Conservation easement
Almost every American city faces problems of sprawl development, declining tax bases, and depreciating infrastructure. Many have developed innovative practices and programs to address these and other problems. Conservation easements are one of these many innovative practices. Conservation easement aims to give landowners the legal basis for the protection of their property from unwanted development while they retain the ownership of their property. The program also provides the incentives for people to participate in it as property owners get a federal tax deduction for taking part in the program. The tax cut in a way serves to encourage people to take part in the protection of the natural habitats on their property.[1] As the US government wanted to protect and preserve the environment it saw that it could not afford to buy more private land that needed preservation, this led to the invention of easements where private property would be protected under the US law if the owner so wished to do that. Easements were first used in Boston in the 1880s to protect parkways.[2] The process followed for a conservation easement to be effective starts with a landowner donating part of his ownership rights, to develop the land, to a conservancy to ensure the protection of the land. The landowner still retains private ownership of the land and the landowner can still sell or give away the property while the conservancy enforces the terms of the easement in perpetuity. The landowner benefits from the protection of his/her property and from federal tax deduction for the easement donation. 1
The process is
summarized below. 3
Step 1. Tour the property to
evaluate the natural resources
X X
and determine if an easement is
appropriate.
Board for their approval. X
Step 3. Advise the landowner
to consult with legal
and tax advisors.
X
inspection report. X X
Step 6. Obtain mortgage
subordination from lender if lien exists.
X X
Step 8. Obtain a
"qualified appraisal".
(If claiming a federal tax deduction over $5000.) X
Step 9. Sign
and record final version of easement. X X
The conservancy enforces the requirements stipulated in the easement. This is done through making the documentation language of the easement clear and enforceable. The conservancy monitors land use on a regular basis and reviews and approves land use as written in the easement and use the legal system to enforce this. The conservancy also provides information and background data on the easement to future owners of the land/property covered by the easement.[3] Conservation easement is a voluntary procedure, however when it is being practiced, it is recognized under the federal laws and as such will be enforced by the federal, state and local authorities.[4]
The Conservation program is run through government and private funding. Although the government cannot afford to buy all pieces of land that it would want protected or conserved, it still provides some funds to alleviate financial difficulties faced in running the program. Many private organizations that accept conservation easements set up easement monetary funds. The funds are needed for the perpetual obligation by the conservancy to the protection of the land in the agreement. An example of where the funds can be used is in legal battles with developers who might wish to fight the easements’ constrains on development. For example Section 388 of the 1996 Farm Bill enacted the legislation to ensure funding of up to $35 million for over six years for the purchase of agricultural conservation easements and other methods of protecting the farmland conversion to non agricultural uses[5] and Summerseat Sanctuary and Farm, a conservancy based in Southern Maryland is involved in conservation easements. It has raised approximately $40,000 from private sources through memberships, individual gifts and fundraising events.[6]
An example of when this program was used is when Will and
Susan Wood who have an 80-acre farm with great views of Lake Michigan and has
wetlands and cedar woods in and around it, wanted to protect their farm from
residential subdivision. Property around them was sold and developed for
residential plots. When Will died in 1985, Susan had to deal with tempting
offers from developers who wanted to turn the farm into residential lots and
she also had to deal with increased taxes on the farm. Susan placed the farm
under a conservation easement to ensure that the agricultural heritage of the
land was maintained. The easement also reduced the taxes she had to pay for the
farm. The conservation easement agreement was drafted into Susan’s will and
will continue in perpetuity unless if Susan removes it. 1
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