Transfer of Development Rights (TDR) Case Studies

Issues Addressed:
Housing Costs Housing Options Infrastructure Sustainable Housing
The Cottages at Back River Road project features small detached single-family around a central green area. It was enabled by TDR in Dover. (Image via Foster’s Daily Democrat.)

Dover, NH TDR

The City of Dover recently enabled a workforce housing project called the Cottages at Back River Road through its Transfer of Development Rights program. The development consists of 44-detached “cottage style” units that are 385 square feet each located on a 7.16 acre site. These residences, which will all be rental units, will be capped at HUD’s Fair Market Rates and are meant to support the local workforce by giving employees affordable homes near their work.

Stowe, VT

This Vermont resort town implemented zoning changes to protect farm and meadowlands from large-scale commercial development, drastically reducing potential development in some areas of town. The town implemented TDR to both soften the financial blow to those landowners and to improve development quality in identified growth nodes.

Montgomery County, MD

This Maryland county is often regarded as the best example of TDR in the US. The county’s landscape ranges from dense inner DC suburbs like Bethesda and Silver Spring to contemporary suburban and exurban development to farmland and forests. These varied conditions enabled the county to launch its TDR program in the 1980s. Along with a building boom and Maryland’s mostly county-level governance, the program took off. More than 50,000 acres of farmland were preserved. However, only 4% of subdivisions used during its most active decades, and exurban development continues to alter the rural part of the county. This TDR program has been criticized for not aligning the economics of TDR credits with the zoning capacity in the receiving zone.
A map of Montgomery County, Maryland. Most of the county is shown in yellow. The cities of Takoma Park, Rockville, and Gaithersburg are labeled in the large yellow area containing all of the southern, eastern, and central parts of the county. The town of Poolsville in the western part of the county is labeled and shown in a small yellow area. The western and northern edges of the county are shown in green with the label "Agricultural Reserve."
A map of Montgomery County, MD showing the Agricultural Preserve (sending area) and growth nodes (around which are the receiving areas).(Image via Wikimedia.)

King County, WA

King County, Washington, where Seattle is located, has a TDR program that has protected 225 square miles of rural and open space lands. The program redirects development pressure from outer suburbs, exurbs, and farmlands to urbanized areas of the county. King’s County runs a TDR bank to facilitate transactions, and it operates an exchange where private actors can participate in the TDR market. The county also facilitates interlocal agreements between participating municipalities and manages transfer of obligations between communities.