Patterson’s proposed farmland mitigation fee is contested

This city has created a stir with a proposed farmland mitigation fee of $2,000 an acre.

Some officials said it’s not nearly enough to comply with a countywide policy for protecting farmland from urban sprawl. Others who defend the fee said it’s reasonable and close to what other growth-minded cities charge in the Northern San Joaquin Valley.

The issue is bound to stir discussion about how much cities should collect from development to purchase easements from farmers so the best farmland is not destroyed by sprawl.

City staff members recommended the City Council adopt the fee at a special meeting that was to be held Thursday, to satisfy the agricultural preservation policy of the Local Agency Formation Commission, approved in 2012 after years of political wrangling in Stanislaus County.

The $2,000 an acre is not based on a study of current land values, but was recommended by the building industry.

“I am just shocked by this,” said Board of Supervisors Chairman Jim DeMartini, who was angry about language in a city report that seemed to challenge LAFCO’s authority.

Denny Jackman, a former Modesto councilman and leading advocate for preserving farmland, said, “C’mon,” when he heard about the proposal. “It’s almost laughable,” he said Thursday. “They need to get close to today’s ballpark so they don’t set themselves up for a fall. ... The LAFCO board will decide whether they consider that a rational amount.”

Patterson City Manager Ken Irwin said Thursday afternoon that the special meeting was canceled for lack of a quorum because two council members were ill. It was the third time in three months the matter has been continued.

Irwin, who officially was promoted to city manager three weeks ago, said he didn’t know if the item would be considered at the next council meeting Nov.18.

“We were going with what the Planning Commission had recommended,” Irwin said. “I am still learning more about the ag mitigation that LAFCO requires.”

Marjorie Blom, executive officer of LAFCO, has suggested the city take its time and prepare a study to substantiate the fee amount. Her letter to Irwin this week said that $2,000 an acre is significantly less than a city estimate two years ago that buying farmland conservation easements would cost $3,500 to $15,000 an acre.

Blom questioned whether $2,000 per acre is sufficient when most land surrounding Patterson is considered highly productive for growing crops. The LAFCO policy essentially requires that one acre of farmland “of equal or better soil quality” be preserved for every acre converted for housing, Blom wrote in a letter to Irwin this week.

Most cities in the county have not established farmland mitigation fees, apparently because of the lack of building activity. Before the recession hit, Stockton adopted a $9,600-per-acre mitigation fee based on a study of conservation easements. San Joaquin County’s fee is $8,675 per acre.

LAFCO is made up of representatives from the county, cities and the public, and oversees city annexations to ensure sensible urban development. According to the 2012 policy, cities must include a method for minimizing the loss of farmland when submitting an annexation plan to LAFCO.

Cities can assess a fee on development to generate funds for buying conservation easements. Another way to comply is a voter-approved urban growth boundary, such as the one approved by Newman voters this week.

DeMartini, a LAFCO commissioner, said a $2,000-per-acre fee would be “dead on arrival” if submitted with an annexation plan. He advised Patterson officials to talk with LAFCO staff about ways to comply with the policy.

John Beckman, chief executive officer of the Building Industry Association of the Greater Valley, recommended the fee amount in a May 9 letter to former Patterson City Manager Rod Butler.

Beckman said Thursday that it’s a reasonable amount to pay farmers for easements. “They are choosing to look at the two most expensive examples in our area (Stockton and San Joaquin County), as opposed to the far less expensive examples in Lathrop, Tracy and Manteca,” Beckman said. “It’s all a matter of your point of view. Are you looking to set your fees to hinder development, or are you looking at a reasonable way to protect farmland while you allow development to continue.”

Beckman noted that Patterson’s proposal is close to the fees in Manteca, Lathrop and Tracy, which range from $2,000 to $3,000 an acre. Manteca confirmed it collects $2,511 an acre when a developer converts fertile land to an urban use.

The Stanislaus County Farm Bureau sent a comment Thursday to Patterson contesting the proposed fee.

“It would nowhere near cover the cost per acre of mitigation for farmland,” Executive Director Wayne Zipser said. “With farmland going for over $30,000 an acre, it would be hard to put an easement on an acre of land for $2,000. ... You need people who are willing to put an easement on their property, and it is going to cost an amount of money.”

Zipser said conservation easements around Modesto are costing $8,000 to $10,000 an acre.

Patterson wants to work with other cities to create a mitigation bank for purchasing easements. According to a staff report, the owner of a large tract of land could sell easements on a piecemeal basis to developers until the entire area is preserved.

Beckman explained that a developer with a 10-acre project is more likely to find a farmer who wants to put 40 to 100 acres in an easement. The developer could meet the requirement by simply paying into the mitigation bank.

This story was originally published November 6, 2014 at 7:46 PM with the headline "Patterson’s proposed farmland mitigation fee is contested."