Agenda of Policy Review Committee Meeting

UNCONFIRMED MINUTES

OF THE POLICY REVIEW COMMITTEE MEETING OF PENRITH CITY COUNCIL HELD IN THE PASSADENA ROOM, PENRITH

ON MONDAY 10 FEBRUARY 2020 AT 7:00PM

PRESENT

His Worship the Mayor, Councillor Ross Fowler OAM, Deputy Mayor, Councillor Karen McKeown OAM, and Councillors Jim Aitken OAM, Bernard Bratusa (arrived 7:08pm) Todd Carney, Brian Cartwright, Robin Cook, Marcus Cornish, Kevin Crameri OAM, Greg Davies, Kath Presdee and John Thain.

APOLOGIES

PRC 1 RESOLVED on the MOTION of Councillor Karen McKeown OAM seconded Councillor Kath Presdee that apologies be received for Councillors Mark Davies, Tricia Hitchen, Bernard Bratusa (arrived 7:08pm) and Aaron Duke

CONFIRMATION OF MINUTES - Policy Review Committee Meeting - 9 December 2019

PRC 2 RESOLVED on the MOTION of Councillor Brian Cartwright seconded Councillor Greg Davies that the minutes of the Policy Review Committee Meeting of 9 December 2019 be confirmed.

DECLARATIONS OF INTEREST

There were no declarations of interest.

DELIVERY PROGRAM REPORTS

Outcome 7 - We have confidence in our Council

3 Penrith Performing & Visual Arts Ltd 2018 - 2019 Annual Report

CEO of Penrith Performing & Visual Arts, Hania Radvan introduced the report and gave a presentation.

PRC 3 RESOLVED on the MOTION of Councillor Brian Cartwright seconded Councillor Greg Davies

That:

1. The information contained in the report on Penrith Performing & Visual Arts Ltd 2018 - 2019 Annual Report be received.

2. Council agree to underwrite the operations of Penrith Performing & Visual Arts Ltd until the presentation of the 2020-2021 Annual Report.

3. A further report be prepared to Council on the possibility of using the sustainability fund to replace dated lighting at the Joan.

4. Council write to the PPVA congratulating the Board, CEO and staff on a successful year.

Outcome 1 - We can work close to home

1 Mayoral Skills Summit Update

PRC 4 RESOLVED on the MOTION of Councillor Greg Davies seconded Councillor John Thain that the information contained in the report on Mayoral Skills Summit Update be received and noted.

Outcome 7 - We have confidence in our Council

2 Redundant Policies

PRC 5 RESOLVED on the MOTION of Councillor Brian Cartwright seconded Councillor Karen McKeown OAM

That:

1. The information contained in the report on Redundant Policies be received.

2. The Sustainability Policy Energy Savings Action Plan be removed from Council’s current policy register.

3. The Governance Policy Decision Making Arrangements During Council Christmas Recess be removed from Council’s current policy register.

URGENT BUSINESS

UB 1 Request for Leave of Absence - Councillor Mark Davies

His Worship the Mayor, Councillor Ross Fowler OAM requested Leave of Absence on behalf of Councillor Mark Davies from 10 February 2020 to 3 March 2020.

PRC 6 RESOLVED on the MOTION of Councillor Todd Carney seconded Councillor Karen McKeown OAM that the matter be brought forward and dealt with as a matter of urgency.

His Worship the Mayor, Councillor Ross Fowler OAM, ruled that the matter was urgent and should be dealt with at the meeting.

PRC 7 RESOLVED on the MOTION of Councillor Todd Carney seconded Councillor Karen McKeown OAM that Leave of Absence be granted to Councillor Mark Davies from 10 February 2020 to 3 March 2020.

UB 2 Request for Leave of Absence - Councillor Marcus Cornish

Councillor Marcus Cornish requested Leave of Absence for the period 25 May 2020 to 21 July 2020.

PRC 8 RESOLVED on the MOTION of Councillor Greg Davies seconded Councillor Brian Cartwright that the matter be brought forward and dealt with as a matter of urgency.

His Worship the Mayor, Councillor Ross Fowler OAM, ruled that the matter was urgent and should be dealt with at the meeting.

PRC 9 RESOLVED on the MOTION of Councillor Greg Davies seconded Councillor Brian Cartwright that Leave of Absence be granted to Councillor Marcus Cornish from 25 May 2020 to 21 July 2020.

There being no further business the Chairperson declared the meeting closed the time being 7:51pm.

Policy Review Committee Meeting 10 August 2020

Phase 1 Review of Penrith Local Environmental Plan 2010

Compiled by: Elizabeth Hanlon, Senior Planner

Authorised by: Natasha Borgia, City Planning Manager

Kylie Powell, Director - City Futures

Outcome	We plan for our future growth
Strategy	Facilitate development in the City that considers the current and future needs of our community
Service Activity	Plan for and facilitate development in the City

Procedural note: Section 375A of the Local Government Act 1993 requires that a division be called in relation to this matter.

Executive Summary

The purpose of this report is to present the results of the public exhibition and public authority consultation undertaken for a Planning Proposal to amend Penrith Local Environmental Plan (LEP) 2010 as part of Council’s LEP Review program.

The LEP amendments primarily respond to the immediate outcomes of recent planning strategies as well as to address minor housekeeping matters and form part of a phased approach to the review of the LEP.

The Planning Proposal was placed on public exhibition from 1 May to 29 May 2020. A total of 63 submissions have been received, with the majority objecting to a proposed amendment to increase the minimum lot size controls for multi dwelling housing in the R3 Medium Density Residential and R4 High Density Residential zones.

The report recommends that Council endorse the Planning Proposal, subject to a change to the proposed amendment relating to non-residential uses in the St Marys Town Centre, and submit the Planning Proposal to the Department of Planning, Industry and Environment for finalisation by 31 August 2020 in line with contractual arrangements. The submission will include a request to the Minister for Planning and Public Spaces to make the amendments to Penrith LEP 2010.

Background

Amendments to the Environmental Planning and Assessment Act 1979 (the Act), which commenced in March 2018, require councils to prepare a Local Strategic Planning Statement (LSPS) and review their Local Environmental Plans (LEPs) to give effect to the planning priorities and actions in the relevant district plan.

At its Ordinary meeting of 23 March 2020, Council adopted the Penrith LSPS, which sets out Council’s 20 year vision for land use in the local area, the special character and values that are to be preserved, and how change will be managed into the future. The LSPS gives effect to the Greater Sydney Commission’s Greater Sydney Region Plan – A Metropolis of Three Cities (GSRP) and Western City District Plan (WCDP).

