Rule-Making Notices (Hearing Notices)

In Minnesota, counties outside of the metropolitan area can participate in the Greater Minnesota Agricultural Preserves Program. Counties that want to participate must develop an agricultural land preservation plan for review and approval by the commissioner of the Minnesota Department of Agriculture. The plan must identify land for long-term agricultural use and anticipate expected growth around urbanized areas. The designated areas must be adopted as part of the county's comprehensive plan. Landowners that are located within these areas may then place a restrictive covenant on their land, agreeing to limit the land to agricultural or forestry use. The covenant is recorded on the title to the land. In exchange for agreeing to preserve land for long term agricultural use, the landowner receives property tax credits of $1.50 per acre, per year.

Summary of factual data and analytical methodologies

To develop this rule, DATCP consulted a group of stakeholders familiar with and potentially affected by the provisions of the rule. DATCP also collected feedback from local government officials who had experience working with, understanding, and implementing the farmland preservation law.

Analysis and supporting documents used to determine effect on small business or in preparation of an economic impact analysis

This rule will have a generally positive impact on agriculture-related businesses. As part of the farmland preservation planning process, counties are required to inventory and evaluate agriculture-related businesses and services, including agricultural production and enterprises related to agriculture. This process helps to ensure that the impact of agriculture-related business can be measured within the community. By clarifying this requirement in the planning process, the rule may aid communities in accurately capturing the breadth of agriculture-related businesses within the area.

This rule also clarifies farmland preservation zoning standards, encouraging local governments to include agriculture-related enterprises in the zoning district. Most agriculture-related businesses may be allowed in a farmland preservation zoning district either as an agriculture-related use or an accessory use. Though such businesses may or may not collect tax credits, their presence in the district may add additional economic certainty to farmers within the certified farmland preservation district.

There are currently over 15,000 farm owners on approximately 2.8 million acres of farmland claiming farmland preservation income tax credits. There is a statutory cap of $27 million for tax credits claimed for lands subject to farmland preservation zoning.

Effect on Small Business /Initial Regulatory Flexibility Analysis

Rule Summary

This rule interprets the Wisconsin Farmland Preservation Program administered by the Department of Agriculture, Trade and Consumer Protection (“DATCP"). Among other things, this rule does all of the following:

General

•   Creates ch. ATCP 49.

•   Adds to definitions listed under s. 91.01, Stats., and further clarifies certain terms in ch. 91.

•   Provides guidance for applying for and receiving certification of farmland preservation plans and ordinances.

•   Specifies types of ordinance amendments for which certification is required under s. 91.36 (8) (b) 3, Stats.

•   Authorizes additional uses allowed in a farmland preservation zoning district.

•   Specifies information required in an application for a farmland preservation agreement under s. 91.64 (2) (h), Stats.

Definitions

•   Clarifies types of uses that may be listed by a political subdivision as accessory uses and agriculture-related uses.

•   Defines crops and forest management.

•   Adds a definition of base farm tract to provide political subdivisions flexibility in administering this density restriction if they choose to utilize it.

Farmland Preservation Plans

•   Clarifies that a county has one year after the certification expiration date to have its farmland preservation plan certified by the department.

•   Clarifies when counties may request an extension to the expiration of their farmland preservation plan to facilitate coordination with other planning and zoning efforts that may be occurring in the county.

•   Clarifies that any amendment to a certified farmland preservation plan must be submitted to the department for certification.

•   Clarifies that the rationale used for identifying the farmland preservation area must be based on objective criteria. Describes the relationship between the farmland preservation plan and any county's comprehensive plan.

•   Provides technical specifications for the farmland preservation plan map and states that the county must provide the department with the data used to create the map.

Farmland Preservation Zoning

•   Clarifies that nonfarm residences existing at the time an ordinance is certified may be considered permitted uses rather than prior nonconforming uses.

•   Authorizes single-family nonfarm dwellings as conditional uses subject to density restrictions that are as restrictive, or more restrictive, than the density standards under ch. 91, Stats.

