What's happening
This bill creates a property tax credit for owners of working farmland in agricultural districts who agree to restrict their land to agricultural uses.
Why it matters
Strengthens Farmland Preservation. By incentivizing landowners to restrict their property to agricultural use for at least eight years, the bill aims to slow the conversion of farmland to non-agricultural development—helping to maintain open space, protect local food production, and preserve rural character in New York.
Economic Relief for Farmers. The property tax credit directly addresses one of the biggest financial pressures on farmers—high property taxes—potentially improving the economic viability of farming operations and helping keep farms in business, especially in areas facing development pressure.
Robust Oversight and Local Planning. The bill requires counties to adopt and update comprehensive agricultural and farmland protection plans, with ongoing oversight, eligibility reviews, and reporting mechanisms. This ensures the program is coordinated with local land-use policies and remains responsive to changing conditions.
Strong Penalties for Early Conversion. To prevent abuse of the credit, the legislation imposes a significant recapture penalty (double the credited amount) if land is converted to non-agricultural use within eight years, except in cases of involuntary conversion. This creates a strong disincentive for speculative participation and reinforces long-term farmland conservation.
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Who cares
Owners of agricultural assessment land
Eligible owners could claim a state tax credit for school, town and county property taxes on the land’s agricultural assessment value in exchange for an eight-year agricultural-use covenant, but qualifying conversions would trigger repayment of twice the prior credits.
County governments and farmland protection boards
Participating counties would need farmland protection plans, parcel maps and recorded covenants, with boards advising on designation and review.
Department of Agriculture and Markets
The commissioner would set eligibility and application rules, review county applications and determine whether counties remain eligible.
Department of Taxation and Finance
The department would receive county eligibility notices and land-status reports relevant to administering the new credits and recapturing credits when land is converted to disqualifying uses.
Headline styles
Give Tax Credit to Farmers
Plain English, a few words. Used as the page title.
Sponsors
History
- Referred to investigations and government operations
Full text
8 pagesUnderlined is new[Struck] is removedOfficial text on nysenate.gov ↗
STATE OF NEW YORK
961
2019-2020 Regular Sessions
IN SENATE
January 9, 2019
Introduced by Sens. YOUNG, FUNKE, ORTT, RANZENHOFER, SEWARD -- read twice and ordered printed, and when printed to be committed to the Committee on Investigations and Government Operations
AN ACT to amend the tax law, the general municipal law, the real property tax law and the agriculture and markets law, in relation to the establishment of a working farmland property tax credit for owners of agricultural assessment land within agricultural districts
The People of the State of New York, represented in Senate and Assembly, do enact as follows:
Section 1. Legislative intent. The legislature hereby finds, determines and declares that the New York agriculture industry has a substantial impact on the overall economic health and well-being of the state. The state constitution provides that the policy of the state shall be to encourage the development and improvement of its agricultural lands for the production of food and other agricultural products. The activities of farmers and the protection of viable farmland provide many environmental benefits to society, such as open space, scenic vistas, wetlands that aid in water purification, plants that purify air, and food, water and habitat for people, domestic animals and wildlife. Therefore, it is in the public interest to encourage the maintenance of existing farmland and agricultural lands for farming purposes, thereby helping to ensure the continued economic viability of farm operations.
§ 2. Section 210-B of the tax law is amended by adding a new subdivision 11-a to read as follows:
11-a. Working farmland property tax credit. (a) General. In the case of a taxpayer that owns agricultural assessment land which is eligible for the working farmland property tax credit established pursuant to article eighteen-D of the general municipal law and an agricultural district established pursuant to article twenty-five-AA of the agriculture and markets law, and the taxpayer has executed a covenant to restrict the use of such land pursuant to section nine hundred seventy-
EXPLANATION--Matter in italics (underscored) is new; matter in brackets
[ ] is old law to be omitted.
LBD03011-01-9
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two-g of the general municipal law, there shall be allowed a credit for the school district, town and county property taxes paid during the taxable year on such land; provided, however, that the amount of the credit shall be limited to the taxes paid on the agricultural assessment value of such land as calculated by the assessor pursuant to section three hundred five or three hundred six of the agriculture and markets law. In the event that agricultural assessment land is removed from an agricultural district pursuant to article twenty-five-AA of the agriculture and markets law, a taxpayer that owns such land shall continue to be eligible for the credit provided by this subdivision for the remainder of the term of the eight year covenant.
(b) School district property taxes. For purposes of this subdivision, the term "school district property taxes" means all property taxes, special ad valorem levies and special assessments, exclusive of penalties and interest, levied for school district purposes on the agricultural assessment land owned by the taxpayer.
(c) Town and county property taxes. For purposes of this subdivision, the term "town and county property taxes" means all property taxes, special ad valorem levies and special assessments, exclusive of penalties and interest, levied for town and county purposes on the agricultural assessment land owned by the taxpayer.