A Planning Proposal has been prepared which seeks to amend Penrith LEP 2010 to align the LEP with the planning priorities set in the GSRP and WCDP, as well as those in the LSPS. The amendments form the first phase of a number of proposed staged amendments to the LEP and primarily respond to the immediate outcomes of the draft Local Housing Strategy, draft Rural Lands and Villages Strategy and draft St Marys Economic Development Strategy.

At its Ordinary meeting of 23 September 2019, Council considered a report on the Planning Proposal and resolved to forward the Planning Proposal to the Minister for Planning and Public Places with a request to issue a Gateway Determination to proceed to public exhibition. On 17 February 2020, a Gateway Determination was issued.

The Phase 1 amendments in the Planning Proposal include:

Item 1: Increasing the minimum lot size controls for multi dwelling housing in R3 Medium Density Residential and R4 High Density Residential zones from 800m² for standard lots and 900m² for battle-axe lots to 1200m² for both lot types;

Item 2: Applying a minimum lot size control for dual occupancy development in the RU5 Village zone for Londonderry and Luddenham villages; i.e. 650m² for attached dual occupancies and 750m² for detached dual occupancies;

Item 3: Permitting eco-tourist facilities, with consent, in the E4 Environmental Living zone;

Item 4: Permitting a limited number of additional land uses, with consent, on certain land within Castlereagh’s ‘centre’. These uses include centre-based child care facilities, kiosks, markets, neighbourhood shops, recreation facilities (indoor) and restaurants or cafes;

Item 5: Removing the minimum lot size requirement of 2ha for dwelling houses on 11 lots in Llandilo;

Item 6: Including a new requirement for non-residential uses in the St Marys Town Centre B4 Mixed Use zone. This requirement aims to result in the ground and first floor levels of any development in the Town Centre core being used exclusively for non-residential uses;

Item 7: Extending the provision for additional permitted uses to the whole of the site known as 164 Station Street, Penrith;

Item 8: Rezoning Triangle Park in Penrith to RE1 Public Recreation; and

Item 9: Undertaking minor housekeeping matters.

The Western Sydney City Deal has provided funding for Council to review Penrith LEP 2010 on an accelerated timeframe. This funding has been used towards the preparation of the strategies to inform the review of the LEP. The Gateway Determination required the Planning Proposal to be submitted to the Department of Planning, Industry and Environment (the Department) for finalisation prior to 1 July 2020, due to contractual arrangements as part of the accelerated LEP program. However, on 19 June 2020, the Department granted an extension until 31 August 2020.

Changes to Public Exhibition Requirements in Response to COVID-19

In March and April, the State Government introduced legislation in response to COVID-19, which made changes to the Act and Environmental Planning and Assessment Regulation 2000 temporarily removing the requirements for councils to display physical copies of documents at their offices and to notify planning processes in local newspapers.

In accordance with all legislative requirements and the conditions of the Gateway Determination, the exhibition material was made available on Council’s website, with Council officers available to answer enquiries by phone and email, and on the NSW Planning Portal. Over 5000 letters and fact sheets were sent to landowners directly affected by the proposed amendments notifying them of the exhibition. The exhibition was also advertised in the Western Weekender digital edition and on Council’s website.

Public Exhibition

The Planning Proposal was placed on public exhibition from Monday 1 May to Friday 29 May 2020. The proposed LEP amendments were placed on exhibition alongside proposed amendments to Penrith Development Control Plan 2014 and the draft Section 7.12 Citywide Development Contributions Plan for non-residential development.

A total of 63 submissions have been received on the proposed LEP amendments which are detailed below. All but two of the proposed amendments; i.e. items 2 and 8, received submissions. Submissions received in relation to items 5, 7 and 9 supported these amendments. Submissions received in relation to items 1, 3 and 6 primarily objected to these amendments, although there were a small number of submissions that supported the amendments. One submission was received in relation to item 4 and is discussed below.

Item 1: Increasing the minimum lot size controls for multi dwelling housing

The majority of submissions (41) objected to the proposed amendment to increase the minimum lot size controls for multi dwelling housing in the R3 Medium Density Residential and R4 High Density Residential zones from 800m² for standard lots and 900m² for battle-axe lots to 1200m² for both lot types.

This amendment aims to build on the initiatives Council has undertaken to date to improve the design outcomes of new multi dwelling housing developments so they are more attractive, liveable and functional. These initiatives include the Oxley Park Place Plan and amendments made in December 2018 to section 2.4 Multi Dwelling Housing of Penrith Development Control Plan (DCP) 2014 relating to lot frontages, incentives for basement car parking and the management of waste. Specifically, one of the DCP amendments was to increase the minimum lot frontage requirement for multi dwelling housing to 22m to encourage the amalgamation of lots so lots would be of an appropriate shape and size to deliver better development outcomes and help to address community concerns including the impact on residents’ amenity and the amount of on-street car parking. It was also recognised that, in assessing development applications, Council officers had been continually varying requirements because of the narrow nature of lots, usually with frontages of between 15-18m. Typical development outcomes for multi dwelling housing developments were minimal setbacks between boundaries and new dwellings; no or little landscaping along boundaries or between dwellings; awkward vehicle manoeuvring and parking arrangements; and waste collection points and onsite stormwater detention infrastructure dominating front setbacks.

The purpose of this amendment is to elevate the intention of the controls in the DCP to the LEP to encourage lot amalgamation to enable more adaptable site layouts and deliver better design outcomes. Its purpose is to ensure lots are of an appropriate size and shape to provide sufficient space for increased setbacks or separation between dwellings; more landscaping and tree planting to help green and cool our City; additional and easier parking areas with central driveways; and alternatives for waste storage and stormwater infrastructure. Its purpose is also to help improve local amenity and preserve neighbourhood character.

The main reasons for objecting to this amendment were:

· The amendment will reduce opportunities for multi dwelling housing, particularly small developments, remove a significant source of new dwellings and conflict with the State Government’s goal to increase dwellings in the City

Response:

Many of these lots are not isolated, providing opportunities for lots to be amalgamated and developed for multi dwelling housing. The draft Local Housing Strategy indicates that our City has ample supply of land for housing generally in the short, medium and long term. In terms of medium density housing, there is future capacity in Penrith’s urban investigation areas and other strategic locations, such as around new train stations.

Where lots are isolated by surrounding multi dwelling housing developments, merit based assessment can be undertaken using clause 4.6 Exceptions to development standards in the LEP. This clause requires applicants to justify a contravention of a development standard; i.e. the minimum lot size of 1200m², by demonstrating that this standard is unreasonable or unnecessary in the circumstances of the case, and there are sufficient environmental planning grounds to justify the contravention. Clause 4.6 would work together with the existing control in the DCP that allows isolated lots with a lot frontage of less than 22m to be considered on a merits basis.

