Bacon's Rebellion

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Conservation Easements in Isle of Wight County

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by

James A. Bacon
in

Isle of Wight County has garnered national recognition for its rural landscape preservation program. The National Association of Counties has named the rural economic development program the “best overall program” in the country, reports the Daily Press.

What’s so special? Isle of Wight has $2.2 million, and plans to add $500,000 a year to the pot, to purchase conservation easements from county farmers. The goal is to preserve 2,000 acres by 2010. The plan benefits farmers, who get to pocket some cash and enjoy lower taxes on their land. The plan benefits the county because it provides financially hard-pressed farmers an alternative to selling off chunks of their land to pay the bills. When that land is developed, it puts financial pressure on the county to extend services to the people who move there. Purchasing the easements helps the county avoid those costs.

A committee will review applications and make recommendations to the Board of Supervisors, which will make the final decision on which easements to purchase.

I’m wondering if this might provide an attractive alternative to the state practice of granting tax credits to landowners who bequeath conservation easements. Financially, a tax credit differs little from an outright purchase of the easement — money still comes out of the state’s pocket. The virtue of the Isle of Wight approach is that a committee evaluates the alternatives and, presumably, ranks them according to the county’s priorities.

Frankly, I’m not sure how the state conservation easement program works, now that the General Assembly has capped the value of tax credits that can be granted in any given year. Are landowners granted the easements on a first-come, first-serve basis, with unfunded requests carried over to the next year? Does anyone in the state formally review and rank the requests according to the state’s priorities? Inquiring minds want to know.

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15 responses to “Conservation Easements in Isle of Wight County”

  1. E M Risse Avatar
    E M Risse

    The details are interesting, the big picture is critical.

    Isle of Wright County is over 230,000 acres. 2,000 acres is less than .9 percent of the area of the County.

    Isle of Wright County’s New Urban Region location suggests at most 4 or 5 percent can be sustainably maintained in urban land uses.

    Some of Isle of Wright is already protected — Ragged Island, etc. — but this leaves over 95 percent either urban or unprotected.

    Programs like this only fool the Geographically Illiterate into thinking something meaningful is being done.

    Kaine’s 400,000 acre goal is 1.6 percent of the Commonwealth. We do the numbers in “Quantificantion of Land Resources and the Impact on Land Conservation,” a Backgrounder at db4.dev.baconsrebellion.com

    Without Region-wide and Commonwealth-wide strategies and plans for the optimum location of urban and nonurban land, this “best-in-the-nation” program will do more harm than good.

    As no less of an athority on land conservation than Pat Noonan, past president of The Conservation Fund, stated recently in a state-wide meeting that the only thing worse than no easements is scattered easements in the worng location.

    Farm by farm easements and farm use taxation in small, scattered locations or with interior hold-outs only exacerbate dysfunctional distribution of urban land uses.

    EMR

  2. Larry Gross Avatar
    Larry Gross

    Doesn’t the Comp Plan need to lay out WHERE they want CONTIGUOUS land not developed.

    Perhaps their plan does exactly this and not well reported.

    Their plan should not get awards because it simple does “more” when “more” does not reflect any kind of intelligent longer term planning goals.

    Allowing any undeveloped land anywhere within the county to be elgible to be purchased – does what?

    Allowing (encouraging) random odd parcels to be set aside even if they are inside the designated development area does what?

    There is a feeling that setting aside land anywhere.. is a good thing.

    I don’t think it is. I think it actually contributes to undermine existing planning and introduce more chaotic dynamics into overall planning.

    This is why the State is starting to get cold feet over this.

  3. Anonymous Avatar
    Anonymous

    Mr. Bacon,

    Why don’t you call Bob Lee at the Virgnia Outdoor Foundation and find out the answers to your questions? Maybe a little research before you blog might be needed?

  4. Ray Hyde Avatar
    Ray Hyde

    “The plan benefits farmers, who get to pocket some cash and enjoy lower taxes on their land.”

    This is simply not true: it does not benefit farmers.

    After a conservation easement the farmer pays the same tax rate on his land as he does under farming land use, so no savings there.

