Section 1. This Act shall be known as "The Transfer of Development Rights and Special Development District Act".

Section 2. Amend Title 9 of the Delaware Code by inserting therein a new Chapter 32 to read as follows:

“Chapter 32. New Castle County Special Development Districts.

§ 3201. Definitions. In this chapter the following terms shall have the meanings indicated:

(a) ‘Bonds’ or ‘bond’ means a special obligation bond, revenue bond, note, or other similar instrument issued by the County in accordance with this chapter.

(b) ‘County’ or ‘county’ means New Castle County.

(1) Construction, reconstruction, and renovation, and acquisition of all lands, structures, real or personal property, rights, rights-of-way, franchises, easements, and interests acquired or to be acquired by the County for a public purpose;

(2) All machinery and equipment including machinery and equipment needed to expand or enhance County services to the special development districts created pursuant to § 3202 of this title;

(3) Financing charges and interest prior to and during construction, and, if deemed advisable by the County, for a limited period after completion of the construction, interest and reserves for principal and interest, including costs of County bond insurance and any other type of financial guaranty, liquidity support, and costs of issuance;

(4) Extensions, enlargements, additions and improvements;

(5) Architectural, engineering, financial and legal services;

(6) Plans, specifications, studies, surveys and estimates of cost and of revenues;

(7) Administrative expenses necessary or incident to determining to proceed with the infrastructure improvements; and

(8) Other expenses authorized or incident to the construction, acquisition, financing and operation of the infrastructure improvements, including administrative expenses charged to collect and/or administer the tax revenues.

§ 3202. Special taxes authorized; purpose; requirements and restrictions.

(a) The authority granted to the County under this Chapter is enabled by, and must be used consistently with, the provisions of Title 29, Chapter 91, Subchapter IV of the Delaware Code, which requires that transfer of development rights credits be utilized in order for a county government to take advantage of Special Development Districts. Subject to the provisions of this Section, and for the purpose stated in subsection (b) of this Section, the County may:

(1) create a special development district;

(2) levy ad valorem or special taxes; and

(3) issue bonds and other obligations.

(b) The purpose of the authority granted under subsection (a) of this Section is to provide financing, refinancing, or reimbursement for (1) the cost of the design, construction, establishment, extension, alteration, maintenance, or acquisition of adequate storm drainage systems, sewers, water systems, roads, bridges, culverts, tunnels, streets, traffic signals, signage, sidewalks, lighting, parking, parks and recreation facilities, open space, farm land preservation, fire protection facilities, public safety facilities, paramedic facilities, libraries, schools, transit facilities, solid waste facilities, identifying monuments, landscaping of entrances and medians, and other improvements, including infrastructure improvements as authorized, whether situated within the special development district or outside the special development district if the improvements, including infrastructure improvements provide service or benefit to the property within the special development district, for the development and utilization of the land, each with respect to any defined geographic region within the County.

§ 3203. Issuance and sale of bonds; Section self-executing.

In addition to other powers the County may have, and notwithstanding the provisions of any other public local law, or public general law, the County may borrow money by issuing and selling bonds for the purposes stated in § 3202(b) of this Title, if a request to the County is made by the owners of at least two-thirds of the assessed valuation of the real property located within the special development district.

This Section is self-executing and does not require the County to enact legislation to exercise the powers granted under this Section.

§ 3204. Bonds payable from special fund; complementary powers of governing body; proceeds.

(a) Bonds shall be payable from the special fund required under § 3205 of this Title.

(b) If the governing body of the County issues bonds under this chapter, the governing body may also:

(1) establish sinking funds;

(2) establish debt service reserve funds;

(3) pledge other assets and revenues towards the payments of the principal, premium, if any, and interest; or provide for bond insurance or any other type of credit enhancement or liquidity support of the bonds.

(1) costs of design, construction, establishment, extension, alteration, or acquisition of improvements, including infrastructure improvements;

(2) costs of issuing bonds;

(3) payment of the principal and interest on loans, development loans, money advances, or any indebtedness for any of the purposes stated in §3202(b) of this title, including the refunding of bonds previously issued under this chapter;

(4) funding of a debt service reserve fund or payment of interest prior to, during, or for a limited period of time after construction; and

(5) purposes described in § 3202(b) of this Title.

§ 3205. Actions necessary before issuing bonds.

(a) Before issuing bonds pursuant to this Chapter, the governing body of the county shall:

(1) Designate by resolution an area or areas as a special development district;

(2) Subject to subsection (b) of this Section, adopt a resolution creating a special fund with respect to the special development district; and

(3) Provide for the levy of an ad valorem or special tax on all real property within the special development district at a rate or amount designed to provide adequate revenues to pay the principal of, interest on, and redemption premium, if any, on the bonds, to replenish any debt service reserve fund, and for any other purpose related to the ongoing expenses of or security, including debt service coverage requirements, for the bonds. Ad valorem taxes shall be levied in the same manner, upon the same assessments, for the same period or periods, and as of the same date or dates of finality as are now or may hereafter be prescribed for general ad valorem real property tax purposes within the district, and shall be discontinued when all of the bonds have been paid in full. Special taxes shall be levied pursuant to § 3213 of this Title.

