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  • Wisconsin Lawyer
    December 17, 2009

    Wisconsin’s Working Lands: Securing Our Future

    The Working Lands Initiative is a cooperative state and local government and private effort to save farmland, protect the environment, and minimize land-use conflicts. A new law provides enhanced tax credits for farmers whose land is protected for agricultural use and who adopt sound environmental practices. The law provides new opportunities for public-private partnerships, and encourages a renewed community focus on farmland preservation and land-use planning.

    Wisconsin LawyerWisconsin Lawyer
    Vol. 82, No. 12, December 2009

    CowOur lives depend on the land we inhabit. We need agricultural land for food, quality of life, a healthy environment, and a healthy economy (including Wisconsin’s emerging bio-economy). Without a secure food supply, our life expectancy would be measured in weeks. Wisconsin farms and agricultural businesses generate more than $59 billion in economic activity and provide jobs for more than 350,000 people (about 10 percent of the jobs in the state).1

    But Wisconsin’s population is growing steadily, and some of the state’s best farmland is being permanently lost at an alarming rate. Dane County, the state’s highest-producing agricultural county, added 60,000 people in the last decade alone. Land-use conflicts are growing, and they will get much worse if not addressed. A sustainable future will require sound planning, wise land-use decisions, renewed agricultural investment, and careful environmental stewardship.

    A New Law Sets the Stage

    The Wisconsin Working Lands Initiative is a cooperative state and local government and private effort to save Wisconsin farmland, protect the environment, and minimize land-use conflicts. Major legislation enacted as part of the state biennial budget act created the necessary framework for this effort.2 However, community action will determine what actually happens “on the ground.” Farmers and other interested parties have much at stake and may seek guidance from lawyers who work on local government, farm, agribusiness, real estate, tax, and environmental matters.

    Overview of the New Law

    The new law provides more tools and incentives for county and local governments to preserve agricultural land and promote agricultural enterprise. It provides enhanced tax credits for farmers whose land is protected for agricultural use and who adopt sound environmental practices. It also provides new opportunities for public-private partnerships and encourages a renewed community focus on farmland preservation and land-use planning.

    The new law completely overhauls Wisconsin’s 30-year-old farmland preservation law. The farmland preservation program covers nearly eight million acres of land in Wisconsin and provides income tax credits to eligible farmers who are covered by farmland preservation zoning or individual farmland preservation agreements. The new law enhances and simplifies those tax credits and reduces eligibility barriers that have discouraged participation. County and local governments must modernize outdated farmland preservation plans and zoning ordinances in order for farmers to continue claiming tax credits.

    The new law modernizes farmland preservation zoning standards and provides more flexibility for local zoning authorities. The new standards encourage compact development rather than wasteful sprawl. The new law also creates innovative farmland preservation options, including locally designed agricultural enterprise areas and agricultural conservation easements.

    Promoting Better Planning

    Most county farmland preservation plans were written 20 to 30 years ago. The new law requires counties to update their plans and offers planning assistance.3 In counties that fail to update their plans, farmers will lose tax credits (which could total up to $27 million per year statewide). Tax credits are available only in counties that have state-certified plans.4

    The Department of Agriculture, Trade and Consumer Protection (DATCP) may certify county plans for up to 10 years.5 The new law streamlines the certification process.6 Plans certified under the old law7 remain temporarily certified under the new law,8 but most counties must renew their certifications by deadline dates ranging from 2011 to 2015 (counties with high population growth face the earliest deadlines).9

    A certified plan must meet state standards and must be consistent with the county’s comprehensive plan, if any. The new law makes it easier to integrate farmland preservation plans with comprehensive plans and eliminates inconsistent procedures.10

    A plan must identify clearly mapped areas that the county intends to preserve for agricultural and related uses.11 Farmers in those mapped areas are eligible for tax credits if their land is covered by a certified farmland preservation zoning ordinance or an individual farmland preservation agreement.

