A m e r i c a n f a r m l a n d t r u s t · F a r m l a n d i n f o r m a t i o n c e n t e r DESCRIPTION TDR programs are distinct from purchase of agricultural conservation easement (PACE) pro- Transfer of development rights programs allow grams because they involve the private market. landowners to transfer the right to develop one Most TDR transactions are between private parcel of land to a different parcel of land. FARMLAND INFORMATION CENTER landowners and developers. Local governments Generally, TDR programs are established by generally do not have to raise taxes or borrow local zoning ordinances. In the context of farm- funds to implement TDR. A few jurisdictions land protection, TDR is used to shift develop- have experimented with public purchase and ment from agricultural areas to designated "banking" of development rights. A TDR bank growth zones closer to municipal services. The buys development rights with public funds and parcel of land where the rights originate is called sells the rights to private landowners. the "sending" parcel. When the rights are trans- FACT ferred from a sending parcel, the land is restrict- HISTORY ed with a permanent conservation easement. The parcel of land to which the rights are transferred TDR is used predominantly by counties, towns SHEET is called the "receiving" parcel. Buying these and townships. The 1981 National Agricultural rights generally allows the owner to build at a Lands Study reported that 12 jurisdictions had higher density than ordinarily permitted by the enacted TDR programs to protect farmland and base zoning. TDR is known as transfer of devel- open space, but very few of these programs had TRANSFER OF opment credits (TDC) in California and in some been implemented. In the 1980s and 1990s, regions of New Jersey. many local governments adopted TDR ordi- nances. A survey in the spring of 2000 identified TDR programs are based on the concept that DEVELOPMENT 50 jurisdictions with TDR ordinances on the property owners have a bundle of different books. Three programs had been revoked. rights, including the right to use land, lease, Despite the widespread adoption of TDR, only sell and bequeath it, borrow money using it as RIGHTS fifteen programs have protected more than 100 security, construct buildings on it and mine it, acres of farmland and only eight programs have subject to reasonable local land use regulations. protected more than 1,000 acres of farmland. Some or all of these rights can be transferred or Twenty-two programs, or 44 percent, have not sold to another person. When a landowner sells protected any agricultural land. Since 1980, property, generally all the rights are transferred Montgomery County, Maryland, has protected to the buyer. TDR programs enable landowners 40,583 acres using TDR, or 60 percent of the to separate and sell the right to develop land national total (67,707 acres). from their other property rights. TDR is most suitable in places where large FUNCTIONS & PURPOSES blocks of land remain in farm use. In communi- TDR programs can be designed to accomplish ties with a fragmented agricultural land base, multiple goals including farmland protection, it is difficult to find a viable sending area. TECHNICAL ASSISTANCE conservation of environmentally sensitive areas Jurisdictions also must be able to identify One Short Street, Suite 2 and preservation of historic landmarks. In the Northampton, MA 01060 receiving areas that can accommodate the context of farmland protection, TDR programs Tel: (800) 370-4879 development to be transferred out of the farming prevent non-agricultural development of farm- Fax: (413) 586-9332 area. The receiving areas must have the physical land, reduce the market value of protected farms Web: www.farmlandinfo.org capacity to absorb new units, and residents and provide farmland owners with liquid capital of those areas must be willing to accept higher NATIONAL OFFICE that can be used to enhance farm viability. density development. Often, residents of poten- 1200 18th Street, NW, Suite 800 Washington, DC 20036 tial receiving areas must be persuaded that the TDR programs also offer a potential solution Tel: (202) 331-7300 benefits of protecting farmland outweigh the to the political and legal problems that many Fax: (202) 659-8339 costs of living in a more compact neighborhood. communities face when they try to restrict devel- Web: www.farmland.org January 2001 The Farmland Information Center is a public/private partnership between American Farmland Trust and the USDA Natural Resources Conservation Service that provides technical information about farmland protection. A m e r i c a n f a r m l a n d t r u s t · F a r m l a n d i n f o r m a t i o n c e n t e r opment of farmland. Landowners often oppose planning process. Comprehensive planning helps agricultural protection zoning (APZ) and other a community envision its future and generally land use regulations because they can reduce involves