· The amendment contradicts the objectives of the Low Rise Medium Density Housing Code and the R3 zone

Response:

The Code (now known as the Low Rise Housing Diversity Code) applies to one form of multi dwelling housing; i.e. terraces up to two storeys, and allows them to be built as complying development in certain zones, including the R3 zone, subject to meeting the requirements of the Code. This amendment will mean that the lot requirement under the Code will change to 1200m² for terraces, consistent with other forms of multi dwelling housing. Given the Code relates to whether development can be built as complying development rather than as local development, the amendment is not considered to contradict the Code’s objectives.

The amendment will support the objectives of the R3 zone as it will continue to provide for housing within a medium density residential environment, contribute to a variety of housing types, and result in better design and amenity outcomes that will help to enhance and protect local character.

· The amendment is unlikely to result in better design outcomes or contribute positively to local character; a merit-based assessment should be adopted

Response:

There is no evidence provided in the submissions to support this comment. There are examples of multi dwelling housing development on larger lots delivering better design and amenity outcomes, including those illustrated in the Department’s Low Rise Housing Diversity Design Guides for Complying Development and Development Applications. Positive outcomes include:

· Increased separation between dwellings and adjoining development;

· Further off-street parking and easier manoeuvring areas, resulting in less vehicles parking on the street;

· More landscaping and tree planting to help green and cool our City; and

· Improved stormwater and waste management on the site.

There is allowance for isolated lots with a minimum lot size of less than 1200m² to be considered on a merits basis using clause 4.6 of the LEP.

· The amendment is unfair to those with lots between 800m²-1200m² and will have significant financial impacts, particularly decreasing property values

Response:

The amendment does not remove opportunities for lots to be amalgamated and developed for multi dwelling housing. A report by SGS Economics and Planning on the financial viability of the DCP amendments prepared in 2018, included a test on the financial impacts of lot amalgamation. The report concluded that the amalgamation of properties will be financially feasible for developers.

There is also allowance for isolated lots with a minimum lot size of less than 1200m² to be considered on a merits basis using clause 4.6 of the LEP.

There are many factors that influence property values and people’s decision to buy and sell property. While zoning and planning controls are one factor, there are other considerations such as the area’s demographics, its proximity to services and amenities (e.g. parks, public transport and schools), other sales in the local area, current and predicted investment in the area, and whether property is affected by factors such as traffic noise. The assessment of property values is the responsibility of the NSW Government’s Valuer General.

Council has a responsibility to plan for multi dwelling housing that is of high-quality design, functions effectively and delivers better environmental outcomes.

· The amendment will encourage developers to purchase adjoining lots and build larger developments, causing negative impacts on traffic, infrastructure and amenities

Response:

The intention of this amendment and the amendments to the DCP is to encourage lot amalgamation to create lots of an appropriate size and shape to enable more adaptable site layouts and deliver better amenity and design outcomes. The amalgamation of lots is expected to deliver comparable dwelling yields and allow potential impacts to be better managed over larger development sites.

Item 3: Permitting eco-tourist facilities in the E4 Environmental Living zone

Two submissions objected to the proposed amendment to permit eco-tourist facilities in the E4 Environmental Living zone suggesting that this will increase property values and hence rates.

The purpose of this amendment is to provide another form of accommodation for tourists and visitors to the City in rural areas to support tourism opportunities that promote our natural areas, rural heritage and rural events; thereby, growing rural tourism to support a diverse rural economy.

Response:

As previously outlined, there are many factors that influence property values and permitting this additional use in the E4 zone is unlikely to influence property values.

Item 4: Permitting a limited number of additional land uses on certain land within Castlereagh’s ‘centre’

One submission requested that the proposed amendment to permit a limited number of additional community and commercial land uses on certain land within Castlereagh’s ‘centre’ be expanded to also permit a dwelling house and secondary dwelling on two lots (Lots 45 and 46 DP 3784) which are subject to a minimum 2ha requirement for a dwelling house. The submission argues that the 2ha requirement is onerous and unreasonable.

The purpose of this amendment is to strengthen the role of Castlereagh’s ‘centre’ by enabling some incremental growth and a focus for commercial and social activities for the surrounding community. This location already includes several community uses such as a public school, community hall, local park and rural fire station, as well as a service centre providing day-to-day goods.

Response:

The construction of a dwelling house on each of these lots was a matter considered by Council during the preparation of Stage 2 of Penrith LEP 2010. At that time, Council did not support a change to the LEP to allow a dwelling house on the lots for reasons relating to the rural character of the area, on-site sewage management and precedent. The two lots each have an area of about 4,450m² and are part of an early 1900 paper subdivision. The surrounding area is zoned E4 Environmental Living and RU4 Primary Production Small Lots, with a 2ha minimum lot size requirement for subdivision. Lots in the area are generally 2ha or larger to accommodate rural residential development and some small scale agricultural uses.

The planning control requiring a 2ha minimum lot size for a dwelling house for these and some adjoining lots to the west fronting Post Office Road in the same paper subdivision date back to 1977. The planning control also applies to a number of properties in Londonderry and Llandilo. It is considered that relaxing the control in this location would set a precedent for these other locations.

The planning control aims to maintain the existing rural character of the area, control the demand for the provision of public amenities, services and infrastructure, and support the effective functioning of on-site sewage management systems. In this regard, Council’s On-site Sewage Management Policy encourages 10,000m² (1ha) lots where there is no reticulated sewerage system.

Since Council’s earlier decision, the draft Rural Lands and Villages Strategy has been prepared. It recommends that the Castlereagh ‘centre’ be strengthened as a focus for commercial and social activities for the surrounding community, subject to future sewer management capabilities, and not for additional housing. Therefore, it is recommended that this proposed amendment not be expanded to permit a dwelling house and secondary dwelling on Lots 45 and 46.

Item 6: Including a new requirement for non-residential uses in the St Marys Town Centre

Five submissions objected to the proposed amendment to apply a new requirement in the St Marys Town Centre B4 Mixed Use zone which results in the ground and first floor levels of any development in the Town Centre core being used exclusively for non-residential uses.

The purpose of this amendment is to protect the retail and commercial core of the St Marys Town Centre for future non-residential uses and ensure retail and commercial floorspace demand can be met into the future as St Marys transitions to a Strategic Centre as identified in the WCDP and LSPS. It is also intended to apply this provision alongside a suite of other DCP controls for the St Marys Town Centre that seek to protect the character and commercial potential of Queen Street.

