Bill Text: NJ A5234 | 2024-2025 | Regular Session | Introduced
Bill Title: Authorizes State Agriculture Development Committee to maintain and use its own list of property appraisers, or to employ dedicated pool of property appraisers, or both, to facilitate valuation of land for farmland preservation purposes.
Spectrum: Partisan Bill (Republican 1-0)
Status: (Introduced) 2025-01-27 - Introduced, Referred to Assembly Commerce, Economic Development and Agriculture Committee [A5234 Detail]
Download: New_Jersey-2024-A5234-Introduced.html
Sponsored by:
Assemblyman ALEX SAUICKIE
District 12 (Burlington, Middlesex, Monmouth and Ocean)
SYNOPSIS
Authorizes State Agriculture Development Committee to maintain and use its own list of property appraisers, or to employ dedicated pool of appraisers, or both, to facilitate valuation of land for farmland preservation purposes.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning the use of property appraisers for farmland preservation purposes, and amending various parts of the statutory law.
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. Section 24 of P.L.1983, c.32 (C.4:1C-31) is amended to read as follows:
24. a. Any landowner applying to the board to sell a development easement pursuant to section 17 of P.L.1983, c.32 (C.4:1C-24) shall offer to sell the development easement at a price which, in the opinion of the landowner, represents a fair value of the development potential of the land for nonagricultural purposes, as determined in accordance with the provisions of P.L.1983, c.32 (C.4:1C-11 et al.).
b. Any offer shall be reviewed and evaluated by the board and the committee in order to determine the suitability of the land for development easement purchase. Decisions regarding suitability shall be based on the following criteria:
(1) Priority consideration shall be given, in any one county, to offers with higher numerical values obtained by applying the following formula:
nonagricultural - agricultural - landowner's
developmental value value asking price
---------------------------------------------------------------
nonagricultural - agricultural
development value value
(2) The degree to which the purchase would encourage the survivability of the municipally approved program in productive agriculture; and
(3) The degree of imminence of change of the land from productive agriculture to nonagricultural use.
The board and the committee shall reject any offer for the sale of development easements which is unsuitable according to the above criteria and which has not been approved by the board and the municipality.
c. (1) Two independent appraisals paid for by the board shall be conducted for each parcel of land so offered and deemed suitable. The appraisals shall be conducted by independent, professional appraisers selected by the board and the committee from among members of recognized organizations of real estate appraisers. [The appraisals] For the purposes of effectuating the appraisals required by this paragraph, the committee shall be authorized to establish and maintain a list of approved property appraisers, or to hire a dedicated pool of property appraisers, or both, who satisfy the organizational membership requirements set forth in this paragraph, and the board and committee shall be further authorized to select and utilize, for the purposes of conducting an appraisal pursuant to this paragraph, any appraiser who is identified on such list or is included as a member of such pool. Appraisals conducted pursuant to this paragraph shall determine the current overall value of the parcel for nonagricultural purposes, as well as the current market value of the parcel for agricultural purposes[. The], and the difference between the two values shall represent an appraisal of the value of the development easement.
(2) If Burlington County or a municipality therein has established a development transfer bank pursuant to the provisions of P.L.1989, c.86 (C.40:55D-113 et seq.) or if any county or any municipality in any county has established a development transfer bank pursuant to section 22 of P.L.2004, c.2 (C.40:55D-158) or the Highlands Water Protection and Planning Council has established a development transfer bank pursuant to section 13 of P.L.2004, c.120 (C.13:20-13), the municipal average of the value of the development potential of property in a sending zone established by the bank may be the value used by the board in determining the value of the development easement.
(3) If a development easement is purchased using moneys appropriated from the fund, the State shall provide no more than 80[%] percent, except that 100[%] percent may be provided under emergency conditions specified by the committee pursuant to rules or regulations, of the cost of the appraisals conducted pursuant to this section.
d. Upon receiving the results of the appraisals, or in Burlington county or a municipality therein or elsewhere where a municipal average has been established under subsection c. of this section, upon receiving an application from the landowners, the board and the committee shall compare the appraised value, or the municipal average, as the case may be, and the landowner's offer and, pursuant to the suitability criteria established in subsection b. of this section:
(1) Approve the application to sell the development easement and rank the application in accordance with the criteria established in subsection b. of this section; or
(2) Disapprove the application, stating the reasons therefor.