(b) The resolution creating a special fund under subsection (a)(2) of this Section shall:

(1) Pledge to the special fund the proceeds of the ad valorem or special tax to be levied as provided under subsection (a)(3) of this Section and shall specify the priority of application with other ad valorem or special taxes; and

(2) Require that the proceeds from the tax be paid into the special fund.

§ 3206. When no bonds outstanding.

(a) When no bonds are outstanding with respect to a special development district:

(1) The special development district shall be terminated; and

(2) Any moneys remaining in the special fund on the date of termination of the special development district shall be paid to the general fund of the County.

§ 3207. Adoption of ordinance to implement authority.

(a) In order to implement the authority conferred upon it by this chapter to issue bonds, the governing body of the County shall adopt an ordinance that:

(1) Specifies and describes the proposed undertaking and states that it has complied with § 3205 of this Title;

(2) Specifies the maximum principal amount of bonds to be issued;

(3) Specifies the maximum rate or rates of interest for the bonds; and

(4) Agrees to a covenant to levy upon all real property within the special development district, ad valorem taxes or special taxes in rate and amount at least sufficient in each year in which any of the bonds are outstanding to provide for the payment of the principal of, premium, if any, and the interest on the bonds.

(b) The ordinance may specify or may authorize its finance board or department or other appropriate financial officer, by resolution or ordinance, or its chief executive officer, by executive order, to specify any of the following as it deems appropriate to effect the financing of the proposed undertaking;

(1) The actual principal amount of the bonds to be issued;

(2) The actual rate or rates of interest for the bonds;

(3) The manner in which and the terms upon which the bonds are to be sold;

(4) The manner in which and the times and places that the interest on the bonds is to be paid;

(5) The time or times that the bonds may be executed, issued and delivered;

(6) The form and tenor of the bonds and the denominations in which the bonds may be issued;

(7) The manner in which and the times and places that the principal of the bonds is to be paid, within the limitations set forth in this Section;

(8) Provisions pursuant to which any or all of the bonds may be called for redemption prior to their stated maturity dates; or

(9) Any other provisions not inconsistent with this Section as shall be determined by the governing body of the county to be necessary or desirable to effect the financing of the proposed undertaking.

(c) An ordinance authorizing the bonds provided for under this chapter, an ordinance, resolution, or executive order passed or adopted in furtherance of the required ordinance, the bonds, the designation of a special development district, or the levy of a special ad valorem tax or special tax may not be subject to any referendum by reason of any other State or local law.

(d) The ordinance authorizing the bonds required under this chapter, any ordinance, resolution, or executive order passed or adopted in furtherance of the required ordinance, the bonds, the designation of a special development district, or the levy of a special ad valorem tax or special tax shall be subject to the request of the landowners as specified under § 3203 of this Title.

§ 3208. Taxation of bonds.

The principal amount of the bonds, the interest payable on the bonds, their transfer and any income derived from the transfer, including any profit made in the sale or transfer of the bonds, shall be exempt from taxation by the State and by the Counties and Municipalities of the State.

§ 3209. Bond form; signatures; maturity; manner of sale.

(a) All bonds shall be in fully registered form. Each of the bonds shall be deemed to be a security as defined in § 8-102 of Title 6, whether or not it is either one of a class or series or by its terms is divisible into a class or series of instruments.

(b) All bonds shall be signed manually or in facsimile by the chief executive officer of the County, and the seal of the County shall be affixed to the bonds and attested by the clerk or other similar administrative officer of the county. If any officer whose signature or countersignature appears on the bonds ceases to be such officer before delivery of the bonds, the officer’s signature or countersignature shall nevertheless be valid and sufficient for all purposes the same as if the officer had remained in office until delivery.

(d) All bonds shall be sold in the manner, either at public or private sale, and upon the terms, as the governing body of the county deems best. Any contract for the acquisition of property may provide that payment shall be made in bonds.

§ 3210. Bonds issued are securities.

Bonds issued under this chapter are securities in which all public officers and public bodies of the State and its political subdivisions, all insurance companies, State banks and trust companies, national banking associations, savings banks, savings and loan associations, investment companies, executors, administrators, trustees and other fiduciaries may properly and legally invest funds, including capital in their control or belonging to them.

§ 3211. Powers granted are supplemental to other laws.

The powers granted under this chapter shall be regarded as supplemental and additional to powers conferred by other laws, and may not be regarded as in derogation of any powers now existing.

§ 3212. Construction of Chapter.

This chapter, being necessary for the welfare of the State and its residents, shall be liberally construed to effect the purpose stated in § 3202(b) of this Title.

§ 3213. Special taxes on real property as alternative to ad valorem taxes.