•   Describes the types of uses that would qualify as governmental, institutional, religious, or nonprofit community uses.

•   Clarifies that an ordinance certification expires according to the statutory schedule in s. 91.34, Stats., and a political subdivision has a year after the certification expiration date to have its ordinance certified by the department to prevent landowners from losing eligibility to collect farmland preservation tax credits.

•   Clarifies that local governments may request an extension to the expiration of their farmland preservation zoning ordinance to facilitate coordination with other planning and zoning efforts that may be occurring in the town or county.

•   Describes the relationship between a political subdivision's farmland preservation zoning ordinance and the county's farmland preservation plan.

•   Provides technical specifications for the farmland preservation zoning map and states that the political subdivision must provide the department with the data used to create the map.

•   Specifies that the department may withdraw certification of an ordinance if the county farmland preservation plan expires or if the political subdivision adopts an ordinance that fails to comply with ch. 91, Stats.

•   Specifies when an amendment to a farmland preservation zoning ordinance must be submitted to the department for certification.

Farmland Preservation Agreements

This rule:

•   Requires landowners to include in an application for a farmland preservation agreement those lands that the landowner owns yet intends to exclude from coverage under the agreement.

Small Business Affected

This rule will have a generally positive impact on agriculture-related businesses. This rule affects businesses in the following ways:

Farmland Preservation Plans

•   As part of the farmland preservation planning process, ch. 91, Stats., counties are required to describe the rationale used for determining the farmland preservation area. This rule clarifies that the rationale must be based on objective criteria related to characteristics of the land parcels themselves, including the proximity of parcels to agricultural infrastructure and the historical use of the land for agriculture-related purposes. As part of the farmland preservation planning process, counties are required to inventory and evaluate agriculture-related businesses and services, including agricultural production and enterprises related to agriculture. This process helps to ensure that agriculture-related businesses can be measured within the community and aid counties as they continue to plan for the presence of these businesses.

Farmland Preservation Zoning

•   Chapter 91, Stats., allows a political subdivision to locate accessory and agriculture-related uses within a certified farmland preservation district. This rule clarifies the types of uses that may be considered accessory and agriculture-related.

•   Accessory uses, under the rule, include facilities for storing, processing, selling, and housing agricultural products. Such uses primarily support agricultural activities occurring on the farm. These uses can make it possible for a farm to generate income through direct-to-consumer sales, such as a roadside farm, or can add value to a product produced on the farm, such as a cheese processing facility. The rule also clarifies that an accessory use can include those uses that may generate income yet do not conflict with (or may be enhanced by) the farm operation. Listed uses include crop mazes, agricultural tourism, and you-pick operations. The clarification of accessory use facilitates the inclusion of agricultural businesses, particularly small agricultural businesses, within the farmland preservation district.

•   The rule also clarifies that agriculture-related uses include facilities that support agriculture even though the use itself may not be located on a farm. Such uses include facilities that primarily provide agricultural supplies, agricultural equipment, fertilizers, pesticides or other agricultural inputs, or other agricultural services directly to farms. These uses also include manure digesters, facilities that slaughter livestock, and agricultural processing plants. The rule clarifies that political subdivisions may include within a farmland preservation zoning district businesses that support agriculture. Allowing such businesses to locate within a farmland preservation district helps provide these businesses with a potential customer base and may add additional economic certainty to farmers with land in the certified farmland preservation district.

Farmland Preservation Agreements

•   This rule requires landowners who submit an application to the department for a farmland preservation agreement to include in the application all lands owned within an Agricultural Enterprise Area that will not be covered by the agreement. This requirement ensures that landowners claiming tax credits under the agreement will not reserve land for purposes that conflict with the preservation of farmland. This in turn provides added certainty to neighboring farmers that conflicting uses will not threaten the continued agricultural production on their land.

Reporting, Bookkeeping and other Procedures

The proposed rule does not regulate any small businesses and thus there are no reporting, bookkeeping or other procedures in the proposed rule for small businesses.

