BILL ANALYSIS                                                                                                                                                                                                    Ó



                                                                     AB 707


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          Date of Hearing:  April 15, 2015


                          ASSEMBLY COMMITTEE ON AGRICULTURE


                                Henry T. Perea, Chair


          AB 707  
          Wood - As Amended April 6, 2015


          SUBJECT:  Agricultural land:  Williamson Act contracts:   
          cancellation.


          SUMMARY:  This bill removes the ability of a land owner and the  
          California Department of Conservation (DOC) to negotiate  
          Williamson Act (Act) cancellation fees, if the land in an Act  
          contract is within a county that has a local cancellation  
          assessment for Act contract lands.   


          EXISTING LAW:  



          1)Creates the Act, also known as the California Land  
            Conservation Act of 1965, which authorizes cities and counties  
            to enter into agricultural land preservation contracts with  
            landowners who agree to restrict the use of their land for a  
            minimum of 10 years in exchange for lower-assessed valuations  
            for property tax purposes. 

          2)Provides for a 12.5% cancellation fee, based on the value of  
            the land, for canceling an Act contract, as specified.  










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          3)Allows DOC and the landowner may agree on a cancellation  
            valuation of the land.



          4)Allows a city or county to pass an ordinance that requires an  
            additional cancellation penalty fee that goes to the local  
            jurisdiction.


          FISCAL EFFECT:  Unknown.


          COMMENTS:  The Act conserves agricultural and open space land by  
          allowing private property owners to sign voluntary contracts  
          with counties and cities, restricting their land to agriculture,  
          open space, and other compatible uses.  In return, county  
          assessors must lower the assessed value of the contracted lands  
          to reflect their use as agricultural or open space instead of  
          the market value.  Making sure that private property owners use  
          their Act land appropriately is essential to maintaining the  
          statute's constitutional integrity.





          Approximately 16.6 million acres are under Act contracts.  When  
          the proposed 2003-04 budget wanted to save approximately $39  
          million by ending the state subventions, the Legislative  
          Analyst's Office recommended a 10-year phase-out.  The  
          Legislature's 2009-10 budget reduced the subventions to $27.8  
          million.  The subventions were essentially eliminated in the  
          2009-10 budget by cutting the appropriation to $1,000.  There  
          were several attempts to restore this funding by the Legislature  
          in 2010, which were unsuccessful.








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          Due to the elimination of subvention payments, some local  
          jurisdictions passed ordinances that impose an additional  
          cancellation penalty fee.  If a property owner wanted to cancel  
          an Act contract before the ten year period, the landowner must  
          petition the local board or council to terminate a contract. The  
          board/council may grant cancellation if certain statutory  
          findings are met.  If the local government approves the  
          cancellation, the landowner is required to pay a cancellation  
          fee equal to 12.5% of the cancellation valuation of the property  
          to the state.  Merced County and Humboldt County (Humboldt) are  
          the only counties to have local cancellation fees, in addition  
          to the state cancellation fee.  Humboldt's local cancellation  
          fee is 12.5%.





          According the author, this bill is needed to address situations  
          where a local government has imposed an Act cancellation fee in  
          addition to the state Act cancellation fee.  The need was  
          demonstrated by the following incident:  On August 21, 2011, the  
          Ambrosini Dairy Property (Riverside Ranch), in Humboldt,  
          requested to cancel their Act contract.  The cancellation was  
          initiated by the Western Rivers Conservancy (WRC), who purchased  
          the land.  The request for cancellation triggered Humboldt  
          County Assessor Office to begin to determine the fair market  
          value of the land, which determines the Act cancellation fee.   
          The WRC requested a waiver to the Humboldt's fee.  The  
          Humboldt's Act Advisory Committee recommended to the Board of  
          Supervisors that the local cancellation fee not be waived.  On  
          April 23, 2012, the DOC sent a letter to Humboldt informing the  
          local jurisdiction that WRC and the DOC had reached an agreement  
          on a cancellation valuation, as allowed by current law.  This  








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          negotiation between the DOC and WRC took place without the  
          Humboldt's input.  This bill addresses this issue by allowing  
          the county, if it has a local cancellation fee, to be part of  
          the discussion of land valuation. 


          
          REGISTERED SUPPORT / OPPOSITION:




          Support


          County of Humboldt (sponsor)


          California State Association of Counties


          Rural County Representative of California




          Opposition


          None on file




          Analysis Prepared by:Victor Francovich / AGRI. / (916) 319-2084












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