Economic Benefits of Working Lands

Pennsylvania data for the 2012 Census of Agriculture conducted by the U.S. Department of Agriculture. Study finds that agriculture in Pennsylvania is a $7.4 billion industry.

The Census of Agriculture is a census conducted every five years by the U.S. Department of Agriculture's National Agricultural Statistics Service that provides the only source of uniform, comprehensive agricultural data for every county in the United States. Files below for entire report and Pennsylvania data. In Pennsylvania, agriculture is a $7.7 billion industry.

Organized into nine topics, this report analyzes the economic impact of agriculture and related industries. Nationwide, agriculture supports 21 million jobs.

As the Pennsylvania farmland preservation program enters its 30th year, this is the first formal analysis of its economic impact. The value of such an analysis is to 6 estimate the benefits to the agricultural industry, the state’s economy, and the counties where the preserved farms are located. To assess the contribution of the state/county farmland preservation program to the Pennsylvania state economy, the study estimates a multiplier effect and also estimates the annual contribution of preserved farms to the agricultural economy and the general economy of the state.

This study analyzes the economic benefits of the Pennsylvania state forest system, including timber sales and money generated by outdoor recreation activities. The research also explored current state forest governance practices, including the payment-in-lieu of taxes (PILT) system that was established to provide monetary payments to local government jurisdictions (county, municipal, and school district) that have non-taxable state forestland within their jurisdictions.

The natural capital in Lancaster County, Pennsylvania, provides a robust flow of essential economic goods and services benefits, including food, water, clean air, natural beauty, climatic stability, storm and flood protection, and recreation. Agricultural lands make up over 65% of the ecosystems in Lancaster County, which is the first county in the nation to reach 100,000 acres of preserved farmland. This analysis identified the natural capital from farmland preservation at $676 million in annual economic benefits. If treated like an asset, Lancaster County ecosystems value at $17.5 billion.

Researchers in Maryland asked: if preserved open space increases property values on adjacent residential parcels, how many additional acres of open space could be preserved using the subsequent rise in property tax revenues? In Calvert County, the increase in tax revenue generated from a 1% increase in preserved agricultural land would be sufficient to purchase an additional 88 acres in the first year and 2,640 acres in 30 years. In Howard County, it would generate sufficient additional tax revenues to purchase 110 acres in one year and 3,300 acres in 30 years. (In Carroll County property values were not found to be affected by proximity to open space.)

The American Farmland Trust compared the costs and benefits of purchasing easements on two farms, one in PA and one in CT. In CT, the benefits of a $44,000 easement include $327,496 of local goods and services are purchased annually and a total local economic impact of the farm operation of $863,315. The benefits of the $393,330 PA easement include $133,964 annualy spent at local businesses for goods and services for the farm, $804/year in recreation benefits and $2,107 /year in direct sales of farm products.

This paper explores how well farmland preservation programs provide the benefits their proponents state they do: food security and local food supply, a viable local agricultural economy, environmental and rural amenities, sound fiscal policy and orderly development.

The creation of riparian buffers in agricultural landscapes can improve water quality, but also take land out of productive agricultural use. However, planting and harvesting of non-timber products (fruits, nuts and ornamentals) can create both environmental and economic benefits, including a gross income of $60,934/hectare per year.

The economic benefits of working forest preservation include revenues from timber, recreation services, the avoidance of having to artificially replace the ecosystem services naturally provided by the forest, and the avoidance of development costs. Utilizing conservation easements rather than fee simple purchases greatly reduces debt service payments and retains at least a modest stream of property tax revenues for the county.

The agriculture industry is a major employer and contributor to the Commonwealth’s economy. Agriculture generates employment and economic activity on 59,000 farms and in every county in the Commonwealth. On-farm agriculture production underpins a large food processing industry and agriculture support services located throughout the state, including bakeries, confectioners, dairy and meat processors, and snack food manufacturers, among others. Pennsylvania’s equine industry includes some of the top breeding farms nationwide and supports a strong racehorse industry. The state’s forest products sector is grounded in hardwoods production, where Pennsylvania ranks first in export grade hardwood. The state has a growing beverage industry, and the state’s landscapers and horticulturalists provide important services to homeowners and businesses, delivering aesthetic appeal, as well as valuable conservation and environmental benefits.

More than just pretty places, preserved open spaces contribute to our local economies and property values, they help us save on everything from health care to recreation, and they perform valuable ecosystem services that naturally improve the air we breathe and the water we drink. Included in this library item are both the full study and a study summary.

To show how a strategy of land conservation is integral to economic health, this report illustrates that parks and open space increase property tax revenue and yields a better return on investment than development. It reviews the economic benefits of farmland preservation, shows how forest cover decreases the cost of treating drinking water, enumerates the economic value of urban trees, and examines the role of parks and open space in attracting businesses and affluent retirees to a community.

Virginia’s natural resources provide approximately $21.8 billion/year in ecosystem services. Of this, state and federal public lands provide $5.1 billion and the more than 700,000 acres of private land under conservation easement provide $520 million. The benefits are derived from a protection of water quality and supply, pollination of crops, forest products, farm products, disturbance prevention, habitat that supports the marine resource harvest and carbon sequestration.

A review of the now quite extensive economics literature on the value of open space, this study covers more than 60 articles published in the past 25 years that use the various methodologies. The analysis focuses primarily on the value of open space in and around urbanized areas, including parks, greenbelts, natural areas and wildlife habitats, wetlands, and farmland.