GROWING LOCAL ECONOMIES FUND NORTH EAST GOULBURN ENTERPRISE CORRIDOR PRECINCT ENHANCEMENT BUSINESS CASE

GOULBURN MULWAREE COUNCIL VERSION 1 9 JULY 2018

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KEY PROPOSAL DETAILS PROPOSAL INFORMATION

Proposal Name North East Goulburn Enterprise Corridor Precinct Enhancement

Lead Proponent Goulburn Mulwaree Council

Lead Proponent ABN 84 049 849 319

Proposal partners N/A

LEAD CONTACT

Name Mr Warwick Bennett

Position General Manager

Phone 02 4823 4444

Email grants@goulburn.nsw.gov.au

Fax 02 4823 4477

Address 184-194 Bourke St, Goulburn, NSW, 2580

PROPOSAL SCOPE

Proposal summary for publication

Please provide 150 words or less An area of underutilised employment land at south Common St, Goulburn will be rezoned to accommodate IN1 General Industrial development and south Common St, Sinclair St and the intersection of Sydney Road and Common St will be upgraded to facilitate access by vehicles up to B-double classification. Water, sewerage and stormwater services to the area will also be upgraded to accommodate industrial outputs. The Goulburn Mulwaree Employment Land Strategy 2016 and industry development proposals evidence the need for industrial land in this location. Independent analysis confirms a foundation business will immediately generate 150 FTE ongoing jobs, representing annual wages of $6M and operating costs which will have a direct and multiplier impact on economic output of $36M annually. This effect is forecast to be significantly magnified by further uptake of industrial sites in the precinct in the medium term.

PROPOSAL LOCATION

Proposal address Common St, Goulburn, NSW, south of the Sydney Road intersection

Local government area Goulburn Mulwaree Council

NSW electorate Goulburn

Federal electorate Hume

SUPPORTING INFORMATION

Attachments Please list out all supporting information provided

Attachment 1 – Goulburn Mulwaree Employment Land Strategy 2016 Attachment 2 – Map of project site and current zoning Attachment 3 – Common St Poultry Processing Facility, KDC for Woodlands Ridge Poultry Attachment 4 – Advanced Precast Letter of Support Attachment 5 – SGS Economics and Planning Growing Local Economies Northeast Goulburn Enterprise Corridor Report Attachment 6 – Castlecrest/KDC Analysis for GLEF Goulburn Mulwaree Council EOI Attachment 7 – Project Budget Attachment 8 – Common St Infrastructure Concept Designs Attachment 9 - Goulburn Mulwaree Development Control Plan 2009 Extract Attachment 10 – Common St Project Gantt Chart Attachment 11 – Asset Management and Maintenance Plan Attachment 12 – Audited Financial Statements Attachment 13 – Project Management Plan Attachment 14 – Risk Management Plan Attachment 15 – Datasheet Workings and Assumptions

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DOCUMENT INFORMATION Document Summary Information

Version 1

Version Release Date 9 July 2018

Document Security Commercial in Confidence

Document History

Version Amendment Amendment Date Amended by

1.0 Final 9 July 2018 Rebecca Noonan

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CONTENTS

1 EXECUTIVE SUMMARY ....................................................................................................................... 5

2 CASE FOR CHANGE ........................................................................................................................... 6

2.1 BACKGROUND .............................................................................................................................. 6

2.2 RATIONALE FOR INVESTMENT ................................................................................................... 8

2.3 STRATEGIC ALIGNMENT ........................................................................................................... 11

2.4 EXPECTED OUTCOMES............................................................................................................. 14

2.5 STAKEHOLDER & COMMUNITY SUPPORT............................................................................... 18

3 ANALYSIS OF THE PROPOSAL ....................................................................................................... 19

3.1 OBJECTIVES & INDICATORS ..................................................................................................... 19

3.2 THE BASE CASE ......................................................................................................................... 20

3.3 OTHER OPTIONS CONSIDERED ............................................................................................... 20

3.4 INFORMATION ABOUT THE PROPOSAL ................................................................................... 20

3.5 PROJECTED COSTS .................................................................................................................. 24

3.6 COST-BENEFIT ANALYSIS ......................................................................................................... 26

3.7 FINANCIAL APPRAISAL .............................................................................................................. 30

3.8 PROPOSED FUNDING ARRANGEMENTS ................................................................................. 30

3.9 FINANCIAL HEALTH & SUPPORT .............................................................................................. 31

4 IMPLEMENTATION CASE ................................................................................................................. 32

4.1 PROGRAM & MILESTONES ........................................................................................................ 32

4.2 GOVERNANCE ............................................................................................................................ 32

4.3 KEY RISKS .................................................................................................................................. 35

4.4 LEGISLATIVE, REGULATORY ISSUES & APPROVALS ............................................................ 36

4.5 PROPOSED MANAGEMENT ACTIVITIES .................................................................................. 37

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1 EXECUTIVE SUMMARY Goulburn Mulwaree, in the Southern Tablelands region of NSW, is highly accessible with excellent road and rail connections. Its location between Canberra and Sydney and quality road infrastructure gives easy access to the 12.6 million people living in the NSW/ACT/VIC coastal ribbon and their demand for consumer goods. Accessibility also creates significant opportunities for the establishment of a range of employment uses reliant on high quality transport connections and accessibility to domestic and international markets.

In the year ending June 2017 the Goulburn Mulwaree Council area Gross Regional Product was $1.46B, an increase of 3.2% on the previous year. The largest industry sectors by value added were Public Administration and Safety ($176M, or 14.1% of GRP), Health Care and Social Assistance ($138M, or 11.1% of GRP) and Mining ($98M, or 7.9% of GRP). The highest growth sectors by value added included Agriculture (total value added $68.6M, +16.1%) and Food Product Manufacturing (total value added $32M, +4.9%), which are recognised in the draft Southern Tablelands Regional Economic Development Strategy as regional specialisations.

In November 2016 Goulburn Mulwaree Council adopted the Goulburn Mulwaree Employment Land Strategy, an independent report commissioned to identify strengths, weaknesses and opportunities in the zoning of land to meet current and future employment land needs. Although the report found the LGA to have an adequate supply of industrial land, it identified action required to remove barriers to investment limiting the economic potential of designated enterprise areas. One such area is the North-East Goulburn Enterprise Corridor Precinct, adjacent to the city’s northern Hume Highway interchange, and in particular an area identified as the south Common Street sub-precinct, adjacent to the Goulburn Waste Management Centre. This area features a number of privately held, large, undeveloped blocks in a low-density rural-residential area, adjacent to the national road network and the city’s waste facility, making it ideal for industrial development. The Strategy assessed the current B6 Enterprise Corridor zoning, issues with accessibility and connectivity and the application of Developer Contribution Schemes to be stifling business investment in this area. This finding is supported by evidence of business interest in the area, including a proposal for a $90M poultry processing and cold storage facility and a proposed building products manufacturing facility, both of which cannot proceed under the precinct’s current planning and infrastructure conditions.

In line with the recommendations of the Goulburn Mulwaree Employment Land Strategy, Goulburn Mulwaree Council proposes to rezone south Common St to IN1 General Industrial, upgrade key roads to facilitate heavy vehicle access and enhance water, sewer and stormwater services to meet industrial requirements. The total cost of this proposal is $7.78M. The grant request to the Growing Local Economies Fund is $7.15M, with the balance to be funded by Goulburn Mulwaree Council.

This proposal will directly facilitate establishment of the two businesses referred to above, the poultry processing facility at 52 Sinclair St (accessible via south Common Street) and the building products manufacturing facility at 5 Common St. The proponent of the 52 Sinclair St development is Woodlands Ridge Poultry, a local poultry farming operation proposing to extend into poultry processing and value-adding, bringing truly new investment to the region and the state. Economic modelling has forecast the impact of this development to be direct ongoing employment of 150 FTE, representing $6M pa in wages, and a direct and multiplier effect on economic output from the facility’s operating costs of $36M pa. The proponent of the building products manufacturing facility is Advanced Precast, which withdrew a DA for development of the site in December 2017 due to current zoning limitations, but remains committed to proceeding if the right planning framework can be secured.

In addition to these developments the infrastructure created by the proposal will unlock the economic potential of the remainder of the south Common St site, consisting of 64 hectares of developable land in total. Independent analysis conservatively estimates an uptake of 50% of developable land in the area within 15-20 years, resulting in a further estimated $168M of capital investment in the region.

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2 CASE FOR CHANGE 2.1 BACKGROUND Goulburn Mulwaree is strategically located on the Hume Highway within the Sydney-Canberra Corridor Region in south-eastern New South Wales. The City of Canberra is 90km south west of Goulburn via the Hume/Federal Highways (M23); Sydney CBD is located 196km (approximately 2 hours’ drive) to the north east via the Hume Highway (M31), with Wollongong 152km to the east.

Its excellent road and rail connections and location between Canberra and Sydney gives easy access to the 12.6 million people living in the NSW/ACT/VIC coastal ribbon and their demand for consumer goods. This also creates significant opportunities for the establishment of a range of employment uses reliant on high quality transport connections and access to domestic and international markets.

Connectivity

Road - The Hume and Federal Highways pass through the LGA and are the main freight and travel routes between Sydney, Canberra and Melbourne. Highway interchanges are located at the city’s northern entrance (providing northern access only) and southern entrance (providing north/south access) and 3km south of Marulan village, facilitating access to several major quarries.

Rail - The Great Southern Rail line connecting Sydney, Canberra and Melbourne passes through Goulburn. A rail freight hub provides rail freight links to Port Melbourne, Port Botany and Port Kembla.

Air - Goulburn has a registered aerodrome approximately 7km south-east of the city, which is available for both recreational and commercial purposes. Canberra Airport, located 90km to the south-west, offers both domestic and (limited) international passenger and airfreight services. The development of Sydney’s second airport at Badgery’s Creek, 162km to the north will increase transport connectivity and increase the attractiveness of the region to freight-dependent industries.

Ports – Port Botany is 190km north-east and Port Kembla 168km east of Goulburn; both have good road connections from the Local Government Area. A rail freight hub provides direct rail access to both ports.

Population

In the 2016 Census 29,614 people listed Goulburn Mulwaree as their place of usual residence. Over the past 10 years (2007 – 2016) the LGA has experienced average population growth of 1.4% annually.

