Greenbelt Commission Terms Revised

Ann Arbor greenbelt advisory commission meeting (May 11, 2011): Wednesday was the last regular meeting for two greenbelt commissioners – terms end on June 30 for chair Jennifer S. Hall and Gil Omenn, who were both active in efforts to launch the program. Both have reached the term limits for serving on GAC.

Instead of holding their regular meetings in June, the greenbelt and park advisory commissions have scheduled a joint working session to discuss common goals and priorities – they last met jointly in April 2010.

Term limits were raised in another context during Wednesday’s meeting, when commissioners were asked to recommend that city council restate current GAC membership terms. Mary Fales of the city attorney’s office has been working on the revisions, after inconsistencies were discovered for current appointments. For example, a term for Ecology Center director Mike Garfield ended on June 30, 2009. Though he continued to serve, he was not officially reappointed to another three-year term until Sept. 21, 2010. Under the resolution recommended by GAC, all terms would end on June 30, over staggered years.

Also at Wednesday’s meeting, commissioners got an update about Michigan budget-related legislation that would cut tax credits for farmers. They were also briefed by staff about changes to the federal Farm and Ranchland Protection Program – the city has received millions of dollars worth of FRPP grants over the years to offset the cost of development rights purchased in the greenbelt.

Ginny Trocchio, support staff for the greenbelt program, told commissioners that June 16 is the date for a greenbelt celebration, starting at 5:30 p.m. at the Braun farm in Ann Arbor Township, which was added to the greenbelt in 2010. The event will be open to the public, and will include a presentation to highlight the program’s accomplishments.

Dan Ezekiel, GAC’s vice chair, reported that the subcommittee he’s leading to look at possible changes in the greenbelt boundary will be making a proposal at the commission’s July 13 meeting.

And in its final action of the meeting, commissioners emerged from a closed session and voted to recommend that Ann Arbor city council make a $127,200 offer for the purchase of development rights on a property within the greenbelt. Before appearing on the city council’s agenda, details of these greenbelt acquisitions are not made public – parcels are identified only by their application number.

Farmland Tax Credits

At the commission’s March 9, 2011 meeting, Tom Bloomer – a greenbelt commissioner and farmer who owns Bur Oaks Farm in Webster Township – gave an update on proposed state legislation that would impact farmers. GAC chair Jennifer S. Hall had asked him to provide more details at their next meeting. Because the April meeting was canceled, Bloomer’s first chance to brief the commission again came on Wednesday.

The state’s Farmland Preservation Program – under Public Act 116, the Farmland and Open Space Preservation Act – provides tax credits to farmers. As part of his overhaul of the state’s tax structure, Gov. Rick Snyder has proposed eliminating or reducing most tax credits. The changes would not only affect high-profile tax credits for the film industry, but also would cut tax credits in several other sectors, including brownfield redevelopment, historic preservation, and farmland.

At Wednesday’s meeting, Bloomer distributed a list of talking points regarding the farmland tax credits, and urged people to contact their state legislators about the issue. His points included:

• Michigan farmland assessments are higher than any other Midwestern state.
• Most Midwestern states assess farmland based upon current land use. Michigan assesses upon potential market value.
• Without PA 116 tax refunds, participating Michigan farmers would not be competitive in many areas of the state. PA 116 levels the playing field while holding local units of government harmless.
• With approximately $1 billion in annual tax abatements for all industry in Michigan, $35.9 million was returned to Michigan landowners in 2009 under the PA 116 program.
• Under PA 116, agricultural landowners pay normal property taxes, and then are reimbursed by the state for any property tax liability over 3.5% of household income. Therefore PA 116 is a reasonable benefit for working farms while not rewarding speculative landholders who may have much larger personal incomes.
• Food production is Michigan’s second largest industry, with $81 billion generated from the farm supplier through the food retailer, employing approximately 1 million persons. Production agriculture, with land as the primary resource, is the linchpin of the state’s entire food economy.

