Development and TDR
by Robert Hedges -


In Kentucky, a bill was passed in the 1998 session that set up a mechanism for urban-county governments .

In addition to the PACE program, Fayette County KY passes a bill in 1998 to establish a Purchase of Development Rights program (KRS 67A.840-850).

There are several types of programs in use around the country today and several purposes to be achieved.

Several of the programs in use are based on the principle of TDRs. A unit of government designates a "sending area" where development is restricted, and a "receiving area" where development is made easier. Property owners in the sending area can sell the rights to develop their land to property owners in the receiving area; usually this allows the receiving owners to build at greater densities than they normally could.

If it works right, says Pruetz, this exchange creates a win-win-win situation. The government can downzone or otherwise restrict development in valued areas (sending areas) without spending scarce tax dollars to purchase the land outright or compensate irate property owners. The sending-area property owners do not lose the value of potential development, because they can sell those rights to those in the receiving area. Receiving-area property owners can buy those rights and gain the chance to build more densely (hence more profitably), at less cost than acquiring more land. The following book is said to be the last word on TDRs.

Pruetz, Rick; Saved by Development: Preserving Environmental Areas, Farmland and Historic Landmarks with Transfer of Development Rights Rick Pruetz. Arje Press, Burbank, CA, 1997.437 pp. $39.95. This is a study of 107 Transfer of Development Rights (TDR) programs across the country beginning with surveys from 3,500 counties, cities, townships, and villages.

Three major TDR programs:


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Last modified: Jul 2000