Professional Skills Required

The proposed rule does not regulate any small businesses and thus there is no profession skill required for small businesses.

Accommodation for Small Business

Many of the businesses affected by this rule are “small businesses." This rule does not make special exceptions for small businesses because the farmland preservation program encompasses agricultural operations of all sizes.

This rule includes provisions that will benefit large and small businesses alike. For example, this rule:

•   Requires counties to consider agricultural businesses, regardless of size, when determining which lands to plan for farmland preservation.

•   Clarifies that certain activities that support and enhance agricultural uses may be located within a farmland preservation zoning district. These activities may include supplemental business ventures that can help support a small agricultural operation, such as agricultural tourism or seasonal activities.

Conclusion

This rule will generally benefit affected businesses, including “small businesses." Negative effects, if any, will be few and limited. This rule will not have a significant adverse effect on “small business," and is not subject to the delayed “small business" effective date provided in s. 227.22(2)(e), Stats.

Agency Contact

Alison Volk, Division of Agricultural Resource Management, P.O. Box 8911, Madison, WI 53708-8911; email [e-mail]; telephone [phone].

ADMINISTRATIVE RULES FISCAL ESTIMATE AND ECONOMIC IMPACT ANALYSIS
Type of Estimate and Analysis
X Original ⍽ Updated ⍽ Corrected
Administrative Rule Chapter, Title and Number
Ch. ATCP 49, Farmland Preservation
Subject
Wisconsin Farmland Preservation Program
Fund Sources Affected			Chapter 20 , Stats. Appropriations Affected
⍽ GPR ⍽ FED ⍽ PRO ⍽ PRS ⍽ SEG ⍽ SEG-S
Fiscal Effect of Implementing the Rule
X No Fiscal Effect ⍽ Indeterminate	⍽ Increase Existing Revenues ⍽ Decrease Existing Revenues		⍽ Increase Costs X Could Absorb Within Agency's Budget ⍽ Decrease Costs
The Rule Will Impact the Following (Check All That Apply)
⍽ State's Economy X Local Government Units		X Specific Businesses/Sectors ⍽ Public Utility Rate Payers
Would Implementation and Compliance Costs Be Greater Than $20 million? ⍽ Yes X No
Policy Problem Addressed by the Rule
Wisconsin's farmland preservation program, ch. 91, Stats., was repealed and recreated under 2009 Wis. Act 28. There are no rules in effect related to the farmland preservation program. This rule is necessary to provide clarity to counties updating their farmland preservation plans, local governments writing farmland preservation zoning ordinances, and landowners applying for farmland preservation agreements. The rule does all of the following: •   Creates ch. ATCP 49. •   Adds to definitions listed under s. 91.01, Stats., and further clarifies certain terms in ch. 91. •   Provides guidance for applying for and receiving certification of farmland preservation plans and ordinances. •   Specifies types of ordinance amendments for which certification is required under s. 91.36(8)(b)3, Stats. •   Authorizes additional uses allowed in a farmland preservation zoning district. •   Specifies information required in an application for a farmland preservation agreement under s. 91.64(2)(h).
Summary of Rule's Economic and Fiscal Impact on Specific Businesses, Business Sectors, Public Utility Rate Payers, Local Governmental Units and the State's Economy as a Whole (Include Implementation and Compliance Costs Expected to be Incurred)
This rule will not have any significant negative economic or fiscal impact on businesses, business sectors, public utility rate payers, local governmental units, or the state's economy as a whole and does not create additional requirements that local governments must follow. Chapter 91, Stats., requires all counties to update their farmland preservation plans before January 1, 2016. Implementing the plan through farmland preservation zoning is optional for local governments. This rule provides additional clarity to the requirements under ch. 91, Stats, for completing a farmland preservation plan and a zoning ordinance for those local governments that choose to adopt one. Added clarity will make the certification process of farmland preservation plans and zoning ordinances easier for local governments to understand and complete, and faster for the department to review. This will decrease the overall number of local government and state staff hours necessary to complete the planning and zoning process. This rule will have a generally positive impact on agriculture-related businesses. This rule clarifies farmland preservation zoning standards, encouraging local governments to include agriculture-related enterprises in the zoning district. Most agriculture-related businesses may be allowed in a farmland preservation zoning district either as an agriculture-related use or an accessory use. Though such businesses may or may not collect tax credits, their presence in the district may add additional economic certainty to farmers within the certified farmland preservation district.
Benefits of Implementing the Rule and Alternative(s) to Implementing the Rule
