What is a Transit Overlay District?

How TC-17-20 will support Bus Rapid Transit

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What is the difference between a Transit Overlay District and Transit-Oriented Development? What does TC-17-20 do? How is ETOD different from other zoning in Raleigh? How much more density is allowed in the TOD-R? What is Floor Area Ratio? Is there anything about the TOD-R that I should know? Why should existing neighborhoods allow more housing? How will this impact neighborhoods with a Neighborhood Conservation Overlay District (NCOD)? What guarantee is there that housing built as a result of this text change will be affordable? Will this lower the value of my house? Will this impact the quality of life in my neighborhood? Is parking required in the ETOD or the TOD-R?

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Preparing for Bus Rapid Transit

What is the difference between a Transit Overlay District and Transit-Oriented Development?

City street vie with people walking on the sidewalk with benches and outdoor seating

Transit-oriented development is a general term that describes an active and vibrant area around a transit station. For Raleigh, the type of transit stations we are talking about is for Bus Rapid Transit (BRT). Transit-oriented development refers to the public spaces that make it easy to walk to the transit station. The development pattern should also give people places to rest or shop while they are using the transit system.

A transit overlay district is a special type of zoning that makes it possible for developers and businesses to create transit-oriented development. Zoning is the set of local laws that control the size and location of buildings. Zoning also includes requirements for public benefits like plazas, streets, and sidewalks. By carefully designing transit overlay districts, we can have a new development that brings riders to the transit station.

What does TC-17-20 do?

Two buildings connected by a breezeway

TC-17-20 takes the Transit Overlay District (TOD) that was already in Raleigh’s zoning code and changes it to the Equitable Transit Overlay District (ETOD). The TOD was originally created for the light rail service that was planned in Raleigh years ago. The ETOD is more detailed and focused on the BRT service that is planned now.

The first two BRT routes will be on New Bern Avenue and Western Boulevard. The ETOD is likely to be applied on the property around these corridors that is already zoned for commercial and multi-family development. The ETOD supports the level of density that is needed for BRT to have enough riders. It also makes sure that the public spaces around the transit stations are comfortable for people to walk.

TC-17-20 also creates a new district called the Transit Overlay District-Residential (TOD-R). The TOD-R is designed for the residential neighborhoods near BRT stations. Residents in these neighborhoods will have access to the best transit service in Raleigh. The TOD-R allows a variety of housing so that people of varying incomes can make use of BRT. It also allows for some extra residential density. The extra density is managed by special regulations that ensure that there is space between buildings. New development in TOD-R can support the success of BRT while keeping the feel of the existing neighborhoods.

Duplex Homes

How is ETOD different from other zoning in Raleigh?

A city plaza

The ETOD will allow developers to build taller buildings in return for providing development types that are needed by the community. Zoning in Raleigh sets a maximum height for each zoning district. In the ETOD, a building can be 50% taller than the maximum height if it includes affordable housing units. The number of affordable units would have to be around 12% of the total units in the building. The units have to be affordable for a family making 50% of the area median income (AMI) or less and stay affordable for at least 30 years.  

There is also a height bonus of 30% for buildings that are used completely for employment uses. That usually means office buildings. It could also be an office building with stores on the ground floor. This type of development makes sure there are more jobs near the transit stations and places to shop as people get on and off the bus. These are also business and employment opportunities for residents of existing neighborhoods.

The third major component of the ETOD is that it encourages high-quality plazas, street design, and pedestrian connections. These features create an environment where transit riders have a pleasant experience with less emphasis on personal vehicles.  

Lastly, when the ETOD is applied to a residential zoning district, the zoning standards for RX-3 will apply in that area. The ETOD is not likely to be applied to residential neighborhoods. This provision will most likely apply to large lots directly adjacent to major roads. The RX-3 district allows for greater residential density and a mix of uses while still limiting building height to no more than three stories.

How much more density is allowed in the TOD-R?

Modern Duplex

For detached houses, which are also sometimes called single-family houses, the TOD-R would allow about 50% more housing units per acre for each of the residential zoning districts. For example, a Residential-4 (R-4) area with the TOD-R applied to it would be able to have about six housing units per acre. Normally, the maximum in R-4 is four units per acre 

Some additional density is allowed for attached houses, townhouses, and apartments. An attached house, or duplex, could be built on a lot that is 8,000 square feet in an R-4 district with TOD-R. That is a density of about 11 units per acre. This added density is balanced by setting a maximum Floor Area Ratio (FAR) in the TOD-R. 

What is Floor Area Ratio?

