Managed Retreat Toolkit


Zoning and Overlay Zones

Introduction to Zoning and Overlay Zones

Credit: Jay Diener, Seabrook-Hamptons Estuary Alliance.

Local governments have the primary authority to regulate land uses in their communities through zoning and floodplain ordinances. In particular, zoning ordinances provide the legal framework that governs the use and development of land in a municipality according to different districts based on the uses that are permitted (e.g., residential, commercial, industrial).See footnote 1 Overlay zones or districts can impose additional regulations on an existing zone based on special characteristics in that zone, such as for natural, historical, or cultural resources protection.See footnote 2 One advantage of overlay zones is that they enable local governments to address area-specific needs or requirements without disrupting underlying zoning classifications. To establish an overlay zone, local governments must: (1) establish the purpose for creating the district; (2) map the district; and (3) establish regulations to achieve the purposes for creating the district.See footnote 3  Before implementing any zoning or land-use changes, however, local governments must ensure that they have the authority to utilize a tool under state law.

Zoning and Overlay Zones in a Managed Retreat Context 

Local governments can use zoning and overlay zones to support a variety of purposes and goals related to managed retreat including to: 

  • Phase out development in vulnerable coastal areas experiencing sea-level rise, recurrent flooding, and land loss by limiting or prohibiting new development or redevelopment — particularly in a post-disaster context — above a specified legal threshold (e.g., “substantial damage”)See footnote 4 or requiring development setbacks or the removal or relocation of structures upon the occurrence of future physical impacts or “triggering” events (e.g., minimum beach width, permanent wetland encroachment; for more information, see the Managed Retreat Toolkit section on Regulatory Tools>Development Permit Conditions) (e.g., Florida Adaptation Action Areas, Norfolk, Virginia, “sending” areas for Transfer of Development Rights programs);
  • Prohibit hard shoreline armoring structures and promote the use of living shorelines (with natural or nature-based features) to facilitate the construction of natural shoreline protection measures that can enable coastal ecosystems to maintain their connectivity to the surrounding ocean and coastal environment and also remove structural barriers to inland ecosystem migration as sea levels rise and coasts are eroding (e.g., East Hampton, New York);
  • Protect inland habitat and species migration corridors and higher ground establishment areas that can support and sustain migrating habitats and species through natural resource conservation zones or overlays (e.g., Yankeetown, Florida); and
  • Allow increased density and more resilient design standards in higher ground or inland “receiving” areas (e.g., Norfolk, Virginia, “receiving” areas for Transfer of Development Rights programs).

Zoning and overlay zones can be combined with other planning, acquisition, and regulatory tools to facilitate larger-scale or layered retreat strategies. Notably, local governments should seek to coordinate zoning decisions with coastal zone regulations (at state and/or local level; it varies by state) that can overlap with and serve similar purposes to balance human coastal uses and conservation. Moreover, local governments should look at managed retreat strategies comprehensively to ensure that one type of tool or legal or policy decision will not undermine or conflict with another. For example, after conducting a neighborhood-wide buyout of 200 homes, Woodbridge Township, New Jersey rezoned the 120-acre buyout area from Residential to Open Space Conservation/Resiliency in order to, among other requirements, prohibit new development and only allow for passive recreational amenities like trails and open space uses to preserve the floodplain. Regulations can also be combined with incentives through acquisition or market-based tools (e.g., tax benefits, conservation easements) to remove or relocate structures in vulnerable coastal areas or floodplains. 

Although zoning is inherently a local government power, the state may also serve as a regulator in the coastal zone in some jurisdictions. In addition to their regulatory authority, states can be engaged in local land-use and zoning discussions and provide funding, technical, or other types of support to facilitate these managed retreat decisions. For example, states can consider working with local governments to fund and pilot the development of retreat-related overlay zones and create template language that could be adapted and replicated in other jurisdictions (e.g., Florida Adaptation Action Areas). In addition, states can play a key role in coordinating regional or cross-local government policies or actions that would require independent actions in more than one county or municipality. Local governments may also choose to work with state legislatures to amend or supplement zoning authorities — particularly in Dillon Rule states — where necessary.


