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10 Op.Counsel SBRPS No. 57 (rev.)

Opinions of Counsel index

Agricultural exemption (agricultural production requirement) (gross sales requirement) (Conservation Reserve Program) - Agriculture and Markets Law, §§ 301, 305, 306; Real Property Tax Law, § 481:

For purposes of the Agricultural Districts Law (Agriculture and Markets Law, Art. 25-AA), lands set aside in Federal land conservation programs are within the statutory definition of “land used in agricultural production,” and monies received by a farmer pursuant to such a Federal land conservation program may be used to satisfy the statutory gross sales requirement. [8 Op.Counsel SBEA No. 71 superseded in part]

Our opinion has been requested concerning the eligibility of land set aside in a Federal land conservation program for an agricultural assessment as provided in sections 305 and 306 of the Agriculture and Markets Law (see also, Real Property Tax Law, §481). The specific question concerns the provisions of section 301(4)(e) of the Agriculture and Markets Law, as amended by chapter 398 of the Laws of 1989 and chapter 473 of the Laws of 1999.

In 8 Op.Counsel SBEA No. 71 we concluded that land set aside in a Federal land conservation program was not “land used in agricultural production” within the meaning of the Agriculture and Markets Law. We also advised therein that payments made to farmers under such a program could not be used to satisfy the average gross sales requirement (of $10,000) which is part of the general definition of “land used in agricultural production” in section 301(4).

In apparent response, chapter 398 of the Laws of 1989 thereafter amended the definition of “land used in agricultural production” by including new paragraph (e) within section 301(4):

e. Land set aside through participation in a federal conservation program pursuant to title one of the federal food security act of [1985] or any subsequent federal programs established for the purposes of replenishing highly erodible land which has been depleted by continuous tilling or reducing national surpluses of agricultural commodities.

We were then asked to explain the effect of that amendment upon the real property of a retired farmer with land in three counties who was receiving agricultural assessments in two of those counties for extensive acreage enrolled in the Federal Conservation Reserve Program. The land was maintained in accordance with Federal requirements for a cover crop, but the land no longer produced an average gross sales value of $10,000 or more for the preceding two years as otherwise required by section 301(4).

It was suggested that chapter 398 of the Laws of 1989 was intended to specify that land enrolled in a federal conservation program should be considered eligible for an agricultural assessment, regardless of the gross sales value and that the wording of section 301(4)(e) was purposefully designed so that land enrolled in a federal conservation program would be considered eligible to receive an agricultural assessment without meeting the gross sales value requirements. The original version of this opinion, however, analyzed the statutory language and the materials included in the Governor’s Bill Jacket for chapter 389, and concluded that monies received by a farmer pursuant to such a Federal land conservation program could not be used to satisfy the statutory gross sales requirement.

Thereafter, chapter 473 of the Laws of 1999 was enacted. In part, it adds the following clause after “commodities” in section 301(4)(e): “and such land shall qualify for agricultural assessment upon application made pursuant to paragraph a of subdivision one of section three hundred five of this article, except that no minimum sales value shall be required”. In addition, new section 301(9)(e) was added to provide that “gross sales value” includes “payments received by reason of land set aside pursuant to [§301(4)(e)].” The sponsor’s memorandum for the bill (S.3187-A) enacted as chapter 473 states that the intent of the 1998 chapter was to “address” 8 Op.Counsel SBEA No. 71 and that the original version of this opinion was “adverse to ... legislative intent.” The law has now been clarified: lands set aside in Federal land conservation programs are within the statutory definition of “land used in agricultural production,” and monies received by a farmer pursuant to such a program may be used to satisfy the statutory gross sales requirement. The original version of this opinion is therefore superseded as is any contrary conclusion reached in 8 Op.Counsel SBEA No. 71.

April 10, 1998
Revised November 23, 1999

Updated: