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Agricultural Easements Help Protect Farmland

Q: I’ve been hearing about agricultural easements; what are they?
A: An agricultural easement is a legal property interest that dedicates land to agricultural uses. A landowner who enters into an agricultural easement agreement with an “easement holder” (such as the State of Ohio) agrees to use the land predominantly for agricultural purposes, and forfeits the right to develop the land for other purposes.

Q: Are agricultural easements new to Ohio?
A: Yes. While for many years, Ohio has allowed the use of “conservation easements” (agreements to preserve and maintain private land for its conservation or open space value), Ohio law did not recognize a landowner’s right to enter into an agricultural easement until 1999. The Ohio legislature created the agricultural easement as a separate legal instrument whose primary purpose is to preserve and maintain private land for its agricultural value.

Q: Why would a landowner enter into an agricultural easement?
A: A landowner would place an agricultural easement on the land for any of the following reasons: to protect the land in its agricultural state; to ensure long-term viability of the farm operation; to help create a region dedicated to agriculture; or to receive tax benefits or a payment for the easement.

Q: I’ve heard that the Clean Ohio Fund will provide money for agricultural easements.How will that program work?
A:
Ohio’s Agricultural Easement Purchase Program received $25 million from the Clean Ohio Fund in 2001for purchasing agricultural easements, and a second issuance of $25 million from the Clean Ohio Fund in 2009. The program will provide funds until 2008 to counties, townships, municipal corporations and land trusts to buy agricultural easements from willing and qualified farmland owners. The Ohio Department of Agriculture’s Office of Farmland Preservation runs the program, and has established an application and ranking process to select the farms that will qualify to be paid for entering into an agricultural easement. Information about the program is available at the Ohio Department of Agriculture and through its Web site.

Q: How long does an agricultural easement last?
A: Agricultural easements purchased with money from the Clean Ohio Agricultural Easement Purchase Program must remain as part of the land in perpetuity (forever). If the landowner sells or transfers the land, the agricultural easement will be binding on the new owner and all subsequent owners of the land. Agricultural easements funded through other sources may either be perpetual or may last for a certain term of years, depending upon the agreement made by the landowner.

Q: Who ensures that the land remains in agriculture?
A: The landowner enters into an agricultural easement with a “holder” of the easement. Under Ohio law, the only parties legally authorized to act as holders of agricultural easements are the State of Ohio, counties, townships, municipalities and charitable organizations whose purpose is to preserve agricultural land. The holder has a legal right to monitor the property and ensure that the land remains in agricultural use.

Q: Can a landowner donate an agricultural easement?
A: Yes, and a landowner might qualify for federal income and estate tax benefits for donating an agricultural easement. The State of Ohio currently holds dozens of agricultural easements that were donated, and many land trusts around the state also hold donated agricultural easements.

Q: Does the agricultural easement prevent the landowner from selling the land?
A: No. The landowner maintains ownership rights to the land, and may sell the land at any time. However, the new landowner would be bound by the agricultural easement, and could not develop the land for non-agricultural purposes.

Q.: Does the public have access to agricultural easement land?
A.: No. The agricultural easement does not open the land to members of the public for hiking, picnicking, or any other public uses. The landowner maintains the right to keep uninvited guests off the property.

Q: Does the agricultural easement limit the type of agriculture that may take place on the land?
A: Not unless the landowner agrees to the limitations. Generally, the agricultural easement allows the landowner to conduct any activities that are defined as “agriculture” (such as producing crops, raising livestock, or processing farm products) under Ohio law and are in accordance with all applicable laws and regulations.

5/11/2011

Law You Can Use is a weekly consumer legal information column provided by the Ohio State Bar Association (OSBA). This article was prepared by Peggy Kirk Hall, Director of Agricultural and Resource Law, The Ohio State University Extension.

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Articles appearing in this column are intended to provide broad, general information about the law. Before applying this information to a specific legal problem, readers are urged to seek advice from an attorney.

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