Handle funding locally, or wait for next year's budget? It's a 'catch-22'
By WES SANDER
Amid uncertainty over what California's budget will bring next year, local jurisdictions are facing the quandary of how to compensate for the state's axed support for the Williamson Act.
In July, Gov. Arnold Schwarzenegger vetoed funding for the popular farmland-conservation program, along with 20 other programs, after the legislature approved a budget with a reserve fund that was deemed too small.
Through the four-decade-old Williamson Act, the state pays subventions to local governments -- money that compensates for property taxes lost when they enter contracts with landowners to preserve farmland in exchange for lower tax assessments.
It's all proving a conundrum for counties, as they trim budgets while considering ways of compensating for lost subventions.
"The supervisors are concerned about where that money is coming from," said Ryan Jacobsen, executive director of the Fresno County Farm Bureau. "It really is a catch-22 for them to figure out what to do."
The California Farm Bureau Federation foresees a pitfall if counties begin formulating their own fixes. Such efforts could signal to lawmakers that Williamson Act contracts can be maintained without taxpayer help, while the Farm Bureau -- with help from counties, farm interests and conservation groups -- is lobbying Sacramento to restore the program's funding in the 2010-11 fiscal year.
Either way, the program's benefit to agriculture is already shrinking, as most counties have stopped taking applications for new contracts.
"The Williamson Act is significant," Jacobsen said. "It does make the difference for producers, (impacting) whether or not they're going to see a profit from year to year."
Schwarzenegger left $1,000 in the subvention account, signaling that his veto is a one-year suspension of the funding.
Counties meanwhile are attempting to weed out contracts that don't directly supporting agriculture, including those applied to properties on which landowners grow crops more as a hobby than a source of income.
Counties have until an annual November deadline to initiate contract non-renewals. Properties with canceled contracts do not fully revert to normal property-tax levels until the end of a nine-year process.
"Non-renewal is a long-term proposition, and it's not something you enter into lightly," said Katie Albertson, governmental affairs director with Merced County.
Earlier this year, Tulare County engaged ag stakeholders to formulate the idea of an assessment district, whereby landowners would pay fees to compensate for the county's loss of subventions.
While it weakens the Williamson Act's support of agriculture, the system would still leave landowners with a discount compared to normal property-tax levels, said Tulare County Supervisor Steve Worthley.
Tulare County, among the state's top Williamson Act counties, has received about $3.5 million in subventions in recent years. Supervisors see the value of supporting agricultural production, which drives much of the county's economy.
"I just don't think the county can forego this (subvention revenue) in perpetuity," Worthley said. "In some cases it's not that big a deal, because it's a very small amount. But I've seen some counties for whom it's a very significant amount of money."
The problem with the assessment district, according to the farm bureau -- or any other idea for supporting the Williamson Act locally -- is that it sends the wrong message to Sacramento.
"Initially, farm bureau and other landowners and ag groups who were at the table said we should talk further," said Tricia Stever, executive director of the Tulare County Farm Bureau. "(But) if a county has come up with an idea on its own and taxed landowners to come up with that money, then the state will say (subvention funding) is not important. We're probably going to wind up justifying the elimination of the Williamson Act on the state level."
That's to say nothing of the fact that adding costs for landowners contradicts the program's intent, Stever said.
"We are aware that for them to continue servicing the Williamson Act, they are having to downsize other programs in the county," Stever said. "But they're asking farmers to pay more on their farmland, and that's not what the Williamson Act is intended to do."
Staff writer Wes Sander is based in Sacramento. E-mail: firstname.lastname@example.org.