Transfer of Development Rights at Gaviota Gateway Debated Again

In the ever un-sexy universe of land use policy, the transfer of development rights (TDR) concept is a never-before-seen though long-rumored aberration of beauty. Offering up the ability to “transfer” development out of sensitive, scenic areas into more urban landscapes without shortchanging the landowner or developer, TDRs have the potential to be the ultimate arrow in the Santa Barbara conservationist’s quiver. That is, of course, if an actual TDR protocol existed.

As Orange County developer Matt Osgood’s plan for 73 luxury homes at the gateway to the Gaviota Coast crawls through the approval process, Santa Barbara County planning commissioners spent several hours last week exploring the feasibility of the TDR concept and how it relates to Osgood’s Santa Barbara Ranch, popularly known by its historic name, Naples. In the end, the commission shied away from either a definitive thumbs-up or thumbs-down, opting instead to have its staff explore the issue more thoroughly and return in a month with a clearer picture of how TDRs would work with the 485-acre property. Testifying before the planning commission on Wednesday, September 26, Marc Chytilo, an attorney for the conservation-urging Naples Coalition, summed up the significance of the TDR debate when he explained, “Where Naples goes is going to be a harbinger of where the rest of the Gaviota Coast goes.”

Since 1997, Osgood has been attempting to gain approval for his plan to build out the ranch with as many 73 expensive, rancho-styled family homes, ranging in size from 3,700 to 13,000 square feet. Aside from meeting formidable resistance in the community at large and running into various county stumbling blocks, the development would require a massive re-zone of the property from its current designation before Osgood could break ground on his dream. Due to the county’s 1984 Naples-specific coastal policy, that re-zone can be approved only if the concept of TDRs is deemed infeasible.

More than 18 months ago, the Ventura-based Solimar Company began a TDR study at Naples. The initial reaction by the county supervisors last year to a preliminary draft was one of skepticism, but the study continued until last week, when Solimar’s researcher Darren Greve presented the findings. “We left no stone unturned in this process,” Greve told the commissioners and the several dozen members of the anti-development public in attendance. “Based on our work, we feel it is unrealistic to transfer all the development out of Santa Barbara Ranch,” said Greve. “But certainly some transfer of development is possible-just how much remains to be seen.”

In its most basic sense, a TDR works by creating a bank that stores both capital funds and development rights. When a development is underway within the urban limit lines, a developer may go to the bank and pay into it in exchange for increased density on his or her building site. Then, when a project is proposed for an area-like Naples-that the public wants preserved, the TDR bank would use its cash to buy down the planned project by purchasing as much of the development rights as possible.

It’s a complicated dance, requiring the cooperation of both city and county governments as well as the willing participation of multiple developers. A successful TDR really boils down to whether or not the price that the bank offers to pay the developer for the building rights is perceived to be fair market value.

In this regard, the TDR value of the individual buildable Naples lots, according to Solimar, varies from $1.6 million to $2.2 million. Speaking on Osgood’s behalf, attorney Stan Lambert told commissioners that “Santa Barbara Ranch would not be willing to accept a TDR at these prices. We could probably do much better on the open market.”

The Planning Commission will take up the issue again at the end of October.