The plan change, which will now be publicly notified, would introduce new inclusionary zoning policy requiring residential development and subdivision to pay either a monetary or land contribution to the council.
The policy will apply to subdivisions within residential zones that result in more than one new lot, and developers will be required to contribute 5% of the estimated sales value.
The contributions would fund the construction of affordable housing for low to medium income people, primarily through Queenstown Lakes Community Housing Trust (QLCHT).
In a report presented at Thursday’s full council meeting, housing affordability was labelled "a significant issue" in the district, due to high median house prices coupled with average household incomes.
The meeting’s public forum saw the housing trust chief executive Julie Scott commend the proposed policy, while Kinloch businessman John Glover said the model would "tax those who are actually providing housing".
He said as council was not proposing to tax the businesses and tourism operators, "who’s rapid growth in the district has been a significant factor underlying the housing shortage", the decision was political.
"Putting a tax on house building in the name of affordable housing is really quite unsafe."
Several councillors similarly questioned the sense of inclusionary zoning in the district, anticipating push-back from developers, and an eventual Environment Court appeal.
"It’s going to go through the courts and we won’t get any money out of this, if we ever do, for five, six years ... ," Cr Niki Gladding said.
"What we’re facing is an intergenerational housing affordability crisis — this will affect, socially, our community for at least an entire generation," Cr Quentin Smith said.
"I’m not unaware of the challenges this plan will face ... but we need to try and I support us doing everything we can to make that work."
Crs Niamh Shaw and Calum MacLeod said the plan change was "ground-breaking".
"This is brilliant — it’s essential work that has been done for this district ... by people that live here and feel that pain," Cr MacLeod said.
"If we do have to take it to the High Court, so bloody what — I’m happy to go into a ring with anyone to defend this."
A late submission from iwi authorities requested Maori freehold land, and Crown land reserved for Maori, be excluded from the policy, which triggered an hour-long debate between councillors, and a subsequent amendment.
However, the amendment was eventually revoked when it came to light the proposed policy would not apply to the Maori land in question — Kidds Bush and Sticky Forest — as the sites are zoned rural.
At the conclusion of the discussion, which Mayor Jim Boult called "the most truncated and difficult item we’ve faced at this council", councillors voted 10-1 to publicly notify the plan change.
To date, QLCHT has built eight housing developments, with construction under way on a further ten homes in Wanaka, and sections in Hawea and Arrowtown slated for development later this year.
