A group of developers is planning a 5000-block subdivision across the ACT's northern boundary, north east of Bonner and Forde.
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In NSW, the development would tap into Canberra's reticulated water supply. Yass Valley Council would provide other services, such as garbage collection.
Private negotiations are still underway with territory, state and national planning agencies for the residential subdivision, which is about 15 kilometres from Civic.
Yass Valley Council says its future growth outside of the township is centred mainly on Murrumbateman, where it is investing in reticulated water and sewerage. But developers, who are negotiating with the NSW government as well as the shire, have been lured by the availability of rural land in close proximity to Canberra's water supply.
At Sutton and Gundaroo a lack of water has kept housing to a minimum, although development pressure is mounting. Housing blocks are generally 2000 square metres or more to cope with effluent disposal, whereas tapping into Canberra's water supply will allow building on smaller blocks and offer bigger returns for developers.
The consortium is separate from the Riverview Group, which is working with the ACT Land Development Agency, Yass Valley Council and NSW government on the cross border development for 6500 lots at West Belconnen and 5000 lots in NSW.
A workshop later this month will discuss a heads-of-agreement for water for the West Belconnen expansion. That development is not expected to breach the ACT/NSW border until 2032. Nevertheless, any agreement on water is likely to open the way for more cross-border sharing of services.
Plans for developing the Mulligans Flat area go back as far as 60 to 70 years ago, when a subdivision was completed on a map and approved. It never came to fruition.
Subdivision plans were revived in 2011. The sticking point comes down to which jurisdiction provides what services, ranging from water, electricity, schools, garbage collection and policing.
Developers can expect a fierce battle from conservationists anywhere near Mulligans Flat Nature Reserve, because of the rare Box Gum woodlands ecological values in the area.
Cr David Needham of Yass Valley Council, a Sutton resident, says nothing will happen until the services issue is resolved, but West Belconnen's discussions would help reach agreement.
"You would have to think it would happen eventually,"Cr Needham said.
The Mulligans Flat development would also provide options for services for other projects in the planning pipeline around Sutton, including developer Alex Brinkmeyer's project that was shelved more than a decade ago.
