Ingham County Farmland and Open Space Preservation Board

INGHAM COUNTY FARMLAND AND OPEN SPACE PRESERVATION BOARD

P.O. Box 319,Suite 104, HilliardBuilding,Mason, MI 48854 Ph: 517.244.7197 Fax: 517.676.7358

Members

Dr. Paul K. Kindel, Chairperson Dr. Kirk Heinze

Wendy Villarreal

Gabriel Biber, Vice-Chairperson Jeanie Igl

Gabriel Biber

Dr. Kirk Heinze, Secretary Dr. Paul K. Kindel

Laurie Koelling

Laurie Koelling, Treasurer Randy Maiville

Todd Eldred

To:Interested Landowner

From:Ingham County Farmland and Open Space Preservation Board

Date:April to Friday, June 30, 2017 (open application period)

Re:Request for Information on County PDR program and a PDR application

We are pleased with your interest in the Ingham County Farmland and Open Space Preservation Program. The following enclosed items will provide you with information about the program:

Ingham County Open-Space Preservation Application Form

Parcel Worksheet

Steps to Completing the Ingham County Purchase of Development Rights Application

What is a PDR Program?

Ingham County PDR Program: Potential Questions and Answers

Selection Criteria for Open Space Land Preservation Program

After reading the enclosed material, fill out the application and send it to the following address along with all related material by the application deadline of Friday, June 30, 2017 at 11:00 a.m.:

Ingham County Purchasing Department

c/o Farmland and Open Space Preservation Board

121 E. Maple Street 2nd Floor

P.O. Box 319

Mason, MI 48854

Applications must be received in a sealed envelope!

The Farmland and Open Space Preservation Board will host a work session for landowners who wish to apply to the County PDR program and want additional assistance filling out the application. You will receive a postcard in the mail notifying you of the date, time and location of the workshop. The Ingham County Farmland and Open Space Preservation Board will score and rank all applications received. After all applications have been scored, you will receive notification of the status of your application.

Again, we are delighted with your interest in the Ingham County Farmland and Open Space Preservation Program. Contact the Board office by e-mail at (e-mail is preferred) or Stacy Byers at (517)244-7197, or Jessica Huegli at , (517) 676-7207, or Christian Smith at , (517) 862-1559 if you have any questions.

Steps to Completing the

2017Ingham County Purchase of Development Rights

Application

Application Deadline: Friday, June30, 2017 at 11:00 a.m.

Step 1:Read through all materials. Many of the questions you may have are answered in the written material provided. This section will give you a background of the PDR Program in Michigan.

Step 2:Fill out the application as best you can. Be sure to print clearly. If you don’t know answers to some of the questions, simply indicate you are unsure. However, the more information we have, the better, even if you are unsure whether it is pertinent or not, it will still be helpful. You will be asked to provide supporting documentation such as recent tax bills for a current legal description. Be sure to include all applicable documentation before submitting the application.

Step 3:Items to be submitted with the application

Current tax bill for all applicable parcels

Completed Parcel Worksheet

Copy of PA 116 contract number (if applicable), wetland verification (if applicable)

Before you turn in the application make sure you have……….

Signed the application in all applicable places.

Included a current tax bill for all applied parcels.

Application Deadline: Friday,June 30th, 2017 by11:00 a.m.

Ingham County Purchasing Department

c/o Farmland and Open Space Preservation Board

121 E. Maple Street, 2nd Floor

P.O. Box 319

Mason, MI 48854

Applications must be received in a sealed envelope!

A purchase of development rights (PDR) program is a means of compensating landowners for their willingness to accept a deed restriction on their land that limits future development of the land to preserve its natural and open space value. Landowners are compensated for the fair market value of their land, based on the difference between what it can be sold for on the open market with no restrictions and what it can be sold for once an easement is placed on the land. State certified appraisers determine these values and the agreement is negotiated on an individual basis with the landowner in a willing seller, willing buyer atmosphere.

Permanent protection of natural land – community benefits from the increased resiliency and health of local ecosystems, stable land use patterns, fewer infrastructure needs, lower cost of community services and from enhanced rural character.

Participation is completely voluntary and landowners receive fair market value for development rights. All private property rights remain intact.

Cash from sale of development rights can be used for reducing debt, managing the land, college educations, retirement, etc. Proceeds from easement sales are often recycled back into local economy.

Landowner can access portion of land equity while still maintaining ownership and use of land and without having to sell it for development.

Property taxes and inheritance taxes based only on residual value of the land rather than the full developmental value.

Landowner can still borrow against reduced equity in their land. Other states’ track records show remaining land retains excellent (and increasing) resale value.

What is Open Space?

