The state participates in many federal aid programs and is required to enter into certain agreements with the federal government. The North West Shelf (Woodside) Agreement and the Railway and Port Agreement (The Pilbara Infrastructure Pty Ltd) are just two recent examples of agreements that have inserted local content commitments. The last state agreement to be amended by Parliament, the Northwest Gas Agreement, was 40 years old when it was amended in 2019. The main objective of this amendment was to extend the duration of the agreement so that operations could continue until 2071. However, the VA government took this opportunity to impose new obligations on the company by inserting clauses in “modern state agreements” requiring the implementation of local development plans and local participation in the project. The U.S. Office of Management and Budget Circular A-87 sets specific requirements for the allocation of government central service charges, including the development and presentation of a national cost allocation plan. Yet new state agreements are now much rarer than in the 1960s and 1970s. A number of recent government agreements have been reached to authorize the construction of major railway lines – a circumvention necessary in light of the Public Works Act 1902 (AV), which provides that a railway can only be built under the supervision of special legislation. The special legislation does not necessarily have to be done through a state agreement, but that is the approach that the VA government has taken in practice. The Cash Management Improvement Act of 1990 provides rules and procedures for the effective transfer of federal financial aid between federal and state authorities. The law requires the state to enter into a cash agreement with the U.S. Treasury.
The VA government also took the opportunity to amend existing government agreements to improve local content commitments. Since 2011, new Member States` agreements have increasingly incorporated local content provisions to ensure that local businesses can get the “maximum” benefits from these important projects. Government agreements are not a “one-off approach” to resource development in VA. Although all agreements have similar provisions, they are negotiated on a case-by-case basis and, as such, have project-specific clauses.