Commissioner Mike Garfield asked about the status of the legislation that includes changes to PA 116. Bloomer didn’t know. [The state Senate passed a tax reform package the following day that included cuts to farmland tax credits. It will return to the House to be reconciled for a final vote there – the Republican-led House has already approved a version of the legislation – before going to Snyder for his signature. Clarification: The legislation repeals PA 116 credits only as part of a broader repeal of the Michigan Business Tax. For individual filers, PA 116 credits would remain unchanged. Also, taxpayers could choose to continue filing the MBT – in that case, they would also continue to receive the PA 1116 credits.]

Commissioner Gil Omenn said he knew people were getting primed to testify about the tax changes at upcoming legislative hearings, but he wasn’t sure if the agricultural industry was represented. “We should hurry if we’re trying to make an impact,” he said.

Since the changes wouldn’t take effect until next year, Bloomer suggested that one strategy could be for farmers to sign up this year for the credits – contracts are for a minimum of seven years, but it’s possible to get the credits for up to 99 years, he noted. He said those would remain in place even if the credits are eliminated in future years. Contracts for the tax credits stay with the property even if ownership changes hands, he said – the only thing that would void the credits is if the land is used for something other than farming.

Commissioner Peter Allen said that if farmers feel their taxes are too high, they can always appeal that assessment. Yes, Bloomer replied, but the reality is it’s rare to win an appeal.

Allen noted that many of the tax credits slated for elimination – including historic preservation and brownfield credits – would really hit the real estate industry hard. [Allen is a local developer.] Now, some legislators are trying to find ways to soften that impact, he said. But the idea is to get everyone back to the same base, he noted – and taking away subsidies is part of that agenda for Snyder.

Bloomer reiterated one of the points in his handout – that neighboring states assess farmland based upon current land use, not potential market value. That puts Michigan farmers at a disadvantage, he said, and that’s what PA 116 was designed to address. It penalizes people who hold land for speculative purposes, he said, making it expensive for them to stockpile land for development. Allen noted that the pendulum is swinging on that – given the economy, there’s much less interest from developers.

GAC Membership Term Limits

Mary Fales from the city attorney’s office was on hand to update the commission about member terms. She had drafted a resolution to restate GAC’s membership terms.

GAC chair Jennifer S. Hall introduced the issue by noting that at their Nov. 10, 2010 meeting, she had mentioned that her term and the term for Gil Omenn would be ending as of June 30, 2011 – she had encouraged anyone who was interested to contact their city council representative. [For most city boards and commissions, the mayor is responsible for nominating members, and those nominations are voted on by the city council. However, GAC and the environmental commission differ in this respect – for those bodies, nominations are made by city councilmembers.]

At the time, in response to a query from The Chronicle, she had looked at information about terms on the commission and found some inconsistencies, and had asked the city attorney’s office to sort it out.

Fales said she conducted an historical audit, reviewing all GAC resolutions since its inception. She provided a handout that showed the history of GAC membership, beginning with inital appointments in 2004. [.pdf file of GAC membership]

There had been confusion because some commissioners had resigned in the middle of their terms. In other cases, there had been a delay between the time a term ended, and the point when city council reappointed that commissioner. The research Fales conducted also found that two council resolutions of appointment – in 2008 and 2009 – included incorrect term years.

The resolution that GAC was asked to consider on Wednesday restated the current terms, Fales said, aligning the start dates to all fall on July 1, over staggered years. The restated terms, all for three years, are as follows:

• Jennifer Santi Hall (public at large): July 1, 2008 – June 30, 2011
• Gil Omenn (public at large): July 1, 2008 – June 30, 2011
• Catherine Riseng (biologist): July 1, 2009 – June 30, 2012
• Mike Garfield (environmental organization): July 1, 2009 – June 30, 2012
• Peter Allen (real estate): July 1, 2009 – June 30, 2012
• Tom Bloomer (agricultural landowner): July 1, 2010 – June 30, 2013
• Laura Rubin (environmental organization): July 1, 2010 – June 30, 2013
• Dan Ezekiel (public at large): July 1, 2010 – June 30, 2013

Fales noted that the most interesting gap was Garfield’s. He was appointed to a two-year term from 2004-2006, then a three-year term from 2006-2009. That term ended on June 30, 2009, but the city council didn’t reappoint him until Sept. 21, 2010. Catherine Riseng was reappointed on that same date – she was appointed to fill a partial term following the resignation of Sylvia Taylor.

