Reduced Taxes for Urban Gardens: New Law Breaks Ground for Urban Ag
CUESA, October 4, 2013
Straight to the Source
"Operating on a month-to-month lease means you never know what will happen tomorrow or the next day," says Caitlyn Galloway of Little City Gardens,
a ¾-acre commercial farm in San Francisco's Outer Mission district. "It
makes smart investments in our business, like longer-term tools and
infrastructure, much riskier."
Galloway's predicament of uncertain land tenure is one faced by many new
farmers, both rural and urban. But a new California law just signed by
Governor Jerry Brown might take some of the risk out of the equation for
urban farmers by making longer-term leases an appealing proposition for
The Urban Agriculture Incentive Zones Act
(AB 551) is based on a simple premise: It allows cities and counties to
designate "incentive zones" in urban areas (250,000+ people) where
landowners can get a substantial property tax break in exchange for
dedicating their vacant land to commercial or noncommercial agricultural
use for at least five years. Under this arrangement, property taxes are
based on an assessment of the agricultural value of the land, instead
of its much higher market value.
The goal is to financially reward owners of undeveloped parcels for entering into agreements with urban farmers. "For businesses like ours, the potential for having a much longer-term arrangement with a property owner could completely change the playing field," says Galloway.