(d) Agricultural assessment land. The term "agricultural assessment land" means land which receives or is eligible to receive an agricultural assessment for the taxable year pursuant to section three hundred five or three hundred six of the agriculture and markets law. Agricultural assessment land also includes land set aside or retired under a federal supply management or soil conservation program.
(e) Nonqualified use of agricultural assessment land. (1) No credit in conversion year. In the event that agricultural assessment land, or any portion of such land, is converted to nonqualified use, credit under this subdivision shall not be allowed with respect to such property for the taxable year of conversion (the conversion year).
(2) Credit recapture. If the conversion of agricultural assessment land, or any portion of such land, to nonqualified use occurs during the period of the eight taxable years following the taxable year for which the credit under this subdivision was last claimed with respect to such property, the credits allowed with respect to such property for the taxable years prior to the conversion year, multiplied by two hundred percent, must be added back in the conversion year.
(3) Exception to recapture. Subparagraph two of this paragraph shall not apply to the conversion of land where the conversion is by reason of involuntary conversion, within the meaning of section one thousand thirty-three of the internal revenue code.
(4) Conversion to nonqualified use. For purposes of this paragraph, conversion to nonqualified use shall mean that such land is converted to a use which would disqualify such land for an agricultural assessment under section three hundred five or three hundred six of the agriculture and markets law.
(f) In no event shall the credit provided in this subdivision be allowed in an amount which will reduce the tax payable to less than the higher of the amounts prescribed in paragraphs (b) and (c) of subdivision one of this section. If, however, the amount of credit allowable under this subdivision for any taxable year reduces the tax to such amount, any amount of credit not deductible in such taxable year may be carried over to the following year or years and may be deducted from the taxpayer's tax for such year or years. Provided, however, in lieu of
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carrying over the unused portion of such credit, the taxpayer may elect to treat such unused portion as an overpayment of tax to be credited or refunded in accordance with the provisions of section one thousand eighty-six of this chapter except that no interest shall be paid on such overpayment.
(g) A taxpayer shall reduce credits claimed under this subdivision by any credits claimed under subdivision eleven of this section for the taxable year.
§ 3. Section 606 of the tax law is amended by adding a new subsection (n-3) to read as follows:
(n-3) Working farmland property tax credit. (1) General. In the case of a taxpayer that owns agricultural assessment land which is located in an agricultural district established pursuant to article twenty-five-AA of the agriculture and markets law, and the taxpayer has executed a covenant to restrict the use of such land pursuant to section nine hundred seventy-two-g of the general municipal law, there shall be allowed a credit for the school district, town and county property taxes paid during the taxable year on such land; provided, however, that the amount of the credit shall be limited to the taxes paid on the agricultural assessment value of such land as calculated by the assessor pursuant to section three hundred five or three hundred six of the agriculture and markets law. Such credit shall be allowed against the taxes imposed by this article for the taxable year reduced by the credits permitted by this article. If the credit exceeds the tax as so reduced, the taxpayer may receive, and the comptroller, subject to a certificate of the commissioner, shall pay as an overpayment, without interest, the amount of such excess. In the event that agricultural assessment land is removed from an agricultural district, a taxpayer that owns such land shall continue to be eligible for the credit provided by this subdivision for the remainder of the term of the eight year covenant.
(2) School district property taxes. For purposes of this subsection, the term "school district property taxes" means all property taxes, special ad valorem levies and special assessments, exclusive of penalties and interest, levied for school district purposes on the agricultural assessment land owned by the taxpayer.
(3) Town and county property taxes. For purposes of this subsection, the term "town and county property taxes" means all property taxes, special ad valorem levies and special assessments, exclusive of penalties and interest, levied for town and county purposes on the agricultural assessment land owned by the taxpayer.
(4) Agricultural assessment land. The term "agricultural assessment land" means land which receives or is eligible to receive an agricultural assessment for the taxable year pursuant to section three hundred five or three hundred six of the agriculture and markets law. Agricultural assessment land also includes land set aside or retired under a federal supply management or soil conservation program.
(5) Nonqualified use of agricultural assessment land. (A) No credit in conversion year. In the event that agricultural assessment land, or any portion of such land, is converted to nonqualified use, credit under this subsection shall not be allowed with respect to such land for the taxable year of conversion (the conversion year).
(B) Credit recapture. If the conversion of agricultural assessment land, or any portion of such land, to nonqualified use occurs during the period of the eight taxable years following the taxable year for which the credit under this subsection was last claimed with respect to such land, the credits allowed with respect to such land for the taxable
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years prior to the conversion year, multiplied by two hundred percent, must be added back in the conversion year.
(C) Exception to recapture. Subparagraph (B) of this paragraph shall not apply to the conversion of land where the conversion is by reason of involuntary conversion, within the meaning of section one thousand thirty-three of the internal revenue code.
