New Crown Land Management for NSW – an opportunity for local government?

by | Jan 1, 2017

UPDATE: The Crown Land Management Act 2016 commenced on 1 July 2018.

Read more about the how to get ready for the new Act in our latest article.

On 14 November 2016 the biggest ever overhaul in Crown land legislation was assented to by the New South Wales parliament. This legislation, the Crown Land Management Act 2016 (CLM Act), has had a long incubation period and is a welcomed reform for the local government sector. It will replace eight separate pieces of legislation currently governing Crown land.

The CLM Act represents a significant opportunity for local councils to take direct ownership of Crown land that has local value. It also simplifies the processes for councils managing Crown land in the future. Councils will benefit from an early and thorough analysis of their landholdings to determine the best strategy to comply with the requirements of the CLM Act. This article considers the implications of the CLM Act for local councils.


In June 2012 the Government started a comprehensive review of the management of Crown land, being the first of its kind in 25 years. The Crown Lands Management Review (the Review) contained 36 recommendations to improve the management of Crown land. Legislative reform was identified as a key priority, as was the need to empower local government to better and more easily manage Crown land that is valued primarily by local communities.

In February 2014, the Government released the Crown Lands Legislation Review White Paper (White Paper). The Government supported the majority of recommendations in the Review and also noted the need for co-ordination with other reforms in the local government and planning sectors. Much progress has been made on that front in the past two years including amalgamations as well as new biodiversity and coastal management legislation. 

Public consultation on the White Paper and the Review closed in June 2014 and was followed by a public hearing in 2016 – together attracting more than 1,000 submissions. Despite the number of submissions, the reforms have since gone largely under the radar, perhaps being overshadowed by the Government’s significant reform agenda. 

After four years in the pipeline, the new CLM Act was passed by parliament in late 2016 but most is not yet in force. The majority of the legislation will come into force in early 2018.  For now, the existing legislation remains in place. The important exception is Division 4.2 of the CLM Act, which relates to transfer of land to local councils, which came into force on assent.

Transfer of local land to local councils

The Review identified that only certain types of Crown land are of state significance. A large portion of Crown land (more than 7,500 Crown reserves) is of local value and already managed by local councils as the reserve trust or as a reserve trust manager under the existing Crown Lands Act 1989 (CL Act).

The White Paper noted that the existing system for management of Crown land by local councils can be confusing as land owned by local councils is managed under the Local Government Act 1993 (LG Act). This is particularly the case where council owned land is contiguous with Crown land within a single public open space for example. The two Acts have different management requirements, which means that adjacent land cannot be formally managed as one entity and that one plan of management cannot cover both a Crown reserve and a council’s community land.

One of the key changes under the CLM Act is that ownership of Crown land may be transferred to local councils if the Minister is satisfied the land is suitable for “local use” (section 4.6(1)(d)). In making this decision the Minister must take into account the criteria to be prescribed in the regulations. These regulations are not yet available but presumably will be based upon the criteria developed for ‘local land’ over the past two years.

These criteria were road-tested during 2015 in a pilot conducted with four councils. The pilot found that there was support for the implementation of the local land transfer concept. As a result, the local land criteria have been tweaked and are now stated in the Department’s “Fact Sheet on Best owners for the land: local interests to be managed locally”.

Importantly, the transfer of ownership of Crown land to local councils will be voluntary and require council’s agreement (section 4.6(1)(b)). The transfer will also be subject to the existing regime of land claims under the Aboriginal Land Rights Act 1983. As a result, any negotiations about proposed transfers of Crown land will take place with local councils and Aboriginal Land Councils.

Once land is transferred into council ownership, the decision making about the management of that land will be made in accordance the LG Act.  This reflects the finding in the Review that local government can manage local land more efficiently under its own legislation, rather than under the CL Act.

Importantly, land transferred to councils will generally be placed under the ‘community land’ classification under the LG Act (section 4.8(1)). This land will be subject to the strict management requirements under the LG Act. It also means that the land cannot be sold by councils without reclassifying the land to ‘operational’. Only in limited circumstances will land be transferred to council as ‘operational’ (section 4.8(3)).

Council’s will be entitled to any income generated from the land (section 4.9(7)) and will become responsible for any leases or licences (section 4.9(6)(f)).

This represents a significant opportunity for local councils to take direct ownership of Crown land that has local value to their communities and to simplify the management of public land in the future.

Crown land managed by local councils

As noted above, the transfer of Crown land of local value to councils is voluntary. The Government will not be able to force councils to take ownership of the land. This means that there may still be many parcels of Crown land that continue to be managed by councils.

The important difference is that the CLM Act will enable councils to manage Crown land under the LG Act (Division 3.4) rather than under the new CLM Act. This reflects the Review’s finding that the current system is too complex and the dual legislation leads to duplication and confusion. This change has been welcomed by the local government industry, particularly where ownership is not desired. 

Like an owner, under the CLM Act councils managing Crown land will have the obligation to classify and manage the land as if it were public land within the meaning of the LG Act (section 3.21). Again, councils must generally manage the Crown land as if it were community land (section 3.22(1)(a)), inclusive of restrictions for leasing and licensing (section 3.22(1)(b)). Importantly, councils will not be able to sell the land (section 3.22(4)(a)) or classify the land as operational without the consent of the Minister responsible for Crown land (section 3.22(4)(b)). As such, safeguards will continue to be in place to prevent the disposal of public land, which was a concern raised during the submission process. 

Similarly to council owned land, councils will also need to:

  • categorise any Crown land that is managed as community land in accordance with the LG Act (section 3.23(2))
  • adopt an initial plan of management for this land which complies with the majority Division 2 of Part 2 of Chapter 6 of the LG Act (section 3.23(6)).

There will be a three year phase in period of this last requirement.

Implications for local councils

The changes to be introduced by the new CLM Act have significant implications for the management of public land by local councils in the future. In practical terms there are a number of steps that councils should start to implement now to prepare for the imminent changes. Most relevantly, councils should be carrying out an audit of the Crown land they currently manage or which is located in their LGA to determine whether the land fits the ‘local land’ criteria. If yes, councils will then need to undertake a strategic assessment to decide whether it is desirable to take on the ownership of this land or whether it is preferable to retain the Crown land status. This will inevitably require consideration of the community’s views, as well as the financial, legal and risk implications of either scenario.

In either case (ie whether land becomes owned by councils or is continued to be managed as Crown land), councils will need to identify:

  • whether the land should be classified as community or operational land
  • the category of any community land
  • how the initial plans of management will be prepared and adopted

Councils will benefit from an early and thorough analysis of their landholdings to determine the best strategy to comply with the new requirements of the CLM Act.

Our team includes staff who are highly experienced with the management of public land from a compliance and strategy/planning perspective.  For more information about our strategy and planning services, please contact:

Steve Thompson Director Planning and Strategy

Steve Thompson

Director - Planning and Strategy

T   0419 700 401


Disclaimer: This publication is provided in good faith and is for general information purposes only. This publication does not constitute legal advice or other professonial advice, and must not be relied upon. You should seek legal or other professional advice in relation to matters arising out of the publication having regard to your circumstances and needs. No warranty or representation regarding the reliability, quality or accuracy of any information in this publication is given by Locale Consulting or the authors of the publication.

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