                               STATE OF VERMONT

SUPERIOR COURT                                  ENVIRONMENTAL DIVISION

                                                       }
In re Village Associates Act 250 Land Use Permit       } Docket No. 6-1-08 Vtec
       (Appeal of Village Associates, LLC)             }
                                                       }

                                 Decision and Order
      Appellant-Applicant Village Associates, LLC1 (Applicant) appealed from a

decision of the District 4 Environmental Commission, granting Applicant’s Act 250

permit for an affordable housing development but requiring an off-site mitigation

fee under 10 V.S.A. §§ 6086(a)(9)(B)(iv) and 6093.      Applicant is represented by

Heather R. Hammond, Esq.; and the Agency of Agriculture, Food and Markets is

represented by Assistant Attorney General Diane E. Zamos, Esq. The Land Use

Panel of the Natural Resources Board has informational status through John H.

Hasen, Esq., but did not participate in the merits of this appeal or in the briefing on

remand. The Agency of Natural Resources also has informational status, but did not

enter an appearance or otherwise participate.

      The only issue was whether or not the project involved primary agricultural

soils, and therefore whether the mitigation fee would be required to be paid; no

party contested the grant of the permit. An evidentiary hearing was held in this

matter before Merideth Wright, Environmental Judge. A site visit was taken by

Judge Wright alone, by agreement of the parties, including, at the request of the

parties, driving to or past a number of area agricultural operations mentioned in

evidence. This Court issued a Decision and Order on April 30, 2009, ruling that the



1As of the time of trial, the project property was being transferred to Housing
Vermont, Inc., which will own and operate the project.

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project property contains 10.85 acres of primary agricultural soils as defined by 10

V.S.A. § 6001(15), and therefore requiring Applicant to pay an off-site mitigation fee

in an amount previously agreed upon by the parties.

      On appeal, the Vermont Supreme Court reversed that decision, holding that

this Court erred in not considering the cost of clearing trees to prepare the property

for agricultural use in determining whether the presence of trees on the property is a

limitation to agricultural use that cannot be easily overcome. The Supreme Court

remanded for this Court to consider that cost in determining whether the 10.85 acres

of soils at issue in the appeal constitute primary agricultural soils requiring the

payment of an off-site mitigation fee. In re Village Associates Act 250 Land Use

Permit, 2010 VT 42A.

      The Supreme Court analyzed the 2006 amendment to 10 V.S.A. § 6001(15) and

concluded that although

      [t]he amended statute contemplates instances where the presence of
      trees and the cost of removing them will create a limitation for
      cultivation2 that is simply impossible to overcome[,] there is nothing in
      the statute mandating this outcome whenever forested land is
      involved. Indeed, there may also be instances where it is entirely
      feasible and economically practicable to remove trees to ready land for
      agricultural use—the fact that trees themselves have economic value
      suggests that this may often be the case. For instance, testimony from
      Agency officials indicated that there may be ways to overcome the cost
      of tree removal, including removing the trees over an extended period
      of time or allowing the farmer to remove the trees himself. These


2    See also the analysis of the consideration of economics in the “Farmland
Classification Systems for Vermont Soils” published by the U.S. Department of
Agriculture’s Natural Resources Conservation Service (USDA-NRCS), in evidence in
the present case as State’s Exhibit B, and the analogous language used in Act 250
regarding primary agricultural soils, discussed in In re Brosseau/Wedgewood Act
250 PRD Application, No. 260-11-08 Vtec, slip op. at 6–11, n. 15 (Vt. Super. Ct. Envtl.
Div. Dec. 8, 2010) (Wright, J.).


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        questions will be for the Environmental Court to consider on remand.
Village Associates, 2010 VT 42A, ¶ 22. The Supreme Court went on to explain that

the test does not involve a comparison with the cost to ready the land for

development, but “[i]nstead, consideration of the cost of removing a limitation will

involve only a consideration of whether the cost of removal is so high that

conversion of the land into agricultural use is not economically feasible.” Id., at

¶ 23.

        Following the remand, the parties were given the opportunity to present

supplemental evidence, as well as to submit supplemental written memoranda and

requests for findings.   The parties declined the opportunity for a supplemental

hearing to submit additional evidence regarding the cost of clearing the property of

trees in preparation for agricultural use.      The parties submitted supplemental

requests for findings and brief supplemental memoranda of law.                     Upon

consideration of the evidence as illustrated by the site visit, and of the written

memoranda and requests for findings filed by the parties, the Court finds and

concludes as follows, in addition to the findings and conclusions of the 2009

Decision and Order not implicated in the remand. Findings and conclusions from

that decision are restated here only as necessary.

        Applicant proposed a multi-unit affordable housing development, known as

Brookside Village, which was granted an Act 250 permit and is the subject of the

present appeal. The parties do not contest the grant of the permit. The parties agree

that 10.85 acres of soils with an agricultural value of 6, and therefore classified as of

“statewide” importance under the USDA-NRCS soils classification system, will be

affected by the project. These soils are located on the project property on a plateau

above the floodplain of the Winooski River and contain a healthy eastern woodland,

including some stands of mature trees as well as regenerating eastern woodland of

predominantly hardwood species.        Applicant does not dispute the quality of the

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soils on the project property, their physical and chemical characteristics, or their soil

map classifications.

       The parties also do not contest that payment of an off-site mitigation fee is

appropriate if the soils at issue do qualify as primary agricultural soils. The parties

have entered into a mitigation agreement in compliance with subsections (i) through

(iv) of 10 V.S.A. § 6086(a)(9)(B) and with 10 V.S.A. § 6093, to take effect if the

10.85-acre area is determined to constitute primary agricultural soils under 10 V.S.A.

§ 6001(15).