This rule will clarify statutory requirements, which will alleviate costs at both the state and local level. With added clarity in requirements for planning and zoning certification, local government staff will require less time to complete farmland preservation plans and ordinances while staff at the state level will require less time to review these plans and ordinances. Clarity in the farmland preservation zoning standards may also encourage additional agriculture-related businesses to be included within the farmland preservation zoning district, creating added stability for these businesses fostering agricultural economic development within the district. If DATCP does not adopt this rule, counties, towns, and municipalities will continue to update their farmland preservation plans and ordinances; however, these local governments would fail to benefit from the clarity and direction that this rule could provide. This lack of clarity may result in added staff time at both the local and state level.
Long Range Implications of Implementing the Rule
Long-term, implementing the rule will benefit local governments, agriculture-related businesses, and agricultural producers. Plans and ordinances are required to be updated at a minimum of every ten years. As a result, this rule will provide needed clarity to local governments both now and into the future. Further clarification of farmland preservation zoning standards will also build certainty for agriculture-related businesses and agricultural producers that activities supporting agricultural operations will be allowed within the certified district.
Compare With Approaches Being Used by the Federal Government
There are no federal regulations or statutes related to this rule.
Compare with Approaches Being Used by Neighboring States (Illinois, Iowa, Michigan and Minnesota)
Michigan, Illinois, and Minnesota have statewide programs in which landowners may restrict the use of their land to agricultural or related uses in exchange for tax credits. These programs require local governments to engage in planning efforts prior to allowing landowners to enter into these agreements. Michigan allows farmers to voluntarily enter in a Farmland Development Rights Agreement with the state. In exchange for income tax credits and exemptions from special assessments, landowners agree not to develop the land for a specified number of years. In Illinois, any single landowner, or two or more contiguous landowners with over 350 acres of land, may form an Agricultural District. The county government is responsible for approving and implementing these areas, however the Illinois Department of Agriculture may advise those county governments interested in forming or expanding these areas. Once land is within an Agricultural District, the area remains protected for ten years. Landowners can request additions to, deletions from, or dissolution of the area. Land within the area is protected from local laws that might restrict farming practices and from special assessments. In Minnesota, counties outside of the metropolitan area can participate in the Greater Minnesota Agricultural Preserves Program. Counties that want to participate must develop an agricultural land preservation plan for review and approval by the commissioner of the Minnesota Department of Agriculture. The plan must identify land for long-term agricultural use and anticipate expected growth around urbanized areas. The designated areas must be adopted as part of the county's comprehensive plan. Landowners who are located within these areas may then place a restrictive covenant on their land agreeing to limit the land to agricultural or forestry use. The covenant is recorded on the title to the land. In exchange for agreeing to preserve land for long-term agricultural use, the landowner receives property tax credits of $1.50 per acre, per year.
Comments Received in Response to Web Posting and DATCP Response The department received comments related to the economic impact of this rule from the Wisconsin REALTORS Association and the Wisconsin Builders Association. Each comment is listed below followed by DATCP's response. After reviewing the comments, DATCP has determined that they do not alter the economic impact analysis of ATCP 49. The comments either relate to the impact of ch. 91, Stats., regardless of the presence of an administrative rule or the comments address specific language within the rule itself. As a result, DATCP has encouraged both the Wisconsin REALTORS Association and the Wisconsin Builders Association to submit their comments either orally or in writing during the rulemaking hearing period.
1. Analysis of impact on small businesses is inadequate — The small business impact analysis on pp. 5-6 is inadequate given that it focuses exclusively on agriculture-related business. The analysis does not consider the impact on non-agriculture-related businesses, such as real estate development related businesses. Accordingly, the scope of the analysis should be expanded to include all small businesses. ATCP 49 will not impact other small businesses such as real estate development related businesses. The rule does not mandate that additional land should be unavailable for development. Instead, the rule clarifies that certain businesses may be included in a certified farmland preservation zoning district. These businesses are necessarily agricultural-related or are incidental to the agricultural use of the farm. As a result, the rule does not impact real estate development related businesses any further than ch. 91, Stats.