(a) As an alternative to levying ad valorem taxes under this chapter the governing body of the county may levy special taxes on real property in a special development district to cover the cost of infrastructure improvements. In determining the basis for and amount of the tax, the cost of an improvement may be calculated and levied:

(1) Equally per front foot, lot, parcel, dwelling unit, or square foot;

(2) According to the value of the property as determined by the governing body, with or without regard to improvements on the property; or

(3) In any other reasonable manner that results in fairly allocating the cost of the infrastructure improvements.

(b) The governing body of the county may provide by ordinance or resolution for:

(1) A maximum amount to be assessed with respect to any parcel of real property located within a special development district;

(2) A tax year or other date after which no further special taxes under this Section shall be levied or collected on a parcel; and

(3) The circumstances under which the special tax levied against any parcel may be increased, if at all, as a consequence of delinquency or default by the owner of that parcel or any other parcel within the special development district.

(c) The governing body by ordinance or resolution may establish procedures allowing for the prepayment of special taxes under this Section.

(d) Special taxes levied under this Section shall be collected and secured in the same manner as general ad valorem real property taxes unless otherwise provided in the ordinance or resolution and shall be subject to the same penalties and the same procedure, sale, and lien priority in case of delinquency as is provided for general ad valorem real property taxes.

§ 3214. Bonds not to constitute general obligation debt.

Bonds issued under this Chapter are a special obligation of the County or Special Development District and may not constitute a general obligation debt of the county, or a pledge of the county’s full faith and credit or taxing power.

§3215. Special Development District Consistency with Certified Comprehensive Plan.

The use of lands in a Special Development District shall be consistent with the Comprehensive Plan for the area as certified pursuant to 29 Del.C. §9103(f).”.

Section 3. Amend § 1801(4), Chapter 18, Title 22 of the Delaware Code by deleting § 1801(4) in its entirety and substituting in lieu thereof a new § 1801(4) to read as follows:

“(4) ‘Municipality’ or ‘municipality’ means: 1) Any incorporated municipality in New Castle County that is creating a Special Development District in compliance with the requirements of Title 29, Chapter 91, Subchapter IV of the Delaware Code; 2) any municipality that has a charter which enables the use of Special Development Districts as of July 1, 2007; or 3) any other town or city located in the State of Delaware with a population in excess of 50,000 people.”.

Section 6. Amend §1802(b), Chapter 18 of Title 22 of the Delaware Code by deleting §1802(b) in its entirety and replacing it with a new §1802(b) to read as follows:

“(b) The purpose of the authority granted under subsection (a) of this Section is to provide financing, refinancing, or reimbursement for the cost of the design, construction, establishment, extension, alteration, maintenance, or acquisition of adequate storm drainage systems, sewers, water systems, roads, bridges, culverts, tunnels, streets, traffic signals, signage, sidewalks, lighting, parking, parks and recreation facilities, open space, farm land preservation, fire protection facilities, public safety facilities, paramedic facilities, libraries, schools, transit facilities, solid waste facilities, identifying monuments, landscaping of entrances and medians, and other improvements, including infrastructure improvements as authorized, whether situated within the special development district or outside the special development district if the improvements, including infrastructure improvements provide service or benefit to the property within the special development district, for the development and utilization of the land, each with respect to any defined geographic region within the municipality.”.

Section 4. Amend Chapter 91, Title 29 of the Delaware Code to provide for a new Subchapter III to read as follows:

“Subchapter III. Transfer of Development Rights and Banking Program

§9131. Findings and Purposes.

The General Assembly finds that a critical need exists to provide for orderly growth that maintains a desirable quality of life, to encourage well-designed and efficient communities rather than inefficient sprawl, to preserve farmland, cultural and historic lands, and other sensitive lands identified by State and local governments, and to assist in the creation and maintenance of a market for the sale and purchase of development rights. The adoption of a transfer of development rights and banking program is a means of achieving those objectives. It is the purpose of this subchapter to establish the framework, guidelines and incentives for the adoption of transfer of developments rights programs by New Castle County and Municipalities that serve to direct growth and development to areas having adequate infrastructure to accommodate such growth and development, while providing permanent protection to valuable agricultural lands, open space, cultural and historic lands, and critical and sensitive areas. Furthermore, the purpose of this subchapter is to develop financial mechanisms that will enable New Castle County and local governments to finance necessary improvements in receiving areas to provide services and infrastructure to support the quality of life for Delaware residents.

§9132. Definitions.

For purpose of this subchapter the following definitions shall apply:

(a) 'Bank' shall mean the depository for TDR Units, which are purchased or received by the Board.

(b) 'Board' shall mean the TDR Banking Board established by each County under this subchapter.

(c) ‘Special Development District' or 'SDD' or 'District' means one or more parcel(s) of land so designated by a Local Government pursuant to the provisions of this chapter. Parcels of land in a District need not be contiguous, but they must all be located within the same local government.

(d) 'County' and ‘Counties’ shall mean only New Castle County.

