Fayette County

Lexington eyes changes in farmland preservation program

Aerial view of Castleton Lyons Farm, 2469 Ironworks Pike, August 12, 2016.
Aerial view of Castleton Lyons Farm, 2469 Ironworks Pike, August 12, 2016.

Lexington is considering tighter rules for those who oversee and participate in its farmland preservation program, which has spent $79 million to preserve nearly 30,000 acres of Fayette County farmland since it was created in 2000.

One change would make members of the Rural Land Management Board, which oversees the Purchase of Development Rights program, wait one year after leaving the board before applying to participate in the program. Another would prohibit landowners who receive city money for conservation easements from getting a second appraisal to counter the government’s appraisal, which drives up the price the city pays for conservation easements.

The changes were presented Tuesday during a meeting of the Lexington council’s Planning and Public Safety Committee. They were recommended by a special subcommittee of the Rural Land Management Board, which was formed to consider changes in the ordinance that governs the program after several controversies regarding its oversight.

The full Rural Land Management board is expected to vote on those changes at its March 28 meeting, said Derek Paulsen, the city’s planning commissioner. If the full board approves the changes, they will come back to the Lexington-Fayette Urban County Council for final approval.

The changes were prompted in part by a series of Herald-Leader stories. One story found that six current or former members of the Rural Land Management Board had received payments from the program after leaving the board. In contrast, members of a board that oversees affordable housing must wait six years after leaving the board before applying for city affordable housing money.

“There is a perceived conflict of interest,” said Councilman Kevin Stinnett.

Not included in the proposed changes is a limit on the upper income of participants or a requirement that participating landowners be American citizens. The federal government’s conservation program, which typically pays half the price of easements purchased by Lexington, prohibits landowners who make more than $900,000 a year from receiving federal money and doesn’t allow foreign nationals to participate.

That issue came up when Shane Ryan, an Irish native, wanted the city to spend $5 million to buy conservation easements to protect Castleton Lyons, a more than 1,000-acre farm. Ryan did not qualify for federal matching funds because he is not a U.S. citizen. The council ultimately voted in 2017 not to use only city money to purchase development rights for Castleton.

Ryan had also proposed the city pay him for the easement over a period of time instead of in one lump sum. One of the proposed changes would prohibit paying for easements over time.

Councilwoman Susan Lamb said she is concerned that eliminating that option is “not in the best interest of the farmers” and could handicap the city during lean times.

The city uses the proceeds of bond sales to pay for the PDR program, Paulsen said. There are legal concerns about paying that money out over time if the city doesn’t get the easement until payments are completed, he said. Paulsen said he is not aware of any farm conservation easements that have been purchased in that way.

The subcommittee also recommended that landowners who don’t quality for federal matching funds be asked todonate up to 50 percent of the land value. That change would not be in the city ordinance; it would be an internal policy change.

“The city would then be buying the same amount without the federal match,” said Paulsen. The top reason land doesn’t qualify for a federal match is because its soil quality is ranked too low, he said.

Of the $79 million spent buying conservation easements in Fayette County, $38 million was local money, $15 million was state money and $26 million was federal money.

Beth Musgrave: 859-231-3205, @HLCityhall