extensive public participation. The equity. APZ can benefit farmers by preventing process of developing a community vision may urbanization, but it may also reduce the fair mar- help build understanding of TDR and support for ket value of their land. When downzoning is farmland protection. combined with a TDR program, however, TRANSFER OF landowners can retain their equity by selling BENEFITS OF TDR development rights. · TDR protects farmland permanently, while DEVELOPMENT keeping it in private ownership. ISSUES TO ADDRESS · Participation in TDR programs is voluntary- In developing a TDR program, planners must landowners are never required to sell their RIGHTS address a variety of technical issues. These issues development rights. include: · TDR promotes orderly growth by concentrating · Which agricultural areas should be protected? development in areas with adequate public services. For additional information on · What type of transfers should be permitted? transfer of development rights · TDR programs allow landowners in and other farmland protection · How should development rights be allocated? agricultural protection zones to retain their equity without developing their land. programs, the Farmland · Where should development be transferred, and Information Center offers pub- at what densities? · TDR programs are market-driven-private lications, an online library and parties pay to protect farmland, and more land · Should the zoning in the sending area be is protected when development pressure is high. technical assistance. changed to create more of an incentive for The farmland information landowners to sell development rights? · TDR programs can accomplish multiple goals, library is a searchable database including farmland protection, protection of · Should the zoning in the receiving area be of literature, abstracts, statutes, environmentally sensitive areas, the develop- changed to create more of an incentive for ment of compact urban areas, the promotion maps, legislative updates and developers to buy development rights? of downtown commercial growth and the other useful resources. preservation of historic landmarks. It can be reached at · Should the local government buy and sell development rights through a TDR bank? http://www.farmlandinfo.org. DRAWBACKS OF TDR For additional assistance on One of the most difficult aspects of implementing specific topics, call the TDR is developing the right mix of incentives. · TDR programs are technically complicated and require a significant investment of time and technical assistance service Farmers must have incentives to sell development staff resources to implement. at (800) 370-4879. rights instead of building lots. Developers must benefit from buying development rights instead · TDR is an unfamiliar concept. A lengthy and extensive public education campaign is of building houses according to the existing generally required to explain TDR to citizens. standards. Thus, local governments must predict the likely supply of and demand for development · The pace of transactions depends on the private rights in the real estate market, which determines market for development rights. If the real estate market is depressed, few rights will be sold, and the price. TDR programs are sometimes created little land will be protected. in conjunction with APZ: New construction is restricted in the agricultural zone, and farmers are compensated with the opportunity to sell development rights. Because the issues are so complex, TDR pro- Source: American Farmland Trust, Saving American grams are usually the result of a comprehensive Farmland: What Works (Northampton, MA 1997) American Farmland Trust works to stop the loss of productive farmland and to promote farming practices that lead to a healthy environment. A m e r i c a n f a r m l a n d t r u s t · F a r m l a n d i n f o r m a t i o n c e n t e r LOCAL GOVERNMENTS WITH TDR PROGRAMS FOR FARMLAND, 2000 Date Acres of Total Ordinance Farmland Acres State/County Enacted Protected Protected Notes California Marin County 1981 670 670 Multi-purpose program *San Mateo County 1986 40 40 Bonus rights awarded for development of agricultural water storage San Luis Obispo County 1996 0 0 Multi-purpose program, appraisals used to allocate development rights Colorado Boulder County 1995 ~2,800 ~3,200 Multi-purpose program, mandatory program, bonus development rights awarded for available agricultural water rights Connecticut Windsor 1993 0 0 Multi-purpose program Florida Hillsborough County 1985 0 0 Multi-purpose program Palm Beach County 1992 0 6,573 Multi-purpose program, original program created in 1980, substantially revised in 1992 Idaho Fremont County 1991 0 200 Multi-purpose program Maine Cape Elizabeth 1982 0 0 Multi-purpose program Maryland Calvert County 1978 8,000 8,000 Caroline County 1989 NA NA Charles County 1992 1,183 1,183 Harford County 1992 NA NA Sending and receiving areas must be within 500 feet of each other