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MODULE-6 Smart Growth Opportunities
Transfer Development Rights (TDR)
Transfer of Development Rights (TDR) provides the ability to re-direct growth away from sensitive water resources and into village centers or urban growth areas that can sustain it. It is a voluntary process available to landowners/developers and can be encouraged by providing incentives such as overall density bonuses.
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| These pictures illustrate what can happen to conventionally zoned areas. TDR offers an alternative that protects agricultural lands from this type of sprawling growth. |
Before establishing a TDR program, communities first need to identify the resource areas that they wish to protect and the areas that are best suited for intensified development. Resource-sensitive areas targeted for protection become "sending districts" via the transfer of some or all of the development rights to targeted growth areas or "receiving districts" that are better suited for increased development. Potential Receiving Areas include: village centers, transportation nodes, commercial or industrial districts, and areas served by infrastructure (i.e. centralized water supply, centralized sewer system, or public transportation routes).
The result is two-fold: the permanent protection of vital natural resources and open space, and higher-density development in the village centers. In effect, economic growth is encouraged, development potential is maintained, suburban sprawl is reduced, and resources are protected.
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Existing Village
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Conventional Development
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Development with TDR
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Implementing TDR
Resource protection areas can be determined by either drafting or reviewing a community's Local Comprehensive Plan. Once resource areas are identified, zoning code amendments can be adopted which authorize landowners in the sending districts to sell their development rights to landowners in the receiving districts. The amount of money required to purchase these development rights can be influenced by the zoning code provisions, but is generally negotiated between the landowners. This approach allows market forces to enter into the transaction and requires land owners to negotiate the final value of development rights.
In return for the purchase, landowners in the sending area place a deed restriction on their property, which is either determined through explicit zoning provisions, or negotiated as part of the permitting process. Deed restrictions can limit the level of potential development, the type of development, or some combination of both. Developers who buy development rights are purchasing the ability to build higher density on existing lots in a receiving area, opening the door to different types of higher density housing or higher intensities of commercial use.
While some transfers are based on a "one to one" ratio (one housing unit in the sending area grants one housing unit in the receiving area) other programs have increased the value of a development right if it is transferred. For example, a single development right in the sending area could provide multiple development rights in the receiving area. This development equation can result in substantial economic benefits for the developer and long-term tax savings for the community by minimizing the need for infrastructure development.
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