INDEPENDENT PANEL SLAMS CHRISTCHURCH COUNCIL PLANNERS
4 March 2015
On Thursday 26 February, an important decision was announced by the Christchurch Replacement District Plan Independent Hearings Panel, dealing with the Christchurch City Councils Notified Plan foundation Strategic Directions and Outcomes ( http://www.chchplan.ihp.govt.nz/Hearings/Hearing1/Pages/default.aspx ).
Recently, the Press Senior Feature Writer John McCrone interviewed Sir John Hansen, a former High Court Judge and current Chair of the Christchurch Hearing Panel … Sir John Hansen is a man with a plan . Sir John and the Panel are highly regarded within the wider community.
With respect to housing (s164 onwards) the Panel states the Council’s Notified Plan was “insufficiently clear and directive on the very important subject of housing capacity and choice”.
As noted within the decision, submitters explained the human costs of Christchurch’s stressed and currently severely unaffordable housing market.
S167 states …
‘In the overall sense, that demonstrated relevant provisions of the Notified Version would fail to promote sustainable management. In particular, its Policy 22.214.171.124. referred vaguely and inconsistently to notions of “housing affordability” and “opportunities for affordable housing development … sufficient to meet demand’. Without proper definition or objective or goal” the Notified Version did not provide any helpful measure of the problem or ability to monitor whether the problem was being resolved (through the administration of related Plan provisions, for example).”
The Panel Decision stressed the importance of consistency, clarity and certainty.
In subsequent sections the Decision states the Planning Experts Joint Version “… was much clearer”.
The Planning Experts perspective, however, tends to be prescriptive.
Housing above 3.0 times incomes … structural issues to address …
As the Annual Demographia International Housing Affordability Surveys clearly illustrate, if housing prices exceed 3.0 times annual household incomes, there are impediments to land supply and inappropriate infrastructure financing that need to be dealt with.
As the former Principal Urban Planner of the World Bank, Alain Bertaud, made clear within the Introduction to last year’s Demographia Survey, planners focus must be on affordability and mobility.
Within the Introduction to this years Demographia Survey Professor Shlomo (Solly) Angel, also of the Stern School of New York University with the Bertaud’s, makes clear that as people become more affluent, they require more space. Recent research by Trulia in the United States echo’s this … Trulia Survey: Many Americans Want a Bigger House – US News.
Mr Bertaud with his wife and fellow researcher, Marie Agnes, addressed the Christchurch Council people as part of their comprehensive and most successful 3 City New Zealand speaking tour mid-2014.
Interestingly, it was the economists throughout New Zealand who financed and arranged the Bertaud visit. It was all “too complex” for Local Government New Zealand and the Planning Institute to officially participate !
Significant numbers of their responsible members did participate though.
The market is the appropriate place for decisions on the housing types and volumes required, as planners cannot be expected to have the knowledge , skills and capacity to respond quickly to constantly changing and unpredictable market requirements and conditions.
Just “follow the numbers” …
Price is the only true measure of scarcity or abundance.
It is simply a matter of “following the numbers” to ascertain why new starter fringe housing is currently not being put in place for around $1,000 per square metre ALL UP (serviced section and construction) … as explained by this writer mid 2013 within … Focus on Restoring Housing Affordability … and too … clearly illustrated with the Andrew Atkin THE REAL DEAL poster .
A clear structural definition of an affordable housing market is ….
“For metropolitan areas to rate as ‘affordable’ and ensure that housing bubbles are not triggered, housing prices should not exceed three times gross annual household earnings. To allow this to occur, new starter housing of an acceptable quality to the purchasers, with associated commercial and industrial development, must be allowed to be provided on the urban fringes at 2.5 times the gross annual median household income of that urban market (refer Demographia Survey Schedules for guidance).”
“The critically important Development Ratios for this new fringe starter housing, should be 17 – 23% serviced lot / section cost – the balance the actual housing construction.”
“Ideally through a normal building cycle, the Median Multiple should move from a Floor Multiple of 2.3, through a Swing Multiple of 2.5 to a Ceiling Multiple of 2.7 – to ensure maximum stability and optimal medium and long term performance of the residential construction sector.”
Christchurch housing severely unaffordable …
When housing affordability is restored (Christchurch is currently internationally rated “severely unaffordable” at 6.1 times annual household earnings … refer Demographia Survey), all forms of development benefit, as true land prices are restored.
Apartments and townhouses, for example, are around 70 – 75% of the prices of detached housing in normal or near normal markets, as the latest monthly report of the Houston Association of Realtors clearly illustrates.
Christchurch Council ignores elementary economic analysis …
Within the Christchurch Hearings Panel Decision, Resource Management Act (New Zealand’s land use legislation) Section 32 (economic analysis) issues are dealt with at length ( s71 onwards within Hearings Decision).
It is clear the critically important Resource Management Act Section 32 analysis by the Council planners in inadequate.
