New land use control techniques a summary review and bibliography / prepared by James R. Pease and John Stockham

[From the U.S. Government Printing Office, www.gpo.gov]

astal Zone
formation
Center COASTAL ZONE
INFORMATION CENTER
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SEP I

FEB 2 7 1997 NEWLAND USE CONTROL TECHNIQUES-
ASUMMARY REVIEW AND BIBLIOGRAPHY

U. S. DEPARTMENT. OF COMMERCE NOAA
COASTAL SERVICES CENTER
2234 SOUTH HOBSON AVENUE
CHARLESTON SC 29405-2413

Property of CSC LIbrary

Prepared by

James R. Pease

and

John Stockham

Land-Resource Management Program
OSU Extension Service

June 21, 1974

HD
260
P43
1974

Land Resource Management Program.

Since 1926 when the U.S. Supreme Court upheld the general principle of

zoning in Euclid v. Ambler Realty Company, plan implementation in Oregon,

as elsewhere,,has,been dominated by the two workhorses of land use control

zoning and subdivi sion control. Most jurisdictions have used the more or less

standard classification of land into residential, commercial, industrial

and other uses, supplemented by a variance and conditional use permit procedure..

Modifications and refinements have been made over the years to adapt to,

changing conditions and new forms of development, but, overall, zoning has

been a remarkably resilient and lasting land use control technique.
In recent years, however, certain economic, l6gal, poliii,cal, and

conceptual problems with the traditional zoning framework have motivat.ed.an

investigation of a number,of alternative land use control techniques. It

is.becoming increasing,ly apparent that the planner must have available a

variety of tec,hniques and be, prepared to apply the appropriate combination

to his particula,r planning situation.

Some of the, factors contributi'ng.to the interest in new land.use control

techniques have been the need for controls with.greater equity (i.e. controls

which overcome the problems of "windfalls and wipeouts"), the.need to harness

economic i.ncentives.to land use goals, the need to pnotect-resPurce lands,

and the need for controls which permi..t greater. flex.ibili,ty In design and

lifestyle.

The search.for new planning implementation,techniques which,meet..these

needs.has been nationwide in.scope. During the past,few years,ma.ny.planning

departments, private consultants, and universities have been engaged in research.

and trial applications of various techniques. The Land Resource Management

Program of the Oregon State University Extension Service is currently.in the-

process of collecting literature and studying various ordinances and techniques

in regard to their applicability to Oregon. Jn addition, we are working with

Clatsop County., Oregon in a cooperative project to work out methods for

utilizing some of the new techniques in updating that county's comprehensive

plan and ordinances.

The following list summarizes some of the techniques,we have been examining.

Addi.tional literature on each of these techniques is presently availlable from

the office of Land Resource Management Specialist, Room 202, Earth Science

Building, Oregon State University, Corvallis, Oregon 97331. Detailed informa-

tion on individual land use control,techniques will beforthcoming in OISU

Extension Service special reports.., Two, of these.special reports will,.be

available by September, 1974 on the topics Conservation Easements in Oregon

and The Performance Approach to Plan Implementation.,

Performance Zoning

One regulatory technique which is.of interest to many planners is

performance zoning or the use of performance standards -as a part.ial

alternative or supplement to Euclidean zoning. Euclidean zoning typically

relies on a list of specific uses to define what activities may be permitted

in the various zones. Generally, commercial, industrial,,,and residential

activities are clearly separated, with further breakdowns within these

categories for differing intensity and quality of development. Performance

zoning approaches the problem of separating potentially incompatible land

uses from a different angle. As the expression implies, with performance

standards the planner looks at effect rather than.use. At I.ong as industrial,

commercial, or residential activities,can meet-certain standards in regard

to operation, environmental impact,, and appearance, such us.es.are.permitted
in any part of the community.. A performance-based bylaw might retain zones

but they would be based on performance levels dictated by neighborhood

characteristics or environmental capabilities rather than on use categories.