    Effect on Local Zoning

    The new law does not create any new state, county, or local zoning authority. It provides incentives for farmland preservation zoning but does not require or limit local zoning. County and local governments make their own zoning decisions and exercise their normal county and local zoning authority.12

    The new law offers tax credits to farmers who are covered by an ordinance that meets or exceeds state standards.13 The DATCP certifies county and local ordinances for that purpose.14 Certification does not affect the legal validity of an ordinance – it merely determines whether farmers are eligible for tax credits. The DATCP may certify an ordinance for up to 10 years. The new law simplifies the certification process.15

    Towns and municipalities, as well as counties, may adopt farmland preservation zoning ordinances.16 All certified ordinances, including town and municipal ordinances, must be substantially consistent with the county’s certified farmland preservation plan.17 A zoning ordinance does not necessarily have to cover all the farmland targeted for preservation in the certified county plan, but land not targeted for preservation in the certified county plan may not be included in a certified farmland preservation zoning district. Farms in excluded areas do not qualify for tax credits.18

    Ordinances certified under the old law remain temporarily certified under the new law, but most certifications must be renewed by deadline dates ranging from 2012 to 2016 (the earliest dates apply in counties with high population growth).19 If a certification expires and is not renewed, farmers covered by the ordinance will lose their tax-credit eligibility.20

    The new law spells out minimum standards for certified ordinances.21 A certified ordinance must clearly identify farmland preservation zoning districts (in which farmers are eligible for tax credits) and must describe and limit the types of land uses allowed in those districts.22 The statute limits the types of land uses that are allowable in certified districts.23 A certified ordinance may be more restrictive, but not less restrictive, than the statute.24

    Certified farmland preservation zoning districts must be devoted to agricultural and related uses. An ordinance may not allow industrial, commercial, or urban residential uses that are incompatible with farmland preservation. However, there is some flexibility to allow compatible nonfarm uses (supportive infrastructure, farm supply and processing facilities, farm-family businesses, limited rural residences, natural areas, and so on), if that is the local preference.25 A certified ordinance may add specifics, as necessary.

    In addition to identifying the types of land uses allowed in farmland preservation districts, a certified ordinance must indicate whether those uses are allowed as permitted uses (without a special permit) or as conditional uses (by permit only).26 Some uses (such as nonfarm residences) may only be allowed as conditional uses and then only if they meet minimum statutory standards (an ordinance may adopt stricter standards).27

    The new law makes it easier to design broad, coherent farmland preservation districts. A certified farmland preservation district may include woods, wetlands, and natural areas as well as pastures and croplands and may include nonfarm parcels as well as farms. However, nonfarm uses must meet farmland preservation standards, and only farm owners may claim tax credits.28 A farmland preservation district also might include some legally pre-existing land uses that do not meet the new farmland preservation standards.29 Those prior nonconforming uses may continue but may not be materially expanded or altered in violation of ordinance standards (applied according to current laws related to prior nonconforming uses).30

    A certified ordinance may be amended, but certain amendments must be affirmatively certified by the DATCP. The DATCP may also decertify an ordinance if any amendment causes it to violate certification standards.31 A zoning authority may rezone individual parcels out of a certified farmland preservation district, without any DATCP certification, but only if 1) it finds after public hearing that the rezoning meets specific statutory standards, and 2) the person requesting the rezoning pays a statutory conversion fee based on the amount of acreage rezoned.32 The conversion fee does not apply to land removed from a certified farmland preservation district as part of a general zoning map amendment that the DATCP certifies.

    Residential Development in Farmland Preservation Zoning Districts

    The new law eliminates minimum-lot-size requirements (which often increase the loss of farmland)33 and instead creates new residential density caps in farmland preservation districts.34 It requires conditional use permits for nonfarm residences and encourages compact clustering of residences to reduce agricultural impact.35 It restricts the conversion of cropland and prime farmland for residential use and prohibits nonfarm residences that impair agricultural use.36 It also tightens rezoning standards, to discourage excessive – and often unplanned – spot rezoning of parcels for residential use.  

    Effect on Farmland Preservation Agreements

    Under the old law, a farmer could claim tax credits if the farmer’s land was covered by a farmland preservation zoning ordinance or by a voluntary farmland preservation agreement with the DATCP. Voluntary agreements provided only spotty farmland protection, because the farms covered by those agreements were often widely separated from each other.

    The new law eliminates farmland preservation agreements, except in targeted agricultural enterprise areas. Existing agreements remain in effect but may not be renewed when they expire.37 Farmers in agricultural enterprise areas may enter into new 15-year agreements and may claim enhanced tax credits under the new law.38

    Agricultural Enterprise Areas

    Under the new law, the DATCP may designate agricultural enterprise areas in response to local petitions. An agricultural enterprise area does not, by itself, control or limit land use (it is not a zoning ordinance), but farmers in the designated area may enter into voluntary farmland preservation agreements and receive tax credits.39 An agricultural enterprise area must be a contiguous land area that is primarily in agricultural use. It must be targeted for agricultural preservation and development, consistent with the county’s certified farmland preservation plan.40

    A petition to create an agricultural enterprise area must be signed by at least five farmers and by all the counties, towns, and municipalities in which the area is located (other persons also may sign in support).41 The DATCP may designate areas totaling up to 200,000 acres in the first two years of the program and eventually up to one million acres.42

    Agricultural Conservation Easements

    The new law creates a state program (PACE) to purchase permanent agricultural conservation easements from willing landowners.43 Easements must be in farmland preservation areas designated under certified county farmland preservation plans. An easement does not mandate a specific land use but instead prohibits development that would make the land unavailable or unsuitable for agricultural use. The landowner retains ownership and control. The recorded easement runs with the land and is binding on subsequent owners.

