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Adjusting the Zone Defense

As farms develop new businesses, townships remove old obstacles

August 24, 2003 | By Patty Cantrell
Great Lakes Bulletin News Service

Black Star Farms
  Black Star Farms’ plans to operate a vineyard and winery, a cheese-making operation, a bed and breakfast, and stables served as a catalyst for changing zoning laws in Bingham Township, located in the Leelenau Peninsula.

With Traverse Bay’s deep blue waters sparkling in the background and brilliant cherry blossoms gracing proud farm homes, it’s easy to see why Michigan’s Old Mission Peninsula is again leading the farmland preservation movement. A year ago the Peninsula Township Board of Trustees took another pioneering step when it passed an innovative zoning amendment to help local growers pursue new business opportunities.

The amendment is one of several groundbreaking efforts in Michigan and across the nation to help farmers stay in business and on their land. Communities are adjusting their zoning so that farms can engage in a new set of entrepreneurial, agricultural activities — from wine tastings and weddings to farming classes and cheese making.

Nine years ago, Peninsula Township residents were the first in the state to tax themselves to save farmland by purchasing farmland development rights. But even before that historic initiative, the area’s residents and leaders knew that a purchase of development rights (PDR) program was not by itself enough to support the local farming culture that protects the breathtaking landscape.

That realization had already moved the township in the late 1980s to expand its agricultural zoning to allow both winemaking and larger roadside stands. It also permitted the use of hired labor and products from other area farms.

“We recognized we need to preserve an industry,” said Gordon Hayward, Peninsula Township planner.

New Tools for New Times
The township board’s action last August marked another major step forward. With its Farm Processing Amendment 139, the township was the first in Michigan to move a set of processing and retail activities from “special uses” on farms to “uses by right.” The township long had allowed processing, such as canning or freezing cherries, in agricultural zones. The amendment goes further, however, to define retail sales and processing as part of the farm operation itself.

This eliminated the long and often contentious process farm operators faced when they applied for special use zoning permits to develop new business directions. It also reflects a growing recognition among community leaders that a new brand of entrepreneurial agriculture not only can fit well with the rural landscape but also is vital for providing the new sources of income farm families need to keep working their land.

Leaders across the political and business spectrum agree that moving Michigan agriculture toward more “value-added” production, such as developing new products to meet new consumer demands, is essential for ending the farm failures that make way for sprawl. Zoning innovations for agriculture — along with business training, marketing assistance, and strategic planning — are tools communities are using to reduce their farms’ dependence on global markets that increasingly pay beans for blue-ribbon fare.

Give and Take
It takes work to reach consensus on what commercial activities are appropriate and how they relate to land preservation. But Old Mission Peninsula residents say the process is worth it because it moves them toward their goal of building strong farms to preserve the area’s high quality of life. Amendment 139 offers a good model for doing that. For example, the amendment helps local farms build profitability, but it also is designed to alleviate residents’ concerns about the potential for rampant commercialization of the peninsula.

Planning commission chair Ginny Coulter says vigilance about over-commercialization is just as important as concern about farmland loss.

“In this flurry to assist agriculture,” she said, “I think we need to be really careful not to allow too many retail-oriented uses on agricultural land. And when it comes to imports, you have to look at where to draw the line on that. Is selling wine from Chile a local use?”

To ensure that wineries and other entrepreneurial activities on the township’s farms actually support local agriculture, the amendment requires that 85 percent of the raw materials processors use for making their products, such as wine, come from within the township. A majority of those materials must come from the processor’s own farm; they must also operate at least 40 acres to qualify. But the 40-acre minimum requirement is flexible; it allows operators to lease up to 20 of those acres elsewhere on the peninsula. That helps farmers who can’t afford to buy a full 40 acres at the peninsula’s high prices, says John Wunsch, a resident who helped craft and promote the amendment.

In the case of wine, the 85 percent local-content requirement matches federal guidelines for selling wine under the “Old Mission” appellation, a legal system that regulates identifying a product by its place of origin. The success of the peninsula’s wineries, as well as the farmers planting vineyards to supply them, depends on this regional identification. That is something the new zoning supports, says Bob Begin, owner of Chateau Chantal, a winery that buys grapes from six other farms beyond its own 40 acres of vineyards.