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The percentage of the Goulburn Mulwaree population holding Bachelor degree qualifications or higher is 11.5%, which is below the regional NSW average of 14.5%; the number of people in the LGA with Diploma or vocational qualifications is in line with the regional NSW average.

Industry

Goulburn Mulwaree Council (GMC) area’s Gross Regional Product was $1.46B in the year ending June 2017, an increase of 3.2% on the previous year. This was the third consecutive period of strong growth, which has seen the GRP increase 10% since 2014.

Over this period (FY1314 – FY1617) the best performing industry sectors measured by increase in value added were:

Non-metallic Mineral Mining and Quarrying +58%

Agriculture +20.1%

Public order, safety and regulatory services +7.5%

Social Assistance Services +7.1%

Food product manufacturing +7.0%

In FY1617 the largest industry sectors by value added were Public Administration and Safety ($176M, or 14.1% of GRP), Health Care and Social Assistance ($138M, or 11.1% of GRP) and Mining ($98M, or 7.9% of GRP); and the largest industries by employment were Health Care and Social Assistance (2,295 people, or 17.4%), Retail Trade (1,435 people, or 10.9%) and Public Administration and Safety (1,268 people, or 9.6%).

In November 2016 a Goulburn Mulwaree Employment Land Strategy (GMELS) commissioned by Council and prepared by Hill PDA Consulting made the following observations regarding the LGA’s economic base:

- A high job containment rate (70%) means the LGA’s economy plays a critical role in keeping its residents in paid work.

- The actual and forecast population increase for the LGA of 18% between 2011-2021 is significantly greater than that experienced between 2001-2011 (3%).

- The prominent and emerging industries in the LGA include extractive industries, transport freight and logistics, air freight (Badgerys Creek and CBR), rural industries and meat processing.

- Industrial land capacity must be retained for expansion of food processing facilities and transport freight and logistics uses, which will support growth in rural industries. Food processing industries are heavily reliant on sites which can deliver access to transport routes (primarily road), water connections and waste management (see Attachment 1 – Goulburn Mulwaree Employment Land Strategy 2016).

Infrastructure

Over the past fifteen years GMC, with the support of the NSW State and Australian Governments, has developed the main supporting infrastructure critical to securing long term business investment in the region. In 2011 completion of the Highlands Source Project ensured a reliable water supply for the region, a state-of-the-art Waste Water Treatment Plant facilitating wastewater recycling for use on parks and recreational fields and future industrial reuse will be completed in the second half of 2018, and in 2019-2020 Council will invest in a $4M upgrade of the Goulburn Waste Management Centre.

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2.2 RATIONALE FOR INVESTMENT Goulburn Mulwaree Employment Land Strategy 2016 (GMELS)

GMELS was commissioned to identify strengths, weaknesses and opportunities in the zoning of land in the LGA to meet current and future employment land needs (other than rural production lands).

It establishes that 72% of vacant land with an industrial zoning and all the vacant IN3 - Heavy Industry land in the LGA is located at Tarago, 30 minutes south of Goulburn, with no direct access to the national road network. Much of this land is owned by Veolia and serves as a buffer to the Woodlawn Bioreactor, a sustainable processing facility for putrescible waste from Sydney. The area consists of very large sites suitable for heavy industry and is not considered appropriate for general industrial purposes in this format.

In the vicinity of Goulburn city, lands currently zoned for industrial use are in four main locations:

North Goulburn (opposite Goulburn Correctional Centre) – principally IN2 - Light Industrial. Caters for service-based industries such as auto repairs and trade suppliers. Only a few small, undeveloped lots remain available and interspersal with residential uses limits new development.

Bradfordville – IN1 – General Industrial with a variety of available lots of various sizes. A popular area for warehousing, storage and automotive industry facilities and due to its popularity the current supply of available lots is forecast to meet only short to medium-term needs. Has only indirect access to the national road network so considered inappropriate for intensive industrial uses involving significant road transport movements.

South Goulburn – IN1 – General Industrial. Consists of a number of sub-precincts along Sloane St, Finlay Rd and Tait and Lockyer Crescents. Well located adjacent to the south Goulburn Hume Highway interchange but requires planning and investment to provide safe, efficient access to the national road network. Currently the subject of a planning study to identify priority development opportunities and infrastructure needs.

Murrays Flat – IN1 – General Industrial. Comprising three vacant lots with a combined area of 169 hectares. Good proximity to the Hume Highway and can potentially provide rail access via a private siding, but significant planning and consultation is required to provide connectivity to these assets.

Due to the identified constraints with existing industrial precincts, GMELS recommended application of an IN1 General Industrial zoning to an area in the North East Goulburn Enterprise Corridor, identified as the south Common St sub-precinct. This sub-precinct is currently principally zoned B6 Enterprise Corridor. Its location adjacent to the Goulburn Waste Management Centre renders the area subject to existing truck movements and some odour and noise. This, along with the availability of large (5-8 hectare), undeveloped blocks close to the Hume Highway, and the low density of residential uses in close proximity, make it an ideal location for industrial development.

The specific recommendations of GMELS relevant to this location are:

- The area bounded by Sinclair, Chiswick and Common Streets and the Waste Management Facility to the east should be rezoned to IN1 General Industrial

- Investigate the feasibility of improved access and connectivity within the precinct to support existing and/or future industry

GMC proposes to extend the IN1 rezoning recommended by GMELS also to the western side of Common St, which has similar characteristics suitable for general industrial purposes to the eastern blocks. While GMELS proposes to leave this area as B6 to provide a buffer to industry located on the eastern side of Common St, GMC is of the view that the lack of uptake of Common St for B6 enterprise purposes to date, the existing buffer of the RU6 and E3 zones between the western side of Common St and residences of Long Street (see Attachment 2 – Map of project site and current zoning), the existing and continuing

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operations of the Goulburn Waste Management Centre and the extremely low density of housing in the vicinity of Common St make it appropriate to propose rezoning of both sides of Common St to IN1.

Evidence of Need for IN1 Zoned Land

There is significant evidence from industry proponents that current zoning and accessibility/connectivity issues are impeding the development of the Common St sub-precinct:

Woodlands Ridge Poultry – a proposal for a $90M cold storage, poultry processing and distribution centre at 52 Sinclair St (within the Common St sub-precinct) is not permitted by the current B6 Enterprise Corridor zoning but planning permission facilitating its establishment will be sought via the State and Regional Development SEPP (see Attachment 3 - Common St Poultry Processing Facility, KDC for Woodlands Ridge Poultry).

Advanced Precast – in December 2017 Advanced Precast withdrew a DA for a pre-cast building panel manufacturing, storage and distribution facility at 5 Common St, following advice from Council that the proposal was unlikely to be permitted within the current B6 Enterprise Corridor zoning. Recent consultation with Advanced Precast has confirmed their willingness to proceed with the development if an appropriate rezoning can be secured (see Attachment 4 – Advanced Precast Letter of Support).

International consortium proposal – in June 2018 a consortium of Chinese investors presented to Council staff an initial proposal for an international tourism-focussed wool processing centre at 48 Common St, some elements of which would not be permissible under the current B6 zoning. This proposal is in the early stages of development and no further details are available as at the time of submission of this application.

RDP Group – this Goulburn-based business is seeking to relocate from Western Sydney to Goulburn a recently purchased building products manufacturing business. This requires a large site with IN1 or IN3 zoning away from sensitive land uses and with good connectivity to road transport routes. Sites meeting these requirements in the LGA are limited and the proposed Common St sub-precinct project will assist to meet identified demand. GMC has not sought a letter of support from this proponent as the relocation must be undertaken in the immediate term, before rezoning of the Common St area is achieved.

Consultation with business owners and land holders conducted by Hill PDA Consulting identified the region’s existing specialisation in poultry production and found sustainable building products to be an emerging industry in the area, which is supported by industry data and further reinforced by GMC’s contact with potential business investors. The consultation also identified Developer Contributions Schemes applicable to Common St (under S94 of the Environmental Planning and Assessment Act 1979 and S64 of the Local Government Act 1993) to be a disincentive to investment. The consultation revealed Common St to be viewed as an unattractive investment proposition due to the B6 Enterprise Corridor zoning, application of Developer Contribution Schemes and issues with connectivity to the Hume Highway, via Sydney Road (Attachment 1 – Goulburn Mulwaree Employment Land Strategy 2016, p143).

Purpose of IN1 General Industrial Zoning

The IN1 General Industrial zoning specifically permits the following activities, with consent:

Depots; Extensive agriculture; Freight transport facilities; Funeral homes; Garden centres; General industries; Hardware and building supplies; Industrial training facilities; Kiosks; Landscaping material supplies; Light industries; Markets; Medical centres; Neighbourhood shops; Places of public worship; Plant nurseries; Rural supplies; Sawmill or log processing works; Stock and sale yards; Timber yards; Vehicle sales or hire premises; Warehouse or distribution centres.

It is the view of Goulburn Mulwaree Council Planning staff that IN1 General Industrial Zoning will facilitate the Woodlands Ridge Poultry and Advanced Precast developments at Common St, subject to further information about the proposals becoming available.

The objective of IN1 - General Industrial lands is to:

- Provide a wide range of industrial and warehouse land uses;

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- Encourage employment opportunities;

- Minimise any adverse effect of industry on other land uses; and

- Support and protect industrial land for industrial uses.

Each of these will be discussed with respect to the proposed re-zoning of the site.

Provide a wide range of industrial and warehouse land uses

The current zoning allows for light industrial uses. By re-zoning from B6-IN1, the site can be used for general industrial purposes and will be better aligned with the demand for industrial land in Goulburn.

Encourage employment opportunities

As shown within a report regarding the economic potential of the proposal site (Attachment 5 - SGS Economics and Planning Growing Local Economies Northeast Goulburn Enterprise Corridor Report), at the time of the 2016 Census, there were 855 people in the LGA unemployed and looking for work. The results of input-output modelling by Castlecrest and KDC (Attachment 6 - Castlecrest and KDC Analysis for GLEF Goulburn Mulwaree Council EOI) demonstrate that the proposed poultry processing facility will conservatively accommodate 150 full-time workers. Advanced Precast expect to employ 30 permanent and 15 casual staff (Attachment 4 – Advanced Precast Letter of Support).The construction of the facilities will also boost construction related jobs both directly and as a result of multiplier effects.

