Seattle area tries new program to save farmland for contented cows

Tucked into lush valleys nestled among the thickly forested hills which surround Seattle are the most productive dairy farms in the nation. The slogan ''milk from contented cows'' was coined here.

But contented cows were well on the way to becoming endangered species here until recently. Like the agricultural lands on the fringe of fast-growing urban areas throughout the nation, dairy farms and other agricultural land in King County have been gobbled up for commercial and industrial development at a breathtaking pace, averaging over 3,000 acres annually for the last 30 years, as the Seattle metropolitan area has expanded dramatically. As a result, agricultural land now constitutes only 2 percent of the county.

Concern over this situation among the area's farmers and urban dwellers alike led to the creation of one of the most ambitious voluntary farmland preservation programs in the nation. Using money from bond sales, the county will purchase development rights on the agricultural land that remains, blocking further farmland loss and enabling farmers to continue their trade.

For a while a successful legal attack on the program's funding mechanism left it in limbo. But now alternate methods of raising the revenue to buy up development rights have been hammered out and it appears that the program is ready to swing into operation.

''This program will benefit everybody - the farmers, the consumers, even the developers,'' maintains Scott Wallace, a third-generation dairy farmer from nearby Carnation. The most important benefit to farmers, he says, is the fact that this will stabilize agriculture land values and allow the transfer of land between generations.

''The thing of it is, those of us who live on the land have a different feel for it than your investor,'' he says. ''A program that preserves the land, as long as it's fair, (the farmers) will go along with it.''

King County is committed to raising $50 million from the sale of bonds backed by a countywide property tax levy. For the owner of an average house, this will add an extra $8 to the property-tax bill, estimates Eugene Duvernoy, the program's new director.

''Once we have gotten started, this will be the largest program of its type being carried out at the local level,'' he says.

Although it has not yet begun, the program is being watched as a good model, says Hal Hiemstra, farmland project director of the National Association of State Departments of Agriculture Research Foundation.

In 1979, when 63 percent of the county's voters approved of the program, it was assumed that this money could be raised by issuing traditional general obligation bonds. But the program's opponents, mostly in the real estate industry, sued and won when the county tried to float the bonds at the going interest rate. This was in violation of a provision which limited the rate the county could offer to 8 percent or less.

In his 1980 campaign, county executive Randy Revelle promised to get the program going. After taking office, he set up a citizen task force, which recommended a complicated financing scheme that the county council began implementing this month.

This alternative funding method has two basic parts. The first $15 million will be raised by the issuance of a special kind of bond not subject to the 8 percent limitation. The remainder will be financed with the 8 percent bonds, but a special mutual fund will be set up to purchase the bonds. The county will then offer shares in the mutual fund to farmers in exchange for their development rights.

Although sale of development rights to the community would prevent farmers from selling land for development in the future, they retain title to their land and are compensated for the economic potential which is lost. Also, their estate and property taxes are reduced.

One drawback, says Mr. Hiemstra, is that this approach is an expensive way to protect the land, costing as much as $1,000 an acre.

In the 1979 vote, the strongest support came from the heart of Seattle. Benefits to the urban consumers, says Duvernoy, include access to fresher and lower-priced food and the preservation of productive open-space areas.

Studies also concluded the area contained adequate undeveloped land to accommodate growth without touching the remaining agricultural areas.

The intensity of developers' feelings toward the program could still have an impact. A petition to put the program up for another vote was filed recently. If it should gain the requisite signatures by Oct. 25, it would go on the ballot in November.