Conservation Opportunities for Property Owners

Ownership of a piece of property is often described as a "bundle of rights.” These rights include the right to occupy, use, lease, sell, and develop private land. The Land Conservation Brokerage (LCB) helps property owners determine if their land would be a good candidate for a conservation transaction. If a property is determined to be a good conservation candidate, a strategy is developed and implemented.

There are a multitude of actions a property owner can take to help conserve their private property while achieving their own personal financial goals. What follows are general descriptions of possible approaches to consider. A property owner should seek guidance from their personal tax advisor to determine the best approach for their particular situation.

• Sale in Fee (full or partial)
  Many property owners are interested in preserving their land but require fair market compensation. Fortunately, if property has outstanding natural or cultural values, many public agencies or non-profit conservation organizations will pay fair market value as determined by an appraisal from a reputable MAI appraiser. The appraisal must go through an extensive review process and gain approval of the respective entity. Funding for conservation transactions is available from a multitude of public and private sources; the Land Conservation Brokerage helps guide its clients through this process to close the transaction. There are no charitable deductions associated with a sale at full value; tax advantages may be available for partial donations.

• Conservation Easement
  A conservation easement is designed to exclude certain activities on private land, such as commercial development or residential subdivisions. A conservation easement involves the exchange of one or more of the “bundle of rights” from the property owner to another entity that does not own the land. A conservation easement permits the easement holder certain rights regarding the land for specified purposes, while the ownership of the land remains with the private property owner. Conservation easements can be sold or gifted to conserve natural, cultural or historic resources. Easement sales below market, or gifts, can help the proper owner achieve tax benefits.
  The easement itself is typically described in terms of the resource it is designed to protect (e.g., agricultural, forest, historic or cultural, or open space). The easement is a legally binding covenant that is publicly recorded and runs with the property deed for a specified time or in perpetuity. It gives the holder, such as a non-profit conservation organization, the responsibility to monitor and enforce the property restrictions imposed by the easement for as long as it is designed to run. An easement does not grant ownership, nor does it absolve the property owner from traditional owner responsibilities; i.e., property tax, upkeep, maintenance, or improvements.

• Retained Life Estates
  A property owner deeds their property to a public agency or qualifying non-profit and retains a life estate. The life tenant has exclusive and absolute use of the property and is entitled to the rents and absolute use of the property for his or her lifetime. Life estates give the grantors a charitable deduction while they are alive and allow them to retain the benefits of private property ownership.

• Donation of Land by Will (Bequest)
  A gift of land made through a will entitles the donor to retain full use of the land during his or her lifetime and assures that it will be cared for in the future. The Land Conservation Brokerage can help match donors with agencies or entities that will accept the bequest and preserve the land in perpetuity. The donor is responsible for real estate and income taxes for the property during his or her lifetime. Removing the land from an estate can reduce inheritance taxes.

• Gifts of Land
  Land can also be gifted to a public agency or to a non-profit conservation organization. As odd as it may seem, many organizations can be reluctant to take land in gift because of the associated liability or long-term maintenance. The Land Conservation Brokerage can help identify a public agency or non-profit organization that would be interested in a full or partial gift of your land. In exchange for a gift, the donor can receive tax benefits at the federal and/or state levels.