The Highlands Council established the Highlands Development Credit (HDC) Bank by resolution on June 26, 2008. The HDC Bank is lead by a nine-member board of directors and is chaired by Highlands Council member Scott Whitenack. The HDC Bank works in conjunction with the Highlands Council to implement the Highlands TDR Program.

Under the provisions of the Regional Master Plan, the HDC Bank performs several functions, including recording and tracking all HDC activities, and serving as a buyer and seller of HDCs.

HDC Certificate Process

While the Highlands Council is responsible for determining the number of HDCs that a property is entitled to receive under the TDR program, the Bank issues HDC Certificates which entitle a property owner to sell, convey or otherwise transfer any HDCs that have been allocated to their property. Through the certificate process, the HDC Bank certifies the number of HDCs allocated to a property, confirms that the owner has marketable title to the property, and ensures that a deed of easement is recorded against a property for its protection in perpetuity. An application for an HDC Certificate will be posted on the Bank’s website shortly.

Initial Purchase Program

A critical role for the HDC Bank will be the purchase of HDCs from property owners that face hardship circumstances. Because all receiving zones under the Highlands program are voluntary, it will take time for the Highlands Council working with municipalities throughout the seven Highlands counties to plan for and designate these zones. The Bank will serve as the primary purchaser of HDCs from property owners during the initial phase of the Highlands TDR Program.

The HDC Bank adopted a resolution at its September 3, 2009 meeting to launch its Initial Purchase Program. Under this program, the Bank will seek to purchase HDCs from property owners that qualify for hardship.

To qualify for consideration, a property owner must demonstrate that either: (1) the owner is experiencing an extenuating financial circumstance and that the owner’s equity in the property to which HDCs will be allocated is substantial in relation to the owner’s net worth, or (2): the property would have qualified for Exemption #3 under the Highlands Act, but for not securing a needed State land use or water permit where an application for that permit was pending before the Department of Environmental Protection as of March 29, 2004.

Offers to purchase HDCs from property owners facing hardship circumstances are to be prioritized based upon the following criteria adopted by the Bank on September 3, 2009:

1. The Bank shall give first priority consideration to any property that satisfies both of the following criteria:

a. comprises a major Highlands development that would have qualified for an exemption pursuant to paragraph (3) of subsection a. of section 30 of the Highlands Act but for the lack of a necessary State permit as specified in subparagraph (b) or (c), as appropriate, of paragraph (3) of subsection a. of section 30 of the Highlands Act; and for which an application for such a permit had been submitted to the Department of Environmental Protection and deemed by the department to be complete for review on or before March 29, 2004; and

b. which satisfies the extenuating financial circumstance criteria;

2. The Bank shall give second priority consideration to any parcel of land whose owner only satisfies the extenuating financial circumstance criteria;

3. The Bank shall give third priority consideration to any parcel of land that only satisfies the requirements of Sub-Paragraph (a)(i), above;

4. Within each of the priority levels set forth above, of paramount consideration is the protection of parcels of land which are of significant ecological or agricultural importance consistent with the Regional Master Plan.

The initial phase of the TDR Program was made possible by the appropriation of $10 million to the Highlands Development Credit Bank in September 2008.