What are transferable development rights?
Correct Answer
D) Development capacity movable to another parcel
A transferable development right permits development capacity to move from a sending property to an eligible receiving location under an applicable program. The program controls eligibility, density and approvals; ownership of TDRs does not eliminate zoning or permit requirements.
Why This Is the Correct Answer
Option D is correct because a transferable development right is development capacity that is separated from a sending property and transferred for use at another location. Buyers may use the rights to develop at higher densities than zoning would otherwise allow, within the applicable program. The program governs eligibility and approvals.
Why the Other Options Are Wrong
Option A: Rights to build without obtaining any permits
Option A, rights to build without obtaining any permits, is wrong because TDRs move development capacity; they do not waive permit requirements. Development using TDRs still requires the applicable approvals.
Option B: Rights permitting a use the zoning prohibits
Option B, rights permitting a use the zoning prohibits, is wrong because TDRs typically allow added density under a program rather than authorizing an otherwise prohibited use. Use restrictions continue to apply.
Option C: Rights the local authority may revoke at will
Option C, rights the local authority may revoke at will, is wrong because a TDR is a development right held and transferable by the landowner, not a permission subject to arbitrary revocation. Its terms come from the governing program.
Rights that ride elsewhere
A TDR takes development capacity off one parcel and lets it ride to another eligible parcel.
How to use: Use this when a question asks what TDRs are or how they affect sending and receiving parcels.
Exam Tip
Choose the answer describing development capacity moving between parcels, and be wary of answers claiming TDRs eliminate permits or zoning.
Common Mistakes to Avoid
- -Believing TDRs eliminate permit requirements
- -Thinking TDRs authorize any prohibited use
- -Ignoring the value loss to the sending parcel
Concept Deep Dive
Analysis
This question tests the definition of transferable development rights. A TDR is a development right separated from one property and transferred, generally by sale, for use at another location under a program. Holding TDRs does not remove permit or zoning requirements.
Background Knowledge
TDR programs let communities protect sending areas, such as farmland or historic sites, by allowing owners to sell development rights to receiving areas where more density is desired. Severing the rights usually reduces the sending property's value and can increase the receiving property's development potential.
Real-World Application
A farm owner in a preservation area sells development rights to a developer building in a downtown receiving zone. The appraiser of the farm considers the reduced development potential after the sale, while the developer's site gains added permitted density.
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An improved property sold for a cash-equivalent price of $640,000. Analysis of comparable neighborhoods supports a typical land-to-total-property-value ratio of 30%. Using the allocation method, what land (site) value contribution is indicated?