In many jurisdictions, the farmers are considered the guys with the bucks. Clearly, many farmers have done well over the last ten years. Hopefully, some of this money has been kept “at home” and has not been moved out of the local community.
In Rhode Island, land use is a real problem. Here we have property ready for development. At the same time, there is value in something more than just farming for these properties.
The Warwick Beacon article does not fully comprehend what is “fair” or “unfair” to farmers. Realistically, the state determines that it wants to protect farmers, you can easily do this by proper statutory enactments. This is why some states provide a premium to personally owned residential properties subjected to condemnation.
Each of us has to figure out what is fair, and that is spoken through the state legislative body. What happens on farms in our future and for our future, must be determined through state legislative action. This is not an easy decision to make, but one that needs to be made each and every time there is an opportunity to develop land for non-agricultural use.
For a home or business owner, compensation equal to 150 percent of a property’s real estate value, based on a sliding six-to-12 comparative market value scale, is more than a fair payback. With such a payment, one can easily purchase another house or set up shop in another office or storefront. For the farmer, who is subject to the same eminent domain taking and compensation policies, a 150 percent compensation level does not break even in the long-term.
The eminent domain compensation amount granted for farmland is based solely on physical acreage and incidental fees. It does not account for the productivity, arability, and cash crop value of each acre, leaving farmers with a definite quandary. Farmers lose not only their land, but also the accrued annual income for each year the land is no longer in their ownership.
Consider a typical Rhode Island farm in the USDA’s view: In 2012, the average Rhode Island farm contained approximately 56 acres. Nationally, the average price of hay, one of Rhode Island’s most important crops, sold for approximately $226 per ton, with 1.88 tons produced per acre per year. Using the 2012 national average farm acre price of $2,650, a Rhode Island farmer whose land was seized under eminent domain powers would be entitled to an upfront payment of $222,600. Though it is a fair compensation for the physical land lost, this amount does not come close to compensating the profit lost at a yearly rate. The same farmer would lose $23,793.28 in income per year, for a grand total loss of nearly a half million dollars over a 20-year period.
As advanced as Rhode Island’s eminent domain laws are, they lack differential policy. To be truly fair to all types of landowners, the Rhode Island General Assembly must recognize the inherent differences between agricultural and other entities, as the former must receive fair consideration for lost profit in a way that other, more easily transplanted businesses do not. Farmers have long been the backbone of the United States of America. Rhode Island would do well to act as an example for the rest of the nation and take steps toward full protection of farmers’ rights and revenue.