| Isabella County Farmland Preservation |
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Purchase of Development Rights (PDR) Information
What is a PDR Program? |
Purchase of Development Rights Program
Q. If I sell my development rights to the county in exchange for a permanent agricultural conservation easement, do I still own the land? A. Yes. You are simply insuring that your farmland will be preserved for future agricultural use and generations. You still own the farm and may continue to enjoy its use.
Q. What is an agricultural conservation easement? A. An easement is a right. A “preservation easement” is a recorded document that limits that type and amount of development that may occur on a property. You may own a particular farm property “fee simple,” meaning that you have all right to occupy, use, and enjoy the land. One right that you have is the right to develop that property for commercial, residential, or other uses as prescribed in your Township’s zoning ordinance. When we say that we would like to purchase an agricultural conservation easement on your property, we mean we would like to purchase only the development rights associated with farm parcels so that they are preserved as farmland for the future.
Q. Why should I sell my development rights to the county? A. Landowners have chosen to participate in the program for many reasons. Some farmers do not plan to develop their property, and appreciate the ability to access some of the land’s equity while continuing to farm. Proceeds from easement sales have been used, for example, for the payment of debts, or to finance needed capital investments. If you intend to pass the farm on to heirs, selling your development rights may offer special tax advantages. Only you can determine if the benefits of the program will work for you and your family.
Q. Is there a market for deed restricted farmland? A. Yes. Due to its relatively low cost, there is a high demand for deed-restricted farmland among established farmers looking to increase their landholdings and new farmers who want to purchase affordable farmland. Some participants in the program have sold their development rights as a first step to selling the farm.
Q. How do you determine the value of my development rights? A. The easement value of your farm is affected by a number of variables including location, zoning, road frontage, soil types, and development pressure. To determine the easement value, a state-certified appraiser will be hired to appraise the property. The appraiser values the fee simple or “before easement” value of your land and it’s restricted or “after easement” value. The difference between the two values is the appraised value of your “development rights,” or what the County will pay you for your agricultural easement. For example: Before easement = $3,000 per acre, Value of land unrestricted After easement = $1,200 per acre, Value of land restricted Payment = $1,800 per acre, Value of development rights (The price the county would pay to preserve the land)
Q. If I sell my development rights to the county will the public have the right to come on my property? A. No. The public is not granted any right to use your land. County elected officials remain strong proponents for the strengthening of right-to-farm laws and ordinances to protect farm properties that are preserved under the program. This will help to further strengthen your protection from public violations of your rights as a landowner.
Q. When would the county buy my development rights? A. The County reviews all of the applications submitted by the application dealing. Following preliminary approval, it is anticipated that landowners will be made an offer within six months. Once a contract of sale is executed, the easement sale will close within approximately six months. In the event that a large number of applications are received, the appraisals and, consequently, offers would be done in batches so the timeline might be slightly longer.
Q. What happens after I submit my application? A. All applications are reviewed to determine their relative ranking according to the counties adopted selection criteria. The criteria include soil classifications, parcel size, surrounding land uses, proximity to existing livestock farms, development pressure and more (see attached selection criteria). Based on the results of the ranking, the County will determine which applications will receive preliminary approval. Approved farms are then appraised in order to determine their easement value.
Q. Am I required to accept the county’s offer? A. No, the Purchase of Development Rights Program is entirely voluntary. After you are informed of the offer you can either accept the value or reject it and “walk away”. It is up to you.
Last updated on 04/11/06. |
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