Minimise any adverse effect of industry on other land uses

This site has been identified for industrial purposes due to its situation adjacent to the Goulburn Waste Management Centre and low density residential population, thereby minimising the potential impact of developments on surrounding uses.

Support and protect industrial land for industrial uses

The proposal responds to a need for industrial land that cannot currently be met elsewhere in the LGA. The re-zoning of the site is a sign that industrial land and subsequently firms operating in the industrial space will be encouraged and supported by the local council.

Cost of alternatives to Goulburn Industrial Land

Sydney

Western Sydney industrial land is a major competitor for Goulburn industrial land, with the advantage that it is closer to the major population centres of Sydney and close to a number of freeways. However, land prices are also much higher in Western Sydney. A recent Colliers market report for industrial land values in Sydney ranged from around $350 - $470m2 in Western Sydney. This is the cheapest industrial land in Sydney, however it is almost ten times more expensive than industrial land in Goulburn.

The report also identifies the growth in prices of industrial land in Sydney, with shortages projected to push prices higher.

Canberra

ACT industrial land, while more affordable than Sydney land, is still much more expensive than Goulburn land. Recent asking prices for land on Allhomes show prices for vacant industrial sites in Hume of a little over $100m2.

In comparison, recent industrial land valuations show valuations of Goulburn land zoned IN1 between $25-$75m2 (Attachment 5 – SGS Economics and Planning GLEFNorth East Goulburn Enterprise Corridor Rpt).

As the development of the Western Sydney airport progresses, higher value uses of Western Sydney industrial land are expected to push more and more businesses out of the area, particularly those that require large amounts of land, such as for manufacturing and food processing.

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2.3 STRATEGIC ALIGNMENT This strategic assessment considers relevant state, local and regional strategic plans and identifies how the Common Street project aligns with these objectives.

NSW Premier’s Priorities

• Creating 150,000 jobs by 2019

The project will unlock 64ha of employment generating land resulting in increased construction and ongoing employment in the region. Two foundation developments alone will deliver 180 ongoing, FTE jobs.

• Delivering Infrastructure

Infrastructure investment in the south Common Street sub-precinct will enable two industrial developments which will increase the economic output of the region.

NSW Trade and Investment Action Plan 2017-2018

The plan specifically identifies food, fibre and agriculture as a key growth opportunity and state priority. The target is to grow exports of food and fibre from $7.4 billion to $10 billion by 2020.

This proposal will deliver critical infrastructure services to the Woodlands Ridge Poultry processing facility, the precinct’s catalyst operation. This has the potential to generate a food processing cluster within the region, as the Common Street sub-precinct will be attractive to cognate operations.

An industry profile prepared by the Australian Chicken Meat Federation (ACMF) identifies the importance of the chicken meat industry, with an estimate consumers currently spend $5.6 billion per annum on chicken meat in supermarkets, fast food outlets, speciality shops and restaurants. The global demand for meat is estimated to increase by 44 per cent to over 400 million tonnes by 2030 to support the world’s growing population and its increased appetite for meat. Poultry’s growth rate is expected to be the highest at 60 per cent, with poultry forecast to make up 39 per cent of worldwide meat demand by 2030 (Attachment 6 – Castlecrest/KDC analysis for GLEF Fund Goulburn Mulwaree Council EOI).

In light of domestic and global demand for poultry it is evident the Woodlands Ridge Poultry facility has the potential to be a critical driver in achieving NSW investment targets.

Economic Development Strategy for Regional NSW

Goal 1: Promote key regional sectors and regional competitiveness

The proposal will directly facilitate the foundation of two businesses in the Common St sub-precinct (Woodlands Ridge Poultry and Advanced Precast) which reflect the regional specialisations identified by the Southern Tablelands Regional Economic Development Strategy, Meat Manufacturing (established specialisation) and Building Products (emerging specialisation).

Goal 2: Drive regional employment and regional business growth

The Woodlands Ridge Poultry development proposed for 52 Sinclair St will alone deliver 150 jobs in the region, reflecting an estimated $6M in wages and a direct and multiplier effect of the facility’s operating budget (estimated as $14M, exclusive of wages) on the regional economy of $36.2M annually (see Castlecrest analysis included in section 2.4). Further analysis of the total forecast economic impact of the Common St sub-precinct is included in Section 2.

Goal 3: Invest in economic infrastructure and connectivity

The proposal delivers heavy vehicle access in close proximity to the Hume Highway to an area identified by GMELS as a key area for industrial development in the LGA; in addition to providing water, sewer and stormwater infrastructure sufficient to meet industrial requirements.

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Regional Development Framework

Program 3: Identifies and activates economic potential by looking across regional NSW for opportunities to change the economic outlook and activate local economies

The proposal aligns with the recommendations of GMELS and will enable new investment in sectors of industry specialisation identified by the Southern Tablelands Regional Economic Development Strategy.

Southeast and Tablelands Regional Plan 2036

The Southeast and Tablelands Regional Plan (STRP) outlines an integrated region in New South Wales with Canberra at its heart, covering the regional centres of Queanbeyan, Cooma, Young, Bega, Batemans Bay, Goulburn and Moss Vale. The plan has four goals, the most relevant to this proposal being a connected and prosperous economy.

A connected and prosperous economy

Agriculture and freight and logistics have been identified as priority growth sectors for the South East area.

Direction 1 of this goal is to leverage access to the global gateway of Canberra Airport. The region aims to look away from Kingsford Smith to Canberra as the gateway to accessing international markets, particularly Asia, through air freight. Part of this involves improving freight routes from NSW agricultural centres.

By establishing an industrial site capable of food processing with B-double suited access to the Hume Hwy, Goulburn will create an optimal location for premium food produce for international export. Fresh food products processed at the Common Street site can reach Canberra Airport in approximately one hour.

Direction 4 is to leverage growth opportunities from Western Sydney. As Western Sydney grows in population and the airport is established, the South East and Tablelands will be promoted as an affordable place for relocation and expansion of Western Sydney based industries. The Common Street project will do this, providing a source of affordable industrial land suitable for a range of industrial uses at a much lower cost than Western Sydney, but with access to Western Sydney via the Hume in less than two hours.

Direction 5 is to promote agricultural innovation, sustainability and value-add opportunities. Before the Common Street site is even established, it has been identified by Woodlands Ridge Poultry as an ideal site for a chicken processing plant. With the proposed development, the Common Street site could support agricultural value-adding for produce grown or raised in the region, and ensure it can be delivered quickly and cheaply to Australia’s capitals and for export overseas.

Direction 11 is to enhance strategic transport links to support economic growth. In line with Transport for NSW’s Fixing Country Roads program. Goulburn is identified as a Strategic Centre, due to its proximity to the Hume Highway and Canberra Airport. The Common Street project addresses this direction by upgrading a key regional and local road for B-double access to Sydney and Canberra via the Hume Hwy.

Direction 12 is to focus new employment opportunities on existing regional centres, through the use of flexible planning controls. Rezoning the Common Street site will allow for new employment opportunities close enough to Goulburn to allow local residents to access employment opportunities, but far enough away to minimise negative externalities on the town.

Canberra Sydney Corridor Regional Strategy 2026-2031

The Sydney–Canberra Corridor Regional Strategy applies to the local government areas of Wingecarribee, Goulburn Mulwaree, Upper Lachlan, Yass Valley, Palerang and Queanbeyan. It identifies the significance of the corridor between Canberra and Sydney, the two largest cities in the southeast of New South Wales, and the extent to which they can service the surrounding regional areas. It incorporates the infrastructure requirements identified in the State Infrastructure Strategy 2008-09 to 2017-18.

The key aim of relevance to this project is:

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“Ensure an adequate supply of land to support economic growth and provide capacity to accommodate a projected 27,800 new jobs, particularly in the areas of manufacturing, transport and logistics, business services, health, aged care and tourism” (page 13).

Southern Tablelands Regional Economic Development Strategy 2018-2022 DRAFT

This document sets out a long-term economic vision and associated strategy for Goulburn-Mulwaree, Upper Lachlan and Yass Valley Councils.

It identifies that the future of individual regional economies is linked to their natural endowments and that attempts to retain industries or establish industries without an underpinning endowment are unlikely to succeed. The region’s agricultural production and affordable land are considered to be key endowments.

The Strategy also identifies the region’s competitive advantages based on its existing industry specialisations. Meat and Meat Product Manufacturing is a regional specialisation, as it is linked to the region’s natural endowments and is a main export industry.

One of five recommendations of the Strategy is to sustain the region’s agriculture and agricultural processing advantage, especially in livestock. Infrastructure priorities for this recommendation are to upgrade road transport infrastructure and to develop a poultry industry development strategy.

The Strategy also recommends to drive growth in the transport access and logistics sector, which will require improving Hume Highway access to facilitate the development of new industrial estates in Goulburn and Marulan and ensuring appropriately zoned employment lands are available to accommodate business.

This proposal directly addresses both of these recommendations, by supporting establishment of a new manufacturing facility associated with the region’s poultry production specialisation; and improving zoning and accessibility to meet a demonstrated need for serviced, general industrial land in the LGA.

Tablelands Regional Community Strategic Plan 2016-2036

The proposal relates to the priorities of the Plan to:

- Support and foster conditions that enable local…businesses to grow (Our Economy, Strategy EC3).

- Foster and develop a diverse, adaptive and innovative agricultural industry (Our Economy, Strategy EC4).

- Maintain and improve road infrastructure and connectivity (Our Infrastructure, IN3).

Goulburn Mulwaree Council Employment Land Strategy 2016

The Strategy recommends the area bounded by Sinclair, Chiswick and Common Sts and the Waste Management Facility to the east should be rezoned to IN1 General Industrial; and that GMC should investigate the feasibility of improved access and connectivity within the precinct to support existing and/or future industry. This Business Case examines the extent to which implementing these recommendations will deliver favourable outcomes for the economy of Goulburn.

Each of the regional plans considered identifies the importance of promoting regional economic growth in existing centres and employment in towns that have lower economic growth than capital cities. They emphasise the importance of transport linkages between jobs, people and markets, particularly for export.