The teeth of the.performance approach are the standards Which define impact.

or levels.of performance which are permitted-in.various zones,

Performance standards can be used separatelyto address certain problems

as a supplement to.a,zoning ordinance or,*taken together,they,can be used

to replace zoning as a performance ordinance.

There are a variety of ways in wh,ich performance can.be regulated. in

an ordina,nce. The earliest. use of performance standards in a planning context

involved the regulation of industrial emissions. Many cities use standards

for noise, odor, particulate matter emissions, and the handling of toxic

materials in order to differentiate between "light", "medium", and "heavy"

industries and to separate industrial from non-industrial uses.

Another type,of impact which is well suited to performance-based

regulation is traffic generation. Traffic is one of the greatest determinants

of neighborhood character. Regulating land use by the traffic generation

potentials of fixed activities can be as effective in controlling development

as use restrictions. A considerable amount of research has been done on the

traffic attraction ratios forlactivities which can be utilized in developing

traffic performance standards.,

Standards setting forth permissible floor-ar,ea ratios and landscape-

area ratios are methods of limiting densities within designated zones without

specifying particular uses or design features., The performance standards

in.this instance Influence the open space character.of a neighborhood..

Performance standards can also be developed:to regulate.impact!on

community services, utility demand, aesthetics, and demographic impact..

The standards can be uniform across the jurisdiction or can vary according-

to the development patterns which are desired. The standards can be used

as a.minimum base.level of.performance for all activities or they can be

used in A quality point system context for discretionary.deci,sjohs.by the

planning commission.

The "performance approach".has a number of advantages.over traditional

zoning. First, performance standards allow greater flexibili.ty in terms of

both the type of activity,permitt.ed'in a particular location.and the.design

of the activity. For example, cluster designs can be handled without

recourse to floating zones. Second, performance zoning has generally met

with broad public acceptance because it is a rational land use control

that is, the objectives of the plan and the criteria for zoning areclosely

related and are explicitly set forth in the ordinance. Third,-land use

controls need a rational basis in order to be leg ally defensible. Although

the caselaw inregard to performance zoning has not been fully developed,

courts have a consistent history of acceptance of performance standards.
Finally, performance zoning is adaptable to a wide variety of circumsta nces'.
The criteria a community chooses to evaluate on the basis of performance

can be tailored to best reflect community characteristics.

There are some problems with using performance standards. A good data

base and special expertise are needed to dr,aw,up the standards.. To be

effective, the standards need to be quantitative. Although,methods,exi,st

for measurement of performance, special equipment and expertise may be required.

Administration of the standards often requires field checks,so that increased

staff may be necessary. The question of whether preparation and administration

of performance standards is more costly than zoning preparation and adminis-

tration has not been settled, since there i,s little experience with the

performance approach.

Transfer of Development Rights

Transferable Development Rights (TDR's) Is' t'he generic name given to a
number of existing, and proposed techniques by which permitted density

(i.e., the amount of floor area that can be developed on a given lot as

determined by the applicable zoning restrictions) is transferred from

one unit of land to another. The purpose of the transfer is to preserve

the land (e.g. agricultural land) or building (e.g. historical landmark)

from which development ri ghts are transferred, without depriving the land-

owner of property rights. A market is created for the development rights

by permitting higher density somewhere else where development is desired.

The developer is then permitted to build at a higher density in the

development area than zoning allows by purchasing development rights

from the preservation area. The owner of the land in the preservation

area is compensated by the purchaser of the development rights. The public

benefits from the transfer insofar as it is able to restrict land use in

certain areas without having to absorb the cost of compensation.

The use of development rights transfers had. its.origin inthe pro-.

tection of historic landmarks in urban areas. The idea.has.been expanded

recently to provide a mechanism.for protecting agricultural lands, envir,on-

mentally sensitive areas or other valuable open,space,lands whichare

threatened by market pres.sures for more intensive development. A proposal

has been made in Fairfax County, Virginia to assign TDR's to all lands

within the jurisdiction and to concentrate or disperse development

rights according to policies and criteria established in. the comprehensive

plan. In this latter case, the,TDR technique represents an alternative

to zoning for implementing the plan.

