The Village is set to preserve in perpetuity another 10 acres of farmland at the north end of Corrales. It is the Phelps Farm on the east side of Corrales Road where Trees of Corrales has had a tree nursery for its wholesale business in recent years. It is a little south of the intersection with Romero Road, one of the main entrances to the Bosque Preserve.
At the May 25 Village Council meeting, an option to purchase a conservation easement on the land was approved unanimously. A final appraisal has yet to be made, but the Village is expected to pay approximately $780,000 to prevent the tract from being developed. The money has been generated from sale of general obligation (GO) bonds as directed by Corrales voters in the 2018 municipal election. Those bonds were issued to raise $2.5 million to be used for farmland preservation.
The 9.78-acre tract is owned by Courtenay and Anne Koontz, also owners of Trees of Corrales. The Village has until the end of October this year to exercise the option.
Last year, the Village acquired a similar easement on the Haslam family’s farm a little south of the Phelps land between the Main Canal and the Corrales Lateral irrigation ditch west of Corrales Road.
That earlier acquisition preserved 12 acres at a cost of approximately $960,000 from those GO bonds.
If the Village choses to exercise the option to purchase the Phelps easement, that will have essentially depleted revenue generated from that 2018 bond approval.
Through the farmland preservation program, the people of Corrales have removed at least 63 acres from residential development since it began in 2004. (See Corrales Comment Vol.XXIII No.21 December 18, 2004 “Prospects Good for Another $360,000 USDA Grant to Save Farmland.”)
When voters here approved issuance of $2.5 million in GO bonds in 2004, Corrales became the first municipality in the state to establish a conservation easement program.
With those revenues secured as matching funds, the Village was successful in getting a $1.1 million grant from the U.S. Department of Agriculture (USDA). When all of the first round of GO bonds were spent, villagers were asked to approve a second issuance of $2.5 million in bonds to continue the program. Again, villagers enthusiastically said yes in 2018.
The proposed agreement for the new easement would reserve a half-acre parcel adjacent to the bosque for a future small residence and another half-acre site for a future farm-related building.
The agreement negotiated with the Koontz family describes the following benefits.
• “Public Recreation Value. The property will include a ‘public viewing area’ off of Corrales Road where the general public will be able to pull off and park and enjoy the unobstructed view of the farmland, bosque and Sandia Mountains. The area will offer four parking spaces and at least two viewing benches. The recreational value of this area is directly linked to bird watching and quiet enjoyment of the majestic views that the conserved property offers. The owner has agreed to contribute up to $10,000 for improvements made to this public viewing area. The owner would also ask the Village to help maintain the area (e.g. garbage collection, cleaning, and other maintenance) as well as include the area under the Village’s liability insurance policy for publicly accessible areas.
• “Farmland Preservation. The property consists of valuable irrigated farmland (prime and important soils) that has been in production for decades. The conservation easement will encumber the water rights to the property in perpetuity, meaning the water rights cannot be severed or separately sold from the Property and will only be used for agriculture or wildlife habitat purposes.
The owner believes they may have pre-1907 water rights, but that has yet to be determined.
• “Scenic Open Space. The property is located along, and directly adjacent to Corrales Road, the primary thoroughfare through the Village of Corrales. This portion of Corrales Road had an approximate 4,000-5,000 daily vehicle count in 2017. The property is visible by the general public from Corrales Road and from existing recreation trails within the Corrales Bosque Preserve.
• “Wildlife Habitat. Since the property is irrigated farmland, it serves as valuable habitat for migratory birds along international flyways and also provides habitat for a number of other native species.”
The agreement gives the following as “estimated property valuations,” important factors because the Village of Corrales will be prohibited from paying more than fair market value.
“A consulting appraisal was completed for the property by Hippauf, Dry & Connelly Real Estate Appraisers and Consultants in November of 2019. The consulting appraisal valued the property at $110,000 to $130,000/acre. Another appraisal was completed on the Haslam property in 2020 that placed the property value at approximately $127,000 per acre. The Haslam property is similar in size and location to the property, therefore, we can assume the “before” value of the Property will be approximately $130,000/acre or about $1,300,000 (rounded for planning purposes).
“Also, as part of the Haslam appraisal, it was noted that the diminution due to the conservation easement was approximately 60 percent with the reservation of one residential building envelope and one agricultural building envelope. This project will also have one residential building envelope and thus a diminution of approximately 60% is warranted for planning purposes.
“Therefore, the approximate value of the conservation easement is $780,000 +/-.”
In a section of the draft agreement headed “Suggested Conservation Strategy,” the following understandings are laid out.
“This strategy assumes the Koontz Family (“owners”) are paid the full value of the conservation easement by the Village of Corrales bond funds. If the Owners are interested in a partial donation to receive a state tax credit and federal income tax deductions, we can alter the strategy to reflect this approach.
“The option… shall expire on October 31, 2021.
“Purchase Price. In the event that the buyer exercises the option to purchase the easement over the conservation easement property, seller shall sell the easement to buyer by a direct conveyance to N.M. Land Conservancy of the easement over the conservation easement property for a minimum purchase (“floor price”) of $750,000.00. If valuation of the easement exceeds the floor price, buyer agrees to pay seller the floor price plus any amount that exceeds the floor price (“easement purchase price”). Buyer shall provide written “Floor Notice” to seller if buyer determines that the appraisal is less than the floor price. Seller may be excused from the obligation of selling the easement to buyer if seller is provided floor notice and seller provides buyer written notice of seller’s desire to be excused from this option to purchase the easement….”
Early in the Village’s program, the Farmland Preservation and Agricultural Commission developed a check-list for the easement program that has 14 “positive criteria,” including pre-1907 irrigation water rights, whether the parcel abuts an irrigation ditch, or is currently being farmed, as well as scenic quality, potential for wildlife habitat and whether there is strong neighborhood support.
Some confusion may still exist among villagers as to what, exactly, will be purchased. It is only the development right on those parcels that will be bought with municipal bond proceeds.
Ownership of the land continues to reside with the property owner who sells the easement. However, the property has a deed restriction saying it cannot be developed in any way other than as farmland or open space.
A USDA fact sheet described the concept as follows. “A conservation easement is an interest in land, as defined and delineated in a deed, whereby the landowner conveys specific rights, title and interests in a property to a State, Tribal or local government or non-governmental organization. The landowner retains those rights, title and interests in the property which are specifically reserved to the landowner in the easement deed, such as the right to farm.…
“A landowner submits an application to an entity… that has an existing farm or ranch land protection program. In exchange for payment, participating landowners agree not to convert their land to non-agricultural uses, and to develop and implement a conservation plan for any highly erodible land.”
The fact sheet on the USDA’s Farm and Ranch Land Protection Program further pointed out that “The value of a conservation easement usually is determined through a professional appraisal. A qualified appraiser assesses the difference between the fair market value of the property, often using comparable sales, and its restricted value under the easement.…
“The easements generally restrict non-farm development and subdivisions. Some farm-related housing may be allowed.… The easements become part of the land deed and are recorded in the local land records.”
On August 31, 2004 by a margin of nearly 5-to-1, Corrales voters approved issuance of municipal bonds to buy conservation easements on farmland here to keep it out of development. The 2004 bond election was the culmination of a 33-year commitment by villagers to keep their community rural.
At least 29 states in the United States have conservation easement programs to save farmland. Those have already secured at least 6.5 million acres for future agricultural use.
According to the American Farmland Trust, “Every day 2,000 acres of agricultural land are paved over, fragmented or converted to uses that jeopardize farming.”
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