What Makes Transfer of Development Rights Work?: Success Factors From Research and Practice

Problem: Over the last four decades, at least 20 authors have identified various components thought to be necessary for effective transfer of development rights (TDR) programs. However, the factors most commonly cited in these articles have not yet been isolated and systematically compared with a substantial number of TDR programs that have accomplished meaningful preservation results to date. Purpose: This article is intended to help planners create effective TDR programs by identifying those features that contribute significantly to success. Methods: We created a list of the 20 U.S. TDR programs that have preserved the most land to date. We then identified the 10 success factors that publications about TDR have cited most frequently since 1972 and determined how many of the 20 programs actually exhibit these factors. Results and conclusions: The following 10 success factors are those referenced most often in the literature. Each is followed by the number of top 20 TDR programs that exhibit this factor in parentheses. Demand for bonus development (20), customized receiving areas (20), strict sending-area regulations (18), few alternatives to TDR (17), market incentives (15), certainty of use (14), strong public preservation support (13), simplicity (13), promotion and facilitation (12), and a TDR bank (4). These results suggest that the first two factors are essential to success, the next three are extremely important, and the remaining five factors are helpful but not necessarily critical, although some, such as TDR banks, can produce extraordinary results. Takeaway for practice: Communities can establish successful TDR programs by designating receiving areas that fit local conditions and offering development bonuses that developers actually want and need. In addition, successful TDR programs appear to require at least one of the following three characteristics: strict sending-area regulations, market incentives, and/or few ways for development to gain bonus density without using TDR. Five other factors are generally not essential to success, but can greatly improve program effectiveness. Research support: None.