A floating overlay zone is an unmapped district that, at the discretion of the City Council, may be superimposed on one or more established underlying zoning districts which may be used to impose supplemental restrictions on uses in these districts, permit uses otherwise disallowed, or implement some form of density bonus or incentive bonus program. The floating overlay zone can be affixed to a qualifying parcel of land, either upon the application of the parcel's owner or upon the initiative of the local City Council. Upon approval, the floating overlay zone is applied to the parcel and becomes a mapped overlay district. Its development is governed by the use of the underlying zoning district and the dimensional and other provisions of the Floating Overlay Zone Ordinance.

Floating overlay zones are distinct from overlay zones because of several features, the most significant of which is that overlay zones are mapped, and floating overlay zones are not mapped until legally placed. Floating overlay zones are also distinct from floating zones; the substantive difference is that a floating zone replaces an underlying zoning district, while a floating overlay zone works in tandem with existing underlying zoning districts.