The Common St project recognises these needs through:

§ B-double access to a major freight arterial road, within an hour of international freight flights;

§ Providing employment opportunities in a regional centre that has lower incomes than average; and

§ Providing low cost industrial land close to existing capital cities and creating new sites for industrial uses as businesses get priced out of capital city land.

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2.4 EXPECTED OUTCOMES This project has been developed to unlock the economic potential of an otherwise underutilised but significant precinct of employment land, delivering new private sector investment in capital construction and a long term economic benefit from increased business operations in the region and NSW.

In the immediate term, by supporting this proposal the New South Wales State Government has the opportunity to secure an estimated $110M of private sector capital investment and 180FTE jobs via two foundation developments established as a direct outcome of investing $7.15M in infrastructure.

The assessment below quantifies the construction and operational phase employment and economic benefit of the Woodlands Ridge Poultry development, proposed for 52 Sinclair St. The Woodlands Ridge Poultry proposal reflects a major extension of operations for this local company currently engaged in poultry production; with the proposed $90M development at 52 Sinclair St facilitating poultry processing as well as cold storage and distribution. The company is currently seeking Secretary Environmental Assessment Requirements (SEARS) as part of the Department of Planning and Environment State Significant Development process and has briefed a New South Wales interagency committee regarding their intentions. Woodlands Ridge Poultry is a serious proponent which has put considerable time and effort into early-stage consultation and securing interagency, Council, RDA and political support for its proposal, however its ability to proceed will ultimately depend on the viability of the identified site at 52 Sinclair St from a planning and economic perspective. In an environment where the NSW State Government is offering funding to facilitate projects which provide ongoing employment and economic benefits to the regions, the Woodlands Ridge Poultry proposal alone justifies public investment in legitimate planning realignment and development of appropriate public infrastructure at south Common St, however the infrastructure created will also have the potential to activate further economic investment in the precinct, such as that proposed by Advanced Precast. The analysis below (supported by evidence of business interest in the area detailed in Section 2.2) conservatively estimates the economic benefit of developments additional to Woodlands Ridge Poultry proceeding in the Common St precinct, should the proposal secure grant funding.

The following quantitative analysis of the potential economic impact of the proposal has been prepared by Castlecrest and KDC (Attachment 6 - Castlecrest /KDC Analysis for GLEF Goulburn Mulwaree Council EOI).

Construction base impacts of the Poultry Processing Facility

Woodlands Ridge Poultry has developed plans for the site that show a gross floor area in the order of 32,800 m2. This represents a net building area of 40% of the gross lot area and is consistent with planning provisions and the reality of food processing and manufacturing construction in NSW. Table 1 provides an estimation of the construction value of the facility. Using industry benchmarks (BMT and Cordells) the facility is valued at between $50 and $100 million. Given the construction is estimated to be 60% high (cold storage and process) and 40% low, a figure of $80m is considered reasonable. This calculation is verified by the proponent’s QS estimates of $70 to $90 million.

Table 1 (below): area and estimated value of the proposed poultry processing facility

Gross site area

Net building area 40% gross lot area m2

Construction cost building rate per m2

High and Low

Total estimated building construction cost millions$

Estimated car park and landscaping area

Construction cost parking and land scaping rate per m2

Total estimated building construction cost Millions$

Total facility construction cost

8.2ha 32,800 $3,000 $98.4 10,000m2 $170 $1.7m $100.0

32,800 $1,500 $49.2 10,000m2 $120 $1.2 $50.4

Source: Castlecrest, Cordell, BMT and KDC 2018

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Table 2 shows the economic contribution from the construction phase of the poultry processing facility for both a low-end construction value of $70 million and a high-end construction value estimate of $90 million. The total economic output generated by the construction phase of the poultry processing facility is between $200.62 million and $257.94 million.

Table 2 (below): Contribution to the economy from construction phase of poultry processing facility

Direct Effects

$m

Production Induced Effects Consumption Induced Effects

$m Total $m First Round Effects

$m Industrial Support Effects $m

Output multipliers 1.00 0.466 0.438 0.962 2.866

Output ($70 million) 70 32.62 30.66 67.34 200.62

Output ($90 million) 90 41.94 39.42 86.58 257.94

Sources: Australian National Accounts: Input-Output Tables 1996-97 (5209.0), Price Index of the Output of the Building Industry - Producer Price Indexes (6427.0), CPI All Groups - RBA Bulletin (Table G2)

Table 3 shows the direct and multiplier impacts on employment of the proposed poultry processing facility valued at $70 and $90 million respectively. The direct and flow on employment impact ranges between 2,590 and 3,330 equivalent full-time positions on an annual basis during the construction phase.

Table 3 (below): Construction multiplier effect on employment - $70 and $90m capital investment

Effects Direct

Production Induced Effects

Consumption Induced Effects Total EFT First Round

Effects Industrial Support Effects

Multipliers 9 3 4 21 37

Total job years created $70 m 630 210 280 1,470 2,590

Total job years created $90 m 810 270 360 1,980 3,330

Source: ABS Australian National Accounts: Input-Output Tables 1996-1997 (ABS Pub: 5209.0)

Operational Phase Impacts of the Poultry Processing Facility

Table 4 indicates the employee yields per square metre of floor space derived from a range of similar projects across the Hunter and Coonawarra regions. Based on this data and input from the proponent and using an estimate of one job per 200 m2, the likely number of staff employed in the proposed facility can be calculated. The estimated operational floorspace of 32,800m2 has the potential to accommodate 164 employees. The proponent’s estimate of workforce is 150 FTE. This figure is considered to be conservative and doesn’t account for ancillary and child care staff. However, for the purposes of this analysis 150 FTE staff will be used.

Table 4 (below): Employee yields industrial lands

Description Employees per hectare Workspace ratio

m2 per employee

Large, Low intensity Less than 10 400

General, light industrial 10-20 200-400

Small Unit industrial 20-30 135-200

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Urban services, retail support 25-40 100-160

Source: Castlecrest and KDC 2018

Table 5 uses the equivalent full-time position estimate of 150 to calculate an annual wages cost and impact on the local economy of $6 million and a direct and multiplier impact of $15.66 million annually based on a conservative multiplier of 2.61 (ABS).

Table 5 (below): Estimated annual wages impact and multiplier impacts

Number staff EFT Average annual salary

(unskilled, technical, professional) Total annual wages cost

Estimated multiplier impact of wages 2.61

150 $40,000 pa $6.0 million $15.66 million

Source: Castlecrest and KDC 2018, based on 2016 ABS Census for Goulburn Mulwaree and https://www.payscale.com/research/AU/Job=Production_Worker/Hourly_Rate

Table 6 presents direct and multiplier impacts in terms of output and jobs for the proposed facility’s total operating budget (minus wages). Labour is typically 30% of operating costs which projects a total operating cost in the order of $20m pa. and wages input spending at $14 million. The direct and multiplier impacts on output of $14 million operating budget (minus wages) is $36.26 million annually.

Table 6 (below): Calculation of annual operating cost and multiplier impacts on economic outputs

Annual wages approx. 30% of total operating costs

Non-wage operating costs

Total operating costs

Direct and multiplier Output impact based on $14m 2.59

Direct and multiplier Jobs impacts 3.81

$6 m $14.0 m $20 m $36.26 m 53.34

Source: Castlecrest and ABC Input output tables

Wider area impacts

As already indicated investment in roads, water, drainage and sewerage infrastructure within the precinct will not only facilitate the construction of the poultry processing facility in the immediate future but will also provide the capacity and incentives to attract other capital and ongoing manufacturing and processing operations. This will be achieved through the provision of affordable, accessible, well serviced and well located land as well as the processes of agglomeration and the catalytic effect of a major anchor such as a poultry processing facility. Such a facility will help attract up and downstream suppliers and vertically integrated businesses, businesses working for the same cluster of employment and infrastructure services and businesses that can leverage valuable economies of scale in the poultry processing facilities proposed. GMC and the proponent are actively seeking out these opportunities with the support of RDA and Industry New South Wales.

Using a metric of 50% take-up rate of potential sites (which is considered conservative) and the metric of net building area 40% of gross site area, Table 7 indicates that the project area of 64 ha as the potential to deliver 112,000 m² of building area with the potential value of $168 million.

Table 7 (below): Construction impacts of the wider 64 ha site

Area impacted by project

Net area less poultry facility

Take up rate 50% Nett building area potential 40%

Low construction rate per m2

$1,500 m2

64 ha 56 ha 28 ha 112,000 m2 $168,000,000

Table 8 shows the contribution to the economy of the long-term development of 112,000 m² of processing and manufacturing building area in the project precinct. Table 8 indicates a combined direct and multiplier

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impact on the New South Wales economy in the order of $481.49M at the point where 50% of the overall precinct is developed. At an estimated take-up rate of 8 to 10 ha per proposal every 5 to 7 years the project could achieve this threshold between 15 and 20 years.

Table 8 (below): Contribution to the economy construction phase of $168M of capital development

Direct Effects

Production Induced Effects Consumption Induced Effects

Total

$ million First Round Effects

Industrial Support Effects

Output multipliers 1.00 0.466 0.438 0.962 2.866

Output ($168 million) 168 78.29 73.58 161.62 481.49

Using the established methodology Table 9 indicates construction impact of developing an additional112,000m2 processing and manufacturing building area would have a long-term employment impact in the order of 6,216 FTE over the construction period.

Table 9 (below): Construction multiplier effect on employment - $168m capital investment

Effects Direct

Production Induced Effects

Consumption Induced Effects Total First Round

Effects Industrial Support Effects

Multipliers 9 3 4 21 37

Total EFT for 1 year 1,512 504 672 3,528 6,216

Further capital development would result in a direct construction employment impact of 1,512 jobs and combined direct and multiplier employment of 6,216 construction phase jobs (621 pa over ten years).

Based on additional 112,000m2 @ 1 job for every 200 m2 this new space could accommodate 560 ongoing jobs. With average annual wages estimated at $40,000 per employee (which is considered conservative) this equates to additional wages of $22.4 million annually. There would also be direct and flow on impacts from non-wages operational spending.

As demonstrated, the provision of basic industrial infrastructure in this location with regional and state significance and evidenced demand, but which is failing to deliver industrial amenity and services, will allow it to accommodate substantial new investment.

The proposal will also result in the following savings and revenue opportunities. As the economic case for the proposal is considered to be evident, these ancillary benefits have not been quantified:

- Reduced unemployment payments.

