The Key Changes include:

New Leasing and Licensing Procedure

The New Policy includes a Leasing & Licensing Procedure as an attachment, which details the three (3) main stages for a leasing / licensing process to guide internal departments and Council with decision making. This allows greater clarity of the overall process and improves the ease-of-reading of the New Policy.

These stages are:

• Stage 1 – Assessment: This stage primarily deals with categorising tenants. Council engages with a wide variety of external organisations and community groups. Categorising them into groups ensures an equitable platform for tenant obligations and fee structures and ease of identification for officers.
• Stage 2 - Standard Terms and Conditions: The standard terms and conditions for all occupancy agreements are broadly contained in three areas. Stage 3 - Council statutory decisions: The New Policy provides an outline of Council’s obligations in accordance with the Local Government Act (Vic) 2020 (which are discussed in Key Change 2 below).

Local Government Act 2020 Requirements

The New Policy details Council’s obligations under the Local Government Act 2020 (LGA) with respect to leasing, including the community engagement requirements.

Prior to offering a new lease agreement, Council is required to comply with the requirements of Section 115 of the LGA, which says:

“115 - Lease of Land

(1) A Council's power to lease any land to any person is limited to leases for a term of 50 years or less.

(2) Subject to any other Act, and except where section 116 applies, if a Council leases any land to any person subject to any exceptions, reservations, covenants and conditions, it must comply with this section.

(3) A Council must include any proposal to lease land in a financial year in the budget, where the lease is—

(a) for one year or more and—

(i) the rent for any period of the lease is $100 000 or more a year; or

(ii) the current market rental value of the land is $100 000 or more a year; or

(b) for 10 years or more.

(4) If a Council proposes to lease land that is subject to subsection (3) and that was not included as a proposal in the budget, the Council must undertake a community engagement process in accordance with the Council's community engagement policy in respect of the proposal before entering into the lease.”

It is important to note that while Council has the ability to offer a lease up to a maximum term of 50 years under the LGA, the New Policy sets out the preferred terms for each of the categories of tenants.

This ensures that Council can consider its service needs and requirements for the whole portfolio and is not locked into long lease agreements which limits Council's ability to review the use of a leased property asset.

Tenant Consent Process

The New Policy outlines a process for occasions when a tenant may need to seek the consent of Council for an action/activity, which is not as of right. For example, a tenant is required to seek the consent of Council for the following items:

Alterations and/or works to the premises, land or the buildings (in addition to any permit requirements that may be required)

Applying for a liquor license

Assignment of agreement

Change of use

Applying for an external grant for building works associated with the premises, land or building.

Any other undertaking outside of the lease or license conditions.

Bringing of heavy equipment or inflammable substances onto the land

Change of shareholding

Variation of permitted hours of operation. Please noteL This list is not exhaustive.

In considering the request, Council will seek advice from many of its internal departments. The level of complexity of the request and/or the financial value will determine whether a Council resolution is required.

Acceptable Behaviours

Tenants occupying Council’s property assets may display behaviours which are either unacceptable, do not align with community standards or are outside of the permitted use as outlined in their occupancy agreement.

Officers do engage with tenants to address unacceptable behaviours, but when this fails, the occupancy agreement is relied upon to rectify a situation, initiate enforcement actions or in some instances the termination of an agreement.

It was identified that this area could be further clarified and strengthened from what was contained in the 2017 Policy, and the New Policy seeks to address unacceptable behaviours.

Removal of 'External Grants' provision under Section 2.7 - Standard Terms and Conditions

Following community consultation, Council has endorsed the removal of this provision in the New Policy as the requirements of this provision are covered under 'Consent for Grant Applications'.

Please refer to the New Policy and Council Report (27 August) for more information.