Currently, the DCP requires mixed use developments to provide commercial uses (i.e. retail/business/office premises) at the ground floor level and in part of the first floor level for most properties zoned B4 in the Town Centre. These commercial uses are required to front certain streets, including Queen Street and the Great Western Highway, to help create an attractive and vibrant town centre with safe public spaces and a diverse range of activities for workers, residents and visitors. While the DCP provides some scope to vary these requirements, a key objective is to protect the commercial potential of the Town Centre. These DCP controls also work together with clause 7.8 Active street frontages of the LEP where it applies to the St Marys Town Centre.

The submissions objecting to the proposed amendment argued that businesses in St Marys are struggling so residential development should be encouraged in the Town Centre, and that current planning controls are not viable for developers and owners; for example, building heights should be increased from 24m to 30m. Two submissions requested that Nos. 18, 20, 22 and 24 Princess Mary Street be exempted from the amendment as they are heritage items.

Response:

Given the need to protect the retail and commercial core of the St Marys Town Centre for future non-residential uses, it is recommended that the Planning Proposal be amended to indicate that the new provision will only apply to land affected by clause 7.8 Active street frontages and not to all land zoned B4 in St Marys. The purpose of the new provision will be to elevate the controls in the DCP to the LEP by requiring:

a) the ground floor level of any development to be used exclusively for non-residential uses; and

b) the first floor level of any development to also be used exclusively for non-residential uses; however, an exception may be considered at the first floor level where the property has dual road frontages and the non-residential uses face the street with the active street frontage and residential uses face the other street.

For example, if a property has dual road frontages to Queen Street and East Lane, then the ground floor level must be used for non-residential uses. While non-residential uses would also be strongly encouraged on the first floor level; consideration could be given to part of the first floor level being used for residential uses provided the non-residential uses face Queen Street and the residential uses face East Lane.

This provides some flexibility to accommodate residential uses.

With further strategic work being undertaken in relation to the St Marys Town Centre as part of the Places for Penrith Strategy, it is intended that this new provision will operate in the interim until this strategic work is completed. The strategic work will also inform any review of other planning controls for the St Marys Town Centre.

The heritage items at Nos. 18, 20, 22 and 24 Princess Mary Street, St Marys will not be affected by the new provision as it will only apply to land in St Marys affected by clause 7.8 Active street frontages of the LEP.

Public exhibition and notification processes

Three submissions raised concerns about the lack of communication and consultation on the Planning Proposal expressing disappointment with the notification process (no letters were received by this landowner) and indicating that it was unfair to exhibit during the COVID-19 lockdown. In accordance with the legislation, including changes in response to COVID-19, and the conditions of the Gateway Determination, the exhibition material was made available on Council’s website with Council officers available to answer enquiries by phone and email, and on the NSW Planning Portal. Over 5000 letters and fact sheets were sent to landowners directly affected by the proposed amendments notifying them of the exhibition. The exhibition was also advertised in the Western Weekender digital edition and on Council’s website. An extension of time was not able to be granted for submissions due to the contractual time frame set by the Department, which at the time was 1 July 2020.

Public Authority Consultation

Public authorities, including NSW Rural Fire Service (RFS), Greater Sydney Commission (GSC) and Sydney Water, were consulted in accordance with the Gateway Determination. NSW RFS has advised that a strategic bush fire risk assessment is required to support the proposed amendments to LEP 2010. This assessment is currently being undertaken and will be submitted to the Department with the Planning Proposal. Should the assessment identify any significant issues with the proposed amendments, these will be reported to Council. The GSC has advised that it has no comments on the Planning Proposal. Sydney Water supports the housekeeping amendment to rezone 16 of its properties to SP2 Infrastructure, as requested. Sydney Water also notes the proposed amendments in Castlereagh’s ‘centre’ and Llandilo and advised that there are no plans to provide wastewater services in these areas.

Council also received four submissions from public authorities not required to be consulted under the Gateway Determination conditions. These submissions from Water NSW, the Department’s Environment, Energy and Science Group, Transport for NSW and Schools Infrastructure NSW (part of the Department of Education), raised no objections to the Planning Proposal.

Next Steps

Should Council resolve to endorse the recommendations of this report the updated Planning Proposal will be submitted to the Department for finalisation by 31 August 2020 in line with contractual arrangements. The submission will include a request to the Minister for Planning and Public Spaces to make the amendments to Penrith LEP 2010.

Conclusion

Council officers have prepared a Planning Proposal which seeks to amend Penrith LEP 2010 to align the LEP with the planning priorities set in the GSRP and WCDP, as well as those in the LSPS. The amendments form the first phase of a number of proposed staged amendments to the LEP and primarily respond to the immediate outcomes of the draft Local Housing Strategy, draft Rural Lands and Villages Strategy and draft St Marys Economic Development Strategy. The amendments also address minor housekeeping matters.

The Planning Proposal has been placed on public exhibition and a total of 63 submissions have been received. Following consideration of these submissions, it is recommended that a change be made to the proposed amendment relating to non-residential uses in the St Marys Town Centre.

It is recommended that the Planning Proposal be updated and submitted to the Department for finalisation by 31 August 2020 in line with contractual arrangements. The submission will include a request to the Minister for Planning and Public Spaces and Parliamentary Counsel to make the amendments to Penrith LEP 2010. The submission will also be supported by the strategic bush fire risk assessment, once finalised.

RECOMMENDATION

That:

1. The information contained in the report on Phase 1 Review of Penrith Local Environmental Plan 2010 be received.

2. Council endorse the Planning Proposal presented in this report (including the change to the proposed amendment relating to non-residential uses in the St Marys Town Centre), which has been provided to Councillors as a separate enclosure and is publicly-available on Council’s website.

3. The General Manager be granted delegation to update and finalise the Planning Proposal referred to in resolution 2 prior to Council's submission of the Planning Proposal to the Department for finalisation, with the strategic bush fire risk assessment.

4. Council officers forward the Planning Proposal to the Minister for Planning and Public Spaces with a request to make the local environmental plan amendments.

ATTACHMENTS/APPENDICES

There are no attachments for this report.

Policy Review Committee Meeting 10 August 2020

Penrith Development Control Plan 2014 Housekeeping Amendment

Compiled by: Breannan Dent, Planner

Natalie Stanowski, Principal Planner

Authorised by: Natasha Borgia, City Planning Manager

Kylie Powell, Director - City Futures

Outcome	We plan for our future growth
Strategy	Ensure services, facilities and infrastructure meet the changing needs of our City
Service Activity	Ensure our policies, strategies and plans provide for the services and infrastructure our City needs

Previous Items: 3- Penrith Development Control Plan 2014 Housekeeping Amendments for Public Exhibition- Ordinary Meeting- 23 Mar 2020 7:00PM

Procedural note: Section 375A of the Local Government Act 1993 requires that a division be called in relation to this matter.

