Guest writer Bill Geyer used a literary tool to explain TDRs. Update: The opponents website is now posted. It is worth checking.
“Think, think, think. What to do, Christopher Robin,” pondered Winnie the Pooh. “The 82 acre woods are vast, much to be protected, much to be valued, yet so much debt -- $3,200,000 – oh, bother. That’s more than all the honey pots we can gather. EeeOr says it’s a crisis. He says we must pick new commissioners of the woods, tax the villagers, and then give the villagers’ money to the City. If we do this for ten years, he says we can stay in the woods. I’ve been thinking, Christopher, isn’t there a better way? Wise Owl says we shouldn’t take the villagers hard earned pay. He says we don’t need new commissioners.”
“Did I hear my name?” asked Wise Owl as he flew in.
“How nice to see you, Wise Owl,” said Christopher Robin. “Tell us how to save the woods AND make this better.”
“It’s quite simple,” Wise Owl replied. “We sell the rights to build homes in the 82 acre woods to other areas where there are no woods. You see, no one is talking outside the woods, Christopher Robin.”
“Do you mean,” Christopher Robin said as he scratched his head, “that we wouldn’t have any houses in the woods, wouldn’t cut the trees or make it into a tidy little village, but it would stay for all the creatures forever and not cost the villagers a cent?”
“Who, I mean yes,” said Wise Owl.
“But how does it work?” asked Christopher Robin.
‘Well,” said Wise Owl, “you must think smart. You must first understand the woods are more than just land, streams, ponds and critters. And they must be protected. But the woods have something almost as valuable as all these things, much more valuable than all the honey pots, and enough to pay the City’s entire loan.”
“More than all the honey pots?” exclaimed Pooh Bear.
“You mean it would pay off the three million dollar loan?” asked Christopher Robin.
“Yes. If we think smart and are patient,” said Wise Owl.
“What does patience have to do with it?” asked Christopher Robin.
“Everything, my boy, everything. Let’s say we gather the finest thinkers in the village and plan with patience and intelligence – we will open the door for better answers. The loan isn’t due for five years – which gives plenty of time to sell the TDRs.”
“No more loan, no houses where animals should live, no money taken from the villagers - why Wise Owl, you have something here!” exclaimed Christopher Robin.
“And keep the honey pots?” asked Pooh.
“We can keep the honey pots,” said Wise Owl.
Christopher Robin wanted to know more. “Please tell me Wise Owl, exactly how would we do this?”
Wise Owl swiveled his head and stretched his wings to reveal a document. It was a short page which described the woods, listed the Council’s names, and included another item called “development rights.”
“Here is the valuable item,” Wise Owl declared. “The 82 acre woods have development rights to supply 714 single family or 1190 multi-family dwellings. The rights to build these dwellings can be sold as a transfer of development rights (TDR’s) to a village location. The price for each TDR is around $2,500 each, so selling them now would generate about one and a half million dollars. But with patience over the next four years the rights could be sold in a better market, and might be worth from three to five thousand dollars each, or even more.”
Christopher Robin quickly calculated the total and excitedly exclaimed “Pooh, that’s three and a half to five million dollars --enough to pay off the whole loan, and maybe more!”
“Oh wouldn’t that be a wonderful Christmas present?” Pooh Bear said as he reached for his hanky.
“Now finally the question arises. Who?” said Wise Owl. “Who can put this together?”
Christopher Robin thought long and hard. “I really know the villagers want to help, and some of them know how to do this, don’t they? We can ask them.”
“Yes, we can ask them. But first the villagers must say no,” said Wise Owl.
“What do you mean?” asked Christopher Robin.
Wise Owl explained, “The villagers will vote whether or not to create a new park district and elect commissioners. Funny even if the villagers do that, they have no say in setting the tax rate or where the money is spent. Only the commissioners can do that. So it’s very important, Christopher Robin, that the villagers say no. They must Vote NO on Proposition 1 and mail their ballots by February 12, 2013 to the County Auditor. Once a majority votes NO, we then can ask the City Council to sell the TDR’s.”
“And we can have a picnic in the woods?” Pooh asked expectantly.
“Most certainly,” said Christopher Robins, “we can have many picnics in the woods.”
“I like picnics, too,” cried EeeOr who was grazing nearby.
Think, think, think. Smart thinking can pay off the loan. A new parks district is not needed.
VOTE NO on Proposition 1. Then let’s propose a smarter solution.
