Long presumed to become a casualty of the state’s financial crisis, Williamson Act subvention was gutted last week by the governor, but county leaders say they will continue to fund current contracts and extend new ones into the future.

 

“The good news is that the program was not eliminated,” said 3rd District Supervisor Doreen Farr on Friday. “It means that the next year or the following year, when the state budget or the economy improves, the money can be put back into the program.”

Established in the 1960s, the Williamson Act grants landowners lower property tax rates, if they agree to keep their land in agriculture for at least 10 years. The program covers 16.9 million acres of farmland statewide, including 550,000 acres in Santa Barbara County or about 75 percent of all local agricultural land.

The county is among the top 10 in California with the largest one-year enrollment increases, according to a 2008 Williamson Act Status report by the California Department of Conservation.

Because funding from the state has been tenuous in the past, the county did not budget for the dollars it generally gets from the state. Consequently, landowners under such contracts will see no change in tax breaks, Farr said.

Bill Gillette, the county’s agriculture commissioner, said the county is not likely to eliminate the program because the state only compensates the county with $640,000 for local losses in property taxes — about $13 million annually.

The reimbursement amount is based on a formula created in 1971 that pays the county $1 for every acre of pasture land and $5 for every acre of cultivated land, he said.

“The fear would be that the county becomes desperate for funds over time,” Gillette said.

Williamson Act funding has been off and on the chopping block for years. Back in mid-June, before the governor whittled down the act’s budget to a token $1,000, the state Assembly’s Budget Committee had voted to suspend the subventions, but that agreement dissolved after protests from the committee’s vice chairman, Assemblyman Jim Nielsen, who brokered a 20 percent cut compromise.

It is still unknown if the Williamson Act funds will be reinstated next year, but if the cuts turn out to be permanent, some fear that they would severely curtail agriculture in the county and across the state.

Kevin Merrell, a board member of the Santa Barbara County Farm Bureau, said axing the Williamson Act would devastate agriculture because “sky high” land values would force many ranchers and farmers across the state and county to develop.

“The Legislature is good at coming up with regulations for farmers to follow,” Merrell said sarcastically. “So while our competitors across the world have been supported with tax breaks, we’re scrambling to stay in business in a worldwide market with countries that recognize that agriculture is viable,” he said. “It’s just one more thing on the backs of farmers that leaves them to ask, ‘How am I going to keep going?’ “

Bill Giorgi, a local rancher who has land under a Williamson Act contract, said eliminating the act would be a “deathblow” to grazing and pasture land.

Giorgi, who sits on the land-use committee for the Santa Barbara Cattlemen’s Association, said cattlemen and cattlewomen, who require large swaths of land for ranching, see small profit margins, and losing the tax benefits they get from the Williamson Act could put many out of business.

Such sentiments are supported by a 1990 survey that gauged the importance of the act to participating landowners. It found that one in three landowners who participate in the Williamson Act program would be unable to continue farming or ranching without the benefits of the program.

“Those figures would still be accurate today,” said John Gamper, director of taxation and land use for the California Farm Bureau Federation.” A lot of those farmers are still in business, and they’d look back and say were it not for the Williamson Act, in those lean years the cost of their property taxes would have put them out of business.”

Los Olivos rancher Willy Chamberlin called the governor’s move “short-sighted,” but he wasn’t the least concerned that the county would do away with Williamson contracts.

“I don’t believe they’re going to throw us to the wolves because if our property taxes go up too high, we’ll sell our land and make it into smaller parcels to sell it,” he said. “The county has lost some money, but if land is sold into smaller, agricultural parcels, there would be more people and more services the county would have to budget for.

“On top of that, there will be less open space, something people in this county do not want to see happen. There’d be a snowballing effect for the worst.”

Santa Barbara County is a mixture of rural and urban land, but unlike some other counties that have been gobbled up during the housing boom, the region, especially the North County, is firmly entrenched in agriculture, a $1 billion industry employing about 1,700 people each year.

Gillette said that even if the county eliminated the program or suspended it to shore up recessionary budget cuts, it would not get an immediate increase in tax revenue.

State law says that if counties do not renew a Williamson Act contract and the landowner protests, the county cannot raise property taxes for at least four years, he said.

Perhaps the primary reason county leaders do not intend on doing away with Williamson Act subventions is because the county’s reimbursement from the state amounts to only one-half percent of all property taxes, a miniscule loss compared to amounts incurred by smaller rural counties, Gamper said.

“Santa Barbara County takes in about $112 million in property taxes because of expensive development,” Gamper said. “So $600,000 isn’t a hard blow. But Glenn County was cut off at the knees when they lost almost a million out of a total property tax take of $5 million. That’s a 20 percent loss.”

Reach Jeremy Foster at jfoster@syvjournal.com.