COUNCILLORS have refused to let go of the axed Newcastle Mines Grouting Fund without a fight, arguing the state government's decision to squash it poses an "unacceptable risk" to the city's revitalisation.
At last week's meeting, City of Newcastle (CN) councillors unanimously backed a "no-brainer" motion calling on the state government to reinstate the fund.
Council will write to Minister for the Hunter Yasmin Catley and NSW Minister for Planning Paul Scully seeking their support.
Liberal Cr Callum Pull said the fund gave developers and investors security against the unpredictable and expensive costs of mine grouting works and put "next to no strain" on the state government's budget.
"When you perform those kinds of grouting works, not only do you have to fill all the mine subsidence at your own site, but also those surrounding sites," he said.
"Which means the first builders have to pay for grouting works for every development that comes after, this fund was designed to correct that inequity.
"By scrapping the fund, unfortunately what it does is creates a massive disincentive to ever be the first person to develop a site."
The fund was established in 2015, and was slashed from $11 million to $6 million in the state budget.
Approved claims will still be funded, but the state government isn't taking future applications, redirecting the uncommitted $5 million to "key government priorities" like housing, infrastructure, renewable energy and essential services.
Lord mayor Nuatali Nelmes said the fund was the result of council investigations into a lack of investment in the city around 2008 to 2009.
One reason was 'land banking', where approved development applications sat dormant on sites without follow-through and another was the impacts of two large mining seams which run through the core of the CBD.
"We know how long it took to actually unlock development in the city, and having Iris (Capital) in the East End, I know they pumped grout into two of those seams for 12 months before they even touched anything to develop, so it is a significant inhibitor," she said.
"The effects of potentially not having access to this fund are not going to be seen immediately, it will be a lag effect, so it will be seen in three or four years time."
Since the fund was established, it has supported eight projects in the Newcastle CBD, with funds granted to three of those to a total value of about $1.1 million.
A fourth project at the Newcastle Art Gallery has been completed, and the final payment claim has been approved.
Greens Cr Charlotte McCabe said the situation was an example of "market failure" and that it was absolutely the government's responsibility to step in.
"Those coal mines and companies made their profits out of the mines under this city, they have packed up and left, they're long gone now and it's the developers and government that are carrying the can and dealing with the sites that they have left," she said.
