Brigid Adams (DEECA): Welcome everyone, my name is Brigid Adams. I'm the Senior manager, Integrated Water Policy at DEECA. It's great to see so many people here attending the information webinar for the DEECA guidance on stormwater quality offsets. So, thank you everyone for joining us.

And of course, now I'd like to start by acknowledging the traditional owners of the land. I'm joining you from the Wurundjeri Woi Wurrung people and pay my respects to their elders past and present.

I'd also like to extend that acknowledgement and respect to all Victorian traditional owners as the original custodians of Victoria's land and waters.

So, the purpose of today's webinar, DEECA developed this guidance to support councils who want to develop an offset scheme to provide flexibility for developers in meeting their stormwater management obligations.

I'll point out that a new version has recently been uploaded to our website as we found a few broken links in the first version, so I'd invite you to download it again.

So now I'd like to hand over to Kanchana Karunaratna and Jeremy Cheeseman from Marsden Jacob Associates, who will take us through the session.

Kanchana Karunaratna (MJA): Thanks, Brigid. Good morning, everyone. My name is Kanchana Karunaratna from Marsdon Jacob Associates, and I'm joined here today by Doctor Jeremy Cheeseman and Jacob Helterby Cook together and in collaboration with DEECA, we're bringing this guidance, overview and webinar to you.

And, and really, we're sort of happy to see this guideline being published and implemented because it's a sort of a long arc to when we first got involved with this idea of stormwater offsets through Jeremy's involvement in the Stormwater MAC back in 2018.

And so, since then, we've been involved developing these offsets with a number of councils as you'll see and hear from today. And, and these guidelines are a combination or a culmination, if you like, of all of the information and knowledge that we've gained throughout.

So, moving on to the agenda of what we want to cover today, as you see there, we will take you through an introduction to the offset scheme guidance, overview of the guidance itself and what's included.

We're not intending to dive into the detail of how to develop an offset, but more give you an overview of what resources are available and, and how to actually use and implement the guidelines that's available.

We will also take you through the key steps involved in developing and studying a storm water offset scheme and some of the sort of key questions and, and issues that may come up.

And we'll also introduce you and highlight, introduce you too and highlight the councils that have already been working in this space and also a really useful resource in collaborating when you actually develop these offsets. And we'll finish with recapping and some next steps.

OK, so a bit of background and context of what we're doing today and to set this up, I will hand over to Jeremy.

Jeremy Cheesman (MJA): Thanks, Kanchana. Hi, everybody. Good to see everybody and so many people interested in this in this topic today and thanks for joining us.

So, I'm going to talk briefly about what the stormwater offsets are and the background and context for why Victorian government look to develop this guidance for stormwater offsets. So, the first starting point is that as many of you know, Victorian councils play a really significant role when it comes to urban storm water management.

So, in Victoria, councils have responsibilities for managing storm water, including enforcing stormwater management through the planning scheme and then this panel and regional councils generally do this as the relevant drainage authority.

One particularly important way that councils implement the stormwater management provisions is under the Victorian planning scheme through building and planning approvals.

And as many of the people on the call will know today, developers in Victoria need to make storm water quality objectives under the VPPs that relate to pretty much most development types in Victoria, whether they be residential subdivisions, apartments, multi dwelling developments, etcetera.

So, what we found historically is that in some cases councils, when developers come to councils, they find that meeting the stormwater quality management obligations on site can be challenging or costly. And that's either to meet it in full or to meet it, say for the last 1010% of the of the stormwater requirements.

This page shows that the water quality standards that developers are seeking to need to achieve on what as part of their as part of their obligations.

So in this context, we found that what we wanted to do and what really was the genesis with working with councils to develop these offsets was a desire to create, provide further flexibility in terms of how stormwater obligations are achieved by developers such that we can achieve sustainable stormwater outcomes.

And, and the, the, the stormwater quality objectives that, that we're looking to achieve in a cost effective and flexible way.

So really in many, in, in many ways, setting up stormwater offsets is about providing flexibility, It's about providing choice and it's providing options for council to deliver better stormwater offset, better outcomes.

So what is the stormwater offset and how do they work? A stormwater offset though is a payment that a developer makes to council in lieu of undertaking stormwater compliance on site either fully or partially.

And so the figure that we have here gives an example of how that of how that works. And you'll find, you'll find this figure also in the in the stormwater guidance that's been put together.