    The DATCP must work with cooperating local governments or nonprofit conservation organizations to purchase easements. The DATCP may pay up to half the fair-market value of the easement (typically calculated as the difference between the agricultural use value and the development value of the land),44 plus reasonable transaction costs. The cooperating entity arranges the remaining financing, which may come from other public or private sources (the farmer also may donate part of the easement value, to get favorable federal tax treatment).

    Effect on Farmer Tax Credits and Conservation Requirements

    The new law repeals the old farmland preservation45 and farmland tax relief credits46 and uses the savings to finance a new and enhanced farmland preservation tax credit (income tax credit) beginning with the 2010 tax year (tax returns filed in 2011).47 This will provide more incentive for farmland preservation, without adding state costs.48

    A farm owner domiciled in Wisconsin may claim the tax credit, for a farm that produced gross farm revenue of at least $6,000 in the preceding year (or $18,000 over the last three years), if that farm is covered by a certified farmland preservation zoning ordinance or an individual farmland preservation agreement at the end of the tax year for which the credit is claimed.49 The tax credit is paid as a flat amount per acre,50 depending on whether the farm is covered by an agreement ($5 per acre), a zoning ordinance ($7.50 per acre), or both ($10 per acre).51 There are no minimum or maximum acreage requirements.

    A claimant must be a farm owner who is legally responsible for paying property taxes on the farm. The farm must be primarily devoted to agricultural use, but the farm owner may claim the tax credit on the entire farm acreage (including wetlands) – not just acres currently in production.52 There is no longer an income ceiling, and the amount of the tax credit no longer depends on the claimant’s income or the size of the claimant’s property tax payments.

    Farmers claiming tax credits must comply with state soil and water conservation standards (including nutrient management and manure runoff standards), regardless of whether they receive any other cost-share payment for conservation compliance.53 Claimants must certify to the Department of Revenue, on their tax-credit claim forms, that they are in compliance.54 New claimants also must attach a compliance certification from the county.55 Counties must monitor all claimants for continued compliance and may suspend tax-credit eligibility for farmers who fail to comply.56


    The new working-lands law provides incentives and a modern legal framework for making wise land-use decisions, but it does not dictate a final outcome. The shape of the future will be determined at the local level by the people of the state, including farmers and other landowners, county and local governments, investors, community organizations, and their legal advisors.

    James K. Matson, U.W. 1974, is chief legal counsel for the Wisconsin Department of Agriculture, Trade and Consumer Protection, Madison.


    1Steven C. Deller & David Williams, “The Contribution of Agriculture to the Wisconsin Economy,” U.W. College of Agricultural & Life Sciences, UW-Extension, July 31, 2009 <http:/>.

    22009 Wisconsin Act 28. Act 28 repealed and recreated Wisconsin’s farmland preservation law under Wis. Stat. chapter 91 and related tax credits under subchapter IX of Wis. Stat. chapter 71. It also created a new program, under Wis. Stat. section 93.73, for the purchase of agricultural conservation easements.

    3Act 28 initially provides about $416,000 per year for planning grants to counties. A grant may cover up to half of a county’s planning cost. Counties facing early deadlines under the new law will receive priority consideration for planning grants. See Wis. Stat. §§ 20.115(7)(dm), (tm), 91.10(6).

    4Act 28 appropriates $27 million for tax credits in 2010 (for tax returns filed in 2011). See Wis. Stat. § 20.835(2)(do). Farmers are eligible for tax credits if they are covered by a certified farmland preservation zoning ordinance or individual farmland preservation agreement that is based on a certified county farmland preservation plan. See Wis. Stat. §§ 71.613, 91.38(f), (g), .60(2)(b).

    5Wis. Stat. § 91.16. The DATCP also must certify plan amendments. See Wis. Stat. § 91.16(8), (2)(b).

    6Wis. Stat. §§ 91.16, .20. The DATCP may certify a county plan based on a county self-certification but may do its own review as it deems necessary. The DATCP must grant or deny a complete certification application within 90 days.

    7The Land and Water Conservation Board certified plans under the old law, based on analysis by the DATCP. See Wis. Stat. §§ 91.06, .61 (2007-08).

