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Strategies for achieving compact development
An array of local land use tools are available to make higher-density, mixed-use development possible in communities of all sizes.
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Linking compact development patterns to other key outcomes
Housing type and location contribute to lower levels of energy consumption in compact development, compared with conventional residential development. Compact development may also be more resilient following natural disasters.
|Comprehensive Planning |
Many states require that localities create and maintain an updated comprehensive plan that establishes a framework for long-term policy decisions about the built and natural environment. Other states offer incentives, such as eligibility for state grant programs, to localities that undergo a comprehensive planning process. The resulting planning document identifies, analyzes, and plans for the long-term needs of the community, articulating decisions about land use, transportation, public facilities, natural resources, environmental protection and other issues.
Several states, including California and Florida, require that a "housing element" be included in the comprehensive plan, describing the goals, objectives and programs for meeting current and projected housing needs. Click here to read about housing as a component of comprehensive plans.
The local comprehensive plan is an ideal venue to address growth pressures and outline approaches for managing them as well as a potential lever states can use to encourage more compact development. Washington State's Growth Management Act, for example, requires that the state's fastest growing counties and cities create a comprehensive plan that addresses specific state goals, including: sprawl reduction, concentrated urban growth, affordable housing, economic development, open space and recreation, regional transportation, and environmental protection.  Compact development is one of the solutions to meet the state's goals.
Click on the following links to learn more about comprehensive planning:
|Managing Development with Urban Growth Boundaries|
Local jurisdictions, including counties and regional governance bodies, adopt urban growth boundaries (UGBs) to protect open space and agricultural areas from sprawl and steer new development to areas within or adjacent to already-developed land. The land within the UGB is expected to accommodate projected growth for a limited period of time, typically 20-30 years, after which the boundaries may be revisited and expanded as needed. Areas within the UGB are eligible to receive public infrastructure and services, including sewers, roads, and emergency response services, which may not be extended to new development beyond its boundaries.
A number of metropolitan areas in the US have adopted urban growth boundaries; Boulder County, Colorado, Lancaster County, Pennsylvania, and Portland, Oregon are commonly-cited examples.
UGBs are a useful tool to promote higher-density compact development, revitalization and reinvestment in urban areas, and responsible use of natural resources. To the extent that they limit the supply of developable land, however, UGBs may also contribute to increased housing prices. It is therefore essential to pair UGB policies with comprehensive affordable housing strategies. Click here to read a brief analysis of the benefits and pitfalls of urban growth boundaries in Boulder, Colorado.
|What role do states and regions play?|
While localities exercise the most direct control over land use, state and regional entities have an important role to play in incentivizing, encouraging, and supporting local governments to adopt policies and regulations that support sustainable and equitable development. In addition to preparing their own planning documents, regional actors can provide technical and financial assistance to help localities update their land use plans. Regional entities can also help to promote coordination among local jurisdictions and provide funding support to facilitate specific projects. State agencies and departments can draw from a different set of tools to create a supportive policy framework, including focusing state infrastructure spending on location-efficient areas and amending funding criteria to favor projects in these areas.
|Rezoning and Upzoning|
Photo courtesy of BRIDGE Housing
|Comprehensive plans outline long-term policy goals to guide development at the local level, but without formal changes to zoning or other codes, planners may lack the regulatory tools needed to achieve the plan's objectives. For example, current restrictions on allowable densities may constrain a community's ability to pursue compact development. By revising zoning policies to "upzone" appropriate areas to allow a higher density of development, or increase density by reducing minimum lot sizes, required set-backs and/or street widths, communities can facilitate the delivery of a greater number and variety of homes at different price points that cater to different populations as part of a pattern of more compact development. These strategies work especially well near new or redeveloping transit stations or in village or town centers and other hubs where many land uses are co-located. |
|Solutions in Action|
|In 2005, town officials in Barnstable, Massachusetts, established a set of cross-cutting strategies to encourage development in downtown Hyannis (a village within Barnstable) as a way to offset growth in the outlying areas of town. Downtown Hyannis, an economically depressed area, was selected because of its growth potential, existing municipal water and wastewater infrastructure, access to regional transportation, and commercial and public services. To encourage new development, zoning in Hyannis was changed from a single-use, low-density commercial district to a mixed-use neighborhood, with density bonuses provided for including housing affordable to working families.|
As of 2011, the revised zoning code for downtown consists of seven mixed-use zoning districts created around a central transit hub. Town officials established a streamlined process to approve any project within the designated zone by eliminating the regional planning and land-use entity from the permitting process, thereby making all permitting for projects local. Town officials indicate that Hyannis' streamlined permitting process combined with the flexible mixed-use zoning has stimulated over 25 million dollars worth of private investment downtown as of 2007, with 10 percent of all new homes being affordable for working families.
