BioBanking framework

The Biodiversity Offsets Scheme under the Biodiversity Conservation Act 2016 commenced on 25 August 2017 visit Biodiversity Offset Scheme.

The information on this page only remains relevant for savings and transitional arrangements under former legislation and policy. Visit Biodiversity Offset Scheme Transitional Arrangements for more information.

Threatened Species Conservation Act

The BioBanking Scheme commenced in July 2008. The framework for the scheme was established under Part 7A of the Threatened Species Conservation Act 1995 and is supported by the Threatened Species  Conservation (Biodiversity Banking) Regulation 2008, BioBanking Assessment Methodology (the methodology) and Compliance Assurance Strategy.

The term 'biodiversity values' is defined in the Act to include composition, structure and function of ecosystems and includes (but is not limited to) threatened species, populations and ecological communities, and their habitats. The rules made under the scheme will protect biodiversity values but credits will not be required for each individual threatened species.

The main elements of the BioBanking Scheme are:

  • establishing biobank sites on land through BioBanking agreements between the Minister for the Environment and the landowners
  • creating biodiversity credits for management actions that are carried out, or proposed to be carried out, to improve or maintain biodiversity values on biobank sites. The BioBanking assessment methodology will be the tool used to determine the number of biodiversity credits that may be created for these management actions
  • trading of credits, once they are created and registered
  • enabling the credits to be used to offset the impact of development on biodiversity values. The methodology will be the tool that is used to determine the number and class of credits that must be retired to offset the impact of a development and ensure that the development improves or maintains biodiversity values.

Establishment of biobank sites

Landowners enter into a BioBanking agreement with the Minister for the Environment to establish a biobank site. Subject to the regulations, biobank sites can be established on any land.

A BioBanking agreement is a conservation covenant that is attached to the land title. It runs with the land, and generally has effect in perpetuity so as to offset the impacts of development on biodiversity values.

A BioBanking agreement specifies the management actions that are required to be undertaken on biobank sites in order for credits to be created. The Act further provides for the BioBanking agreement to specify the number and class of biodiversity credits that may be created, and the timing of creation. This is determined in accordance with the BioBanking Assessment Methodology.

Management actions are actions that landowners carry out to improve biodiversity values. Examples include controlling grazing, leaving fallen timber on the ground to provide shelter for small mammals, controlling pests and weeds, and plant regeneration.

BioBanking agreements require landowners to report on their compliance with the agreement and specify the entitlement of landowners to management payments from the BioBanking Trust Fund.

Management actions carried out under a BioBanking agreement are exempt from the requirement for development consent under the Environmental Planning and Assessment Act 1979, unless otherwise provided by the regulations. However, the Minister for the Environment will consult with the Ministers for Planning and Primary Industries before signing off on a biobanking agreement.

Once the Minister enters into a BioBanking agreement, the Chief Executive Officer of the Office of Environment and Heritage NSW (OEH) must register the biobank site. The Chief Executive Officer keeps a register of biobank sites including details of the location of the site and a copy of the BioBanking agreement relating to that site.

In limited circumstances, the Minister for the Environment may vary or terminate a BioBanking agreement. Generally speaking, the obligations under a BioBanking agreement can only be varied or terminated if the Minister is satisfied that the variation or termination will not have a negative impact on the biodiversity values protected under the agreement. If the variation or termination does have a negative impact, the Minister may require appropriate measures to be taken to offset the negative impact, such as the retirement of credits.

Biodiversity credits

Biodiversity credits are created by landowners who commit to enhance and protect biodiversity values on their land through a BioBanking agreement. Credits can be created, traded, retired, cancelled or sold to generate funds for the management of the site. More information on biodiversity credits is available under Information for participants.

Special enforcement powers

BioBanking is a major step forward in biodiversity conservation and offers a highly flexible approach, but this flexibility also comes with increased responsibility. For this reason, there are a number of special enforcement powers in the Act. These include a power to enable the Minister to order a landowner to carry out work at their own cost if the work is needed to rectify any breach of the BioBanking agreement.

In addition, any person may bring proceedings in the Land and Environment Court to remedy or restrain a breach of a BioBanking agreement. If these proceedings are brought by the Minister, the Land and Environment Court may award damages for breach of the BioBanking agreement.

