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The SALCI Initiative

Small Agricultural Land Conservation Initiative (SALCI)

Preservation of farmland is a top priority for the Institute to ensure the sustainability of New Mexico’s local food supply.  Small family farms are disappearing fast due to development pressures, subdividing and the transfer of water rights to urban areas.  In collaboration with the local Land Trust community, the Institute convened SALCI because of a shared belief that small agricultural landowners should qualify for tax credits when they put their land into a conservation easement.  Tax credits would help offset the cost of doing an easement, but so far, owners of smaller agricultural parcels don’t qualify.  Through education and policy making, the Institute hopes to change this precedent.

 

SALCI Resolution

 

The State of New Mexico has a great program for people who put their land into conservation easements that allows property owners to sell their tax credits that they earn when they take the development rights off their land.The income from selling the tax credits often covers the cost of doing an easement and can also be large enough to financially reward the landowner for doing so.In order to be eligible for federal and state tax benefits, a donated conservation easement must meet strict federal and state standards.Among other requirements, the land subject to the easement must meet at least one of five conservation purposes, including:(1) the protection of relatively natural wildlife habitat; (2) the preservation of historic areas or structures; (3) the preservation of land for the recreation or education of the public; the preservation of open space (including agricultural land) either (4) for the scenic enjoyment of the general public or (5) pursuant to a clearly delineated governmental conservation policy and that will yield a “significant public benefit”.

The State of New Mexico Natural Lands Protection Committee, which reviews conservation easements and approves tax credits for landowners, has questioned the existence of clearly delineated governmental conservation policies for the preservation of agricultural parcels.So SALCI created a resolution and got it passed in January 2010 that provides the clearly delineated governmental policy within Santa Fe County. Now that the resolution is done, we are providing it to other counties to make it easier for farmers to qualify for tax credits if they put their land into an easement.The SALCI resolution was passed April 13th 2010. Below you will find a PDF of the resolution in its entirety.

SANTA FE COUNTY Resolution No. 2010-60
 For a copy of the document click here

SALCI is one hot initiative

SALCI is the acronym for the “Small Agricultural Land Conservation Initiative.”  It’s a strange name for a concept that the Institute and all of the area’s land conservation groups feel is very important:  namely that small agricultural land owners should qualify for tax credits when they put their land into conservation easements.  Tax credits would help offset the cost of doing an easement, but so far, small ag land owners don’t qualify.

The Small Agricultural Land Conservation Initiative (SALCI) was convened by the Institute in May 2009 to identify viable means of preserving small agricultural parcels in New Mexico in a way that rewards a family for the equity they’ve built up in the land and  honors the cultural and agricultural traditions inherent in the land.  Throughout the southwest, agricultural lands are disappearing fast, and the members of SALCI want to be sure that we do all we can to help keep land accessible for future generations of agricultural producers so that New Mexico’s agricultural heritage is maintained, furthering the sustainability of the New Mexico food system and the food security of all New Mexicans.

A long term commercial vending site

According the the NM Department of Agriculture, between 2000 and 2005 New Mexico lost over 200,000 acres of farmland and 500 farms.  With the completion of the $5 million Santa Fe Farmers’ Market Building, northern New Mexico agricultural producers now have a commercial vending site for the next 80 years, and we want to ensure that the northern NM agricultural community will be able to provide a growing and abundant food supply to the facility for generations to come.  Preservation of farmland is a top priority for us.

Land Conservation

The State of New Mexico’s primary emphasis in putting land into conservation easements focuses primarily on two issues:  its scenic value and its value as a wildlife habitat.  While both of these issues are very important, the Small Ag-Land Conservation Initiative feels that the Natural Land Protection Committee must also consider the value that small agricultural parcels bring to the State.  According to the New Mexico Department of Agriculture, in 2004, there were 17,500 farms in New Mexico, of which 3,586 are considered small farms of 1-9 acres.  These smaller farms provide owners with direct sales opportunities to consumers via farmers markets and other venues totaling more than $6.6 million in sales annually.  Small farms provide food and enhance our food security.  They provide economic development opportunities, rural sustainability and help to preserve our State’s agricultural heritage.  Small farms, especially in the north, are often irrigated and therefore tie water rights to the land and to rural communities.