So under the under a stormwater offsetting approach, a council, once they've established A stormwater offset, a developer will approach the council to discuss their stormwater management obligations for a relevant development.

And then council in consultation with the developer can either require that the developer undertakes the stormwater compliance on lot as part of their development or that they can fully or partially offset their stormwater obligation by paying monies to council to discharge that responsibility.

And so that council develops stormwater treatment assets that achieve that stormwater quality objective outcome off site effectively through council run assets.

And as, as we said, as I said earlier on, the way that these councils are setting this up in Victoria is that some councils are offering what we call full offsets. So the developer can offset 100% of their stormwater management obligation through the payment of a, of an inland fee or an offset or a partial offset.

And so for example, some councils have found that it's pretty easy for a lot of developers to achieve say 80% of their compliance, that the last 20% can be difficult. And so in that situation, what councils are doing this are saying we're requiring a certain percentage of compliance on lot and then to bridge the gap to get to full compliance. There's a partial offset that's offered.

The only other point that I wanted to make by way of introduction is that these schemes are voluntary. So they're not a fee or a charge. Developers voluntarily enter into the stormwater offset arrangement.

This next video that we're going to jump to is a vignette where we hear from Anthony Mousley from Mid Valley City Council and he's describing why Rainy Valley decided to implement a stormwater offset scheme.

Anthony Mousley (Moonee Valley Council – video): My name's Anthony from Moonee Valley Council. I am in the role of planning enforcement at the moment. The City of Moonee Valley back in 2014 implemented into their planning scheme stormwater management policy to help developers make compliance.

What we're finding is that most developments were implementing water sensitive urban design measures but they weren't being maintained properly, they weren't being installed properly and they're generally in a broader scheme of things. We're not meeting compliance.

So as an option, Council decided to go down the route of introducing a voluntary contribution scheme to allow developers the option for council to install their own infrastructure or treatments for water sensitive urban design to meet the obligations of setting the scheme.

Overall, developers are thankful that there is an option that complements council's vision. That, that's one thing, but also the benefit has been to fast track some of the council projects that have already been proposed. The biggest benefit is that we're getting better compliance outcomes over time.

The ability of the voluntary contribution scheme allows a developer to install treatments that really complement their own developments and the ones that may not be as beneficial, they can put that on council to implement them more effectively.

Kanchana Karunaratna (MJA) Thanks, Jeremy. So moving on to introducing the offset scheme guidance, as I mentioned earlier, we wanted to take you through the available Council resources and also the supporting educational information.

So this webinar and the vignettes and the Council videos, the full, full videos actually will be made available to you as prepared by DEECA and in support with support from Clearwater is a really important piece or an item in the resources available.

We certainly encourage that collaboration of contacting other councils that have actually either studied the scheme or implemented the scheme and really benefiting from the knowledge that they've gained by doing that pilot study.

Working back on this slide, the other really important council resources that are made available with in line with the guidance and or in combination with the guidance itself is the offset calculator and the prioritisation tool.

So the these two tools allow you to at a high level construct and develop the square meter offset rate, which is a dollars per square meter of impervious area. So these two tools allow you to develop that rate in a standard and standard framework that we've been applying along the way and also being formalized by the Deco guidance to come up with your own initial understanding of what the offset rate would be.

And as I mentioned again, collaborating, once you start that process, collaborating with other councils that have already gone through the process and using this guidance really allows you to develop these things in a standard way.

OK, We will now take you through an overview of the guidance. So basically if we what we wanted to make you aware of is that the offset guidance document and the supporting resources are available online. So we will share this slide deck with all of you after the webinar.

If you scan the QR code that you see there or click on the link below, that will take you to the DEECA website where that information is kept.

In terms of an overview of the guidance itself, you can see Section 1 provides an introduction to the guidance and also the stormwater offsets framework. And Section 2 outlines that Council's role in managing and planning that the planning basis that allows for the offsets. And Section 3 again communicates what those offsets are and what they are not.

So again really important, we won't go into the full details of this, but really important to understand the unique nature of those offsets in the sense that it is a voluntary offset and quite distinctly different from a regulated fee or charge. So it does live and breathe on making sure that those quality obligations at the council takes on board are discharged and actually demonstrating the benefits that are that are that arise out of the offset.

And then Section 4 and 5 describes the steps to establishing an offset scheme. And I think we think this is really valuable because it is a unique framework and it is it sits outside of the regulated frameworks. It is a really important, really important element to make sure that we apply a known and acknowledged transparent framework so that the basis for developing these offsets are robust.