Furthermore, the Minister may also apply to the Land and Environment Court for land which is subject to a BioBanking agreement to be transferred to the Minister or another person or body nominated by the Minister. Compensation is payable in these circumstances. There are four activities that would lead to a transfer, where the Court is satisfied that:

  • there is a serious risk to the biodiversity values protected by the agreement because of the contravention of the agreement
  • there is no reasonable likelihood of the landowner complying with the BioBanking agreement
  • the landowner has committed frequent contraventions of the BioBanking agreement, or
  • the landowner has persistently and unreasonably delayed complying with the obligations imposed by the BioBanking agreement.

The Compliance Assurance Strategy outlines how OEH will guarantee that the BioBanking Scheme is implemented lawfully, equitably and transparently and that biodiversity values in NSW are conserved and improved.

BioBanking Trust Fund

The BioBanking Trust Fund is managed by a fund manager appointed by the Minister. When a biodiversity credit is first transferred from one landowner to another (usually on the first sale of the credits) a specified amount is to be paid into the fund. This amount is set out in the regulations and each BioBanking agreement. The money will then be held on trust for the landowner, or the new owners if the land is sold. The Fund provides management payments to the landowner to assist with the cost of carrying out the management actions. The entitlement of landowners to payments from the BioBanking Trust Fund is set out in the BioBanking agreement.

BioBanking statements

Developers can obtain a BioBanking statement from the Director General which confirms the number and type of credits and any on-site measures required for the development to improve or maintain biodiversity values.

BioBanking statements can be obtained for any development, other than the clearing of certain native vegetation that is dealt with under the Native Vegetation Act 2003 or development excluded from the scheme by the regulations. A BioBanking statement can be obtained at any time before the development consent or approval is issued.

A developer may apply to the Director General to have a BioBanking statement modified or revoked at any time prior to the development consent being issued. This allows for the nature of the proposal to change over time as it goes through the planning process. A developer can also apply to have a BioBanking statement modified when applying to modify a development consent. A BioBanking statement will lapse if the development, project or activity has not been approved under the Environmental Planning and Assessment Act 1979 within two years of the issue of the BioBanking statement, unless the statement is extended.

A BioBanking statement may specify conditions relating to onsite measures that must be taken to minimise any negative impact of the development on biodiversity values, and the number and type of credits that must be retired to ensure the development improves or maintains biodiversity values, and the timing of this requirement. The developer is not required to obtain or retire the credits until after the development consent is granted to ensure that developers do not purchase credits unnecessarily.

A BioBanking statement will be issued by the Director General only if the development will improve or maintain biodiversity values. The Director General may also refuse to issue a BioBanking statement where the applicant has not demonstrated that all cost-effective measures are being carried out onsite to minimise any negative impact of the development on biodiversity values. This has been included to discourage developers from impacting habitat where possible.

Some developments will fail to meet the 'improve or maintain' test and thus are not eligible for a BioBanking statement because the type of biodiversity under threat by the proposed development has been significantly over-cleared in the past. This ensures that very rare ecological communities and species are protected.

Interaction with planning legislation

Developers are able to decide whether or not to obtain a BioBanking statement. If they do, this will replace the usual threatened species assessment processes.

After a BioBanking statement is obtained, the consent authority or determining authority must incorporate the credit requirements and any other conditions of the BioBanking statement into the conditions of development consent or approval. While regulation of the development site remains the responsibility of the applicable consent authority or determining authority, the development must be carried out subject to the conditions of the BioBanking statement. The Act provides the Minister with the power to require the retirement of credits in order to ensure that the conditions of a BioBanking statement are complied with. It is an offence to fail to comply with such a requirement.

If a BioBanking statement is refused, developers can still apply for development consent using the normal threatened species assessment provisions. There is provision for a merits appeal against the refusal of the Director General to issue a BioBanking statement or the conditions of a BioBanking statement.

BioBanking Assessment Methodology

The BioBanking Assessment Methodology allows for the measurement of the proposed changes to the condition of ecological communities and habitats, and translates this into biodiversity credits.

The methodology determines both the number and type of credits that may be created for particular management actions, and the number and type of credits that must be retired to offset the impact of a development and ensure that it improves or maintains biodiversity values.

The methodology is based on the biometric and threatened species tools developed for use under the Native Vegetation Act, which is already used in rural areas by Catchment Management Authorities and landholders. Using this methodology, landowners will be able to maximise the number of credits by determining the best areas and the management actions required to include for their biobank site.

The scheme has been designed to complement the Government's natural resource management reforms to end broadscale land clearing. It is built on the sound science that sits behind the Property Vegetation Plan system. The approach to quantifying the biodiversity loss and gain that has been developed for Property Vegetation Plans is the basis for credit calculations under BioBanking.

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Page last updated: 28 August 2017