Open space means different things to different people. For the purposes of the Ingham County Open Space Preservation Program, open space land is natural land or farmland or a combination of these. Natural land is undeveloped, uncultivated, non-agricultural land. Farmland is land used for agriculture. Open space land may be public or private.

Why is it important to conserve open space land?

Natural open space lands have functioning natural ecosystems that yield clean air and clean water. These lands also allow native plant and animal to thrive. In addition they provide recreational opportunities, such as hunting and wildlife observation, and aesthetic beauty. Protection of farmland allows the agricultural industry to thrive thereby providing local food and local jobs. Protecting these types of land enhances the quality of life for all citizens of the county.

How is Open Space Protected?

Open Space land is protected by placing a conservation easement on the land in perpetuity. Landowners are compensated for the fair market value of their land, based on the difference between what it could be sold for on the open market and no restrictions for development purposes, and what it can be sold for with development restrictions. After an agreement is reached with the landowner, a conservation easement is executed, protecting the land for future generations. Once the easement is in place, the landowner still owns the land, retains all private property rights, can sell the land or pass it onto heirs, and has been fairly compensated for not exercising the development rights.

What Is a Conservation Easement?

A conservation easement is a written legal agreement between a landowner and

a government entity or land conservancy(a private, non-profit conservation organization) thatpermanently restricts a property’s uses to protect its conservation values.

Landowners own many rights associated with their property, such as the rights to harvesttimber, build structures, and so on. Each of these rights has a monetary value that can beestablished by real estate appraisers and is recognized by the Internal Revenue Service(“IRS”). When landowners (also called “grantors” or, in some cases, “donors”) donate orsell an easement to a land trust or municipality (also called “grantees” or “easementholders”), they continue to own the property and pay taxes on it, but theypermanently give up certain, agreed-upon rights.Compare: When landowners convey property in “fee simple,” they transfer all of theownership rights.For example, the landowner might give up the right to build additional houses, whileretaining the right to harvest crops. If the landowner has children who may want to liveon the property in the future, or if the landowner is not willing to give up all future buildingrights on the property, an easement could “carve out” from the development restrictions alimited number of building lots called “exemptions” that could be built on it in the future. Under this limited (or conservation-based”) development scenario, easements would be placed on the most scenicand environmentally sensitive areas.

The easement also might require the landowner or theeasement holder to take certain actions, such as restoring a stream bank or removinginvasive vegetation.Future owners will be bound by the terms of the easement, which is recorded at the County Register of Deeds Office. The holder of the easement takes on the legal responsibility and right toenforce the easement. If a future owner or other person violates the easement – perhaps bybuilding a structure the easement does not permit – the easement holder will work to havethe violation corrected, if necessary, through legal means.

What are the property tax implications of accepting a Conservation Easement?

Income tax: If the landowner donates or partially donated the value of the conservation easement to the accepting organization, the donor may be eligible to take a deduction on their federal income tax. As long as certain Internal Revenue Service Requirements are met, the reduction in market value attributable to a donated easement may be considered a charitable donation that makes the landowner eligible for a federal income tax deduction and estate tax benefits. Consult a tax advisor about such a donation.

Property tax: Since the property that has a conservation easement on it cannot be fully used or developed as zoning would otherwise allow,its market value is lessened. This, in turn, may lower the assessed value of the property, which could have positive tax consequences for the owner.

Rights Typically Retained by Landowners

As noted above, the landowner continues to own the land conserved by aneasement andretains many rights of use. An easement document might specify, for example, that theowner reserves the right to:

• use, maintain, and expand an existing residence;

• manage woodlands for timber production or conduct a Christmas tree operation;and/or

• all other rights and enjoyment of the property.

Restrictions Typically Placed on Properties

A landowner’s use of property conserved by an easement might forbid or limit:

• excessive signage;

• commercial, industrial, and mining activities;

• new buildings, except for those specifically negotiated in advance;

• subdivision; and/orcommercial recreational use (this prohibition is required to obtain federalestate tax benefits).

Will you respect property rights?

The Ingham County Open Space Program respects private property rights and

local jurisdictions and will only work with willing landowners, communities and partners to promote voluntary open space protection.

Why would landowners voluntarilyrestrict their property rights?

The primary reason is that they love their land. Although they might be

responsiblestewards of their property, they generally have no control over what subsequent ownerswill do with the site. Easements permit these conservation-minded landowners to controlhow the property will be used in perpetuity, no matter who the future owners are. Another important reason that landowners turn to conservation easements is that donations,bargain sales, or bequests of easements can have beneficial tax consequences. In somecases, sale of a conservation easement nets the landowner the same amount as selling to adeveloper AND helps keep the land in the family.

How does the public benefit?