So if I move on to the next slide. So there are three main guiding principles that apply to establishing stormwater offset schemes.

The first one is additionality and this principle asks us to demonstrate how the offset funds are used to invest in ways that are clearly additional to business as usual level of investment.

So in other words, this principle asks us to ensure that the funds are not being used to maintain and operate existing assets or to construct assets that would otherwise be built. We have to demonstrate that they are used. The funds are used to develop additional treatment capacity.

The second principle is permanence, and this principle asks us to demonstrate that the storm water offsets will operate for as long as the impacts last. So in other words, over the longer term period where impacts may occur, and typically that is assumed to be permanent.

The last principle is equivalence and this principle asks to demonstrate that storm water offsets are at least environmentally, environmentally equivalent to managing the storm water quality pact where it occurs.

There's a few steps here that we will take you through. Again, the intent here isn't to really take you through the full steps of how to develop an offset scheme. The, the important thing here is to really make you aware of the various, the resources and the steps that are required and how to actually implement that through the guidelines.

We'll start off with step one, always a very good place to start. Defining eligibility criteria is a key, key first step to say that when we are applying this offset to understand which are the areas within the council that this offset applies. So one is the, is the actual governance boundary. So each council typically will say that this offset is applicable within their own council boundary.

And then within that, there might be logical areas where the offset is excluded. For example, where there are special conditions around healthy waterway strategy and specific catchments where you would not want to apply that offset because there are particular waterway criteria or stormwater strategies that are in place that mean that having an offset available contradicts or conflicts with that.

So you want to make sure that you structure the eligibility criteria accordingly and then identifying off site solutions. Again, this is a really important step in really the council being doing the work to make sure that you're aware of the possible off site solutions that can be developed and can be funded and constructed through the offset scheme.

Again, the guidance really takes you through how to do that and also provides the resources that can get you going. It doesn't also mean that you can't apply your own framework that you may have already developed.

OK. If we move to the next slide, the other important step is to really understand the expectation of development and what the forecast might be in terms of the expected uptake, if you like, of developers taking on board the stormwater offset. And this has a couple of important elements to it. One is really understanding from a council perspective the viability of the office.

So to say, look, if you established this, how soon could you collect sufficient funds to say build your first asset? And of course that's an important thing to understand because if you do establish this, you do want to have a reasonable time frame of, of collecting funds so that you can actually get going and develop an asset.

The other important reason for doing Step 3 is to really understand the type of development expected within your council. So the number of the councils we've worked with have implemented 1 offset right across all developments within their councils.

But by exception, say Hume, they expected that there would be a much higher proportion of commercial and industrial development within their, within their council. So they've actually got 2 rates, one for residential, one for industrial and commercial.

So these sorts of things are important to outline and, and there's flexibility within the framework to apply in that way.

Step 4 is, is a really key analytical step in the process where you you'll be able to evaluate the cost effectiveness of the scheme and also calculate, calculate the offset rate. So again, the guidance and the resources come into play a lot here and we'll take you through what those look like in a in a moment.

But really important to understand that that analytical step, you have a lot of guidance and instruction on how, how that can be applied. And also really using the contacts and the additional information and consultation that's available through DEECA to evaluate and the cost effectiveness and set the set the fee.

We move to the next slide. So this is just a really quick overview. I know this is probably a lot to see, see on the one slide. And again, we don't really want to take you through line by line, but really make you aware that the prioritisation resources and tools exist.

So they're Excel based, very accessible to anyone who's familiar with Microsoft Excel and they use the frameworks that are considered best practice. So where we use prioritization of council assets, we typically take a life cycle cost estimate using both the upfront construction cost as well as the life cycle operating and maintenance cost over one asset life cycle.

And that allows us to prioritize the assets. And the other important thing to note there is that the asset list that you prioritize at the time of study does not have to remain fixed. So you have the flexibility to update and review that asset list on an ongoing basis.

And on the right, that's just a quick snippet of the of the calculator tool itself. Again, we won't go into detail of that, but we encourage you to download it and have a look through to see how the how the guideline, sorry, the offset calculator works. And there are steps in the guideline on, on how to evaluate them and set the fee.

So this slide shows you the QR code and also just a quick snippet of what's available online just for your own benefit.  At the end of this, we'll share, we'll share this slide deck, as I mentioned, and you can scan that QR code and, and it'll take you directly to where the resources are located.