    The farmer does pocket some cash, but he does so at the expense of a permanent loss in cash value of his land. It is nowhere near a fair trade: the cash he pockets doesn’t even represent a fair discounted return on investment for the loss he takes.

    And, while the farmer gives up a permanent easement, there is no guarantee that the county tax treatment will be permanent as well. As far as I know, no county has reneged on the tax treatment, yet.

    However, to the extent that the value recived by the farmer is less than the value given up, the difference can be treated as a gift, and there is a (federal) tax break available there. This tax break is only of value if the farmer has sufficient income to actually use the tax break.

    Probably the best benefit to the farmer is that after the conservation easement he can give up farming, and save himself all the cost and risk associated.

    A small, one-time injection of cash is of no benefit whatsoever to farms that are facing endemic, year over year losses, and continuing increases in every cost associated with their business.

    I’m all in favor of conservation, but I think we do ourselves a huge disservice when it is promoted on a basis which is simply false. If we want to do something to benefit farmers we will need to ensure that they get a substantial and competitive return on their investment, compared with other options. Simply removing the other options does not do that.

    ——————————

    I understand the argument, and I can see why some would say that
    “the only thing worse than no easements is scattered easements in the wrong location, but I’m not sure I agree.

    If we had predators that require vast territories to survive, or huge migratory herds then there is more incentive to preserve large tracts of habitat for animals. In Northern Fauquier and Loudoun there are large contiguous spaces that have been set aside to preserve the acreage necessary for fox hunting.

    But, a large portion of the arguments we use for open space amount to preserving habitat for ourselves. I see no reason to put all that space in remote areas where we cannot enjoy it on a daily basis without getting in our cars and driving there.

    One of the largest benefits of conservation land is the effect it has on the value of neighbors. Scattered conservation land has more neighbors, and consequently creates more value. One way we can create more conservation land, and provide a stream of cash that actually will help the farmers, would be to recognize this fact, and then capture some of the neighboring gains to be transferred back to the farmers periodically.

    ——————————

    Finally, it is true that the 400,000 acres is only 1.6% of Virginia’s area. But that doesn’t include the state and national forests, parks and other lands set aside. Considering that only about 3% of land area is developed, and that all of our fruits and vegetables are grown on less than 2% of the land, we have, still, a lot of land that is used for more or less nothing. (This raises the question of why we thnk we need to aid farmers, maybe the best thing is to let them go out of business. You know, free market cuts both ways.) We don’t see it that way because we are possessed by the changes immediately around us, but in a larger sense maybe this is a big brouhaha over nothing.

  5. Groveton Avatar
    Groveton

    I recently saw a billboard in an airport that said governemnt entities in the US owned 1 out of every 3 acres of land in the USA. Isn’t this enough?

    Also, Jim, this is direct governemnt intrusion in order to change settlement patterns. I thought your philosophy was to let the free markets make the necessary changes.

    Ray Hyde is right – this does not benefit farmers.

    Finally, the figures I have are:

    Per Capita Income in Isle of Wight (2000)- $20,235 per year.

    Per Capita Income in state of Virginia (2004) – $35,477.

    Shouldn’t the governemnt of Isle of Wight be more focused on economic development than buying farms?

  6. Jim Bacon Avatar
    Jim Bacon

    Ray, if the voluntary plan didn’t benefit farmers, why would anyone apply to sell their conservation easements to the county?

  7. Ray Hyde Avatar
    Ray Hyde

    A bunch of reasons.

    In Fauquier a number of applicants have been elderly, with no children interested in the place, others have active farms but they also have other interests for support, so the farm isn’t their only asset. You can call these “partially altruistic” gifts.

    The payments might be enough additional incentive for some, who otherwise couldn’t quite afford the gift. For others, the gift would be made anyway, and the payment has bought exactly nothing.

    Peer pressure is an issue. I know of at least one case where neighbors have stopped speaking because of pressure applied. In fact, I heard that lawsuits were involved because one denied formerly allowed right of way to another. Even families have been split over this.

    Smooth talking salesmanship is another, and this is what I was objecting to. Just because we mean well is no excuse to lie about what is happening or fail to disclse the downside. Some people may THINK they have a benefit on account of the short term cash without properly reconciling the long term problems. If you think the Metro contract is loosey goosey and ill defined, just look at one of those conservation agreements.