    8Wis. Stat. § 91.12(1).

    9Wis. Stat. § 91.14. The law provides for later expiration dates or extensions in some cases.

    10Wis. Stat. §§ 91.10(2), (3), .18. A plan must include relevant information related to agricultural land uses, infrastructure, resources, and trends; population and development trends that may affect farmland preservation; key land-use issues affecting farmland; and strategies to promote agricultural development and farmland preservation (including strategies to increase housing density in nonagricultural areas). The farmland preservation plan must be included in the comprehensive plan and may incorporate information from the comprehensive plan (both may be done by reference).

    11Wis. Stat. § 91.10(1)(d). Farmland preservation areas may include wetlands and other natural areas but may not include any area planned for nonagricultural development within 15 years.

    12Wis. Stat. § 91.30.

    13Under Wis. Stat. section 71.613, an eligible claimant may claim tax credits on qualifying acres in a farmland preservation zoning district created by a state-certified farmland preservation ordinance. Ordinances are certified for compliance with state standards.

    14Wis. Stat. § 91.36. The Land and Water Conservation Board certified ordinances under the old law, based on DATCP analysis. See Wis. Stat. §§ 91.06, .78 (2007-08).

    15Wis. Stat. §§ 91.36(2), .40. The DATCP may certify an ordinance based on a local self-certification (the applicant’s attorney or chief elected official must certify that the ordinance meets minimum statutory standards, and the county planning director or chief elected official must certify that it is consistent with the county’s certified farmland preservation plan), and the DATCP may do its own review as it deems necessary. The DATCP must grant or deny a complete certification application within 90 days.

    16Wis. Stat. § 91.30.

    17Wis. Stat. §§ 91.38(1)(f), .01(17).

    18Wis. Stat. § 91.38(1)(g).

    19Wis. Stat. §§ 91.32(1), .34. If an ordinance certification under the old law specified a later expiration date, that later date will still apply under the new law. See Wis. Stat. §
    91.34(1) (intro.). The DATCP secretary may also grant limited extensions in some cases. See Wis. Stat. § 91.34(4).

    20Farmers may claim tax credits if they are covered by a certified ordinance at the end of the tax year to which their claims apply (see Wis. Stat. § 71.613), even if the certification was in effect for only part of the year. If an ordinance certification expires before the end of a tax year, farmers lose tax-credit eligibility for that year. If a certification expires on Dec. 31 of any tax year (as it ordinarily does under the new law), farmers lose tax-credit eligibility beginning in the next tax year.

    21Wis. Stat. § 91.38.

    22Wis. Stat. § 91.38(1)(c)-(e).

    23Wis. Stat. § 91.42.

    24Wis. Stat. section 91.38(3) emphasizes that statutory standards are minimum standards.

    25Wis. Stat. §§ 91.42, .44, .46.

    26Wis. Stat. §§ 91.44, .46. An ordinance could adopt a two-tier approach for some land uses, based on size or other relevant factors. For example, it could treat most livestock operations as permitted uses but require a conditional-use permit for operations containing more than 500 animal units (consistent with the state livestock-facility-siting law, Wis. Stat. section 93.90). 

    27Wis. Stat. §§ 91.44, .46.

    28Wis. Stat. §§ 91.44, .46, 71.613.

    29Wis. Stat. § 91.42(3).

    30Id. (citing Wis. Stat. §§ 59.69(10), 60.61(5), 62.23(7)(h)).

    31Wis. Stat. § 91.36(8). Certification of an ordinance amendment normally expires on the same date as the ordinance certification. See Wis. Stat. § 91.36(2)(b).

    32Wis. Stat. § 91.48. The conversion fee first applies on Jan. 1, 2010, and is equal to three times the highest per-acre use value of cropland in that city, village, or town (as specified by the Department of Revenue under Wis. Stat. section 73.03(2a)). The conversion fee applies regardless of whether the landowner has ever claimed farmland preservation tax credits. The county or local government must annually report rezonings to the DATCP and submit conversion fees for deposit to a state working lands trust fund. A county or local government may charge a supplementary conversion fee to fund its own farmland preservation activities.

    33The old law originally required a 35-acre minimum lot size. 1977 Wis. Stat. § 91.75(1). A 1999 law change eliminated the 35-acre requirement but still required certified ordinances to specify a minimum lot size. 1999 Wis. Act 9, §1903. Many ordinances still have a 35-acre minimum, but there is no minimum lot size required under the new law.

