City Council Memorandum
TO: HONORABLE MAYOR AND CITY COUNCIL DATE: April 21, 2026
FROM: COMMUNITY & ECONOMIC DEVELOPMENT WARDS: 1 & 2
DEPARTMENT
SUBJECT: UNIVERSITY AVENUE DENSITY TRANSFER PILOT PROGRAM
ISSUE:
Consider the adoption of the proposed University Avenue Density Transfer Pilot Program to permit the transfer of unused residential dens ity from “donor sites” to “receiver sites” to facilitate the development of vacant city-owned surplus parc els and Housing Element sites along University Avenue in the University Avenue Specific Plan area.
RECOMMENDATIONS:
That the City Council:
1. Determine that the University Avenue Densit y Transfer Pilot Program is exempt from further California Environmental Quality Act (CEQA) Review as it is consistent with the Final Environmental Impact Report prepared fo r the original University Avenue Specific Plan and with the 6th Cycle Housing Element Final Programmatic Environmental Impact Report, as it does not change the overall amount of development permitted in the Specific Plan; and
2. Adopt a resolution establishing the proposed University Avenue Density Transfer Pilot Program.
LAND USE COMMITTEE RECOMMENDATION:
On September 8, 2025, the City of Riverside City Council Land Use Committee recommended bringing a draft of t he University Avenue Density Transfer P ilot Program (Attac hment 1), that incorporates both the Developm ent Bank and Direct Transfer me thods, to the City Council for consideration and approval.
BACKGROUND
Density transfer programs (DTPs), also known as transfer of development rights programs (TDRs) are mechanisms to increase housing production wher e housing unit capacity is transferred from one parcel (donor site, also called a sender site) to another parcel (receiver site) (Figure 1).
Donor sites are often developed with nonresidential uses or de veloped below their residential development capacity. Their ability to transfe r their unused residential capacity can benefit receiver sites that may be difficu lt to develop or struggle with fi nancial feasibility. There are two primary models that density transfer programs employ for unit transfers: the Bank Method, where donor sites deposit units into a development bank, to be later withdrawn by receiver sites (Figure University Avenue Density Transfer Pilot Program
2), and the Direct Transfer Method, where donor sites directly send units to specific receiver sites (Figure 3).
Figure 1: Density Transfer Program. Infographic credit: NYC.gov
Beyond model type, density transfer programs can be tailored to meet a city’s needs in several ways, including:
Application city-wide;
Application to a targeted area (e.g., a distri ct, corridor, Specific Plan Area, etc.); Structuring with either narrow or broad criter ia for eligible donor and receiver sites; and Allowing direct transfers of the same or different product types, among other variations.
Housing Element Implementation:
The Sixth Cycle Update of the General Plan 2025 Housing Element, adopted for the 2021-2029 planning period, highlighted a densit y transfer program as a promis ing strategy to facilitate housing development in the City of Riverside (Program HE-E J-7-2-Density Transfer Program, P.25). In July 2023, Staff presented the density transfer program strategy to the Council Housing and Homelessness Committee as one of six potential housing tools to develop using Senate Bill 2 Planning Grant Program (PGP) funds, which the California Department of Housing and Community Development (HCD) awarded to the City in 2019 to implement infill housing development strategies from its Housing Element.
Donor
Site
Credit
Bank
Receiver
Site
Donor
Site
Receiver
Site
Figure 2: Bank Method
Figure 3: Direct Transfer Method
University Avenue Density Transfer Pilot Program
Development of the University Avenue Density Transfer Pilot Program:
In 2025, Staff explored the feas ibility of developing a pilot density transfer program in the University Avenue Specific Plan (UASP) Area (Atta chment 2). The UASP was selected as the focus area due to its challenges in achievi ng housing development c onsistent with existing policies. While the UASP has a maximum residential capacity of 6,819 housing units and 133 of its 138 parcels permit housing, less than 10% of this capacity has been developed (Attachment 3).
Most of the UASP area, although largely designated for residential or mixed-use development, is already occupied by nonresidential uses (Attachment 4). Fourteen city-owned parcels remain vacant due to their small size, limited develop ment capacity, and developer requests for additional units and density to make projects financially feasible. Many of the UASP’s parcels, including eleven of the four teen vacant city-owned parcels, are also Housing Element Opportunity Sites identified to help meet the City’s regional housing needs (Attachment 5).
The pilot program is intended to make housing development more feasible on constrained sites by providing additional development capacity without requiring amendments to the Specific Plan or General Plan. Beyond increasing the housing supply, the density transfer program could also help activate the UASP in other ways, such as improving the pedestrian environment and attracting new customers to local businesses.
On September 8, 2025, staff presented f easibility findings and two program alternatives, the Direct Transfer and Bank Me thods, to the City Counc il Land Use Committee (Attachment 6). The Committee recommended creating a hybrid program that combines elements of both approaches.