(e) 'Delaware Agricultural Lands Preservation Program' shall mean the program established and operated by the Foundation pursuant to the provisions of Chapter 9, Title 3 of the Delaware Code.

(f) 'Development Unit' shall mean a residential dwelling unit or defined equivalent for nonresidential uses.

(g) 'Foundation' shall mean the Delaware Agricultural Lands Preservation Foundation.

(h) 'Guideline' shall mean the substantive provisions adopted by a Board, Foundation or Non-profit after consultation with a County and Municipalities within such County and after public hearings to be used by Municipalities and Counties in:

(1) developing the criteria for determining and utilizing TDR Units; and

(2) adopting provisions for operation of a TDR Program subject to this subchapter.

(i) 'Municipality' shall mean a municipal government established by the State of Delaware and having defined geographic boundaries completely within New Castle County.

(j) ‘Non-Residential Use’ shall mean a commercial, industrial, or other developed land use that does not involve the construction of residences for human habitation and not waived under the provisions of §9133(a)(8) of this Title.

(k) 'Preservation District' shall mean an agricultural preservation district as referenced in Subchapter II, Chapter 9, Title 3 of the Delaware Code.

(l) 'Preservation Easement' shall mean an easement as defined in 3 Del. C. §902(15).

(m) 'Receiving Parcel' shall mean the parcel of land that is subject to the transfer of TDR Units, and for which the owner of the parcel is entitled to an increase in development density.

(n) 'Sending Parcel' shall mean the parcel of land from which TDR Units are obtained and use restrictions are imposed.

(o) 'TDR' shall mean transfer of development rights.

(p) 'TDR Unit' shall mean a residential development unit or equivalent in accordance with the local government’s TDR program, which is acquired from the Bank or from a private property owner and utilized by the owner of the Receiving Parcel to increase development density. A TDR unit shall equal one residential unit. The county TDR program, as enabled by this chapter, shall determine the conversion value of a TDR unit that is to be used for non-residential density transfers, which shall be between 3,000 to 6,000 square feet of building space per acre of restricted land.

(q) ‘Vacant or Undeveloped Land’ shall mean lands that are currently open, fallow, in agricultural use, or otherwise not fully utilized for residential, commercial or other urban land uses.

§9133. County and Municipal Authorization.

(a) Notwithstanding any provision of the law to the contrary, New Castle County, and each Municipality prior to any annexation action, shall adopt as part of its Comprehensive Development Plan and subsequent land use ordinances developed pursuant to the requirements of Titles 9 or 22, and certified pursuant to Chapter 91, Title 29 of the Delaware Code, a TDR program which at a minimum.

(1) Establishes the criteria for determining the number of TDR Units available on each Sending Parcel or part thereof, so that the available number of TDR Units for a parcel can be readily calculated.

(2) The number of TDR Units available from a parcel shall be determined through the county TDR program.

(3) No action taken by the County or Municipality shall result in an effective downzoning as a result of activities related to the TDR program.

(4) Any land parcel(s) annexed into a municipality which is vacant or undeveloped and larger than ten acres and/or five lots shall become a receiving parcel(s). Parcels shall be annexed at existing county residential density. Projects that are intended to be primarily non-residential in nature may be placed into an appropriate non-residential zoning district upon annexation.

(5) Any parcel(s) which are part of a certified municipal annexation area, if developed by a county, shall become receiving parcel(s).

(6) The transfer of TDR Units to parcels in areas designated by the Office of State Planning Coordination as Investment Level 4 shall not be permitted unless the area becomes a designated growth area pursuant to a certified local government comprehensive plan.

(7) As part of each receiving parcel(s), a property owner or owners must purchase or otherwise obtain TDRs so that overall density of the receiving parcel(s) shall increases over the base gross density by at least 2 residential units per acre and shall be at least 4 residential units per acre for the residential portion of the receiving parcel(s). The property owner or owners must purchase or otherwise obtain TDRs so that at least two TDR units are utilized per acre for any non-residential portion of the receiving parcel(s). TDRs may be obtained through Subchapter III hereof, or by private purchase, provided that if by private purchase, the property transferring development rights is restricted by preservation easement duly recorded in the appropriate Recorder of Deeds Office in accordance with the applicable rules and regulations of the local government in which the receiving parcel(s) are located. The restricted property need not be in the same jurisdiction as the receiving parcel(s).

(8) Lands in municipal annexation areas or designated as receiving parcel(s) in county jurisdictions are exempt from the requirement to utilize TDRs if the use of the property is to be open space; recreational facilities; state, county or municipal buildings or facilities; utility facilities or structures (including substations); schools; hospitals; and/or related public or private facilities essential to the public health, safety and welfare of the community.

(b) Any TDR program which is adopted by New Castle County or a Municipality as part of a Comprehensive Development Plan and subsequent land-use ordinance pursuant to the Land Use Planning Act, Chapter 92, Title 29 of the Delaware Code, shall be subject to review for consistency with the Guidelines under the provisions of Subchapter I, Chapter 91, Title 29 of the Delaware Code.

