NSW: What are the technical requirement of a sustainability infrastructure resolution

This article is about the technical requirements for a sustainability infrastructure resolution in NSW, including the mandatory considerations that must be addressed before it can be passed.

Part 1: NSW: Authorising works to the common property and the resolution is required

Part 2: NSW: What is the test to determine if work is a repair or an upgrade?

Part 3: NSW: What are sustainability infrastructure motions? How are these resolutions changing how works are authorised?

Part 4: NSW: The far ranging nature of sustainability infrastructure, no it is not just technology improvements

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There are considerable advantages to having motions classified as sustainability infrastructure motions however these motions have technical requirements that must to be met. This part 5 of my Sustainability Series dives into these requirements.

The most important, but surprisingly most often overlooked, requirement is that the motion would in fact be a sustainability infrastructure resolution if passed. These are set out in s132B of the Strata Schemes Management Act 2015 (“Management Act”) and are resolutions to:

Finance sustainability infrastructure;

Add to or alter the common property or to erect a structure on the common property for the purpose of installing sustainability infrastructure; and

Amend by-laws for the purpose of the installation or use (or both) of sustainability infrastructure;

(I will not detail what falls into the category of sustainability infrastructure, please see parts 3 and 4 of my Sustainability series for this.)

Provided the resolution would fall within these parameters then before the motion is considered a motion must first be passed to consider the following:

the cost of the sustainability infrastructure and works including any expected running and maintenance costs,

who will own, install and maintain the sustainability infrastructure,

the extent to which the use of the sustainability infrastructure will be available to all or some of the lots in the strata scheme,

and any other matter that the regulations may prescribe must be considered (currently there are none).

These are mandatory considerations and without passing a motion (or potentially motions) setting out these items, the sustainability infrastructure resolution cannot be passed. For ease, I am going to call it the mandatory consideration motion.

The owners corporation may want to have motions for each of the costs, ownership and responsibility and accessibility / availability considerations or it may have one omnibus by-law setting out all of these factors. Having one omnibus resolution for each sustainability infrastructure resolution ensures that the pertinent information is kept together. This would be important if there is more than one sustainability infrastructure resolution.

Where the resolution is to approve the installation of a solar panels to service a single lot by a lot owner the mandatory consideration motion is relatively simple as the lot owner will generally have a quote for the work so their costs are known, they would own the works and be responsible for their installation (through their contractor), cost, repair and maintenance. Similarly, the availability of the solar panels and the energy created is known in that it is only available to the lot owner. Even when solar panels are installed by an owners corporation the mandatory motion considerations can generally be foreseen. For instance, where a behind the grid system is being contemplated the provider will generally have a detailed proposal setting out the technology, how it works, how it will be installed, its costs and estimated running costs and availability to occupants and the owners corporation.

What may not often be thought of, but which should be included as part of the costs equation in a mandatory consideration motion, is the cost of any ongoing subscriptions required to manage or access the infrastructure. For instance, if an EC charging station is to be installed for use by occupants will they need access to an app or subscription service to book a charge, monitor the charge in real time, receive notifications about availability or charge progress and to pay for the energy used?

The location of the sustainability infrastructure is also important to consider as it may affect accessibility. Passing a mandatory consideration motion that states the new worm farm and composting system would be available to all occupants may be inaccurate. Suppose the work farm and composting system are on the common property roof. Generally, this would not be a problem. However, is the roof accessible to all occupants? Where the scheme is a mixed use one and commercial lots only occupy the ground floor of the building it is relatively common for a by-law to be in place giving the residential lots the exclusive use of the elevators. The purpose behind such a by-law is to require the residential lots to pay the going maintenance, repair, renewal and replacement costs of the elevator. However, in this example it would prevent commercial lots from accessing these facilities. For this reason, care needs to be taken when crafting the mandatory considerations motion.

Of course, not all restrictions or limitations will be known at the outset and so the disclosure obligation is to disclose what is known about the costs, ownership, responsibility and availability.

The importance of making our strata and community schemes more sustainable has been a key consideration in legislative change and particular attention has been paid to ensuring schemes are aware of the costs of implementing sustainability infrastructure. Amendments have also been made to restrict the ability of owners corporations to refuse sustainability infrastructure works by-laws. More on this new by-law restriction in part 6 of this Sustainability Series.

Please seek legal advice that is tailored to your situation because as always, the devil is in the details and this is general information only.

Allison Benson
Kerin Benson Lawyers
E: allison@kerinbensonlawyers.com.au
P: 02 4032 7990

This post appears in Strata News #781.

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This article has been republished with permission from the author and first appeared on the Kerin Benson Lawyers website.

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