The ordinance governing GAC appointments states that commissioners can serve for 60 days after their term expires. Garfield indicated that this meant his votes during the gap could be invalidated. Fales replied that the resolution restating GAC terms would fix that – it sets Garfield’s appointment as starting on July 1, 2009.

Fales said she expected Carsten Hohnke – the city councilmember who serves on GAC, but who was absent from Wednesday’s meeting – would sponsor the appointment resolution at council, but she hadn’t talked to him about it yet.

Omenn asked about the city council slot on GAC – it wasn’t included in the resolution. Fales reported that the council selects a councilmember to serve on GAC each year, and that’s handled separately.

Commissioners are allowed to serve two consecutive, three-year terms. If they are appointed mid-term to fill a vacancy after another commissioner resigns, they can still be appointed to two full terms after that, Fales said.

Outcome: The commission voted unanimously to recommend that city council adopt the restated GAC membership terms.

Update on Federal Farm and Ranchland Protection Program

Ginny Trocchio of The Conservation Fund, which is under contract with the city to manage the greenbelt program, gave a presentation to commissioners on changes made in the 2008 farm bill to the federal Farm and Ranchland Protection Program (FRPP). The primary changes relate to a new certification process, and to land eligibility and scoring criteria used for grant funding. The greenbelt program has received several million dollars worth of FRPP grants, and has additional applications pending.

Entities can now become certified by the state conservationist, who makes recommendations for certification to the U.S. Natural Resources Conservation Service chief for final approval. Becoming certified has no impact on an entity’s ability to get FRPP funding, Trocchio said, but it does streamline the review process and gives more responsibility to the certified entity for program management.

To become certified, an entity must hold at least 25 conservation easements, including five FRPP easements obtained over the past five years. Easements that are held by another partner – even if the greenbelt program has contributed funding – don’t count, she said. [In general, conservation easements are deed restrictions limiting the amount of development that can be done on the site, in exchange for certain tax benefits.]

The city holds 13 conservation easements now, she said, and another three deals are expected to close by year’s end. Ten of those have used FRPP funds.

Another criteria is closing efficiency – referring to the amount of time it takes to complete a transaction. Entities must have an average closing efficiency of 18 months or less for FRPP projects, over the past 5 years. The city has a 10-month average for closing, Trocchio said.

Ann Arbor is one of the entities in Michigan that’s closest to meeting certification requirements, she said, noting that it’s possible to ask for waivers for some of the requirements.

Commissioner Peter Allen asked for her opinion about whether the city should seek a waiver and apply for certification. Trocchio said she had some concerns. For one, no one has yet gone through the certification process, and details about how that might occur are still being worked out. She said she’d want to get more information before taking action. What’s more, these changes were in the 2008 farm bill, even though it’s just now being rolled out. Negotiations are about to begin for the 2012 farm bill, she noted, which could bring additional changes.

She said another possibility is to look at getting Land Trust Alliance accreditation for the greenbelt program.

Allen asked what would happen if federal tax subsidies are turned inside out, and the FRPP program is eliminated.

Peg Kohring, a manager with The Conservation Fund, said she’d recently talked with an aide for U.S. Sen. Debbie Stabenow, who chairs the Senate Committee on Agriculture, Nutrition, and Forestry. The aide had reported that since production is down worldwide, there will likely be fewer subsidies, and those that remain in place will focus on driving production. Farmland preservation would be well-positioned for that scenario, Kohring said.

Kohring also noted that if the city pursues Land Trust Alliance accreditation, there are a number of policies that they’d need to put in place, beyond the basic policies they’ve already adopted. GAC might think about directing Trocchio to look into what’s needed in order to get accreditation, she said.

