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The Pennsylvania Agricultural Conservation Easement Purchase Program empowers county governments, in partnership with state government, to protect productive farmland from non-agricultural development. Easements have been purchased on hundreds of thousands of acres from farmers using state funds, county tax receipts, and other funds.
The Pennsylvania Agricultural Conservation Easement Purchase Program (ACEPP) is a voluntary program that enables county governments to protect active farmland by purchasing agricultural conservation easements from willing landowners. These easements limit the use of farmland to activities compatible with agriculture, while keeping the land in the landowner’s ownership and control. Currently, 58 counties participate in the program.
Farmers in counties with an agricultural land preservation board (a “county board”) may apply to have one or more of their farm parcels considered for easement purchase. The farm must be located in a qualifying agricultural security area. With farmer demand far exceeding available government funding, only farms with the best soils and other key characteristics rank high enough to receive easement purchase offers. Easements may be purchased using state, county, or other funds secured by the county.
ACEPP has been tremendously successful, protecting 622,000 acres since 1989 and making Pennsylvania a national leader in farmland preservation. Beyond saving particular productive farms for ongoing food production, the program stabilizes local farming economies by assuring farmers and farm-related enterprises that there is a stable, permanent base of agricultural land in their communities.
The program is overseen by the Pennsylvania Agricultural Land Preservation Board. The Pennsylvania Department of Agriculture Bureau of Farmland Preservation manages ACEPP and oversees county board activity.
The Pennsylvania Agricultural Land Preservation Board (the “state board”) reviews and approves the establishment of county boards. Wherever an easement is intended to be funded in whole or in part with state funds, the state board reviews, approves, or denies easement recommendations of county boards, and executes the purchase agreements on behalf of the Commonwealth.
A county board must be composed of five, seven, or nine members appointed by the county governing body. The board establishes standards and procedures, within the parameters set by state law, to guide the selection of properties for preservation.
The state—by means of its Environmental Stewardship Fund and a portion of its cigarette tax revenue—provides funds for easement purchases. These funds are allocated between counties according to a formula set forth in the Agricultural Area Security Law.
Counties may also use county general funds, proceeds from borrowing, federal programs, and funding from local municipalities and private sources to support easement purchases.
Demand by farmers to sell easements on their farms has consistently exceeded funding, resulting in long backlog lists of farms that have been selected by county boards for easement purchases but have not yet been preserved.
Counties may use a variety of strategies to stretch the impact of the funds they do have, including capping purchase prices or utilizing challenge grant programs to incentivize landowners and municipalities to raise additional funds.
Rather than going through ACEPP or otherwise selling easements to a public body, farmers can instead permanently protect their farms by donating or selling conservation easements to private charitable land trusts. The public and private alternative have different features and pros and cons, which are compared and contrasted in the guide Farm Preservation Options for Landowners.
Properties must meet the state’s basic requirements for the purchase program, listed below:
Each county board establishes a ranking system for properties based on the state’s minimum requirements and subject to approval by the state board. Counties must make purchase offers to farmers strictly in accordance with the ranking of applications under the county’s ranking system. A county must offer to purchase the highest scoring farm(s) first.
Though the state board mandates much of the ranking system, each county makes a number of decisions regarding the scoring and weighting of different factors. Counties are required to use the Land Evaluation and Site Assessment system. This assessment is based on a land evaluation, which examines the quality of soils, and a site assessment, which evaluates the development potential, farmland potential, and the potential to create a clustering of preserved farmland. The weighted values of the factors must total 100% and fall within the following ranges:
Land Evaluation 40 – 70%
Development Potential 10 – 40%
Farmland Potential 10 – 40%
Clustering Potential 10 – 40%
During the land evaluation process, counties must designate the source of the soils data and measure the value of the soil based on a 100-point scale, with 100 points indicating the best soils for agricultural production.
Either or both of the following may be used for soils data: (1) The county soil survey, as published by the USDA-NRCS in cooperation with the Pennsylvania State University and the Department of Agriculture; or (2) The Soil and Water Conservation Technical Guide published and updated by the USDA-NRCS.
The three general factors comprising the site assessment are described in detail below.
Development Potential: factors that identify the extent to which development pressures are likely to cause conversion of farmland to non-agricultural uses. county boards must use the three factors specified below and may use as many as seven additional factors.
Farmland Potential: factors that measure the potential agricultural productivity and farmland stewardship practiced on a property. County boards must use the four factors specified below and may use as many as six additional factors.
Clustering Potential: factors that emphasize the importance of preserving blocks of farmland to support normal farming operations and help to shield the agricultural community from conflicts with incompatible land uses. County boards must use the three factors specified below and may use as many as seven additional factors.
The county board appraises the value of proposed conservation easements on farms with the highest ranked applications.
The appraisal must be in accordance with the most recent edition of the Uniform Standards of Professional Appraisal Practice and estimate both the market value and the farmland value of the land. County boards may choose to refer to one or more appraisal reports conducted by a state-certified general real estate appraiser.
The value of an easement is the difference between the market value and the appraised farmland value. The purchase price offered for the purchase of an easement may not exceed, but may be less than, the value of the easement.
If landowners disagree with the appraisal produced by the county board have the right to commission their own appraisal, which may result in adjustment of the appraised value if it shows a market value higher than the county’s appraisal, or an appraised farmland value lower than the county’s appraisal.
People often refer to the county boards “purchasing development rights” instead of “purchasing conservation easements.” The latter phrase is a far more accurate description. The counties do not actually obtain development rights; rather, they obtain a right to block development.
Specifically, the following happens in the purchase of an agricultural conservation easement: The landowner places a restrictive covenant on their land that restricts the land’s use to agricultural production and certain other activities; this is accomplished by recording a “Deed of Agricultural Conservation Easement.” In the deed, the landowner grants the relevant government units the right to enforce the restrictive covenant. The county pays the landowner for forever restricting the use of the land, which serves the public’s interest in permanent protection of agricultural land uses that might otherwise be lost to short-sighted market forces.
In 2008 the Legislative Budget and Finance Committee conducted a program audit of ACEPP per Senate Resolution 2007-195. The audit report’s 67 pages (and nine-page summary) covered a wide array of issues and concluded that:
Pennsylvania has one of the most successful, if not the most successful, farmland preservation programs in the country. The ACEPP program, with its emphasis on quantitative rankings and local land use decision-making, is widely viewed as a model for selecting and preserving agriculturally important farms.
The audit report noted concerns about the program related to Internal Revenue Code requirements for federal charitable tax deductions for farmers who sell their easements for less than fair market value:
The Pennsylvania Land Trust Association (PALTA) [now known as WeConservePA] has expressed concern about several aspects of the ACEPP program and the applicability of the federal charitable contribution deduction to a bargain sale easement. Specifically, PALTA cites the lack of restrictions on agricultural buildings’ size, quantity, or location as possibly running afoul of the “conservation purposes” test of Internal Revenue Code §170(h).
ACEPP was created through Act 149 of 1988, which amended Act 43 of 1981 (known as the Agricultural Area Security Law). Act 43, last updated in 2013, enables participating counties to establish a county board to protect farmland by purchasing agricultural conservation easements on eligible properties, and establishes a program and standards for allocating state funds to support these acquisitions.
The Agricultural Area Security Law initially provided that ACEPP easements could be extinguished after 25 years under certain, very particular, conditions. Act 44 of 2011 repealed that provision.