But by focusing mostly on scenic value and wildlife habitat, the State more often grants conservation easements to larger (often dryland) parcels.  These larger parcels routinely qualify for the State’s transferable tax credits, which help to pay for the high cost of putting land into a conservation easement and often reward the landowner for doing so.

The State, however, has not yet awakened to the value of small (often irrigated) farms for New Mexico’s future food security and will not grant tax credits for their protection through conservation easements.  As more and more farmland is developed and water rights transferred to urban areas, the members of SALCI feel it is imperative to address this situation to preserve farmland to ensure the sustainability of New Mexico’s local food supply.

SALCI and the PCU (Permaculture Credit Union)

SALCI created a bridge loan program with the Permaculture Credit Union that would loan the cost of creating conservation easements to property owners and allow them to pay it back using state tax credits.

The Permaculture Credit Union (PCU) will administer the bridge loans to preserve farmland as follows:

  • Each participating land trust organization and the Institute will put in $10,000.
  • The Permaculture Guild will match each $10k contribution with $5k.
  • Each land trust group and the Institute will then have $15,000 to offer a client that wants to put his/her land into an easement.
  • If a loan is smaller than $15,000, the land trust or Institute will put in 2/3 of the amount needed, Permaculture Guild will add 1/3.  PCU freezes money into program use area so it will be available when needed.
  • Loan money must be used for mineral reports, appraisals and land trust staff costs.  Appraisals will be paid by PCU to the land trust or the land trust working on behalf of the Institute in the name of the client.
  • The land trust or Institute sends PCU a letter stating the name of the applicant for the bridge loan.
  • A credit report is done.  Client must have 36% debt ratio.
  • Only A and A+ customers will qualify initially.
  • The interest rate will be 8.75% for the A’s and 7.75% for the A+ customers.
  • Money will be loaned out incrementally as needed, first for the preliminary work done by the land trust, then for the appraisal and other professional services.
  • The client only pays interest on the loan until the tax credit comes back to pay off the loan.
  • Loans must be paid back in 48 months.
  • No penalty for early payment.
  • No fees.
  • Security:  The land trust’s and the Institute’s money is at risk first, followed by the Permaculture Guild money.
  • The loan can be canceled at any time by either the client or the land trust organization or Institute.

Please help us by making a tax-deductible donation to the Bridge Loan Project to Preserve Farmland at the Santa Fe Farmers’ Market Institute.  This could be one of the most significant contributions you make this year, as we work to preserve farmland for the food security of our community and the long-term sustainability of the Santa Fe Farmers’ Market.

Many thanks to the Frost Foundation for funding the work of SALCI.  We wouldn’t have been able to make so much progress without their support.

Members of SALCI include:

Ernie Atencio, Taos Land Trust
Connie Falk, New Mexico State University
Kristina Gray Fisher, Think New Mexico
Reese Fullerton, State of New Mexico
Alan Hamilton, NM Wildlife Federation, Rio Grande Return Nora Haskins, Permaculture Guild
David Henderson, Santa Fe Farmers’ Market Institute
John Hesse, Commonweal Conservancy
Tawnya Laveta, Farm to Table
Cecilia Rosacker McCord, organic farmer/Rio Grande Agricultural Land Trust
Matthew McQueen, land trust attorney, lead consultant
Brendan Miller, NM Economic Development Department
Sarah Noss, Santa Fe Farmers’ Market Institute, convener/coordinator
Quita Ortiz, New Mexico Acequia Association
Rici Peterson, Santa Fe Conservation Trust
Don Sarich, Permaculture Credit Union
Michael Scisco, New Mexico Land Conservancy
Bud Starnes, New Mexico Department of Agriculture