Understanding the new MSA Levy banner

What is the new MSA Levy?

The Melbourne Strategic Assessment (Environment Mitigation Levy) Act 2020 (the Act) will commence on 1 July 2020. The levy will apply to declared land within the 2010 Urban Growth Boundary and will be used to fund measures to mitigate impacts on the environment caused by the development of land in Melbourne’s growth corridors.

Specifically, the Act establishes the Melbourne Strategic Assessment Fund which can be used for:

  • Acquisition of land, management of land and carrying out of activities on land for nationally protected grasslands and eucalypt woodlands (including the acquisition of a 15,000 hectare Western Grasslands Reserve and a 1,200-hectare Grassy Eucalypt Woodland Reserve).
  • Conservation of native vegetation or matters of national environmental significance (MNES)
  • Carrying out prescribed activities as defined in the regulations
  • Administering the Act
  • Monitoring and reporting on finances.

The Act will introduce an environmental mitigation levy scheme to replace the habitat compensation obligations (HCOs) that arise under the Part 10 Environment Protection and Biodiversity Conservation Act (EPBC Act) approval conditions in many of Melbourne’s growth areas.

As with any legislative change, we know our clients will have many questions. We’ve compiled these FAQs to help you understand what the changes mean for you.

I have questions about the new MSA Levy. Who can I talk to?

The Biosis Environmental Planning team is on hand to talk you through these changes and what they mean for your project. You can contact our team via email or by calling the Melbourne office on 03 8686 4800.

When will the MSA levy start?

The levy commences on 1 July 2020.

What land will be affected?

The levy will apply to the declared ‘Levy Area’. The Levy Area must be inside the urban growth area (as it existed on 6 August 2010). Crown land is also affected.

How do I know if my land is affected?

After the Act commences, there will be a levy recording on your certificate of title. This indicates that a levy payment is likely to be applicable. Our Environmental Planning team is on hand to discuss the specifics of your project and whether or not the levy will be applicable to your project.

How much will it cost?

Table showing costs for the new Melbourne Strategic Assessment Levy

What triggers the levy and who pays?

The levy will be triggered when a ‘specified event’ occurs. For example, when council issues a statement of compliance for a subdivision in the levy area. Some events are excluded, such as smaller subdivisions (e.g. minor boundary realignment).

The tables at section 21 of the Act set out all trigger events and the person liable.

Are staged payments allowed?

Yes, you can apply for ‘Staged Payment Approval’, but this application must be made before the time when the levy is payable.

What happens if I already have a Staged Obligation Agreement under the existing regime?

If you have a Staged Obligation Agreement in place, this will be deemed to be a Staged Payment Approval under the Act. The Secretary must give notice of this transition 14 days after the Act commences.

What are the transitional provisions?

The Levy only applies to land once. The owner will not be liable for the levy on land where habitat compensation obligation (HCO) payments have been legitimately made under the existing regime.

How is the levy assessed and how do I know what my liability is?

The Secretary makes an assessment of the levy liability using the environment mitigation information system (as defined in the Act). You can apply to the Secretary to find out your levy liability.

What if I object to an MSA Levy assessment?

You can ask for a reassessment and you can lodge an objection in writing. You can also seek a review at VCAT if you are unsatisfied with the Secretary’s decision.

Does interest apply?

Yes, if you miss a payment due date you will be charged interest.

Can my levy be reduced if I have a conservation area on part of my land?

Yes. The Secretary (and other public entities) can enter into a land transfer agreement to reduce the levy liability for land in a conservation area.

How will the new levy be enforced?

Authorised officers will be appointed; it will be their role to ensure compliance with the Act.

Will any other Acts be amended?

Yes, a range of other acts will be amended to facilitate the implementation of the levy. These include the Building Act, the Subdivision Act, the Mineral Resources (Sustainable Development) Act and the VCAT Act.

Where can I view the new Act in full?

The Melbourne Strategic Assessment (Environment Mitigation Levy) Act is available on the Department of Environment, Land, Water and Planning website.

Where can I go for additional support?

Email Biosis or give us a call on 03 8686 4800 to discuss how these changes might affect your project – our experienced environmental planning experts are on hand to guide you.

Find out more about the Biosis Environmental Planning Team and the services we offer here.