    Finally, how long do you have to be trapped by regulations that offer no other possibility of change before your “choices” are no longer “voluntary”? If I’m 75 and I can’t see any fair economic way out, then I might as well take the money and have a nice vacation before I die on the farm.

    I can take solace in the fact that other taxpayers will pay more for all the eternity that I’m in eternity because of my “gift”.

    Seriously, some, including tax professionals and academics, point out that land use taxation results in higher taxes for all, even including some farms, because the improvements are taxed at full value.

    So we have this trichotomy. Some claim farms keep taxes lower because they pay more than their fair share in taxes and use less services. Others claim land use taxes area subsidy to the rich landowners, and cause higher taxes. Others claim that no matter which, it is still OK because it is better than development, which we all know, “doesn’t pay”.

    Which is it?

  8. Larry Gross Avatar
    Larry Gross

    I don’t think this has anything to do with farming nor should it.

    We don’t go around decrying the loss of family-owned pizza parlors nor do we seek laws and regs or advocat tax money spent that would “save” family-owned pizza parlors.

    Farming is an economic activity that has absolutely nothing to do with sprawl and land development but has been given as “the” reason for setting aside land from development.

    We should be honest about this.

    What people are advocating for is not farms – but vacant land – obstensibly because vacant land is better than leap-frog development.

    but.. advocating for “vacant land” would sound really, really bad – wouldn’t it… so you advocate for “saving farms” instead.

  9. Ray Hyde Avatar
    Ray Hyde

    Thank you, Larry. My point exactly.

    Now, why do people advocate for vacant land?

    – It makes their developed property more valuable.

    – It allows for less congestion.

    – It staves off enormous capital expenses for schools.

    – It doesn’t cost them anything.

    We should be honest about this. If we want conservation then we should be willing to pay the price to get it.

    If any other business goes under, they are allowed to sell the assets for what they can get, for whatever use someone has for them.

    So, if a farm goes out of business, what exactly is it that we are willing to let the owners do with the assets? Farm estates. Urban uses in the countryside.

    Aaargh.

  10. Larry Gross Avatar
    Larry Gross

    most farms are not near water-sewer nor commuter-grade road infrastructure – therefore.. in my view.. not very developable…

    .. as compared to land that IS water/sewered and near commuter-grade road infrastructure.

    How many Haymounts do we see proposed (which is privately water/sewered and 15 miles from the nearest commuter-grade road) verses projects that ARE water-sewered and quite near commuter-grade infrastructure.

    and .. to be honest.. such projects cannot be truly called “leapfrog”.

    If one thinks about this… “leapfrogging” over land that is water/sewered to land that is not… is quite a tough deal… if you are a developer… unless of course -you could build your own water/sewer or get a sweet deal from the locality to extend it.

    but farms.. turned into subdivisions… so we convert them to conservation easements instead?

    ha ha ha ha ha ha… who is being fooled here?

  11. E M Risse Avatar
    E M Risse

    Groveton:

    The Billboard covers the whole US of A. The “West” and Alaska is where most of the “government land” is located.

    Virginia has only a small percentage of public land compared to other states with as much size and as much forest. We do the numbers in “Quantificantion of Land Resources and the Impact on Land Conservation,” a Backgrounder at db4.dev.baconsrebellion.com

    Larry:

    You make several good points. Your oft repeated suggestion about the need for real “Comp Plans” at the Regional scale to identify the best places for urban land uses and for nonurban land uses is the key.

    More on this in a post soon.

    EMR

  12. Ray Hyde Avatar
    Ray Hyde

    I thought you were on the right track the first time, Larry. Now I miss your point entirely.

    If someone is willing to build private water and sewer, what is your problem with that? (Naturally there are continuity and maintenance issues, but the city has those problems, too.) Set the standard, require a performance bond, and then step back. Eventually the individual systems can be annexed (At the appropriate price, of course.)

    If you require water and sewer, then you either need to be ready to make it available, or else allow someone else to, if they will do it at their own expense. To require it, and then disallow it or make it unavailable is hypocrisy.

