Grassroots PDR: Just another acronym or a viable option for Bedford County? In the world of land use planning there are more initials to describe things than one might think possible. Purchase of Development Rights (PDR) is a relatively new concept used to describe how landowners may covert their investment in land into cash, while continuing to own and use their property. Some have described PDR programs as a way of having your cake and eating it too. PDR programs are already in place in Virginia and other parts of the country. The basic idea is simple. First, it may be helpful to think of property rights as a bundle of sticks, each one representing a right of land ownership. These rights include the right to sell, to subdivide, to bequeath, to construct buildings, to restrict access, to use, to lease, to mortgage, or to grant easements, which are limits on certain property rights. Right-of-ways for power company poles or access roads that allow other landowners to cross your property to reach theirs are examples of such easements. When you grant an access easement you transfer only one of the rights in the bundle to a third party. A PDR is a type of easement – essentially it is a voluntary choice made by a landowner to keep his or her land in its current state of open space and in rural uses, such as farming or timbering. Some owners of large tracts of land may want to subdivide their property. Others may prefer to realize the development value of their property without seeing it become a residential subdivision. To do so they sell their development rights to another entity – generally a municipality, state agency or private land preservation foundation – under a PDR program. The property owner is paid the appraised dollar value of the development rights in exchange for that owners’ willingness to forego subdivision on their land. The land owner retains all the other rights of property ownership. He or she still owns the land and has the right to sell it, to bequeath it, to restrict access, to construct buildings (for example, for family members), to use, lease and mortgage the land. Like easements for rights-of-way, these easements “run with the land” – that is, they continue to affect the title regardless of ownership. They provide the landowner with the assurance that the land will remain undeveloped by restricting intensive uses, such as residential subdivisions, while allowing traditional uses, such as farming. Land from which development rights have been sold can continue to be farmed or timbered and generate income. The owner and purchaser of the development rights negotiate a price based upon the difference between the present market value and the value of the land for farming, forestry, open space, recreation or rural use. For example, let’s assume a 100 acre farm in Bedford County, if sold for residential development, is worth $2,000 per acre, or $200.000. If it remains farmland, its agricultural value is $450 an acre, or $45,000. The value of its development rights is the difference between its present market value and the value of land as restricted – i.e. $155,000. Most owners receive a specified, annual payment for a period of years, which is equivalent to an interest return on the purchase price. At the end of this period the principal price, originally agreed upon, is paid to the owner. PDR programs provide for the land asset (often the largest in many agricultural estates) to produce income for a period of time and have the value leveraged for future returns. This has enabled some farm families to continue to operate – and even improve their property -- when the pressures of growing land values are forcing them to reconsider their options. The value of the land and neighboring areas may continue to increase because of the restrictions an owner has chosen to place upon it. Imagine the value of land with rural character in a community where the inventory of such land is rapidly disappearing. Virginia counties involved in PDR programs at various stages include: Albemarle, Chesapeake, Culpepper, Fauquier, Hanover, Henrico, James City, Loudoun, New Kent, Powhatan, Rappahannock and the cities of Suffolk and Virginia Beach. The James City County PDR Program, one of the most recent PDR programs in the Commonwealth, began its program in order “to protect open space, community character, farmland, and natural resources” within the county, which has experienced rapid growth in recent years. Its population has more than doubled since 1970. During that time, significant changes transformed the predominately rural character of the county into a more urban and suburban environment. Because of its unique historical and cultural assets, this locality views its new PDR program as a tool that is available for landowners to assist in shaping the character and direction of the community in the future. To learn more about the James City County program visit its website at www.jccEgov.com or write to James City County, Community Services, PDR Administrator, 5249 Olde Towne Road, Williamsburg, VA 23188 or call (757) 259-3161 to request information about its PDR Program. Many people in Bedford County, which is also experiencing rapid growth, wish to preserve and maintain the county’s rural character and have agricultural and rural land remain undeveloped and in some instances in its natural state. Most would agree that it is very desirable to have land preserved in those, or similar, conditions because it enhances the value of the surrounding areas. The question that frequently arises during the consideration of such preservation planning is the impact upon private property rights – a cherished value at least as old as the Commonwealth itself. The purchasing of development rights provides a sound compromise to a citizenry which wishes to preserve, and a landowner who wishes to maximize, the return on a valuable asset. Participation in a PDR Program is voluntary. Not all landowners will be interested in this option. These landowners can still subdivide their land to the extent allowed by current zoning and other local ordinances. But for landowners who wish to liquidate a portion of their land asset without losing that asset and who want to see the additional benefit of protecting their land from residential subdivision, a PDR Program provides another option. When the day comes that no one wishes to continue to operate a farm or maintain the land in its rural uses, another farm becomes a subdivision or an industrial park. Taxes escalate as localities struggle to pay for the community services – especially schools – required by these new residential areas. Bedford County is already experiencing this problem. Of the 20 fastest-growing cities and counties in Virginia between 1988 and 2001, Bedford County is one of the three localities with the greatest percentage increase in per-person tax collection. According to data from the state Auditor of Public Accounts, the per-person local tax collection increased by 93 percent in this period in Bedford County during this period. Taxpayers gain economic benefits from PDR programs. Every farm and open space area that is not developed not only enhances the value of surrounding areas, but also means there will be fewer demands on county resources. Economic studies show that property taxes do not cover the cost of services for residential development. By giving landowners an option other than subdivision, a PDR Program preserves or increases the net tax revenue to a locality and its citizens. An allocation of a portion of taxes revenues (combined with other sources of funding) may be a viable alternative in the years to come, spreading the benefits of a PDR program, as well as the costs. Change is inevitable. Nowhere is this more evident than in the growth of population, the needs and desires of that population, and the resulting impact this has on the land. As Bedford County works toward updating its Comprehensive Plan, it must look at the variety of options which are available to meet the needs and desires of its citizens. Many citizens believe that a PDR Program for Bedford County is a truly viable option – one that gives property owners a financial choice and taxpayers protection against the escalating taxes that come with rapid residential growth. If you believe Bedford County needs to explore developing a PDR Program, contact your representative on the Board of Supervisors today and stay tuned to this column for more information about conservation easements. Editor’s Note: Bedford Citizens for Land Preservation (BCLP) is a citizen-based, public foundation with the mission of supporting responsible growth in Bedford County while maintaining its rural qualities of life. BCLP is seeking volunteers for its committees and for its neighborhood-based “Pride of Place” project. To review information BCLP has gathered on growth and land use topics, visit the BCLP Resource Cart the Bedford Central Library or consult BCLP Notebooks at your local branch. For more information, visit BCLP’s web site: www.bedfordpresevation.org or write to BCLP, PO Box 86, Bedford, VA 24523.