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Bill Geyer, a 28-year South Hill resident, is a certified professional planner. He serves as the Chairman of Protect Bellingham Parks, the committee advocating realistic financial solutions to pay off the City’s $3,200,000 loan to the Greenways Endowment Fund.
Comments by Readers
Dan Pike
Jan 29, 2013With all due respect to the author, Winnie-the-Pooh would understand that the honeypot you have is the one that matters. Tricksters are always at the ready to try and get you to give up your honey—er, solution, and promise a better, grander one, if only you give up the one you have before you. The funny thing is, when I identify the voices advocating that we ‘save’ the forest another way, many are the same voices that advocated to let the forest be developed at multiple points in the past, including at the time the City entered into its purchase agreement in 2011.
Don’t fall for the bait-and-switch, no matter how cute the story: the proposed park district is a reasonable, effective, and fair solution to the problem. Don’t allow folks who were against saving the park at all hijack the process now and undue all that the community has accomplished.
John Servais
Jan 29, 2013Well, Dan, do you care to say that I am a past voice for development? No, I didn’t think so. And yet, I am very much against this issue. It is amazing to me to watch my so called liberal friends take such a low road of personal attacks in their effort to pass this ballot measure. Indeed, it is rather astounding for me to read you saying such things about another.
Dan Pike
Jan 29, 2013John, I would note that you are a complicated man, as are about 50% of us; the others are complicated women. Bill Geyer, the author of the piece, has certainly been a voice for development of the parcel in the past, which was my point. I’m sorry if you were offended by my language against Bill; I thought it was pretty bland—certainly more so than some inaccurate characterizations you’ve made against me in the past.
I doubt I’ve seriously wounded Bill; I’ve always appreciated his attitude in the public arena, even though I’ve more often than not disagreed with his perspectives—although I’ve also advocated for considering his perspectives inside City Hall, once upon a time.
In this instance, I am reminded of the saying, “Don’t lose the good in pursuit of the perfect.” I’m also aware that there are those among us who would use the desire for a perfect solution to keep the good from getting accomplished. When the Council nearly unanimously stated they would not even consider including this in a future greenways levy, that shuts off one of the avenues opponents advocate. When TDRs have been a consistent bust, both here and elsewhere, suggesting that in this instance we’ll suddenly find a magical solution to making them work, well, I guess I’d rather go with what I know does work—a limited term pay back through a park district taxing mechanism.
And I’m still confused what I said that you found so offensive. I’ve read many, many articles on your site that seemed to be intentionally aimed at insult, but left without editorial comment. I count many of the opponents to this proposal amongst my friends, and we have good discussions about why our perspectives are right or the others’ are wrong. The value of your blog is that it seems to be a place for such discussions to take place more broadly. However, if you find my comentary insulting, I guess I can stop commenting.
John Servais
Jan 29, 2013Dan, I was very critical of you while you ran for a second term as mayor. And it ceased the day the election was over. I was a very strong supporter of you for your first term, as you well know. Your actions in that first term turned me to look for a new mayor.
I called you out because of your having held high office - and should have a better take on issues.
You refer to Bill as a “trickster” and suggest he is practicing “bait and switch”. Your patronizing me, saying I’m complicated. We have an issue before us and I have provided a forum for debate on the issues. It has been sad to watch the stream of personal attacks coming from the proponents. Bill Geyer is not running for office. He has provided perspective on an issue. It would be nice for you and others to provide such instead of doing personality analysis.
Bill Geyer
Jan 29, 2013Dan, thanks for commenting, but your dialogue invokes identity politics to minimize the proposed solution. Using “tricksters” and diminishing the value of an opinion simply because someone advocated developing some of the site is a weak counterpoint. Focusing on the financial reality is more informative for the voters. Let’s review.
City residents own the 82-acre Woods. They paid for it with Greenways III funds. The Council members have a fiduciary responsibility to responsibly manage the site. When purchased in September 2011, you and the Council borrowed $3.2MM from the Greenways Endowment Fund to be repaid by December 2017. The site is the collateral. The site is currently zoned RM Planned which determines the number of dwelling units that could be built on the site. The number of units drives an appraised value called the residual land value. The more units that can be physically built on the site, the higher the value. Reducing the number of units that can be built on the site reduces the value.
The Council’s challenge (and their legal responsibility) is to determine the number of units that can be built (or not) on the site. They are legally empowered to make this decision as the elected officials on behalf of the citizens. The article above shows that if the Council decides no units should be built on the site, Council can still sell the units as TDR’s to another location. This mechanism is successful across the country. The market place determines the TDR value when there is a smooth TDR system. With some code corrections by the Council, Bellingham could have a smooth TDR system.