    Rtes 55 and 66 plowed through thousands of acres of farms, and nearby to tens of thousand more, partially at the farm’s expense. Now we want to prevent them from development because they don’t have commuter grade highways? Or is it the sewer they don’t have?

    Instead of building commuter grade facilities, how about directing a few commuter grade jobs?

    In Fauquier there is a case where a man with undeniable building “rights” wants to use them, according to county rules, to build a handfull of homes grouped together on a small portion of a much larger property.

    In order to do that he will place most of the remainder in easement, according to county rules.
    Despite all that, the county is going to fight him tooth and nail over a sewer issue which is an engineering problem, not a social problem.

    The county has a development rule that REQUIRES leapfrog easements and PODs of development, IF they will let you obey their rules.

    In Warrenton, Marshall, and Middleburg the towns are each going to require a single new developer to repair years of deferred town maintenance as a condition of going forward with much needed new development.

    What can you do? You either allow these guys to do SOMETHING with their property, or you don’t. If you do, then you wind up like Fauquier with an easement here and an easement there depending on who succumbs to the pain first. Those easements will be interspersed with PODs of varying sizes.

    It is in the comprehensive plan. And the zoning regs.

    What is your other choice? Don’t let them do anything. Under EMR’s scenario the price will drop until you can afford to farm it. Instead, each farmer will sell it at a lower price to a bigger fool, because we don’t need the produce. The only outfits that can buy it are the giant agribusinesses we all hate.

    Why would you prevent them from doing anything? It’s more efficient and cheaper to provide services to the core, allegedly. Now what you are doing is holding their land in inventory until it is either needed for crops and cattle, or until the clear edge crawls out to it.

    Except you are not holding it: you are forcing them to hold it for you, because it is to your economic benefit to do so (and you don’t like scattered PODs). But if it really is to your (our) economic benefit then it shouldn’t be too hard to rationalize sharing that benefit with those that make it possible.

    Lets face it. EMR says that we can accomodate decades more growth, just in Fairfax county. If that’s the case then the argument holds in spades for all of Virginia. Taking away substantially all the rules won’t result in limitless sprawl. We don’t need that many houses any more than we need that many farms.

    Builders would snap up the best places and compete until home prices fall. At a low enough price, builders won’t be able to AFFORD to build their own water and sewer, any more than farmers can afford to build their own combines.

    In short, we can’t credibly argue, on the one hand, that Fairfax has room for all our forseable development, and at the same time claim that unchecked development will fill the countryside.

    Hee is the real problem. Farms experience pain in large sudden doses. How do you make a comprehensive plan that accomodates the random needs generated by strokes on the part of our aging farmer population?

    You can let them do something, and deal with the scatteration consequences. You can let them do nothing and pay them in order to share the development wealth and the “savings” from compact development, this has the added benefit of keeping them on the land. You can buy the land and preserve it at your own cost. What other options have I missed?

  13. Ray Hyde Avatar
    Ray Hyde

    Here is a mind experiment. Consider the example of Warrenton, Marshall, or Middleburg, wherein new development is going to make up for (and pay for) years of deferred maintenance and neglect.

    Suppose those towns did not exist. Suppose you had to build everything that now exists and is planned to exist from scratch, starting tomorrow, and all those costs would be allocated to the homes that will be built, starting tomorrow, to replace all the ones we hypothetically dismissed along with all the new development planned, again, starting tomorrow.

    When we are done, all the people presently there and all the new people coming would move in at once.

    How would you allocate the costs?

    Would the previous residents have higher or lower taxes with all the costs shared equally from scratch?

    Would you get lower taxes the closer you are to the core? Would you allocate taxes based on distances from the indivisual service sites? One tax based on distance to the treatment plant, one based on distance to the water tower, one based on distance to the fire station, one based on distance from the police station, etc?

    Oh yeah, and one more tax based on how far they have to drive to enjoy the land that was preserved.

  14. Larry Gross Avatar
    Larry Gross

    Ray – you might be confusing my attitudes with regard to our policies with regard to land development and my attitudes with regard to the responsibilities of developers and landowners who wish to develop their land.

