Acquisition of fee simple title to agricultural lands. Lease of property.

(b) After the acquisition of the fee simple title of any agricultural real property and any related personal property, the commissioner shall: (1) Sell such property, exclusive of any development rights, for agricultural purposes as soon as practicable and retain any development rights, or (2) if the purchaser is a municipality or a nonprofit organization that has the preservation of agricultural lands as one of its purposes, the commissioner shall sell such property for use as agricultural land, including any development rights, and enter an agreement with such municipality or nonprofit organization for the purchase of such land's development rights. The commissioner may lease or otherwise transfer, assign or manage such property for agricultural, open space or other qualified purposes, in accordance with subsection (d) of this section, until such time as a sale as required by this section is completed. (c) The commissioner may lease all or part of one property acquired by him under this section as part of a demonstration project, in accordance with subsection (d) of this section, provided such project is approved by the Secretary of the Office of Policy and Management. Such property may be leased to one or more agricultural users for a period not to exceed five years. Such lease may be renewed for periods not to exceed five years. Any property leased under such demonstration project shall be exempt from taxation by the municipality in which the property is located. The assessed valuation of the property shall be included with the assessed valuation of state-owned land and buildings for purposes of determining the state's grant in lieu of taxes under the provisions of section 12-18b . (d) No contract to sell, lease or otherwise transfer, assign or manage such property for agricultural, open space or other qualified purposes shall be entered into by the commissioner unless there has been a finding of the State Treasurer that such contract will preserve the exclusion from federal taxation, if any, of the interest on the bonds of the state issued to finance such acquisition. Any proceeds derived from any such contract shall not be deemed revenues of the General Fund and shall be deposited in the appropriate bond proceeds account. Any such proceeds shall be applied, upon allotment thereof, to acquisition of additional agricultural real property and related personal property or, upon approval of the State Bond Commission, for such other authorized capital purposes which the State Treasurer finds will best assure the preservation of such exclusion from federal taxation, if any, including payment of the principal, redemption price, if any, or interest on the bonds issued for the purchase of the agricultural property.