Explanatory note
This explanatory note relates to this Bill as introduced into Parliament.

Overview of Bill

The object of this Bill is to amend the Nature Conservation Trust Act 2001:

(a) to require the Nature Conservation Trust of New South Wales (the Trust) to
establish and maintain a public fund, so that donations to the Trust for its
principal purpose are eligible for tax deductible status under Commonwealth
taxation law, and

(b) to clarify that the Trust has similar functions with respect to water as its
functions with respect to land, including by authorising the Trust to deal in
water access licences and similar entitlements, and

(c) to authorise the Trust to sell, without imposing a covenant, any part of land that
it acquires that is unsuitable for conservation purposes, and

(d) to expressly permit Trust agreements to impose restrictions on the subdivision
and other development of land, and

(e) to make further provision for the skills and experience required of
non-government members of the Board of the Trust, and

(f) to provide for a further review of the Act in 5 years' time.

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Nature Conservation Trust Amendment Bill 2010
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The Bill also amends the National Parks and Wildlife Act 1974 to make it clear that
conservation agreements may make provision for the protection, conservation and
management of waters (as well as land).

Outline of provisions

Clause 1 sets out the name (also called the short title) of the proposed Act.

Clause 2 provides for the commencement of the proposed Act on 1 February 2011.

Schedule 1 Amendment of Nature Conservation
Trust Act 2001 No 10
Establishment of public fund
The amendments require the Trust to establish and maintain a public fund for the
principal purpose of the Trust. The public fund is to be called the Nature
Conservation Trust of New South Wales Public Fund (the Public Fund).

The amendments make it clear that the Trust has a single object, which is to protect
and enhance natural heritage (including any cultural heritage associated with natural
heritage). The object of the Trust is also its principal purpose.

The purpose of the amendments is to ensure that donations made to the Trust, for its
principal purpose, are tax deductible under the Income Tax Assessment Act 1997 of
the Commonwealth (the Commonwealth Income Tax Assessment Act). For
donations to the Public Fund to have tax deductible status under the Commonwealth
Income Tax Assessment Act, the Trust must have as its principal purpose the
protection and enhancement of the natural environment or a significant aspect of the
natural environment.

The amendments include a number of other provisions the object of which is to
ensure that donations to the Trust for its principal purpose meet the requirements for
tax deductible status. These include:

(a) a provision that makes it clear that the affairs of the Trust are to be conducted
on a not-for-profit basis and that the Public Fund is not-for-profit, and

(b) a requirement that all gifts of money or property made to the Public Fund for
the principal purpose of the Trust, or other contributions made in relation to
fundraising events for that principal purpose, be held in the Public Fund and
are used only for that principal purpose, and

(c) a requirement that the Trust not agree to any condition imposed on a gift to the
Public Fund (so that a gift can be used only for the principal purpose of the
Trust, rather than on the basis of donor preferences), and

(d) a requirement that the Trust comply with any other requirements made of it
under the Commonwealth Income Tax Assessment Act, including by
complying with rules made under that Act and by providing statistical
information about gifts or contributions made to the Public Fund, and

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Nature Conservation Trust Amendment Bill 2010
Explanatory note

(e) a requirement that, on a winding up of the Trust, all outstanding property held
in the Public Fund is to be transferred to another fund with tax deductible
status and a similar principal purpose.

The principal amendments described above are contained in Schedule 1 [2], [6],
[12], [17] and [22]. Schedule 1 [7] makes changes to the functions of the Trust that
are consequential on the new provisions relating to the Public Fund. Schedule 1 [1]
inserts definitions used in the provisions. Schedule 1 [11] and [12] also replace the
term "gift, devise or bequest" with the more general term "gift", so that the new
provision that prevents the Trust agreeing to a condition of a gift of money or
property that is to be made to or held in the Public Fund will also apply to a devise
or bequest, if the devise or bequest is a gift of money or property that must be held
in the Public Fund under the Commonwealth Income Tax Assessment Act.

Schedule 1 [21] removes a provision made redundant by the amendments.

Schedule 1 [5] and [9] are consequential amendments.

