(Profiled January 2021)

Cupertino, California, population 59,276 (2019), sits at the eastern base of the Santa Cruz Mountains, ten miles west of downtown San Jose. It is home to the Headquarters of Apple and in 1973 it adopted a form of TDR that allowed Apple to continue thriving within the city.    

As the tech industry was starting to boom in California’s Silicon Valley, Cupertino realized that traffic would need to be managed in order to maintain acceptable levels of service in its DeAnza/Stevens Creek commercial corridor. If left unchecked, unrestricted development in this corridor would require roadway widenings that were considered unfeasible. To implement the Cupertino General Plan’s policy on this issue, the city adopted its Traffic Intensity Performance Standard (TIPS), which established a baseline level of development in the DeAnza/Stevens Creek Corridor in terms of afternoon peak-hour motor vehicle trip generation. Specifically, the baseline was 16 one-way trips per acre in the PM peak hour. This baseline could be converted to various types of land uses using PM peak hour trip generation factors contained in the city’s Development Intensity Manual: 0.75 trips per residential unit, 1.0 trip per 1,000 square feet of office space, 2.0 trips per 1,000 square feet of general retain floor area, 3.5 trips per 1,000 square feet of restaurant and so forth. The trip generation rates for land uses not listed in the TIPS Manual could be calculated based on a traffic engineering study or preexisting research findings. 

Cupertino realized that some developments would not reach the baseline of 16 PM peak-hour trips per acre while others would need to exceed that baseline in order to locate within the corridor. Consequently, TIPS allowed PM peak-hour trip rights to be transferred from sending to receiving sites within the DeAnza/Stevens Creek planning area by conditional use permit (CUP). In addition to the usual findings required to approve a CUP, the city had to determine that the transfer would retain a viable level of development on the sending site. Covenants are recorded on the sending and receiving sites to document these transfers after approval.

At its peak, trip rights in this program were selling for $50,000 each. Some developers acquired trip rights before they needed them in anticipation of rising value over time. After 40 transfers, development had reached the capacity for the entire corridor. Apple’s 750,000 square foot research and development office park was made possible by the acquisition of 322 trip rights from three separate sending sites. Consequently, this program allowed a major employer to stay in Cupertino without overwhelming the capacity of the city’s transportation network. Cupertino provided a model for using transfers to allow necessary flexibility in the location of development within finite infrastructure systems. This model has since been emulated in other California cities including Burbank, Irvine, and El Segundo.