Executive Summary

The purpose of this report is to present the results of the public exhibition of housekeeping amendments to Penrith Development Control Plan (DCP) 2014.

The exhibited amendments to DCP 2014 include the introduction of controls for adult change facilities, updating vegetation management controls, updating outdoor dining and trading controls, updating boarding house controls and removing notification and advertising from the DCP as these are now found in Council’s adopted Community Participation Plan. These housekeeping amendments have been progressed ahead of a comprehensive review of DCP 2014 as they support and compliment Council’s established position or state policies that are currently in force.

Nine submissions were received during the public exhibition. Key issues raised in the submissions include:

· Support for the draft Adult Change Facility amendments.

· Recommended changes to the draft Adult Change Facility and accessibility controls.

· Concerns regarding Boarding House developments in Kingswood.

· Concerns regarding the draft boarding house amendments.

· Concerns regarding Vegetation Management controls, fees and assessment processes.

Minor changes to the draft controls are proposed in response to submissions and feedback received during the public exhibition. It is recommended that Council adopt the amendments to DCP 2014, with minor amendments.

Background

At the Ordinary Meeting of 23 March 2020, Council endorsed the public exhibition of draft housekeeping amendments to DCP 2014. These amendments have been progressed ahead of a comprehensive review of DCP 2014. The amendments are considered minor in nature or provide further clarification to development controls which are consistent with existing and endorsed Council position and State policies.

The draft DCP amendments include the following:

· Incorporating controls for Adult Change Facilities to ensure the DCP addresses the need for accessible public spaces.

· Updating Vegetation Management controls in response to recent State Environmental Planning Policy (SEPP) changes.

· Updating Outdoor Dining and Trading controls to reflect and support Council’s recently adopted Outdoor Dining Policy and Guidelines.

· Updating Boarding House controls to provide greater support and clarification on Council’s position on this type of development.

· Removing Notification and Advertising, as this has now been superseded by Council’s recently adopted Community Participation Plan (CPP).

Public Exhibition and Submissions

The amendments were publicly exhibited from 1 May 2020 to 29 May 2020. The public exhibition was undertaken in accordance with the Environmental Planning & Assessment Act, 1979 (‘The Act’) requirements at the time of exhibition and Council’s Community Participation Plan. The exhibition occurred during the time Councils Civic Centre and libraries were closed due to Covid19. Advertising requirements under The Act and its Regulations were amended by the Department of Planning, Industry & Environment (DPIE) to enable Councils to advertise new plans & amendments on Councils website and via DPIE’s planning portal, instead of having physical copies available or a notice published in the local newspaper, as normally required.

Consistent with these changes, the draft amendments were made available for the public to view on Council’s Your Say page, accessed via Council’s website. The exhibition was advertised on Council’s social media pages and on Council web pages. The amendments were also available on the Planning Portal. In addition to the new requirements, the amendments were also advertised in the Western Weekender newspaper (digital edition).

A total of nine submissions were received during the exhibition period in response to the draft DCP 2014 amendments. Five of the submissions were made in respect to the controls for Boarding Houses, three submissions on Adult Change Facility controls and one submission on Vegetation Management. No submissions were received on the removal of the Notification and Advertising controls or amendments to Outdoor Dining and Trading controls.

Of particular note, Council received a letter of commendation from the Disability Council of New South Wales for Councils leadership regarding accessibility for people with a disability, specifically for adult change facilities. The letter acknowledged that Council may be the first in NSW to exceed the National Standards for the provision of such facilities.

A summary of the issues raised in the submissions received during the public exhibition period relating to the draft control amendments and a response to those issues, are provided in Attachment 1. It is noted that there were several submissions raising matters not directly related, or subject to, the draft controls. These have been addressed in Attachment 2 and will be considered further during the comprehensive review of DCP 2014, which is currently underway.

Proposed Amendments to the Draft DCP in response to the exhibition

As a result of the review of submissions and advice received from internal Council stakeholders, minor amendments to the draft DCP are recommended. The proposed changes are detailed in the table below.

Matters Raised	DCP Change Proposed	Reason for Change
Outdoor Dining and Trading
The DCP is inconsistent with Council’s Outdoor Dining Policy in relation to the Outdoor Trading public liability insurance requirements.	The required public liability insurance amount for approved Outdoor Trading is to be increased from 10 million to 20 million.	Ensure consistency with Councils adopted Outdoor Dining Policy and Guidelines.
Adult Change Facilities
The Residential Development chapter of the DCP references outdated Australian Standards in relation to accessibility.	Update references to Australian Standard 1428.1-1998 within the in the Residential Development chapter of DCP 2014 to Australian Standard 1428.1.	The Australian Standard referenced in the Residential Development chapter of DCP 2014 is no longer applicable and should be updated to match the current Standard. This chapter is now proposed to be amended to update these references, although no other changes to these controls are proposed by the amendments.
Recommend a minimum area requirement for the provision of an adult change facility in multi tenanted bulky goods developments, to ensure this is not subject to interpretation.	Additional information will be provided to indicate how Multi-tenanted specialised retail premises (bulky goods developments) will be assessed to determine if they are considered a retail destination.	Multi-tenanted specialised retail premises (bulky goods developments) vary in scale and retail pull. A numerical standard, whilst ideal, would not suitably address these matters. However, it is proposed to provide clarification on how the control will be assessed.
Boarding Houses
The publicly exhibited building envelope controls for boarding houses in the R3 zones impact the delivery of a 2nd storey	Apply the existing building envelope control for multi dwelling housing to boarding houses in the R3 zone.	The draft amendments proposed a building envelope from Multi Dwelling Housing apply to boarding houses in R3 zones. Taking into consideration the amended side setback controls, it is proposed to continue to implement the existing building envelope controls until further review will be undertaken in stage 2 of DCP 2014 Review.
There is a need to rephrase and clarify proposed amendments for certain controls in the R2 and R3 zones.	Clarify the application of certain controls for boarding houses in R2 and R3 zones by amending the wording.	There appears to be confusion on how the controls are applied for development in each zone. Clarification of these is needed to reduce confusion.
Requests for minor phrasing or wording alterations to increase clarity.	Minor phrasing and wording changes.	Clarify the interpretation of existing controls for Solar Access and application of Landscape controls.
Vegetation Management
Requests for minor wording alterations to increase clarity.	Minor wording changes.	Reduce confusion in the interpretation of existing controls by making minor grammatical amendments.

Changes in the above table have been incorporated into the draft amendment to DCP 2014. A complete copy of DCP 2014, with these amendments, is provided as an Enclosure to this report. A track changes copy of amendments made to the DCP after the public exhibition is provided as Attachment 3.