Policy Tradeoffs of Zoning and Overlay Zones

Zoning decisions and overlay zones can vary in terms of purpose and scope, among other factors; therefore, it is difficult to assess the policy tradeoffs of these tools generally. There are, however, some overarching policy considerations for local governments. 


  • Zoning processes necessitate staff and funding resources, particularly to support community engagement processes around complex and politically sensitive discussions around retreat. Depending on the ordinance, zoning changes can also require administrative support to enforce restrictions. Smaller or rural communities may face more resource constraints and have less funding available to support specialized zoning staff for these purposes. 
  • Zoning restrictions may be more politically controversial than other non-regulatory tools because they will limit or regulate private property uses. 


  • Zoning decisions for retreat may have an impact — positive, negative, or neutral — on local tax bases. Where existing and future development is reduced or phased out in the face of sea-level rise, flooding, and land loss, governments will lose property tax rateables; however, where new development is intensified, local governments could experience gains in property tax revenues (or offset losses if zoning changes or overlay zones include both types of “sending” and “receiving” areas). 


  • Whether directly or indirectly (e.g., by increasing density in higher ground areas away from the coast), zoning and overlay zones can promote the conservation and protection of important coastal habitats that provide various environmental and community benefits. 


  • Zoning decisions are more successful when communities are engaged throughout both their development and implementation. By engaging communities, local governments can be more strategic, inclusive, and thoughtful about climate adaptation and managed retreat and minimize potential inequities — both in areas where existing and future development may be reduced or phased out in the face of sea-level rise, flooding, and land loss and areas where new development may be intensified and could cause existing residents and businesses to be displaced (e.g., climate gentrification).
  • To promote equitable outcomes, zoning should, at a minimum, prioritize the provision of recreation areas and public access in coastal areas and the development of affordable housing in receiving areas. 
  • Zoning changes coupled with economic incentives may help to offset potential regulatory costs, particularly on frontline communities. 


Legal Considerations for Zoning and Overlay Zones

By amending zoning ordinances, the most common legal challenge governments may face is takings claims. Jurisdictions can design zoning changes in ways that can withstand potential regulatory takings challenges and minimize potential legal risk. The Fifth Amendment of the U.S. Constitution and analogous provisions of state constitutions prohibit governments from “taking” private property without just compensation.See footnote 5 While there are different types of takings, courts apply a “per se” test to physical occupationsSee footnote 6 and regulations that deprive a private property owner of all or essentially all of his/her property’s economic value;See footnote 7 however, in a managed retreat context, most zoning regulations designed to protect people, property, and the coastal environment will be evaluated under a case-by-case-specific balancing test.See footnote 8  Generally, courts will uphold zoning changes that restrict or limit development in vulnerable coastal areas and floodplains if an affected property maintains some economic value and a regulation serves a legitimate public interest, such as safety or to offset ecological impacts resulting from the use of private property. 

Governments can avoid or mitigate potential takings risk by ensuring that zoning changes and overlay zones are informed by relevant data and plans, particularly local comprehensive plans. At a minimum, governments should: clearly justify the need for zoning amendments based on best available data; articulate the purpose for new development and redevelopment requirements in planning and other documents that put affected private property owners on sufficient notice; and design and implement zoning decisions on appropriate spatial scales that are not greater than the spatial area necessary to achieve their stated purpose (e.g., establishing lower density development requirements only in a municipality’s coastal areas most vulnerable to sea-level rise and erosion to protect people and property from these physical threats). For more information on takings and recommendations to minimize legal risk, see the Crosscutting Legal Considerations>Takings section of this toolkit. 


