News & Events
Williamson Act Terminated
Governor Arnold Schwarzenegger used his line-item veto power to terminate the California Land Conservation Act, more commonly known as the Williamson Act. Since 1965, California landowners have voluntarily enrolled approximately 16 million acres under the Williamson Act to restrict land use to agriculture or related open space. In return for restricting the use of their land, California landowners were taxed on the agricultural value of the land rather than its fair market value and the State reimbursed each county for the amount of uncollected taxes. According to the California Department of Conservation, one in three farmers surveyed stated that they would not be able to keep their properties without Williamson Act tax savings. Termination of the Williamson Act is another aspect of the State borrowing from the counties (though it is doubtful, will ever be repaid). However, even before the current budget crisis, there were indications that the State wanted to eliminate the Williams Act, which means that these subvention payments will not come back, at least in the near future.
The Department of Conservation reported that suspension of the Williamson Act subvention payments to local government is an unfortunate, but expected result of the State’s fiscal constraints. While subvention payments have been customary for many years, they have never been guaranteed. The Williamson Act contracts between landowners and local governments are important to the State’s agricultural production and remain in force, regardless of the availability of subvention payments. Landowners and local governments can non-renew Williamson Act contracts, but the Department does not anticipate a mass exodus from the program. Once the economy rebounds, the Department is hopeful that subvention payments will be available again and the Williamson Act program will continue to have a significant, positive impact on California agriculture and land-use planning.
At a minimum, some counties will be much more willing to work for (early) termination -- not just non-renewal -- of Williamson contracts, particularly in situations where the landowner is eager to start paying higher property taxes to the county (that is, wants to develop the property beyond what is allowed under the contract). New Williamson Act contracts seem much less likely.
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