The Pine Barrens Credit Program

Transferable Development Rights in Central Suffolk County,

New York

James T.B. Tripp

General Counsel, Environmental Defense Fund

Chair, PBC Clearinghouse, an advisory board to the Central Pine Barrens Joint

Planning and Policy Commission

•LI Central Pine Barrens: Critical watershed

of LI’s groundwater system

•1993: NY State Legislature passed the

“Long Island Pine Barrens Protection Act”

(New York ECL Article 57), protecting the

largest, “central” remaining Long Island

Pine Barrens region.

• Principal goals of the Act:

• Protection of ground, surface, and

drinking water for 1.8 million residents

of Suffolk County, LI

• Protection of a threatened landscape

found in only several locations in the

United States.

•Principal mechanisms: County and state

acquisition, planning and regulation and a

TDR program

•Planning and implementation entity: a five

member Commission made up of the three

town supervisors, Suffolk County Executive

and Governor Early Fall colors in the upland barrens,Rocky Point.

The Commission’s Purview

•Under NY Environmental Conservation Law

Article 57, the Commission produced and started

implementing a Regional Plan, the Central Pine

Barrens Comprehensive Land Use Plan, in June

1995.

•Produced during a strict two year planning period,

starting with the July 1993 legislation.

•Under the Act and the Plan, the Commission has

joint land use review, permitting, and enforcement

authority along with local municipalities.

• Operates a transferable development rights

and conservation easement program.

• Coordinates regional public lands stewardship

and management.

•For the Plan to take effect the Commission had to

approve it unanimously and each town had to certify

it and amend its zoning ordinances

Central Pine Barrens Land Use Categories &

Principles

1. Central Pine Barrens (102,500 acres) =

Core Preservation Area (55,000 acres) +

Compatible Growth Area (CGA) (47,500 acres).

2. Core Area development is prohibited without a

hardship permit from the Commission.

3. As of 1995, Core Area had about 13,000 acres

of privately owned, undeveloped land.

4. The Core and designated CGA sending areas are

eligible for “Pine Barrens Credits” - i.e.,

transferable development rights - in exchange

for a permanent conservation easement.

5. The conservation easements are permanent. The

Commission inspects parcels and enforces

easements.

Open fields, pastures, woodlands and both

fresh and salt water bodies are found

throughout the Core and the CGA.

Pine Barrens Credits – Transferable Development Rights

Program Building Blocks

1. Planning Goal – Resource protection and maintenance of

land value in the Core Area

2. Statutory Foundation – NY ECL Article 57

3. Sending Areas – Defined by statute and Plan

4. Allocation Formula - Defined in Plan and incorporated in

town zoning

5. Receiving Areas – Defined in regional Plan by Towns

6. Transfer and Redemption Allocation Rules –Defined in regional Plan

7. Oversight Board(s) – Pine Barrens Credit Clearinghouse

and Pine Barrens Commission

8. Seed Funding – From NYS DEC Natural Resources

Damages Unit settlement on ten year loan $5 million as

Clearinghouse capital As with a TDR program, pitch pine

reforestation takes time, well defined

goals, oversight, nourishment, labor,

and perhaps seed money to establish

long lasting roots.

Pine Barrens Credits – Transferable Development Rights

Sending Areas & Credit Allocations

• Core area properties and CGA sending areas are

eligible for Credits. Public and private conservation

lands are not.

• In exchange for Pine Barrens Credits, owners of

sending parcels relinquish their “nondevelopment”

rights through a recorded conservation easement.

• Allocation is based upon size (acres), zoning (1995),

existing road frontage and any existing development

on site.

• No reduction is made for wetlands, steep slopes or

other development constraints.

• Allocation may be appealed, and adjustment (if any)

based upon a hearing.

• Final allocation leads to a “Credit Certificate” in

exchange for permanent conservation easement.

• The new Credits go onto the market to be sold to

“redemptors” or “Credit wholesalers”.

Not reducing Credit allocation for

sensitive features encourages participation

in the Credit Program, and protection of

the barrens’ natural resources.