Conservation easements on natural land and farmland combat sprawl development and in so doing reduce tax money needed for roads, schools, police, fire protection and other public infrastructure, and help maintain a sense of community in urban and suburban areas. Conservation easements protect rural landscapes and provide the aesthetic beauty sought by citizens. Easements can be placed on private land surrounding public parks to create visual and habitat buffer areas. In addition, protecting open space land provides recreational opportunities for all citizens, both urban and rural. In short, protecting open space land helps maintain a community’s qualify of life.

Can easements ever be changed?

No. Once the conservation easement is recorded at the Register of Deeds Office no alterations or changes may be made. Open Space Conservation Easements ride with the deed in “perpetuity”.

Can easements ever be terminated?

Although most conservation easements are granted to run “in perpetuity,” easements canbe terminated under certain circumstances, many of which are not under the control of thegrantor or grantee.Easement restrictions may be terminated by condemnation of the underlying land by agovernment agency. IRS regulations require the easement document to address the distributionof proceeds that result from the condemnation.

Easement Pros and Cons

For the County and/or Township:

Easements are flexible tools. They can be written to achieve specific goals such aspreserving scenic viewsheds along a country road.
Easements are perpetual. The restrictions will remain in force even when the property changes ownership.
Easements can conserve scenic beauty and environmentally sensitive areas at a lower cost to themunicipality than fee simple acquisition.
Eased property remains on the tax rolls. Responsibility for maintaining the eased property typicallyremains with the landowner, yielding an additional savings to the municipality over fee simpleacquisition.
Easements may increase property values on surrounding properties.

For the Landowner:

Landowners can be assured that the eased portions of their property will be conserved forever.
Easements remain in force even when political leadership and zoning ordinances change in themunicipality.
Placing a conservation easement on the property may significantly lower estate taxes. The taxsavings could spell the difference between being able to keep the land in the family and needing tosell it to pay estate taxes.
An easement may lower property taxes due to a reduction in the property’s assessed vaue.
The easement may provide significant federal income tax benefits if the landowner donates theeasement to the municipality or land trust (rather than selling it at fair market value).
The reduction in an eased property’s market value may be partially made up for through moneygained from sale of the easement and/or through tax savings. A combination of conservationeasements and limited development on the property may well provide a net gain to the landownerequivalent to an outright sale to a developer who fully develops the property.
Landowners can continue to live on their properties and may sell it or pass it on to heirs.
An easement can be tailored to a landowner’s particular needs by using exemptions (such as reserving three acres for afuture residence for the landowner’s heir or keep out an existing home or structure).

Open Space Preservation Program

Open Space Purchase of Development Right Program Deadline: Friday, June30, 2017 at 11:00 a.m.

Ingham County Purchasing Department

c/o Farmland and Open Space Preservation Board

121 E. Maple Street, 2nd Floor

P.O. Box 319

Mason, MI 48854

Applications must be received in a sealed envelope!

Section ILandowner Information

Name (list all)

(include all persons recorded on the deed(s), i.e. spouses, partners, siblings, parents etc.)

E-mail (preferred form of communication)

Address

(Street/Rd)(City)(State)(Zip)

Telephone

(Daytime)(Evening)(Cell)

Section IIProperty Information

1.) Do you own all mineral rights on the Nominated Property?

If No, who owns them? ______

(Name)(Address)(Phone)

2.) Is the nominated property already restricted from being developed? (yes / no)

If yes, please explain: ______

3.) Tax Parcel ID # and acreage for each:Acres:Parcel ID Number:

4.) How is your land currently zoned? (circle one)

AgriculturalAgricultural ResidentialResidential Commercial

Commercial/IndustrialOther

5.) Do you have a USDA/NRCS Soil Conservation Plan?

If yes, what year was it developed?

6.) To the best of your knowledge does the property border water on any side?

No: Yes:

If yes, approximately how many feet of frontage borders the property?

7.) Is the nominated property in the 100-year flood plain?

No: Yes:

If yes, approximately how many acres are in the 100-year flood plain?______

8.) To the best of your knowledge, is the property a wetland?

No: Yes:

If yes, approximately how many acres are wetland?

9.) To the best of your knowledge, is any of the land an aquifer recharge area?

No: Yes:

If yes, approximately how many acres are in the aquifer recharge area? ______

10.)How many acres of the nominated property is forestland?______

11.)How many acres of the nominate property is shrub land, grassland etc.?___

12.)To the best of your knowledge, are there any rare or endangered species on the nominated property? No: Yes:

If yes, please describe:

13.)Are there any geologically important features present on the property?

No: Yes:

If yes, please describe: ______

14.)Please describe any scenic value the property may have: ______

Section III Certification

All (deeded) landowners mustsign the application.

I certify that the statements made above are a true and accurate representation of the facts regarding the

nominated property.

Print NameDate

Signature

Print NameDate