COUNTY OF SAN MATEO

ENVIRONMENTAL SERVICES AGENCY

 
 

Date:

February 7, 2002

   

Set Time:

9:30 a.m.

   

Hearing Date:

February 26, 2002

 
 

To:

Honorable Board of Supervisors

 

From:

Marcia Raines, Director of Environmental Services

 

Subject:

Consideration of an amendment to the San Mateo County Board of Supervisors Resolution No. 44396 (Williamson Act) to include the provision for establishment of Farmland Security Zones.

 
 

County File Number:

PLN 2001-00800 (County Planning Division)

 
 

RECOMMENDATION

 

Adopt the resolution to amend Resolution No. 44396 (Williamson Act) to include the provision for establishment of Farmland Security Zones included as Attachment A.

 

PROPOSAL

 

An amendment to the Board Resolution No. 44396 (Williamson Act) to include the provision for establishment of Farmland Security Zones. The California State Legislature amended the Williamson Act in August 1998 to provide for the establishment of Farmland Security Zones. This proposal seeks to establish a structure for implementation in San Mateo County of the State Legislature's amendment to the Williamson Act.

 

BACKGROUND

 

Report Prepared By: Miroo Desai Brewer, Project Planner, Telephone 650/363-1853

 

Applicant: County Planning Division

 

Location: County-wide

 

DISCUSSION

 

A.

PLANNING COMMISSION ACTION

   
 

On January 9, 2002 the Planning Commission considered the project and unanimously recommended that the Board of Supervisors adopt the resolution to amend Resolution No. 44396 (Williamson Act) to include the provision for establishment of Farmland Security Zones.

   

B.

BACKGROUND

   
 

In 1965, the California State Legislature enacted the California Land Conservation Act of 1965, commonly referred to as the Williamson Act. The purpose of the Williamson Act is to preserve a maximum amount of the limited supply of agricultural land that is necessary to California's agricultural economy and to assure "adequate, healthful and nutritious food for future residents of this state and nation."

   
 

Under the Williamson Act, an owner of agricultural land may enter into a contract with the County whereby the landowner agrees to restrict the use of the land to the production of commercial food or fiber for a term of not less than ten years. Depending on the quality of agricultural land and its location from urban areas and rural service centers, a landowner can enter into one of two kinds of contract: Class A or Class B. The term of the contract is automatically extended each year unless a notice of cancellation or non-renewal is given. Certain uses compatible to agricultural production are also permitted. In return, the landowner is taxed on the capitalization of the income from land and not on the fair market value.

   
 

Since the passage of the 1965 Act, changed conditions have made traditional Williamson Act contracts less attractive to the owners of the State's agricultural lands. It became apparent that owners of prime agricultural land and land used for high-value crops may not realize tax reductions under traditional Williamson Act contracts sufficient to justify restricting their land to agricultural purposes. This is due to the method of calculation of value under the Williamson Act and due to the passage of Proposition 13. Land subject to a Williamson Act contract is valued on a yearly basis according to its income-producing ability. In general terms, the County Assessor values the land by taking the fair rental value based on typical rents received in the area for similar land, as well as the actual rent being paid on the subject property. Then the fair rental value is divided by a capitalization rate specified by law. In many areas, the rental value of agricultural land meets or exceeds the unrestricted factored base-year value of land. In such cases, the landowner will derive minimal benefit, if any, from entering into a traditional Williamson Act contract. Further, in 1978, California voters passed Proposition 13, which made property taxes dependent on acquisition value rather than its fair market value. Consequently, owners of farmland that had not changed hands for many years already enjoy a low factored base-year value, which in many cases turns out to be lower than the Williamson Act value.

   
 

These are some of the reasons that reduced incentives to place land under the Williamson Act and that led the State Legislature, in August 1998, to amend the Williamson Act and provide for establishment of "Farmland Security Zones."

   

C.

KEY CHARACTERISTICS OF FARMLAND SECURITY ZONES (FSZ)

   
 

Below is a list of requirements that must be met in order for a property to be placed into a Farmland Security Zone (FSZ) contract:

   
 

1.

Land must be currently in a Williamson Act contract.

     
 

2.

The landowner must make a request to be placed under a FSZ contract.

     
 

3.

To qualify, land must be designated on the Important Farmland Series maps as predominantly on or more of the following: (a) prime farmland; (b) farmland of Statewide significance; (c) unique farmland; and (d) farmland of local importance.

     
 

4.

Any land located within a city's sphere of influence may not be included in a Farmland Security Zone, unless expressly approved by resolution by the city with jurisdiction within the sphere.

     
 

5.

Unlike Williamson Act contracts, Farmland Security Zone legislation provides that the FSZ contracts be for at least a 20-year period.

     
 

Land subject to an FSZ contract is valued for assessment purposes at 65 percent of the value of its Williamson Act value, or its Proposition 13 value, whichever is lower.

   

D.

FISCAL IMPLICATION FOR THE COUNTY

   
 

Under the current statute, counties are paid $5.00 per acre for prime agricultural land and $1.00 per acre for non-prime agricultural land for properties under Williamson Act contracts in subvention funds by the State to assist in offsetting taxes lost. Properties under the Williamson Act that are within or within three miles of the sphere of influence of an incorporated city will have the subvention dollars increased to $8.00 per acre for contracts converted to Farmland Security Zones.

   

E.

REVIEW BY AGRICULTURAL ADVISORY COMMITTEE

   
 

The proposal was reviewed by the Agricultural Advisory Committee at their August 13, 2001 public meeting. The Committee has recommended approval of this proposal.

   

VISION ALIGNMENT

 

The proposal to amend Board Resolution No. 44396 to include the provision for establishment of Farmland Security Zones keeps the commitment of Preserving and Providing People Access to the Natural Environment and Goal Number 14: Preserve and enhance the important natural resources through environmental stewardship. The proposal contributes to this commitment and goal by providing tax incentives for bringing more of the County's agricultural lands under agricultural preserves.

 

ATTACHMENT

   

A.

Proposed Resolution Amending Resolution No. 44396 concerning the California Land Conservation Act and the Planned Agricultural District to include the Farmland Security Zone Program.

   
 

MR/MDB:cdn - MDBM0185_WCU.DOC