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By:  Geren, Escobar                                               H.B. No. 116

Substitute the following for H.B. No. 116:                                    

By:  Miller                                                   C.S.H.B. No. 116


A BILL TO BE ENTITLED
AN ACT
relating to the establishment of the farm and ranch lands conservation program. BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF TEXAS: SECTION 1. Chapter 183, Natural Resources Code, is amended by designating Sections 183.001-183.005 as Subchapter A, Chapter 183, Natural Resources Code, and by adding a heading for that subchapter to read as follows:
SUBCHAPTER A. CONSERVATION EASEMENTS GENERALLY
SECTION 2. Chapter 183, Natural Resources Code, is amended by adding Subchapter B to read as follows: SUBCHAPTER B. TEXAS FARM AND RANCH LANDS CONSERVATION PROGRAM Sec. 183.051. PURPOSE. The purpose of this subchapter is to enable and facilitate the purchase and donation of agricultural conservation easements. Sec. 183.052. DEFINITIONS. In this subchapter: (1) "Agricultural conservation easement" means a conservation easement as that term is defined in Section 183.001, except that an easement established under this subchapter for the specific purpose of conserving qualified land must accomplish one or more of the following additional purposes: (A) conserve water quality or quantity; (B) conserve native wildlife species through protection of their habitat; (C) conserve rare or sensitive plant species; or (D) conserve large tracts of qualified open-space land that are threatened with fragmentation or development. (2) "Commissioner" means the commissioner of the General Land Office. (3) "Council" means the seven member Texas Farm and Ranch Lands Conservation Advisory Council, appointed by the governor, whose purpose is to provide recommendations to the commissioner on the administration of the program. (4) "Fund" means the Texas farm and ranch lands conservation fund, an account of the land office dedicated to funding the purchase of agricultural conservation easements through grants to qualified easement holders under this subchapter. (5) "Land office" means the General Land Office. (6) "Program" means the Texas farm and ranch lands conservation program of the land office, the purpose of which is to conserve qualified lands through the purchase of agricultural conservation easements. (7) "Purchase of agricultural conservation easement" means the purchase from a willing seller of an agricultural conservation easement on qualified land either in perpetuity or for a term of 30 years. (8) "Qualified easement holder" means a "holder" as defined by Section 183.001, except that for purposes of this subchapter, only a state agency, a municipality or a Section 501(c)(3) organization that is organized for the purpose of preserving agriculture, open space, or natural resources may receive grants from the fund. (9) "Qualified land" means qualified open-space land as that term is defined by Section 23.51, Tax Code. Sec. 183.053. TERMS OF AGRICULTURAL CONSERVATION EASEMENT. The owner of qualified land and a potential purchaser of an agricultural conservation easement should consider and negotiate easement terms, including the following considerations: (1) whether the landowner will receive a lump sum or annual or monthly payments; (2) whether the term of the easement shall be perpetual or for a term of 30 years; (3) whether a term easement is renewable; (4) whether the landowner retains limited development rights for personal or family residences on the land; and (5) the market value of the easement. Sec. 183.054. TERMINATION OF EASEMENT. (a) An easement under this subchapter may not be assigned to or enforced by a third party without the express written consent of the landowner. (b) Any time after an agricultural conservation easement is acquired with a grant awarded under this subchapter, the landowner may request the commissioner to terminate the easement as provided by this subchapter on the ground that the landowner is unable to meet the conservation goals as described in this subchapter. The termination request must contain a verifiable statement of impossibility. (c) Upon receipt of the request for termination, the commissioner shall notify the easement holder and conduct an inquiry. Within 180 days after receipt of the request the commissioner shall notify the parties of the decision to grant or deny the request for termination. Either party shall have 45 days from the date of the notification to appeal the decision in district court. Sec. 183.055. REPURCHASE BY LANDOWNER. (a) If a request for termination is granted, the commissioner shall order an appraisal of the fair market value and the agricultural value of the property subject to the easement. The landowner shall bear the cost of the appraisal. (b) For purposes of this section: (1) "Fair market value" means the price as of the appraisal date that a buyer willing, but not obligated, to buy would pay for the land at its best and most beneficial use under any obtainable development zoning category. (2) "Agricultural value" means the price as of the appraisal date a buyer willing, but not obligated, to buy would pay for a farm or ranch unit with land comparable in quality and composition to the subject property, but located in the nearest location where profitable farming or ranching is feasible. (c) Within 180 days of the appraisal, the landowner must pay to the fund an amount equal to the difference between the current fair market value and the agricultural value. (d) Within 30 days of payment as described by Subsection (c) of this section the easement holder shall terminate the easement. (e) If the request for termination is denied, or the owner fails to repurchase the easement within 180 days of the appraisal, the owner may not subsequently request termination until the expiration of five years from the date of the last request. Sec. 183.056. PROTECTED LAND; NOTICE OF TAKING. (a) A department or agency of this state, a county, a municipality, or other political subdivision may not approve any program or project that requires the use