e. Upon approval by the committee and the board, the secretary is authorized to provide the board, within the limits of funds appropriated therefor, an amount equal to no more than 80[%] percent, except that 100[%] percent may be provided under emergency conditions specified by the committee pursuant to rules or regulations, of the purchase price of the development easement, as determined pursuant to the provisions of this section. The board shall provide its required share and accept the landowner's offer to sell the development easement. The acceptance shall cite the specific terms, contingencies and conditions of the purchase.
f. The landowner shall accept or reject the offer within 30 days of receipt thereof. Any offer not accepted within that time shall be deemed rejected.
g. Any landowner whose application to sell a development easement has been rejected for any reason other than insufficient funds may not reapply to sell a development easement on the same land within two years of the original application.
h. No development easement shall be purchased at a price greater than the appraised value determined pursuant to subsection c. of this section or the municipal average, as the case may be.
i. The appraisals conducted pursuant to this section or the fair market value of land restricted to agricultural use shall not be used to increase the assessment and taxation of agricultural land pursuant to the "Farmland Assessment Act of 1964," P.L.1964, c.48 (C.54:4-23.1 et seq.).
j. (1) In determining the suitability of land for development easement purchase, the board and the committee may also include as additional factors for consideration the presence of a historic building or structure on the land and the willingness of the landowner to preserve that building or structure, but only if the committee first adopts, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), rules and regulations implementing this subsection. The committee may, by rule or regulation adopted pursuant to the "Administrative Procedure Act," assign any such weight it deems appropriate to be given to these factors.
(2) The provisions of paragraph (1) of this subsection may also be applied in determining the suitability of land for fee simple purchase for farmland preservation purposes as authorized by P.L.1983, c.31 (C.4:1C-1 et seq.), P.L.1983, c.32 (C.4:1C-11 et seq.), and P.L.1999, c.152 (C.13:8C-1 et seq.).
(3) (a) For the purposes of paragraph (1) of this subsection: "historic building or structure" means the same as that term is defined pursuant to subsection c. of section 2 of P.L.2001, c.405 (C.13:8C-40.2).
(b) For the purposes of paragraph (2) of this subsection, "historic building or structure" means the same as that term is defined pursuant to subsection c. of section 1 of P.L.2001, c.405 (C.13:8C-40.1).
(cf: P.L.2004, c.120, s.44)
2. Section 5 of P.L.1988, c.4 (C.4:1C-31.1) is amended to read as follows:
5. a. Any landowner of farmland within an agricultural development area certified by the committee may apply to the committee to sell the fee simple absolute title at a price which, in the opinion of the landowner, represents a fair market value of the property.
b. The committee shall evaluate the offer to determine the suitability of the land for purchase. Decisions regarding suitability shall be based on the eligibility criteria for the purchase of development easements listed in section 24 of P.L.1983, c.32 (C.4:1C-31) and the criteria adopted by the committee and the board of that county. The committee shall also evaluate the offer taking into account the amount of the asking price, the asking price relative to other offers, the location of the parcel relative to areas targeted within the county by the board and among the counties, and any other criteria as the committee has adopted pursuant to rule or regulation. The committee may negotiate reimbursement with the county and include the anticipated reimbursement as part of the evaluation of an offer.
c. The committee shall rank the offers according to the criteria to determine which, if any, should be appraised. The committee shall reject any offer for the purchase of fee simple absolute title determined unsuitable according to any criterion in this subsection or adopted pursuant to this subsection, or may defer decisions on offers with a low ranking. The committee shall state, in writing, its reasons for rejecting an offer.
d. Appraisals of the parcel shall be conducted to determine the parcel's fair market value [according to], in accordance with procedures adopted by rule or regulation [by] of the committee. For the purposes of effectuating the appraisals required by this paragraph, the committee shall be authorized to establish and maintain a list of approved property appraisers, or to hire a dedicated pool of property appraisers, or both, who are members of recognized organizations of real estate appraisers, and the committee shall be further authorized to select and utilize, for the purposes of conducting an appraisal pursuant to this subsection, any appraiser who is identified on such list or is included as a member of such pool.
e. The committee shall notify the landowner of the fair market value and negotiate for the purchase of the title in fee simple absolute.
f. Any land acquired by the committee pursuant to the provisions of [this amendatory and supplementary act] P.L.1988, c.4 (C.4:1C-31.1 et seq.) shall be held of record in the name of the State and shall be offered for resale by the State, notwithstanding any other law, rule or regulation to the contrary, within a reasonable time of its acquisition with agricultural deed restrictions for farmland preservation purposes as determined by the committee pursuant to the provisions of [this act] P.L.1988, c.4 (C.4:1C-31.1 et seq.).
