Incentive zones in urban agriculture

What is AB 551?

AB 551, also called the urban agriculture incentive zones act began in 2013. This act allows cities and counties to provide landowners a property deduction if they commit their land to urban agriculture use for at least five years. This bill aims to increase the use of privately owned, vacant land for urban agriculture and improved land security for urban agriculture projects. The legislation does this by allowing city governments, with approval from their county board of supervisors, to designate areas within their boundaries as “urban agriculture incentive zones.”

How it works?

This act works by landowners signing a contract to commit the land that they own to agricultural use for at least five years. In return, they will receive a tax deduction. Specifically, their parcel’s property tax assessment will be based on the agricultural value of the land rather than the market-rate value of the land.

Important restrictions/guidelines

– it is important to know that urban agriculture incentive zones can only be established in areas that:

  • Fall within a US Census designated urban area of 250,000 people or more.  This includes the major cities and most of the inner suburbs in the West, South and East Bay.
  • Have not been covered by Williamson Act contracts within the preceding three years

– in addition, to be eligible, individual parcels must be:

  • At least 0.1 acre in size and no larger than 3 acres
  • Completely dedicated toward commercial or noncommercial agricultural use
  • Free of any dwellings and only have physical structures that support the agricultural use of the site

– Each year the assessment basis of land under contract will be based on the average per acre value of irrigated cropland in California as reported by the US Department of Agriculture’s National Agricultural Statistics Service.  In 2012, this was $12,000 per acre.

– If a landowner breaks the five-year contract, they are obligated to pay back the tax benefit that they received.

It is very important to take each of these into consideration for both the landowner and the people in charge of the farms. This act benefits not only the people in the cities, but it also benefits the landowner. They not only get a tax deduction, but they also probably feel good knowing the land that they own is feeding people that may not have had this readily available.

Extension of the act
 The extension bill, which is named AB 465 has already passed the Assembly Local Government and Agriculture committees with unanimous support. The next step is that it now moves to more committees in the legislature. If they are successful to this point, it will reach the governor’s desk in the fall. With the low cost of establishing urban agriculture incentive zones and the continued interest from advocates and cities, extending the program through 2029 makes sense and SPUR is hopeful that it will pass.

Hopefully, with the extension of this act, more landowners and towns will be more aware of what they can accomplish by growing an urban farm.

2 thoughts on “Incentive zones in urban agriculture”

  1. This blog is amazing, it helps brings awareness about incentives of using Ab 551 act using privately owned land for urban agriculture. Urban cities are filled with unused land space, these sites are usually privately owned. Most of these sites are used a dumping grounds by the public. You brought up several great points about the AB 551 act how will help benefits landowners. Landowners will receive tax detections if they agree to a five-year contract to use their land for urban agricultural projects. Communities will benefit from having better access to healthier food options and help improve food security. This article can help inform landowners about an opportunity to receive tax breaks for their land and help their community. If I were a landowner and I saw this article it will help convince me to give up my land to help my community. Great job on this article, it helps make it easy to understand how incentives work in AB 551 act for urban agriculture.

  2. Hey, this article on the Ab551 law was really insightful. It goes to show that there was the right group of people pushing for change in having more land owners of empty lots to get them to be repurposed. The repurpose of these lots is not beneficially one sided, both the grower and the land owner win in this deal, and in fact more win beyond the two parties. In this video we have urban farmer Ken Dunn who has looked further into urban farming. Ken takes waste from the city and reuses it as compost for his plants and to replace the contaminated soil.
    https://www.youtube.com/watch?v=XaEKJ5Vv3Zg

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