or taking through eminent domain of private land encumbered by an agricultural conservation easement purchased under this subchapter unless the governmental entity acting through its governing body or officers determines that: (1) there is no feasible and prudent alternative to the use or taking of the land; and (2) the program or project includes all reasonable planning to minimize harm to the land resulting from the use or taking. (b) A finding required by Subsection (a) may be made only at a properly noticed public hearing. (c) The governing body or officer shall consider clearly enunciated local preferences, and the provisions of this subchapter do not constitute a mandatory prohibition against the use of the area if the findings are made that justify the approval of a program or project. (d) Any department or agency of this state, a county, a municipality, or other political subdivision exercising the power of eminent domain in accordance with the provisions of this subchapter on land encumbered by an agricultural conservation easement purchased under this subchapter shall: (1) pay to the fund an amount equal to the original amount granted from the fund for the purchase of the easement; and (2) pay to the landowner the sum of the fair market value and the agricultural value less an amount equal to the original grant from the fund for the purchase of the easement. Sec. 183.057. TEXAS FARM AND RANCH LANDS CONSERVATION FUND. (a) The Texas agricultural lands conservation fund is established as an account of the land office dedicated to funding the purchase of agricultural conservation easements through grants to qualified easement holders under this subchapter. The fund may not be used for grants to purchase or acquire any right or interest in property by eminent domain. The fund consists of: (1) money appropriated by the legislature to the fund; (2) public or private grants, gifts, donations or contributions; or (3) funds from any other source, including proceeds from the sale of bonds, state or federal mitigation funds, or funds from any local, state, or federal program. (b) The Texas farm and ranch lands conservation program is established as a program of the land office for the purpose of administering the assistance to be provided by the fund. (c) The fund may be used only: (1) to award grants for the purchase of agricultural conservation easements, the value of which shall be determined by a site–specific estimate–of–value appraisal performed by a licensed, qualified appraiser; (2) to pay transaction costs related to the purchase of agricultural conservation easements, which may include reimbursement of appraisal costs; and (3) to pay not more than five percent of the money in the fund for associated administrative costs of the land office. Sec. 183.058. ADMINISTRATION OF THE FUND. (a) The fund shall be managed and administered by the commissioner to achieve the goals of the program. The commissioner may: (1) in consultation with the council adopt rules necessary to perform program duties under this subchapter; (2) request, accept, and use gifts, loans, donations, aid, appropriations, guaranties, subsidies, grants, or contributions of any item of value for the furtherance of any purposes of this subchapter; (3) establish, charge, and collect fees, charges, and penalties in connection with the programs, services, and activities provided for by this subchapter; (4) make, enter into, and enforce contracts and agreements, and take other actions as may accomplish any of the purposes of this subchapter; (5) seek ways to coordinate and leverage public and private sources of funding; (6) adopt best practices and enforcement standards for the evaluation of easements purchased through grants from the fund; (7) establish a protocol for the purchase of agricultural conservation easements and for the distribution of funds to approved applicants; (8) evaluate selection and eligibility based on criteria established by this subchapter and administer grants awarded to successful applicants; (9) ensure that agricultural conservation easements purchased under this subchapter are not inconsistent with the preservation of open space and the conservation of wildlife habitat or water; and (10) award grants and approve the termination of easements and take any other action necessary to further the goals of the program. (b) To receive a grant from the fund under this subchapter, an applicant who is qualified to be an easement holder under this subchapter must submit an application to the commissioner. The application must: (1) set out the parties' clear conservation goals consistent with the program; (2) include a site–specific estimate–of–value appraisal by a licensed appraiser qualified to determine the market value of the easement; (3) demonstrate that the applicant is able to match 50 percent of the amount of the grant being sought, considering that the council may choose to allow a donation of part of the appraised value of the easement to be considered as in-kind matching funds; and (4) include a memorandum of understanding from the landowner and signed by the applicant indicating intent to sell a conservation easement and the terms of the contract. Sec. 183.059. CRITERIA FOR AWARDING GRANTS. The commissioner shall adopt a scoring process that considers the following: (1) maintenance of landscape and watershed integrity to conserve water and natural resources; (2) protection of highly productive agricultural lands; (3) protection of habitats for native plant and animal species, including habitats for endangered, threatened, rare, or sensitive species; (4) susceptibility of the subject property to subdivision, fragmentation, or other development; (5) potential for leveraging state money allocated to the program with additional public or private money; (6) proximity of the subject property to other protected lands; (7) term of the proposed easement, whether perpetual or for a specified term of years; and (8) resource management plan agreed to by both parties and approved by the commissioner. Sec. 183.060. TEXAS FARM AND RANCH LANDS CONSERVATION ADVISORY COUNCIL. (a) The Texas Farm and Ranch Lands Conservation