What is contract zoning?

Contract zoning occurs when a particular area which is zoned for one type of development is rezoned to another classification based on an agreement between the government and the party that will be using the land. In other words, if an area's zoning code is for residential use but a business wants to make use of it as commercial land, it would be considered contract zoning if the government rezoned the area as commercial based on an agreement by the business to restrict their use to avoid some use that is objectionable to the public. For example, in exchange for being given the land on a commercial zoning basis, the business might agree not to build a large parking lot. This would be considered a contract zoning agreement.

The term “contract zoning” refers to the fact that the government and the party that will make use of the land have essentially set their own contract, between themselves, regarding the land's use and regulations placed upon it. The problem with contract zoning is that it is notoriously done for private benefit and is not often considered something beneficial to the community or public at large. For this reason it carries something of a bad reputation. Contract zoning is not actually a specific type of zoning code or zoning regulation; the term is a legal one that a court may apply to such a zoning arrangement should it be brought to their attention and examined for any reason.

Contract zoning may be a good option for you if you need to use your land for something other than what it is zoned for. Contract zoning will not, however, be possible in all cases. To have the best chance of arranging into a private re-zoning contract or agreement, it is in your best interests to speak with a lawyer for help.