- Increase in poultry production increasing export potential an additional 1,000,000 birds per year.

- Increased opportunities to grow more birds for processing.

- Flow on reputational and trade skills benefits for local residents and other food processing industries.

- Potential to develop a cluster around poultry and other processing technologies, skills and markets.

- Reduced outmigration of young and low skilled workers.

- Opportunities for downstream processing and recycling industries.

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2.5 STAKEHOLDER & COMMUNITY SUPPORT The proposal has been developed in response to recommendations contained in GMELS, which was commissioned by Goulburn Mulwaree Council to:

- Assess the availability and demand for employment lands;

- Identify the drivers for economic growth and emerging industries;

- Establish a strategy upon which to consider future amendments to the Goulburn Mulwaree Local Environmental Plan 2009 and the Goulburn Mulwaree Development Control Plan 2009; and

- Provide analysis to support Council’s marketing, economic development and grant funding objectives.

A Stakeholder Engagement Plan was developed in association with development of the Strategy.

Relevant to this proposal, the pre-consultation phase of the Strategy identified rural industries including poultry as a regional specialisation and sustainable building as an emerging industry. It also identified as a challenge to development the S94 and S64 developer contribution schemes applicable to Common St and other sites in Goulburn. Pre-consultation also identified a surplus of light industrial and deficit of heavy industrial land, and that constraints such as contribution schemes limited the potential of Common St to be utilised to meet the demand for industrial land within the LGA.

In the consultation period post-publication of the draft Strategy a number of submissions were received from landowners in the vicinity of Common St. Advanced Precast, owner of 5 Common St, identified the inhibiting nature of the current B6 zoning and noted that when the company had purchased the land it had been zoned for heavy industry. A DA submitted by the company for establishment of a manufacturing facility for six-star-green-rated recycled building panels and blocks on the site at the time the Strategy was being prepared has since been withdrawn, following advice from Council planning staff that it was unlikely to be approved under the current B6 zoning. The investment required by the developer contribution scheme for Common St was also cited as a factor in the decision to withdraw the DA. A letter of support from Advanced Precast regarding their commitment to development of a manufacturing facility at 5 Common St if the area is rezoned to allow general industrial activity is provided as Attachment 4 – Advanced Precast Letter of Support.

Two further submissions from Common St landowners supported rezoning the area as residential land. For one submission this was principally due to a perceived lack of demand for employment land in the area, which may be related to the structural issues identified above (ie zoning issues and Developer Contribution Schemes). One submission noted access issues off Sydney Road as a factor making the area unsuitable for industrial use. Due to the land’s proximity to the Goulburn Waste Management Centre, Hill PDA Consulting did not support the proposed residential rezoning and confirmed the recommendations they had made in the Strategy relevant to the Common St area (ie that it should be rezoned for industrial uses).

An important stakeholder not specifically captured in the analysis above is Woodlands Ridge Poultry, which, as noted earlier in this submission, has an existing poultry farming business in the LGA and has been consulting with GMC and NSW State Government authorities regarding a proposal to establish a cold storage and distribution centre, poultry processing plant, childcare facility and other associated infrastructure at 52 Sinclair St (land accessible from Common St). The scale and nature of this proposal brings it within the State Significant Development planning processes. Further information about the proposed Woodlands Ridge Poultry development is included as Attachment 3 - Common St Poultry Processing Facility, KDC for Woodlands Ridge Poultry.

Should grant funding be forthcoming, further public consultation will be required regarding the Planning Proposal for rezoning the area.

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3 ANALYSIS OF THE PROPOSAL

3.1 OBJECTIVES & INDICATORS In line with the Growing Local Economies Fund guidelines, the principal benefits of the proposal are increased employment and economic output in the region and the State. Independent analysis has identified underperforming employment land in the LGA in which firm business interest can be demonstrated, subject to favourable business conditions being secured. A relatively small investment in planning realignment and development of public infrastructure to support industrial uses at south Common Street will result in significant and ongoing economic benefit, as demonstrated in Section 2.4.

The measures on which the success of the project will be assessed are detailed below.

Table 3.1: Proposal objectives

Key problem/issue Key proposal objective Key success indictor

Remove identified barriers to business investment in the LGA

Act upon the recommendations of the GMELS to unlock land in the south Common St precinct for business investment by:

- Rezoning to IN1 - Improving accessibility, by

facilitating heavy vehicle movements

- Improving connectivity, by provision of services at the level required by industry

Rezoning achieved by amendment to Goulburn Mulwaree Local Environment Plan 2009 Sydney Rd and Common St intersection and key roads within the sub-precinct allow B-double access Water, sewerage and stormwater services available in the precinct at a level sufficient for industrial activities One new industrial facility established in the south Common Street precinct within 5 years of completion of the proposed works

Increase the value of the local, regional and State economy

Secure new business investment in the south Common St sub-precinct which adds to the economic output of the region and the State Implement actions of the Southern Tablelands Regional Economic Development Strategy (STREDS) to facilitate new business opportunities aligned with regional capabilities and specialisations Support the establishment of new businesses which align with the strategic planning objectives of the LGA and NSW State Government and the Tablelands Regional Community Strategic Plan 2036

As the proposal is centred on generating economic investment in a specific location, it will be possible to identify particular businesses established and industry sectors/sub-sectors affected. The impact of those businesses on the regional economy will be measured by an increase in the value of GRP in the relevant industry sectors and the extent to which it exceeds the average growth in GRP across the LGA To align with STREDS, GMC will target GRP growth in sectors identified as regional specialisations in the STREDS at a level which exceeds the average growth in GRP across the LGA. Growth in registered businesses in the LGA in the targeted sectors will also provide a metric for reviewing this outcome GMC will provide an efficient planning pathway for compliant business proposals, which will be measured by reviewing relevant applications within the statutory timeframes

Increase employment opportunities in the LGA

Secure new business investment in the LGA which provides ongoing employment opportunities for residents of the region Support population growth in the region by growing and diversifying the available employment opportunities

Growth in FTE employment in the LGA within 5 years of delivery of the proposed infrastructure, in excess of the NSW regional average

Create employment opportunities targeted to the demographics of the population of the LGA

Recognise the need for low and unskilled employment opportunities in the region, as well as the need for a diverse range of employment opportunities to facilitate ongoing population growth

Increased diversification of the characteristics of local workers and employment, including hours worked, qualifications and age structure

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3.2 THE BASE CASE The base case assumes that Common St will remain unchanged and manufacturers interested in the area will pursue rezoning of single sites and pay for the supporting public infrastructure themselves, or identify more accessible sites and more favourable conditions in other LGAs, or other states.

3.3 OTHER OPTIONS CONSIDERED An overview of other precincts zoned for industrial development in the vicinity of Goulburn city and the opportunities and limitations of each has been included in Section 2.2.

The precinct offering the best alternative to south Common Street for general industrial development is the area around Ducks Lane (part of the South Goulburn Industrial Precinct, identified within GMELS). The advantage of this area is that it is close to the south Goulburn Hume Highway interchange, which facilitates road access south to Canberra as well as north to Sydney, without travelling through Goulburn city.

Alternative site: Ducks Lane

However, although it is close to the south Goulburn Hume Highway interchange, access to the Highway is via a congested traffic area around the intersection of Sowerby and Hume Streets, and a significant investment in road infrastructure would also be required at this site in order to facilitate an increase in heavy vehicle movements.

Additionally, the industrial land on Ducks Lane is too close to residential uses for the kinds of developments that have been proposed for Common St (Woodlands Ridge Poultry/Advanced Precast). These developments would be unlikely to be approved for IN1 zoned sites on Ducks Lane, as they would cause a reduction in amenity to surrounding rural residential homes, from smells and noise. This perceived dis-amenity would result in local opposition to the redevelopment and greatly limit its use as an industrial site.

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3.4 INFORMATION ABOUT THE PROPOSAL 3.4.1 SCOPE OF WORKS

The proposal centres on the area around Common St, south of Sydney Rd, in the Goulburn Mulwaree Council LGA (see map at left).

GMELS identifies an area of employment lands in this location as the North East Goulburn Enterprise Corridor and this proposal concerns the Sydney Rd and Common St Sub-precincts within this area (see map below left – dark blue and bright green areas).

The sub-precincts are currently principally zoned B6 – Enterprise Corridor and contain a significant supply of Goulburn’s vacant enterprise land. Their proximity to the Goulburn Waste Management Centre (100 Sinclair St), with which any adjacent land use must be compatible and the north Goulburn Hume Highway interchange, make the area a good location for industries that are seeking sites away from residential land use.

Above left: General location of Common St indicated by red pin. Left: North East Goulburn Enterprise Corridor Precinct - Map of Sub-precincts. This proposal relates to the Sydney Road and Common St Enterprise Corridor Sub-precincts.

In line with the recommendations of GMELS to unlock the economic potential of the land in these sub-precincts, the proposal will deliver the following infrastructure and outcomes:

Rezoning

- Rezoning areas within the identified sub-precincts currently zoned B6 Enterprise Corridor to IN1 General Industrial (ie blue areas within the red outline on the precinct map below).

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23

New Traffic Signal Intersection, corner Sydney Rd and Common St

- Subject to further negotiation with RMS, the proposal will construct EITHER a two lane roundabout OR a traffic signal intersection, to facilitate access by vehicles up to and including B-double classification.

South Common St road enhancements

- Construct 12m width asphalt carriageway; 1150m, including turning lane access to 52 Sinclair St.

- Construct kerb & guttering, 2300m.

- Construct B-double capacity turning head located at corner of Common St and Chiswick St.

- Construct stormwater drainage, 1150m.

East Sinclair St road enhancements

- Construct 9m width asphalt carriageway; 418m.

- Construct kerb & guttering, 560m.

- Construct stormwater drainage, 1150m.

Facility for Future Services

- Excavate and lay along Common St and Sinclair St (1568m) conduit facilitating the future extension of communication, electrical and gas services to the area.

Water and Sewerage Upgrades

- Excavate and lay new water reticulation Common St and Sinclair St (750m).

- Supply and construct new water pumping station (designed to meet the pressure and flow demands of an industrial sub-division including the minimum fire-fighting requirements specified under AS2419).

