Topic:
AGRICULTURAL LAND; ENVIRONMENTAL PROTECTION DEPARTMENT; GRANTS; LAND USE; LEGISLATION; MUNICIPALITIES; STATE AID; TAX CREDITS;
Location:
AGRICULTURE; LAND - ACQUISITION AND DEVELOPMENT RIGHTS;

OLR Research Report


September 24, 2008

 

2008-R-0529

VIRGINIA AND CONNECTICUT FARMLAND PRESERVATION PROGRAMS

By: Paul Frisman, Principal Analyst

You asked for a comparison of the farmland preservation programs in Virginia and Connecticut.

SUMMARY

Both Virginia and Connecticut have programs to purchase the development rights (PDR) of working farms. However, the programs differ in that Connecticut's program is statewide, while Virginia provides matching grants to localities (cities or counties) with their own PDR programs.

Both Virginia and Connecticut also have other open space preservation programs that include farmland in the mix of land to be preserved.

VIRGINIA'S PURCHASE OF DEVELOPMENT RIGHTS (PDR) EFFORTS

Under a PDR program, a landowner voluntarily sells his or her rights to develop a parcel of land (in this case, farmland) to a public agency or other organization charged with its preservation. The landowner retains all ownership rights; however, a conservation easement is placed on the land, preventing the parcel from being developed. PDR programs are most often used where developers are willing to pay more for the land than it is worth as agricultural land.

Virginia created its PDR program in response to studies showing that its farm population was aging, and that farm and forest land was being lost to development. In 2000, the Virginia General Assembly established the Virginia Agricultural Vitality Program in the state Department of Agriculture and Consumer Services. One year later, it reestablished the program as the Office of Farmland Preservation (OFP).

Unlike Connecticut's statewide program, Virginia's PDR program is locally-based. Virginia provides state matching funds to cities and counties with their own PDR programs. OFP reviews and approves these programs to ensure they comply with a model program developed in 2005 by the Virginia Farmland Preservation Task Force. The task force report is available on-line at http://www.vdacs.virginia.gov/preservation/pdf/pdfprogram.pdf.

According to OFP, there were 20 local PDR programs in 2007, with another 10 expected to be in place by 2010. OFP's 2007 annual report is available at http://leg2.state.va.us/dls/h&sdocs.nsf/By+Year/RD3382007/$file/RD338.pdf.

In 2007, Virginia's General Assembly authorized $4.25 million in matching funds for local PDR programs for FYs 2006-08 -- the first time the state provided funds to protect working farms and forest land. Localities seeking the matching funds faced a two-step application process: OFP had to certify first that they had available non-state matching funds; second, that the elements of their local PDR programs complied with the task force model.

OFP's annual report noted that 15 localities met the first deadline, reporting that they had a total of $45 million in local, federal, and private funds available for their programs. Fourteen of these met the second deadline for program certification.

OFP divided the $4.25 million in state matching funds by 14 (the number of certified localities). Localities that could not match this amount ($303,571) received an amount equal to their available non-state funding. The remaining money was apportioned in a second funding round among the programs that could provide a match of more than $303,571.

According to the Farmland Information Center, a partnership between the American Farmland Trust and the U.S. Department of Agriculture, Virginia's local PDR programs had preserved 21,705 acres of farmland as of January 2008.

CONNECTICUT'S FARMLAND PRESERVATION PROGRAM

Connecticut's PDR program, the Farmland Preservation Program (CGS 22-26bb and cc), seeks to preserve 130,000 acres of farmland, 85,000 of those in cropland. So far, the state has protected 32,300 acres in 234 farms statewide. A summary of the program's annual report is available on the agriculture department website at http://www.ct.gov/doag/lib/doag/farmland_preservation_/2007_annual_report_summary_mod.pdf.

Farmers interested in the program apply to the state agriculture department, which evaluates the applications according to criteria in state regulation (Conn. Agency Regs. 22-26gg-1 through 19). Each farm must meet minimum scoring criteria (Conn. Agency Regs. 22-26gg-4c), with higher scores awarded to farms with greater amounts and a higher percentage of prime farmland, i.e., soils best suited to produce food, feed, forage, fiber, and oilseed crops (CGS 22-26bb (g)).