g. The committee shall be responsible for the operation and maintenance of lands acquired and shall take all reasonable steps to maintain the value of the land and its improvements.
h. To the end that municipalities may not suffer loss of taxes by reason of acquisition and ownership by the State of New Jersey of property under the provisions of [this act] P.L.1988, c.4 (C.4:1C-31.1 et seq.), the State shall pay annually on October 1 to each municipality in which property is so acquired and has not been resold a sum of money equal to the tax last assessed and last paid by the taxpayer upon this land and the improvement thereon for the taxable year immediately prior to the time of its acquisition. In the event that land acquired by the State pursuant to [this act] P.L.1988, c.4 (C.4:1C-31.1 et seq.) had been assessed at an agricultural and horticultural use valuation in accordance with provisions of the "Farmland Assessment Act of 1964," P.L.1964, c.48 (C.54:4-23.1 et seq.), at the time of its acquisition by the State, no rollback tax pursuant to section 8 of P.L.1964, c.48 (C.54:4-23.8) shall be imposed as to this land nor shall this rollback tax be applicable in determining the annual payments to be made by the State to the municipality in which this land is located.
All sums of money received by the respective municipalities as compensation for loss of tax revenue pursuant to this section shall be applied to the same purposes as is the tax revenue from the assessment and collection of taxes on real property of these municipalities, and to accomplish this end the sums shall be apportioned in the same manner as the general tax rate of the municipality for the tax year preceding the year of receipt.
(cf: P.L.2001, c.405, s.4)
3. Section 39 of P.L.1999, c.152 (C.13:8C-39) is amended to read as follows:
39. a. The committee may provide a grant to a qualifying tax exempt nonprofit organization for up to 50[%] percent of the cost of acquisition of (1) a development easement on farmland, provided that the terms of any such development easement shall be approved by the committee, or (2) fee simple title to farmland, which shall be offered for resale or lease with an agricultural deed restriction, as determined by the committee, and any proceeds received from a resale shall be dedicated for farmland preservation purposes and the State's pro rata share of any such proceeds shall be deposited in the Garden State Farmland Preservation Trust Fund to be used for the purposes of that fund.
b. The value of a development easement or fee simple title shall be established by two appraisals conducted on each parcel and certified by the committee. The appraisals shall be conducted by independent professional appraisers selected by the qualifying tax exempt nonprofit organization and approved by the committee from among members of recognized organizations of real estate appraisers. For the purposes of effectuating the appraisals required by this subsection, the committee shall be authorized to establish and maintain a list of approved property appraisers, or to hire a dedicated pool of property appraisers, or both, who are members of recognized organizations of real estate appraisers, and a qualifying tax exempt nonprofit organization shall be authorized to select and utilize, for the purposes of conducting an appraisal pursuant to this subsection, any appraiser who is identified on such list or is included as a member of such pool.
c. The appraisals shall determine the fair market value of the fee simple title to the parcel, as well as the fair market value of the parcel for agricultural purposes. The difference between the two values shall represent an appraisal of the value of the parcel for nonagricultural purposes, which shall be the value of the development easement.
d. Any grant provided to a qualifying tax exempt nonprofit organization pursuant to this section shall not exceed 50[%] percent of the appraised value of the development easement, or of the fee simple title in the case of fee simple acquisitions, as determined pursuant to subsection e. of section 8 of P.L.2016, c.12 (C.13:8C-50), plus up to 50[%] percent of any costs incurred including but not limited to the costs of surveys, appraisals, and title insurance.
e. The appraisals conducted pursuant to this section [or], and the fair market value of land restricted to agricultural use, as determined pursuant to this section, shall not be used to increase the assessment and taxation of agricultural land pursuant to the "Farmland Assessment Act of 1964," P.L.1964, c.48 (C.54:4-23.1 et seq.).
f. To qualify to receive a grant pursuant to this section, the applicant shall:
(1) demonstrate that it has the resources to match the grant requested; and
(2) in the case of the acquisition of a development easement, agree not to convey the development easement except to the federal government, the State, a local government unit, or another qualifying tax exempt nonprofit organization, for farmland preservation purposes.
g. (1) In deciding whether to award a grant to a qualifying tax exempt nonprofit organization pursuant to this section, the committee may also include as additional factors for consideration the presence of a historic building or structure on the land and the willingness of the landowner to preserve that building or structure, but only if the committee first adopts, pursuant to the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.), rules and regulations implementing this subsection. The committee may, by rule or regulation adopted pursuant to the "Administrative Procedure Act," assign any such weight it deems appropriate to be given to these factors.