- Excavate and lay new sewer reticulation (1250m, 225mm diameter to facilitate large flows from commercial and industrial activities, in accordance with the Water Services Association Gravity Sewer Code WSA 02-2014).

- Excavate and lay new sewer rising main (450m).

- Upgrade existing sewer pumping station.

Land Acquisition

The road treatment at the corner of Sydney Road and Common St and construction of the turning head at the southern end of Common St will require some land acquisition, which has been included in the detailed budget provided as Attachment 7 – Project Budget. This is an estimate only and subject to quantification following completion of the detailed design process.

The scope of works also includes investigation and design, consultation, project management and a project contingency, further details of which are specified in the detailed costing (Attachment 7 – Project Budget).

Concepts designs for the infrastructure elements of the proposal have been provided as Attachment 8 – Common St Infrastructure Concept Designs.

3.4.2 PROPOSAL EXCLUSIONS

As noted above, the scope of the proposal includes installation of conduit to facilitate future extension of high voltage power, gas and communications services to the precinct but does not include the cost of extension of these services.

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The Goulburn Mulwaree Development Control Plan 2009 identifies drainage affected areas within the precinct to which this proposal applies but this does not limit the area identified as developable land, which is as defined in this proposal (see Attachment 9 – Goulburn Mulwaree Development Control Plan 2009 Extract, p280).

3.4.3 RELATED PROJECTS

The proposal is dependent on rezoning the proposal site from its current B6 Enterprise Corridor zoning to IN1, General Industrial. This will involve development of a Planning Proposal to amend the Goulburn Mulwaree Local Environment Plan 2009, which must be approved by Goulburn Mulwaree Council and the NSW Department of Planning and Environment and is subject to community consultation processes. As reflected in the proposal program provided (Attachment 10 – Common St Project Gantt Chart), it is expected that this stage of the proposal will take approximately 12 months.

It is currently proposed to rezone all areas identified as B6 Enterprise Corridor within the proposal site (see map page 30) to IN1 General Industrial. The consultation process to be undertaken for the rezoning will provide further insight into the appetite of existing landowners and the broader community for rezoning the smaller blocks between Sydney Road and Sinclair Street to IN1. This area, representing 15.7ha of the total proposal site (with only 8.2ha currently undeveloped or underdeveloped) is currently functioning well to facilitate a mix of compatible uses along a main road (the key purpose of its current B6 Enterprise Corridor zoning), however for the purposes of this application it has been included in the proposed rezoning. It is the view of GMC staff that rezoning the larger blocks along either side of Common St south of Sinclair St has a clear planning rationale, as detailed in GMELS.

3.5 PROJECTED COSTS 3.5.1 PROJECTED CAPITAL COSTS

The cost estimate has been developed by GMC using current market unit rates sourced for similar projects. The estimate has been prepared on the basis that the works specified in the proposal will be completed by contractors. The contractor margin at a rate of 8% has been accommodated within the cost for each item (see detailed cost estimate Attachment 7 – Project Budget).

Project management has been included at 6% of direct costs, which reflects the actual project management costs paid for similar projects completed by GMC.

A formal contingency of 8% of direct costs has been included. This is over and above a component of cost contingency which has been built into each line item.

In the table below escalation has been factored in at 3% pa on the total project cost including contingency.

Table 3.2: Projected capital costs inclusive of contingency ($000s)

Stage

2017

-18

2018

-19

2019

-20

2020

-21

Futu

re

Year

s

Tota

l

Base cost estimate 0 255 3,503 3,519 0 7,277

Contingency 0 51 230 230 0 511

Escalation (3% pa) 0 9 224 337 0 571

Nominal cost 0 315 3,957 4,086 0 8,359

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3.5.2 PROJECTED ONGOING COSTS

Ongoing Costs

An Asset Management and Maintenance Plan for the infrastructure included in this proposal has been provided as Attachment 11.

It provides further details of the asset maintenance and management practice and policy of GMC and forecasts maintenance costs over the 30 year life cycle of the roads infrastructure. Under this analysis the forecast average annual maintenance cost for the road infrastructure is $24,596, which will be funded by GMC as part of its Operational and Delivery Programs.

For the sewer and water infrastructure, the anticipated life cycle of the civil assets is 100 years, the mechanical assets is 30 years and the electrical assets is 30 years. The average, escalated, operating and maintenance costs of the water, sewer and stormwater infrastructure over 30 years is estimated to be $63,433 per annum.

Cost Savings and Revenues

The operating and maintenance costs of the water and sewer infrastructure will be offset by user fees and charges levied under the provisions of the Local Government Act 1993.

Table 3.3: Projected ongoing costs ($000s)

Year

Roa

ds –

m

inor

repa

ir

Roa

ds -

rese

al

Insp

ectio

n

Wat

er a

nd

Sew

er –

op

erat

ion

and

Mai

nten

ance

Tota

l Year 1 (2020/21)

(see total – small pa cost)

40

40

Year 2 41 41

Year 3 42 42

Year 4 44 44

Year 5 5 45 50

Year 6 46 46

Year 7 48 48

Year 8 49 49

Year 9 51 51 Year 10 6 52 58 Year 11 54 54 Year 12 55 55 Year 13 57 57 Year 14 59 59 Year 15 7 61 68 Year 16 62 62 Year 17 64 64 Year 18 66 66 Year 19 346 68 414 Year 20 8 346 70 424

Year 21 72 72 Year 22 74 74 Year 23 77 77 Year 24 79 79

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Year 25 9 81 90 Year 26 84 84 Year 27 86 86

Year 28 89 89 Year 29 92 92 Year 30 10 2 94 106

45 692 2 1,903 2,641

3.6 COST-BENEFIT ANALYSIS The Cost Benefit Analysis below has been prepared by SGS Economics and Planning. The full report is provided as Attachment 5 – SGS Economics and Planning Growing Local Economies Northeast Goulburn Enterprise Corridor Report.

Method

A cost-benefit analysis (CBA) is one method of conducting an economic appraisal, to quantify the marginal costs and benefits when moving from a base case to a project option. Unlike a financial appraisal, which captures financial transactions and is conducted from the perspective of a specific government department, a CBA captures the flow of resources and is conducted from the perspective of the NSW community.

The performance of the project option is evaluated to determine whether it delivers a net community benefit (where benefits outweigh costs) or net community cost (where costs outweigh benefits).

The CBA conducted in this analysis has been done so in line with NSW Treasury (2017) Guidelines. For the purpose of this analysis, the base case assumes that the land is not re-zoned, therefore there is no take-up of the site by any firm. The project option considers the scenario where the site of interest is re-zoned from B6 – Enterprise Corridor to IN1 – General Industrial, as a result of two firms showing interest in establishing a poultry processing plant and a building product manufacturing centre.

Identifying marginal costs and benefits

Marginal costs and benefits when moving from the base case to the project case can be seen in Table 5 below and are quantified in sections 6.3 and 6.4 (Attachment 5 - SGS Economics and Planning Growing Local Economies Northeast Goulburn Enterprise Corridor Report, p19).

Table 5 (below): Marginal costs and benefits

Marginal costs Marginal benefits

Construction costs Land value uplift due to re-zoning

Recurrent and maintenance costs Source: SGS Economics & Planning (2018)

Not quantified

Chapter 3 (Attachment 5 - SGS Economics and Planning Growing Local Economies Northeast Goulburn Enterprise Corridor Report, p14) identified the economic benefits through the creation of full-time employment and direct and indirect impacts to the regional economy. As per NSW Treasury Guidelines (2017, pp.12), only first round impacts should be included, within second round flow on or multiplier effects generally being excluded. For the purposes of estimating the potential economic benefit of the proposal, KDC and Castlecrest identified direct and flow-on benefits separately.

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As will be seen in the following sections, industrial land (IN1 – General Industrial) is significantly higher in price per hectare than land with a B6 – Enterprise Corridor zoning. Industrial land attracts a premium because it allows the manufacturing of goods.

The benefits mentioned in Chapter 3 have been derived through input-output modelling, calculated on the basis of multiplier effects occurring through various industries and processes of production and consumption. Thus, the output of the firm which takes up the site cannot be included, as this has already been captured by the land value uplift. Additionally, the direct output of the firm’s operations would flow back to the firm as profits, therefore would be a private rather than community benefit.

The potential benefits from the establishment of a poultry processing facility have not been included as benefits in the cost benefit analysis.

Quantifying the marginal costs

Capital costs

Capital costs refer to the costs associated with making the site able to accommodate industrial uses, whether this be poultry processing or cement manufacturing or other uses. This includes:

- Upgrading the water and sewerage on Common Street

- Upgrades to Sinclair Street

- Creation of a roundabout or traffic signal intersection on Sydney Road suitable for a B double

- Costs associated with planning and design, including land acquisition

Under the base case, there are no capital costs. The capital costs under the project case are estimated to cost a total of $7,788,082 or a net present value of $6,606,871, using a real discount rate of 7%.

Figure 9 (below): Timing of capital costs

Source: Goulburn Mulwaree Council (2018)

Maintenance and recurrent costs

Both the base case and project case have maintenance costs from water and sewerage and roadwork and design. The major difference between the two however is that under the project case, as a result of the upgraded water and sewerage systems, the operating and maintenance costs increase significantly, with an estimated total operating and maintenance cost for all infrastructure of $88,030 per annum.

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Quantifying the marginal benefits

Land value uplift

The site is currently zoned as B6 – Enterprise Corridor. For a poultry processing plant or cement manufacturing centre to be allowed to manufacture on site, the land must be re-zoned to IN1 – General Industrial. In order to determine the current land value of the site, the value of land zoned as B6 around the site was sampled to determine the average price per hectare of B6 land. The same process was undertaken to determine the value of land zoned as IN1 in Goulburn.

It is assumed that the land value uplift will be realised immediately following re-zoning. The value of the land is independent of what is built upon it, thus the land value uplift has been modelled to occur in 18-19.

The uplift in land value was calculated as follows:

Equation 3 (below): land value uplift

( ) ( )

( )

( )

The values used to determine Equation 3 can be seen in Table 6 below.