TDR dea.1s.directly with the economic consequencesto private landowners
and to government.of stringent land use controls, a serious "blind-spot"

of most zoning programs. The economi1cs of market place supply and demand

are allowed to operate within a structure established b planners to
Y,

accomplish planning objectives.

Ideally, TDR compensates a landowner for not developing his land,, at

no cost to the public; it creates an opportunity for the developer to build

at higher density, and therefore more profitably, at a location specified

in the plan; the public gains open space and protects valuableresources

without paying for it, at least directly; and the plan is given a better

chance of being implemented by working with, rather than against, the

market place.

However, there are difficult problems to overcome before the TDR

technique will be available for general use. To avoid becoming unmanageable,

TDR needs to be balanced with reasonable police power measures, which

requires such matters as right to a jury trial and procedures for determining

damages (eminent domain vs. p olice power cri.teri,a) to be settled. Creation

of an.active market.for transfer rights is:esse.nti-al to its success, which

may require a cooperative arrangement between cities and counties. Decisions

need.to be made on the planning implications of a two-tiered density system,

and on the tax liabilities involved in TDR.

There is much groundwork to be done on TDR's legal, Planning, and

economic ramifications.. Experiments with variations.of TDR are now under.-

way in Vermont, Ca.lifornia,,.Virginia, Puerto Rico, Colorado, New Jersey,

and,Illinois., Perhaps t.he single most significant contribution of,TDR,

is its recognition of the economic consequences of land use regulation..

Conservation Easements

Easements are, of course, a well-tested means of acquiring''a lesso-than-
fee-simple interest in land. Land ownership includes a bundle of rights

that run with the land. One or several of these rights may be sold or.

donated in the form of an easement. The easement can be for part or all

of the land and may last for acertain number of years or in perpetuity.

Two types of easements are commonly recognized: positive and negative.
Positive easements acquire the right to do something with part of a personts

property; for example, a public agency may purchase a right-of-way for

fishing access or a bicycle trail. Negative easements obtain rights from

a property owner in order to prevent him from engaging in certain land

use activities, such as not cutting vegetation or not erecting billboards.

Easements have been extensively used by state agencies and utilities for

right of way acquisitions and public access.

.Conservation easements are simply a variation of the basic easement

concept. Conservation easements are designed to protect the value of the

land in terms of its natural resources, visual characteristics, cultural

or historical significance,or recreation potential. The two subcategories

of a conservation easement are scenic and use easements. A scenic

easement is a negative typeintended1to prese rve the visual qual,iti,es,

of a landscape, while a use easement js a positive type. used primarily

to provide recreational opportunities.

Conservation easements may be acquired by purchase or asagift.

Purchase.of easements to preserve open space or to restrict development

in critical environmental areas has certain advantages over outright.

purchase of the land in that the cost is less than fee simple, and the

land remains in production and on the tax- roll t.

In certain cases, a landowner may benefit financially by donating a*

conservation easement and entering it as a.charitable deduction-on both

the Federal and Oregon income. tax,returns. To qualify for a deduction,

it must be a charitable donation, as defined in the Internal Revenue

Service Code, in perpetuity. Property tax is also subject to a reduction

after an easement is.sold or donated.

The planner may be able to combine the benefits of a conservation

easement donation with the cl,uster technique to achieve open space objec-

tives while assisting the developer in increasing Ms overall profits.

The cluster design-conservation easement combination represents a tech-

nique presently available to the planner.

OSU Extension will publish as a special report a paper, on the legal

and institutional poli.cies in Oregon relating to conservation easements.

This publication.will be available by September,, 1974.

