HB2468 103RD GENERAL ASSEMBLY

LRB103 25491 RLC 51840 b

103RD GENERAL ASSEMBLY
State of Illinois
2023 and 2024
HB2468

Introduced 2/15/2023, by Rep. Sonya M. Harper

SYNOPSIS AS INTRODUCED:

New Act
30 ILCS 105/5.990 new

Creates the Farmland Conservancy Program Act. Creates the Farmland Conservancy Program Fund in the State treasury. Provides that the moneys in the fund shall, upon appropriation by the General Assembly, be used for the purposes of the program, which include the purchase of agricultural conservation easements, fee title acquisition grants, land improvement and planning grants, technical assistance grants, technical assistance provided by the Department of Agriculture, technology transfer activities of the Department, and administrative costs incurred by the Department in administering the program. Provides that not less than 25% of funds shall be provided to applicants that lease or sell to socially disadvantaged farmers. Provides that moneys in the fund shall also be available for the following purposes: (1) to provide technical assistance grants to eligible assistance entities in support of socially disadvantaged farmers who are seeking financing for land acquisition or leasing; (2) to provide acquisition assistance grants to eligible assistance entities for the sole purpose of reducing barriers to land access for socially disadvantaged farmers, including, but not limited to, down payment assistance, interest rate assistance, direct costs incidental to acquisition, and infrastructure for land improvement; (3) to provide technical assistance grants to eligible assistance entities in support of socially disadvantaged farmers who are seeking financing for land acquisition or leasing; and (4) to provide acquisition assistance grants to eligible assistance entities for the sole purpose of reducing barriers to land access for socially disadvantaged farmers, including, but not limited to, down payment assistance, interest rate assistance, direct costs incidental to acquisition, and infrastructure for land improvement. Amends the State Finance Act to make a conforming change.

A BILL FOR

AN ACT concerning agriculture.

Be it enacted by the People of the State of Illinois, represented in the General Assembly:

Section 1. Short title. This Act may be cited as the Farmland Conservancy Program Act.

Section 5. Findings; intent.

(a) The General Assembly finds that:

(1) The agricultural lands of this State contribute substantially to the State, national, and world food supply and are a vital part of the state's economy.

(2) Illinois has lost 3,600,000 acres of farmland since 1950, an average of almost 77,000 acres each year. From 1950 to 1990, the population of the United States increased by more than 97,000,000, and Illinois' population increased by more than 2,700,000. As the world's population continues to grow, so will the need for food and other goods produced from agricultural commodities. Preserving farmland is necessary to meet the needs of people in Illinois, the United States, and around the globe.

(3) This conversion of agricultural land permanently impedes Illinois's current and future ability to store carbon, maintain resilient regional ecosystems, and produce food.

(4) The growing population and expanding economy of this State have had a profound impact on the ability of the public and private sectors to conserve land for the production of food and fiber, especially agricultural land around urban areas.

(5) Agricultural lands near urban areas that are maintained in productive agricultural use are a significant part of Illinois' agricultural heritage. These lands contribute to the economic betterment of local areas and the entire State and are an important source of food, fiber, and other agricultural products. Conserving these lands is necessary due to increasing development pressures and the effects of urbanization on farmlands close to municipalities.

(6) The long-term conservation of agricultural land is necessary to safeguard an adequate supply of agricultural land and to balance the increasing development pressures around urban areas.

(7) A program to encourage and make possible the long-term conservation of agricultural lands is a necessary part of the State's agricultural land protection policies and programs, and it is appropriate to expend money for that purpose. A program of this nature will only be effective when used in concert with local planning and zoning strategies to conserve agricultural land.

(8) Funding is necessary to better address the needs of conserving agricultural land near urban areas.

(9) Concurrently, access to working lands for low-income farmers and farmers of color is prohibitively difficult, in part due to the ongoing legacies of institutionalized racism and discrimination and their effects upon access to State and federal farm loan programs.

(10) New opportunities are needed for socially disadvantaged farmers to access land through ownership or long-term leasing of farmland and rangeland.

(11) Down payment assistance, interest rate assistance, predevelopment and appraisal costs, and one-time investments in infrastructure improvements can provide favorable terms to socially disadvantaged farmers and support their access to and stewardship of Illinois farmland.

(12) Funding for fee title acquisition and agricultural conservation easements can make land permanently more affordable and accessible to socially disadvantaged farmers or ranchers, while ensuring that it is never lost to sprawl development.

