Central Coast Council has sought legal advice and is considering taking action in the NSW Supreme Court to have the former Gosford Council’s Protection of the Environment Trust (POET) wound up.
Coast Community News understands that the three members of the POET management committee have informed Council, on numerous occasions, that they believe it is not in the community’s interests for the trust to be wound up.
The new Council has twice attempted to abolish the trust since May 12, 2016, initially as part of its abolition of all former community committees.
A resolution was put to Council Administrator, Mr Ian Reynolds, to wind up three trusts of the former Gosford Council at the September 28, 2016, ordinary meeting.
That resolution was deferred by Mr Reynolds, who requested a further report from Council but, to date, the matter has not come back before the Administrator.
Mr Reynolds resolved that he needed to seek further information, particularly in relation to facts illuminated by speakers regarding POET, after two speakers argued against the winding up of the trust.
According to the report prepared by the unit of the Chief Executive Officer, Mr Rob Noble, the Gosford City Council Protection of the Environment Trust was established in 2006 to promote the protection and enhancement of the natural environment, or of a significant aspect of the natural environment, and in particular the conservation of flora and fauna indigenous to the Local Government Area.
POET was also established as a means to fund the provision of information or education or the carrying on of research about the natural environment.
On October 3, 2006, the former Gosford Council resolved to “transfer the sum of $1.5m from funds generated from the bonus provisions of subdivision of 7(c2) lands, into a special interest bearing account to be administered by Council’s (then) newly established Gosford Sustainability Environmental Trust.
“The annual interest from this investment (approximately $65,000), was allocated by the Trust annually to specific environmental projects, following an application process,” the October staff report said.
Ms Jane Smith, CEO of the Community Environment Network and a member of the POET management committee since 2010, was one of those speakers at the September Council meeting.
Ms Smith said the report had failed to explain that the trust was set up as an outcome of the Somersby Industrial Park plan of management which was coordinated by NSW Premier’s Department to address the conflict between the site’s perceived value as an industrial site and the fact that it included Indigenous sites of national significance, as well as endangered species.
The money held by the trust, according to Ms Smith, was initially intended to compensate land owners who were unable to develop Somersby sites because of their cultural and/or ecological significance.
The trust was also established, Ms Smith said, to have Australian Taxation office status, which meant land owners could donate land to the trust and receive 100 per cent of the land’s value as a tax deduction over five years.
She said lands donated to the trust, under trust law, should remain the property of the trust, and she did not believe it was a simple matter of stating in a report that the lands were held on behalf of council.
She said the trust may have also, from time to time, held monies received from developers as offsets to compensate the community for developments that may have been approved at the expense of Ecologically Endangered Communities.
As for the trust’s property holdings, Ms Smith said she believed parcels of land had been donated to the trust “from all over the [former] Gosford Local Government Area as recently as 2014-15”.
Ms Smith said the Somersby Industrial Park Plan of Management had cost council $500,000 and taken three years to formulate, and its stakeholders, including the NSW Premier, recommended the establishment of POET.
The plan of management had been tested in the land and Environment Court and the Court of Arbitration, according to Ms Smith.
The trust deed specified that the trust was to be wound up after 80 years and prescribed the process by which that winding up was to occur.
The winding up provisions of the deed can only be altered by the creation of a new trust deed.
Prior to the council amalgamation, members of the POET management committee had requested that former Gosford Council provide legal advice about the impact of the amalgamation on the trust.
That advice was never forthcoming.
The committee made numerous requests for a POET meeting after the formation of Central Coast Council, but ended up having a meeting outside the Gosford Chamber building in January, in accord with the Trust Deed, which required a quorum of three.
Council staff, Mr Reynolds and Mr Noble, were invited to attend the meeting but did not do so.
Following a subsequent ordinary council meeting, members of the POET Management Committee were able to secure an “on-the-spot” meeting with Council staff, in particular about the small grants that the Committee had agreed to for the 2015-16 year that had not been processed by Council.
It is understood that Mr Julie Vaughan, Council’s Group Leader Connected Communities, agreed to take carriage of the payment of the grants.
At a subsequent meeting, Ms Vaughan informed members of the POET committee that it was still Council’s intention to have the trust wound up, that Council was getting legal advice but would not share that advice with the committee.
The meeting was confrontational with the POET management committee’s expressing its belief that the trust should continue in accordance with the trust deed.
The trust account is understood to contain around $500,000.
Council has commenced paying some of the small grants approved prior to amalgamation, but is refusing to pay one sum approved by the Management Committee.
The committee has requested that the $1.5 million capital that “feeds” the trust should be shown in the trust’s financial statements.
It has also requested that all real property held in the trust be classified as community land so it cannot be sold without reclassification, and that it be given an environmental zoning.
Some parcels of land, particularly at Somersby, are understood to still have an industrial zoning, but all are understood to be classified as community land, which means that they could not be sold without community consultation.
The reason why no reference was made to the trust’s land holdings in the September 2016 report to Mr Reynolds are unclear, but are understood to be more a case of staff not being fully across the operations of the trust than any intent to mislead the Administrator.
POET currently has six parcels of land, but the Management Committee has not been given any book values for those parcels.
The committee has expressed its concerns about Council intending to take Supreme Court action.
It has asked for all copies of legal advice on two occasions, but such documents have not been made available by Central Coast Council.
The POET Management Committee said it was not aware of any correspondence between Council and donors to the trust about the implications any winding up might have on their ability to collect the tax benefit over five years.
In a written statement Central Coast Council said: “Council is considering external legal advice and a report will be provided to the Council shortly concerning the trusts”.
Source:
Meeting notes, May 31
Protection of Environment Trust Management Committee
Agenda item 3.5, Sep 28, 2016
Meeting notes, Sep 28, 2016
Central Coast Council ordinary meeting
Trust Deed, POET
Media statement, May 31
Central Coast Council media
Jackie Pearson, journalist