State and federal politicians have joined a long list of objectors after an apparent backflip by the NSW Planning Assessment Commission over the $3 billion Calderwood project.
The commission this week advised the 4800-lot subdivision "may be approved", a view at odds with its earlier, damning appraisal of the project as inconsistent with the Illawarra Regional Strategy.
The development is staunchly opposed by the Wollongong and Shellharbour councils.
The turnaround by the commission drew criticism from federal MP for Throsby Stephen Jones, who said the state government should explain how and when it would fund desperately needed road upgrades in the West Dapto area if the development proceeded.
"While I don't normally weigh in to matters that are a state responsibility, this one is different," Mr Jones said.
"That's because the Calderwood project has been misconceived from the start. This project is strongly opposed by residents and local government for sound reasons," he said, citing congestion on the Illawarra Highway and inadequate plans for funding infrastructure to support a new suburb.
"The NSW government is blatantly ignoring the expertise of Shellharbour council, which has a much greater understanding of local issues regarding flood mitigation and traffic control."
Calderwood had concept plan approval last April when the commission dealt it a major blow, finding the first stage of the project, including 231 residential lots and 120 medium-density dwellings, was not in the public interest.
The commission said in April the project was inconsistent with the Illawarra Regional Strategy, which prioritises land release at West Dapto, and there were concerns over potential flooding.
Developers Lend Lease immediately lodged an appeal with the Land and Environment Court.
This week, with the March 6 court hearing nearing, the commission sent letters to those who had made submissions when the project was being assessed. The letter said that based on further information, including "expert advice" available as a result of the proceedings, "the PAC is now satisfied that the stage 1 project may be approved subject to appropriate conditions, including conditions relating to flood mitigation works, development control guidelines and contributions towards local infrastructure".
Shellharbour MP Anna Watson yesterday called on Minister for the Illawarra Greg Pearce to "urgently" convene a regional summit to prepare stakeholders for the possibility stage one would proceed.
Ms Watson maintained development at Calderwood should occur only in the longer term, once development in release areas at West Dapto was seen through.
"It is simply impossible to do both areas at the same time, while also continuing with the development of Shell Cove and Flinders," she said.
The commission's backflip would result in planning uncertainty, confusion among stakeholders and investors, and councils being "swamped with unsustainable pressure", Ms Watson said.