(b) It is the intent of the General Assembly, in enacting this Act, to do all of the following:

(1) Encourage voluntary, long-term private stewardship of agricultural lands by offering landowners financial incentives.

(2) Protect farming operations in agricultural areas from nonfarm land uses that may hinder and curtail farming operations.

(3) Encourage long-term conservation of productive agricultural lands in order to protect the agricultural economy of rural communities, as well as that of this State, for future generations of Illinoisans.

(4) Encourage local land use planning for orderly and efficient urban growth and conservation of agricultural land.

(5) Encourage local land use planning decisions that are consistent with the State's policies with regard to agricultural land conservation.

(6) Encourage improvements to enhance long-term sustainable agricultural uses.

(7) Remove barriers to socially disadvantaged farmers participating in the agricultural economy and stewarding working lands under conservation.

Section 10. Definitions. In this Act:

"Agricultural land" means prime farmland, farmland of statewide importance, unique farmland, farmland of local importance, and farmland of local potential. In those areas of the state where lands have not been surveyed for classification, land shall meet the requirements of "prime farmland".

"Agricultural use value" means the fair market value of a property that is restricted by an easement to its productive commercial agricultural use value rather than the highest potential use value for residential or other nonagricultural purposes, plus any reasonable holding and transaction costs incurred by the applicant, as determined by the Department.

"Applicant" means a municipality, county, nonprofit organization, conservation district, park district, or cooperative that has the conservation of farmland among its stated purposes, as prescribed by law, or as expressed in the entity's locally adopted policies, that applies for a grant authorized under this Act.

"Department" means the Department of Agriculture.

"Director" means the Director of Agriculture.

"Eligible assistance entity" means a nonprofit organization or cooperative with demonstrated technical expertise in agricultural financing and farm business development assistance to achieve the purposes of this Act.

"Farmer-purchaser preference" or "option to purchase at agricultural value" means preemptive purchase rights or other provisions that are part of or linked to an agricultural conservation easement providing the easement holder the preferential right to purchase protected agricultural land at its agricultural use value in the event the landowner intends to sell that land to a purchaser who does not intend to maintain the land in commercial agricultural production and who does not demonstrate, in a manner acceptable to the Department, a management plan and the agricultural experience to maintain the land in commercial agricultural production. The purpose of this provision is to ensure that farmer-purchasers who would maintain protected land in commercial agricultural production can afford the land that might otherwise be sold at a higher price to other purchasers.

"Prime farmland" has the meaning ascribed to it in 7 CFR 657.5.

"Productivity provision" means language in the text of an agricultural conservation easement that requires the land under easement to be managed for productive commercial agricultural uses, with reasonable allowances for when temporary fallowing is necessary or appropriate.

"Socially disadvantaged farmer" means a farmer who is a member of a socially disadvantaged group.

"Socially disadvantaged group" means a group whose members have been subjected to racial, ethnic, or gender prejudice because of their identity as members of a group without regard to their individual qualities. These groups include all of the following:

(1) American Indian or Alaska Native (a person having origins in any of the original peoples of North and South America, including Central America, and who maintains tribal affiliation or community attachment).

(2) Asian (a person having origins in any of the original peoples of the Far East, Southeast Asia, or the Indian subcontinent, including, but not limited to, Cambodia, China, India, Japan, Korea, Malaysia, Pakistan, the Philippine Islands, Thailand, and Vietnam).

(3) Black or African American (a person having origins in any of the black racial groups of Africa).

(4) Hispanic or Latino (a person of Cuban, Mexican, Puerto Rican, South or Central American, or other Spanish culture or origin, regardless of race).

(5) Native Hawaiian or Other Pacific Islander (a person having origins in any of the original peoples of Hawaii, Guam, Samoa, or other Pacific Islands).

"Urbanized area" means an area with a population of at least 50,000 inhabitants.

Section 15. Farmland Conservancy Program Fund.

(a) The Farmland Conservancy Program Fund is created in the State treasury. Except as provided in subsection (b), the moneys in the fund, upon appropriation by the General Assembly, shall be used for the purposes of the program, which include the purchase of agricultural conservation easements, fee title acquisition grants, land improvement and planning grants, technical assistance grants, technical assistance provided by the Department, technology transfer activities of the Department, and administrative costs incurred by the Department in administering the program.

(b) Notwithstanding subsection (a), moneys may be deposited into the fund from federal grants, and gifts and donations that are designated and required by the donor to be used exclusively for the purposes of the program.

