Friday, Sep 3, 2010
The Gristle
PDRs and TDRs
PDRs AND TDRs (and the difference between them): Ken Mann struggles to convince his fellow Whatcom County Council members to agree to an extension of the temporary ban on subdivisions around Lake Whatcom. In exchange, he promises to work like the dickens to develop a transfer of development rights (TDR) program that might reduce the number of developable lots in the reservoir watershed while still providing an economic benefit to landowners.
Mann seeks an economic, market-based solution so government doesn’t “continue these bruising philosophical debates over property rights and resource protection. With every election,” Mann observes, “we reverse past rules, initiate downzones or upzones, etc. If we can be the first to implement a robust and successful program, it will be a tremendous benefit to the county.”
In May, County Council discussed continuing a purchase of development rights (PDR) proposal to help preserve agricultural land. Through this program, the county uses money from the Conservation Futures fund to acquire the rights to purchase ag land at risk for conversion to other uses—notably, low-density subdivisions. Once purchased, a conservation easement is placed on the property to prevent it from being developed in the future. It remains in the ag land inventory.
A quiet but pricey success story, the county’s PDR efforts have acquired about 90 development rights, protecting 671 acres of quality farmland from future development. The program, over the past six years, cost roughly $4.5 million, with the county’s portion matched by state and federal grant money available for such purposes. Farmers thinking about parachuting into retirement through a land sale to speculators now have an option instead to receive that economic benefit while the public preserves a vital agricultural resource.
On the surface, the TDR program and the PDR program seem analogous—they reduce the amount of residential development in critical resource areas, while directing development to appropriate areas. Both assume that a public good is worth paying for, and that the most equitable way to make a public good permanent is through the market, to buy it outright. Both use public money to produce a beneficial public result.
But functionally, they’re quite different.
First, the public has a right to clean, safe water; and it is a right that, for the past century, has been interpreted by the courts to trump a property right. As we’ve noted before, property owners in the Lake Whatcom watershed can still place a home on five acres under the current moratorium zoning and sell it for a modest profit. What they cannot do—unless allowed by non-feasance of county government—is carve down their lots for additional profits and, in doing so, further imperil a drinking water resource for 91,000 people.
So one problem with Mann’s proposal is it treats citizens as hostages, forcing them to pay a ransom on something they’re entitled to by law—clean drinking water.
A brief history: In the ’90s, a culpable council rezoned the county for subdivision. Advising them to this action were advisory boards and committees stuffed with members who owned property in the affected areas, helping themselves to huge profits from this rigged conversion of resource lands. The zoning change that created this “divine right” to subdivide lasted perhaps ten years before citizen action halted it in the watershed in 2002.
Think of this as a gigantic transfer of wealth from thousands of county residents into the hands of perhaps two dozen land speculators, in a game designed and refereed by those same speculators. Should this be rewarded? Given that taxpayers are already on the hook for tens of millions of dollars for the environmental damage already created by this game, should it continue?
The second problem with Mann’s plan is it has proven unworkable.
The county has had a TDR program in place in the watershed since 1998. In only one instance has the program ever transferred a single development right out of the watershed.
For a TDR to work, another area has to be ready and willing to receive the density increase. In effect, a willing property owner in the receiving area gets to build an additional dwelling or two through the transfer. But wetlands considerations, housing market forces and similar challenges—to say nothing of the resistance of neighbors in potential receiving areas to accept such densities—have made the establishment of dedicated receiving areas all but impossible. No agreement exists with any city, or within any designated urban growth area, to receive these density transfers.
Indeed, in the only instance a development right was transferred, the county worked (with a willing land owner) to create TDR receiving areas for the King Mountain UGA. But in considering this area for annexation in 2009, the City of Bellingham reduced the requirement for receiving areas out of concern the program would further chill a depressed housing market.
For TDRs to work, if it is even possible for such things to work on a scale large enough to make them effective, there must be a constriction of developable land in order to create market pressures to cause density transfers to begin to make economic sense; but the county—and this council aggressively in particular—has been unwilling to consider such constrictions, whether in UGAs or in the county’s rural lands. Mayors of the smaller cities—starved for construction and real estate excise tax revenues—declared war on council incumbents who proposed such restrictions last year, endorsing the current majority.
Undaunted, Mann promises “to reach out to every jurisdiction and work on interlocal agreements.
“The incremental degradation of the lake by a limited amount of possible future development does not fall in the category of an emergency,” he believes. “The Lake Whatcom reservoir is a precious resource that past decisions by past councils have jeopardized. We can take steps now to remedy those mistakes, but the blunt instrument of a downzone is not one I am ready to take at this time.”
Hurry, Ken. The clock runs out in August.
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Ken Mann explains, “In both of my campaigns, in my written literature, I state that I support property rights and that downzones are a last resort and they represent a failure of government to plan.”
He admits, “There are reasonable arguments that the downstream impacts of development are damaging to health, safety, and welfare of the rest of the citizens and therefore development should, essentially, be illegal.”
Tellingly, he acknowledges, “I understand those arguments, they just don’t outweigh the arguments on the other side, to me.”
That is, in Ken’s mind property rights trump the public’s rights to expect protection of their health, safety and general welfare. This of course turns a century or more of water law and public policy on its head.
Moreover it puts Ken clearly in the camp of property rightwingers who can not grasp the laws and rulings on “takings.” It puts him in opposition to the exercise of the state’s police power, and leaves one to wonder if he takes seriously the oath to protect the public interest.
Ken, yes, there is a long history (as Tim reminds us) of failed government planning. Might I suggest the time is nigh, and you better make your reservations for “the last resort.”