FINDINGS FROM OTHER CITIES’ DENSITY TRANSFER PROGRAMS
Staff researched existing programs in nine Sout hern California cities : Anaheim, Carlsbad, Eastvale, Escondido, Fontana, Lake Elsinore, Palm Springs, Rancho Cucamonga, and Santa Clarita. This research provided insight into program processes, best practices, and lessons learned. At the request of the Land Use Committ ee, key findings from this research are summarized below. Additional information on individual programs is included within the table and links in Attachment 7.
Bank Method Cities:
The cities of Carlsbad, Eastvale, Escondido, Fontana, and Lake Elsi nore all employed the Bank Method in their density transfer programs. These cities typica lly used the Bank Method to ensure maximum buildout and/or prevent the loss of residential capacity, the latter explicitly in accordance with Senate Bill (SB) 330, which prohi bits reductions in residential capacity in local jurisdictions.
Banks are seeded with residential capacity deriv ed from nonresidential development or from residential development constructed below a site’s or project’s maximum zoned capacity. In the cities that use the bank specifically to prevent the loss of residential capacity (Eastvale, Fontana, and Lake Elsinore), projects may also utilize local and state density bonus programs to gain additional units beyond those withdrawn from the bank.
Direct Transfer Method Cities:
The cities of Anaheim, Palm Springs, Rancho Cu camonga, and Santa Clarita employ the direct transfer method in their programs. These cities ty pically use this method to transfer residential capacity from environmentally s ensitive parcels or parcels wit h limited infrastructure to University Avenue Density Transfer Pilot Program
parcels that are less environmentally sensitive or have more existing infrastructure. Transfers are generally mediated or reviewed by the city during or after the unit transfer process.
DISCUSSION
Applicability:
The University Avenue Density Transfer Pilot Pr ogram would only be open to parcels within the University Avenue Specific Plan area. Parcels that are not within the Specific Plan area would not be eligible to participate in t he pilot program. If successful, th e Pilot Program may be converted to a permanent policy, expanded to a larger area, or both.
Donor and Receiver Site Eligibility:
To unlock the maximum underdeveloped residential capacity within the Specific Plan Area, most parcels would be eligible as donor sites, except for those that are already built to their maximum residential capacity, those lacking residentia l capacity, and 6th C ycle Housing Element sites, unless a site has been approved for nonresidential development or residential development below its maximum capacity.
To ensure the program m eets its goal of facilitating housing on vacant city-owned surplus sites and Housing Element sites, eligible receiver sites will be limited to these city-owned and Housing Element parcels.
Process and Approval:
Consistent with the Land Use Committee’s reco mmendation, eligible donor and receiver sites may participate in the program using either the Bank or Direct Transfer Method.
Bank Method:
Deposits
The City would initiate the development bank using residential capa city from city-owned surplus sites (see Attachment 8 for a full list of sites s eeding the bank). Beyond this initial seeding, the bank would be replenished as a condition of appr oval for nonresidential development or residential development construc ted below a site’s maximum residential capacity within the Specific Plan Area.
Applicants for donor parcels woul d submit a Request to Transfer Units to the appropriate approving authority, either conc urrently with their project ap plication or separately. A deed restriction would then be prepar ed and recorded on the property to document the transfer and surrender of residential development rights. Upon recordation, the Planning Division would credit the units to the development bank. Figure 4 illustrates this process.
EXAMPLE SCENARIO: Parcel A, a donor parcel, has a ma ximum residential capacity of five units.
1. If the applicant for Parcel A wants to cr eate a nonresidential use, building zero housing units, they must deposit all five units into t he unit bank. They must submit a Request to Transfer Units along with their project applic ation to the approvin g authority and have a deed restriction prepared docum enting the transfer and surrender of the units. Once the deed restriction is recorded, t he Planning Division wi ll count the five units deposited into the bank.
Units to be
surrendered
Submit Request
to Transfer Units
Request
Approved (w/
or w/o other
entitlements)
Deed
Restriction
UNITS
DEPOSITED
Figure 4: Depositing into the bank
University Avenue Density Transfer Pilot Program
2. If the applicant for Parcel A decides to bui ld three housing units, they must deposit the two undeveloped units into the unit bank. They must submit a Request to Transfer Units along with their project application to the approv ing authority and have a deed restriction prepared documenting the transfer and surrender of the units. Once the deed restriction is recorded, the Planning Division will count the two units deposited into the bank.
Withdrawals
Applicants for eligible receiver parcels may wit hdraw units by submitting a Request to Transfer Units, either concurrently with t heir project application or separat ely. Withdrawals from the bank will be processed on a first-come, first-serv ed basis; however, to promote the efficient development of surplus City land, projects on City-owned surplus sites will receive priority access if there are insufficient units to accommodate concurrent requests.
