Summary of a Recent
Judicial Development in
Conservation Programs

Financial Assistance Disallowed After
Sale of Conservation Easement

Chuck Munson
National AgLaw Center Graduate Assistant

Summary of Decision

In Coulter v. St. John's Water Management District, 799 So.2d 267 (Fla. Dist. Ct. App. 2001) the District Court of Appeal of Florida, Fifth District, held that dairy farmers who were forced to relocate their dairy operation were not entitled to federal financial assistance under the Uniform Relocation Assistance Act (URA), 42 U.S.C. §§ 4601-4655. The plaintiffs relocated their operation as a result of a land sales transaction between the water management district and the USDA that involved the district's purchase and subsequent sale to the USDA of a conservation easement under the Wetlands Reserve Program. Coulter, 799 So.2d at 268.

Background

The plaintiffs in this action operated a dairy farm on property owned by the local water management district. Id. A term of the sales contract between the district and the USDA was that all dairy cattle and dairy operations had to be removed from the property. Id. Consequently, the plaintiffs incurred significant expenses in relocating their dairy operations to a new location. Id. A part of the transaction also involved the water management district's purchase of a conservation easement under the Wetlands Reserve Program and subsequent sale to the USDA. Id. The plaintiffs requested relocation financial assistance from the district under the URA and a Florida statute that authorized Florida state agencies and departments to comply with the URA. Id. at 269.

Analysis and Holdings

The court's analysis turned on whether the "displacing agency," which was the water management district, received "federal financial assistance" as required under the federal and state statutes at issue. Id. Under the URA, "federal financial assistance" is defined as "a grant, loan, or contribution provided by the United States." 42 U.S.C. § 4601 (4). Id. at 269 n1.

The court concluded that

in the instant case the federal government did not make a "grant, loan, or contribution" to the district. As pointed out by the Administrative Law Judge below, the terms "grant" and "contribution" suggest a donation or subsidy, and the term "loan" suggest the temporary use of federal funds. Here, the federal government did not provide a loan to the district. The fact that the federal government transferred the purchase money to the district a few days before the sale closed does not make the transaction a loan: the USDA did not need to put money in escrow pending the district's execution of the easement, because the district is a governmental entity. The federal government did not provide the district a subsidy, but paid $4.2 million for a 30-year conservation easement across the non-dairy parcel, and there is no suggestion in the record that the amount paid was less than the fair market value of the easement. And, as pointed out by the Administrative Law Judge, the Wetlands Reserve Program does not authorize any grants, loans, or contributions. Instead, the USDA is prohibited from paying more than fair market value for easements . . . .
Id. at 269-70.

Based on the above interpretation of the statutes, the court ruled that the plaintiffs were not entitled to relocation assistance from the water management district. Id. at 270.

The case was decided on November 13, 2001; this summary was posted Nov. 28, 2006.