    34Wis. Stat. § 91.46(2)(a), (b). Density standards limit the number of residences and the ratio of residential acreage to farm acreage (an ordinance may adopt stricter standards).

    35Wis. Stat. §§ 91.44, .46(2), (3). A conditional use permit may authorize a single nonfarm residence or a small contiguous cluster of residences that meet density and location standards. An ordinance may adopt stricter standards and may also require conditional use permits for new farm residences (if that is the local preference).

    36Wis. Stat. § 91.46(2)(c)1.-.2.

    37Wis. Stat. § 91.60. Existing agreements may be amended to allow tax credits under the new law for the duration of those agreements. See Wis. Stat. § 91.60(3)(c).

    38Wis. Stat. §§ 91.62, .84(3), 71.613.

    39Wis. Stat. § 91.84. The DATCP must designate agricultural enterprise areas by rule (a special rulemaking process applies). See Wis. Stat. § 91.84(1)(a), (2), (4), (5). Tax credits are higher if local farmland preservation zoning also applies (compare Wis. Stat. section 71.613(2)(a) and (c)).

    40Wis. Stat. § 91.84(1)(a)1., (e).

    41Wis. Stat. § 91.86.

    42Wis. Stat. § 91.84(1)(b), (c).

    43Wis. Stat. § 93.73. Wis. Stat. section 20.866(2)(wg) authorizes the state to issue up to $12 million in general obligation bonds to fund the purchase of PACE easements. This authorization is financed by an equivalent reduction in unused (and unneeded) bonding authority under section
    20.866(2)(wf) for the conservation reserve enhancement program, so there is no net increase in state debt authorization.

    44The fair-market value of the easement is determined by a professional appraisal approved by the DATCP.

    45The old farmland preservation tax credit (income tax credit) under Wis. Stat. sections 71.57 to 71.61 was based on a complex formula that considered farm income, property tax payments, and other variables. Many farmers were disqualified by outdated income limits, and the tax benefit was declining. Annual tax-credit claims dropped from $35 million in 1987 to just over $12.7 million last year, so the credit no longer provided a strong incentive for farmland preservation or conservation compliance.

    46The old farmland tax-relief credit (income tax credit) under Wis. Stat. sections 71.07(3m), 71.28(2m), and 71.47(2m) was originally designed to provide property tax relief to farmers. However, it was later overshadowed by the use value assessment program under Wis. Stat. section 70.32(2r). The tax credit did little to encourage farmland preservation or conservation but cost the state an average of $15 million per year.

    47Wis. Stat. § 71.613.

    48For an average-sized farm, the new farmland preservation tax credit may be two to three times higher than the old credit (DATCP estimate). The credit is conditioned on farmland preservation and conservation compliance. See Wis. Stat. § 71.613). The $27 million annual cost of the new tax credit (see Wis. Stat. § 20.835(2)(do)) is approximately equal to the combined costs of the repealed tax credits. The new law does not change the current use-value assessment program in any way.

    49Gross farm revenue means gross receipts from agricultural use of a farm (may include forestry use), less the cost basis of livestock or other items (purchased for resale) that are sold during the tax year. It may include agricultural sales receipts accruing to the farm owner or renter (Department of Revenue informal opinion) but may not include rent receipts. See Wis. Stat. § 71.613(1)(g). Only a farm owner who is legally responsible for paying property taxes on the farm property may claim the tax credit. See definition of qualifying acres in Wis. Stat. section 71.613(1)(h).

    50Wis. Stat. § 71.613(2). If the tax credit exceeds the farmer’s income tax liability, the farmer will receive the difference as a tax refund. See Wis. Stat. § 71.613(2)(intro.).

    51If necessary, the Department of Revenue may delay payments and adjust tax credit amounts between years to keep total annual costs within annual appropriation limits. See Wis. Stat. § 71.613(3)(f), (g).

    52See qualifying acres definition in Wis. Stat. section 71.613(1)(h) and farm definition in Wis. Stat. sections 71.613(1)(d) and 91.01(13).

    53Wis. Stat. § 91.80. DATCP rules, under Wisconsin Administrative Code chapter ATCP 50, spell out all the applicable conservation standards (chapter ATCP 50 incorporates and implements applicable DNR nonpoint pollution standards). Counties are no longer required to adopt their own standards.

    54Wis. Stat. § 71.613(3)(d)5.

    55Wis. Stat. § 71.613(3)(a)3. This initial certification requirement does not apply to farmers who claimed tax credits in the preceding year (under the old or new law).

    56Wis. Stat. § 91.82(1), (2). Compliance monitoring may include self-reporting, but a county must inspect every claimant at least once every four years.  

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