Money for the Connecticut programs comes from state bond funds; the Community Investment Act, which provides funding through a $30 fee on documents recorded in town land records; federal funds; towns; and local land trusts. More information on this program can be found in OLR Report 2007-R-0229.

In 2008, the legislature enacted PA 08-174, which among other things, allows the agriculture commissioner to acquire development rights to more types of farmland. Prior law limited his authority to buy such land to farmland meeting the specified criteria. The act allows him to establish a separate program to acquire up to 100% of the rights to farmland that does not meet these criteria, and to purchase these rights jointly with a municipality. The act also caps the amount the agriculture commissioner can spend to buy development rights under the existing program at $20,000 per acre. More information on the act can be found at http://search.cga.state.ct.us/dl2008/sum/doc/2008SUM00174-R03HB-05873-SUM.doc.

OTHER OPEN SPACE PROGRAMS

Virginia

Virginia Land Conservation Foundation (VLCF)

Virginia established the VLCF in 1999 to fund the conservation of open space and parks, natural areas, historic areas, and farmlands and forests (Va. Code Ann. 10.1-1017). Money comes from the Virginia Land Conservation Fund, which is funded by annual appropriations.

Virginia Outdoors Foundation

The Virginia Outdoors Foundation (VOF), created in 1966, is authorized to hold any and all interests in cultural and natural resource properties in trust for the people of Virginia. The VOF is a “body politic,” with the characteristics both of an executive branch agency and independent public land conservation foundation (Va. Code Ann. 10.1-1800 et seq.). According to its 2007 annual report (available at http://leg2.state.va.us/dls/h&sdocs.nsf/By+Year/RD3492007/$file/RD349.pdf), the vast majority of its holdings are conservation easements donated by (and in some cases purchased from) landowners. The VOF receives funding from the Virginia General Fund ($1.3 million each in FYs 05, 06, and 07) and from a $1 land transfer recording fee imposed in towns with at least one VOF easement. It also receives private donations. Its total FY 07 budget was $2.445 million. According to the report, the VOF holds more than 2,000 conservation easements, covering nearly 406,000 acres.

Open Space Lands Preservation Trust Fund

In 1997, Virginia created the preservation trust fund, administered by the VOF, to help landowners pay the costs of donating open-space easements (Va. Code Ann. 10.1-1801.1). Landowners whose property has scenic, scientific, natural, historic, recreational, or open space value are eligible for this money, which amounted to $625,000 in FY 07. According to the VOF, the vast majority of the money goes to pay costs associated with the donation of easements on family farms.

Land Preservation Tax Credit

Virginia allows an income tax credit for 40% of the value of donated land or conservation easements (Va. Code Ann. 58.1-512). Taxpayers may use up to $100,000 per year for the year of sale and the ten subsequent tax years. Unused credits may be sold. Total credits for 2007 were capped at $100 million. The VOF calls the tax credit program the strongest such land incentive program in the nation; OFP Coordinator Kevin Schmidt says making the credits transferable led to a “huge spike” in donations. More information on these credits is available at http://www.dcr.virginia.gov/land_conservation/lpc.shtml.

Connecticut

The Department of Environmental Protection (DEP) oversees the Open Space and Watershed Land Acquisition Grant Program (CGS 7-131d-131k), which provides financial assistance to municipalities and nonprofit land conservation organizations to acquire land for open space, including farmland. More information on this program can found on the DEP website at http://www.ct.gov/dep/cwp/view.asp?a=2706&q=323834&depNav_GID=1642.

DEP also can buy open space land outright under the Recreation and Natural Heritage Trust Program (CGS 23-73 et seq.). More information on this program is available at http://www.ct.gov/dep/cwp/view.asp?a=2706&q=323840&depNav_GID=1642.

DEP's 2007-2012 “Green Plan” for acquiring and preserving open space land can be found at the following link: http://www.ct.gov/dep/lib/dep/open_space/green_plan.pdf.

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