Pine Barrens Credits – Transferable Development Rights

Receiving Areas & Redemptions

• Receiving sites (outside Core) are defined by

individual towns & approved by the Commission and

rules governing base and bonus zoning are

incorporated into town zoning ordinances certified in

Plan

•“As of right” redemptions – local Planning Board

ministerial review. Under the plan, each town must

designate as-of-right receiving areas with enough

capacity to absorb all PBCs that could be issued to

sending area properties in that town.

•Although Plan establishes rules for TDR programs,

each town has primarily an intra-municipal TDR

program

• “Non as of right”(e.g., PDPs) redemptions –

discretion of individual Town Board.

• Redemptions may be residential, commercial,

industrial, or other. Redemptions possible through

County Health Department as septic “credits”.

Receiving Area Designations• “As of right” means that the redemption of a PBC entitles the redeemer to an

increase in intensity or density. Credits generated in any Central Pine Barrens

area in any town are redeemable for any as of right PBC use in each respective

town

• Brookhaven

– As-of-right transfer to one and two acre residentially zoned vacant lands

anywhere in the Town outside the Core Preservation Area with increased

density of 20% based on parcel size eligibility criteria through approval of

the Planning Board

• Total yield equal to the square footage of the total parcel contained within the

receiving site divided by the minimum square footage allowed under zoning

– Use of innovative planning techniques such as Planned Development

Districts or Planned Retirement Communities subject to certain

environmental constraints

– The Town Board may consider approving a PBC redemption requirement as

a condition of its approvals of the change in zoning

• Riverhead

– Town identified commercially zoned receiving districts which are eligible for PBCs in an as of right manner from the Core Preservation Area

– Single PBC shall permit an increase in density equal to 300 gallons per day per acre of the equivalent sewage flow as described by the Suffolk County Department Of Health

• Southampton

– The Plan and the Southampton zoning code identify specific as-of-right receiving areas with allowable density increases up to 2 units per acre

– Single PBC allows an increase in density equal to one dwelling unit

– No as-of-right transfer across school district boundaries

– Use of Planned Development Districts to accommodate PBCs through development schemes that convert PBCs to highly tax ratable uses with approval of Town Board

Pine Barren Credits – Initial Value

• Each town’s as-of-right receiving areas also had to

be of sufficient “quality” to make the TDR

program economically viable

• Economic consultant estimated likely range of

values of PBCs in each town based on receiving

area real estate values

– Calculated initial PBC value for each town at 90% of

low end of range of estimates

– Clearinghouse offered to purchase PBCs at the base

price starting on first day of Plans implementation

Pine Barrens Credits – Transferable Development Rights

Oversight and Administration

Pine Barrens

Commission

Pine Barrens Credit

Clearinghouse Board

New York State –

Governor’s Appointee

Peter A. Scully Mitchell H. Pally

Suffolk County

Executive

Steve A. Levy

+ representatives

Andrew P. Freleng

Brookhaven Town

Supervisor

Lori Baldassare

(Deputy Supervisor)

+ representatives

James T.B. Tripp

Riverhead Town

Supervisor

Philip J. Cardinale

+ representatives

Richard W. Hanley

Southampton Town

Supervisor

Linda A. Kabot

+ representatives

Robert Anrig

Credit Program

Duties

•Approves and

implements Plan

• Hears and decides

allocation appeals

• Establishes overall

policies

• Applies Plan, Chapter

6

• Oversees initial

Credit allocations

• Manages funds

• Establishes

operational policies

The members of these Boards

establish policy and direction

for the TDR Program. As

with these real wild turkey

tracks in the barrens, knowing

which direction you are

traveling can be confusing.

Pine Barrens Credits – Determining the Allocation

1. A “Letter of Interpretation” (“LOI”) is issued. This

is an estimate of Credits, based upon 1995 zoning, acreage,

and any existing development.

2. Applicant accepts or appeals. Accept? Next step is a

“PBC Certificate” and a conservation easement. Appeal?

Commission holds hearing and decides final allocation. The

appeals record to date is . . .