Table 6 (below): Values for calculation of equation 3

Variable Assumption IN1 $ 536,046 B6 $ 95,591 Land size 64 hectares Source: SGS Economics and Planning (2018) using NSW Valuer General data

Results

The results of the cost-benefit analysis using a central discount rate of 7% and sensitivity tests of 3% and 10% can be seen in Table 7 below. As can be seen, under both the central BCR and the sensitivity tests, the project case results in a BCR of greater than 1.0. A project is potentially worthwhile if the NPV is positive or the BCR is greater than 1.00 (NSW Treasury, pp. 19).

Table 7 (below): Summary of costs, benefits and performance metrics

Discount Rate Discount Rate Discount Rate Key CBA Results 3% 7% 10% Net Present Value ($m) $ 19,242,542 $ 19,179,299 $ 19,039,653

Benefit Cost Ratio 3.37 3.68 3.89 Present Value of Benefits ($m)

Land value uplift $ 27,368,097 $ 26,344,991 $ 25,626,491 Present Value of Costs ($m)

Capital costs $ 7,246,727 $ 6,606,871 $ 6,180,013

Recurrent and maintenance costs $ 878,829 $ 558,821 $ 406,825

The timing of the costs and benefits can be seen in Figure 10 below.

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Figure 10 (below): Costs, benefits and net benefits

Source: SGS Economics and Planning (2018)

Sensitivity analysis

The results of an investment can vary significantly if assumptions around costs and benefits are substantially higher or lower than expected. For this reason, we have tested the results under two alternative assumptions:

§ Total capital costs 50% higher than expected

§ A fall in price of industrial land by 20%

Table 8 (below): Sensitivity analysis – higher capital costs and lower industrial land prices

Discount Rate Discount Rate Discount Rate Key CBA Results 3% 7% 10% Net Present Value ($m) $8,957,630 $9,463,345 $9,712,014

Benefit Cost Ratio 1.76 1.90 2.00 Present Value of Benefits ($m)

Land value uplift $20,706,549 $19,932,472 $19,388,859 Present Value of Costs ($m)

Capital costs $10,870,090 $9,910,306 $9,270,020

Recurrent and maintenance costs $878,829 $ 558,821 $406,825

Under these more conservative assumptions, the Common Street investments still produce a positive return, with a benefit cost ratio of 1.90 at a 7% discount rate and a net present value of $9.5 million.

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3.7 FINANCIAL APPRAISAL Capital Expenditure

The capital expenditure cashflow has been detailed in Table 3.1. The proposal will be funded with a Growing Local Economies grant of $7.15M and a contribution of $638,082 from Goulburn Mulwaree Council.

Operating and Maintenance Expenditure

The ongoing operating and maintenance expenditure cashflow is detailed in Table 3.2. An Asset Management and Maintenance Plan has been included as Attachment 11, which provides further detail regarding the asset maintenance cycle, including periodic inspections and minor and major repairs.

GMC funds its asset maintenance and renewal works in its annual budgets based on works programs developed based on a number of criteria. Funds for these works are contained within the organisational business unit to which responsibility for that class of asset belongs.

Pending the approval of grant funding, the forward asset management and maintenance estimates contained in this report will be incorporated into the GMC four year Operational Program and annual Delivery Plan, for adoption by Council.

Capital Revenue

The following developer contribution schemes apply to developments at the proposal site:

S94, Environmental Planning and Assessment Act 1979 - A Section 94 Contributions Plan enables a Council, pursuant to Section 94 of the Environmental Planning and Assessment Act 1979, to require a developer to make a contribution towards the provision, extension or augmentation of public infrastructure, amenities and services that will, or are likely to be, required as a consequence of certain development.

The Goulburn Mulwaree Section 94 Development Contributions Plan 2009 can apply to applications for new detached housing (including low and medium density residential development), commercial development and industrial development on previously undeveloped land.

Developer Servicing Plans for water supply, sewerage and stormwater - required from developers under S64 of the Local Government Act 1993 and Section 307 of Division 5 of Part 2 of Chapter 6 of the Water Management Act 2001. In November 2017 Goulburn Mulwaree Council adopted a new Developer Servicing Plan for water supply, sewerage and stormwater services for the local government area.

To the extent that the developer contribution schemes referred to above cover the same infrastructure as that specified in the scope of this proposal, contributions will not be claimed for this infrastructure under the schemes.

Operating Revenue

The operating and maintenance costs of water and sewer infrastructure created under the proposal will be wholly offset by user fees and charges levied under the provisions of the Local Government Act 1993.

3.8 PROPOSED FUNDING ARRANGEMENTS Capital Costs

GMC’s project funding of $638,082 will be allocated from contributions collected under the Goulburn Mulwaree Development Servicing Plan for Water Supply, Sewerage and Stormwater.

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Ongoing Costs

Ongoing costs associated with the proposal infrastructure have been estimated and detailed in Attachment 11 - Asset Management and Maintenance Plan, and will be funded by GMC as part of its annual Operational Program.

Table 3.4: Proposed capital funding contributions ($000s)

Stage

2017

-18

2018

-19

2019

-20

2020

-21

2021

-22

Rem

aini

ng

Year

s

Tota

l

Proposal capital costs 0 306 3,733 3,749 0 N/A 7,788

Funding sources

NSW Government (subject of this request) 0 0 3,401 3,749 0 N/A 7,150

Council contributions 0 306 332 0 0 N/A 638

Industry contributions

Community contributions

Other government contributions

Other funding sources (please detail)

Sub-total 0 306 3,733 3,749 0 N/A 7,788

3.9 FINANCIAL HEALTH & SUPPORT The principal proponent of the project is Goulburn Mulwaree Council, a body politic of NSW, Australia – being constituted as a local government area by proclamation and duly empowered by the Local Government Act 1993 (LGA).

GMC’s audited financial statements for FY1617, FY1516 and FY1415 have been provided as Attachment 12.

As evidenced by Attachment 12 – Audited Financial Statements, in FY1617 GMC had turnover of $81.7M and a net operating result before capital of $18.9M, or $1.2M before grants and contributions provided for capital purposes.

At 30 June 2017 GMC recorded an Unrestricted Current ratio of 3.56:1 which indicates an extremely strong ability to meet its current obligations as they fall due.

GMC also manages its investments to ensure that cash is available at all times when there are payments due. This will ensure that the cashflows listed above (Section 3.8) can be closely managed between the receipt of funds under the grant funding program.

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4 IMPLEMENTATION CASE 4.1 PROGRAM & MILESTONES To guide development of the proposal, GMC has referenced the findings of independent reports such as GMELS and Southern Tablelands Regional Economic development Strategy and commissioned consultants to determine the potential economic benefit and Cost Benefit Ratio. Concept designs (Attachment 8 – Common St Infrastructure Concept Designs) and detailed costings (Attachment 7 – Project Budget) have been prepared, in addition to a Project Management Plan (Attachment 13 – Project Management Plan), Risk Management Plan (Attachment 14 – Risk Management Plan) and Asset Management and Maintenance Plan (Attachment 11 – Asset Management and Maintenance Plan). These are dynamic documents which will continue to be updated as the proposal progresses.

Subject to confirmation of grant funding, it is proposed to commence the investigation and design phase of the project in February 2019 (which will include commencing activities to achieve the proposed rezoning of the proposal site); with construction activities scheduled to commence in February 2020 and be completed by December 2020.

Gantt charts for both phases of the project have been included as Attachment 10.

Table 4.1 provides an overview of the key project milestones.

Table 4.1: Key events

Event Start Finish

Planning and Design February 2019 July 2019

Rezoning Process – Planning Proposal February 2019 February 2020

Planning Proposal Consultation March 2019 May 2019

Tender Preparation July 2019 September 2019

Land Acquisition July 2019 September 2019

Review and Award Tenders October 2019 November 2019

Finalise documentation and approvals November 2019 January 2020

Site Establishment February 2020 February 2020 Common St road water and stormwater infrastructure works February 2020 October 2020

Sewer main and water pumping station works March 2020 August 2020

Sinclair St road, water and stormwater infrastructure works May 2020 September 2020

Sydney Road traffic signals OR roundabout June 2020 December 2020

4.2 GOVERNANCE A detailed Project Management Plan has been provided as Attachment 13 and a section on Governance Structure is included at pages 15-19. The information below has been extracted from the Plan:

Governance Structure

The following project structure will be implemented for the project:

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Project Initiation

This proposal has been generated in response to a limited-competitive grant funding opportunity presented by the NSW State Government and reflects the recommendations of GMELS (adopted by Council December 2016). The scope of the project as reflected in this Business Case has been endorsed by Council at a meeting on 3 July 2018, subject to grant funding. An independent cost benefit analysis supports the application and verifies the proposal’s economic rationale (see Section 3.6).

Project Control Group

This group has overall control of the project, ensures the project meets it objectives, delivers expected benefits, represents Goulburn Mulwaree Council’s interests and is the key project decision making body.

The PCG will consist of Council’s General Manager, Director of Operations, Director of Corporate and Community Services, Director of Planning and Environment, Business Manager Building and Environment and a representative of the Southern Regional Office of the Department of Premier and Cabinet (subject to confirmation). The PCG will meet monthly to review the project status report, resolve issues and make decisions on non-routine matters. These meetings will be chaired by Council’s General Manager.

Project Sponsor

The Project Sponsor oversees development of the project feasibility and business case and has responsibility for project budget allocation and scope adjustments, as well as resolution of issues escalated to the PCG. This role will be filled by Council’s General Manager.

Service Area Representative

Represents the end user ensuring their needs are specified correctly and the solution meets end user requirements. This role will be filled by Council’s Director Operations.

Project Director

Supports the Project Sponsor through ongoing involvement in the project. Monitors project implementation including day to day management and decision making. Ensures necessary project resources are available and approves the Project Plan. This role will be filled by Council’s Director of Operations.

Project Assurance

Independent review role to assure key project stakeholders their interests are being met throughout the project. This role will be filled by Council’s Director of Corporate and Community Services.

Project Manager

Responsible for day to day management and decision making for the project; reports to the Project Director. Monitors expenditure and progress, ensures project remains within tolerances established by the PCG and ensures project documentation is complete. Also responsible for procurement, contract

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management, supervision of other members of the Project Team and daily Work Health and Safety and Quality Management requirements. This role will be filled by Council’s Business Manager Projects.

Project Team

Responsible for delivery of the project under the supervision of the Project Manager. Monitors compliance with safety, environment & quality management and ensures technical compliance. Identified at the beginning of each project, with team members informed of project scope and individual responsibilities. The project team composition will be representative of size, complexity and the risk profile of individual projects. Participation by individual team members is to be endorsed by the Director.