Capital Gains Tax.On Land Sales

The 1973 Vermont legislature passed a graduated capital gains tax on

land held for less than six years. The Vermont tax applies only to the

sale of land ancl is based on two variables: the length of time the
property was held and the percenta'ge'of gain. The chart set forth below
indicates how tax liability is calculated in the Vermont tax:

Years Land,Held *Gain, as aPercentage
by Transferor of Basis (Tax Cost)

0-99% 100-199% 200% or more

Less than l.year 30% 45% 60%

I year, but less than 2 25% 37.5% 50%

2years, but less than 3 20% 30% 40%

3years, but less than 4 15% 22.5%
0 30%

X
4years, but less than 5 10% 15% 20%

5years, but less than 6o -so/. 7.15% 10%
(*Gain, as percent of basis, shall be rounded to the next highest whole
percentage.)

It can be argued that a number-of benefits derive from this kind of

,land tax. The public recaptures some of the windfall profits made in land

speculation, especially where the land value has been increased by public.ally

financed services or by zoning amendments. The tax revenues can be used

to purchase open space by conservation easements or fee simple. It may

reduce land speculation and preserve low value uses such as agriculture

and forestry.

It is too early to tell whether the Vermont tax will be successful

in reducing speculation or preserving agriculture. There are some

indications that the tax is simply being passed on to land.purchasers,

with no realimpact on the market itself. However, the Oregon Local

Government Relations Division, Executive Department,will be evaluating a.

land tax, such as the Vermont tax plan, as a means of raising funds for

compensating landowners and to finance land acquisition by the public.

Pu-blic Corporations

Another type of institutional land use control is the public planning

and development corporation. This technique involves a public or semi-

public 'Corporation purchasing land and then leasi ng it or sel'lin'g it back

to the same owner or to different owners with restrictions on its use.

The clearest advantage of purchase and disposal of land by a public

corporation is that it provides an active means of securing ther'ight 'kind

of development, at the right'time, in the right place. Regulatory powers

can limit and shape development, but they do not'enable the public to

specify where, and when, and under what conditions devel opment is to occur.

Purchase and disposal.of land allows the efficient programming of public.

improvements and facilities, overcoming expensive l.eap-frogging, and

scatteration of development.. The technique has been widely used for

industrial sites and to a lesser extent, for preserving open space.- There

ar e many variations as to form and purpose of the public corporation.

The Oregon legislature will be examining this form of land use control

along with the Vermont-style capital gains tax as a means to compensate

landowners for restrictions placed upon the use of their land.

Other Controls

'In addition to the aforementioned controls, we will be collecting

information onthe impact of siting public facilities, taxation policies,

PUD and cluster zoning techniques, and certain kinds of special assessments

for controlling land Use in Oregon.

SELECTED BIBLIOGRAPHY

Performance Zoning

Articles, Books, and Proposals

*Horack, Frank R., Jr. "Performance Standards in Residential Zoning."
Planning. 1952.

*Kaminskey, Jacob. Environmental Characteristics Planning: An
Alternative Approach to Physical Planning. Regional Planning
Council, 701 St. Paul Street, Baltimore, Maryland. 21202.

O'Harrow, Dennis. "Performance Standards in Industrial Zoning".
Planning. 1951.

*Rahenkamp, Hohn and Sacks, Walter S., Jr. "Impact Zoning".
House and Home. November, 1972.

*Salzenstein, Marvin A. Industrial Performance Standards. ASPO
Planning Advisory Service, Report.No. 272, September 1971.

.*Toner, Williamand Thurow, Charles. "Environmental Performance
Standards in Land Use Planning." (Unpublished proposal).
Available from.Bill Toner,-ASPO, 1313 East Sixtieth Street,
Chicago, Illinois 60637..

Plans and Ordinances
*Duxbury, Massachusetts, De'velopment_Impact Model III. Prepared by
Rahenkamp, Sachs, Wells and Associates, Inc.., Stetson House,
1717.Spring Garden Street, Philadelphia, Pennsylvania 19130.

*Franklin County, Massachusetts. Performance.Zoning II.- 'Prepared
by Philip B. Herr and Associ-ates, 2-30 Boylston Street, Boston,
Massachusetts 02116.

*Knoxville, Tennessee, "A Model Zoning Ordinance for the City of
Knoxville, Tennessee". Prepared by omniplan Architects Harrell
and Hamilton, 1700 Republic National Bank Tower, Dallas,.Texas
75201.