Brookhaven Riverhead Southampton

Number of Appeals

(an appeal may affect several parcels)30 0 25 55

Total Affected Parcels 169 0 150 319

Decisions Granting Additional Credits

(varies from amount sought)10 0 11 21

Additional Credits Allocated

(above the original LOI allocation)46.77 0.00 26.28 73.05

Decisions Leaving LOI Allocation Intact 19 0 12 31

Appeals Withdrawn Without Decision 1 0 2 3

Appeals Pending 0 0 0 0

Pine Barrens Credit Appeals Statistics 1996 through 2008

•Issued only by the

Clearinghouse

• Redeemable

• Saleable

• Transferable

• Serial numbered

• Assigned to a

specific owner (not

bearer documents)

• Registered with

the Clearinghouse

• Tracked by the

Clearinghouse

Pine Barrens Credit Certificates are . . .

• Issued simultaneously with the placement of a

conservation easement on the sending property, …

Promoting the Credit Program

• Pine Barrens Credit Registry – monthly listing of Credit

holders, sellers, Letter of Interpretation (LOI) holders, and

potential buyers.

• Regular reports – Certificates & Credits issued,

conveyed (with sales prices), redeemed, etc.

• Clearinghouse Board of Advisors meetings – open to

public with policy discussions and LOI applications.

• Commission hearings on Credit allocation appeals –

Public hearings as appeals are filed.

• Web Site – www.pb.state.ny.us

• Staff support and seminars – contact the office to

request either !

Role of PBC Clearinghouse

• Stimulate market in PBCs through reverse auctions

• Auctions credits that it has acquired

• Maintains PBC registry

• Works with the towns and commission to maintain and improve receiving area capacity and values

• Value goal – PBC program should provide as much value to sending area property owners as public acquisition program

• Some large property owners have decided to take PBCs rather than acquisition dollars

Clearinghouse PBC Purchases and Sales

• The Clearinghouse has an outstanding offer to purchase

PBCs in the three towns at a floor price

• It has purchased PBCs in Riverhead at the floor price

and in Brookhaven through a reverse auction

• It has held auctions to sell PBCs in its inventory

• It has sold PBCs at prices exceeding the purchase price

Easement Protected Lands

and Pine Barrens Credits

as of January 1, 2009

(Right: Robert Cushman Murphy County Park, Ridge)

Brookhaven Riverhead Southampton Total

Parcels 322 22 327 671

Acreage total 705.995 513.548 533.504 1753.047

Average parcel 2.19 ac 23.24 ac 1.63 ac 2.61 ac

Credits

generated

455.36 169.11 252.59 877.06

Credits

redeemed

194.91 45.44 80.404 320.754

Credits not

redeemed

260.45 123.67 172.186 556.306

Total value of

Credit sales

$14,141,313 $2,225,440 $10,452,364 $26,819,117

Intermunicipal Flows of Pine

Barrens Credits

as of January 1, 2009

(Like the Credits listed here, the Carmans River also flows

from the Core area out of the barrens. Shown here is a

segment in Cathedral Pines County Park.)

Destinations Originating from Totals

Brookhaven Town Riverhead Town Southampton Town

Brookhaven (District

200)

0.15 8.00 8.15

Patchogue (204) 0.20 0.20

Huntington (400) 1.00 1.00

Islip (500) 2.50 2.10 6.50 11.10

Riverhead (600) 0.00

Smithtown (800) 0.10 0.10

Southampton (900) 0.46 0.46

Quogue (902) 0.26 0.26

Southampton Village

(904)

7.84 7.84

Westhampton Beach

(905)

5.85 5.85

Totals 3.16 3.25 28.55 34.96

= 10.9% of all Credit

redemptions

“By the way, just what

are those Credits

selling for these days ?”

Pine Barrens Credits,

which protect resources

such as these, now have

a “decade plus” track

record of market values

and sales, so we can

answer this question with

historical data!