As the Trust already maintains trust accounts, it is necessary to distinguish these
accounts from the Public Fund. The amendment in Schedule 1 [18] renames the
existing trust accounts as operating accounts and makes it clear that these accounts
are to be kept separate from the Public Fund. The operating accounts can be used for
the receipt of any money paid to the Trust that is not required to be held in the Public
Fund (such as borrowings) and to meet its liabilities (for example, remuneration of
Board members).

Water management
At present the Act gives the Trust certain functions in respect of land that is
significant for the conservation of natural heritage. Schedule 1 [1] inserts a definition
of land into the Act to make it clear that land includes water on or under the surface
of land. Accordingly, any of the functions of the Trust with respect to land extend to
water on or under the surface of land.

Schedule 1 [6] also includes a provision that makes it clear that any arrangements
entered into by the Trust with landholders can include arrangements for the
management and protection of waters that affect the natural heritage of land. This
may include waters not actually situated on the land to which the agreement relates.

Schedule 1 [8] authorises the Trust to buy, acquire, sell, hold, create security
interests in and otherwise deal in access licences and other entitlements with respect
to water under the Water Management Act 2000 and the Water Act 1912.

Schedule 1 [10] is a related amendment.

Use of covenants under revolving fund scheme
At present the Trust operates a revolving fund scheme. Under the scheme, the Trust
purchases or acquires land that is significant for the conservation of natural heritage,
arranges for a covenant to be registered on the title to the land that protects that
heritage, and then sells or leases the land subject to the covenant.

Schedule 1 [4] will authorise the Trust to sell or lease part of any land acquired,
without arranging for a covenant to be registered on the title to that part of the land,

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Nature Conservation Trust Amendment Bill 2010
Explanatory note
if the Trust decides that the part of the land concerned is of low or no conservation
value. Schedule 1 [3] is a related amendment.

Contents of Trust agreements
Schedule 1 [19] permits Trust agreements to contain provisions that restrict the
development of land the subject of the agreement. Development is given the same
meaning as it has in the Environmental Planning and Assessment Act 1979, which
includes the use of land, the subdivision of land, the erection of buildings on land and
the carrying out of work on land. At present, only restrictions on the use of the land
are expressly permitted (however, agreements can provide for any matters which the
parties consider appropriate). A related amendment in Schedule 1 [20] makes it clear
that a Trust agreement can include provisions that require a landholder to refrain
from carrying out specified actions (such as development).

Membership of Board of Trust
The requirements for membership of the Board of the Trust are modified, to make it
clear that a non-government member must have skills and experience (rather than
capacities) in one or more of the following areas:

(a) increasing public knowledge, understanding and appreciation of the
importance of natural and cultural heritage by private landholders and other
community members,

(b) protection and conservation of natural heritage,

(c) protection and conservation of cultural heritage,

(d) management of natural resources, including agricultural land,

(e) land use planning and operation of local councils,

(f) marketing and fundraising,

(g) economics and financial management,

(h) governance and administration,
        (i) decision making and leadership.

The principal amendment is Schedule 1 [14]. Schedule 1 [13], [15], [16] and [24]
are related amendments.

Schedule 1 [25] repeals a provision that allows members of the Board to appoint
deputies.

Review of Act
Schedule 1 [23] provides for a further review of the Act to be carried out 5 years after
the date of assent to the proposed Act.

Savings and transitional
Schedule 1 [27] enables the making of savings and transitional regulations as a
consequence of the amendments.

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Nature Conservation Trust Amendment Bill 2010
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Schedule 1 [28] inserts specific transitional provisions relating to the amendments.

Schedule 1 [26] is a consequential amendment.

Schedule 2 Amendment of National Parks and
Wildlife Act 1974 No 80
Schedule 2 [1] makes it clear that conservation agreements entered into under the
National Parks and Wildlife Act 1974 can contain provisions for the purpose of the
protection, conservation or management of waters.

Schedule 2 [2] is a consequential amendment.

Note: If this Bill is not modified, these Explanatory Notes would reflect the Bill as passed in the House. If the Bill has been amended by Committee, these Explanatory Notes may not necessarily reflect the Bill as passed.

 

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