This is not “bait and switch”. This is critical thinking about the City’s asset and the financial impact on taxpayers. It is not politically motivated, but is based on sound, proven financial tools used by professionals in the field each day. It is not identity politics, but is sound land management that the City should have performed prior to completing the purchase in August 2011. Bellingham has four years to use this tool to repay the loan and save south Bellingham property owners from additional taxes. That’s a lot cleaner and more efficient than creating a new unit of government, a metropolitan parks district.
Donald Duck
Jan 29, 2013blah blah blah, tired of the talking heads and tired of the shell games. debt is debt, we can have it half paid before the experts are even done with their smoke and mirrors. or, they will do some stupendously stupid large ugly subdivision there, period. vote YES.
Wendy Harris
Jan 30, 2013Remember the TDR program for Lake Whatcom? Me neither. That is because the TDR program has not worked in Bellingham, or frankly, in most other places that have tried.
Where is the proposed receiving site for the Chuckanut Ridge? After all, that is the hardest part of making a TDR program work. A working market requires that receiving areas face a demand for denser development than is currently allowed. And that demand exists in places like Silver Beach, which is the opposite direction of where we need to head. And a TDR program is complicated, particularly in a City where there is great resistance to infill and even infill proponents admit that the infill toolkit does not work and needs to be amended.
TDR programs are normally used when a municipality lacks the financial resources to purchase the property that it wishes to protect. But here, the park district proposal provides the source of funding.
Sorry Pooh Bear, but your ill-considered TDR proposal needs to retire to the woods.
Nicholas Zaferatos
Jan 30, 2013I liked Bill’s story… the story suggests a very reasonable path forward.
It’s time to rethink our “free gifting” of increased property values every time the city rezones property. Wise Owl suggests looking at the TDR mechanism as a solution. Do they work? Of course they do. Throughout the nation they have served as a primary financing tool for thousands of acres of public lands acquisitions since the 1970s. Because they haven’t work in Whatcom County is not due to the tool, but rather, to the tool’s user. Unwilling to demonstrate sound land use management practices in general, is it surprising the county’s TDR effort has failed as well?
Bill’s tale reintroduces the tool of TDRs as a solution for repaying the loan balance. We create increased property values every time we wave the rezoning wand. We did so for the 100 acre woods back in the 1970s when those marginal lands were first inappropriately rezoned for higher density development. Thus, creating higher value. Higher value that the city taxpayers paid last year. We continue to create higher property values throughout the city in areas deemed “appropriate” for higher urban densities (especially in “urban villages”). Property owners in those locations get a windfall. The philosophy behind TDRs is that when we grant increased development rights, or windfalls, we ought to recoup “something”. That “something” could help pay for other public benefit - in this case – the 100 acre woods.
What’s needed is a city-wide system of property value exchange. TDRs can work and create a far more equitable financing solution for the community. Far more equitable than asking a portion of the citizenry to tax themselves for a property purchase that has already been inflated due to our own past zoning actions. The costly part in setting up a TDR program is, in fact, already in place – we already own the development rights that can be placed on the exchange market.
I really wish folks would stop bashing others’ opinions just because they engage, professionally, in the business of development. The author of the article has extensive knowledge about the mechanisms of public finance and public lands management, which he freely offers. Don’t trash his ideas just because he also participates as community builder. Instead, we should applaud the author, as a developer, for endorsing the idea of the community gaining an equitable return from future upzoning windfalls.
Tip Johnson
Jan 30, 2013Thank you Nick, for your on-target comments. And thanks for calling out the bad speech I am ashamed to witness from many of my friends. Much of it is more painful than reading Herald blog comments, because on the Herald at least I don’t know the people making the idiotic or unfriendly remarks. I am amazed at how intolerant district supporters are of any criticism or opposition. Geez, folks, that’s politics. We’re supposed to argue about these things, and if you think there is no legitimate opposing view on the issue, then you haven’t yet understood the issue. Finally, I’ll just add that the tenor of many such remarks is the best argument against the district I have yet seen. With advertising like that, you don’t really need opponents.
Wendy Harris
Jan 30, 2013John, Nick and Tip: I see nothing unusual about the tone of the comments for this issue, at least as reflected on NW Citizen. The folks who support the park levy have been open and transparent about their agenda. The opponents have been disingenuous and are being called out on this, as I agree they should. (I do support John’s efforts to reflect both positions on NW Citizen.)
