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What Is a Transfer of Development Rights (TDR) Program?

The folks at New Jersey Future, a SmartGrowth advovacy organization, have a similar explanation (PDF).

What is a TDR program?

Hey wait--how can somebody get a portion of the purchase price from the sale of a piece of land they do not own, in a location far from where they do own land? And why should they deserve this?

Sounds complicated. How does it work in practice?

What guarantee does the landowner in the restricted area have that he/she will eventually be compensated?

Two important definitions

New Jersey Future provides two diagrams that show graphically how all this works (PDF).

*The legal deed to the property is revised so that the right to build a house is removed in perpetuity, even if the entire property is sold.