(c) Not to exceed 10% of all grants made by the Department under this Act may be made for land improvement purposes, technical assistance purposes, and policy planning purposes. Not less than 90% of funds available for grants under this Act shall be expended for the acquisition of interests in land. For purposes of this Act, the expenditures specified in this subsection shall be deemed expenditures for the acquisition of interests in land. Not less than 25% of funds shall be provided to applicants that lease or sell to socially disadvantaged farmers. Moneys in the fund shall also be available for the following purposes:

(1) To provide technical assistance grants to eligible assistance entities in support of socially disadvantaged farmers who are seeking financing for land acquisition or leasing. For purposes of this Section, technical assistance includes, but is not limited to, organizing, advising, counseling, educating, planning, drafting, translating, interpreting, and consulting with socially disadvantaged farmers for the purpose of preparing them for favorable financing for land acquisition or negotiating leasing arrangements.

(2) To provide acquisition assistance grants to eligible assistance entities for the sole purpose of reducing barriers to land access for socially disadvantaged farmers, including, but not limited to, down payment assistance, interest rate assistance, direct costs incidental to acquisition, and infrastructure for land improvement.

(3) To provide technical assistance grants to eligible assistance entities in support of socially disadvantaged farmers who are seeking financing for land acquisition or leasing. For purposes of this paragraph (3), technical assistance includes, but is not limited to, organizing, advising, counseling, educating, planning, drafting, translating, interpreting, and consulting with socially disadvantaged farmers for the purpose of preparing them for favorable financing for land acquisition or negotiating leasing arrangements.

(4) To provide acquisition assistance grants to eligible assistance entities for the sole purpose of reducing barriers to land access for socially disadvantaged farmers, including, but not limited to, down payment assistance, interest rate assistance, direct costs incidental to acquisition, and infrastructure for land improvement.

Section 20. Agricultural conservation easement. Applicants for an agricultural conservation easement or fee title acquisition grant shall meet all of the following eligibility criteria:

(1) Demonstrate that the parcel proposed for conservation is expected to continue to be used for commercial agricultural production if successfully conserved.

(2) The parcel proposed for conservation is expected to continue to be used for, and is large enough to sustain, commercial agricultural production. The land is also in an area that possesses the necessary market, infrastructure, and agricultural support services, and the surrounding parcel sizes and land uses will support long-term commercial agricultural production.

(3) The applicable municipality or county has a general plan that demonstrates a long-term commitment to agricultural land conservation. This commitment shall be reflected in the goals, objectives, policies, and implementation measures of the plan, as they relate to the area of the county or city where the easement acquisition is proposed.

(4) Without conservation, the land proposed for protection is likely to be converted to nonagricultural use in the foreseeable future.

The Director shall not disburse any grant funds for easement or fee title acquisitions unless the applicant, and in the case of an easement acquisition grant, the seller, agrees to restrict the use of the land in perpetuity.

Section 25. Grant for acquisition of fee title to agricultural land.

(a) The Director shall disburse funds to an applicant for a grant for the acquisition of fee title to agricultural land only if the applicant agrees to all of the following conditions:

(1) Upon acquisition of the property, the applicant treats the property as encumbered by an agricultural conservation easement subject to this Act and approved by the Department.

(2) Upon acquisition of the property, the applicant shall do either of the following:

(A) Sell the fee title subject to an agricultural conservation easement approved by the Department to a private landowner at not more than agricultural use value within 3 years of the acquisition of the fee title.

(B) Lease the acquired property, subject to an agricultural conservation easement, including a productivity provision, at an affordable agricultural rate, and approved by the department, to a socially disadvantaged farmer or rancher within 3 years of the acquisition of the fee title.

(3) Include a farmer-purchaser preference in the text of the agricultural conservation easement used to encumber the acquired property.

(b)(1) If the applicant sells the fee title, as specified in subparagraph (A) of paragraph (2) of subsection (a), the applicant shall reimburse the fund directly from escrow within 30 days after the sale of the restricted fee title by an amount equal to the Department's proportional share of the net proceeds of the sale.

(2) "Net proceeds of the sale" means the fair market value of the land less the value of the easement and associated transaction costs.

(3) The Department's proportional share of the net proceeds of the sale shall be calculated using a factor reflecting the Department's proportional share of the purchase price paid by the applicant in the original acquisition of fee title, taking into account contributions from all sources toward that original purchase price.

