Board of Commissioners
Purchase Development Rights (PDR)
Program Requirements for Landowners
Property must lie within a participating unit of government.
Eighteen out of Kent County’s twenty-one townships are participating. Byron, Grand Rapids and Plainfield Townships are not participating.
Lands Eligible for Purchase of Development Rights
A parcel of any size is eligible for consideration for development rights purchase, provided that at least 51% of the nominated property is currently devoted to an agricultural use. Agricultural use means substantially undeveloped land devoted to the production of plants and animals useful to humans, including forages and sod crops; grains, feed crops, and field crops; dairy and dairy products; poultry and poultry products; livestock, including breeding and grazing of cattle, swine, captive cerdivae, and similar animals; berries; herbs; flowers; seeds; grasses; nursery stock; fruits; vegetables; Christmas trees; and other similar uses and activities. The management and harvesting of a wood lot is not an agricultural use under this act, however, woodlots may be included in the application but cannot count as agricultural land. A farm enrolled in a federal acreage set aside program or federal Conservation Reserve Program (CRP) is considered an agricultural use.
Township Board Approval of PDR Application
Landowners do not have to seek approval, This will be done by Agricultural Preservation Board staff.
Property must not be slated for commercial or industrial use in township’s comprehensive / master plan.
This will be verified by Township officials and by Ag Board staff.
Property must not lie within the 2020 Urban Services District.
To determine if you are within the water and sewer Urban Services District, contact Jay Hoekstra with Grand Valley Metro Council at 776-7605.
Current zoning must allow agricultural use.
This will be verified by township officials by Ag Board staff.
Property and landowner must be in compliance with local, state and federal environmental regulations.
All owners of all rights associated with the property must be willing to sign a subordination agreement
and abide by the agricultural conservation easement that would be placed on the land if the development rights were purchased. (For example, owners of mineral rights, banks who hold mortgages, etc. must subordinate.) Surface mining or other practices that would negatively impact the agricultural productivity of the land would not be allowed under the conservation easement.
Requirements if USDA funding is used to purchase development rights:
- An appraisal of the property must be ordered by Kent County to determine the development rights value. Funding for appraisals is limited. Only high scoring PDR applications can receive appraisals. The Kent County Agricultural Preservation Board makes a recommendation to the Board of Commissioners on which properties should be appraised.
- 25% - 50% local matching funding must be secured before state and federal grant applications can be started. Local matching funding can include: landowner donation, local unit of government, private donations, foundation grants or a combination of those sources.
- The USDA will not allow future splitting of the property in the PDR Program. Landowners wishing to split the property in the future should have a separate PDR application for each future parcel. Note that each excluded parcel above the current home site plus one building home site for a future farmer, will remove 10 points from the application.
- If development rights are purchased, landowners must work with the USDA NRCS officer to develop a Resource Management System Level conservation plan and must sign the conservation easement restricting the use of the property in the PDR Program at closing.
Additional Information Landowners Should Know
- Purchase of development rights is a voluntary program. It was initiated through the passage of the PDR ordinance by the Board of Commissioners in November 2002. The first application cycle in Kent County was held from December 1, 2003 – January 31, 2004. 44 applications were accepted from 11 townships for over 5,300 acres in 2003.
- If accepted in to the program, landowners are paid the value of their
development rights, which equals the difference between the value of the land
for the highest and best use (development, usually) and the value of the land
if sold after the conservation easement is in place.
A Simple Example:
$5,000 per acre = value of land sold for development - $2,000 per acre = value of land sold for farming $3,000 per acre = payment for development rights
- As of September 2008, the lowest price paid for development rights was $2,400 per acre and the highest was $4,550 per acre. Once the development rights have been purchased, a permanent agricultural conservation easement is placed on the land.
- If you enter into the PDR Program, you still own the land and all other rights attached to the land. For example, you may still sell the land as farmland or can pass on to heirs.
- Landowners should consult their family members and all heirs as well as accountant and attorney before applying to the PDR Program
- Applying to the PDR Program does not obligate landowners to participate. Landowners decide if they are interested in participating the program when they are presented an offer (dollar figure) for the purchase of their development rights.
- Once the application cycle ends, all applications will be scored according to the current scoring criteria approved by the Board of Commissioners. For more information on the scoring criteria, see the link listed on the menu to the left.
- PDR applicants will be mailed a letter with your rank / priority in July of each year and will be asked to verify the information.
- If your property ranks high and funding to cover an appraisal has been secured by the county, the value of your development rights will be determined by a state certified appraiser hired by the county. Donations, local government contributions and grant funds will be used to cover appraisal costs.
- If you do not agree with the appraisal, you have the opportunity to pay for your own appraisal. The Kent County Agricultural Preservation Board will then determine if matching funding exists to work with the new appraised amount. A new offer would then need to be approved by the Board of Commissioners.
- Landowners donating a portion of the value of their development rights will receive points through the Scoring Criteria for doing so. You may want to consult your accountant and/or attorney to see if a contribution would benefit you estate for tax purposes. Contributions may be tax deductible.
- If you enter the PDR Program, your property tax assessor(s) must consider the removal of the development rights in their assessment. We recommend showing the appraisal to your local assessor before you make a decision on whether or not to accept the option agreement. Typically, the more development that was possible on the land, the greater the savings on property taxes once the development rights are sold.
- If you decide to enter the PDR Program, there will be restrictions on the property in the program. For example, you will not be allowed to construct buildings not related to the agricultural operation and you will not be able to have a farm market on property in the program. Review the draft conservation easement language for a more complete understanding of the restrictions.
- PDR can be a useful estate planning tool, however, payments for development rights are subject to Capital Gaines taxes. The federal program allows payment of one lump sum or installment payments over a period up to 5 years. Again, we encourage you to consult your attorney and estate planner before applying to the program.
- Simplified Application Steps:
- Landowner submits application. The application process takes place from March 1 - April 30 of each year.
- Townships, USDA NRCS and GVMC are sent applications for scoring by the Ag Board staff.
- Landowner is mailed score and rank.
- Appraisals are ordered on high scoring applications with funding.
- Option agreements are offered to some landowners. Landowners accept or reject offer.
- Federal program application is prepared and sent to the County Board of Commissioners for approval.
- USDA NRCS scores all statewide applications using their criteria.
- Selected landowners are awarded grant funds.
- Closing documents for purchase are prepared and completed.
- Closing takes place. Property is entered in the PDR Program and easement monitoring begins.
- If your application is not selected, with your permission, the Kent County Agricultural Preservation Board may keep it on file for the following year.
If you would like to set up an appointment to discuss the PDR Program and review the application process, please contact Kendra Wills, with Kent / MSU Extension and staff person to the Kent County Agricultural Preservation Board at (616) 336-2028.