Next Steps

Should Council resolve to adopt the draft DCP 2014, including amendments recommended in this report, a notice of this decision will be published within 28 days after the decision is made, as per the requirements of the Environmental Planning and Assessment Regulation 2000. This notice must include the reasons for this decision.

The amendments to DCP 2014 will come into effect immediately on the date that notice of Council’s decision to approve the plan is published on its website.

Conclusion

The draft housekeeping amendments to Penrith DCP 2014 are an interim measure to update the DCP in relation to adult change facilities, tree and vegetation management, outdoor dining and trading, boarding houses, and community engagement. Further amendments to DCP 2014 will be undertaken through the course of the broader DCP Review.

The proposed amendments will achieve better outcomes for future development for both Council and the community, by providing clearer and more consistent planning controls.

During the public exhibition, nine submissions were received in relation to the draft plan. These submissions have been reviewed and as a result, minor changes to the draft controls are proposed.

This report recommends that Council approve the draft Housekeeping Amendments to Penrith Development Control Plan 2014, as provided in the Enclosure to this report.

RECOMMENDATION

That:

1. The information contained in the report on Penrith Development Control Plan 2014 Housekeeping Amendment be received

2. Council adopt the amendments to Penrith Development Control Plan 2014, as exhibited, with minor amendments as detailed in this report and provided as an enclosure.

3. The General Manager be delegated authority to make any necessary minor changes required to the Development Control Plan 2014, consistent with Council’s adopted policy position and before notification.

4. In accordance with the Environmental Planning and Assessment Regulation 2000, Council give public notice of its decision on Council’s website within 28 days, with the Development Control Plan coming into effect immediately upon notification.

ATTACHMENTS/APPENDICES

1. ⇩	Summary of matters raised in submissions in relation to the Draft DCP 2014 Amendment	10 Pages	Attachments Included
2. ⇩	Matters Raised in Submissions Unrelated to the Proposed Amendments	4 Pages	Attachments Included
3. ⇩	DCP 2014 Tracked Changes Post Exhibition	35 Pages	Attachments Included

Policy Review Committee Meeting 10 August 2020

Penrith CBD Corporation Annual Report and Audited Financial Statement

Compiled by: Rebekah Elliott, City Engagement Coordinator

Authorised by: Jeni Pollard, City Activation, Community and Place Manager

Outcome	We have safe, vibrant places
Strategy	Help make our major centres and important community places safe and attractive
Service Activity	Support the revitalisation of Penrith City Centre and St Marys Town Centre

Presenters: Gai Hawthorn, Manager, Penrith CBD Corporation – Penrith CBD Corporation 2019-2020 Performance; and

Darren Latty, President, Penrith CBD Corporation – Penrith CBD 2020-2021 Planned Activities

Executive Summary

The Penrith CBD Corporation has submitted their Annual Report and Audited Financial Statements for 2019-2020. This report provides an overview and commentary on the documentation submitted.

Attached to this report is the Annual Report and Audited Financial Statement for 2019-2020 and the agreed Key Performance Indicators (KPIs) for 2020-2023.

This report recommends that Council receive the information on the Annual Report and Audited Financial Statement for 2019-2020 and endorse the proposed Key Performance Indicators for 2020-2023.

Background

Penrith City Council works with the St Marys Town Centre Corporation and the Penrith CBD Corporation to jointly manage the centres to support their ongoing vitality and viability. Council collects rates from non-residential properties in the city centre and returns these to the Corporations. In 2020-2021, $454,376 (exc GST) will be paid to the Penrith CBD Corporation to undertake the proposed activities as outlined in their KPIs 2020-2021.

Council and the Corporations have a Service Level Agreement that requires the Corporations to provide an annual report to Council.

On the 22 June 2020 at the Ordinary Council Meeting, through the Triennial Impact Review of the City Centre Corporations, Council endorsed a Key Performance Indicator Framework. The KPIs were developed in consultation with the Corporations and are consistent with the needs of the Penrith CBD Corporation to continue to build their profile with the local businesses and explore opportunities to promote the Penrith City Centre to local residents, visitors and potential new business operators and property investors.

The KPIs involve four objectives to support their management and improve reportable outcomes. The Corporation’s four objectives are:

1. Governance

2. Marketing

3. Strategy

4. Facilitation

Over the past three years, the Corporation has been gearing its activity towards the growth of residential development in the city centre with the expected increase in population, and the opportunities that arise for local businesses as a result of this growth. The Corporation has been working with businesses coming into the city centre and supporting existing businesses to leverage off the new growth and change. The Corporation is also flagging their role in working with property owners to increase their knowledge about infrastructure improvements and to encourage them to look at their own property portfolios to ensure that they are keeping pace.

Annual Report and Audited Financial Statement 2019-2020

The Corporation has prepared an annual report on their activities during the 2019-2020 financial year. In 2019-2020, $442,862.00 was paid to the Corporation.

The report provides an overview of the initiatives and events held during the year such as the Tree Lighting Event, bi-monthly newsletters through to more day to day activities supporting businesses with marketing and building networks.

Notable, through additional funding received from Council, the Corporation has continued to work with property owners to upgrade under awning lighting to compliment the streetscape upgrade works on High Street and enhance the pedestrian experience in the city centre at night.

The Annual Report and Audited Financial Statement 2019-2020 is attached to this report for Council’s consideration (Attachment 1 and 2).

Key Performance Indicators 2020-2023

As part of the Triennial Impact Review of the City Centre Corporations undertaken in 2019-2020, a series of KPIs were developed in consultation with the Corporations. The KPIs were developed to help quantify the outputs and outcomes of the Corporations activities and sought stronger alignment to Council’s strategic vision for the Penrith City Centre.

The KPIs provide an opportunity for the Board to identify priority and ongoing projects for the year ahead. The Penrith CBD Corporation have committed to a COVID-19 recovery program during the next 12 months that focuses on positive opportunities for businesses and the community in the Penrith City Centre. The Chairperson of the Board, Darren Latty also sits on Council’s COVID Economic Recovery Taskforce.

The Corporation want to continue actively working with businesses that may be considering Penrith City Centre as a desirable location, whilst still supporting those that have already chosen to invest in property or businesses in the centre through an active workshop and training program.

The presentation from the CBD Corporation that accompanies this report will go into further detail on proposed activity for 2020-2021. The overview of the KPIs is attached to this report for Council’s consideration (Attachment 3).

Financial Services Manager’s Comment

The Penrith CBD Corporation appears to be trading in a sound financial manner. In 2019-20 the Corporation received $442,862 (exc GST) from Council.