(c) The use of TDR Units on any Receiving Parcel shall be subject to compliance with all other applicable federal, state and local requirements, provided however, that no separate or conditional or discretionary approval shall be required with respect to the application of TDR Units in accordance with a TDR program.

(d) In special circumstances a waiver from the requirements of §9133 (a) (7) of this Title for a particular project or parcel may be granted by the Cabinet Committee on State Planning Issues and the legislative body of the local government. In the case of parcels proposed for annexation, the local government shall be that of the municipality that is considering the annexation request. These circumstances may include, but are not limited to, projects which will provide an extraordinary benefit to the State and the local jurisdiction through economic development, job creation, educational opportunities, public services or facilities, agricultural preservation or protection and enhancement of the natural environment. In order to grant such a waiver, a simple majority of both the Cabinet Committee on State Planning Issues and the legislative body of the local government must vote affirmatively for the requested waiver. Upon granting such a waiver, both the Cabinet Committee and the local legislative body shall provide the applicant a written notice which shall include an explanation of the findings and reasoning which led to the approval of the waiver.

(e) Notwithstanding any language to the contrary, receiving parcels shall not be required to maintain greater than 10 percent of total area as open space.

§9134. Private TDR Transactions.

(a) Nothing in this Title shall be construed to prohibit the private sale of Transfer of Development Rights credits between willing buyers and willing sellers. Private TDR transactions are not required to utilize any TDR banking program established under this Title.

(b) All private transactions shall adhere to requirements of the relevant local government’s TDR program and ordinances.

(c) TDR credits purchased from a private property owner may not be resold or sold to other third parties, but TDR credits may be sold or resold to the bank at a price not to exceed the original purchase price.

§9135. TDR Banking Board.

(a) Each County may establish a TDR Bank and a TDR Banking Board. In lieu of establishing a TDR Banking Board, a County may authorize the Foundation or other non-profit entity to administer the TDR program in accordance with §9139 of this Title.

(b) Should a County establish a Board, the Board shall have at least 7 but no more than 9 members, and shall include at least one member or representative as follows:

(1) A representative from the Office of State Planning Coordination shall serve as an ex-officio member, to be selected by the Governor;

(2) An active, full-time farmer land-owner nominated by the County Farm Bureau;

(3) A representative of the home building industry, to be nominated by the Delaware Homebuilders Association from the county establishing the Board;

(4) A representative of the Delaware League of Local Governments, to be selected by the Delaware League of Local Governments from the county establishing the Board; and

(5) A representative from the Delaware Agricultural Lands Preservation Foundation, to be selected by the Secretary of Agriculture.

(1) To adopt procedural rules to conduct its affairs and carry out and discharge its powers, duties, functions, and select a chairperson.

A simple majority of the Board shall be required for all actions by the Board. Two-thirds of the total members of the entire Board shall constitute a quorum.

(2) To adopt substantive rules and regulations, after public hearing to carry out and discharge its powers, duties and functions.

A simple majority of the Board shall be required for all actions by the Board.

(3) To enter into agreements for consultant, appraisal, legal, accounting, audit and other services deemed advisable or necessary in the exercise of its purposes and powers and upon such terms as it deems appropriate, subject to available funding.

(4)To establish the criteria for the purchase and sale of TDR Units, which may include transactions that do not involve the TDR Bank.

(5) To purchase or receive, by gift or otherwise, and retain if desired, TDR Units under such terms and conditions deemed appropriate.

(6) To sell TDR Units under such terms and conditions as deemed appropriate.

(7) To develop and utilize documents as desirable or necessary to engage in TDR transactions.

(8) To enter into agreements with Counties and Municipalities, State agencies, Authorities, Foundations and instrumentalities of the State and adopt guidelines for participation and operation of the TDR program.

(9) To receive, deposit, withdraw and expend monies from dedicated State accounts for the purpose of engaging in and completing TDR transactions, including the payment of transaction costs related thereto.

(10) To establish use restrictions on Sending Parcels as deemed desirable and necessary, which restrictions shall not, at a minimum, prohibit any agricultural uses, including but not limited to crops or the breeding and boarding of horses.

(11) To do all acts and things reasonable and necessary or convenient to carry out its functions and operations of the TDR and Bank program.

(d) Each Board shall act in accordance with adopted local land use plans and ordinances.

(e) The members of a Board shall receive no compensation from the Bank but may be reimbursed for travel, out of pocket expenses, and other expenses related to the performance of duties as Board members at the established federal rates.

(f) Term lengths for members of a Board shall be established by each County, but no term shall be more than three years and no Board member shall serve for more than six consecutive years.

§9136. Reports.

Each Board shall make an annual report to the Governor, the General Assembly, and local jurisdiction setting forth its operations and transactions, and may make such other additional reports from time to time as it desires.

