Sponsored by:
Assemblyman ALEX SAUICKIE
District 12 (Burlington, Middlesex, Monmouth and Ocean)
SYNOPSIS
Authorizes counties and County Agriculture Development Boards to transfer farmland preservation installment purchases to State Agriculture Development Committee.
CURRENT VERSION OF TEXT
As introduced.
An Act concerning installment purchases of preserved farmland and supplementing P.L.1983, c.32 (C.4:1C-11 et seq.).
Be It Enacted by the Senate and General Assembly of the State of New Jersey:
1. In the event a county or board enters into an installment purchase agreement with a landowner for a development easement on, or the acquisition of, farmland pursuant a farmland preservation plan prepared and adopted by the county or pursuant to the provisions of the "Agriculture Retention and Development Act," P.L.1983, c.32 (C.4:1C-11 et al.), the board or county may transfer the installment purchase agreement to the committee, with the committee’s consent, prior to the end of the term of the agreement. The county or board shall collaborate with the committee regarding the issuance of funds in order to effectuate the terms of the installment purchase agreement.
2. This act shall take effect immediately.
STATEMENT
This bill would authorize a county or County Agriculture Development Board (CADB) to transfer installment purchase agreements of land acquired for farmland preservation purposes to the State Agriculture Development Committee (SADC).
Currently, State law allows counties and CADBs to enter into installment purchase agreements with a farm landowner for a development easement or land acquisition in exchange for payment over a certain period of time. Installment purchase agreements generally provide that each payment be separated into components of principal and interest. However, an installment purchase agreement may also be structured to provide a balloon payment of the principal at the end of the term of the agreement, with semiannual payments of interest on the principal outstanding. In addition, if the transaction is structured through an installment agreement with a government entity, the interest may be exempt from federal and State income taxes. Furthermore, installment agreements permit the stretching of available government farmland preservation funds.
If the SADC agrees, the bill would allow the SADC to handle the management of installment purchase agreements made on behalf of counties and CADBs for preserved farmland.