The Corporation recorded a revenue decrease of $134,626 (-18%) to a total revenue of $606,648 in 2019-20 ($741,274 in 2018-19). Total expenditure decreased by $159,108 (22%) in 2019-20 to a total expenditure of $560,810 compared to $719,918 in 2018-19. There were several contributing factors to the revenue and expenditure decrease which included a reduction in grant funding from sources other than Council, the cancellation of the Penrith Festival and less uptake in the city flags program.

In 2019-20 the net profit was $45,838 ($21,356 in 2018-19). The Corporation has a positive level of cash and cash equivalent reserves of $129,545 in 2019-20 ($78,678 in 2018-19) and increased its Equity position to $94,223 in 2019-20 from $48,385 in 2018-19.

Conclusion

The Penrith CBD Corporation has submitted its Annual Report and Audited Financial Statements with highlights from 2019-2020 and the KPIs for the remainder of 2020-2021 for Council’s consideration.

This report provides and overview and commentary on the documents as presented from the Penrith CBD Corporation. The Key Performance Indicators are considered to support the interests of all stakeholders, businesses, property owners and residents in the Penrith City Centre.

RECOMMENDATION

That:

1. The information contained in the report on Penrith CBD Corporation Annual Report and Audited Financial Statement 2019-2020 be received

2. Council receive information on the Annual Report and Audited Financial Statement for 2018-2019 of the Penrith CBD Corporation.

3. Council endorse the Penrith CBD Corporation’s Key Performance Indicators for 2020-2021.

ATTACHMENTS/APPENDICES

1. ⇩	Penrith CBD Corporation Annual Report	37 Pages	Attachments Included
2. ⇩	Penrith CBD Corporation Audited Financial Statement 2019-2020	21 Pages	Attachments Included
3. ⇩	Penrith CBD Corporation KPI	3 Pages	Attachments Included

Policy Review Committee Meeting 10 August 2020

Investment Policy 2020/21

Compiled by: James Legarse, Operational Project Accountant

Authorised by: Neil Farquharson, Financial Services Manager

Andrew Moore, Director - Corporate Services

Outcome	We have confidence in our Council
Strategy	Manage our money and our assets to be sustainable now and into the future
Service Activity	Provide accurate information to Council and the community on council’s financial activities

Executive Summary

The Council’s Investment Policy 2020/21 (the Policy) is reviewed on an annual basis and Council officers have completed the review over recent months. It is a prudent and appropriate financial management practice that the Policy be reviewed to take into account the latest economic environment and investment strategies.

The current Ministerial Investment Order was issued in 2011 and was incorporated in the Council’s Policy revisions since 2013. The proposed Policy was reported to Council’s Audit Risk and Improvement Committee (ARIC) on the 10^th of June 2020, and there were no further recommendations provided.

The proposed draft Policy incorporates a:

· Review of Strategy Documents;

· Move to Moody’s financial rating (which uses a different rating scale); and

· Further link to Council’s risk appetite.

Background

In May 2010 the Department of Premier and Cabinet, Division of Local Government released their Investment Policy Guidelines to assist councils in their preparation of an Investment Policy for the prudent and appropriate management of councils’ surplus funds. This was in response to concerns some funds were not invested in councils’ names, and the loss of capital from some councils investing in structured products like Collaterised Debt Obligations (CDOs). The Ministerial Investment Order dated 11 February 2011 removed the ability for councils to invest in mortgages of land, deposits with Local Government Financial Services and added key considerations.

On 10 October 2017 the OLG released Circular Number 17-29 - Interim TCorp Waiver which allows councils to seek investment advice from TCorp as part of their financial and strategic planning processes. Section 5 of the Guidelines requires councils to seek advice from advisors licenced by the Australian Securities and Investments Commission, to receive written confirmation that no actual or potential conflicts of interest exist, and to undertake separate reference checks of advisors.

The Council’s Investment Policy was last amended and reported to Council on the 22 July 2019. In this Policy review, some of the amendments are cosmetic in nature and does not constitute to a change in Policy.

The proposed changes to the 2020/21 Investment Policy and Strategy continues to support and endorse the Council’s risk profile of ‘conservative’ approach in investment decision making. The predominant enhancement in the Investment Policy occurred in Section 6, being ‘Risk Management’, which details the credit and maturity guideline. Therein lies, the management of three major risks components commonly associated with treasury (cash and investment) functions, being credit, market and liquidity risks.

Variations to existing Investment Policy

1. Change in the preferred Credit Rating Agencies.

From ARIC’s Action Items report in June 2019, it was mandated for Council to use Moody’s as the official credit rating when assessing the Investment Portfolio. Formerly, the Council used Standards and Poors (S&P) as the preferred credit rating agency.

To serve as a point of reference in the conversion of the preferred credit rating agencies, Image 1 shows the grading matrix from the ‘Big3’ assessors; and how each grade is translated across the board.

Image 1

Table 1 illustrates the impact of the change in the Council’s Investment Portfolio (as at 30 April 2020). The variation between the two agencies would implicate the upgrade of the BBB+ investments under S&P (in blue) to A3 as categorised by Moody’s (in orange).

Table 1

S&P	Short Term ($)	Percentage (%)	Moody's	Short Term ($)	Percentage (%)
A1+	53,618,265.32	34%	Prime1	93,118,265.32	59%
A1	39,500,000.00	25%
A2	10,000,000.00	6%	Prime2	10,000,000.00	6%
Subtotal	103,118,265.32	65%	Subtotal	103,118,265.32	65%

	Long Term ($)	Percentage (%)		Long Term ($)	Percentage (%)
AA-	39,500,000.00	25%	Aa2	29,500,000.00	19%
			Aa3	10,000,000.00	6%
A+	6,000,000.00	4%	A1	2,000,000.00	1%
			A2	4,000,000.00	3%
			A3	7,250,000.00	5%
BBB+	7,250,000.00	5%
BBB*	2,108,813.20	1%	Baa2*	2,108,813.20	1%
Subtotal	54,858,813.20	35%	Subtotal	54,858,813.20	35%

Total	157,977,078.52	100%	Total	157,977,078.52	100%

*These investment products relate to the Mortgage Backed Securities (MBS) that were acquired by the Council in 2006 and 2007 – with maturity years of 2051 and 2057, respectively. The Council has since stopped further investments in this product due to its volatility and low returns.

The recommendations from ARIC would also change the way the Council would present the following frameworks, as detailed in section 6.1 of the Investment Policy – under ‘Credit and Maturity Guidelines’.

Tables 2 and 3 are the results of the change in the preferred credit rating agencies for the relevant frameworks.

