(Profiled 6-24-21)

The Tahoe Regional Planning Agency (TRPA), regulates land use and environmental protection for a region that encompasses the City of South Lake Tahoe, California, plus two counties in California and three counties in Nevada. The TRPA is tasked with improving and protecting the water quality of Lake Tahoe, which still retains extraordinary clarity despite attracting millions of visitors, including winter sports enthusiasts who flock to the ski resorts surrounding the lake. The region consists of the entire 207,000 acre Tahoe Basin which TRPA manages using various initiatives and regulations including a complex TDR program. 

Lake Tahoe’s clarity has been recognized by designation as an outstanding national resource under the federal Clean Water Act. However, the lake and region were threatened by development spurred by the rising popularity of skiing, the 1960 Winter Olympics held here at Squaw Valley Ski Resort, and federal gambling regulations that made the Nevada side of the basin extremely attractive for large casinos. California and Nevada recognized that the environment could not withstand massive growth and signed a bi-state compact which was ratified by the US Congress in 1969. TRPA was subsequently launched and ultimately adopted regulations for land coverage and growth rates that incorporated programs for transferring rights. These programs, as described immediately below, originally limited conversion between various land uses (residential, tourist lodging, commercial) and contained approval requirements for transferring rights between jurisdictions. However, subsequent revisions have relaxed or eliminated some of the limitations originally placed on the region-wide TDR market, as discussed at the end of this profile.   

Land Coverage Transfers – In 1987, TRPA promulgated a set of ordinances that addressed allowable land uses, rates of development, density, scenic impact, and land coverage limits aimed at minimizing water runoff, removing contaminants, and reducing erosion on land with a wide range of permeability due to soil type and slope. In some areas, up to 30 percent coverage might be allowable without creating degrading amounts of sediment runoff and erosion. Conversely, the most sensitive sites in the Stream Environment Zone (SEZ) might be confined to as little as one percent of a site’s total land area. These coverage regulations can constrain the ability to build new structures or expand existing buildings. 

As mitigation, TRPA developed a land coverage transfer program offering property owners the option of buying coverage rights from sending sites that permanently preclude excess coverage. The sending sites must be classified as more sensitive than the receiving sites and both sending and receiving sites must be located in the same hydrologic zone. There are nine hydrologic zones in the basin. Generally, the transfer ratio is one-to-one, meaning the amount of bonus coverage allowed at the receiving site is equal to the amount of coverage prohibited at the sending site. The maximum coverage allowed with transfers varies depending on whether the receiving site project is commercial, tourist lodging, public facilities, or residential development (which also can vary depending on the size of the project). Receiving site owners can buy land coverage rights on the private market or from the California Tahoe Conservancy, which manages a land coverage bank. 

Transfers of Allocation – In order to keep growth from overwhelming the capacity of public infrastructure and services, TRPA sets annual limits on the amount of development allowed in the basin. For example, the quota might be 300 dwelling units, 400,000 square feet of commercial development, and 200 rooms of tourist lodging units. In this transfer mechanism, the sending site must be vacant, assigned a land capability classification that is so sensitive the site is ineligible for development, and permanently precluded from development by either deed restriction or ownership by a public or private non-profit agency tasked with open space preservation. The receiving site must have a less sensitive land capability rating than the sending site and be planned for residential development, 

Transfers of Development Rights – TRPA requires each new residential unit to have a development right as well as an allocation. To facilitate these acquisitions, TRPA allows residential development rights to be transferred within various parameters. TRPA aims to remove inappropriate existing development from sensitive sending sites by allowing owners to sell development rights for removing existing structures and returning the sites to a reasonably natural state. This removal/restoration process creates both a development right and an allocation because the transfer creates no net increase in development. Under TRPA’s quota system, these transfers have the potential to generate a strong incentive to remove inappropriate development from sensitive areas. 

Recent Amendments – Until 2018, there was limited opportunity to convert rights between three land uses: residential units of use (RUU), commercial floor area (CFA), and tourist accommodation units (TAU). In 2016, TRPA hosted a Development Rights Strategic Initiative aimed at addressing low convertibility and other constraints on the development rights marketplace that were slowing down the replacement of older, environmentally-harmful development with new construction designed to minimize environmental impacts. Five main recommendations evolved from the initiative.

• Use environmentally-neutral exchange rates to allow conversions between different development rights: RUU, CFA and TAU.
• Expand opportunities to qualify for the residential bonus unit incentive program.
• Expand the development rights banking system.
• Remove overlapping, multijurisdictional approval requirements for development rights transfers.
• Remove the requirement to have an approved project on a receiving site prior to the transfer of development rights.   

In 2018, the TRPA Governing Board adopted these recommendations.

• Section 51.4.3 of TRPA’s Code of Ordinances allows for the conversion of CFA, TAU, Single Family Existing Residential Units of Use (SF ERUU), and Multi-Family Existing Residential Units of Use (MF ERUU) using a table of 16 possible conversion ratios. For example, 300 square feet of CFA from a sending site can be used at a receiving site to add 300 square feet of CFA, one TAU, 1 SF RUU, or 3/2 MF ERUU.

• The Code allows a portion of the residential bonus pool to be allocated to units of “achievable housing”, meaning households with above median income yet not able to afford median priced housing. In addition, Section 51.5.1.C.3, Transfer of Potential Residential Units of Use to Centers; Bonus Unit Incentive, grants additional units to receiving areas in centers according to a formula that increases the transfer ratio based on the land capability district of the sending site and the distance of the sending site from centers and primary transit routes. Chapter 52 additionally uses a points system to award bonus density to receiving sites that participate in various mitigation measures such as environmental improvement programs for transportation, water quality, and SEZ restoration as well as access to outdoor recreation sites and scenic quality improvement programs approved by TRPA.  

• The 2018 amendments eliminated the requirement for approval from local government of both the sending and receiving sites, a requirement that was recognized as complex and costly. However, a local government can ask the TPRA to create a local approval process if the net loss of development rights resulting from transfers over a two-year period is equal to or greater than five percent of the total existing built development rights for each type of land use (CFA, TAU, RUU) within that jurisdiction.

• TRPA committed to partnering with the California Tahoe Conservancy, the Nevada Division of State Lands, and private non-profit conservancies to increase the development rights holdings in TDR banks. 

• The 2018 amendment increased flexibility and user-friendliness by eliminating the need to have an approved project prior to a transfer. TRPA also committed to expanding its development rights tracking and inventory capabilities and highlighting redevelopment success stories.