Year # PBCsSales

Value

Avg PBC

Value# PBCs

Sales

Value

Avg PBC

Value# PBCs

Sales

Value

Avg PBC

Value# PBCs

Sales

Value

Avg PBC

Value

1996 1.00 7,500.00 7,500.00 0.00 0.00 0.00 0.00 0.00 0.00 1.00 7,500.00 7,500.00

1997 31.18 383,140.00 12,288.01 56.17 561,700.00 10,000.00 4.52 48,814.00 10,799.56 91.87 993,654.00 10,815.87

1998 67.88 1,016,760.00 14,978.79 0.10 500.00 5,000.00 5.84 57,500.00 9,845.89 73.82 1,074,760.00 14,559.20

1999 54.95 1,445,902.00 26,313.05 18.19 245,600.00 13,501.92 0.72 8,050.00 11,180.56 73.86 1,699,552.00 23,010.45

2000 36.29 1,280,211.00 35,277.24 6.00 102,000.00 17,000.00 9.71 194,200.00 20,000.00 52.00 1,576,411.00 30,315.60

2001 29.04 1,142,000.00 39,325.07 7.00 118,000.00 16,857.14 0.89 19,900.00 22,359.55 36.93 1,279,900.00 34,657.46

2002 46.21 1,839,400.00 39,805.24 26.98 485,640.00 18,000.00 1.77 53,800.00 30,395.48 74.96 2,378,840.00 31,734.79

2003 60.02 2,920,350.00 48,656.28 0.00 0.00 0.00 4.44 173,450.00 39,065.32 64.46 3,093,800.00 47,995.66

2004 16.85 1,209,550.00 71,783.38 6.00 288,000.00 48,000.00 10.59 912,700.00 86,185.08 33.44 2,410,250.00 72,076.85

2005 2.00 232,500.00 116,250.00 2.15 146,000.00 67,906.98 40.89 3,047,900.00 74,539.01 45.04 3,426,400.00 76,074.60

2006 7.50 830,000.00 110,666.67 1.00 70,000.00 70,000.00 52.30 3,652,250.00 69,832.70 60.80 4,552,250.00 74,872.53

2007 13.68 1,353,000.00 98,903.51 2.10 208,000.00 99,047.62 16.55 1,488,350.00 89,930.51 32.33 3,049,350.00 94,319.52

2008 5.75 481,000.00 83,652.17 0.00 0.00 0.00 9.85 795,450.00 80,756.35 15.60 1,276,450.00 81,823.72

Totals 372.35 14,141,313.00 37,978.55 125.69 2,225,440.00 17,705.78 158.07 10,452,364.00 66,124.91 656.11 26,819,117.00 40,875.95

Pine Barrens Credit Sales 1996 through 2008

Brookhaven Town Riverhead Town Southampton Town Totals

Estimated Number of Remaining Parcels and

Acreages of Parcels Potentially Eligible for PBCs

Brookhaven

# Parcels/Acres

Riverhead

# Parcels/Acres

Southampton

# Parcels/Acres

Total

# Parcels/Acres

< 1 Acre 334/110 42/15 576/170 952/295

1-10 Acres 114/306 27/98 179/408 320/812

11-50 Acres 21/571 5/118 23/495 49/1,184

> 50 Acres 3/282 0/0 3/229 6/511

TOTAL 472/1,269 74/231 781/1,302 1327/2,802

Estimated Number of Potential Remaining

PBCs in the Core and Number of Parcels

Brookhaven Riverhead Southampton Total

Number of

PBCs

283 64 300 647

Number of

Parcels

472 74 781 1,327

Challenges

• Market for PBCs is limited

• Town grants changes of zoning for PDDs in receiving areas without requiring PBC redemption

• Highest value of PBCs is dominated by septage flow transfer use for commercial properties. This makes purchase of PBCs by residential developers difficult.

• Some sending area property owners have never responded to any Clearinghouse communication

• Towns tend to relax protection of receiving area capacity as years go by – constant education required

Accomplishments of TDR Program

• Has made a significant contribution to economic and equity underpinnings of the Act

• Has been responsible for preservation of over 1750 acres, almost 20% of core area land permanently protected to date (the land acquisition program accounts for the other 80%)

• TDR acquisition program values comparable

• Has mad a significant contribution to sustaining legality of plan and core area development prohibitions

• Reimbursed state DEC $5 million loan with $3.2 m still in Clearinghouse account