§9137. Tax Status.

(a) The powers and functions exercised by a Board are and will be in all respects for the benefit of the people of the State. A Board will exercise essential governmental functions. To this end no Board shall be required to pay any taxes on assessments or charges of any character, including, without limitation, real property taxes, real estate transfer taxes, taxes on any of its property used, leased or exchanged, or any income or revenue derived from its activities, including, without any limitation, any profit from any sale or exchange of TDR Units. Nothing in this Section shall be construed to mean that a tax parcel resulting from a TDR unit, once recorded, is exempt from taxes.

(b) There shall be no real estate transfer tax levied on the purchase, transfer, exchange or sale of any TDR Unit.

(c) Land subject to a preservation easement shall be taxed according to the farmland assessment provisions codified in 9 Del. C. §8335, or its successor.

(d) There shall be no recording fee or cost charged for the recording of documents relating to the transfer of TDR units from Sending Parcels.

(e) The Tax Assessment Office, the Planning and Zoning Offices and the Recorder of Deeds office for each County shall cooperate and assist each Board and the Foundation in effectuating the provisions of this subchapter.

§9138. TDR Bank.

(a) Except for private, property owner to property owner transactions, all TDR Units acquired by purchase, transfer, donation or otherwise shall be held in the TDR Bank for sale and use in TDR programs adopted by Counties and Municipalities under this subchapter.

(b) The proceeds from the sale of TDR Units shall be used to purchase TDR Units and pay for the transaction costs related thereto.

(d) TDR Units shall be sold on a 'first come/first serve' basis. At the time of purchase, the purchaser shall designate by right the Receiving Parcel or Receiving Parcels for which the TDR Units are intended. Unused TDR Units purchased from a Bank may not be resold or sold to other third parties or transferred to other TDR parcels not identified at the time of the original purchase. Unused TDR Units purchased from a Bank may be resold back to a Bank at their original purchase price. The Bank shall be required to repurchase the same. This Section shall not be construed to allow the property owner to purchase the development rights back at the original price.

§9139. Administration of Voluntary TDR Program and Banking System

(a) The administration of the TDR bank and voluntary program may be conducted in lieu of a Board: (i) by the Foundation under the terms and conditions of a Memorandum of Agreement between the County and the Foundation; or (ii) by another non-profit entity selected by a County, under the terms and conditions of a Memorandum of Agreement between the County and such entity and provided such entity is approved by the Office of State Planning. In the event a non-profit entity administers the TDR bank, the portion of the meetings of the board of directors or other governing body of such entity dealing with the TDR program shall be open to the public as if the entity were subject to Chapter 100 of this Title.

(b) The Foundation, Board or other authorized non-profit entity as the case may be shall be authorized and responsible for monitoring compliance and enforcing use restrictions imposed on Sending Parcels.

(1) The Foundation, Board or other authorized non-profit entity shall be entitled to take action in any court of competent jurisdiction to enforce any restrictions or requirements imposed under this chapter, duly adopted regulations and binding legal instruments. In any such action the Foundation, Board or authorized non-profit entity shall, if it prevails, be entitled to recover its reasonable costs and expenses, including reasonable attorney's fees.

(2) The Foundation, Board or authorized non-profit entity shall also be entitled to recover in any such action all tax benefits conferred under this chapter, plus one and one-half percent per month of tax benefit amounts computed on a compound basis from the date the tax benefit was first realized to the date of judgment.

(3) Any person who violates the requirements imposed by this chapter shall after notification and failure to correct the violation, be subject to a civil penalty of not less than $50 but not more than $200 for each completed violation. If the violation continues for a number of days, each day of such violation shall be considered a separate violation. Unless joined to an action under subsection (1) of this Section, a civil penalty claim hereunder shall be filed in any Court of Common Pleas. Any civil penalties recovered shall be paid to the Foundation, Board or authorized non-profit entity.

(c) The sale and purchase of TDR Units shall be on a voluntary basis, and the Foundation, Board or other authorized non-profit entity shall not be required to purchase TDR Units from eligible landowners. Eligible landowners shall not be required to sell TDR Units to the Board, or to the Foundation or other authorized non-profit entity acting on behalf of the County.

(d) A Board may join with the Foundation and/or the Open Space Council in the funding of purchases of both TDR units under this Subchapter, and Preservation Easements under the Foundation's purchase program.

(e) In the event that a property on which a TDR preservation easement exists is incorporated in a designated growth zone in a certified county or municipal comprehensive plan, or is designated as Investment Level 1, 2 or 3 as part of a future update of the Strategies for State Policies and Spending, the property owner may petition the board, foundation or non-profit entity to re-purchase their development rights. The bank shall be obligated to sell the development rights back to the property owner at the market value of the TDRs on the date of repurchase. This Section shall not be construed to allow the property owner to purchase the development rights back at the original price.

§9140. Additional Benefits.

