Big homes, low property taxes affecting farming in Abbotsford: report

City-commissioned study confirms that non-farmers are increasingly eyeing agricultural properties in Abbotsford

The quest for estate homes and a low threshold to obtain property tax breaks are affecting the viability of farming in the Fraser Valley, a new city report says.

The two issues – which were both recently highlighted in an ongoing series in The News – are among the challenges facing the three-quarters of Abbotsford land that is in the Agricultural Land Reserve (ALR), according to a “draft background research report” completed for a review of Abbotsford’s farmland policies and bylaws.

“The use of agricultural land for estate homes is a growing concern as people seek places to have a large home, garage, pool, and yard on affordable land,” the report says. “Demand for single-family residential accommodation continues to grow and migrate east from Metro Vancouver and adds additional pressures on the ALR in Abbotsford.”

In late July, The News reported that agricultural properties are regularly marketed towards those looking to build or live in their dream homes, rather than to people hoping to farm professionally. And earlier this month, The News revealed that a farm-income threshold of just $2,500 makes it relatively easy to qualify for “farm status” and the associated property tax discount.

The recently issued research report – which was presented to the city’s agriculture committee earlier this month – indicates that demand for industrial property is also increasing pressure on agricultural land.

“The shrinking supply of industrial land within Metro Vancouver has prompted some industrial businesses to consider relocating to ALR and industrial-designated land in Abbotsford for both short- and long-term growth,” the report says. “Interest in ALR land for non-agricultural or rural estate development has contributed to inflation of agricultural land values to the point where it is challenging for new farmers to purchase viable farmland.”

As part of the farmland policy and bylaw review – dubbed AgRefresh – the city received feedback from many who said tax rules provide “impetus for speculation and under-utilization of ALR properties” and said the city should take up the issue with BC Assessment.

This spring, Metro Vancouver received a report that suggested the threshold should be increased. It is planning to deal with the issue in the coming months. City manager George Murray had told The News that Abbotsford wouldn’t be taking a stance until receiving the information being compiled for AgRefresh.

Meanwhile, food processors operating on industrial land are saying the increasing number of similar operations operating on ALR properties are gaining an unfair competitive advantage.

While food processors have traditionally been located in industrial areas, the report notes that there’s been “a growing desire to process primary products on the farm.” That has resulted in those located on industrial land claiming their ALR counterparts receive taxation advantages. Recent rules have given a further boost to on-farm processors by allowing cooperative groups to operate on ALR land.

However, the report notes that on-farm processors may find it harder to expand because they have less access to water, or other city services. It also includes feedback from various respondents, including a report by Peter Reus, who operates a greenhouse facility and farms endives on Sumas Prairie.

Reus, with assistance by soil specialist Geoff Hughes-Games, wrote that several agriculture-oriented businesses could be located on commercial lands outside the ALR, thereby freeing up valuable farmlands.

“Historically, large-scale food processing was consolidated in central locations, now it appears to occur on many individual farms,” Reus wrote. “Although this may be of benefit to individual producers it removes land from production. This is slowly eroding the productive land base and leaving risks of unused facilities if markets shift.”

The city’s report also shows how important Abbotsford is to the province’s agriculture industry and, in particular, to the supply-managed dairy and poultry sectors.

According to the report, 55 per cent of all eggs produced in the province come from Abbotsford. Half of all turkeys are Abbotsford-bred, and 22 per cent of all milk produced and 34 per cent of all chickens bred in B.C. originate here.