The matter relating to the proposed subdivision of land at 17 Smith Street was set to appear before the Victorian Civil and Administrative Tribunal (VCAT) in March this year, with ongoing concerns from a group of residents about the project.

The objecting residents had lodged an application to VCAT in May 2020, seeking a review of Hepburn Shire Council's decision to grant a permit.

However, the proponent for the 39-lot residential subdivision, Hygge Property, applied to the Victorian Government's Building Victoria's Recovery Taskforce (BVRT) in an effort to facilitate the proposal.

According to the state government, BVRT has recommended that the Minister consider intervening to fast track the project as it considered "shovel ready, is consistent with relevant state and local planning policy, provides economic stimulus in Daylesford and supports initiatives of the Homes for Victorians strategy by facilitating the provision of affordable housing for people over the age of 50".

More recently the Planning Minister, Richard Wynne, "called in" the project from VCAT.

A state government spokesperson said Mr Wynne had referred the proposal to the Priority Projects Standing Advisory Committee for an independent review and for advice and recommendations about the proposal.

The committee will consider referred submissions about the project, comments from any referral authority, the views of the project's proponent and Hepburn Shire Council, as well as the Hepburn Planning Scheme.

"Following a public hearing process, the advisory committee will provide advice to the Minister, who will make a decision in due course," the spokesperson said.

It has been a long process since plans for the proposed subdivision of the 4.88 hectare former hobby farm were first lodged in late 2019.

While the original proposal was recommended for approval by council officers in February 2020, plans for the 53-lot subdivision were knocked back after more than 100 objections from community members and the majority of councillors voting against it in what was a rowdy council meeting.

Community concerns about the project ranged from the development changing the character of the township to the removal of trees, traffic congestion and safety concerns with the only entry and exit point being on Smith Street - right next door to St Michael's Primary School and up the road from the only secondary school in the region, Daylesford College.

The following month it came to light that a "procedural error" at the council meeting meant that the application status for the development was left in limbo.

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Rather than proceeding straight to VCAT, the applicant, Joseph van Dyk of Hygge Property, resubmitted the plans with a number of changes following consultation with the community.

The biggest change was that the subdivision was reduced to 38 sustainably built houses, one heritage lot - the original dwelling on the property - and three 'super lots' which would down the track be developed with an 'eco-village' concept, each with a 7.5 star energy rating, to provide more open space. Plans for these lots would be subject to a separate planning application.

The amended plans also included retaining the majority of trees.

Mr van Dyk also acquired a neighbouring property, meaning a second access road could connect the development to Raglan Street.

The project is also proposed to provide sustainable housing for an Older Women in Co-Housing (WINC) project, proposed to be conducted through a registered housing agency, called the Women's Property Initiative.

Hepburn Shire Council approved the amended plans in March 2020, though some residents do not feel the amendments properly addressed their concerns - hence lodging an application with VCAT.

Resident Jennie Wilmoth told The Courier that she still had a number of concerns - from density to the development being detrimental to the town's character, the value of the landscape and that it could set a precedent for other similar permit applications adjoining the development to proceed.

Mr van Dyk said he was keenly anticipating an outcome about the project.

"We firmly believe that the council's decision in March was the right decision and hopefully the Planning Minister comes to the same decision.

"We look forward to proceeding with the development in some form or another in the near future and contributing to the economic recovery of Daylesford and the greater Hepburn region."

The Advisory Committee will convene on February 15.