Trocchio then discussed changes to the FRPP land eligibility and scoring criteria. Under the new criteria, up to 66% of land eligible for FRPP funds may be forest land, she said. Previously, at least 50% of land had to be in agriculture production. The scoring criteria still favors larger parcels, she noted – parcels under 30 acres receive no points in the scoring.

Additional criteria have been added for the ratio of the land being considered for an FRPP grant to the county’s average farm size. In Washtenaw County, the average farm size is 128 acres. If the ratio is less than one, zero points are awarded.

Ezekiel noted that many large farms outside of the greenbelt’s boundaries to the west cause the average farm size to be higher. Farms inside the greenbelt tend to be smaller, and that puts them at a disadvantage with this scoring criteria, he said. Kohring observed that they should consider this fact when looking at potentially changing the greenbelt boundaries. Unless some of those larger farms get included within the greenbelt boundaries, the program won’t be as competitive for FRPP grants, she said.

Staff, Committee Reports: Joint Meeting, Greenbelt Boundary

Ginny Trocchio reported that a joint working session of the greenbelt and park advisory commissions will be held on Tuesday, June 7. That means GAC will not hold its regular meeting on June 8, she said. [The two commissions last held a joint session in April 2010.]

Trocchio also reported that Thursday, June 16 is the date for a greenbelt celebration, starting at 5:30 p.m. at the Braun farm in Ann Arbor Township, which was added to the greenbelt program in 2010. It will be open to the public, she said, and will include a presentation to highlight the program’s accomplishments. Trocchio said she expects the program will close on several deals over the next few months that will push the amount of protected land over the 3,000-acre mark.

At GAC’s next regular meeting on July 13, Trocchio said the agenda will include a presentation on Scio Township’s land preservation efforts. The township recently went through some strategic planning, working with consultant Barry Lonik, and they’ll come to share their priorities with GAC, she said.

Dan Ezekiel, GAC’s vice chair, reported that the subcommittee he’s leading to look at possible changes in the greenbelt boundary will be making a proposal at the July meeting. Any changes to the boundaries would also require approval by the city council.

Several commissioners expressed their thanks to Jennifer S. Hall and Gil Omenn. Mike Garfield praised their remarkable service, noting that they’d both been involved in the original campaign to launch the greenbelt program. The program has been built up over the years, he said, “and you’ve both contributed enormously to this.”

Peter Allen suggested they throw a party in honor of Hall and Omenn – and jokingly asked if Omenn could host it at his house.

Hall said that leaving the commission will mark the end of her current span of service with the city – she no longer serves on any other city board or commission. She noted that her first appointment was to the planning commission in 2003, and that she was glad her final meeting was back at city hall. “It just feels right to end here.” [GAC and other city groups have been meeting for the past year or so at the county administration building, during renovations to city hall. The May meeting was the first time GAC had returned to city hall.]

Greenbelt Acquisition Recommended

The commission entered closed session to discuss land acquisitions. After emerging, they unanimously passed a resolution recommending that Ann Arbor city council make a $127,200 offer for the purchase of development rights for a property within the greenbelt boundaries.

Before appearing on the city council’s agenda, details of these greenbelt acquisitions are not made public – parcels are identified only by their application number. In this case, the parcel number is 2011-05.

Dan Ezekiel was the only commissioner to comment on the offer, calling it a wonderful property. He said it’s an example of the synergies they’re starting to see when development rights acquired on one property can provide the proceeds to start the process for another one – in this case, expanding a block of excellent farmland, he said.

Present: Peter Allen, Tom Bloomer, Dan Ezekiel, Mike Garfield, Jennifer S. Hall, Catherine Riseng, Laura Rubin, Gil Omenn

Absent: Carsten Hohnke

Next regular meeting: Wednesday, July 13 at 4:30 p.m. in the second-floor council chambers at city hall, 301 E. Huron St., Ann Arbor. The commission will hold a joint working session with the park advisory commission on Tuesday, June 8. [confirm date]