Item Coversheet

New Business and Commission Requests - R9  W




COMMISSION MEMORANDUM

TO:Honorable Mayor and Members of the City Commission 
FROM:Alina T. Hudak, City Manager 
DATE:March  27, 2023
 



SUBJECT:PROPOSAL FOR A TRANSFER OF DEVELOPMENT RIGHTS (TDR) PROGRAM TO INCENTIVIZE WORKFORCE AND AFFORDABLE HOUSING.

RECOMMENDATION

The Administration recommends that the City Commission discuss the proposal for a Transfer of Development Rights (TDR) program and provide policy direction.

BACKGROUND/HISTORY

On September 14, 2022, at the request of Commissioner Ricky Arriola, the City Commission referred a discussion item regarding the creation of a Transfer of Development Rights (TDR) program, including receiving and transfer districts, to the Land Use and Sustainability Committee (LUSC). This referral was made as part of the First Reading discussion on the proposed Resiliency Code and Land Development Regulation (LDR) Updates (Item R5 E).

On November 16, 2022, also at the request of Commissioner Ricky Arriola, the City Commission referred a discussion item regarding the creation of a Transfer of Development Rights (TDR) program, including receiving and transfer districts, to the LUSC (Item C4 B). For purposes of discussion, both referrals have been combined into a single item.

On January 25, 2023, the LUSC discussed and continued the item to the February 15, 2023 meeting. On February 15, 2023, the LUSC discussed and continued the item to the March 1, 2023 meeting.

On March 1, 2023, the LUSC discussed and moved the proposal to the full City Commission as an R9 discussion item, with the following direction:

1. The Administration will identify additional potential areas in North Beach, in addition to those areas included in the LUSC memo.
2. Specific details for sending and receiving sites shall be provided, including how funds will be used for restoration and resiliency enhancements of historic properties in sending districts, as well as the use of bonus floor area ratio (FAR) for workforce and affordable housing in receiving districts.
3. A sunset provision for the TDR program.
4. An FAR cap for receiving districts.

Additionally, Commissioner Richardson requested to be added as a co-sponsor.

Transfer of Development Rights (TDR) is a mechanism whereby property owners in a sending district can sell or transfer unused development rights, such as floor area or density, to a receiving district where there is additional demand to develop. Although the sale or transfer of development rights is typically a private transaction, such programs usually require that a specific public benefit be provided to transfer the development right. The public benefits can consist of a wide range of options such as improvements to public infrastructure, transit, housing, historic preservation, or environmental and sustainability efforts.

Pursuant to Section 1.03(c) of the City Charter, a TDR program within the City of Miami Beach would require a ballot referendum, as the increase in floor area ratio (FAR) within a receiving district is considered an increase in zoned FAR. Should the public approve the program, implementing legislation would have to be adopted into the Land Development Regulations (LDRs). Such implementing legislation would establish sending (transfer) districts and receiving districts and contain all necessary safeguards to ensure that City and resident goals are carried out. Generally, this ensures that the overall development capacity of the jurisdiction is not increased, while allowing for new development in certain areas.

ANALYSIS

Pursuant to the direction of the LUSC, a local TDR program has been drafted to incentivize the long-term preservation and resiliency of historic buildings while at the same time encouraging workforce and affordable housing. The proposed framework of the TDR is predicated on the following:

1) A binding agreement to retain, preserve, restore, and enhance the resiliency of the existing structure on the proposed sending site; and

2) A binding agreement that the receiving site would meet specific benchmarks related to workforce and/or affordable housing, height, and a cap on the total amount of development rights that could be received.

Approval by the Historic Preservation Board (HPB) would be required through a Certificate of Eligibility process for property owners to avail themselves of the ability to sell unused floor area that may be located within a local historic district. Through this process, the HPB would be expected to place conditions to ensure that the building is restored in an appropriate and timely fashion, as well as maintained in perpetuity, and is made resilient. Prior to allowing for the transfer of unused development rights to take place, City staff could ensure that the applicant has complied with all conditions of the Certificate of Eligibility through a Certificate of Transfer process.

As part of a TDR proposal, receiving districts would be established that contain zoning and land use criteria that receiving district properties must comply with. The regulations would include outside limits on how much FAR can be received by an individual property, as well as height limits, and minimum requirements for workforce and affordable housing. Additionally, requirements for providing other public benefits could be incorporated, such as requiring the development of infrastructure, or resiliency enhancements. However, it is important that such requirements don’t limit the economic viability of development if it is to be successful.

Proposed Sending Areas
The following historic districts have been identified as sending districts:
• Flamingo Park Historic District (exclusive of single family zoning districts);
• Ocean Beach Historic District;
• Museum Historic District;
• Collins Waterfront Historic District;
• Normandy Isle Historic District;
• North Shore Historic District; and
• Flamingo Waterway Historic District.

In addition to receiving approval from the HPB, as noted above, the following additional requirements would apply to any eligible property within a sending district:

1. The existing site shall not be non-conforming in terms of maximum allowable FAR and shall be required to retain a minimum of .25 FAR for the property after the transfer of available FAR.

2. The property owner of the eligible property within the sending district shall be required to record a covenant, in a form acceptable to the City Attorney, memorializing the proposed transfer of available FAR.

Potential Receiving Areas
The following areas of the City have been identified as receiving districts:
• The C-PS2 district along the Fifth Street corridor;
• The CD-2 district along the Alton Road corridor;
• The West Avenue corridor, from 8th Street to Dade Boulevard;
• The CD-3 district along the 41st Street Corridor;
• The CD-2 and MXE districts between 73rd and 75th Street; and
• The CD-2 district on Normandy Isle.

The following additional requirements would apply to all receiving districts:

1. The maximum allowable bonus FAR that may be transferred to a single development site in a receiving district shall be 2.0.

2. At least 75% of bonus FAR transferred to a receiving district shall consist of workforce or affordable housing.

Additional Provisions
The proposed TDR program would have a sunset provision of five (5) years from the date of adoption of the enabling legislation, which would occur if a ballot measure is approved by the voters. The City Commission, at its discretion, could extend this sunset provision.

The City Commission, at its discretion, can also provide a framework for additional public benefits either as a requirement, or based on the amount of floor area transferred.

SUPPORTING SURVEY DATA

N/A

FINANCIAL INFORMATION

No fiscal impact is anticipated. 

CONCLUSION

The Administration recommends that the City Commission discuss the proposal for a Transfer of Development Rights (TDR) program and provide policy direction. If there is consensus on moving forward with the sending and receiving districts identified herein, it is further recommended that a draft ordinance be referred to the Planning Board and that the required ballot questions for an FAR increase be drafted.

Applicable Area

Citywide
Is this a "Residents Right to Know" item, pursuant to City Code Section 2-14? Does this item utilize G.O. Bond Funds?
Yes No 

Strategic Connection

Mobility - Support affordable, compatible workforce housing.
Legislative Tracking
Planning
Sponsor
Commissioner Ricky Arriola and Commissioner David Richardson