Howard County 1992 1,438 NA Multi-purpose program, county purchases and retires development rights Montgomery County 1980 40,583 40,583 Mandatory program Queen Anne's County 1987 2,000 2,417 Multi-purpose program, rights can be used to increase residential density or to increase square footage or impervious surface area in non-residential applications *St. Mary's County 1990 0 6 Multi-purpose program Talbot County 1989 500 580 Multi-purpose program Massachusetts Groton 1980 50 292 Multi-purpose program Hadley 2000 0 0 Rights can be used to increase commercial and industrial square footage and reduce parking requirements. An alternate mechanism allows developers to make cash payments into a farmland protection fund in lieu of buying development rights to receive the density bonuses Sunderland 1974 NR NR Townsend 1989 0 0 Multi-purpose program Minnesota Blue Earth County 1977 ~3,000 ~3,000 Montana Springhill Community, Gallatin County 1992 200 200 Mandatory program New Jersey Chesterfield Township, Burlington County 1998 0 0 Multi-purpose program Hillsborough Township, Somerset County 1975 0 0 Multi-purpose program Lumberton Township, Burlington County 1996 563 563 Multi-purpose program New Jersey Pinelands 1981 5,722 19,238 Multi-purpose program, mandatory program A m e r i c a n f a r m l a n d t r u s t · F a r m l a n d i n f o r m a t i o n c e n t e r Date Acres of Total Ordinance Farmland Acres State/County Enacted Protected Protected Notes New York Eden 1977 31 38 Multi-purpose program *Perinton 1993 56 82 Multi-purpose program Central Pine Barrens (Long Island) 1995 NA 307 Multi-purpose program, mandatory program, rights can be used to increase residential density, commercial square footage or permitted sewage flow *Southampton 1972 0 232 Multi-purpose program Pennsylvania Birmingham Township, Chester County 1978 0 0 Multi-purpose program *Buckingham Township, Bucks County 1975 280 280 Chanceford Township, York County 1979 0 0 Codorus Township, York County 1990 40 40 PROGRAM REVOKED East Hopewell Township, York County 1984 NA NA *East Nantmeal Township, Chester County 1994 0 0 Hopewell Township, York County 1988 NR NR London Grove Township, Chester County 1995 0 0 Point system used in allocation of development rights *Lower Chanceford Township, York County 1990 200 200 Transfers between adjacent parcels in common ownership only Manheim Township, Lancaster County 1991 190 190 PROGRAM REVOKED Shrewsbury Township, York County 1991 NA ~100 TDR bank under discussion Springfield Township, York County 1996 0 0 Multi-purpose program *Warrington Township, Bucks County 1985 0 0 Rights can be used to increase commercial/industrial building coverage and impervious surface area Washington Township, Berks County 1994 0 0 Utah *Tooele 1995 0 0 Vermont Jericho 1992 0 0 Multi-purpose program, mandatory program point system used for the allocation of development rights South Burlington 1992 50 250 Multi-purpose program, mandatory program Williston 1990 NA NA Multi-purpose program Virginia Blacksburg 1996 23 23 Multi-purpose program Washington Island County 1984 88 88 PROGRAM REVOKED Thurston County 1995 0 0 Mandatory program TOTALS 67,707 88,575 * Information from 1997 survey "NA" means that the program's contact person reported that the data either was not available or was not tracked. "NR" means that the program's contact person did not reply to the 1997 or the 2000 survey. The terms "voluntary" and "mandatory" can be confusing when used in reference to TDR. For the purposes of this fact sheet we categorize TDR programs as "mandatory" if land use regulations (e.g., APZ) are adopted at the time the program is created to reduce the amount of development that can occur in the sending area. Under "mandatory" programs landowners who want to realize their full equity based on the old regulations must sell their development rights. For example, Thurston County, Wash., imposed APZ on more than 12,000 acres decreasing maximum residential density from one unit per five acres to one unit per 20 acres. Landowners in the agricultural zones can develop their land under the new zoning rules, or if they choose to participate in the TDR program, can sell one development right per five acres. TDR programs in Montgomery County, Md., and the Pine Barrens of New Jersey, use the same approach. Boulder County, Colorado, made the criteria for non-urban planned unit develop- ments (NUPUDs) stricter at the time the TDR program was enacted. Previously, any landowner with 35 acres qualified for a NUPUD. Now, landowners are required to own 320 acres to qualify. NUPUDs allow development at the same rates as the TDR program. Surveys were sent to programs identified by staff and profiled in farmland protection and planning publications, including Saved By Development by Rick Pruetz, AICP. The table is meant to be comprehensive. If you are aware of other TDR programs that protect farmland, please contact AFT's technical assistance service.