S75 of the Independent Panel’s Decision states …
“Insofar as the identified issues go, we accept them as valid for Strategic Directions to address. However neither the Report nor the evidence called by the Council demonstrate the Council to have undertaken any substantive analysis of the issues and how they should inform Strategic Directions. As matters transpired, it was the Crown / CERA who called related substantive and independent evidence on these matters.”
… and states further in s79 …
“Despite that, however, the Report demonstrates a disappointing lack of rigour and thoroughness in the testing of its proposed objectives and policies by what s 32 specifies.”
And too noting in s82 …
“…. However, we find the quality of its evaluations to be poor.”
A damning decision … what are the costs ? …
This is a damning assessment of a seriously dysfunctional Council, with its poor quality governance and costs well out of control.
What is all this play-time planning by the Christchurch City Council bureaucrats costing the citizens of Christchurch ?
What are the lost opportunity costs ?
Not surprisingly, commercial confidence in Christchurch is slumping, as Tess McClure of The Press reported recently … Investors lose confidence in Christchurch .
Property Council … The Christchurch City Councils consultation failure …
Within it’s openning legal submission by its counsel, Ms Lauran Semple of Greenwood Roche Chisnall, the Property Council of New Zealand states in s11 …
“It is for this reason there is some frustration that the Christchurch City Council (Council), until its most recent iterations of the Strategic Directions Chapter has failed to recognise within the provision the important contribution made by the private sector. This is consistent with Mr Thelan’s (Christchurch Councils Chief Planner) evidence that the Council saw no need to consult with the private sector any more or less than any other part of the community in the preparation of the Plan.”
In any event, the Council rarely consulted others in the community, other than engaging in sham consultation exercises. Bluntly … the Christchurch City Council is there solely for the benefit of its bureaucrats … a mirror image of the culture of a London Council, as explained in the UK Daily Mail some years ago … The Great Inertia Sector .
The Christchurch City Council bureaucrats have long been at War with their community and business
The planning horror story … Tony Sewell of Ngai Tahu explains …
At the Independent Hearings, Mr Tony Sewell, Property Manager of Ngai Tahu and former industry leader as National President of the Property Council of New Zealand, was cross-examined by Mr Winchester, the counsel for the Christchurch City Council, about the Councils performance in getting the major and desperately needed Wigram residential development in place.
Tony Sewell responded … outlining the “planning horror story” …
“ … It was a disgrace. It took over 10 years. A piece of land completely surrounded by urban development going nowhere, despite our very stern and strong efforts. I think there were something like 20 Project Managers over the time. A complete lack of consistency right throughout the process. Meanwhile, areas (the adjoining well managed smaller Local Authority areas of Selwyn and Waimakariri) like Rolleston, Rangiora, Kaiapoi boomed, while people in Christchurch cried out for somewhere to live.”
“So if that gives a small view of our relationship with the Christchurch City Council and their complete non-performance, that might give you a bit of an answer. That’s just a small picture.”
“I will never repeat the process again in my working career. It was painful. It was ridiculous. It was controversial. Lies were told. We will never do it again.”
Mr Sewell went on to say …
“Moving on from there our processes are still difficult … and what I see … well what I’m clearly seeing here, is, we have had no real sit-down and discussion around where you are going … So that might give you a view of where things are going. . It is not easy from a planning perspective dealing with this city (Christchurch City Council).”
This writer, as a former commercial property development practitioner got out of Christchurch in 1993. The writing was “on the wall” then following the 1989 forced Local Government amalgamations.
Intolerable institutional failure at the local level …
The Council has done enormous damage to the political and commercial culture of Christchurch, as explained by this writer April 2014 with Christchurch Failure – The Long History.
It has sadly degenerated in to a “mongrel culture.” … a classic study of institutional failure at the local level … Suffocating Bureucracy & Failed Institutions
Remarkably … since the first earthquake events 4 September 2010 … some 4 ½ years ago now … the Christchurch City Council has still failed to wake up to the critical and urgent importance of “de-risking” Christchurch … with the essential focus on affordability and mobility.
Recovery costs twice what they should be …
The Council has failed to appreciate that the costs of the earthquake recovery are likely to be twice what they should be … because of its long history of failure since the time of forced local government amalgamation in 1989 … as explained within Christchurch: The Way Forward and Council Stall Recovery .
Christchurch is a bureaucratically buggered city.
The 1 February 2012 Peoples Protest clearly spelt out the issues …
Back in October 2013, following the 1 February 2012 4,000+ strong Peoples Protest, nine of the thirteen elected Council elected representatives were replaced October 2013 … led by Mayor Lianne Dalziel, to sort out this seriously dysfunctional Council.
Is it time for Commissioners ? …
Progress to date has been pathetic. They still don’t “get it”.
Sadly … if Mayor Lianne Dalziel with the elected representatives persist in failing to do what they were elected to do … the Government will be left with no alternative other than to replace them with Commissioners.
Christchurch simply cannot afford any more of this bureaucratic mayhem and constant failure.