accordance with the Environment Protection and Biodiversity Conservation Act (EPBC Act). It is only relevant for land to which the MSA and Biodiversity Conservation Strategy (BCS) apply.
The legislation comes into effect on 1 July 2020, allowing the property development industry, government and delivery partners, time to prepare their businesses and systems for the new regime.
In addition to providing the legislative framework for the imposition of the environment mitigation levy (replacing the Habitat Compensation fee system), the Bill provides for the amendment of the Building Act 1993, the Commissioner for Environmental Sustainability Act 2003, the Mineral Resources (Sustainable Development) Act 1990, the Subdivision Act 1988, and the Victorian Civil and Administrative Tribunal Act 1998 to give effect for the provision of the Bill.
UDIA Victoria’s policy and advocacy work on this has achieved:
- the retention of staged payment arrangements;
- the retained ability to contribute land for fee reductions;
- rights of review;
- phased fee increases rather than all at once; and
- ongoing systemic reviews, helping to ensure transparency and fairness.
UDIA Exclusive Forum: MSA Industry Briefing from DELWP
UDIA Victoria is pleased to announce that we have secured an exclusive industry briefing from Warrick McGrath, Director Regulatory Strategy and Design – Biodiversity Division at DELWP, who will discuss the must-know elements of the new Melbourne Strategic Assessment Bill for industry.
Date: Wednesday 27 November
Time: 8am registration for 8.30-10am
Location: State Library Theatrette, 179 La Trobe St. Melbourne
Registrations open soon: Please email your interest to Luke – email@example.com to be notified when bookings open.
Key points for industry
Environment mitigation levy
– The environment mitigation levy replaces the Biodiversity Conservation Strategy (BCS) Habitat Compensation fee system.
– The environment mitigation levy will be indexed annually to 2024-2025. Indexation is calculated according to a weighted balance of consumer price index and wage price index. The average adjustment in the five years to 2019 has been 1.7%.
– The levy for FY 20/21 has been calculated based on an updated estimate of the cost of implementing the program, which has almost doubled since the introduction of the BCS.
Levy amounts are set out below:
|Habitat area||Fee per hectare of habitat area||% increase from current fees|
|Golden Sun Moth||$10,005||26%|
|Growling Grass Frog||$7,846||4%|
|Any Native vegetation area||$113,441||19%|
|Scattered tree location||$15,768||19%|
|Southern Brown Bandicoot||$4,138||3%|
Imposition of levy
- The levy is payable where where land is in the levy declaration area and a leviable event has occurred.
- Payment is typically triggered at Statement of Compliance, must be paid prior to registration of titles, or prior to the issue of a building permit where no subdivision is proposed. A building surveyor cannot issue a permit, or plan of subdivision may not be registered, until the levy has been paid or staged payment agreed.
- The published ‘environment mitigation dataset’that determines where levies are payable is available at www.msa.vic.gov.au.
- The Bill defines excluded building work and excluded events where the environment mitigation levy is not imposed/payable. These are generally activities minor in nature, or where the activity would not be subject to Commonwealth approvals under the current system. Land transfer agreements are exempt. The exclusions have also been brought into line with the GAIC excluded events such as boundary realignments and minor excisions.
- Staged payments are permitted where an application has been sought and approved.
- Where works or events are excluded, an applicant will be able to apply for a certificate of no liability to allow the issue of a building permit or lodgement of plans of subdivision.
- Levy related certificates can be applied for to document the status of levy liabilities, payments and for staged payment approvals.
- Where a habitat compensation payment has already been made, there is no further obligation, and agreements entered into prior to the commencement of the legislation will be recognised.
- Land contributed for conservation purposes will reduce levy liabilities.
- Levy assessments will be subject to a right of review at VCAT.
Transparency, accountability, and reviews
- establishes the Melbourne Strategic Assessment Fund, and specifies the purposes for which the fund may be used;
- requires the Minister to publicly report on the use of the funds;
- clarifies the intention that the levy is targeting full cost recovery for MSA activities;
- requires the Sustainability Commissioner to review the package every two years and undertake independent audits of the process and systems; and
- requires the Minister to undertake 5-yearly reviews of the activities to achieve conservation outcomes, the associated levy amounts, and indexation measures, to be subject of detailed cost benefit analysis and a public exhibition process with submissions to be considered prior to approval.