EQUITY IN AGRICULTURE: PRESERVING THE VALUE OF DELAWARE'S RURAL LANDS
Equity in Agriculture • Resources • Commentary • Myths and Misconceptions • Frequently Asked QuestionsFrequently Asked Questions
- What are the objections farmers have to HB 280?
- What are the arguments in rebuttal?
- Why should farmers support this bill?
- What are the arguments of developers in opposition to this bill?
- How are their economic self-interests served by the bill?
- What is the objective of the upcoming legislation on "Transfer of Development Rights TDR)?"
- How will this legislation buttress HB 280?
- How will it address property owners' rights to do what they will with their land?
- How does HB 280 enhance the economic interests of existing Sussex County residents?
- How does it address or limit further development in coastal Sussex County?
- Why does HB 280 not address Nanticoke and Inland Bay watershed protection issues?
- What were the political trade-offs that led to this omission in the bill?
- What are the arguments that HB 280 is not an unconstitutional "taking?"
- Is the only state option the purchase of agricultural land when it has objections to a development?
- Why is there no legislation that would require County authorities to impose impact fees on developers or some other pooling of funds collected from developers to underwrite infrastructure?
What are the objections farmers have to HB 280?
The farmers that object to the bill seem to be interested in selling their land to developers rather than continuing farming. They argue that any law, ordinance, or regulation that reduces their flexibility to sell their land to the highest bidder is a "taking" of private property rights, thus their opposition to HB 280. [BACK TO TOP]
What are the arguments in rebuttal?
Farmers and rural landowners have the right to use their lands for agricultural use and other uses compatible with the rural areas. Despite the fact that these landowners have many lucrative options for the use of their land, they seem to feel that they have the "right" to sell for residential development if that will get them a higher price. Large scale residential development is not appropriate in rural areas, and should not be permitted in order to protect the health, safety and welfare of the public at large.
Reasonable restrictions on land use are the foundation of the modern land use planning practices and regulations that are relied upon to manage land development throughout the country. HB 280 represents such a reasonable restriction. A land use (large scale residential subdivisions) that is detrimental to the character and economic vitality of our rural areas will be discouraged and restricted by HB 280.
Farmers have no more right to individually profit from speculative residential subdivisions than a homeowner in a residential subdivision has the right to profit from selling their house as a future convenience store, car wash, or office building. We enact comprehensive plans and associated land use regulations to ensure the vitality, integrity, and property values in residential areas by restricting property owner's rights to change their homes into incompatible uses. HB 280 is a similar approach, only it is meant to protect the vitality, integrity and property values inherent in a working rural landscape.
The case law regarding constitutional "takings" is clear that a regulation would have to extinguish "all economically viable uses" in order to be considered a taking. HB 280 will enhance many of the lucrative agricultural and other uses available to rural land owners, and cannot be considered a taking. (See Equity in Agriculture , Myth 2) [BACK TO TOP]
Why should farmers support this bill?
Farmers should support this bill because it will protect the future of agriculture in the State of Delaware. The bill will do this by creating a powerful disincentive to large scale residential subdivisions in rural areas. This act will protect the integrity of agricultural and rural areas by: decreasing fragmentation of farmland; reducing complaints about agricultural practices; avoiding legal and other issues that arise from nuisance complaints; ensuring that a critical mass of agriculture remains viable to support the ag-industrial infrastructure in the state; reducing conflicts between farm vehicles and residential traffic; and ensuring larger contiguous tracks of farmland are available for production. Research has shown that protection of agricultural lands increases the value and viability of these lands for agricultural production. Any farmer who is truly interested in farming will be able to appreciate these benefits to their industry. [BACK TO TOP]
What are the arguments of developers in opposition to this bill?
The developers who are opposed to HB 280 have argued against any law, ordinance, or regulation that would limit their flexibility to buy and develop land anywhere in the State. Like the farmers, they consider any such regulatory restriction a "taking." This is their primary argument. There are many other arguments that are used against the bill, including:
- There is not enough land available in growth zones to meet the demand for housing
- There will be severe job losses in the construction industry
- The provision of affordable housing will be effected
- HB 280 will limit people's choices about where to live
- HB 280 will lead to "large lot sprawl"
Our response to the "takings" argument is largely the same as the question above about the farmers. Our responses to the other issues are well documented in the Myths and Misconceptions section. [BACK TO TOP]
How are their economic self-interests served by the bill?
State, county and local government plans are public documents that have been in place for many years. Good developers use these planning documents when deciding where to invest in land to take through the development process. Land that is inside municipalities or in a designated growth zone or development district is often subject to development incentives or zoning which encourage greater densities, and has sufficient physical infrastructure (water, sewer, roads and schools) and public services (police, fire, EMT, social services) to support new development activities. Land in designated growth zones is more expensive to develop because the market has to account for the higher cost of development paying its own way through impact fees and infrastructure upgrades, as well it should. This land is also more valuable because the infrastructure and land use regulations generally allow for more dense development, which translates into more housing units that can be built and sold per acre of land.
Developers who are developing in appropriate growth areas are at a financial disadvantage because they must compete with developers in rural areas who are developing "on the cheap" by avoiding impact fees and other infrastructure related expenses. Developers in rural areas are reaping additional profits by avoiding these expenses. The public is subsidizing these profits because the infrastructure needs of future residents ultimately becomes the responsibility of tax payers. Those members of the development community working in appropriate areas will benefit financially by fair competition between developers who are all paying similar costs for land and infrastructure expenses. [BACK TO TOP]
What is the objective of the upcoming legislation on "Transfer of Development Rights TDR)?"