Click here to leave this site and learn more about Barnstable's redevelopment efforts.
|Overlay zoning is a regulatory tool in which special requirements and allowances are applied on top of the existing zoning code to promote a specified public goal within a designated district. For example, overlay zones may be used to promote higher-density development near public transit stations or to protect threatened natural habitats. In Nashville, TN (see example below), the overlay zone provides design guidelines for the buildings within a given area, rather than specifying land-use type within the district. |
Overlay zones work well to support compact development or transit-oriented development areas because they can increase maximum density, establish density minimums, reduce parking requirements, and encourage mixed use development and pedestrian access to transit in targeted areas.  For example, in Eugene, OR, the city adopted a nodal development overlay zone that can be implemented in neighborhoods served by transit. The overlay zone specifies design guidelines, street pavement sections and densities for bus service and bus rapid transit nodes. Click here to read more about Eugene's nodal development overlay zone.
|Incentive-based overlay zoning|
Incentive-based zoning policies enable local governments to provide density bonuses and other incentives to developers in exchange for the delivery of specific public benefits and amenities. When used to stimulate affordable housing, incentive zoning looks a lot like a voluntary inclusionary housing policy. However, incentive zoning can also be used to stimulate a broad range of other outcomes, such as transit-oriented development. For example, in 2004, Massachusetts passed Chapter 40R, the Smart Growth Zoning Overlay District Act to create incentives for the production of higher density housing in existing town and city centers, near transit, or where infrastructure or location makes residential or mixed-use development suitable. With state approval, the establishment of a 40R overlay district allows a jurisdiction to proceed with as-of-right higher density residential development. It requires that 20 percent of the homes be affordable to households earning 80 percent or less of the area median income and provide housing opportunities for families with children.
The state provides the local jurisdiction with financial incentives ranging from $10,000 to $600,000, depending on the number of homes built. The law mandates a minimum allowable density of eight units per acre for single family homes, 12 units per acre for two- and three-family buildings, and 20 units per acre for multi-family dwellings. A complementary law, Chapter 40S, provides state reimbursement to the community for the net cost of educating students living in a unit built under 40R. Click here to leave this site and learn more about 40R and 40S.
|Planned unit developments (PUD), also called planned developments or master-planned developments, are a type of overlay zone that allows communities to set aside large swaths of land (typically 100 to 2,500 contiguous acres) within which traditional zoning rules may be waived in order to promote innovation and coordinated development. One study estimates that 40 percent of all residential units built in the U.S. are approved through PUDs.  Since PUDs are typically applied to large parcels of land under single ownership, they are commonly used to develop greenfield sites for residential purposes. PUDs also work in urban settings as a tool to encourage revitalization, permitting mixed-use development on infill lots. For example, in Washington, DC, PUDs are permitted to increase the density and height of buildings on designated parcels as small as one acre. In Bloomington, IL, PUDs can facilitate mixed-use development on underdeveloped parcels of land.|
Photo Courtesy of Jonathan Rose Companies LLC
|Cluster zoning, also called open space zoning, is a land use tool most commonly used by rural and exurban communities to preserve natural areas as development encroaches. Under traditional zoning policies, a parcel of land in an undeveloped residential district would be entirely carved up into individual lots, each reserved for development of a new home. Cluster zoning groups the same number of homes onto a smaller portion of the parcel, with the rest of the land remaining protected as open space through a covenant, conservation easement or other temporary or permanent preservation program. |
This zoning technique is often used to help maintain rural character and preserve open space; however, by allaying community concerns about the preservation of open space, cluster zoning may also help facilitate the approval of new development, thereby helping the market keep pace with housing demand to keep housing price pressures in check. The cost of infrastructure to serve this more compact development is also lower than it would be under traditional zoning, helping to further lower costs. To be effective, cluster zoning must be coordinated with other development and conservation priorities in the region; lack of coordination and planning can result in conservation subdivisions that further fragment natural resource land and increase the need for residents to drive to services, amenities, and jobs. 
In Bethel Township, Pennsylvania, cluster zoning was used on a 53-acre property to develop the Garnet Oaks residential neighborhood. Located on the site of a former farm, the property was built with 80 single-family homes while preserving 51 percent of the property as open space. The development firm that built the neighborhood was able to model the street pattern after the older neighborhoods throughout the township, emphasizing tree preservation to enhance the natural landscape of the area and help with storm water management. Click here to read more about cluster zoning.
|Conventional property tax systems are designed so that structures and land are taxed at the same rate. In contrast, split-rate (or two-rate) systems split the assessment, applying a higher tax rate to land and a relatively lower rate to structures on the land. The rationale for adopting this form of taxation is to stimulate development and improvements to existing structures. In location-efficient areas where land value tends to be higher, owners may have incentive to develop at greater densities to maximize use of the land. In areas with high rates of vacant and abandoned properties, split rate taxation can penalize speculative property owners who leave their lots unimproved. Proponents suggest that by discouraging owners of unimproved or underdeveloped property from leaving their property unimproved in the hopes that property values will rise substantially, split-rate taxation may stabilize land values, increase urban infill development, and reduce sprawl.|
Depending on home-rule status, communities may need statutory authorization from the state before adopting a split-rate system, and so far only a few jurisdictions in the United States have adopted this type of system. The best recognized example of split-rate taxation is Pittsburgh, PA, where tax rates for land were at one point nearly 6 times greater than rates for buildings.
Click here to read an article on property tax reform and smart growth from the Lincoln Institute of Land Policy.
|From the Forum… "...When residents and businesses move into these more remote locations, they discover that they do not have the infrastructure that they need. When infrastructure extensions are made, the cycle begins anew...The perversity of infrastructure is that public goods and services, intended to facilitate development, end up chasing it away... Cities must develop five times (or even ten times) as much infrastructure as they would need if development had occurred in a more concentrated and compact pattern. The result is very high per capita tax burdens and a shortage of funds to operate and maintain public goods and services. The transit perversity includes the fact that higher real estate prices displace existing or potential low- and moderate-income households who are most in need of transit services."|
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The HousingPolicy.org Forum is a place to pose questions, exchange ideas, and learn from the experience and expertise of others. This section of the site features interactive forums organized around policy areas, including inclusionary zoning.