2. Housing impact statement requirement not met — Section 227.115 of the Wisconsin Statutes requires the Department of Administration to perform a housing impact report on any administrative rule that affects, among other things, the cost of housing or cost of constructing, rehabilitating, improving or maintaining single family or multifamily dwellings. Because ATCP 91 likely has an impact on the cost of housing by limiting the supply of developable land, a housing impact statement should be prepared as part of the administrative rulemaking process. ATCP 49 does not limit the supply of developable land any further than ch. 91, Stats. The rule clarifies that the rationale in the farmland preservation plan must be based on objective criteria related to characteristics of the land. One such characteristic is whether the land is under some development pressure even if the land is not located in an area the county plans for development in the next 15 years. Applying such objective criteria would not limit the supply of developable land because the county could use this determination as a reason for excluding this land from the farmland preservation area. Moreover, the farmland preservation plan itself does not limit whether land may be used for nonagricultural development. The farmland preservation plan is meant to guide future land use decisions, but it is not by itself a land use restriction. ATCP 49 also requires that a farmland preservation zoning ordinance zones at least 80% of the land that is planned for farmland preservation. The process of farmland preservation planning and then zoning means that the local government has first looked at the land and determined what areas are likely to remain in agricultural use. The 80% zoning requirement then ensures that the local government is treating all agricultural landowners within its jurisdiction equally. If the county has undergone the planning process, then the land that is planned for farmland preservation has already been determined to not be available for development. Thus the 80% rule would not be removing any lands from the pool of lands with the potential to be developed.

3. Application of the “under some development pressure" standard — With respect to ATCP § 49.12(1)(a)(5) on page 13, lines 9-10, we are not clear on how DATCP will apply the "under some development pressure" standard. If the land is "under some development pressure," should the land be included or excluded from the farmland preservation plan? If the land is under development pressure, the land arguably should be planned for nonagricultural development within the next 15 years and, thus, should not be included in the farmland preservation plan. Moreover, whether land is under some development pressure should not be relevant to the issue of whether it is good farmland. This comment addresses the clarity of suggested rule language, not the potential economic impact that the rule will have. Consequently, it would be more appropriate to comment on this rule provision during the public hearing period. It should perhaps be noted that leaving the language as it is in the rule would enable counties to treat development pressure either way it chooses. Perhaps a county feels that the presence of some development pressure means that the land is appropriate to be included in the farmland preservation area for now, because inclusion means that the county has some tools available to try to steer development away from this sensitive area. Perhaps another county feels that the presence of even some development pressure makes the likelihood of conversion out of agricultural use too great for the land to be included in the farmland preservation area. Either way, the rule language allows the county to make this determination. The criterion fundamentally emphasizes the need to pay attention to factors at work on the land itself and not primarily the wishes of individual landowners.

