Agriculture & Conservation Easements

 

Long ignored by the Conservation Land Trust community are small producing family farms and ranches. This is surprising since some of the best open land remaining in parts of the rapidly developing west, are these small family farms and ranches. The Land Trust community feels that small farms and ranches (under 100 acres), are inappropriate for conservation easements. The theory is that is it unrealistic to require that a piece of property remain in agriculture in perpetuity, thinking that it might be better suited to small, subdivided lots in the near future. This thinking is unfortunate because preserving these lands in agriculture accomplishes many things.

 

  1. The tax credits the family receives as a result of granting a conservation easement can be a significant economic boost to the family and can provide funding for other types of revenue production from their land. For example these funds can be used to purchase better farm equipment, build a greenhouse, invest in animals, plants or seed or to install solar panels or wind generators, which pay back in to the grid in addition to providing electricity for the farm.
  2. Small producing family farms and ranches allow working families to significantly supplement their regular income with income from their land – growing and producing products for sale from the farm, in farm stands and at farmer’s markets, which enhance the local economy.
  3. Small producing family farms and ranches encourage people to produce their own food and to buy locally and can significantly impact the local environment in a positive sustaining manner. Preserving this in perpetuity provides a more secure environmental future for a community.
  4. Small producing family farms and ranches create wildlife habitat and scenic vistas. Starting such a trend in a neighborhood can cause a domino effect that creates much larger swaths of wildlife habitat, wildlife corridors and scenic vistas. The land will remain open with forage for wildlife.
  5. Frequently there are historic elements worth preserving on a family farm – an old farmhouse or barn, fencing and survey marks, old trees and orchards, antique farm equipment, family cemeteries and oral traditions. The farm might be a part of a much older homestead that was already subdivided many years ago. Preserving as much of that as possible is a worthy task.
  6. Annual monitoring of an agricultural conservation easement gives the Land Trust an on-going opportunity to educate in the areas of responsible land stewardship, weed control, soils preservation and eco-friendly or green agricultural land-use practices. The Land Trust is in a unique position to encourage composting programs and locally grown food initiatives – programs that truly provide for the responsible use of open space and can provide an enormous public benefit to the community as a whole.

The State of Colorado Legislature is considering restricting the amount of tax credit dollars that will be available annually starting in 2011 for conservation easements. If passed this would greatly restrict the number of all easements accomplished annually. Since in reality, agricultural easements carry a much more significant benefit to the public than other types of conservation easements, I believe they should be separated out from the traditional conservation easements. They should be given their own recognition as a class of conservation easements. Fully funded, these agricultural conservation easements will multiply and significantly enhance the sustainable long-term health of Colorado families, economy and land.

Agricultural Designation

In La Plata County, Colorado, vast areas of previously agricultural lands have been subdivided into ranchettes of 3, 5, 10, 20, 35 acres in size over the last 25 years.  Often these properties are still vacant, sold to an out-of-town owner who is planning to move here when they retire. Meanwhile, the taxation on the property was changed to “vacant land” from “agricultural” when a plat splitting it off from a much larger agricultural tract occurred. Agricultural lands are assessed at a significantly lower rate than vacant land. Depending on the size and location of your parcel and any special assessments for your particular property, you could easily cut your tax bill by hundreds or even thousands of dollars if you can have the taxation changed back to “agricultural”.

 

In La Plata County, the Oil and Gas industry has been picking up the lion’s share of our tax base for those 25 years and property taxes on “vacant” land might look downright reasonable to someone from Texas or California or Florida, used to paying that same amount quarterly or even monthly for their home there. However, this may change soon as changes in Oil and Gas regulations at the state level may cause our county industry tax yield to shrink. Property taxes for the average landowner will increase to meet the financial needs of the county and local taxing districts.

 

Property owners can take steps to change their taxation status back to “agricultural”. The process will take a few (usually two) years of application for the status change and providing proof that the change is warranted before the change is seen on the tax bill.

 

The easiest step is to enter in to a grazing lease with a local large animal owner. Owners of horses, cattle, sheep and goats are frequently looking for a near-by location (10 acres or more) to graze their animals for a few months. It allows their property to rest, or produce hay. The owner will check and repair your existing fencing and commit to having their animals on your property for a period of time annually. They will haul water to the animals if you have no irrigation water available but it is better if you do or if they have water they can deliver to your property through ditches. Usually the leases are simple, renew year to year automatically until canceled in writing and the Lessee pays the Lessor $1. Provided that the Lessee has their animals on your property for a few months every year, the Assessors office will grant the agricultural designation. We can connect landowners with local animal owners, draft the leases and work with the Assessors office annually to get your designation changed.

 

There are other methods, particularly useful when your property is within a subdivision that does not allow the grazing of large animals. Do you have irrigation water and can crops be grown on your property? There are individuals who would jump at the chance to grow produce on your property, have a community garden, install a moveable greenhouse. Can you plant a tree farm or fruit orchard? Irrigation water is key and without that there is little you can do to have your vacant land designation changed to agricultural. Restrictive covenants are often too restrictive for any agricultural use. If that is the case, think about how many of your neighbors are in the same situation. Covenants can be changed by a majority vote of the landowners. If most of your subdivision is still vacant, it might be worth a conversation with your neighbors about entering in to some sort of agricultural use together for a limited period of time.

 

 

Family Farms

The recent downturn in the economy has families thinking….is there some way to cut back on expenses and produce food at home? In recent years, the growth of farmers markets and buy local initiatives have encourged thoughtful consumers to enjoy food produced closer to home. Now, their own back yard is looking more appealing. Chicks, vegetable seeds, backyard greenhouses, hen houses are all in hot demand this year. Planning departments report a significant rise in questions concerning the need for permitting of structures or farm stands, the legality of selling eggs and produce from home and the need for permitting when producing food for sale at a Farmer's Market. Regulations vary widely. Rural areas will likely require little to no permitting for any type of agricultural activity although most permanent structures over a certain size (around 250 sq ft) will require a building permit. Even limited selling directly from the property will likely be allowed or overlooked in rural areas. Many towns and cities have passed ordinances allowing hens for the production of personal consumption eggs, sometimes along with design restrictions of the nesting shelter. Urban areas are unlikely to allow you to sell from your property even with permitting, although food and goods produced at home but sold at a Farmer’s Market will be allowed without a permit. Prepared foods (jams, breads) usually must come from a Board of Health certified kitchen. Planting fruit trees will never require permitting, although there may be a subdivision covenant approval needed. Fruit trees are a good long-term investment in future food profits. It is the lucky landowner who already has producing fruit trees. Gleaning (collecting fruit from trees on other’s property - with their permission or from public property) can yield a significant amount of fruit to be sold at a Farmer’s Market or used to produce juice and other products. Learning to use edible wild plants can be a significant food source for your family as well. Property owners producing food at home are encouraged to apply for an agricultural taxation designation for as much of their property as is in production or grazed. It will take a few years of this use to get the desigination changed, but the pay-off can be substantial. There are many legal ways to use your land to produce food for your family or for profit, just apply your creativity!

About Colorado Land Planning

Colorado Land Planning offers Land Use Planning Assistance including feasibility assessments, permitting,  Agent services, subdivisions, creation of common interest communities, documents prep and research of historic water rights, ditch rights, easement and mineral rights - full planning services for developers, property owners, surface owners and heirs.

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