OK, moving on to steps 5 and 6. So Jeremy, are you able to take that?

Jeremy Cheeseman (MJA): All right, so step 5 and 6. So as Kanchana said, this is a 10 step process. The processes are not necessarily sequential they, but they're all steps that we undertake in the process of implementing these types of schemes.

So Step 5, drafting new stormwater compliance processing guidelines. There are probably two key points to make here. Again, this is this is in the documentation, but the first is that it, it would be good so far as possible if the stormwater guidance guidelines are consistent across councils.

And so as part of the resources, we've provided a series of resources so that you can develop guidance using the templates and that will that will help encourage consistent.

Let's see the second key, key point around the around the compliance process is making sure that discussion about offset schemes and options are held available are held as early as possible in the application process.

The reason for that is that we found that when you discuss with developers early the options available to them, councils are getting better out to their outcomes because of that. Again, more details on that in the guidance.

Step 6, internal consultation, seek approval from Council. Look, for us this really is the key of the whole getting a stormwater offset scheme to work. There are technical components to us setting up a stormwater offset scheme, but really having the right people and bringing the right people through the process in developing A stormwater scheme is really, really important.

And so what we would encourage is that people from finance, planning, environment and other parts of the of the organization are brought through and engaged throughout the process as the stormwater offset is being developed. So that people understand what it is and how it's potentially going to benefit councils and how it's going to benefit developers and also ultimately the environment by achieving potentially better stormwater outcomes.

We move after we've sort of internal approval the next step. And again, these are not necessarily sequential, but they're all steps to undertake, is to undertake external consultation and fix to seek feedback on the proposed scheme.

Now again, what's important here is knowing and understanding you of the type of developers that councils are working with and when it's going to be best to engage with them. So with some councils we've worked with, councils have engaged with developers upfront to get a sense of whether developers would support this type of scheme and whether they would use it before they actually went through and started to develop it.

But once they got that clear line of sight from developers, then they moved through. Others will wait until the scheme is developed and set up before sharing it with before sharing it with developers.

So the main point here is there isn't A1 size fits all, but engaging with the developers so that they're aware of the offset scheme, they're aware of how it's going to work and how it's going to benefit is, is, is an important step in the process.

And again, the resources that we, that we provided. And also, if you go out on to some of the websites of councils who have already set up offset schemes, they have fantastic resources that they've developed to, to inform developers around the around the offset scheme. And those are available for repurposing by other councils who may be looking at to set up the scheme.

Step 8, we move on to setting up fund administration reporting in governance. Really, look, the main thing that I wanted to emphasize here is that funds collected in the stormwater offsets through stormwater offset payments are ring fixed.

So they don't go into general consolidated revenue, they go into a special purpose account that's managed under the requirements of the Local Government Act so that all money in the account is used solely for the provision of infrastructure investments and the maintenance of those assets to meet or exceed the storm water offset obligations that have been transferred to council.

Just moving on to Step 9. Can we get into the, the sort of I guess what you would call the end game of the scheme? So we set up on the step line, we set up the storm water offset scheme.

Typically what we've found with all the councils that we've worked with and all of the councils that have set up their schemes independently is that councils set up these schemes as a pilot for a period of one or two years and that allows them to effectively learn as they go.

So they've got a couple of years of piloting before formal abduction where they can see uptake rates, where they can see the type of developers who are coming forward seeking offsets and where they can make sure that they've got the confidence the scheme can be administered in a way that is going to allow them to achieve the stormwater offset obligations that they've taken on.

And, but we, we strongly endorse that it provides additional flexibility rather than moving straight into, rather than moving straight into it being a, an established scheme.

And then the last step once we've set up the stormwater offset scheme is to monitor, evaluate and report, you know, as a standard of all good, all good programs. But in our view, best practice would involve reporting and recording the stormwater offset monies that have been received by the council, the investments that the council has made using those stormwater offset fund funds.

And then finally, also in in an ideal world, the level of storm water, the level of stormwater quality abatement or treatment abatement that's been achieved through those assets.

All right, so that's the ten steps. And we'll just now jump into a short presentation that can give you that's going to provide some tips for developing schemes.;

Naomi Clark (Merri-bek council - video) My name's Naomi Clark. I work for the Merri-bek City Council, and my role is Integrated Water Management Officer.

