Transferable Development Entitlements (TDRs) are a method by which developers can acquire development rights for certain parcels in a certain “home district” and transfer the rights to another “host district” in order to increase the density of their new development. The underlying legal concept of a development rights transfer program is the idea that all lands have a set of ownership rights.  It is used to control land use to complement land use planning and zoning for more effective management of urban growth and land conservation. RTD programs provide financial compensation to landowners who have chosen not to develop some or all of the land. Under communal zoning, these landowners have the option to legally separate development rights from their land and sell those rights to another landowner or developer for use elsewhere. Land with separate development rights is permanently protected by a conservation easement or restrictive agreement. The development value of the lands on which the transferred development rights are claimed is increased to reflect new or special uses; higher density or intensity; or other regulatory flexibility that would not have allowed zoning without the DPR option. One of the best-known examples of TDR is Penn Central Transportation Co. v. New York City (1978). The U.S. Supreme Court ruled that the city`s Landmarks Preservation Commission did not deny Grand Central Terminal owners economic value by denying them the right to build an office building above the station. Terminal owners had air rights that could be used as TDR to build higher-than-conventional zoning on their other properties.
 The TDR process can be seen as a tool to control urban sprawl by concentrating development. TDR is a legal mechanism offered in some local government jurisdictions as a form of development control. ToRs are also a means of avoiding constitutional problems caused by rezoning areas that would otherwise derive significant value from the property. The process provides landowners with financial incentives or incentives to preserve and preserve the environment, heritage or agricultural values of their land. The TDR is based on the concept that land ownership is accompanied by the right to use or develop land. These land development rights may be used, unused, sold or otherwise transferred by the owner of a property in certain jurisdictions. :3  *The deed of ownership is revised so that the right to build a house is revoked forever, even if the entire plot is sold. New Jersey Future offers two graphs that graphically show how it all works (PDF). Similarly, the Lancaster Farmland Trust (LFT) acquires ToRs from farmers and holds them until a suitable buyer wants the ToRs, often selling them with those sold by the community. LFT is also the TDR bank and program administrator for some rural communities in Lancaster County.
When selling ToR, LFT is not required to comply with the requirements of public tenders (although the sale price per TDR generally corresponds to the price of the municipality`s bid). For example, the Township of Honey Brook has had an active RDT program with broadcast and reception areas since the mid-2000s. In 2015, the community partnered with the neighbouring borough of Honey Brook to adopt a comprehensive plan for several communities. County officials agreed that the county serves as a reception area for community-generated RDTs, and in 2018, both municipalities passed new zoning ordinances that allow for the transfer of RDTs across their borders. The Township of Honey Brook has zoning districts for sending and receiving RDTs; The Borough of Honey Brook has zoning districts that allow for the reception of RDTs generated in the surrounding community. RDT programs have generally failed in situations where real estate market forces have not been factored into program design. Imagine the following scenario: RDT is one of many tools available to communities and regional organizations to manage growth and permanently protect valuable agricultural, natural and cultural resources. TDR can be even more effective when combined and adjusted with these other tools. Examples: The following sections of GPP allow the use of RDTs: Where effective agricultural zoning does not yet exist, some communities have delineated the RDT broadcasting area to increase the attractiveness of the RDT option to landowners. Similarly, some municipalities have reduced the size of the TDR reception area(s), so that the TDR option leads to more uses, more development or other flexibilities compared to traditional planning approaches (but without much more development than would have been allowed before the introduction of the TDR option). The dollar value of a TDR, for both a broadcasting area landowner and a receiving area developer, depends on a number of market and other factors. For example, a landowner who wants to sell RDTs will likely have some monetary value in mind for each RDT they want to sell.
Similarly, a potential RDT user will have a certain price that they are willing to pay, and this price is usually based on the projected value that the purchased RDT will add to the development. A TDR transaction typically occurs when an overlap is reached between the seller`s expectations and those of the buyer. For example, development rights may be transferred to residential or non-residential facilities. Residential complexes with RDTs typically include additional uses (e.g., townhouses in addition to single-family homes), special uses (e.g. e.g., seniors` communities), increased density (more housing units per acre) or flexibility in zoning and mass standards (variations in setbacks, parcel sizes, etc.). Non-residential buildings that use RDTs typically use increased space allocations, maximum building height allocations, or maximum impervious property coverage allocations.