Section 30. Land improvement grants. Grants may be made for land improvements. Use of these grants shall be limited to the improvement of lands protected by agricultural conservation easements under the program, or of lands protected by other qualified conservation easement programs, if the improvement will directly benefit the lands protected by agricultural conservation easements under the program. An application for a land improvement grant shall be evaluated with respect to the extent to which it satisfies one or more of the following criteria:

(1) The improvement will enhance the agricultural value of the land protected by the easement, and promote its long-term sustainable agricultural use such as increasing soil organic matter or soil health, water supply development, and revegetation of eroding streambanks.

(2) The improvement will increase the compatibility of agricultural operations with sensitive natural areas.

(3) The improvement will demonstrate new and innovative best management practices that have the potential for wide application.

(4) The proposed improvement includes the financial and technical involvement of other agencies, such as University of Illinois Cooperative Extension Service, conservation districts, the Department of Natural Resources, the United States Farm Services Agency, and the United States Natural Resources Conservation Service.

(5) The improvement is part of a coordinated watershed management plan or the equivalent.

(6) The application satisfies other relevant criteria established by the Department.

Section 35. Use of agricultural conservation easement or fee title acquisition grant. Applicants for an agricultural conservation easement or fee title acquisition grant shall demonstrate that the parcel proposed for conservation is expected to continue to be used for commercial agricultural production if successfully conserved.

Section 40. Evaluation of proposals for fee title or agricultural conservation easement acquisition grant. The Director shall evaluate a proposal for a fee title or agricultural conservation easement acquisition grant based upon the overall value of the project, taking into consideration the goals and objectives for this program, and the extent to which the proposed project satisfies the following selection criteria:

(1) The quality of the agricultural land, based on land capability, farmland mapping and monitoring program definitions, productivity indices, and other soil, climate, and vegetative factors.

(2) The proposal meets multiple natural resource conservation objectives, including, but not limited to, wetland protection, wildlife habitat conservation, and scenic open-space preservation.

(3) The proposal reduces barriers to land access for socially disadvantaged farmers and ranchers through ownership or long-term leases.

(4) The applicant demonstrates fiscal and technical capability to effectively carry out the proposal. Technical capability may be demonstrated by agricultural land conservation expertise on the governing board or staff of the applicant, or through partnership with an organization that has that expertise.

(5) The proposal demonstrates a coordinated approach among affected local stakeholders. If other entities are directly impacted by the proposal, there is written support from those entities demonstrating a willingness to cooperate. The support of neighboring landowners who are not involved in the proposal shall be considered.

(6) The conservation of the land supports long-term private stewardship and continued agricultural production in the region.

(7) The proposal demonstrates an innovative approach to agricultural land conservation with a potential for wide application in this State.

(8) The amount of matching funds and in-kind services contributed by local governments and other sources toward the acquisition of the fee title or agricultural conservation easement, or both.

(9) The price of the proposed acquisition is cost-effective in comparison to the fair market value.

(10) Other relevant considerations established by the Director.

Section 45. Compatibility with county or municipal plan. Before the disbursement of grant funds for easements or fee title acquisitions under this Act, both of the following conditions shall be met:

(1) The proposed agricultural conservation project shall be deemed by the Department to be compatible with the applicable municipal or county general plan.

(2) For land within a municipality's sphere of influence, the proposed agricultural conservation project shall be deemed by the Department to be compatible with both the applicable county and municipal general plans.

Section 50. Exemptions. An agricultural conservation easement shall not prevent any of the following:

(1) The granting of rights-of-way by the owner of the subject land in and through the land for the installation, transportation, or use of water, sewage, electric, telephone, stock water development and storage, energy generation, and fencing, provided that the agricultural productivity of the land and any multiple uses that made the acquisition a priority for selection under the program, are not significantly impaired by those activities.

(2) The construction and use of structures on the subject land that are necessary for agricultural production and marketing, including, but not limited to, barns, shops, packing sheds, cooling facilities, greenhouses, roadside marketing stands, stock water development and storage, energy generation, and fencing, provided that the agricultural productivity of the land and any multiple uses that made the acquisition a priority for selection under the program, are not significantly impaired by those activities.

(3) Customary part time or off season rural enterprises or activities, including, but not limited to, hunting and fishing, wildlife habitat improvement, predator control, timber harvesting, and firewood production, provided that the agricultural productivity of the land and any multiple uses that made the acquisition a priority for selection under the program, are not significantly impaired by those activities.

Section 90. The State Finance Act is amended by adding Section 5.990 as follows:

(30 ILCS 105/5.990 new)

Sec. 5.990. The Farmland Conservancy Program Fund.