Advisory Council is established to advise and assist the commissioner with administration of the program established within the land office and consists of: (1) one member who operates a family farm or ranch in this state; (2) one member who is the designated representative of an agricultural banking or lending organization and who has significant experience lending for farms and ranches and lands encumbered by conservation easements; (3) one member who is a licensed real estate appraiser in good standing and who has significant experience appraising farms and ranches and lands encumbered by conservation easements; (4) two members who are the designated representatives of statewide agricultural organizations in existence in this state for at least ten years; (5) one member who has significant experience with water policy and management issues; (6) one member from a state institution of higher education who has significant experience with wildlife management issues; and (7) One ex-officio member is the state conservationist of the U.S.D.A. Natural Resource Conservation Service or a designee of that person. (b) Members of the council serve staggered terms of six years, with two or three of the members' terms expiring February 1 of each odd-numbered year. (c) Appointments to and removal from the council shall be made by the governor without regard to the race, color, disability, sex, religion, age, or national origin of the appointees. (d) The commissioner shall designate two members of the council as the chair and the vice chair of the council to serve in those capacities at the will of the commissioner. The council may choose from its members other officers as the council considers necessary. (e) A member of the council is not entitled to compensation for service on the council but is entitled to reimbursement of the necessary and reasonable travel expenses incurred by the member while conducting the business of the council, as provided for state employees by the General Appropriations Act. (f) The council shall meet not less than twice each year. (g) In this section, "Texas trade association" means a cooperative and voluntarily joined statewide association of business or professional competitors in this state designed to assist its members and its industry or profession in dealing with mutual business or professional problems and in promoting their common interest. A person may not be appointed as a council member or general counsel to the council if the person or the person's spouse: (1) is employed by or participates in the management of a business entity or other organization receiving money from the council; (2) owns or controls, directly or indirectly, more than a 10 percent interest in a business entity or other organization receiving money from the council; (3) uses or receives a substantial amount of tangible goods, services, or money from the council other than compensation or reimbursement authorized by law for council membership, attendance, or expenses; (4) the person is an officer, employee, or paid consultant of a Texas trade association for an occupation or profession with an interest in land conservation that is related to the occupation or profession; (5) the person's spouse is an officer, manager, or paid consultant of a Texas trade association for an occupation or profession with an interest in land conservation that is related to that occupation or profession; or (6) the person is required to register as a lobbyist under Chapter 305, Government Code, because of the person's activities for compensation on behalf of an occupation or profession with an interest in land conservation that is related to that occupation or profession. (h) It is a ground for removal from the council if a member: (1) is ineligible for membership under this section; (2) cannot, because of illness or disability, discharge the member's duties for a substantial part of the member's term; or (3) is absent from more than half of the regularly scheduled council meetings that the member is eligible to attend during a calendar year without an excuse approved by a majority vote of the council. (i) The validity of an action of the council is not affected by the fact that it is taken when a ground for removal of a participating council member exists. (j) If the presiding officer has knowledge that a potential ground for removal exists, the presiding officer shall notify the commissioner and the governor that a potential ground for removal exists. (k) The presiding officer or the presiding officer's designee, with the assistance of staff of the land office, shall provide to members of the council information regarding a member's responsibilities under applicable laws relating to standards of conduct for state officers. (l) A person who is appointed to and qualifies for office as a member of the council may not vote, deliberate, or be counted as a member in attendance at a meeting of the council until the person completes a training program that complies with this section. The training program must provide the person with information regarding: (1) the legislation that created the council; (2) the program to be administered under this subchapter; (3) the role and functions of the council; (4) the rules of the council, with an emphasis on the rules that relate to disciplinary and investigatory authority; (5) the current budget for the council; (6) the results of the most recent formal audit of the council; (7) the requirements of: (A) the open meetings law, Chapter 551, Government Code; (B) the public information law, Chapter 552, Government Code; (C) the administrative procedure law, Chapter 2001, Government Code; and (D) other laws relating to public officials, including conflict-of-interest laws; and (8) any applicable policies adopted by the council or the Texas Ethics Commission. (m) A person appointed to the council is entitled to reimbursement, as provided by the General Appropriations Act, for the travel expenses incurred in attending the training program regardless of whether the attendance at the program occurs before or after the person qualifies for office. SECTION 3. This Act takes effect September 1, 2005.