Municipalities and Counties with TDR programs certified pursuant to 29 Del. C. §9103(f) shall be entitled to seek priorities in participation in available State grant and funding programs, including programs which provide local assistance for infrastructure improvements.

§9141. Saving.

(a) Transfer of development rights programs adopted by Municipalities and Counties and existing at the time of enactment of this subchapter shall remain in force and effect until modified or abolished, and any transaction, determination or approval which has occurred or which may occur in the future involving an existing transfer of developments rights program shall not be affected by this subchapter.

(b) The provisions of this subchapter and any TDR program adopted by a County or Municipality shall have no effect on the right of such property owner to develop the property consistent with relevant codes and ordinances governing land use and development.

(c) any provision of this subchapter or the application thereof to any person or circumstance if held invalid, such invalidity shall not affect other provisions or applications of the subchapter which can be given effect without the invalid provision or application, and, to that end, the provisions of this subchapter are declared to be severable.".

Section 5. Amend Chapter 91, Title 29 of the Delaware Code to provide for a new Subchapter IV to read as follows:

“Subchapter IV. Special Development Districts

§9150. Findings and Purposes.

The General Assembly finds that in order to better coordinate development, encourage well-designed and efficient communities rather than inefficient sprawl, and to better provide for infrastructure needed for development, a better mechanism needs to be created for the coordination between the state, local governments, and local property owners. Special Development Districts are hereby authorized pursuant to the terms and conditions of this chapter.

§9151. Definitions.

For purpose of this subchapter the following definitions shall apply:

(a) 'Bonds' or 'bond' means a special obligation bond, revenue bond, note or other similar instrument issued by any county or municipality in accordance with this subchapter.

(b) ‘Special Development District' or 'SDD' or 'District' means a parcel or parcels of land so designated by a Local Government pursuant to the provisions of this chapter. Parcels of land in a District need not be contiguous, but they must all be located within the same Local Government.

(1) Construction, reconstruction and renovation, and acquisition of all lands, structures, real or personal property, rights, rights-of-way, franchises, easements and interests acquired or to be acquired by a municipality for a public purpose;

(2) All machinery and equipment including machinery and equipment needed to expand or enhance municipal services to the Special Development Districts created pursuant to § 9152 of this Title;

(3) Financing charges and interest prior to and during construction, and, if deemed advisable by the municipality, for a limited period after completion of the construction, interest and reserves for principal and interest, including costs of municipal bond insurance and any other type of financial guaranty, liquidity support and costs of issuance;

(4) Extensions, enlargements, additions and improvements;

(5) Architectural, engineering, financial and legal services;

(6) Plans, specifications, studies, surveys and estimates of cost and of revenues;

(7) Administrative expenses necessary or incident to determining to proceed with the infrastructure improvements; and

(8) Other expenses as may be necessary or incident to the construction, acquisition, financing and operation of the infrastructure improvements including administrative expenses charged to collect and/or administer the tax revenues.

(d) 'County', 'county' or ‘Counties’ means New Castle County only.

(e) 'Investment Level' means a designation by the Office of State Planning Coordination regarding planned infrastructure and state investment in the area so designated and ranging from level 1 through level 4.

(f) 'Local Government' means New Castle County or a Municipality in New Castle County.

(g) ‘Special Development District Master Plan’ or ‘SDDMP’ or ‘Master Plan’ means a document and maps prepared to guide the implementation of a Special Development District. The purpose of the SDDMP is to define infrastructure needs for the SDD area (including, but not limited to: sewer; water; transportation; and stormwater management) as well as to define financing mechanisms and the percentage of contributions required from each parcel participating in the SDD. The SDDMP shall consider land use and the cumulative impacts and infrastructure needs of existing and planned development in the area in order to define the maximum permissible development potential and the resulting infrastructure requirements for all parcels participating in the SDD.

(h) 'Municipality' means any town or city located within New Castle County.

(i) ‘TDR' shall mean transfer of development rights.

(j) 'TDR Unit' shall mean a residential development unit or equivalent in accordance with the local government’s TDR program, which is acquired from the Bank or from a private property owner and utilized by the owner of the Receiving Parcel to increase development density. A TDR unit shall equal one residential unit. The county TDR program, as enabled by this chapter, shall determine the conversion value of a TDR unit that is to be used for non-residential density transfers, which shall be between 3,000 to 6,000 square feet of building space per acre of restricted land.

§9152. Creation of Special Development Districts.

A Special Development District may be created by ordinance of a Local Government in (1) any growth zone in New Castle County or Municipal comprehensive plan that has been certified in accordance with Chapter 91, Title 29 of the Delaware Code; or (2) any parcel(s) in a county or municipality as consistent with the certified comprehensive plan and the Strategies for State Policies and Spending.

§9153. Base Density and TDRs.

(a) Notwithstanding any other regulation or restriction of a Local Government, all Special Development Districts shall have a base gross density (calculated based upon the total acreage of the site) as follows:

(1) As part of the Special Development District, the base density shall be the existing county residential density, regardless of whether the parcel remains in the county jurisdiction or is annexed into a municipality. Projects that are intended to be primarily non-residential in nature may be placed into an appropriate non-residential zoning district.