“Depending on the demand we create with the appellation, wineries will buy more grapes from other farmers here,” he said.

My Cheese and Your Cows
While not every farm gets its way under new entrepreneurial agriculture zoning changes, widening traditional definitions can lead to some major farmland benefits, says Bob Gregory, a cherry producer near Suttons Bay in Leelanau County, another wine-making area in northwest Michigan.

As Bingham Township planning chair, Mr. Gregory has been involved in a number of agricultural zoning changes in recent years that the township made to accommodate and encourage farm diversification. Most of them stem from requests by Black Star Farms, which moved to the township in the late 1990s with business plans that included establishing vineyards, stables, a bed and breakfast, a winery, and a cheese-making operation on its 120 acres.

“They were patient with the planning process, and it has evolved into some things I think are mutually beneficial,” Mr. Gregory says. One is a system for managing the variety of events that wineries hold to attract customers but that can create traffic, sanitation, and noise issues. The solution is a contractual arrangement by which wineries forecast the types and number of events they will hold and show how they will address fire safety and other issues.

The township annually reviews how well the wineries meet those expectations, says Dan Carlson, Bingham Township zoning administrator. The township also accommodated Black Star Farms’ plan to become an agritourism destination by developing a “bed and breakfast inn” category, which allows up to eight guest rooms. The township’s original “bed and breakfast” category allowed for only three guest rooms.

When it came to cheese making on the Black Star property, the township also addressed issues that its agricultural zoning did not already cover, such as trucking raw product and disposing of whey.

“Cheese and wine do have a natural companionship with each other,” Mr. Carlson said of the need to recognize the business and farmland relationship. In fact, the cheese-making operation at Black Star Farms buys milk from one of the county’s eight remaining dairy farms. But, in a difficult agricultural zoning compromise, Black Star Farms had to buy a 1 percent share in the ownership of the cows to do it.

Other States, Other Ideas
Similar trade-offs show up in other efforts around the country. One of the most comprehensive overhauls of agricultural zoning in the nation is underway in Snohomish County, Washington, north of Seattle. The chief goal of a wide range of amendments submitted to the county’s planning commission last March is updating the concept of farming from strictly raising crops to include processing, packaging, and selling them, says county planner Tom Niemann.

Eliminating a vast gray area concerning allowed uses was key. “There were even questions on smaller-scale stuff, such as buying lettuce from neighboring farms and washing and packaging it for a farm stand,” he says of past zoning. “Many farms are already doing it illegally … we’re trying to expand the range of uses, as well as make the permit process easier and — in some cases — avoid it altogether.”

One of Snohomish County’s changes expands the allowed size of farm stands from 500 square feet to 5,000 square feet, but with the provision that 50 percent of items sold come from the county and 75 percent from Washington State. The proposed amendments also specifically allow for agricultural support businesses, such as implement repair, and for activities, such as pumpkin festivals and company picnics.

Snohomish County and northwest Michigan are not alone in their desire — and need — to make permitting clearer and easier for the farms they want to save, said Duncan Hilchey, agricultural development specialist with Cornell University’s Farming Alternatives Program in New York. Farmers across the country are caught in a confusion of what business activities local governments will allow on agricultural land.

“But if communities want to maintain their agricultural character,” he said, “they may need to give up an acre for a larger farm stand and allow for some gravel and parking to save the rest of the land.”

Patty Cantrell, an economist and journalist, manages the New Entrepreneurial Agriculture project at the Michigan Land Use Institute. To reach her, write patty@mlui.org. Information and a registration form for the Institute's Seeds of Prosperity conference in Thompsonville, Mich., Nov. 11-13 is available by clicking here. For more information on New Entrepreneurial Agriculture see the Farmland Protection section of the Institute’s Web site at www.mlui.org. A version of this article appeared in the July 2003 edition of Michigan Planner, the magazine of the Michigan Society of Planning.

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