Reporting

Project reporting provides the overall expectations, advice, guidance and resources for specified projects. The project reporting requirements will differ depending on the project; however will generally consist of:

Project Plan – Provides a high level understanding of the project and identifies key decision and review points.

Summary Report – Prepared each month for the PCG meeting and serves as a snapshot of project status.

Council Report – Prepared on a monthly basis as a status report and for critical decisions requiring Council endorsement.

Project Meetings

The Project Manager will organise regular meetings throughout the implementation phase with the relevant contractor, consultant or representatives of the project team. These meetings will monitor works delivery including health, safety, environmental and technical compliance, quality management, progress against schedule and resolve issues as they arise. The Project Manager will keep records meetings and distribute to all attendees.

Stakeholder Engagement

The goal of the communication strategy is to ensure that all stakeholders are informed in such a way as to achieve the desired outcomes of the project.

Stakeholders

Stakeholders have been identified and include government, business and community organisations and industry and community stakeholders. The list is dynamic and may change throughout the project.

Communication Strategy Methodology – Formal

Following a successful funding outcome, the project information prepared by GMC will be consistent with specifications, funding agreements and Local Government responsibilities. Key aspects of the project will be outlined in clear English and be relevant to the goal of the project. There will be specific emphasis for different stakeholders.

Communication Strategy Methodology – Informal GMC seeks to ensure effective communication and will consider all feedback. A critical focus of the communication strategy will be on early informal discussion with stakeholders so that any issues may be identified while they can easily be addressed.

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4.3 KEY RISKS A detailed Risk Management Plan for the project has been prepared and provided as Attachment 14.

It outlines how all key risks have been identified, assessed and appropriate mitigation or management strategies which will be put into place. It contains a Risk Register developed through a series of project-specific risk meetings conducted in accordance with the requirements of AS/NZS ISO 31000:2009.

Risk mitigation strategies or actions included in the Risk Register are to be implemented at various stages throughout the project to obtain an acceptable risk profile for the project to proceed.

The principal project risks have been included in the table below (those in the Risk Register with a risk after mitigation rating of ‘high’ or greater) and the full risk register for the project is on pages 8-15 of Attachment 14 – Risk Management Plan.

Table 4.2: Key proposal risks (those rated ‘extreme’ prior to mitigation strategies and with a post-mitigation risk of ‘high’)

Risk Proposed mitigation Risk rating after mitigation

Consequence Likelihood Rating

Financial - Land use uptake for industrial use may be under

subscribed

Develop comprehensive business case and marketing strategy and conduct industry

consultation to determine feasibility of proposed development

Major Unlikely

High

Safety – working in and around traffic could result in damage to plant & equipment or injury to

staff or the public

Traffic Control Plan - experienced & qualified staff - notification of public & business - traffic

control devices that comply with AS1742.3 - clear & legible signs - adjust to changing weather

Major Unlikely

High

Operational - poorly defined site causes confusion of pedestrian & traffic movement in and around the site that could result in injury

to members of the public

Traffic Management Plan incorporating TCP - experienced & qualified staff - notification of

public & business - traffic control devices that comply with AS1742.3 - clear & legible signs -

designated access & egress points - designated material storage area

Major Unlikely

High

Environmental – construction works cause environmental

pollution resulting in financial penalty

Prepare REF; comply with local planning requirements; prepare Environmental

Management Plan; consult with environmental regulators; maintain and monitor environmental

controls for duration of works; engage environmental specialist for advice on specific

issues; engage experienced staff and contractors

Major Unlikely High

Safety – working in the vicinity of services causes injury or death

(power lines, water, gas)

DBYD; hydrovac investigation to confirm actual service location before work commences; include

service location on design plans; have service utility representatives attend site; site induction; SWMS; risk assessments; tool box talks; use experienced staff and contractors; appropriate

signs and delineation to indicate locations; use of spotters when working in close proximity

Severe Unlikely High

Financial - working in the vicinity of services causes damage

resulting in extensive repair costs

DBYD -hydrovac investigation to confirm actual service location before commence work - include service location on design plans - have service

utility representatives attend site - site induction - SWMS - risk assessments - tool box talks - use -

experience staff and contractors - appropriate signs & delineation to indicate locations - use of spotters when working within close proximity -

appropriate insurance cover

Major Unlikely

High

Safety – inadequate site safety systems results in injury to staff

or members of the public

Develop WHS Management Plan; TMP, SWMS, risk assessment, tool box talk, plant pre-start inspections, DBYD; hydrovac investigation to confirm actual service location before work

commences; include service location on design plans; use experienced staff and contractors; appropriate signs and delineation to indicate

Major Unlikely High

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locations of hazards; use of spotters when working in close proximity; appropriate insurance cover; develop sound construction methodology

Safety – inappropriate plant selection and use results in injury

or damage to private property and infrastructure

WHS Management Plan; use of experienced and competent plant operators; plant pre-start

checks; TMP & TCP; SWMS; risk assessment; tool box talk; DBYD; site signage & delineation

include marking work exclusion zones; appropriate insurance cover; develop sound

methodology; assessment of compaction techniques near buildings

Severe Unlikely High

Operational – Unknown ground conditions result in time delays

and additional cost

Geotechnical Investigation; indigenous heritage assessment; european heritage assessment;

section 140 permit prior to excavation; investigation excavation; review available records

of nearby works & services

Major Unlikely High

Operational - plant operators are not appropriately skilled or

experienced resulting in damage to underground infrastructure

Use experienced operators - DBYD - hydrovac - obtain underground service locations - review

available plans - maintain safe approach distances - hand excavation close to services

Major Unlikely High

4.4 LEGISLATIVE, REGULATORY ISSUES & APPROVALS Strategic Planning Approval Pathway

Achieving the proposed rezoning of the south Common Street sub-precinct will require preparation and submission of a Planning Proposal. When available this document will be provided to Water NSW for comment, as the proposal site is within the Sydney drinking water catchment area. When comments have been received from Water NSW the Proposal will be submitted to Council for endorsement.

Following endorsement by Council the Planning Proposal will go to the NSW Department of Planning and Environment for a Gateway Determination, which will trigger an amendment to the Goulburn Mulwaree Local Environment Plan 2009. This process may take up to 12 months.

Updates to the Goulburn Mulwaree Development Control Plan 2009 are affected by a resolution of Council.

Infrastructure Works Approval Pathway

The Environmental Planning and Assessment Act 1979 (EP&A Act) outlines the requirements for when and how an activity is to be assessed to ensure the development of land and provision of services is undertaken with the appropriate regard for the potential impacts of the development. Planning of all projects must include provisions to minimise and/or mitigate any potential impact that undertaking the project may cause.

In accordance with the definitions within the EP&A Act this project will be dealt with in accordance Part 5 of the EP&A Act. Part 5 of the EP&A Act is to ensure that public authorities fully consider environmental issues before they undertake or approve activities that don’t require development consent. The preparation of a Review of Environmental Factors (REF) is a mechanism to address the environmental impact assessment requirements for activities subject to Part 5 of the EP&A Act.

The REF will identify environmental impacts relevant to the project including ecology, heritage (European & Aboriginal), character, visual, contamination and traffic. It will also identify suitable controls for inclusion in the Construction Environmental Management Plan that will be prepared prior to works commencing.

Various management plans will be required to be completed by the works contractors, including a Construction Management Plan, WHS Management Plan and Environmental Management Plan. These documents will provide a scheme for completing works to meet legislative and regulatory requirements, as well as the policies and objectives of Goulburn Mulwaree Council and grant funding obligations.

As noted earlier in this document, as some of the proposed works involve a road asset under the management of RMS, further consultation with RMS will be required before confirming the scope of works.

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4.5 PROPOSED MANAGEMENT ACTIVITIES 4.5.1 RISK MANAGEMENT

The project governance structure has been designed to ensure that risk management is specifically addressed within the project management activities.

GMC’s Work Health and Safety Policy (July 2013) commits Council to providing a safe workplace for staff, volunteers, visitors and contractors. For this project, the general principles of AS/NZS ISO 31000 were adopted to carry out a risk management process.

Procurement

A risk assessment will be performed as part of procurement planning to identify risk associated with the various methods of procurement that could be used. The results will be used to select the procurement method for the project. A Procurement Management Plan will be prepared when funding is secured.

Design and Planning

Risk was considered during the concept design and will be further explored through project planning, detailed design and tendering.

Section 22 of the WHS Act 2011 outlines the duty of designers to ensure structures are without risk to the health and safety of those who use, construct, decommission any component and maintain the structure. This is to include project lifecycle and applies to permanent or temporary structures.

This project will include Safety in Design (SiD) workshops where a similar process to that outlined in section 4.3 in developing the Risk Register will be implemented. The findings of each workshop will be presented in a final SiD Report and be incorporated in the design process to follow.

Detailed risk assessment will continue during the detailed design and project implementation phases, with a specific focus on design development. Safety in Design process undertaken during detailed design will also ensure the risks of construction are considered and analysed.

Construction/Delivery

Safety risk throughout construction will be managed by GMC’s contract management system. This includes the requirement to develop a project specific Work Health and Safety Management Plan, which details the systems and procedures which will apply during the term of the contract.

The Safety Management Plan will be reviewed by GMC prior to commencement of the contract and will be subject to approval by Council. The Safety Management Plan will then be reviewed at regular intervals throughout the contract to ensure that it remains current and relevant. The contractor’s Safety Management Plan will also form the basis by which its management systems will be regularly audited by GMC.

Environmental Risk during construction will be managed by an Environmental Management Plan. This outlines how environmental risks are to be managed throughout the construction phase. It will be approved by GMC prior to commencement of works and will undergo an regular auditing process.

4.5.2 ASSET MANAGEMENT & OPERATIONS

All assets developed under the proposal will be public assets under the management of GMC, with the exception of the Sydney Road infrastructure, which will be under the management of RMS.

As detailed earlier in this document, the assets will be incorporated into GMC’s standard processes for inspection and maintenance of assets under its control. The cost of maintenance will be included in the works programs and budgets detailed in cyclical Delivery and Operational programs required to be prepared by Council under the legislated Integrated Planning and Reporting structure for local government.