Designated Neighborhood Development Area

Neighborhood Development Area Designation Benefits:

This designation program increases housing options by reducing the time and cost of state permitting in areas within easy walking distance of commercial centers — whether converting a wing of a house into an apartment or developing an entirely new neighborhood. Municipalities or developers may use this designation to encourage the creation of new homes in development-ready locations near shops and services and to reduce pressure to develop on farm and forest land. State designation of neighborhood development areas (NDAs) provides incentives for housing developers and municipalities to help increase the creation of new homes within walking distance of shops, jobs, services, and schools.

Benefits to Developer:

State Permitting
■Qualified mixed income housing projects are exempt from review. See Priority Housing Project flow chart to learn more on projects that qualify■Act 250 projects not qualifying for the exemption receive a 50% discount on application fees
■Act 250 offsite mitigation fees are reduced for projects impacting primary agricultural soils in NDA’s associated with a designated downtown, and that are subject to Act 250 review.
■If subject to Act 250, projects within an NDA (and other designated areas) are within an “existing settlement” and not required to provide additional analysis under Act 250 Criterion 9(L) that addresses scattered development.
■Agency of Natural Resources fees for wastewater review are capped at $50.00 for projects that have received sewer allocation from an approved municipal system.

Tax Benefits
■Exemption from the land gains tax for housing units that are sold.

Municipal Regulation
■Local conditional use decisions that determine the “character of the area” criteria is met, cannot be appealed to the Environmental Court if the project is within an NDA.

Benefits to Municipality:

■Priority consideration is available for various grants and incentives supporting projects within an NDA including:
■Municipal Planning Grants (ACCD)
■Vermont Community Development Program (CDBG) Grants (ACCD)
■Better Connections (VTrans/ACCD)■Brownfield Revitalization (ANR/ACCD)
■State affordable housing funds

ACCD Assistance
■Training and technical assistance from ACCD on obtaining benefits.

To learn more visit the VT Agency of Commerce & Community Development’s website.