The Budget

Virginia operates on a biennial budget of which, we are in the second year. The Governor introduced his amendments to the budget in December. While our focus was on changes to the conservation grant programs and the Land Preservation Tax Credit, we were also concerned by the lack of funding provided for Agricultural Best Management Programs (Ag BMPs). That introduced budget became the foundation for the House and Senate Budget bills. Below is a brief description of the differences between the two budget bills.

Land Preservation Tax Credit:  

No major changes were made to the program in the budget. However, due to the budget shortfall this year – $1.5 Billion – the Governor’s introduced budget extended the $20k individual claim cap for one year. This was supposed to increase to $50k this year. The Governor also increased the transfer fee (related to the sale of tax credits) from 2-3%.  Both House and Senate Budgets include the $20k cap. Again, this is for one year and without a legislative change or mischief in the conference committee, we expect these to be the extent of changes this year with the individual claim increasing back to $50k next year.

The Senate Budget does not include the 2-3% transfer fee increase but the House does include that increase. The fee is not expected to have a huge impact to the program. However it does increase the fee a landowner would have to pay to transfer, or sell, the credits. A 1% increase adds another $10k per $1M credit claimed.

Land Conservation Grant Programs:

• The original budget included $10 million (M) split between the 3 grant programs. The Governor’s introduced budget included cuts to the three grant programs, leaving roughly $5.43M


  • Battlefields Preservation Fund – cut of $323,472 in FY18. Originally $1M
  • Virginia Land Conservation Foundation (VLCF)  – cut of $3.5 M in FY18. Originally $8M
  • Farmland Preservation Fund  – cut of $750,000 in FY18 – Originally $1M
• The House budget restored full funding for battlefields only.
  • Battlefields Preservation Fund – $1M total, full funding
  • VLCF – same as Governor’s budget
  • Farmland Preservation Fund – same as Governor’s budget
• The Senate restored some funding for battlefields.
  • Battlefields Preservation Fund – Restored $100,000 in FY18, $776,528 against the $1M
  • VLCF – same as Governor’s budget
  • Farmland Preservation Fund – same as Governor’s budget

Agricultural Best Management Practices (Ag BMPs)


• Needs for the program were estimated at roughly $61.2M. The introduced budget contained only the $8.8M that is generated from the recordation fee. There was an additional $8.2M left in the Water Quality Improvement Fund (WQIF) from last year. Remaining needs were not addressed in the introduced budget.


  • House provided $17M – $8.2M from WQIF and $8.8M from the recordation fee.
  • Senate provided $47M – $8.2M from WQIF and $8.8M from the recordation fee. The remaining $30M will be provided by a line of credit.