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For more information about conservation easements, or if you have land you would like to place a conservation easement on, please call us at (520) 577-8564.  We look forward to hearing from you!

 

Contents of this page:
What Are Conservation Easements?
What Kind of Property Can Be Protected by an Easement?
Who Can Grant and Easement and To Whom Can They Grant It?
How Restrictive Is An Easement?
How Long Does an Easement Last?
What Are The Grantee’s Responsibilities?
Must an Easement Allow Public Access?
Tax Policy for Land Conservation
What is Monitoring and Why We Do It
Endowments

 

What Are Conservation Easements?
A conservation easement is a legal agreement a property owner makes to restrict the type and amount of development that may take place on his or her property.  Each easement’s restrictions are tailored to the particular property and to the interests of the individual owner.  The easement has the effect of limiting real estate development while allowing certain current uses such as farming and ranching to continue.  The easement is generally put in place to protect some important conservation value of the land such as wildlife habitat. 

To understand the easement concept think of owning land as holding a bundle of rights or sticks.  A landowner may sell or give away the whole bundle, or just one or two of those rights.  These rights may include the development rights, the grazing rights, the water rights, the mineral rights or timber rights.  To give away certain rights while retaining others is like pulling a single stick out of the bundle.  To give away certain rights while retaining others, a property owner grants an easement to an appropriate third party.

The specific rights a property owner forgoes when granting a conservation easement are detail in each easement document.  The owner and the prospective easement holder identify the rights and restrictions on use that are necessary to protect the property.  The owner then conveys the right to enforce those restrictions to a qualified conservation recipient, such as a public agency, a land trust, or a historic preservation organization.

What Kind of Property Can Be Protected by an Easement?
Any property with significant conservation or historic preservation values can be protected by an easement.  This includes forests, wetlands, farms and ranches, endangered species habitat, beaches, scenic areas, historic areas, and more.  Land conservation and historic preservation professionals can help you evaluate the relative features of your property.

Who Can Grant and Easement and To Whom Can They Grant It?
Any owner of property with conservation or historic resources may grant an easement.  If the property belongs to more than one person, all owners must consent to granting an easement.  If the property is mortgaged, the owner must obtain an agreement from the lender to subordinate its interest to those of the easement holder so that the easement cannot be extinguished in the event of foreclosure.

If an easement donor wishes to claim tax benefits for the gift, he or she must donate it or sell it for less than fair market value to a public agency or to a conservation or historic preservation organization that qualifies as a public charity under Internal Revenue Code Section 501(c) (3).  Most land trusts and historic preservation organizations meet this criterion.

Holding an easement is a great responsibility.  A property owner should make sure that the recipient organization has the time and resources to carry out that responsibility.  An organization that accepts the donation of an easement typically will ask the owner to make a contribution toward the costs of monitoring the easement in perpetuity or will establish a monitoring fund from other sources.

How Restrictive Is An Easement?
An easement restricts development to the degree that is necessary to protect the significant values of that particular property.  Sometimes this totally prohibits construction, sometimes it does not.

If the goal is to preserve a pristine natural area, for example, an easement may prohibit all construction, as well as activities that would alter the land’s present natural condition.  If the goal is to protect farm or ranch land, however, an easement may restrict subdivision and development while allowing for structures and activities necessary for, and compatible with, the agricultural operation.  Even the most restrictive easements often permit landowners to continue traditional uses of the land.

How Long Does an Easement Last?
An easement can be written so that it lasts forever.  This is known as a perpetual easement.  Where state law allows, an easement may be written for a specified period of years, and this is known as a term easement.  Only gifts of perpetual easements can qualify a donor for income and estate tax benefits.  Most recipient conservation and historic preservation organizations accept only perpetual easements. 

An easement runs with the land.  The original owner and all subsequent owners are bound by the restrictions of the easement.  The easement is recorded at the county or town records office so that all future owners and lenders will learn about the restrictions when they obtain title reports.

What Are The Grantee’s Responsibilities?
The grantee organization or agency is responsible for enforcing the restrictions that the easement document spells out.  To do this, the grantee monitors the property on a regular basis, typically once a year.  Grantee representatives visit the restricted property, usually accompanied by the owner.  They determine whether the property remains in the condition prescribed in the easement and documented at the time of the grant.  The grantee maintains written records of the monitoring visits.  The visits also keep the grantee and the property owner in touch. 
If a monitoring visit reveals that the easement has been violated, the grantee has the right to require the owner to correct the violation and restore the property to its condition prior to the violation.

Must an Easement Allow Public Access?
Landowners who grant conservation easements make their own choice about whether to open their property to the public.  Some landowners convey certain public access rights, such as allowing fishing or hiking in specified locations.  Others do not.

If an income tax deduction is to be claimed, however, some types of easements require access.  If the easement is given for recreation or educational purposes public access is required.  Access is generally not required for easements that protect wildlife or plant habitats or agricultural lands.

Tax Policy for Land Conservation
One of the most effective ways we can increase the pace of land conservation, is through Federal and State tax incentives that help land owners choose conservation over development. In the last few decades, land trusts have been enormously successful in using these incentives to protect special places across America.

Thanks to the hard work of the land conservation community, Congress enacted and recently renewed a tax incentive that allows conservation easement donors to deduct a larger portion of their income over a longer period of time. While we continue to work to make these expanded incentives permanent, we're also working to build awareness among donors, attorneys, and tax advisors to make the most of this incentive over the next several years.

Congress has recognized the enormous value of our work with expanded incentives, but the IRS expects easement donors and land trusts to adhere to a high standard of compliance. Of course, there's no substitute for professional tax and legal advice, but the LTA website helps provide important guidance. (www.lta.org)

What is Monitoring and Why We Do I
When ALWT accepts a conservation easement, we commit ourselves to perpetual stewardship of the easement land. This means that we have an ongoing obligation to regularly monitor the easement and enforce the easement terms if they are violated.

The completion of each conservation easement project involves mapping and careful documentation of the character of the land and its special conservation values. This "baseline documentation" provides a starting point for ALWT staff and volunteers to annually monitor the terms of the easement. During the monitoring, ALWT takes photos from established monitoring photo points to document the condition of the ranch. In addition, we complete a written checklist of the observations of the property.

Each monitoring visit provides us with an opportunity to maintain and develop a stringer relationship with the owner and build a spirit of education and cooperation. A monitoring visit reinforces the partnership between the owner and the Arizona Land and Water Trust to uphold the terms of the easement. While all easement properties are still owned by the original landowner, at some point in the future, the property may be transferred to new owners. These personal visits give the landowner names and faces to accompany the legal terms of the deed, and also provide the landowner with ready access to someone who can answer questions about the easement. Ultimately, our goal is to prevent violations and foster a spirit of partnership,

Endowments
Land trusts must determine the long-term stewardship and enforcement expense of each conservation easement and secure the dedicated funds to cover current and future expenses. A contribution to a restricted endowment fund is usually part of the early negotiation between a land trust and the grantor. Typically the size of this request is based on the size of your easement (and therefore the time required to monitor it.)

 

Sources:
“Preserving Family Lands:  Books I and II”, Stephen J. Small, 1998, 2000, 2003
“The Conservation Easement in California”, Thomas S. Barrett, 1983

For more information about conservation easements, or if you have land you would like to place a conservation easement on, please call us at (520) 577-8564.  We look forward to hearing from you!