Rendering of Duplexes

Floor Area Ratio (FAR) is the amount of indoor space in a building divided by the area of the lot where it is located. For example, if a house is 2,000 square feet and it sits on a 10,000 square-foot lot, the FAR is 0.2. Detached houses in TOD-R will have a maximum FAR that prevents very large houses from replacing existing smaller houses. Then, the TOD-R limits the FAR for attached, townhouse, and apartment buildings so that they cannot cover much more of the lot than a detached house.  

This also has the effect of reducing the allowed size of each unit when a lot is small. A property owner will have a choice if they decide to redevelop an existing house. Do they want a similarly sized detached house? Or do they want to build a similar-sized building that is allowed to have one or two more units in it? If they choose more units, the units will have to be somewhat small compared to the detached house option. This can help keep housing prices low. 

Is there anything about the TOD-R that I should know?

Residential buildings will be able to have small commercial areas in return for including affordable housing units. For example, suppose someone owns a small apartment with four units. They could offer one of those units at an affordable rent for a family earning 50% of the area median income (AMI). In return for offering that affordable unit, they would be allowed to put a small addition on the apartment building to use as an office or a beauty salon. If they wanted to convert one of the other apartment units to use as the commercial space, they could do that too. The goal of these options is to give property owners opportunities to use existing buildings and stay in their property. Adding a commercial space can provide income for the owner while allowing them to live in the building. That can reduce the need to sell or redevelop the property.

Why should existing neighborhoods allow more housing?

Large duplex

Raleigh is growing. For much of the 20th century, this growth occurred by developing land at the edge of town. Starting in the 21st century, more of Raleigh’s growth shifted to already developed areas, as more people to wanted to live in core neighborhoods and other areas well-served by established amenities and rich in opportunity. Raleigh’s growth policies, adopted in the 2030 Comprehensive Plan, contemplated that growth would primarily occur in mixed-use centers and corridors and that existing neighborhoods would see little change.  

However, the result has been a lack of new family-friendly housing types in these areas, as all the growth has been high-density apartments covering relatively small amounts of land area. At the same time, the neighborhoods near these new developments have become increasingly expensive, pricing single-family housing out of reach for many if not most households. By allowing incremental change over a much wider area, growth can be accommodated with a variety of housing types and in different neighborhood settings, meeting demand for living in these areas at different price points.

How will this impact neighborhoods with a Neighborhood Conservation Overlay District (NCOD)?

The ETOD standards will take the place of the NCOD standards. As mentioned above, there will probably not be many places where the ETOD is applied over an NCOD. The TOD-R rules will not take the place of the NCOD standards if there is a conflict between them.

What guarantee is there that housing built as a result of this text change will be affordable?

Single Duplex

Unless explicitly subsidized and subject to legally-binding affordability restrictions, this new housing will be market-rate—the price or rent will be determined by the willingness of households to pay (most sellers, even those committed to the idea of housing affordability, generally sell to the highest bidder). If demand in an area is very strong, prices will be high even for smaller units in multiple dwellings. Within the same neighborhood, though, townhouses sell for less than single-family, and multi-family condominiums will sell for less than townhouses, as buyers trade-off indoor and outdoor space and privacy for location and access. An example is the Yarborough Park development in Mordecai. Primarily a townhouse development, it also included two single-family lots flanking the entrance. The single-family homes are assessed at over $600,000the townhouses behind, about half of that. 

Further, if households cannot find housing they can afford in their preferred, high-demand neighborhood, they will look for housing in other nearby neighborhoods with lower price points. This will drive up prices in these currently affordable neighborhoods, a process we already see happening south and east of Downtown. Absorbing more demand elsewhere is one way to relieve pressure on currently affordable areas.

Will this lower the value of my house?

Duplex in Austin

This is a common fear, but there is little evidence for it. The closest thing we have to a natural experiment is the existence of missing middle housing in old neighborhoods such as Oakwood, Boylan Heights, Mordecai, and Cameron Park that predate exclusive single-family zoning. These neighborhoods are among the most valuable in the City. The presence of two- to four-unit buildings and townhouses in these neighborhoods does not appear to have suppressed the value of these areas. Yet, as the Yarborough Park example shows, they provide housing options that are more affordable than single-family.

Will this impact the quality of life in my neighborhood?

When people talk about the quality of life, they are sometimes talking about traffic and parking. These are concerns in many parts of Raleigh. People living in the new housing allowed by these overlays will be able to use the BRT system instead of private vehicles. The FAR controls in the TOD-R are designed to help new housing types fit into the existing development pattern. In addition, many residents value housing diversity. Additional households also improve the spending power of the neighborhood, supporting more and better retail and justifying investment in public amenities such as parks and streetscapes.

Is parking required in the ETOD or the TOD-R?

No parking is required for any new development in either of these overlay districts, regardless of the underlying zoning. 

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