The advice I would give to another council who's considering looking at an offset scheme would be to first have a chat with your planning team and get a collection of recent developments. Have a look at what type of treatments are typical and what kind of challenges those development applications are facing when it comes to achieving water sensitive outcomes.

I would also recommend having a really good think about who needs to be part of the conversation. So, you might have your sustainability team, your drainage team, your planning team, open space team. I would recommend getting them in early.

Stormwater offsets might seem like a concept that you might understand, but it can be a bit of a learning journey for the rest of council.

Kanchana Karunaratna (MJA) Thanks, Jeremy. So as, as I said just then, the collaboration element of this I think is really important. We've developed this offset guidance and also the framework really through collaboration itself.

You can see here that there are a number of councils that have studied and implemented the scheme and there are about 8 more councils that are investigating and, and we've been fortunate to work with all of those councils up to date and to develop and improve upon this framework as we've progressed.

And we encourage anyone who actually approaches this again and all starts evaluating this, this offset for yourselves to really get in touch. There is a long list of contacts that are available from each of the councils and they're happy to discuss and provide feedback, both good and bad that help you along the way. So that's what we really wanted to articulate there.

Again, the those that are implemented there, there's a website for each of those. We also encourage you to jump onto those websites and have a look at how they have published and also looking at things like piloting and implementing.

There's a lot to learn there from councils that have already implemented, so here another excerpt from an interview we did with Dominic Noonan O'Keefe from the Shire of Mornington Peninsula.

Dominic Noonan O'Keefe (Mornington Peninsula Shire – video): My name is Dominic Noonan O'Keefe and I'm the Water and Coast Officer at the Mornington Peninsula Shire, responsible for water sensitive urban design and integrated water management.

If we were starting the process again and some and adopting some lessons learnt, it's really easy to say that looking back, it would have been brilliant to have some shovel ready projects ready to go once the funds accumulated. They're all lessons learned.

They're all improving our scheme, our delivery. The project control group is well aware of it. So, they're great lessons learned, but it's just one of those wish listings we would have wanted.

Kanchana Karunaratna (MJA): Thank you. So, I'll hand over to Brigid now just to take you through the recent planning amendments that also have an attachment or is something to be considered when developing the offsets?

Brigid Adams (DEECA): Thanks, Kanchana. I just wanted to note that the changes to Clause 55 and the introduction to the deemed to comply pathway for townhouse and low-rise developments has removed reference to offsets, which is causing some councils to have a few concerns.

So DEECA is in discussion with DTP to potentially reinstate this reference as offsets do offer greater flexibility for developers and can result in better environmental outcomes. So further information on those discussions will be shared as it becomes available.

But in the meanwhile, BlueFactor, which is the STORM upgrade has incorporated offsets. So, applicants can still achieve that 100% storm score and continue down the deemed comply pathway. Other tools may also offer that functionality. And now I'll hand back to Kanchana.

Kanchana Karunaratna (MJA): Thanks, Brigid. So, we've given you an overview of what the guidance includes and really just wanted to recap what we presented to you today.

And really this, this isn't the end of that information, if you like, really it's an introduction and, and the start of a process where you can really access additional information through the key contacts there, as well as certainly reading through the guidelines, guidelines themselves and also the resources available.

So, what we wanted to do today obviously is to describe the purpose and the principles and also be able to give you some information so that you can confidently navigate and interpret the stormwater offset guidance important to also understand the steps.

And I think that's a really important thing to reiterate that, that applying this standard framework really gives rise to, to be able to eat for each council to really develop these yeah, in a standard way that that enables these offsets to be used over the long term. And again, the last important point is to understand that it is a collaborative process.

And, and the more we learn from councils that have already implemented these, the better we are as a as a community and, and certainly we can actually feed that back into the framework and improve that as we go.

So that brings us to the end of the formal part of the presentation. So, thank you very much to Brigid from DEECA Clearwater and the Marsdon Jacob team. Thank you very much for attending the stormwater quality offset schemes guidance webinar.

It's been really interesting and really happy to see the publication and the and the publishing of the guidelines through all of the work that we've done to date. I'd really like to thank Brigid and the team from DEECA Steph and the team from Clearwater.

Jeremy, Jacob and Amanda from Marsdon Jacob Associates, and thank you again for attending this webinar. And if you have any further questions, please feel free to get in touch. Thank you very much.

Brigid Adams (DEECA) Thanks, everyone.

Jeremy Cheeseman (MJA) Thanks.

Page last updated: 05/12/25