Planned Retreat from Areas with Unacceptable Risk of Natural Hazards

Introduction

Severe natural hazard events and likely climate change impacts have led to ‘planned retreat’, as a risk reduction approach, becoming increasingly more important and topical in New Zealand.

A recent decision of independent commissioners (the Commissioners) regarding two proposed plan changes to the Whakatãne District Council’s District Plan (the District Plan) and the Bay of Plenty Regional Council’s Regional Natural Resources Plan (the Regional Plan) has effectively enforced a managed retreat from areas at risk of natural hazards in Matatã. This decision has been met with resistance by affected residents and is currently subject to an Environment Court challenge.

This article provides a summary of the Commissioners’ decision and the implications for the affected residents and future planned retreat in New Zealand.

Reasons for the Proposed Plan Changes

Both plan changes sought to address the ‘unacceptably high’ debris flow loss-of-life risk applying to properties on the Awatarariki Stream.

The catalyst to the plan changes being proposed was the 2005 storm event which triggered a significant amount of debris to flow down the Awatarariki stream catchment at Matatã causing significant damage to land, buildings, and road and rail infrastructure on the Awatarariki Fanhead.

Since 2005 the District Council had taken a number of steps including commissioning meteorological reports and investigations to assess the level of risk and engaging with the community. A resulting hazard and risk assessment identified a high level of risk of further ‘debris flow events’ in the area causing significant damage to property and risk to life. Further, despite the community favouring mitigation measures being implemented further up the catchment, various assessments concluded that this was not the most suitable mitigation measure.  

Effect of Plan Changes on Residential Activity & Existing Use Rights

The change to the District Plan creates a Awatarariki Debris Flow Policy Area which manages new development and redevelopment within that area, effectively rezoning the land from residential to hazard risk zones. However this policy did not apply to owners of existing residential dwellings. This was because section 10 of the RMA provides existing use rights for owners of existing residential dwellings to continue to use those dwellings provided the effects of that use remain similar in character, intensity and scale.

Therefore the District Council applied to the Regional Council for a private plan change to the Regional Plan. The plan change effectively inserts provisions which make residential activity a prohibited activity from 31 March 2021. This will have the effect of extinguishing residential activity existing use rights for 21 listed properties in the High Risk Debris Flow Policy Area.

While this appears to be the first time a regional council has made such express rules in a Regional Plan to manage retreat from areas subject to natural hazards, the Regional Council is within its powers to do so and with consequential effects for existing use rights. Section 30(1)(c)(iv) of the RMA provides regional councils with the power to make rules which control the use of land, including prohibited activity rules, for the purpose of avoiding or mitigating natural hazards.  Relevant to the use of this power by a regional council, section 10 of the RMA details that the protection of existing use rights does not extend to a land use controlled by section 30(1)(c)(iv).

Buy Back Scheme

In conjunction with the plan changes, the District Council together with the Regional Council and Central Government initiated a ‘buy back’ scheme with the affected residential property owners. The scheme offers to purchase the affected properties at full market value assuming the hazard risk does not exist.  

The Commissioners supported the ‘buy back’ scheme and found that while the community argued they should be entitled to voluntarily accept the risk, the inevitable loss of homes and property rights for affected owners and indirect social and economic impacts from displacement of part of the community was outweighed by the economic and social benefits from reducing the risk to life.

The Residents' Response

Despite the Commissioners’ decision and their view of the ‘robust and very fair in the circumstances’ ‘buy back’ scheme the affected residents do not support the decision, for a number of reasons, although principally because they want to save their homes. As a consequence, the residents have appealed the Commissioners’ decision to the Environment Court.

What is Likely to Happen in the Future?

Given the increasing risks both arising and becoming better understood regarding climate change, we could see a number of councils around the country taking similar approaches to the Commissioners in this recent decision.

Councils looking to utilise this approach will need to engage in a full and proper process to justify such an approach. For example, robust evidence establishing the risk posed to properties, as well as a thorough assessment of alternative mitigation measures will be required.

In addition, a key issue for councils considering planned retreat from areas subject to unacceptable risks of natural hazards is the question of who pays. There is potential for the recent decision to create an expectation in communities around the country that managed retreat will be funded by local and/or central government. However while the Whakatãne District Council initiated a ‘buy back’ in relation to affected residential properties, this was entirely voluntary as the powers under the RMA to extinguish existing use rights do not mandate an accompanying ‘buy back’ scheme.  

Given the wide-ranging impacts of climate change on parts of New Zealand it is likely to be unaffordable for councils to continually ‘buy back’ affected properties. This raises a serious question as to how planned retreat may be sustainably funded where it becomes a more commonly adopted approach and highlights a potential risk for owners of properties which may become subject to planned retreat in the future.

If you have any queries about this article please get in contact with one of the Adderley Head team.

Disclaimer: This is a brief summary for information purposes only and is not legal advice.

Posted on Thursday 28th May, 2020 at 03:59 pm