Thurston County, population 290,536 (2019), surrounds the Washington State Capital of Olympia at the southern end of Puget Sound, 60 miles southwest of Seattle. The County is active in farmland preservation efforts and has a successful purchase of development rights program in the Nisqually Valley. The County began to explore the use of TDR by authorizing a 1994 TDR feasibility study. According to the American Farmland Trust, experts who had worked in Montgomery County, Maryland determined that demand for TDRs would be marginal in the County’s cities. Nevertheless, the farmers urged the County to adopt a TDR program anyway with the understanding that it could take a decade for a TDR market to develop. In 1995, the County adopted a TDR ordinance that allows intra-jurisdictional transfers to two receiving area zoning districts under County jurisdiction as well as inter-jurisdictional transfers to the seven incorporated cities within the County.
Thurston County down zoned 11,550 acres of land in its Long-Term Agricultural District from a prior density of one unit per five acres to a new density of one unit per 20 acres. As compensation, development rights can be transferred from these sending sites at the rate of one TDR per five acres. The Transfer of Development Rights Section, Chapter 20.62, that appears in the Thurston County Code of Ordinances in November 2020 is almost unchanged from the original program adopted in 1995 and modified in 1997 and 2001.
Sending areas consist of roughly 11,550 acres of land in ten areas zoned Long-Term Agriculture District. The underlying requirements of this zoning district apply to owners who choose not to sell TDRs. Allocation is at the rate of one TDR per five acres of sending area land minus one TDR for each residence or structure housing a legal non-conforming commercial use. The reduction does not apply to farm housing units or to family member units as defined in the Thurston County Code.
Interested sending site owners must submit applications for Certification of Transferable Development Rights. The application must include a title report, the number of dwelling units, family member units, and farm housing units as well as a map of the proposed sending area. If all the required information is provided, the County issues serially numbered individual certificates for each TDR. The ordinance originally also required a survey. However, surveys came to be viewed as too expensive and an obstacle to participation. At the recommendation of the County’s Agricultural Advisory Committee, the survey requirement was ultimately removed and the County now relies on existing assessor’s data to calculate acreage.
Before the conveyance of certified TDRs can occur, a TDR easement is prepared, which includes the serial numbers of the TDRs certified for the sending parcel. The covenant, which runs with the land in perpetuity, states that the sending parcel may be developed or subdivided for residential purposes only if TDRs have been reserved for on-site construction. A reserved TDR must be attached to a legal lot by a Document of Attachment in order for a residential unit to be built.
Certified TDRs are conveyed only by Deed of Transfer. This deed must be recorded along with the appropriate TDR Easement on the subject property. TDRs may be held for a period of time and transferred to an intermediate party or broker before they are used on a receiving parcel. The plat for any property receiving TDRs must document recordation of the Deed of Transfer, the TDR Easement, the serial number of the TDRs involved, and the document attaching the TDRs to the subject parcels.
There are two residential zoning districts that serve as receiving areas for land under County jurisdiction. In the R 3-6/1 District, the minimum density is three units per acre and the maximum density is six units per acre, however, TDR purchases are needed to exceed five units per acre. In the R 4-16/1 District, the minimum density is four units per acre and the maximum is 16 units per acre except that any density greater than 15 units per acre requires the purchase of TDRs.
In addition, the program allows for inter-jurisdictional transfers to any of the seven
incorporated cities in Thurston County. To date, receiving area zoning has been adopted in three cities in northern Thurston County: Olympia, Lacey, and Tumwater. All three cities decided to confine the use of TDR to residential projects.
The Olympia program is of particular interest because Olympia allows TDRs to be used to either increase density from seven units to eight units per acre or decrease density from five units to four units per acre in its R 4-8 Zoning District. Olympia offers this incentive because there is a strong demand for low-density development. If developers choose not to buy TDRs to achieve lower density, Olympia at least gets the more compact development that it wants. Alternatively, when developers are allowed to build at lower density, at least the City benefits from the permanent preservation funded by the purchase of TDRs.
In about 2016, Thurston County posted a snapshot of all of its agricultural preservation programs including TDR. Two projects preserved a total of 181 acres of farmland. The credits were used in two residential receiving projects to allow additional density in 2011 and 2014 with average credits costs at $17,000 each.