(D) Conversion to nonqualified use. For purposes of this paragraph, conversion to nonqualified use shall mean that such land is converted to a use which would disqualify such property for an agricultural assessment under section three hundred five or three hundred six of the agriculture and markets law.
(6) A taxpayer shall reduce credits claimed under this subsection by any credits claimed under subsection (n) of this section for the taxable year.
§ 4. The general municipal law is amended by adding a new article 18-D to read as follows:
ARTICLE 18-D
WORKING FARMLAND PROPERTY TAX CREDIT Section 972. Short title.
972-a. Statement of legislative findings and declaration.
972-b. Definitions.
972-c. Eligibility criteria for working farmland property tax
credit.
972-d. Eligibility criteria for approval of county agricultural
and farmland protection plans.
972-e. Powers and duties of the commissioner.
972-f. Application for eligibility for designation as eligible
for the working farmland property tax credit.
972-g. Review of working farmland designation.
972-h. Restriction of lands to agricultural uses.
972-i. Annual report.
§ 972. Short title. This article shall be known and may be cited as the "working farmland property tax credit act".
§ 972-a. Statement of legislative findings and declaration. It is hereby found and declared that the conservation and protection of agricultural lands, and the promotion of agriculture as a vital local resource is of statewide concern. It is the public policy of the state to conserve, protect and encourage the development and improvement of its agricultural land for production of food and other agricultural products. It is also the declared policy of the state to conserve and protect agricultural lands as valued natural and ecological resources which provide needed open spaces for clean air sheds, as well as for aesthetic purposes. In order to accomplish these goals in the context of local planning and land use decision-making, it is declared to be in the interest of the state to establish authority at the township level to designate the town as eligible for the working farmland property tax credit to provide incentives and otherwise assist landowners and towns to mutually achieve these goals.
§ 972-b. Definitions. As used in this article, the following words and terms shall have the following meanings unless the context shall indicate another or different meaning or intent:
(a) "Applicant" shall mean the county submitting an application in the manner authorized by this article for designation of an area as eligible for the working farmland property tax credit.
(b) "Commissioner" shall mean the commissioner of agriculture and markets.
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(c) "Working farmland property tax credit" shall mean a county within the state that has been designated as eligible for a working farmland property tax credit pursuant to this article.
(d) "County agricultural and farmland protection plan" shall mean a plan that has been adopted by a county legislative body pursuant to section three hundred twenty-four of the agriculture and markets law.
(e) "Agricultural and farmland protection board" shall mean a county agricultural and farmland protection board established pursuant to section three hundred two of the agriculture and markets law.
(f) "Agricultural assessment land" shall mean land which receives or is eligible to receive an agricultural assessment for the taxable year pursuant to section three hundred five or three hundred six of the agriculture and markets law. Agricultural assessment land also includes land set aside or retired under a federal supply management or soil conservation program.
Reflowed for reading: line numbers and page breaks removed. Cite the official text.
Sponsor's memo
Title of bill
An act to amend the tax law, the general municipal law, the real proper- ty tax law and the agriculture and markets law, in relation to the establishment of a working farmland property tax credit for owners of agricultural assessment land within agricultural districts
Purpose or general idea of bill
To establish a working farmland property tax credit for owners of agri- cultural assessment land within agricultural districts.
Summary of specific provisions
The Tax Law, General Municipal Law, Real Property Tax Law and the Agri- culture and Markets Law would be amended to establish and structure program parameters for the Working Farmland Tax Credit. In exchange for a commitment to keep land in active agricultural use for eight years, an eligible landowner would be eligible for a state income tax credit equal to the total amount paid in school and local municipal property taxes less any credits claimed under the Farmers' School Tax Credit program.
Justification
The Working Farmland Tax Credit would complement New York's agricultural districts program by building a partnership between New York State, local governments and agricultural land owners to promote economic viability of our farm operations. The intent of this program is to encourage rural economic growth by encouraging active management of New York's agricultural land base and provide local governments with an optional tool to help support farms and complement their local land use policies. To date, four counties have recommended this concept in their Agriculture and Farmland Protection Plans.
Prior legislative history
2017,2018:S.459A Referred to Investigations & Government Operations
2015,2016:S.2992 Referred to Investigations & Government Operations
2013,2014:S.2249A Referred to Investigations & Government Operations
2011,2012:S.789 Referred to Investigations & Government Operations
2009,2010:S.2416A/A.7205A Reported to Finance
2007,2008:S.5685A Passed Senate
Fiscal implications
Undetermined at this time.
Effective date
This act shall take effect on the one hundred eightieth day after it shall have become a law and shall apply to taxable years beginning on or after the effective date of this act. Provided that any rule or regu- lation necessary for the timely implementation of the provisions of this act on its effective date may be promulgated on or before such effective date.
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