Three blocks, north of the highway and west of Brewery Tap Road, could change from rural living to become a commercial 2 zone.

The planning amendment submission, made to the state government's Department of Land, Water, Environment, and Planning, notes it is "required to facilitate the commercial development of the land and promote the development of the gateway precinct to Ballarat".

It builds on the City of Ballarat's 2015 Woodmans Hill Gateway Precinct Plan, which aims to "improve the entry experience".

A report on traffic management notes "(t)he Department of Transport (Regional Roads Victoria) plan to undertake significant road works to realign the Western Highway within the Woodmans Hill Gateway Precinct" in the coming years.

A diagram is included of a potential highway overpass, which would drastically improve safety at the Brewery Tap Road and Old Melbourne Road intersections.

The department's Grampians acting regional director, Angela Daraxoglou, said in a statement the "Public Acquisition Overlay in this area ensures that we will have sufficient space for any future developments required to meet the changing needs of the community".

While preliminary planning and research has been conducted, no detailed designs have been developed by the Department of Transport yet.

A town planning report for the rezoning states there are some existing buildings on the blocks, which are accessible through side roads and have no direct access to the highway.

"The loss of agricultural land, due to the proposed rezoning, would be very minor and have no impact whatsoever and would be far outweighed by economic and employment benefits generated by the proposed rezoning," the report states.

"Based on rezoning for a mix of uses, for example highway service centre or retail area requiring external display areas there would (be) minimal adverse impacts on existing retail and commercial operations in the local area.

"Ballarat is not capturing potential passing trade with considerable traffic volumes bypassing Ballarat and spending at highway service centres outside the municipality.

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"The economic assessment indicates that a development scenario such as that modelled would deliver an investment outcome in the order of $35 million and ongoing employment on the site would be in the order of 275 permanent jobs."

Submissions close August 2, and dates have been set for a directions hearing on October 11 and a panel hearing on November 8.

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