Your pals have already worked us over with “a blunt instrument.” Now it’s time to right some wrongs.
posted by g.h.kirsch | 12:13 am, June 16, 2010
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Past Columns
August 24, 2010
THE ENTHUSIASM GAP: The enthusiasm gap continues apace in Whatcom County—with conservatives and tea partiers continuing their fired-up and well-organized march on the polls in November. Democrats and progressives (and… more »
August 17, 2010
KICK THE CAN DOWN THE ROAD: Whatcom County Council deserves praise (really!) for their decision to provide themselves more time to develop a transfer of development rights program for the… more »
August 10, 2010
TOO MUCH INITIATIVE?: Bellingham voters face a bewildering constellation of initiatives and tax measures on their November ballots. Bellingham City Council, acting in their authority as the board of a… more »
August 3, 2010
REFLECTIONS ON ELECTIONS: We’d mentioned in passing a few weeks back that the Bellingham Tea Party’s candidate forums at Whatcom Community College were excellent, and the Gristle would like to… more »
July 27, 2010
AND THEN THERE WERE NONE?: On the eve of their momentous vote to reverse the decision of a more progressive council to limit the size of Whatcom’s cities, the new… more »
July 20, 2010
BITTER BREW: Low taxes. Smaller government that listens to the public. Transparency, honesty and predictability in public affairs.
In the Gristle’s crude understanding, this is what conservatives want. This is… more »
July 13, 2010
SPARE CHANGE FOR THE BUS: Suffering from a transportation mobility problem of his own, Bellingham City Council member Terry Bornemann hobbled in from recent hip surgery to cast the critical… more »
July 6, 2010
P.S., THE ENGAGEMENT’S OFF: Like the letter that follows a bad breakup, a federal report confesses, yes, NOAA could have treated her suitors better, but she never really loved Bellingham… more »
June 29, 2010
BOBBY MAC AT BAT: Attorney General Rob McKenna scored an important victory last week for the state’s open government laws.
The United States Supreme Court agreed with AG McKenna and… more »
June 22, 2010
DNR DUST-UPS: A cooperative effort between the Dept. of Natural Resources and Whatcom County to transfer thousands of state timber lands around Lake Whatcom into county management can move forward,… more »
June 15, 2010
PDRs AND TDRs (and the difference between them): Ken Mann struggles to convince his fellow Whatcom County Council members to agree to an extension of the temporary ban on subdivisions… more »
June 8, 2010
EIGHT-BALL ENGINEERING: Whatcom County prepares to throw wide the doors for development around Lake Whatcom while simultaneously crippling the revenues that might fund even meager efforts to protect your drinking… more »
Ken Mann answered our questions:
As you note, diligence and persistence are key components of designing and implementing a successful TDR program. The reason they fail is because there is no demand for the “Development Right” and the prices are so low that nobody would ever sell one. Demand is low because their only use is to gain additional density in places where urban development is occurring.
Take this as an extremely simplified generalization: most developers of SFR’s are trying to build in the 3 or 4 homes per acre range. They don’t want to spend MORE to build MORE houses and make less profit. Their biggest return on investment and profit margin is usually at 3 house/acre.
The most important adjustment that I would like to make is to stimulate demand. Right now, whenever we change the zoning in an area to allow more development, we do not make many demands on the landowners when they go to subdivide and develop. I want to make those upzones contingent on purchasing TDRs. For example: if I own 10 acres on King Mountain, and the city decides to include my property in their UGA and change the zoning from 1 house per 10 acres to 6 houses per 1 acre, I have been handed a new density of 60 times my original! With the stroke of a pen, I gain 59 free additional development rights. Yay for me! With my idea, those 59 development rights would NOT be free.
I could build one house whenever I want, but for every house after the first, I would be required to purchase a TDR from somebody in the agricultural zones or critical watershed, or any other “sending area.” If we don’t stimulate demand for TDRs, this will be a wasted effort.
I have been inundated with reasons why it will never work. I didn’t say it would be easy, but if we don’t figure out a way to MAKE it work, we are going to continue these bruising philosophical debates over property rights and resource protection. With every election we can reverse past rules, initiate downzones or upzones, etc. If we can be the first to implement a robust and successful program, it will be a tremendous benefit to the county.
I plan to reach out to every jurisdiction and work on interlocal agreements. That is by far my preferred scenario and has the most potential for success. If that fails, we still have control over areas such as Birch Bay and Columbia Valley and the LAMIRDs.
In both of my campaigns, in my written literature, I state that I support property rights and that downzones are a last resort and they represent a failure of government to plan. A downzone absolutely has negative consequences for a property owner. We can argue about the extent of the damage, but I don’t know anybody who thinks that a downzone is beneficial to a property owner.
When the government decides to reduce development potential, that has material financial impacts on the owner. Basic principles of fairness indicate that those landowners are entitled to some form of compensation to mitigate those impacts.
There are decent arguments to be made that these are speculative investments and do not deserve government protection. There are reasonable arguments that the downstream impacts of development are damaging to health, safety, and welfare of the rest of the citizens and therefore development should, essentially, be illegal. I understand those arguments, they just don’t outweigh the arguments on the other side, to me.
As a community, we should be willing to pay for our clean drinking water. Of course, there can be situations where we have an emergency or new information comes to light that makes a downzone imperative.
The incremental degradation of the lake by a limited amount of possible future development does not fall in the category of an emergency (we have, currently in place, a moratorium on all subdivisions in the watershed and my fellow council members have indicated a willingness to extend the moratorium while we seek a TDR solution).
The Lake Whatcom Reservoir is a precious resource that past decisions by past Councils have jeopardized. We can take steps now to remedy those mistakes, but the blunt instrument of a downzone is not one I am ready to take at this time. If the TDR program fails then we have other tools that can dedicate funds solely to purchasing development rights in the watershed… We can tackle that idea next time!
—Ken Mann, Whatcom County Council