The solutions suggested by opponents are intended to do one thing… allow more development (and if not on Chuckanut, then somewhere else.) They pretend this is about financial concerns, or park district transparency issues, or whatever hot button they can push… but it all comes down to a pro-development agenda. Everything else is an attempt to draw attention away from the pivotal issue: permanent protection of a natural resource of regional significance.
Come on, does anybody really think that a TDR program will work? TDR programs are complex, expensive and time consuming. They require development of attractive receiving sites and sophisticated zoning laws. It would take at least several years before the City would have something viable, if this is even possible. I want the City’s resources spent on important things like Lake Whatcom and the waterfront, not wasted on programs for which an identified funding source already exists.
The City does plenty for developers. It is time to do something for the people, the land and the wildlife.
Steve Wilson
Jan 30, 2013O Wise Owl, I’m all for pursuing the TDR concept AFTER the Parks District is established. I’m sure the citizens and commissioners would be happy to receive your dedicated service to reduce the levy burden, shorten the time frame of the levy and put this to bed once and for all.
Unfortunately I’m not willing to take the chance of putting all my eggs in your infinitely wise basket in lieu of a Parks District. I’m afraid you would get distracted in your busy life and forget to tend to those precious eggs.
Dan Pike
Jan 30, 2013Steve’s got it right. The problem with TDR’s in this community is that they compete with the County’s willingness to allow thousands of lots which were created unethically, at a minimum, in the 1990s to continue to compete in the market. Because our County has thumbed its nose at the Growth Management Act for over two decades with no repercussions to the electeds who perpetuated the law-breaking, or to the developers, landowners, and other interests that twisted the electeds arms for special consideration at the expense of public good, there is little to no demand for TDRs in this community.
In addition, there is a significant element of NIMBYism present within Bellingham that makes landing TDRs in any marketable area more challenging. See, plenty of blame to go around for TDR failure; it’s a nonpartisan issue.
So Steve is correct: TDRs would be a welcome addition to solving the funding issue, but given that there have been efforts to craft a workable TDR policy in this community for over a decade, at least, with no real success suggests that relying on them as a primary means to solve a 3 million dollar problem in less than five years is unrealistic. On the other hand, if your goal is to get folks to give up a real solution for a smoke-and-mirrors one that promises a better solution than the one in hand, yet never quite materializes so that what’s left are options like selling some significant parts of the property, well—let’s just say I guess I’m more cynical than some posting here are.
Donald Duck
Jan 30, 2013Nick, this isn’t a classroom; Tip, the heated banter here is no different than other issues. Wendy thanks, thats the first time I ever agreed with you. In the real world, no way either TDR’s or another Greenways levy or some private capital campaign will ever fly; its either vote YES or the city will sell and develop. a. big. ole. ugly. subdivision.
Gerry Wilbour
Jan 30, 2013Both before and after the City bought the property, advocates for it’s preservation spent considerable time looking into many ways to raise the money to pay off the loan. All possible ideas were investigated, no stone was left unturned. We didn’t begin this process intending to promote a Park District and allot of effort went into finding other solutions. We were open and actively invited the input of anyone who would participate. We met with neighborhood groups, city officials, the Mayor and Council. The CCFD idea didn’t float to the top of the list until it was clear that it was the only option that worked, even though we knew it would be a lengthy and difficult process. I can say with confidence, we did our due diligence. It maybe possible that some relatively small amounts of money can be raised by other means. If this were to occur, the levy amount charged by the CCFD would be lowered and/or shortened. That would be a good thing.
The City should make it’s zoning and density decisions based on the needs of areas and neighborhoods with significant public input. If higher density is warranted in an area, it should be granted through zoning, not sold for a City profit. Exploiting this option to raise money could lead to some very sketchy, perhaps illegal and controversial decisions. Sorry, making a public profit or covering a budgetary shortfall by selling density transfers of City owned property when it’s in a financial bind strikes me as horrible public policy. Zoning and density should be a regulatory function, and not be distorted by a profit incentive.
I am confident, the CCFD will win and we will soon be able to celebrate and move onto a much needed community based stewardship of the property.
John Watts
Jan 30, 2013For the record, TDRs can work, despite what the County does or doesn’t do. The City can make a TDR system work, but not automatically because it is a market-based system. Rezoning existing neighborhoods has been difficult politically, but string up the UGA for TDR-oriented zoning could work, providing the City gets serious about annexing small chunks at a time.