Practice Tips

When implementing zoning changes and overlay zones in a managed retreat context, decisionmakers may consider the following practice tips to address and balance different legal and policy tradeoffs: 

  • Create integrated long-term comprehensive plans, which provide a durable legal framework to implement zoning: Clear and well-designed comprehensive plans provide a more durable legal framework for zoning and a greater level of certainty for public and private investments around long-term managed retreat strategies. If well designed, this certainty is a key economic development strategy. Zoning that is constantly changed and amended can have a chilling effect on new investments. 
  • Evaluate how zoning can be used to meet local needs for managed retreat: Communities will have varying needs associated with managed retreat and local governments should consider how zoning changes or overlay zones can help them achieve different purposes, goals, and objectives. Local governments can avoid “reinventing the wheel” by using these longstanding tools but apply them in ways that will support areas affected by rising seas and other climate impacts.
  • Invest in data at an appropriate scale: Local governments will need the best available data and information on an appropriate scale to effectively guide and inform planning and zoning decisions. While specific data needs will vary based on a proposed zoning change or purpose, governments can consider the following data relevant to informing planning and zoning changes: sea-level rise and erosion rates, shoreline conditions, demographics, economics, and the location of existing and migrating coastal habitats like wetlands and forests.

    While some governments may already have the necessary data, others will have to invest in or look for opportunities to obtain data before they can engage their agencies and communities in discussions about managed retreat. Notably, much of this data (e.g., demographic projections, environmental studies) may already be collected by local governments to support local comprehensive planning processes and could also be leveraged for zoning purposes. In addition, federal agencies (e.g., National Oceanic and Atmospheric Administration, U.S. Geological Survey) and conservation nonprofits (e.g., The Nature Conservancy) may have data on an appropriate scale that governments can use to inform the development of their plans and corresponding legal and policy decisions. Alternatively, local governments may have to consider grant or other funding opportunities to initiate partnerships to collect this data from scratch. Community residents — particularly those who have lived in an area for a long time or have historical or cultural ties — can provide additional types of data or information based on historical or lived experiences that, among other things, can help governments better understand cyclical or long-term changes on the coast to inform zoning discussions. Governments, therefore, should aim to make data collection processes as comprehensive as possible and reach out to more than just traditional experts. 
  • Engage communities: Local governments should seek to engage community members throughout the entirety of comprehensive planning and zoning processes for managed retreat, especially those who live, work, or have other interests (e.g., recreational) in an area that is the subject of potential zoning changes. Comprehensive plans and zoning can affect the daily lives and livelihoods of residents, so it is important for local governments to include those most directly affected in these discussions. In addition to minimizing potential legal risk (see bullet below), community engagement processes can help local governments craft stronger decisions that better support community or neighborhood priorities, needs, livelihoods, and overall well being. For example, in areas rezoned for natural resource conservation purposes, governments can work with residents to identify wetland migration corridors that do not conflict with other private property uses. Similarly, residents could aid governments in identifying potential higher ground receiving areas that need revitalization or new investments and would not cause the displacement of current residents (e.g., climate gentrification). 
  • Align zoning with different types of local plans and initiatives: Local governments should strive to align zoning decisions with different types of local plans and initiatives, in addition to long-term comprehensive plans. Aligning zoning decisions with other plans and initiatives can offset various administrative and economic tradeoffs. This can occur when governments aim to coordinate land-use and zoning actions across different types of plans and agencies that have related authorities or actions. Additionally, this alignment can help maximize environmental and social/equity benefits and minimize the associated costs by avoiding conflicting decisions from different agencies. For example, if a local government creates an overlay district in its local comprehensive plan to discourage or limit new residential development and promote the conservation of open space in a vulnerable coastal area, transportation-related plans (e.g., Long Range Transportation Plans) should not prioritize siting new roads in that location. 
  • Minimize potential legal risk by implementing zoning changes that are informed by communities and plans: By engaging residents throughout the entire process of planning and proposing changes to zoning regulations, governments may be able to avoid or mitigate potential legal challenges by proactively seeking and addressing public concerns and conflicts. In addition, comprehensive plans especially can serve as legal and policy guidance that put residents “on notice” of regulatory decisions that may impact private property rights. In light of potential takings litigation, courts often evaluate whether local governments provided adequate notice to private property owners as one factor in assessing whether a takings has occurred. Generally, courts view public notice as one factor, among others, favorable to governments in finding that a takings has not occurred. Finally, local governments should seek to document the findings of their zoning decisions (e.g., scientific, economic, safety) in comprehensive plans and other documents to produce an administrative record that can show the reasons and justification underlying a municipality's managed retreat decision (e.g., to protect lives and property). For more information on takings, see the Crosscutting Legal Considerations>Takings section of this toolkit.