       The cost of clearing the trees from the property for the purpose of building

the housing development is approximately $150,000.3                 This cost includes

approximately $20,000 allocated to professional loggers for tree cutting and removal

of the cut trees; approximately $50,000 for erosion control during site preparation;

approximately $40,000 in “machine time” for the leasing, labor, and fuel costs for the

machines necessary to do the site preparation work, including removal of the

stumps and roots; and approximately $40,000 for trucking stumps and roots away

from the site, including the dumping fees for those stumps and roots. However, not

all of the components of this cost would be required if the land were to be cleared

for agriculture.


3
   This cost is the cost of clearing about ten acres of trees for the entire proposed
development. However, no evidence was presented that all of the ten acres of
clearing would be taking place on the 10.85 acres of soils classified as “statewide” at
issue in this appeal. That is, 1.21 acres of soils that do not qualify as farmland of
“prime,” “statewide,” or “local” importance under the USDA-NRCS classification
system are also affected by the project. If any of that area of unrelated soils needs to
be cleared for the project development, the development cost figures should be
discounted by that amount, as the only issue in the present case on remand is the
cost of clearing the agricultural soils for farming. If the estimated cost of clearing the
land for the proposed development is allocated entirely to the 10.85 acres at issue,
the cost of conversion of the land for development is, as stated in Applicant’s
memorandum, approximately $13,825 per acre.

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      The cost of clearing the trees from the property in preparation for agricultural

use would be far less than that required for development. The $50,000 cost of

erosion control during the site preparation and development process would not be

incurred by a farmer. With regard to erosion control for development, Applicants

were required to prepare and follow an erosion control plan, required for

construction projects, because the ground surface is disturbed during site

preparation and construction. One requirement of the plan, for example, is for the

developer to stabilize the soil at the work entrance to the site by putting down

erosion control matting. By comparison, an erosion control plan is not required for

simply logging the land. Loggers must instead comply with certain management

practices standard in the industry and therefore included in the professional logger’s

estimate of $20,000 for logging and removing the cut logs and tree debris.

      There is good access from the project property for the removal of timber to a

flat area at West Street. There is no technical or physical impediment to the removal

of trees from the 10.85-acre portion of the project property at issue in this appeal.

The mature trees have value if harvested for timber, although the dollar value of

that timber was not established in evidence.       The regenerating forest and the

branches and debris from the mature trees would have value if harvested for wood

chips to supply the nearby McNeil electric generating plant, although the dollar

value of the wood chips was not established in evidence.4

      For agriculture, although the stumps and roots have to be removed from the

soil in order to farm, they do not have to be taken off site, but can be left in stump

dumps on the site but away from or at the edges of the agricultural fields. Thus,


4
  The estimate of $20,000 for logging during construction is net of expected revenue
to the logger from sale of the trees for lumber or wood chips. The fact that revenue
from sale of the trees is included in the $20,000 of the cost allocated to logging does
not change the result in this case, as further discussed below.

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even if the removal of stumps and roots from the ground, in preparation of the land

for agriculture, would have incurred the entire $40,000 of machine costs as would

have been incurred for development, none of the other $40,000 of trucking costs and

dumping fees (to take the stumps and roots away from the property) would have to

be incurred to prepare the property for agriculture.

        Thus, even using the cost components as estimated by Applicant, the cost of

tree removal to convert the land to agriculture is likely to be approximately a total of

$60,000, calculated from the $20,000 allocated to logging the property plus the

$40,000 of machine costs for removing the stumps and roots and placing them

elsewhere on the property away from the agricultural fields, or a total of

approximately $5,530 per acre for the 10.85-acre area.

        In addition, a farmer can further overcome the cost of tree removal for

conversion to agriculture by removing the trees over an extended period of time, by

using the revenues from farming on the earlier-cleared acreage to offset the cost of

later clearing, and by doing some or all of the work using the farmer’s own labor

and equipment rather than by incurring the cost of outside logging or stump-

removal contractors.     If the work is done by the farmer, the revenue to the farmer

from the sale of trees for lumber or wood chips would further overcome the cost of

tree removal.

        Balanced against the cost of preparing the land for agriculture, a small,

diversified specialty vegetable and soft fruit farming operation could succeed on the

10.85-acre portion of the project property if that portion of the property were cleared

of trees.   The cleared property would be capable of earning a gross income of

approximately $22,500 per acre if used for a Community Supported Agriculture

(CSA) operation.5


5   Although the Court also found in the initial decision that the 10.85-acre portion of

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       This gross income of $22,500 per acre would therefore be able to offset even

the $13,825-per-acre one-time cost of tree removal for development, if amortized

over just a few years. It would certainly be able to offset the $5,530 per acre one-

time cost of tree removal for agriculture, particularly if amortized over a few years.

The costs may be further reduced if the trees are removed over an extended period

of time, if the work is done by the farmer, and if the cost is offset by sale of the trees

for lumber or wood chips. In any of these scenarios, the cost of clearing the 10.85

acre area at issue in the present case for agricultural use is not “so high that

conversion of the land into agricultural use is not economically feasible.” Village

Associates, 2010 VT 42A, ¶ 23.



       Accordingly, based on the foregoing, it is hereby ORDERED and ADJUDGED

that the project will result in the reduction of the agricultural potential of 10.85 acres

of primary agricultural soils, and therefore that the previously agreed amount of

off-site mitigation fee is required to be paid.



       Done at Berlin, Vermont, this 6th day of January, 2011.




                             _______________________________________________
                                   Merideth Wright
                                   Environmental Judge




the property could contribute to nearby agricultural operations if cleared of trees
and planted in hay or used for pasture, for the purposes of considering whether the
cost of conversion for agriculture is economically feasible, it is appropriate to
consider the more intensive and more value-added CSA use in that calculation.

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