The council wants to rezone industrial land near Otago Harbour's steamer basin to allow it to be used for residential purposes and for bars and cafes.
Its "plan change 7: harbourside" is in the Environment Court's mediation process as Cr Colin Weatherall, for the council, and six appellants try to settle their differences.
Mr Anderson's 28-page report was written for the Otago Chamber of Commerce which is one of the appellants fighting the change. It was sent out to members yesterday.
In the report, Mr Anderson describes how allowing residential use of land in an industrial area will drive businesses away and cost the city jobs.
"It is fanciful to contemplate that the loss of industrial employment from the area will be replaced by service jobs in bars, cafes, tourism and entertainment, recreation and travellers' accommodation.
"In many instances, such service jobs are likely to be no more than relocations away from the city centre, which will undermine the viability of the central activity area.
"There will be no jobs if residential replaces industry."
Council chief executive Jim Harland said yesterday the council had a "different view" but he was not going to "negotiate it in the media".
Mr Harland said he was disappointed to see the chamber had decided to "politicise and publicise a matter that's subject to the Environment Court hearing".
Mr Anderson suggested existing industry had much to fear from reverse-sensitivity as harbour-side resident and visitor numbers increased.
"Perhaps the most insidious effect of plan change 7 on the existing industrial land uses will be the required policing by complaints from the new residents.
"They will have nothing in common with industry and no need to accept the industrial noise, traffic and environmental quality in the area."
Air quality regulations and noise regulations were the two main issues, he said, and it would not help for the council to change its rules on air discharge to suit existing industries because other regional and national rules, where there was "no discretion", would come into play.
"The fundamental consequence of plan change 7: harbourside is to seek the removal of existing industrial employment . . . from the area where that employment is dependent on an air discharge."
"In our opinion, existing industry with or without requiring an air discharge consent from the [Otago Regional Council] will find it difficult, expensive and probably untenable to remain in the area affected by plan change 7."
In a separate opinion to the chamber, doctor of transport Prof Herbert Harris said while plan change 7 did not protect residential land users against low frequency sound, night-time noise, vibration and traffic and parking congestion, owners or occupiers of residential property "would be able to bring a common law action for nuisance against industry occupiers".
"At common law, occupation of land includes the right to quiet use and enjoyment."
Prof Harris said the question of nuisance did not depend on whether there was "some public benefit in the defendant's activity".
He considered existing industry would be "seriously disadvantaged and as a consequence, jobs will be lost".
Mr Anderson said there was no local example where incompatible land uses had been able to cohabit in the same area.
"There is 40 years of actual experience that physical separation is the appropriate planning response."
He also did not consider the Environment Court process was "appropriate" because it could not consider matters outside the plan change.
"It cannot now be extended to ensure that there is suitable alternative industrial land available for displaced existing industries."