Table 2 Overall Portfolio Credit Framework

Portfolio Credit Limits
Long Term Credit Ratings Categories	Short Term Credit Ratings	Maximum
Aaa	Prime 1 (P1)	100%
Aa1, Aa2, Aa3		100%
A1		60%
A2	Prime 2 (P2)	40%
A3		20%
Specific Ministerial Approved Forms of Investment
NSW Treasury Corp Deposits and TCorp IM Cash Funds		40%

Table 3 Institutional Credit Framework

Individual Counterparty Limits
Long Term Credit Ratings Categories	Short Term Credit Ratings	Maximum
Aaa	Prime 1 (P1)	40%
Aa1, Aa2, Aa3		40%
A1		25%
A2	Prime 2 (P2)	20%
A3		10%
NSW Treasury Corp Deposits and TCorp IM Funds
Cash Fund/Short Term Income Fund		30%
Medium Term/Long Term Growth Funds		10%

2. Term to Maturity framework

Three changes are made in this section of the Policy, being section 6.1 item 3 of the Investment Policy.

Firstly, Term to Maturity Framework will now be called ‘Liquidity Framework’. This is consistent with the treasury terminology used in the industry and provides a more encapsulating approach to how the Council manages its Cash and Investments. Wherein, some ‘Cash’ does not have a maturity date – i.e. General Fund Account and Call Account.

Secondly, expanding on the segregation of ‘Short-term’ to ‘1month’ and ‘2 to 12 months’. Currently, the Investment Policy’s minimum framework, for ‘Short-term (0-1year)’, indicates 20% of the portfolio. Applying this addition would strengthen the Council’s ability and confidence to ensure funds are available when they fall due. It safeguards the funding of the weekly expenditures as the revised Investment Policy would now require in the ‘1month’ term, a 10% of total portfolio or $20M, whichever comes first. The $20M is the Council’s average outgoings on a monthly basis. Furthermore, applying a 40% framework for ‘2 to 12 months’ term places a strong buffer in the Council’s expenditures, and support the business activities in between rates income.

Thirdly, provide a more directive approach and information to the ‘Minimum’ and ‘Maximum’ Liquidity Frameworks. The proposed inclusion of threshold seeks to position the Council’s Investment Portfolio to a more sustainable approach. In doing so, the revised Investment Policy places a minimum percentage of 15%, of the total portfolio, for the ‘1 to 5 years’ term. The current Investment Policy does not have a minimum threshold for the ‘Medium Term (Over 1-5 years)’.

Table 4 illustrates the abovementioned changes to the Liquidity Framework of the Council. Also, to further demonstrate the impact of the changes in the Council’s investment portfolio, the table presents a dollar figure for each percentage used – using the average portfolio amount of $160M.

Table 4

	Minimum Framework		Maximum Framework
	Minimum % of the total portfolio	Minimum ($)	Maximum % of the total portfolio	Maximum ($)
· 1 month (incl. Call Account & General Fund)	10% or $20M (whichever comes first)	16,000,000.00	100%	160,000,000.00
· 2 to 12 months	40%	64,000,000.00	70%	112,000,000.00
· 1 to 5 years	15%	24,000,000.00	40%	64,000,000.00
· Over 5 years	0%	0.00	5%	8,000,000.00

3. Breaches of frameworks

The current Investment Policy, under ‘Additional Guidelines’, provide instructions for investments that become ‘non-compliant’ due to changes in the circumstance of portfolio makeup and downgrade of investment products. The relevant information is as below:

· Investments that fall outside of the above parameters post initial investment shall be divested as soon as practicable whilst being cognisant of prevailing market conditions.

· In the event that the credit rating of a security falls below the credit rating limits as set within this Investment Policy, Council will divest of the investment as soon as practicable whilst being cognisant of any extenuating circumstances.

It is recommended to remove the above guidelines and create a more precise and clearer directives, in the event of unavoidable breach of the Council’s framework. Before an acquired investment becomes ‘non-compliant’ under the adherence to the Policy, it would have been first deemed ‘compliant’. A change in external factors, unless would result in severe loss of asset, should only serve as a ‘warning’ and not a decision to divest the investment product(s). Breaking term deposits before the contracted period of investment causes significant penalty cost. This alone, breaches the first objective of the Policy, being ‘Preservation of capital’. Trading Floating Rate Notes before its maturity date, should they fall outside the parameters of the current investment Policy, is subject to the buyers/investors’ appetite.

A new section in the Policy is introduce under ‘Breaches of framework’, in lieu of the removed two points under the ‘Additional Guidelines’. A clause in ‘Grandfathering of Investments’ is now included. This entails that, any unavoidable breaches to the framework due to the two circumstances below, would result to a ‘freeze’ or ‘hold’ on the investment and/or its respective financial institution:

· amendments to regulatory directives or legislation

· changes in the total value or amount of the Council’s investment portfolio which consequently changes any of the framework limits, so that they no longer meet the portfolio liquidity framework.

The principle of the ‘grandfathering’ system is already being applied in the retention of the Mortgage Backed Securities (MBS), as acquired by the Council since 2006 and 2007 – with maturity years of 2051 and 2057, respectively.

4. Review of Investment Strategy – placing an enhanced benchmark

The finance team performed an analysis on the current investment portfolio, to determine the current average spread of the investment deals that the Council invest with. The analysis shows the current portfolio produced an average credit spread of 43 basis points (bps) over the official RBA cash rate.

With exception to General Fund account and Call Account, both are subject to market rates, it is presented that the Council would apply an enhanced benchmark of 45 bps over the 90 day Bank Bill Swap Rate (BBSW), on all investment products that it would acquire. This would ensure a continued outperformance of the Council’s Investment Portfolio, against the benchmark wherein we compare the monthly results, as detailed in section 5.5 of the Investment Policy.

RECOMMENDATION

That:

1. The information contained in the report on Investment Policy 2020/21 be received.

2. Council adopt the proposed changes to the Investment Policy tabled in this report.

ATTACHMENTS/APPENDICES

1. ⇩	2020-21 Investment Policy	8 Pages	Appendix
2. ⇩	2020-21 Investment Policy Attachments	12 Pages	Appendix
3. ⇩	2020-21 Investment Strategy	4 Pages	Appendix

v	Meeting at which the draft corporate planning documents (Delivery Program and Operational Plan) are endorsed for exhibition
*	Meeting at which the draft corporate planning documents (Delivery Program and Operational Plan) are adopted
#	Meetings at which the Operational Plan quarterly reviews (March and September) are presented
@	Meetings at which the Delivery Program progress reports (including the Operational Plan quarterly reviews for December and June) are presented
^	Election of Mayor/Deputy Mayor
ü	Meeting at which the 2019- 2020 Annual Statements are presented
∞	Meeting at which any comments on the 2019-2020 Annual Statements are adopted
+	Meeting at which the Annual Report is presented
>	Briefing to consider Budget, draft fees & charges and corporate documents