The objective is to draft legislation which will produce a consistent framework for "Transfer of Development Rights" (TDRs) that can be utilized by all three Counties. The legislation will address uniform incentives and parameters which will make TDRs attractive to both the developers and the property owners wishing to sell their rights. The goal of the bill is to allow rural landowners to benefit from the equity in their land by selling their TDRs, while retaining their ownership and the use of their land for continued agricultural or other rural uses. [BACK TO TOP]
How will this legislation buttress HB 280?
HB 280 will provide a powerful disincentive to residential development in rural areas. Developers should no longer be interested in purchasing rural lands because they will not have the expectation of developing large scale residential subdivisions in these areas. The TDR bill will provide a new incentive for developers to purchase development rights from rural landowners. It will buttress HB 280 because it replaces the potential income stream from developers from fee simple purchase (and eventual residential development) to a sale of development rights (while maintaining and preserving the rural lands). Rural landowners will be able to take full advantage of the equity in their land without having to sell the land for development. [BACK TO TOP]
How will it address property owners' rights to do what they will with their land?
Farmers and rural landowners have been selling their lands for the money, not because they have a particularly intense desire to see their rural lands converted to suburban housing developments. In fact, many are reluctant to see their land converted but cannot turn down lucrative offers from developers. The TDR bill will provide rural landowners with another option for how to take advantage of their equity. If the bill is successful it will provide incentives to make this a very attractive exchange which will benefit both developers and landowners. [BACK TO TOP]
How does HB 280 enhance the economic interests of existing Sussex County residents?
Sussex County is a desirable place to live and an attractive place to move to because of its quality of life. "Quality of Life" is a hard to define term, but to us it means vibrant small towns, beautiful beaches and natural features, and a rural character that makes the County unique. HB 280 will protect and preserve the agricultural industry that is critical to the economy of the County and the State. It will preserve open space and rural lands that contribute to the environmental qualities that draw so many people to Sussex. It will work to limit unexpected public expenditures in services and infrastructure in far flung rural areas where it in unexpected. This will allow the County, State and municipalities to focus their investments where we have all collectively planned to grow. These factors will all enhance the property values, economic interests, and economic development potential of the entire county. It is also worth noting that achieving the goals of HB 280 to have a predictable pattern of land use and urban development are essential to keeping taxes low. Areas of the country which have not been able to do this generally have a very high tax burden because of large expenditures for necessary public services. [BACK TO TOP]
How does it address or limit further development in coastal Sussex County?
HB 280 would only further limit development in the areas of coastal Sussex County that are designated Investment Level 4 and are not in County designated development districts. This area includes the coastal areas from the Kent /Sussex line to the Lewes area. [BACK TO TOP]
Why does HB 280 not address Nanticoke and Inland Bay watershed protection issues?
DNREC's "Pollution Control Strategies" are intended to address these issues. Watershed protection issues are outside the scope of HB 280 specifically, however HB 280 has always been considered one tool as a part of a larger strategy for watershed protection. HB 280 will work to decrease imperviousness in rural areas by avoiding ill placed residential subdivisions, with their attendant impervious rooftops, patios, driveways and subdivision streets. [BACK TO TOP]
What were the political trade-offs that led to this omission in the bill?
There were no trade-offs, and the lack of watershed regulations was not an omission. HB 280 has always been conceived as one tool that is part of a larger strategy that includes detailed "Pollution Control Strategies" for the TMDL watersheds. [BACK TO TOP]
What are the arguments that HB 280 is not an unconstitutional "taking?"
The courts have determined that there are two types of "takings" of private property that may occur as described in the US Constitution. A physical taking occurs when a government entity takes direct control of private property, or allows other to intrude upon it. A regulatory taking occurs when a regulation "goes too far" and eliminates all economically viable uses for a property. The Sprawl Prevention Act will do neither, and thus will not constitute a taking. See our answers above and Equity in Agriculture, Myth 2, for a more detailed answer to this question. [BACK TO TOP]
Is the only state option the purchase of agricultural land when it has objections to a development?
The State, through the Agricultural Lands Preservation Foundation, may only purchase the development rights of farmland that has been voluntarily enrolled in the Agricultural Preservation Program by the property owner. Lands enrolled in this program may not be developed for at least 10 years. The property owner must offer his development rights for sale to the Foundation for the State to consider their purchase. Lands that are subject to development proposals are generally not enrolled in this program, and as such the State does not even have the option to purchase them if opposed to a certain development. Currently the State's options are limited when faced with a proposed development that is in an improper location. This is why HB 280 is so important. [BACK TO TOP]
Why is there no legislation that would require County authorities to impose impact fees on developers or some other pooling of funds collected from developers to underwrite infrastructure?
Although it is not currently required, the use of impact fees to fund infrastructure is a common practice among Delaware's counties and municipalities. In 2001 the state engaged in a detailed study of impact fees with the intention of establishing a statewide fee structure that would direct growth into appropriate areas. The study determined that a statewide impact fee structure was infeasible for a variety of legal, technical, and financial reasons. This was due to many factors, including Delaware's unique centralization of functions normally managed by local governments in other states.
The concept of pooling funds from developers to underwrite infrastructure costs is a promising concept. Variations of this concept are currently used by DelDOT when working to implement complex transportation improvements involving multiple developers. [BACK TO TOP]
