State May Change Policy on Farms in Urban Areas : Growth: The Wilson Administration no longer wants to encourage farmers near developed sites to keep their land in agriculture rather than develop it, a top official says.

Giving the first solid indication of a new strategy on growth, a top state official said the Wilson Administration wants the state to abandon a policy that encourages farmers near urban areas to keep their land in agriculture rather than develop it.

The proposed policy change, according to Resources Secretary Douglas Wheeler, will be included in Gov. Pete Wilson’s long-awaited growth management plan, which is scheduled to be released early next year.

The plan, according to Wheeler and another Administration official, will seek to encourage growth in places where public services already exist while discouraging development in outlying areas where roads, sewers or schools have yet to be built. Wilson implemented a similar plan when he was mayor of San Diego.

Although Wilson’s general goal meshes well with policies favored by statewide advocates of growth management such as the Sierra Club, it could generate opposition from neighborhood groups that have formed to fight construction on the limited amount of open space that remains within or near city boundaries.

A key element would be the treatment of farmland under the Williamson Act, a state law that subsidizes farmers who agree not to build on their land.

Wheeler said the law needs to be changed because the state, in essence, is wasting money by paying farmers not to build on land where development is inevitable.

“If you protect agricultural land which you know is going to be converted, you are spending money not as effectively as you might otherwise,” Wheeler said in an interview.

The Williamson Act, adopted in the 1960s to preserve California’s dwindling supply of farmland, works by reducing property taxes for farmers who sign contracts saying they will not build on their land for at least 10 years. During the course of the contract, the land is assessed for taxes as if it were in a remote setting, where values are lower because there is little potential for development.

The closer the farm is to an urban area, the bigger the property tax reduction and the higher the cost to the state. The state last year paid $14 million to reimburse counties for the property taxes they lost under the program.

“You are paying a high premium (for that land) and you are probably engaged in an action to delay, not deter, development,” Wheeler said.

Richard Sybert, Wilson’s director of planning and research and the coordinator of the governor’s growth management strategy, would not confirm that the proposal Wheeler described was part of the Administration’s emerging policy, which remained under wraps Wednesday. But he defended the concept of redirecting the Williamson Act funds. The idea was one of dozens of recommendations that came from research Sybert has directed since Wilson took office.

Sybert noted that 40% of the money paid each year under the program goes to encourage farming on land within three miles of existing urban areas. The change Wheeler disclosed would phase out the payments on land within urban “spheres of influence,” the lines that cities establish as their probable future boundaries.

“The state has got a limited amount of money to spend,” Sybert said. “It ought to focus that money on the agricultural lands which are in fact more likely to remain in agricultural production. Those are lands that are not in the existing urban area.”

The policy change could run into political problems stemming from two conflicting notions of growth management.

Wilson’s view is that growth is inevitable, and so the state ought to do what it can to direct development to places where the least environmental harm will be done. From a statewide perspective, that means encouraging growth in areas where public services and jobs already exist.

V. John White, a lobbyist for the Sierra Club, said the group generally supports Wilson’s goals, although it will reserve comment on the Williamson Act provision until it sees a complete plan.

“Any growth management plan has got to encourage higher densities in the appropriate areas,” White said. “It’s going to be hard to save what needs to be saved if we practice low-density development and sprawl, and automobile-dependent transportation.”

But dozens of local groups that see themselves as advocates of growth management were nonetheless organized to fight the very kind of urban development Wilson favors.

These groups tend to see the Williamson Act as a savior because its subsidies have prompted farmers to keep their land in crops rather than sell to real estate developers who want to build houses, apartments or commercial parks.

Just as the financial value of the farms increases the closer they are to existing development, so does the “psychic value” of having a belt of green amid the asphalt and concrete. A small field of strawberries or flowers that, from a statewide perspective, may not seem worth saving can be the subject of bitter and emotional battles at the neighborhood level. These fights have occurred throughout the state, from Brentwood, east of the Bay Area, to Encinitas in San Diego County.

But Sybert said those skirmishes are best fought without the added complication of state subsidies that can interfere with the logical pattern of growth.

“What we are talking about is, ‘If you, Mr. Homeowner, want that strawberry field preserved, then maybe you ought to pay for it,’ ” Sybert said. “The rest of the state, through Williamson Act funds or some other mechanism, ought not to be asked to pay for it, because if it does, you’re getting subsidized by all the other taxpayers.”