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September 16, 2008

TDR discussions continue; Slutzky’s straw proposal abandoned

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There will be no down-zoning of Albemarle County’s rural areas in the near future, according to a comment made last week by Supervisor David Slutzky (Rio). That’s just one of the ways in which his straw proposal to create a market for rural development rights has been modified as a group of community stakeholders have weighed its merits. However, many questions remain unanswered as the collection of disparate interests continues to debate the future of development and rural area protection in Albemarle County. 

The concept was explored even further during the fourth meeting of the group on September 11, 2008. Facilitator Terry Rephann of the Weldon-Cooper Center at the University of Virginia began by explaining that Slutzky’s Transfer of Development Rights (TDR) straw proposal was meant as a starting point for discussion.

“But we’ve moved to a different point now, and we’re talking about an entirely different proposal that has different elements,” Rephann said. He urged the stakeholders to remember that the key tenets of the Slutzky proposal were off the table. There will not be a down-zoning which means participation in the TDR market would not be mandatory. There will be no expansion of the County’s growth area to create a new receiving area.

Slutzky said he wanted to move forward in a way to determine what can be done to encourage rural preservation. He said there are two different classes of land parcels to address. First, those tracts over 50 acres that likely have several development rights which can be protected with a conservation easement. Second, there are approximately 7,800 lots in the County that are less than 50 acres and are “effectively unused.” Slutzky said a down-zoning would not have affected the development potential of the second category of lots, and that they are not likely attractive candidates for conservation easements. Slutzky acknowledged barriers to protecting the first category as well.

“For the larger parcels where they are eligible for conservation easements, the dollar value of putting the land in conservation easements seems like its way more than what the land owner would likely receive if they sold TDRs, based on what TDRs have sold for in other markets,” Slutzky said. He said the TDR discussion group should now take a look at finding ways to encourage landowners to put their land into easements. “Maybe the County should be putting more effort into explaining to the public how that actually works and making it clear to the public all of the elements of economic benefit that are associated with the conversation easement programs.”  The week before, the Albemarle County Board of Supervisors heard a report on alternative funding strategies for conservation easements .

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Slutzky added that if the group still sees merit in a TDR program, perhaps it could be extended only to the smaller 7,800 parcels on a voluntary basis. He asked several questions to stir up discussion.
“How do you set up a program that would motivate the owners of those development rights to extinguish them and sell them into a receiving area? And if the receiving area is not going to be an expanded growth area… do we want to have this receiving area the whole growth area, or do we want to pick areas?”

Supervisor Dennis Rooker (Jack Jouett) said he thought that many people in the farming community are not aware of those potential economic benefits. Rooker, who is an attorney, said he has negotiated deals where a landowner sells a conservation easement to someone who can benefit from the tax benefits that come with such an easement. “It is a very viable option for people who want to keep their land and want to try to realize some of the value out of some of the development rights on the property,” Rooker said.

He added the County had a desire to move land from land use taxation to conservation easements in order to reduce the payment it must make to the City of Charlottesville under the revenue sharing agreement. Property in land use is still assessed at full value under the formula that governs the agreement. 

Sarah Henley, representing Forever Albemarle, said conservation easements are not as straight-forward as that, but after spending a few minutes discussing the finances involved, she said she would like to have more information. “It’s definitely interesting,” she said. Tony Vanderwarker of the Piedmont Environmental Council agreed to set up a meeting between local farmers and PEC land officer Rex Linville.

ALTERNATIVE PROPOSAL EXPLAINED

Anticipating the changes to the straw proposal, Leigh Middleditch asked his representative, Alden English, to prepare an alternative that would combine a TDR program with conservation easements.  Under his plan, development rights could be sold to a market with a conservation easement recorded on the sending property. 

“If the County only required that you have a ‘no-division’ prohibition in that conservation easement, but then you decided to do more than that, there might be some charitable donation value in what you do beyond what the County requires, and you might be able to have a federal deduction for the value of that gift,” English said. “It would be especially beneficial for landowners of the smaller parcels that the [County’s Acquisition of Conservation Easements (ACE)] program isn’t as interested in.”