(2) For the purposes of this subsection: "historic building or structure," in the context of the grant program for qualifying tax exempt nonprofit organizations to acquire development easements on farmland for farmland preservation purposes, means the same as that term is defined pursuant to subsection c. of section 2 of P.L.2001, c.405 (C.13:8C-40.2); and "historic building or structure," in the context of the grant program for qualifying tax exempt nonprofit organizations to acquire fee simple titles to farmland for farmland preservation purposes, means the same as that term is defined pursuant to subsection c. of section 1 of P.L.2001, c.405 (C.13:8C-40.1).
(cf: P.L.2001, c.405, s.5)
4. Section 8 of P.L.2016, c.12 (C.13:8C-50) is amended to read as follows:
8. a. The State Treasurer shall establish a fund to be known as the "Preserve New Jersey Farmland Preservation Fund" and shall deposit all moneys received pursuant to paragraph (3) of subsection a. of section 5 of P.L.2016, c.12 (C.13:8C-47), paragraph (2) of subsection a. of section 1 of P.L.2019, c.136 (C.13:8C-47.1), and any other moneys appropriated by law for deposit into the fund.
Moneys in the fund shall be invested in permitted investments or shall be held in interest-bearing accounts in those depositories as the State Treasurer may select, and may be invested and reinvested in permitted investments or as other trust funds in the custody of the State Treasurer in the manner provided by law. All interest or other income or earnings derived from the investment or reinvestment of moneys in the fund shall be credited to the fund.
b. (1) The moneys in the fund are specifically dedicated and shall be used for the same purposes as those set forth in section 37 of P.L.1999, c.152 (C.13:8C-37) and as provided in paragraph (2) of this subsection.
(2) Of the moneys deposited into the Preserve New Jersey Farmland Preservation Fund: (a) in State fiscal year 2017 through and including State fiscal year 2019, up to three percent shall be allocated by the committee on an annual basis for stewardship activities; and (b) commencing in State fiscal year 2020 and annually thereafter, up to four percent shall be allocated by the committee on an annual basis for stewardship activities.
(3) Notwithstanding any provision of P.L.2016, c.12 (C.13:8C-43 et seq.) to the contrary, stewardship activities undertaken on farmland on which (a) the pinelands development credits have been acquired pursuant to P.L.1979, c.111 (C.13:18A-1 et seq.), and the pinelands comprehensive management plan adopted pursuant thereto, or the development rights have been acquired pursuant to a transfer of development rights program for the Highlands Region established pursuant to section 13 of P.L.2004, c.120 (C.13:20-13), and (b) there is deed restriction approved by the committee, shall be eligible for funding pursuant to paragraph (2) of this subsection.
c. Moneys in the fund shall not be expended except in accordance with appropriations from the fund made by law. Any act appropriating moneys from the Preserve New Jersey Farmland Preservation Fund shall identify any particular project or projects to be funded by the moneys, and any expenditure for a project for which the location is not identified by municipality and county in the appropriation shall require the approval of the Joint Budget Oversight Committee, or its successor, except as permitted otherwise in accordance with the same exceptions as those specified in paragraph (2) of subsection b. of section 23 of P.L.1999, c.152 (C.13:8C-23).
d. Unexpended moneys due to project withdrawals, cancellations, or cost savings shall be returned to the fund.
