Transferable of Development Rights (TDR) Changes in the Works
Next Monday, the Board of Supervisors Land Use and Economic Development Committee will hold a hearing on a proposed ordinance that would make some substantial changes to the way TDR sales are treated.
TDRs were created when the Downtown Plan was enacted in 1985. A survey done in conjunction with the plan rated buildings in the downtown area from I to V, based on their historic importance. Buildings rated “significant” or “contributory” had significant development restrictions placed on them. In exchange, owners of these properties were granted TDRs, measured in the number of square feet of developable space that the Planning Code permitted minus the amount of actual improvements on that lot. TDR could be sold to other downtown property owners to increase the amount of space that can be developed on the buyer’s development site. In the 25 years since the TDR program was created, hundreds of thousands of square feet of development rights have been traded downtown, and there are few large blocks left. During the last big development cycle, there was a concern that the shrinking supply of TDR would begin to limit downtown development.
The proposed changes, an outgrowth of an attempt to help finance the continuing seismic retrofitting of Old Saint Mary’s Church, would do the following:
1. Currently, the transfer of TDR between lots is limited depending on the type of C-3 zoning district the transferring lot and receiving lot are located in. The proposed ordinance would allow the transfer of TDR between any two lots located in any C-3 districts if the transferring lot is also a designated an individual landmark (i.e. the landmark must be downtown) and the receiving lot is not within a Redevelopment Agency project area. There remain 24 landmarks in C-3 districts that have yet to sell TDR, so this would broaden the group of buyers for these TDR. The Planning Department has indicated it is limiting this loosening of TDR sale rules to individual landmarks in order to study the effects of such a change. If successful, further loosening of the rules for significant or contributory buildings could be proposed.
2. The proposed ordinance would require that the net proceeds of any TDR sale after July 1, 2010 “first be used to pay for or finance the preservation, rehabilitation, and ongoing maintenance of the building” on the transferring lot, as well as to correct any outstanding notices of violation issued by the Department of Building Inspection. There are only limited examples of what this work could entail provided in the ordinance, such as seismic retrofitting and improving access for the disabled. Guidance on exactly what type of maintenance and repair would be required in these situations would be prepared by the Planning Department in the event the proposed ordinance passes. The intent of this provision is to require owners of transferring lots to bring the existing building into working condition.
This legislation gives a little, and takes a lot. On the one hand, some downtown landmark buildings are getting some benefit here, as it should be easier for them to sell their TDR. But on the other hand, every TDR transfer going forward (whether a landmark building or not) will be required to spend some of the money generated by the sale on the historic building. That second bit is a major policy change, is not necessary, and will be an incredible headache for both the property owners and the Planning Department to administer.
The Planning Commission and Historic Preservation Commission have both approved the proposed ordinance, which now requires Board of Supervisors’ approval as it is an amendment of the Planning Code. We’ll keep you posted on the status of the legislation. To see a copy for yourself, visit:
And Then There Were Five…
You may have missed it while on your August vacation, but two Planning Commissioners’ terms have expired and there are now only five sitting members of the Commission.
Commissioners Bill Lee and Gwyneth Borden terms expired on July 1, but the City Charter allows a member to continue to occupy their seat for 60 days if no replacement or reappointment has been made. That 60 days ran at the end of August. As of today, the Mayor has reappointed Commissioner Borden. Since the reappointment must go through the Board of Supervisors Rules Committee and then be approved by the full Board, the earliest Planning Commission hearing she could sit at would be on October 7. No reappointment or new appointment has been made for Commissioner Lee’s seat, meaning it may sit vacant for some time.
This diminished Planning Commission can have serious effects. Fewer Commissioners mean less diversity of voices that consider and discuss the projects that come before the Commission. And of course, a project typically must receive at least 4 votes to be approved, regardless of the number of sitting Commissioners. With only 5 members on the Commission, a supermajority must vote in favor of any project, large or small, to be approved.
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