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Lexington board sets June 11 deadline for small‑farm PDR subordination letters
Summary
The Lexington City farmland preservation board set a June 11 deadline for applicants to provide lender subordination authorization required by the city's PDR ordinance, leaving noncompliant applications to roll into the next ranking cycle.
The Lexington City Farmland Preservation Board voted to require that small‑farm Purchase of Development Rights (PDR) applicants submit lender authorization of mortgage subordination by June 11, 2025, or be deferred to the next application cycle. The motion was made by Phil and seconded by Margaret; board members signaled approval by show of hands.
Board staff said the deadline is meant to resolve a bottleneck caused by applicants whose lenders are unfamiliar with agricultural subordination letters. Beth (staff) told the board that the program has about 37 applications under review and that "we have 17, I believe, of the 37 who have mortgages and have not been able to provide that yet." Beth said about 10 applications currently have no mortgages and could proceed immediately if the board approves rankings.
The PDR ordinance requires staff to present a ranked list of qualifying farms for board approval before authorizing appraisals. Tracy (counsel) advised the board to follow that ordinance process rather than advancing individual parcels on a rolling basis. Beth said staff sent a memo and a sample "willingness to subordinate" letter on May 8 to applicants and lenders and proposed a firm deadline to give lenders time to respond.
Board members discussed implementation constraints, including appraisal and closing capacity and the program's administrative requirements. One board member noted concerns about workload if all qualifying applications must be closed within a one‑year window; staff and counsel said they would follow the ordinance's ranking and approval steps and that noncompliant applications would "roll over" into the next cycle.
Under the plan approved by the board, staff will present rankings at the June meeting for those applicants who meet all criteria by the June 11 deadline. Applicants who do not meet the deadline will remain eligible for future cycles but will not be included in the June rankings or considered for appraisals in this round.
The board and staff discussed possible additional deadlines (August/September were mentioned) to manage subsequent rounds. Staff also said many applicants have national lenders, not agricultural lenders, which has made obtaining a willingness‑to‑subordinate letter more difficult.
Clarifying details provided at the meeting included: the staff count of approximately 37 applications; roughly 17 of those have mortgages and had not provided subordination letters as of the meeting; about 10 applicants do not have mortgages and could proceed; a sample letter and memo were sent May 8; and suggested administrative dates of June 11 and an alternate mid‑August/September deadline if needed.
The board's action: the motion to set a June 11, 2025 deadline to receive authorization of mortgage subordination on existing applications was moved by Phil and seconded by Margaret and approved by the board.
Board members and staff said they will return to the board with a ranked list of all applicants who meet the ordinance criteria by the deadline and will proceed with the ordinance's appeal period and appraisal authorizations thereafter.