e. Notwithstanding the provisions of section 24 of P.L.1983, c.32 (C.4:1C-31) or section 38 of P.L.1999, c.152 (C.13:8C-38), or any rule or regulation adopted pursuant thereto, to the contrary, [when] whenever the committee, a local government unit, or a qualifying tax exempt nonprofit organization seeks to acquire a development easement on, or fee simple title to, farmland using, in whole or in part, monies deposited into the Preserve New Jersey Farmland Preservation Fund, the Garden State Farmland Preservation Trust Fund established pursuant to section 20 of P.L.1999, c.152 (C.13:8C-20), or any other State monies provided for farmland preservation purposes, the value of the development easement, or fee simple title, as applicable, shall be [determined by the following]:
(1) the value determined in accordance with the procedure set forth in section 24 of P.L.1983, c.32 (C.4:1C-31);
(2) [a] the value determined in accordance with a formula, to be known as the "Statewide Farmland Preservation Formula," which formula is established by rule or regulation adopted by the committee, pursuant to subsection f. of this section, and includes:
(a) conducting or analyzing a sufficient number of fair market value appraisals of agricultural lands within the municipality in which the land is located, or the surrounding market area, or both, as the committee deems appropriate to determine the value of the land for farmland preservation. For the purposes of effectuating the appraisals required by this subparagraph, the committee shall be authorized to establish and maintain a list of approved property appraisers, or to hire a dedicated pool of property appraisers, or both, who are members of recognized organizations of real estate appraisers, and the entity proposing to acquire the land, for farmland preservation purposes, shall be further authorized to select and utilize, for the purposes of conducting an appraisal pursuant to this subparagraph, any appraiser who is identified on such list or is included as a member of such pool;
(b) considering farmland and development easement values in counties and municipalities reasonably contiguous to, but outside of, the municipality in which the land to be acquired is located, which in the sole opinion of the committee constitute reasonable farmland and development easement values for the purposes of this subsection;
(c) considering the importance of preserving agricultural lands in the municipality and county in which the land is located;
(d) considering the status and value of natural resources in the municipality and county in which the land is located, and in counties and municipalities that are reasonably contiguous to, but outside of, the municipality and county in which the land is located;
(e) considering such other relevant factors as may be necessary to increase participation in the farmland preservation program by owners of agricultural lands located in the municipality and county in which the land is located, including, but not limited to, the rate of inflation, the quality of the agricultural soils, the size of the agricultural lands to be acquired, and the risk of conversion of the land from productive agriculture to nonagricultural use; and
(f) providing additional value for the proximity of agricultural lands located adjacent to preserved agricultural lands, lands preserved for recreation and conservation purposes, aquifer recharge areas, lands subject to development or conservation easements, and lands whose conversion to nonagricultural use would lead to conflicting land uses, including, but not limited to, utility and roadway rights-of-way, military bases, and airports and associated airspace; and, if applicable,
(3) (a) in the case of property located in the pinelands area, whenever the value of a development easement on farmland to be acquired is determined based upon the value of any pinelands development credits allocated to the parcel pursuant to P.L.1979, c.111 (C.13:18A-1 et seq.) and the pinelands comprehensive management plan adopted pursuant thereto, the value determined by the committee pursuant to subsection e. of section 38 of P.L.1999, c.152 (C.13:8C-38); or
(b) in the case of property located in the Highlands Region, the value determined pursuant to subsection j. of section 38 of P.L.1999, c.152 (C.13:8C-38).
The landowner shall be provided with the values determined pursuant to paragraphs (1) and (2) of this subsection, and if applicable, the value determined pursuant to paragraph (3) of this subsection. The higher of the values shall be utilized by the committee, a local government unit, or a qualifying tax exempt nonprofit organization as the basis for negotiation with the landowner with respect to the acquisition price. A landowner may waive any of the requirements of this subsection and may agree to sell the lands for less than the values determined pursuant to this subsection.
f. Notwithstanding the provisions of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.) to the contrary, the committee shall, immediately upon filing proper notice with the Office of Administrative Law, adopt rules and regulations to establish the "Statewide Farmland Preservation Formula" required pursuant to paragraph (2) of subsection e. of this section. The rules and regulations adopted pursuant to this subsection shall be in effect for a period not to exceed three years after the date of the filing. These rules and regulations shall thereafter be adopted, amended, or readopted by the committee in accordance with the requirements of the "Administrative Procedure Act," P.L.1968, c.410 (C.52:14B-1 et seq.).
(cf: P.L.2023, c.245, s.2)
5. This act shall take effect immediately.
STATEMENT
This bill would authorize the State Agriculture Development Committee (committee) to establish and maintain a list of approved property appraisers, or to hire a dedicated pool of property appraisers, or both, who are members of recognized organizations of real estate appraisers, for the purposes of facilitating the prompt and accurate valuation of agricultural lands for farmland preservation purposes. The bill would further authorize any State, local, or nonprofit entity that is proposing to acquire fee simple title to, or a development easement on, farmland for preservation purposes, to select and utilize, for farmland valuation purposes, any property appraiser who is identified on the committee's list or is included as a member of the committee's dedicated pool.
The committee is currently in the process of implementing recent law that establishes a formula-based appraisal process for preserving farmland. It is anticipated that this new system will stimulate greater interest in saving farmland. Currently, the committee uses a list of property appraisers maintained by the Department of Environmental Protection; however, this list does not specifically include appraisers who specialize in farmland preservation and is updated infrequently. In order to respond to the growing list of farmers who are interested in preserving their farmland, it is necessary to provide the committee with the ability to develop its own list or pool of qualified appraisers for farmland preservation purposes.
