Transfer of Development Rights in Plain English
What is Transfer of Development Rights (TDR)?
"Transfer of development rights "is a mechanism for removing the development rights from one property and transferring them for use on another property. The owner who sells (or otherwise transfers) development rights from his/her property retains property ownership and certain rights to use the property, but not the right to develop the property. The purchaser of these rights typically uses them to develop another property at higher density.
Property ownership consists of a bundle of different rights in addition to development rights. Generally, these rights include the right to use, develop, sell, or lease the land, and ownership of mineral, timber, water, air, and other rights. Usually, when someone purchases a parcel, they purchase the entire bundle of rights associated with the land. If development or other rights have been removed, the property value is reduced to reflect the value of the remaining property rights.
Local jurisdictions may establish a TDR program when they want to both limit development in some areas, such as farmlands, and encourage development in other areas, such as urban centers. Local jurisdictions designate "sending areas," (where development may be limited and the development rights sold) and "receiving areas" (where the TDRs may be used to develop a property more intensively than would otherwise be allowed). A conservation easement or deed restriction is typically used to permanently restrict development on the sending parcel. TDR programs provide an economic incentive for leaving land undeveloped, since the property owners may sell the unused development rights and be compensated for the restriction.
Transfer of Development Rights Concept as Applied in Washington
The Growth Management Act (GMA) encourages innovative land use management techniques including TDR. Some Washington communities are finding that TDR is a useful, incentive-based tool for accomplishing many GMA goals, including guiding growth away from natural resource lands (such as farms and forest lands) historic properties, and sensitive lands, and toward compact urban centers with jobs, shopping, adequate public facilities and services, and multimodal transportation systems. In addition to these local programs, the state legislature has authorized a voluntary Regional Transfer of Development Rights Program for the Central Puget Sound region. This program allows transfer of development rights across jurisdictional boundaries (Ch. 43.362 RCW).
Resources
- Transfer of Development Rights, MRSC
- Transfer of Development Rights (Farmland Preservation), MRSC
- A Resource Guide to Designing Transfer of Development Rights Programs in Washington State (
), Cascade Land Conservancy, 06/2009 - Regional Transfer of Development Rights Program, Washington State Department of Commerce