In an area where much of the surrounding property is being converted to urban use, Sally Brown's parcel of land will forever be farm and forest no matter who owns it in the future.
With a conservation easement in place, Brown can sleep in peace with the knowledge that her role as steward of the land passed down by her grandparents will be protected for future generations.
"Our DNA is literally in this soil with five generations of my family," says Brown, art illustrator, in O'Fallon, Ill., a small town 30 miles east of St. Louis. "We were raised to have a relationship with this piece of land and to see ourselves as stewards. We can no more own the land than own the breezes that blow across it."
Her story provides a window into the workings of an increasingly popular method of preserving natural open space in the United States: "conservation easements." This legal device makes good use of the dictum that says you have to give something to get something — in return for losing potential profit by preserving natural features, the landowner gets a tax break.
These easements are usually between a private landowner and a public or government agency that restricts the amount and type of development and protects the property's natural resources in perpetuity.
It's not a new concept. Thomas Tyner, regional counsel for the Northwest and Rocky Mountain region of the Trust for Public Land in Seattle, says the first conservation easement occurred in New England around the mid- to late 1800s.
But in the 1960s and '70s, interest in conservation easements grew due to increased concern with saving our natural resources, the growth in land trust organizations and tax incentives.
According Sylvia Bates, director of standards and research for the Land Trust Alliance in Canterbury, N.H., an increasing number of acres are being conserved by nonprofit land trusts (and by public agencies and state, local and national organizations) across the U.S. Between 2000 and 2005, the number of land trusts has increased 32 percent to 1,667, with the West the fastest-growing area for both acres conserved and new land trusts.
In the last five years, total acreage conserved by local, state and national land trusts doubled to 37 million acres - 16.5 times the size of Yellowstone National Park. The Conservation Biology Institute in Corvallis, Ore., hosts a national conservation easement database, and some regional efforts — like the Colorado Ownership Management and Protection Map create broader maps of all forms of land protection.
Not every property qualifies to have an easement. Land trusts look for property that holds a specific conservation benefit to society, such as a wildlife habitat, water resources, or even a scenic view or trail through the woods.
Some easements allow limited public access to the land under their control. For example, a wooded area could have a public hiking trail through it, or a farm might allow visitors to watch cows being milked or cheese being made.
In Brown's case, the natural resources being protected include the North American flyway for bird migration, upland hardwood forests, animal habitat, riparian area to the small tributaries in the Engle Creek system including wetlands for frog, reptile and amphibian habitat plus a large man-made pond that provides an essential water supply to the native wildlife.
Nuts and Bolts
After doing her homework, Brown contacted Southwestern Illinois Resource Conservation & Development, which works to preserve natural resources — like open space — and create sustainable communities in seven counties. Brown consequently placed 188 acres of the Brown family's original 380 acres into a conservation easement.
"Sally Brown was the impetus for us doing conservation easements today," says Stephen Black, land conservancy coordinator for Southwestern Illinois RC&D, Inc., in Mascoutah, Ill. "Our responsibility is that we monitor the easement forever. Each year we visit the property to make sure the restrictions Brown put in the original easement remain in place."
If there is a violation to the easement, Black's organization will take legal action to make certain the provisions are carried out. As Black puts it, "Problems don't usually happen until you have subsequent owners as the original owners are committed to the deed of trust."
His group charges a minimum of $5,000 to set an endowment fund to pay for annual monitoring plus any legal fees incurred.
The formula for a stewardship endowment is the higher the value, the higher the contribution to the fund. Landowners need to be sure they have their own legal and financial advice before they enter into any conservation easement.
Given the set-up fees that include a stewardship endowment fund, legal costs to review the easement, an appraisal, a land survey and a title search, most people won't spend money on a small piece of land since the bigger tax break goes to larger easement owners.
If your property is worth, say $1 million in today's market, once the easement is on the property, your property value has decreased. "What you've done with the easement in place is effectively given away $500,000," says Tyner.
"Any deduction that you claim as a landowner has to be verified and confirmed by an independent real estate appraiser. The conservation easement has to be granted to a 501(c) 3 nonprofit conservation group." With all the criteria met, then the value of the conservation easement is a charitable deduction.
Traditionally, only the federal government offered easement tax credits, but 16 states now offer some sort of tax benefit.
"Most people don't put land in an easement because of tax incentives anyway," Black says. "There's a desire to protect their property forever."
A conservation easement isn't an all-or-nothing arrangement. A parcel of land can be held out. Use of the property continues, but activities such as mining, logging and residential development are banned from the area in the easement.
And not all land conservation programs are forever. In California, a law known as the Williamson Act lets local governments work with agricultural landowners to restrict their property to agricultural use — usually for a rolling period of 10 years — in return for a break on their property taxes. The state reimburses the local governments some of their tax money they lose, but the state of California's huge budget shortfalls this year so reduced those repayments, it effectively suspended the 35-year-old program.
With the Williamson Act, the conservation period is designed to expire. That's not the case with most easements, but Tyner cautions, "There is a small potential to break the easement depending on what happens to the property over time. If the purpose of the easement changes, there's no longer any reason for the easement."
Perhaps the property contains a bird rookery but that species becomes extinct, and all the trees are destroyed. Then, there is no reason for the easement.
"Conservation easements have been very successful in protecting private land," says Dave Theobald, associate professor in the College of Natural Resources at Colorado State University at Fort Collins. "And, they will be fairly successful in the future although the economy has decreased the amount of money available. But the public wants this type of legal arrangements to have more accountability and more transparency. Just what value is a conservation easement protecting?"
And, Theobald says, they are not the only tools in the arsenal to save the natural land. "We need to be working in concert with other groups, organizations and thinking up new methods."
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