English added that this would lower a landowner’s property value so it would qualify for a reduced tax rate, similar to the land use value. Unlike land use, however, the reduced value would be permanent.  English also said that his proposal does not yet consider the specifics of the receiving area for transferred development rights.

Having heard English’s proposal, the group next discussed several possibilities. One of the questions: If the County’s growth area is already designed for future development, how could it be used as a receiving area?

Rooker estimated there are about 1,000 acres of land available for rezoning and development in the growth area, and he suggested that those areas might acquire development rights rather than be rezoned.  He also suggested that other areas which might soon redevelop could somehow be designed as a receiving area.

Supervisor Slutzky asked that if the growth area was being considered for the receiving area, would that mean that developers who purchased development rights would not have to pay cash proffers? If so, how would the County pay for the impacts associated with the increased growth?

Attorney Tara Boyd of LeClair Ryan, representing attorney Steven Blaine, asked if a development right moved into the growth area from the rural area would mean less services in the County. Slutzky said that while the County would not have as many people in the rural area to serve with fire or police, there is still a cost associated with making sure there is enough sewer and water capacity.

Neil Williamson of the Free Enterprise Forum said he was concerned that the cost of a County goal to preserve rural preservation would be ultimately borne by those who purchase new homes. He opposed a scenario where developers had to purchase both a development right and also pay a cash proffer.

Tony Vanderwarker suggested that the receiving area be clustered around the University of Virginia, the region’s largest employer. “Instead of having people park at the Blue Lot, why don’t you have people living at the Blue Lot?” He suggested using the TDR mechanism to encourage developers to build affordable housing close to employment.

Chuck Rotgin of the Great Eastern Management Company said that the only way to maximize the value of the TDR would be to ensure that developers could do whatever they want in the receiving area. He said he was concerned that if the growth area wasn’t expanded, there would not be enough land to satisfy, in his words, “what the market wants.”

“Under the existing ordinance, there can be no more Glenmores, there can be no more Forest Lakes, there can be no more Carrsbrooks,” Rotgin said. “That’s what the market wants. To the extent that it can’t get it, either in a growth area or a boundary area, it’s going to one of two places. The rural area, or a neighboring county. Neither one of them are good options for Albemarle County.”

Rotgin opposes the requirements of the County’s Neighborhood Model form of development that requires developers to include, for example, amenities like street curb and gutters, street trees, and sidewalks.
Morgan Butler of the Southern Environmental Law Center pointed out that if he wanted, Rotgin could bypass all of those requirements and develop his properties to their by-right densities.

“If the market is really demanding these size houses, then you would see people coming in and doing it by-right,” Butler said. Rotgin’s company is currently preparing to develop North Pointe north of Hollymead Town Center and east of the airport.

Williamson asked the elected officials if the County would waive cash proffers if a developer purchased development rights? Rooker said he would need to analyze the question. Slutzky said he would need to know if the county could assess an impact fee to help pay for infrastructure.

Jon Cannon, serving as a facilitator for the group, said that he wanted more information from the group on two things. How would additional infrastructure be funded under the plan? How would the TDRs be generated? Would the receiving area designated in the growth area be rezoned in such a way to require a TDR in order to build anything as long as enough development rights are purchased?   How large would the receiving area be, and would there be a finite amount of development rights that could come from the sending area? Could the sending areas be limited to those that the County deems are the most ecologically important to protect?

At the end of the meeting, Rephann asked each stakeholder to comment on the day’s meeting. Joe Jones of the Farm Bureau said he would prefer not to see the sending areas restricted to only portions of the County.  Morgan Butler supported that idea.  Jack Marshall of Advocates for a Sustainable Albemarle Population said he supported the idea of having the County’s Natural Heritage Committee recommend a list of important parcels to protect. He also said he would like to be able to transfer development rights into the City of Charlottesville as well as adjoining counties. Jane Fisher of the Charlottesville Community Design Center wanted more information about how certain parts of the County are not being developed to their maximum potential density. Sarah Henley also opposed the idea of restricting the sending areas, but did support the idea of sending them to neighboring communities.
The next meeting of the group will be held on October 11, 2008.

Sean Tubbs

 

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