Expiring Farmland Agreements
Expiring Farmland Development Rights Agreements
Farmland Development Rights Agreements are a temporary restriction on the land between the State and a landowner and preserves the land for agricultural purposes in exchange for certain tax benefits and exemptions for various special assessments. These agreements are commonly known as PA 116 and have an expiration date that is unique to each agreement. It is the responsibility of the landowner to notify MDARD of the intention to extend the agreement within 6 months of the natural termination date of the development rights agreement, or to inform MDARD of the intention to allow the agreement to expire (MCL 324.36107).
Pursuant to MCL 324.36111(8), if a Farmland Development Rights Agreement is allowed to EXPIRE, there is a required repayment of tax credits taken during the final seven (7) years of the Agreement. The amount of repayment (or amount of lien) is calculated by the MICHIGAN DEPARTMENT OF TREASURY upon expiration of the agreement. MDARD will notify you of this amount in writing and if the amount is not paid within 30 days from the date of notification, MDARD will be required to place a lien on the property described in the Agreement. A lien will not be required if you or any prior owners have not claimed tax credits during the final seven (7) years of the agreement.
If the ownership of the property described in the Agreement(s) has changed, please submit a TRANSFER REQUEST to our office. The request should include a cover letter along with a copy of the recorded deed from you to the new owner. Please make sure to include the address of the new owner for future correspondence. Please remember to reference your Agreement Number in all correspondence and identify any address corrections that are needed.
Reentry in a Farmland Development Rights Agreement is allowed if a landowner allows an agreement to expire. Any liens filed after the expiration of the agreement will be discharged upon successful renewal or reentry in a Farmland Development Rights Agreement. Please note that any subsequent lien cannot be less than the amount of any previous lien discharged (MCL 324.36111(7)).
A reinstated agreement can only be approved if the ownership and the legal description of the property has not changed since expiration of the agreement. The landowner must agree to re-instate all of the land described on the agreement for a minimum of 10 years. If approved, MDARD will prepare and record a discharge of lien.
To request a reinstatement of an expired Farmland Development Rights Agreement, please complete and submit a written request to MDARD using the PA 116 Reinstate Form.
Requests and forms should be emailed to: MDARD-PA116@michigan.gov
Or mailed to:
Farmland and Open Space Preservation Program
Michigan Department of Agriculture & Rural Development
Environmental Stewardship Division
P.O. Box 30449
Lansing, MI 48909
Or faxed to: 517-335-3131