*Marin County, "A Resolution of the Board of Supervisors Amplifying
the Novato Area Residential DevelopmentReview Board Evaluation
Criteria." (Unpublished working paper available from Marin County
Planning Department, San Rafael, CA.).

*Note Items with asterick available in O'SU 'Extension.Land Use Library.

@12

York New York, Housing Quality: A Program for Zoning Reform,
Urban Design Council of the City of New York.

Transferable Development Rights

*Chavooshian, Budd B., & Thomas Norman Esq.,."Transfer of Development
Rights: A New Concept in Land Use Management", Rutgers
University, 1973.

Costonis, John J., "Development Rights Transfer: An Exploratory Essay
Yale Law Journal, Vol. 83, No. 1, November 1973.

*Costonis, John J., "Development Rights Transfer: Perspectives for
a Critique", 1974, (Unpublished paper presented at the Bettman
Symposium entitled "Transferable Development Rights" sponsored
by the American Society of Planning Officials, Chicago, Illinois,
May 12 and 13, 1974).

*Costonis, John J., Space Adrift - Landmark Preservation and the
Marketplace, University of Illinois Press, Urbana, Illinois,
T974.

*Development Rights Transfer: A Legislative Proposal, January 1972.
(A compilation ofmaterials on a bill introduced in the Maryland
Senate in January, 1972.)

*Hagman, Donald G., "Windfalls for Wipeouts?", The Dennis O'Harrow
Memorial Lecture, ASPO Conference, Chicago, Illinois,. May 1,2, 1974.
*Moore, Audrey, "Transferable Development Rights: An Idea Whose Time
Has Come'.', February 16, 1974. (An unpublished article prepared
by Audrey Moore, Supervisor, Annandale District,,Fairfax.County,
Virginia,.)
*Rose, Jerome'G., "A Proposal for the Separation and Marketability of
Development Rights as a Technique to Preserve Open Space"., Real
Estate Law Journal, Vol. 2, No. 3, Winter 1974.

*Rose., Jerome G., "The Courts and the Balanced Community: Recent Trends
in New Jersey Zoning Law", Journal of the American Institute of
Planners, Vol. 39, No. 3, July 1973.

Conservation Easements

Internal.Revenue Code (Section 170(f)(3)(B)(ii), 1954)

Internal Revenue Regulations (Section 1.170A 7(b)(I)(ii.), April 1971.)

Sussna, Stephen, "Land Use Control, More Effective Approaches",,Urban
Land Institute, Research Monograph No. 17, 1970.

Sutte, Donald C. and Roger A. Cunningham, Scenic Easements Legal,
Administrative, and Valuation Problems and Procedures,-Natio nal
Cooperation Highway Research Program Report 56, Highway Research
Board, 1968.

Whyte, William H., Open Space Action, ORRRC Study Report 15, Superintendent
of Documents, U.S. Government Printing Office, Washington, D.C.

Special Capital Gains Tax on Land

*Huffman, Benjamin, "The Vermont Farm and a land reform program".
Volume I, State Planning Office, State of Vermont, June 1973.

*State of Vermont, "Memorandum; RE: Capital Gains Tax on Land",
April 1973.

Public Development Corporations'

*Parsons, Kermit C. & Harriet L. Budke, Canadian Land Banks, ASPO,
Planning Advisory Service, Report No. 282, October 1972.

*Pease, James R., The Public Planning and Development Corporation
Concept Discussion and Application to a Rural Area, Oregon.
State University Extension Service,
May 20, 197

*The Story of Mountain Lakes (an informal Xeroxed history of the
borough, available from the selectmen), Mountain Lakes, New
Jersey.

Strong, Ann L. & John C. Keene, Environmental Protection Through
Public and Private Development Controls, Office of Research'
and Monitoring, U.S. Environmental Protection Agency, May 1973.,

*Whyte, William H., The Last Landscape, Doubleday and Co., Inc.,
Garden City, New York, 1970.

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