Related Resources

Building a Better Norfolk: A Zoning Ordinance of the 21st Century - Norfolk, Virginia

The City of Norfolk, Virginia adopted a new zoning ordinance to enhance flood resilience and direct new more intense development to higher ground. The ordinance establishes a Coastal Resilience Overlay zone, where new development and redevelopment will have to comply with new flood resilience requirements, and an Upland Resilience Overlay, designed to encourage new development through upzoning in areas of the city with a lower risk of flooding.

East Hampton, New York Coastal Erosion Overlay District

In 2006, East Hampton created a Coastal Erosion Overlay District to minimize the environmental impacts from the construction of erosion and flood control structures on private property. Through its ordinance, East Hampton combined the use of two regulatory tools — for hard armoring restrictions and overlay districts — to regulate shoreline armoring. Within the Coastal Erosion Overlay District, the town designated four oceanic and bay coastal zones, and prohibited shoreline armoring in all but one region of the town where there was a lot of existing armoring that serves as the only form of protection for existing natural resources. In the other three zones, the town requires a Natural Resources Special Permit for the repair, reconstruction, or alteration of preexisting erosion control measures (i.e., that predate the date of this ordinance). As a result of this overlay district, the city will look to emphasize and permit nonstructural erosion control solutions instead. East Hampton took a balanced approach allowing owners to maintain existing armoring, while also promoting living shoreline approaches in areas where it will provide a viable solution for reducing flooding and erosion.

Managing the Retreat from Rising Seas — Woodbridge Township, New Jersey: Post-Hurricane Sandy Buyouts

Woodbridge Township, New Jersey combined buyouts with land-use and zoning changes to implement a larger-scale retreat for 200 homes. In 2016, Woodbridge’s mayor and City Council rezoned its 120-acre buyout area from Residential to Open Space Conservation/Resiliency to prohibit new development and only allow for passive recreational amenities like trails and open space uses to preserve the floodplain. In addition, existing homes in the Open Space Conservation/Resiliency Zone have to be elevated at least one foot above federal requirements set by the Federal Emergency Management Agency when specified “building design standards” are triggered. By establishing the Open Space Conservation/Resiliency Zone, the township aims to protect its bought-out area as natural flood buffers by encouraging people to sell their homes to the state instead of investing in expensive home elevations. Moreover, this zoning ordinance can also discourage private developers from quickly purchasing properties at a low cost after a disaster and then rebuilding in vulnerable floodplains. Local governments can layer or combine land-use and zoning changes with other retreat strategies, like buyouts, to institutionalize open space protections.

Yankeetown, Florida Natural Resource Adaptation Action Area

The Town of Yankeetown, Florida is utilizing a state-authorized land-use planning tool — called Adaptation Action Areas — to mitigate the impacts of sea-level rise on local ecosystems. These changes also affect the town’s zoning map and regulations. Yankeetown is experiencing coastal inundation due to sea-level rise that is causing large swaths of coastal forests to rapidly decline and salt marshes to migrate inland, creating a phenomenon known as “ghost forests.” Yankeetown amended its local comprehensive plan to create a “Natural Resource Adaptation Action Area” (NRAAA) overlay district. On the town’s zoning maps, NRAAA is composed of two areas — the Resource Protection and Residential Environmentally Sensitive areas. Through Yankeetown’s zoning ordinance, these areas provide for natural resource protection by requiring no or low-density development (depending on the area) and a 50-foot development setback from water bodies and wetlands. These tools are helping Yankeetown shape future growth and development to conserve and protect its natural resources in the face of rising seas. Local governments could consider adopting overlay districts like Adaptation Action Areas and amending their land-use and zoning ordinances to reduce or limit development in wetland and forest migration pathways as a part of comprehensive retreat strategies.

