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NR 2006-26
October 25, 2006

Contact: Ed Wilson
Don Drysdale
Carrie Reinsimar
(916) 323-1886

`WIN-WIN PROJECT’ PRESERVES FARMLAND,
ALLOWS CITY OF LATHROP TO EXPAND

Read Additional Comments About This Project

SACRAMENTO – An unusual agreement between state and local governments and a land developer will allow the City of Lathrop to expand while also shielding outstanding farmland from development. This “real world” solution – involving the state Department of Conservation (DOC), the city and Richland Planned Communities -- could help set a tone for future development projects and land-use planning throughout California.

“This project is an excellent example of how parties that sometimes have different goals and agendas can work together to benefit Californians,” said Mike Chrisman, California Secretary for Resources and a fourth-generation rancher. “Meeting urban needs sometimes can become complicated and contentious when farmland conversion is at stake. But in this case, the parties came to a mutually beneficial arrangement. It’s a win-win project. Richland Planned Communities deserves a great deal of credit for doing things the right way.”

Under the agreement, known as a Williamson Act Easement Exchange, the developer donated 927 acres of farmland to the Central Valley Farmland Trust. The “Mainstone” property – south of Lathrop near the Deuel Vocational Institute -- has been placed into an agricultural conservation easement and can never be developed.

In exchange, a Williamson Act contract on 308 acres of farmland closer to the community was cancelled, allowing development to take place. That property essentially will become a downtown for the San Joaquin County community. Plans include a community center, the city’s first high school, a community park, businesses and housing, with Richland as the developer.

“Typically, Williamson Act cancellations involve the loss of farmland,” noted DOC Director Bridgett Luther. “Ideally, we’d prefer that Williamson Act contracts be allowed to run their course and that development be directed away from farmland. But we understand that there are difficult choices and compromises in the real word. So this exchange is a real-world solution that benefits everyone.”

Nearly 17 million acres of the state’s 45 million acres of farm and ranch land are enrolled in the Williamson Act, which was established in 1965 and is overseen by DOC’s Division of Land Resource Protection. Through the Act, landowners receive property tax incentives in exchange for a commitment to keep their land in agricultural use for a minimum of 10 years. The Act is estimated to save agricultural landowners from 20 percent to 75 percent in property tax liability each year. Those tax savings have been important to the economic viability of many agricultural operations around the state.

The California Supreme Court has established that the preferred method for ending a Williamson Act contract is non-renewal. Once a landowner opts out, the contract winds down over a 10-year period

and the property taxes rise incrementally. A landowner can petition to cancel a contract early, but a local government must make specific findings backed by substantial evidence to approve the cancellation. If the contract is cancelled, landowners must pay a fee equal to 12.5 percent of the unrestricted, fair market value of the property. That fee goes into the state’s General Fund; it isn’t specifically earmarked to protect agricultural land or to be used locally.

However, the Williamson Act Easement Exchange Program keeps cancellation fees working in the local area to preserve agricultural land instead of going to the general fund. In an exchange, as the Williamson Act contract is cancelled on one parcel, a permanent agricultural conservation easement is created on another parcel of equal or greater size and value.

This was only the fifth Williamson Act easement exchange since the program’s inception in 1998, and the largest in terms of acreage.

“Our easement exchange program offers a way to protect farmland, which is an irreplaceable resource, even as we address development needs,” said Brian Leahy, chief of the Division of Land Resource Protection. “We applaud Richland’s decision to utilize this option.”

Although California leads the nation in agricultural production, farmland is being converted rapidly for other uses. Nearly 54,000 acres of irrigated farmland were taken out of production around the state from 2000-02, according to DLRP, and nearly 93,000 acres of land were urbanized.

“The Williamson Act is designed to protect farmland from urbanization, and it has a tremendous track record of doing that,” Luther said. “Some parties see it as just a speed bump in the path of development, but it can and should be used as a land-use planning tool. The work we’ve done with the City of Lathrop and Richland can be a template for other communities and developers in California.”

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