(2) As part of each Special Development District, a property owner or owners must purchase or otherwise obtain TDRs so that overall density of property in the District shall increases over the base gross density by at least 2 residential units per acre and shall be at least 4 residential units per acre for the residential portion of the SDD. The property owner or owners must purchase or otherwise obtain TDRs so that at least two TDR units are utilized per acre for any non-residential portion of the receiving parcel(s). TDRs may be obtained through subchapter III hereof, or by private purchase, provided that if by private purchase, the property transferring development rights is restricted by preservation easement duly recorded in the appropriate Recorder of Deeds Office in accordance with the applicable rules and regulations of the Local Government in which the SDD is located. The restricted property need not be in the same jurisdiction as the SDD.

(b) A Special Development District shall include both residential and non-residential uses.

§9154. Infrastructure Master Plan for Special Development Districts.

Property in a Special Development District shall be developed in accordance with a Master Plan adopted by the Local Government at the time of the creation of the SDD. The Master Plan shall set forth the maximum permitted development for each parcel in the SDD and, based upon such development, the amount of infrastructure resources and/or improvements (sewer, highway and road capacity, water, and other utilities) needed for the development of such SDD. The Master Plan shall also set forth the percentage contribution each parcel owner is to pay towards the cost of the infrastructure resources and improvements. To the extent infrastructure improvements will alleviate existing shortfalls or provide excess capacity beyond that required by the parcels making up the SDD, the cost of such alleviation or excess capacity shall be paid by the Local Government (in the case of services provided by the Local Government such as sewer) or by the Delaware Department of Transportation (in the case of road and highway improvements). The Master Plan shall be required to address existing infrastructure shortfalls but the SDD shall only be required to fund additional infrastructure necessary for the planned development of the District. The Master Plan shall allow for multi-jurisdictional funding of infrastructure through the use of memoranda of agreements. The Infrastructure Master Plan shall be required to be reviewed through the pre-application review process described in Chapter 92, Title 29 of the Delaware Code.

§9155. Infrastructure Development Agreements and Special Development Districts.

(a) The cost of the infrastructure improvements called for in the Master Plan for a Special Development District may be paid for in one of two ways:

(1) pursuant to a private agreement (such as multi-jurisdictional memoranda of agreements) entered into between all of the property owners and the Local Government(s) and, to the extent road or highway improvements to any roads which are the responsibility of the Department of Transportation; or,

(2) For purposes of this subchapter and the creation of SDDs, any Local Government is hereby authorized to develop financial mechanisms for infrastructure funding as described in Title 9, Chapters 32, 54, or 71 or in Title 22, Chapter 18.

(b) At the time of creation of the Special Development District by the Local Government, each property owner in the District shall sign an agreement (the "Infrastructure Development Agreement") with the Local Government. The Infrastructure Development Agreement shall set forth the infrastructure required by the Master Plan (if known) or the process by which the infrastructure needs will be determined. It shall also set forth the manner of payment for such infrastructure. Where the financing option set forth in subsection (a)(l) above is to be used, the Infrastructure Development Agreement shall also set forth the timing and method for payments required for the infrastructure to be built. Where a Special Development District is to be used, the Infrastructure Development Agreement shall so state and the requirements of 22 Del. C. §1803(a)(2) are deemed waived. The agreement (or a memorandum thereof) shall be recorded with the appropriate Recorder of Deeds and shall bind future property owners.

(c) As part of the Infrastructure Development Agreement, a property owner or property owners may agree to construct all or a portion of the infrastructure called for under the Master Plan, and shall receive a credit against payments for infrastructure, the terms and conditions thereof to be set forth in the agreement.

§9156. Land Use Approval Process in a Special Development District.

Notwithstanding the requirements of a Local Government which might otherwise be applicable, no proposed development for a parcel in a Special Development District which does not exceed the development permitted for such parcel in the Master Plan shall

(i) be subject to pre-application review process under Chapter 92, Title 29 of the Delaware Code;

(ii) be required to prepare or submit a traffic impact study; and

(iii) be subject to any limitations on the amount of development otherwise applicable to the proposed development due to limited amounts of infrastructure or utility capacity. Development within a SDD may be phased.

§9157. Conflict with Existing Charters.

To the extent a municipal charter is in conflict with the provisions of Subchapter IV of this Chapter as of July 1, 2007, the municipal charter shall be controlling as applied to that particular municipality. This subchapter as applied to all other municipalities shall remain in effect and shall be applicable to all projects initiated after July 1, 2007.”.

Section 6. Amend §2653(a)(3), Chapter 26, Title 9 of the Delaware Code by deleting the following from the second sentence therein: “;provided in the case of New Castle County, that such receiving districts, zones or areas are within the same planning district as defined by the county.”