Annexing Higher Ground and Preparing Receiving Areas in Hamilton, Washington

In 2019, after decades of repetitive flooding, the town of Hamilton in Skagit County, Washington partnered with Forterra, a local land conservancy nonprofit, to annex a 48-acre parcel of land located outside of the town’s 100-year floodplain. Annexing this land will provide Hamilton with a higher, drier ground area where town residents could voluntarily relocate to new homes. In 2007, Hamilton recognized the need for flood mitigation solutions and, accordingly, initiated the expansion of its Urban Growth Area in order to approve an area that could be designated as a receiving community in a future relocation plan. The 48-acre parcel annexed in 2019 is located within the Urban Growth Area expanded over a decade before. Hamilton provides an example to municipalities and local governments for the proactive rezoning of areas outside of the floodplain that could one day serve as receiving communities. 

City of Marina, California Urban Growth Boundary Initiative

In November 2000, the City of Marina approved an update to add an Urban Growth Boundary (UGB) to its city General Plan and Local Coastal Program (LCP) to prevent urban sprawl and to preserve undeveloped land near the coast. City residents voted on and supported this amendment — called the Marina UGB or UGB Initiative — to protect open space uses and natural resources in the city for 20 years. The main purpose of the UGB Initiative is to restrict land within the UGB to park and open space uses until at least December 31, 2020 (when the current initiative expires, unless it is extended by the city). Low-density zones that were mapped along the coast provide the guidance and land-use controls for these areas. While the UGB and low-density zones were not established for the explicit purpose of managed retreat, they can serve as an example of land-use and zoning tools other municipalities could consider to conserve coasts, natural resources, and other open spaces in the face of sea-level rise and erosion. UGBs and low-density zones also proactively preclude the siting and development of barriers to the inland migration of coastal wetlands.

California Coastal Commission DRAFT Coastal Adaptation Planning Guidance: Residential Development

This resource presents selected model comprehensive planning goals, objectives, and policies meant to address local sea-level rise adaptation for a hypothetical city/county in Southwest Florida. It offers best practice examples from other jurisdictions that illustrate the use of sea-level rise adaptation policies, and it concludes that “low or no regrets” actions can be implemented now and in many cases already have been taken by one or more local jurisdictions. Model Goal 1 creates a "Vulnerable Area" overlay for spatial planning, while Goals 2, 3, and 4 establish a framework for comprehensively pursuing protection, accommodation, and managed retreat strategies within the overlay.

New Hampshire Senate Bill (S.B.) 285: Establishing a Coastal Resilience and Economic Development Program

The State of New Hampshire passed Senate Bill (S.B.) 285 to establish a coastal resilience and economic development program and provide local governments with innovative new tools to address climate emergencies due to sea-level rise, storm surge, and flooding. One notable provision of the bill allows municipalities to create overlay districts called “Coastal Resilience and Cultural and Historic Reserve Districts” and an accompanying fund to acquire land and relocate cultural and historic structures to higher ground less vulnerable to sea-level rise and flooding. This state law authorizes local governments to engage in land-use and zoning changes to preserve and manage the retreat of important cultural and historic assets.

