A5051

An Act concerning the realty transfer fee, amending P.L.1968, c.49, and supplementing Title 4 of the Revised Statutes.

Be It Enacted by the Senate and General Assembly of the State of New Jersey:

1. Section 6 of P.L.1968, c.49 (C.46:15-10) is amended to read as follows:

6. The fee imposed by [this act] P.L.1968, c.49 (C.46:15-5 et seq.) shall not apply to a deed:

(a) For a consideration, as defined in section 1(c), of less than $100.00;

(b) By or to the United States of America, this State, or any instrumentality, agency, or subdivision thereof;

(d) Which confirms or corrects a deed previously recorded;

(e) On a sale for delinquent taxes or assessments;

(f) On partition;

(g) By a receiver, trustee in bankruptcy or liquidation, or assignee for the benefit of creditors;

(h) Eligible to be recorded as an "ancient deed" pursuant to R.S.46:16-7;

(i) Acknowledged or proved on or before July 3, 1968;

(j) Between husband and wife, or parent and child;

(k) Conveying a cemetery lot or plot;

(l) In specific performance of a final judgment;

(m) Releasing a right of reversion;

(n) Previously recorded in another county and full realty transfer fee paid or accounted for, as evidenced by written instrument, attested by the grantee and acknowledged by the county recording officer of the county of such prior recording, specifying the county, book, page, date of prior recording, and amount of realty transfer fee previously paid;

(o) By an executor or administrator of a decedent to a devisee or heir to effect distribution of the decedent's estate in accordance with the provisions of the decedent's will or the intestate laws of this State;

(p) Recorded within 90 days following the entry of a divorce decree which dissolves the marriage between the grantor and grantee;

(q) Issued by a cooperative corporation, as part of a conversion of all of the assets of the cooperative corporation into a condominium, to a shareholder upon the surrender by the shareholder of all of the shareholder's stock in the cooperative corporation and the proprietary lease entitling the shareholder to exclusive occupancy of a portion of the property owned by the corporation ; or

(r) Conveying preserved farmland as defined in section 4 of P.L.2009, c.213 (C.54:4-23.3c) to a person who possesses a written certification, issued by the Department of Agriculture pursuant to section 2 of P.L. , c. (C. ) (pending before the Legislature as this bill), demonstrating that the person qualifies as a beginning farmer .

(cf: P.L.1999, c.357, s.1)

2. (New section) a. The Department of Agriculture shall establish a process whereby a person may request to receive written certification from the department that the person qualifies as a beginning farmer. The department shall establish the manner and form, including eligibility criteria and documentation necessary, for a person to receive certification pursuant to this section. In developing the manner and form necessary, the department shall consider the certification for qualified beginning farmers used by the Pennsylvania Department of Agriculture.

The department shall publish the form to be used to request certification as a beginning farmer, together with the eligibility criteria and documentation necessary, in a prominent location on its website. The department may charge a fee, not to exceed $100, to a person requesting certification as a beginning farmer.

b. As used in this section:

“Beginning farmer” means a person who desires to engage in farming and has never farmed before, who has engaged in farming in the State for 10 years or less as of the effective date of P.L. , c. (C. ) (pending before the Legislature as this bill), or who qualifies as a first-time farmer pursuant to 26 U.S.C. s.147(c)(2).

“Farming” means the cultivation of land for the production of agricultural crops, the raising of poultry, the production of eggs, the production of milk, the production of fruit or other horticultural crops, grazing, the production of livestock, aquaculture, hydroponics, the production of forest products, or other activities designated by the Department of Agriculture pursuant to rules and regulations.

3. This act shall take effect immediately.

STATEMENT

This bill provides that preserved farmland purchased by a qualified beginning farmer would not be subject to the realty transfer fee. Under this bill, the fee would not apply when preserved farmland is acquired by a person who possesses a written certification issued by the Department of Agriculture pursuant to the bill demonstrating that the person qualifies as a qualified beginning farmer. The bill requires the Department of Agriculture to establish a procedure to certify in writing a person as a qualified beginning farmer.

The realty transfer fee (fee), established pursuant to P.L.1968, c.49 (C.46:15-5 et seq.), applies to sales and transfers of interests in real property and is imposed upon the recording of deeds evidencing transfers of title to real property in the State. Current law provides a number of full and partial exemptions from the payment of the fee.

This bill is similar to a provision contained in the Pennsylvania Farm Bill. The Pennsylvania Department of Agriculture has established a certification process for qualified beginning farmers. A person who receives this certification is exempt from the realty transfer fee when purchasing a preserved farm.

New Jersey has long committed to preserving farmland, however New Jersey cannot rest on the success of land preservation. The State needs to do much more to preserve farming itself and take further action to preserve its farmers as well. This bill is intended to remove a disincentive for people to take up the vital and historic role of farmer. Currently, the average age of a farmer in the United States is 57.5 years. The national average age has increased by 1.6 percent annually since 1994, on average, according to the 2017 Census of Agriculture conducted by the United States Department of Agriculture. The average age of a New Jersey farmer is 59.7 years, according to the same report.