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RECOMMENDATION: CREATE TAX INCENTIVES FOR . FARM & RANCH MANAGEMENT AGREEMENTS Farms and ranches prm'lde many benefits to Coloradans.. In addition to economic produCtivity that generates $45 billion in production value within the St3terx..tee N_"f"'lI"hnStor.."",s...-ei. farms and ranches sustain much of the habitat for native, threatened and endangered species and provide importam amenities like clean Waler. clean air. soli conservation and recreation opportunities. Coloradans have already said that they wam to pennanently protect farm and ranch land from development through the use of marketable state tax credits for the donation of conservation easements However. the Commission belleves that the State should establish incentives that encourage and acknowledge the emironmental stewardship tha! farmers and ranchers provide_ The Commlsslon recommends that the General Assembly provide lax credits for farmers and ranchers who enter into management agreements 10 protect critical wildlife. <lir. water. soli and other natural resources. For example. a farm may often provide habitat for native. threatened and endangered species, A farmer who works with the Division of Wildlife to voluntarily protect this habitat area should be eligible for a tax credit. The Commission recommends that management agreement tax Imponance of Color~do's Private land in En,"'ironmental Prolection Scu<. N_lu#otyRo.O<IIdI~e>'.US"'_~Seno<. I' .'"" :!il,<' . . . '.' . 5% State land credits be structured along the following !lnes management agreement than In year 14 Management agreements must be designed to provide specific environmental benefits such as protecting wildlife habitat and v.-atershed areas The agreement should last a minimum of 12 years and include a prohibitJon on subdl\iding or developing the land State environmental agencies. such as the Division of Wildlife. the Water Conservation Board. and the Soil Conservation Board. should establish a verifiable valuation method for the tax credits. For example. the Water Conservation Board should develop certification criteria for landowners who prolect valuable walershed areas The value of the tID: credit to the farmer or rancher should Increase IOcrementally the longer the management agreeme:Jt l.s enforced - ie.. the tax credit would be larger In yea: 18 of a \o.,'lthin the first twelve years of a management agreement. material vlolauons of the agreement by a fanner or rancher should result in . !,O