    I’m not in favor of land-use policies that themselves are dysfunctional but anyone who wants to develop land and that development has impacts outside the boundaries of their parcel – then other landowners and taxpayers are impacted and involved and the “right” to develop your land ends – at the boundaries of your property.

    If you want to discharge treated sewage into a creek or river – then you are impacting something that does not belong to you and the costs of doing so – are legitimately .. yours.

    Ditto with other things.. roads, schools, ems, etc – these services and infrastructure needed as a consequence of the development of your land are also your legitimate costs (or passed on to those who buy subdivided parcels).

    If others are going to agree to pick up some of the costs – then it is indeed their decision.

    To have a law that forces neighbors – taxpayers to pick up the infrastructure costs of other landowners who have decided to convert their land to money – is wrong – no matter how it was done in the past – in my opinion.

    This is a separate deal from any government or any individual or any group of individuals advocating for what they think is “smart growth” or “save the farms” can be implemented on the backs of existing landowners by limited THEIR rights to develop.

    But those “rights” still require equity with regard to others rights.

    That’s my “take”.

    and if we want to claim that other taxpayers should be made to pay for the infrastructure for the property you wish to develop then you may well see laws/regs to restrict the development of your property.

    Can’t have it both ways….

  15. Ray Hyde Avatar
    Ray Hyde

    I agree to some extent, but to me that extent is modified by the belief that the “right” to prevent development also ends – at the boundaries of your property.

    I never suggested that you should be allowed to discharge untreated sewage. What I suggested is that the government set standards, and leave it at that. Any method that meets the standards ought to be allowed.

    I agree that “To have a law that forces neighbors – taxpayers to pick up the infrastructure costs of other landowners who have decided to convert their land to money – is wrong – …” but I’m not convinced that is what we have, entirely. I don’t buy the idea that development doesn’t pay, for one thing. I think the measures used to make that claim are just wrong. I think that a lot of the infrastructure costs allcated to new construction are actually deferred costs that should have been paid for by earlier residents long ago.

    I think this is a false and selfish claim on the part of some which is actually designed to force neighbors to pick up the costs of infrastructure which is being hoarded by those who have already developed, and the costs of infrastructure for which we do not yet charge, green infrastructure if you will.

    ———————————-

    Recently, I had a conversation with a gentleman about universal health care, which he opposes. He claimed the only way to make it work was to let private enterpise work it out.

    He also wanted me to come and cut hay on his property. I told him there wasn’t enough money in it, that I couldn’t afford to take the job, unless he paid me to come and harvest his land, in effect subsidizing me.

    He was initially shocked, yet he agreed to my proposal, especially when I pointed out to him that there was a lot more needed here than merely cutting hay: the whole place needs to be re-established.

    But, I said to him, your place is under easement. Why would you go to the expense when your tax break is guaranteed? “Well, this area is so nice I want to see it stay that way, and keep it in farming.”

    Well, I said, easements don’t gurantee farming, profits do, its the same problem with healthcare. I can mow some other farms just for the hay, but they have healthy hay, their fields are flat, and the hazards are well marked. Call it cherry picking if you like. But let’s be frank here, what you are really getting from me is large scale landscaping services to make the place look nice. And, after a while, we will be able to make a little bit, to defray some of the costs. We can probably turn an operating profit, if we don’t count the land costs.

    We made a deal, and here is at least one person willing to pay for green infrastructure.

    ——————————–

    I can’t agree that the competition between rights is a separate deal. These are different sides of the exact same coin. I can’t possibly see how it is a fair deal if one side gets to avoid costs, perpetually, by denying profits to the other side, perpetually.

    If this was truly a matter of paying for infrastructure, then the way to proceed is put a price on the infrastructure, and then get out of the way. That isn’t the case and you know it, what is really happening is that development is prevented on the basis of “preserving lifestyle”. That lifestyle is supported by open space that is not owned by those that enjoy the lifestyle, and therefore this boils down to a matter of greed – on both sides of the coin.

    I’m perfectly willing to agree to any kind of development scheme where developers pay their full costs, but it needs to be balanced by a scheme wherein antidevelopers also pay their full costs. At present, such schemes are only in their infancy, but I believe they are a sure to happen as you are that congestion charging will happen: in fact, I think the ideas are very similar – they both charge for space.

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