4. Failure to consider city and village comprehensive plans — With respect to ATCP § 49.12(1)(a)(6) on page 13, lines 11-12, this provision requires counties to consider future nonagricultural development and incompatible uses as determined by the county and town comprehensive plans. However, this provision does not require counties to consider nonagricultural development and incompatible uses identified by village and city comprehensive plans. Because comprehensive plans of cities and villages also contain projections for future nonagricultural development and possible uses that are incompatible with agricultural uses, the comprehensive plans of cities and villages should also be considered. This comment is also more appropriate for the public hearing period because it addresses the substance of the rule itself instead of any potential economic impact that this provision of the rule will have. A request could be made to change the provision to include the comprehensive plans of cities and villages. Whether the department can or should include such language would need to be evaluated after all of the public comments have been collected.

5. Areas to be included in farmland preservation zoning district — With respect to ATCP § 49.25(2) on page 18, lines 22-23, this provision requires at least 80% of the area planned for farmland preservation to be included in the farmland preservation district or a district that imposes land use regulations that are at least as restrictive as the farmland preservation zoning district. Is this requirement found in Chapter 91 of the Wisconsin Statutes or some other statute? If not, where does it come from? This question also does not relate to the economic impact of the rule. Any comment regarding the 80% threshold should be made during the public hearing period. We have historically used 80% as a guideline and it is a threshold to which many zoning authorities are already accustomed. Chapter 91 uses the term “substantially consistent." We know that this is much greater than 50%, but not quite 100%. To give local governments additional guidance, we have chosen to codify the already-recognized 80% guideline.

Notice of Hearing

Employee Trust Funds

rulemaking_notices CR 13-004 CR 13-004

The Wisconsin Department of Employee Trust Funds (ETF) proposes an order pursuant to s. 227.14, Stats., to amend administrative rules s. ETF 10.01 (3i) and 10.65 and to create ss. ETF 10.65 (Note), 10.86, 20.0251, and 20.0251 (Note) to clarify how ETF complies with applicable provisions of the Internal Revenue Code (IRC).

A public hearing on the proposed rule will be held.

Hearing Information

Date:   Thursday, February 13, 2013

Time:   2:00 p.m.

Location:   Conference Room GB
  Offices of the Department of Employee Trust Funds
  801 West Badger Road
  Madison, WI 53713

Persons wishing to attend should come to the reception desk up the stairs (or by elevator) from the main entrance to the building.

Place Where Comments Are To Be Submitted and Deadline for Submissions

Comments may be submitted to the contact person no later than 4:30 p.m., Wednesday, February, 20, 2013. The public hearing will be held at 2:00pm on Wednesday, February 13, 2013 in conference room GB of the Wisconsin Employee Trust Fund building at 801 W. Badger Rd, Madison, WI 53713.

Free Copies of Proposed Rule

Copies of the proposed rule are available without cost from the Office of the Secretary, Department of Employee Trust Funds, P.O. Box 7931, Madison, WI 53707-7931. The telephone number is: [phone].

Analysis Prepared by the Department of Employee Trust Funds

Statutes interpreted

Sections 40.015, 40.03 (1), (1) (am), 40.31, 40.32, Stats., relating to compliance with the IRC.

Statutory authority

Sections 40.03 (1) (am), (2) (i) and (t), and 227.11 (2) (a) (intro), 1. to 3., Stats.

Explanation of agency authority

By statute, the ETF Secretary is expressly authorized, with appropriate board approval, to promulgate rules required for the efficient administration of any benefit plan established in ch. 40 of the Wisconsin statutes. Also, each state agency may promulgate rules interpreting the provisions of any statute enforced or administered by the agency if the agency considers it necessary to effectuate the purpose of the statute.

The ETF Secretary is also required by statute to ensure that the WRS maintains compliance with the Internal Revenue Code (IRC) as a qualified plan for tax purposes and each plan is administered in compliance with the code. Numerous provisions in Chapter 40 require ETF to comply with the internal revenue code.

This rule is subject to s. 227.135 (2), Stats., as affected by 2011 Wis. Act 21. The statement of scope for this rule was approved by the Governor on 10/2/12 and published in Register No. 682 on 11/01/2012.

Related statutes or rules

There are no other relevant statutes or rules that are related to WRS compliance with the IRC that are not addressed in this rule.

Plain language analysis