There is plenty of information available on this concept on the Internet, and I have published several blogs under that label on HamsterTalk.
The so-called ‘Chuckanut Ridge’ issue is a different story; it has been a problem in people’s minds for years since its mysterious up-zone during the time of Mt St Helen’s eruption in about 1981/82. Records on this specific transaction seem to be missing.
Local resistance to the enormous development proposal of several years ago was justified because the development scheme was unrealistic, largely based upon its underlying assumption of value. The reaction was swift from mostly Southside opponents, who ramped up rhetoric to levels that were also unrealistic. The ensuing kerfluffle not only stalled the project but created a rift in the community that persists to this day, as the current ‘issue’ demonstrates.
Suffice to say that the so-called ‘Responsible Development’ advocates did manage to create enough controversy to nearly prevent the Greenways III levy from ever being voted upon. Yes, the proponents of saving ALL the 100-acres Wood were willing to hijack a popular City-wide GW3 vote to get their way! Thankfully, that did not happen, but here we are again, faced with an intractable bloc of emotionally willful people who will do most anything to achieve their avowed wish, regardless of costs to the community as a whole. Sad, but true.
Many HamsterTalk blogs were dedicated to this one issue under the Greenways label.
Fortunately, GW3 passed, which allowed a later Council -with the encouragement of our [deservedly] 1-term Mayor Pike- to spend $3.2 million MORE than what was intended for any CR acquisitions. That brings us to the current situation.
While I don’t live in one of the Southside neighborhoods that will be voting on the Metro Parks District issue, I would not vote for it if I did. The reasons closely parallel the arguments raised by John Servais, and by Tim Johnson of Cascadia Weekly.
It is legal option, but it does set a silly precedent for an entire City that has repeatedly evidenced its strong support for the great Greenways program that benefits us all.
The Greenways system that has been in place prior to 2006 worked just fine, despite any perceived imperfections; the GAC did its work well and duly advised the City Council of its recommendations. Because of the nature of property and funding availability, every wish-list item could not be acted upon to everyone’s satisfaction; and this proved inconvenient for certain CR advocates, including 4 members of the Council who illegally made a ‘promise’ to purchase ALL of Chuckanut Ridge, not just part of it.
Council members Barbara Ryan, Terry Bornemann, Gene Knutson and Joan Beardsley made a pact among themselves supporting that ‘promise’. Councilmember Beardsley has since passed away and Ryan has retired from office, but Knutson and Bornemann remain from the original group of conspirators. Their most likely current allies might be Councilmembers Lilliquist and Fleetwood. Remember, all it takes is 4 Council votes to act on property acquisitions, despite what Greenways recommends. Lilliquist has already tried to derail the Mayor Linville’s idea of putting about 25 acres of CR up for sale to pay down the $3.2 million ‘loan’.
But, selling about 25 acres is the ideal solution, despite what opponents may claim.
Think about it; not all of CR is wetlands and ‘pristine’ woods likely to be inhabited by Pooh Bear! There are already existing homes adjacent to CR, including the residences of some of the most ardent -and NIMBY- supporters of the special Parks District Plan.
BTW, former Mayor Pike’s rationale on the above is misguided, at best. A better definition is ‘seriously flawed’.
My 2cents.
Shane Roth
Feb 04, 2013I take principled exception to spelling Eeyore’s name wrong.
Mike Rostron
Feb 05, 2013I do not live on the south side and so cannot vote, but I will still use the park occasionally, and I am happy to see folks have come up with a solution to funding it that does not require selling any of the land for development. Moreover, every wooded acre saved from development in Bellingham is a kind of victory. Ours is the most rural of mid-sized cities - let’s keep it that way! It is something to be proud of. More parks - less development is a praiseworthy goal. We should strive to get a reputation as the least friendly city in Washington to developers. It will not be the developers who pay the costs of the increased infrastructure, traffic, and necessary improvements to city services capacity that rapid population growth continues to make necessary.
Bake sales and benefit concerts have more chance of raising the 3 million than TDAs do!
Wendy is right - the city already does plenty to help developers, and the citizens are always left to pay for the messes they leave behind. What Bellingham needs is not more development - green or otherwise, but a rest from the rapid growth of the last decade - some time to put her house in order, and to face up to the reality that many residents, perhaps even a majority, would prefer we started having a real dialog about ways to slow growth, not encourage it.