Unit withdrawals may be combined with density bonuses, concessions, or waivers for affordable housing, as permitted under Riverside Municipal Code Chapter 19.545 (Density Bonus) and the California Government Code, where applicable. If submitted with a project application, the appropriate approving authority will review and approve the request alongside other project entitlements; if submitted independently, the Planning Division will review and approve. Upon approval, the Planning Division will record the uni ts as withdrawn. Figure 5 illustrates this process.
EXAMPLE SCENARIO: Parcel B, a receiver parcel, is undeveloped and has a maximum residential capacity of five units. An applicant for Parcel B woul d like to develop residential units on the site, but needs an additional three units to be financially feasible. To withdraw the three units from the unit bank, the app licant must submit a Request to Transfer Units along with their project application to the approving authority. Upon approval, the Planning Division would count the units as withdrawn.
Direct Transfer Method:
Under this method, an applicant for a development project on an eligible receiver parcel would first identify and work with a repr esentative of an eligible donor parcel, either independently or through the Planning Division, to negotiate the transfer of units . Once the donor and receiver representatives reach an agreement, they would jointly submit a Request to Transfer Units to the Planning Division, along with the pr oject application if submitted concurrently. If part of a project application, the appropriate appr oving authority will review and approve the request alongside other entitlements. If submitted separately, Planning Division staff will review and approve.
Upon acceptance of the request, the applicant and the donor parcel representative will jointly draft a Density Transfer Agreement (“ Agreement”), which must be re viewed and approved by the Community & Economic Development Director and the City Attorney’s Office. The agreement will include a deed restriction document ing that the donor parcel forfei ts the right to build the transferred units. Once the agreement is approv ed and the deed restrictio n is recorded, the Planning Division will credit the units as transferred from the donor to the receiver parcel.
Applicant
seeks to
withdraw units
Submit
Request to
Transfer Units
Request
Approved (w/
or w/o other
entitlements)
UNITS
WITHDRAWN
Figure 5: Withdrawing from the bank
University Avenue Density Transfer Pilot Program
Figure 6 illustrates this process.
EXAMPLE SCENARIO: Parcel B, a receiver parcel, is undeveloped with a maximum residential capacity of five units. Parcel A, a donor parcel, is dev eloped with nonresidential uses and has a residential capacity of five units. An applicant for a development project on Parcel B would like to develop residential units on the site but discovers that the project would need to develop an additional three units to be financi ally feasible. After the applic ant for Parcel B seeks out the representative for Parcel A to tr ansfer three of its units, both par ties would submit a Request to Transfer Units, and bring the Request to Transfer Units to the appropriate approving authority to be approved with other project ent itlements. After approval, the applicant for Parcel B and the representative for Parcel A would jointly draft a density transfer agreement (“agreement”), and the applicant for Parcel A would agree to a deed restriction against development of future units. Once the agreement is approved and the deed restriction is recorded, the Planning Division would count the three units transferred from Parcel A to Parcel B.
Documentation and Monitoring:
Through the Request for Transfer applications and density transfer agreements, the Planning Division will track transfers in a database to be maintained th roughout the life of the pilot program. Unit transfers would be monitored to ensure that the Un iversity Avenue Specific Plan does not exceed its maximum residential development capacity of 6,819 housing units.
One year following the adoption of the program, the Planning Division will present a report to the City Council or designated standi ng committee describing the pr ogram’s implementation and impact with a recommendation on program continuat ion and the feasibility of future density transfer programs for the City.
FISCAL IMPACT:
There are no anticipated fiscal impacts with the proposed project.
Prepared by: Clarissa Manges, Assistant Planner; Sol Ramirez, Associate Planner Reviewed by: Miranda Ev ans, Interim Community & Economic Development Director Certified as to
availability of funds: Julie Ne mes, Interim Finance Director Approved by: Mike Futrell, City Manager
Approved as to form: Rebecca McK ee-Reimbold, Interim City Attorney
Concurs with;
___________________________
Sean H. Mill, Chair
Land Use Committee
Receiver
seeks units
from donor
Submit
Request to
Transfer Units
Request
approved (w/
or w/o other
entitlements)
Density
Transfer
Agreement
drafted
Deed
Restriction (for
donor parcel)
UNITS
TRANSFERRED
Figure 6: Direct transfer
University Avenue Density Transfer Pilot Program
Attachments:
1. University Avenue Density Transfe r Pilot Program Policy Document
2. Map of University Avenue Specific Plan Area
3. Map of University Avenue Spec ific Plan Residential Capacity
4. Map of University Avenue Spec ific Plan Land Use Designations
5. Map of University Avenue Specific Plan City-Owned Surplus and Housing Element Sites
6. September 8, 2025 City Council Land Use Committee Staff Report
7. Density Transfer Program s in Southern California
8. List of City-Owned Surplus Sites and Residential Capacity
9. Resolution
10. Presentation