Managing the Retreat from Rising Seas — San Diego, California: ReWild Mission Bay

In San Diego, California, the city and various stakeholders are evaluating different land-use and planning alternatives to conserve and restore migrating wetlands in Mission Bay as a part of local decisionmaking processes. To conserve and restore Mission Bay, San Diego Audubon and other partners started an initiative called “ReWild Mission Bay” that evaluated different alternatives for protecting wetlands through a feasibility study, the Wetlands Restoration Feasibility Study Report, that outlines a potential future for Mission Bay. One of the feasibility study’s alternatives aims to relocate Campland on the Bay, an existing RV campground on land owned by the city, inland to attain community resilience and environmental benefits. To facilitate retreat for coastal wetlands, local governments, like San Diego, may have to consider relocating existing development and altering existing land uses. Debate about relocation of the Campland site demonstrates the policy tradeoffs that decisionmakers may need to navigate when phasing out land uses to restore coastal habitats. Some environmental stakeholders opposed the relocation of Campland and instead called for Mission Bay Park to be zoned only for natural environmental restoration and restored, as much as possible, to wetland habitat to facilitate sea-level rise adaptation. The differences in opinion raise a question about whether environmental restoration should be inclusive or exclusive of human development. Land-use planners and regulators will likely need to balance interests in preserving traditional park recreational uses in their current state against the benefits of maximizing restoration further inland to prepare for migrating habitats.

Sea Level Rise Ready: Model Comprehensive Plan Goals, Objectives, and Policies to address SLR Impacts in Florida

This guidebook is designed for local governments of coastal communities in Florida interested in integrating Adaptation Action Areas (AAA) into local comprehensive plans and zoning ordinances. Adopted into Florida law in 2011 through the Community Planning Act, an “Adaptation Action Area” (AAA) is an optional designation within a local government’s comprehensive plan for areas that experience coastal flooding and sea-level rise — for the purpose of prioritizing funding for infrastructure needs and adaptation planning. Although AAAs are more of a planning tool, they require local governments to make changes to their zoning ordinance to be implemented. The Florida Department of Economic Opportunity (DEO) created this guidance primarily to assist communities in using AAAs to adapt to coastal flooding. The guide introduces methods to tailor adaptation strategies to the unique vulnerabilities of each community and to utilize the AAA strategies, as well as to meet other local goals to enhance community resilience. Local governments could evaluate Florida’s example to translate AAA into overlay districts for managed retreat in their own jurisdictions. States can also look to the guidebook as a resource to provide support for local governments interested in creating AAA.

Creation of “Adaptation Action Areas” in Florida's Community Planning Act

The 2011 Florida Legislature passed the Community Planning Act (CPA – HB 7207) making significant changes to the state’s growth management laws, including the addition of optional adaptation planning for coastal hazards and the potential sea-level rise impacts. Adaptation Action Areas (AAA) are an optional comprehensive plan designation for areas that experience coastal flooding and are vulnerable to the related impacts of rising sea levels for prioritizing funding for infrastructure and adaptation planning. The CPA allows local governments to adopt AAA and consider policies in their local comprehensive plans to improve community resilience to coastal flooding. AAA designations allow local governments to adopt policies and direct resources to increase the resilience of that area to future sea-level rise. Although AAAs are more of a planning tool, they require local governments to make changes to their zoning ordinance to be implemented. Florida’s CPA could serve as a model for states considering granting local governments the authority to design and implement sea-level rise adaptation strategies, including for managed retreat, through land-use and zoning plans and ordinances.

Adaptation Action Areas Guidebook: A Planning Guidebook for Florida's Local Government

In draft sea-level rise adaptation guidance from the California Coastal Commission (CCC), the state provides template language for overlay districts that could be combined with development permit conditions to implement managed retreat strategies. In March 2018, CCC released Draft Coastal Adaptation Guidance for Residential Development (Draft Guidance) to provide information on sea-level rise adaptation options and examples of legal and policy tools cities and counties in the state can consider for residential, compared to other types of community development (e.g., infrastructure). Among other parts of the Draft Guidance, CCC proposes model policy language that local governments could incorporate in coastal or land-use plans and ordinances to create a Sea-Level Rise Overlay District. New development or redevelopment within that overlay district could also be combined with a local Managed Retreat Program (described in more detail in this case study) to facilitate the removal or relocation of vulnerable coastal structures. Local governments in California and other states can consider adopting or modifying this model language for managed retreat in their own jurisdictions.

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