HB 1325

FARMLAND PRESERVATION FUND Subject to annual appropriations, this bill establishes a fund for the development and implementation of programs that benefit Tennesseans by preserving farmland and forestland, including a grant program for conservation easements. Wit hin such fund, this bill establishes a special agency account, to be known as the farmland preservation fund, which must be administered by the commissioner of agriculture, for funds allocated to the department of agriculture for purposes of this bill. GRANT PROGRAM This bill requires the department to develop a grant program within the farmland preservation fund for farmland and forestland owners to enroll their land in a permanent conservation easement held by a 501(c)(3) nonprofit organization that is exempt from federal income taxation and that acquires or proposes to acquire a conservation easement on farmland or forestland in the state, whether through purchase, donation, or other transfer ("qualified easement holder""). This bill authorizes the department to award a grant to a qualified easement holder or directly to the farmer or forester. A grant application must include, at a minimum, proof satisfactory to the department that (i) the farmer or forester has entered into, or has contracted to e nter into, a conservation easement with a qualified easement holder; and (ii) the farmland or forestland covered by the conservation easement will be used for farm or forestry purposes. PROHIBITIONS This bill prohibits a qualified easement holder from s elling, transferring, releasing, or otherwise divesting a conservation easement acquired by participating in the grant program. Additionally, this bill clarifies that governmental entities are not eligible to participate in the grant program. RULEMAKING This bill authorizes the commissioner to promulgate rules to effectuate this bill, including the establishment of eligibility criteria. ON APRIL 16, 2025, THE HOUSE SUBSTITUTED SENATE BILL 207 FOR HOUSE BILL 1325, ADOPTED AMENDMENT #1, AND PASSED SENAT E BILL 207, AS AMENDED. AMENDMENT #1 makes the following revisions:  Applies the bill to farmers and forest landowners, instead of farmers and foresters.  Requires, in order to be a ""qualified easement holder"" as used in the bill, a 501(c)(3) nonprofit organization to meet any requirements established by the commissioner of agriculture by rule.  Removes the requirement that a grant application include a prohibition on a qualified easement holder from sell ing, transfer ring, releas ing, or otherwise divest ing a conservation easement acquired by participating in the grant program.  Requires, instead, a conservation easement acquired by participating in the grant program to include all of the following conditions:  The qualified easement holder must not sell, transfer, release, or otherwise divest the conservation easement except upon the consent of the farmer or forest landowner .  A successor of a qualified easement holder is bound to the terms of a conservation easement .  Any amendment to a conservation easement acquired under the bill must only be made upon the consent of the farmer or forest landowner and qualified easement holder and become effective and enforceable at the time that such amendment is recorded in the register's office of the county in which the farmland or forestland is located .  The qualified easement holder must only have access to the property upon the consent of the farmer or forest landowner with reasonable notice at reasonable times .  The conservation easement must permit the erection, construction, or reconstruction of any building or other structure for agricultural or forestry purposes and must not restrict agriculture or forestry.  Clarifies that the Conservation Easement Act of 1981 applies to conservation easements created using grant funds from the farmland preservation fund."