Buying property is never easy, and buying land with public dollars for conservation or recreational purposes is even more difficult. But knowing what to look out for and planning ahead will help make the process go more smoothly and avoid last minute delays that can be frustrating and costly. While the requirements for acquisition grants are available on the Department of Conservation and Natural Resources (DCNR) web site, PALTA recently asked staff at the department to identify a few of the more common issues facing land trusts and municipalities in applying for acquisition grant dollars. So here they are:

Who has title to the property?

Every acquisition project starts by gathering the facts on the property. The buyer of the property needs to know the current owner of the land and what encumbrances and restrictions come with the property. Identify who owns oil and gas rights under the property and whether the mineral rights have been reserved, which has become more important with the recent Marcellus drilling boom.

DCNR grant criteria give preference to unencumbered properties. This is true even if the reservations on the property are for conservation or recreational purposes. A title report can be particularly helpful in aiding appraisers in assessing the value of a property. There are some caveats. Generally, title work and title insurance generally will only look back 60 years. It is not uncommon for the title companies to except out O&G and mineral rights.

What are the boundaries of the property?

This is another critical step in the information gathering process. It is good practice to have a boundary survey plan to confirm the property corners, the acreage, any encroachments and other features. DCNR grant applicants are required to have a sealed boundary survey prepared by a registered surveyor. In certain occasions, DCNR may recommend that the boundary survey be recorded in order to notify the pubic of restrictions on the use and development of the property.

What are the requirements for appraisals?

The fair market value of a property is also critical information in any land acquisition project. When public dollars are involved, how the applicant determines the value of the property is important to maintain confidence in the process. DCNR requires the grant applicant to commission a self-contained appraisal report by a general real estate appraiser at the time of application to justify the amount of the grant request and a second appraisal generally less than one year prior to the date of settlement.

The department will reimburse up to 50% of the approved market value estimate for the property or easement (based on two appraisals) or the actual purchase price, whichever is less and other allowable costs which include the cost of the appraisals. DCNR grantees should make sure that they have an agreed upon reimbursement value before closing to avoid any last minute questions.

Finally, is the project ready to go?

Again, this is an issue common to all land acquisitions whether grant-funded or not. DCNR has developed a ready-to-go checklist for grantees that details some of the common issues to consider when using public dollars. This check list can be accessed on line at dcnr.state.pa.us/brc/grants.

Discuss with DCNR

Call your DCNR Regional adviser or other DCNR grant managers to discuss your project and how you can strengthen your application. A few minutes online or on the phone may save hours of problem solving later in the transaction!