An Overview of the Purchase of Development Rights (PDR)

Farmland Protection Program


The Town of Bayfield

Background: Apple orchards are the backbone of the Town of Bayfield's agricultural industry. Other agricultural pursuits include the growing of berries, other tree fruits, flowers, nursery perennials, vegetables, and Christmas trees, as well as some beef, dairy and honey production. For more than 100 years this agricultural activity has contributed not only to the local economy, but also to the quality of life, as it has to a large extent defined the rural character and landscape of the community. The Town of Bayfield seeks to protect this agricultural heritage from the pressures of recreational sub-division and residential development which competes with local agricultural interests for open land.

In 1995, after much study and citizen input, the Town of Bayfield adopted a Land Use Plan intended as a vision statement to guide future development within the Township. Goal #1 from the Land Use Plan is to: "Preserve productive and potentially productive agricultural land (with special emphasis given to microclimate fruit industry) and to maintain agriculture as a major economic activity and way of life." One of the stated objectives for this goal is to "discourage residential development of potentially productive agricultural land."

Purchase of Development Rights (PDR): An effective approach to preserving farmland, increasingly being used by rural communities since the 1970’s, is purchase of development rights (PDR). Development rights are a landowner’s rights to develop, or subdivide, his or her property. Often compared to mineral rights, development rights can be separated from a landowner’s property. PDR is a voluntary farmland protection technique that compensates landowners for limiting future development or subdivision of their land. Under a PDR program, an entity, such as a town or private organization, purchases development rights to a piece of property. By doing so the organization or government is essentially buying the landowner’s right to develop that land. The land itself remains in private ownership and the landowner still retains all other rights and responsibilities associated with being a property owner.

When a landowner sells his or her development rights, a legal document known as a conservation easement is created to restrict in perpetuity the use of the land to farming or open space. A conservation easement permanently limits residential, commercial, or industrial development of a property in order to protect its conservation or agricultural values. Easements can be designed to meet the individual financial or personal needs of each land owner The easement is attached to the landowner’s deed and stays on the deed even if the land is sold or passed on through inheritance, thereby assuring that development or subdivision will not occur on that particular property.

In April of 2000, the Annual Town Meeting of the Township provided a mandate for the Town of Bayfield Board of Supervisors to develop and implement a Farmland Preservation Program, including the purchase of conservation easements (i.e. purchase of development rights, PDR), and directed the Town Board to levy taxes as necessary to provide funding for this program. Subsequently, the Town Board appointed a citizen committee to develop a plan and advise the Board regarding Farmland Preservation. At the same time the Board created a designated annual fund of $10,000 as a commitment to a Farmland Preservation Program.

After two years of study, the Bayfield Township Farmland Preservation Committee recommended that, as a beginning, a goal be established to protect 500 acres of prioritized Bayfield Township farmland over a three year period, representing approximately 14 separate parcels, averaging 37.5 acres in size, with a total estimated easement-value of approximately one million dollars.

Funding Formula: The Farmland Preservation Committee was informed by the USDA-Natural Resource Conservation Service-Farmland Protection Program (FPP) administrator in Madison that a three-year application opportunity for Federal funding for agricultural easement purchases (PDR) is now available. The USDA-NRCS Farmland Protection Program will provide 50% of the cost for local municipalities and land trusts to purchase conservation easements for the purpose of protecting unique agricultural parcels from subdivision and non-agricultural development. The Town of Bayfield's Farmland Preservation Program could receive $500,000 or more from this current Federal funding initiative.

The Town of Bayfield Board of Supervisors approved a funding formula plan that would combine several sources to make up the required local 50% match to obtain Farmland Protection Program grant money. Under the plan, land owners making an application would be expected to provide at least 10% of the match (5% of total cost) by accepting a negotiated buy-out price below the appraised value of their parcel easement. Area foundations and contributors will be challenged to provide 30% of the local match (15% of total cost), and the Town of Bayfield would raise 60% of the match (30% of total cost).

Farmland Preservation Committee: The Farmland Preservation Committee is appointed by the Town of Bayfield board of supervisors. It serves as a program planning and advisory group. The Committee is made up of nine members, two of which are also elected members of the Town of Bayfield Board of Supervisors. Five of the committee members are active farmers and four committee members are non-farmers. The Director of the Bayfield Regional Conservancy (BRC) and the Regional Director of the United States Department of Agriculture-Natural Resource Conservation Service (USDA-NRCS) provide an advisory role to the committee.

Community Partnerships: A partnership has been formalized between the Town of Bayfield and the Bayfield Regional Conservancy (BRC) for the express purpose of administering agricultural conservation easements purchased by the Town. Farmland preservation is an expressed part of the mission statement of the BRC. The Conservancy has experience in the purchase and monitoring of conservation easements, as well as an office and a professional staff person to facilitate this activity.

The USDA-NRCS has agreed to provide support by interpreting the soils to be found on applicant parcels, and offering an evaluation of potential agricultural use of applicant parcels based on soils, microclimate, size, and crop history.

Criteria to Set Acquisition Priorities: Largely patterned after the successful criteria developed by the Town of Dunn in Dane County, WI, The Town of Bayfield Farmland Preservation Committee developed and recommended a 100-point-score criteria for ranking PDR applications. This ranking criteria has been approved by the Town of Bayfield Board of Supervisors.

Major provisions of the criteria address 1) the quality of the parcel as farmland; 2) development pressure on the parcel; 3) financial & funding considerations; 4) scenic, environmental, and historical qualities; and 5) other considerations such as proximity to other protected lands, location, and wait-time of the application.

Application Review Committee: A PDR Application Review Committee, defined as an independent standing committee that is comprised of the Town Chairperson, another member of the Town Board, a resident citizen appointed by the Town Board, a resident citizen appointed by the Conservancy, and the Bayfield Regional Conservancy Director, has been formed to review all applications, score applications by the Town's established criteria for ranking, and make recommendations for purchase to the Board.

The Application Review Committee will employ the expertise of a certified appraiser to establish easement values, the expertise of a USDA-NRCS soil scientist to evaluate the parcel's potential as productive farmland, and the expertise of the Town Attorney for legal detail & questions and to draft documents pertaining to any sale. The PDR Application Review Committee is separate and independent from the Farmland Preservation Committee which has a advisory & program planning function only. Final approval for the purchase of an easement would be made by the Town of Bayfield Board of Supervisors.

Response from Farmland Property Owners: A recent informal survey of active farms within the Town of Bayfield identified 13 landowners, representing 690 acres, who expressed an interest in making an application for the sale of their development rights to the Town. While it would be expected that some of these respondents would delay in making an application, or would not apply, it could also be expected that there would be applications from landowners not included in the survey. Five applications have been submitted thus far in 2002, and additional applications in 2003 are very likely. It is expected that the number of applications will increase for 2004 and beyond if the easement purchases in the introductory years of the program prove successful.