Conservation Article 1/9/03 3:14 PM Page 1 Co Part One nservation Easements by William M. Silberstein, Esq. and Melinda Beck, Esq. Preservation of land for the use and benefit of future gen- forests, open space, agricultural lands, scenic vistas, or erations as well as for the protection of wildlife and plant historic structures. species has typically been viewed as the responsibility of gov- The document is signed by the grantor and grantee, is ernment. Historically, such preservation has been accom- recorded in the county real estate records, and restricts title to plished through the establishment of federal, state and local the land it encumbers. A conservation easement is usually a parks and open space areas. permanent restriction on the land that automatically binds not The continuing growth, however, of urban and suburban only the grantor, who is the current owner of the land, but also areas along with development of farmland and other undevel- any future owners of the land. oped land has increased the need for preservation of land. The grantee of a conservation easement can be a qualified Competition for government funding for such preservation private organization, such as a land trust, or a government remains fierce. There is a sense of urgency on the part of those entity, such as a county, city, state or federal agency or other committed to preservation that land available now may not be quasi-governmental entities. The grantee has responsibility for available later. enforcing the use restrictions contained in a conservation ease- A few dedicated conservationists seeking private methods ment, and will periodically inspect the property to verify com- to accomplish the preservation of land have created a legal pliance with the terms of the conservation easement. instrument known as a conservation easement. This unique instrument permits a landowner to retain ownership and limit- Restrictions ed use of the land while ensuring its preservation in perpetuity. The conservation values of each parcel of land are unique. The land to be preserved does not need to be purchased by the Each easement must be individually drafted to reflect both the government, thus saving limited public resources. Many private specific conservation values and the goals and desires of the organizations, primarily land trusts, have embraced the conser- landowner. There are, however, certain activities that most con- vation easement to preserve land. servation easements uniformly prohibit. These include surface mining, industrial uses, non-agricultural commercial uses, con- Structure struction of buildings and homes (unless otherwise reserved in A conservation easement is a legal document that contains one or more home sites) and other similar uses which by their permanent restrictions on the use or development of land. nature would not protect the conservation values. In essence, it is a voluntary contract entered into between a Conservation easements on working lands such as farms, landowner (the grantor), and a land trust or a government ranches, and forests have special provisions designed to perpetu- entity (the grantee), for the purpose of preserving certain ate traditional uses of the land while preserving natural values. values of the property. These values include wildlife habitat, 1 FACTS & FINDINGS / DECEMBER 2002 National Association of Legal Assistants. www.nala.org Conservation Article 1/9/03 3:14 PM Page 2 Land Owner Motivation and fauna, such as the Nature Conservancy, Rocky Mountain A land owner may have a number of motives for granting Elk Foundation, and Ducks Unlimited. a conservation easement. The most noble motivation is a Land trusts can also be created by local open space and desire to ensure that the land is forever preserved and protected nature preservation associations. In these local organizations, the from development. There are also significant tax benefits which members of the board of directors of the land trust are typically may be derived from conservation easements, including federal members of the community in which the land trust operates. and state charitable income tax deductions, state income tax Many land trusts have a specialty or focus on a particular use credits, federal and state estate tax deductions and exclusions of the land, such as ranching or agriculture, or on the protection (including post-mortem elections), and real property tax relief. of a specific type of wildlife or plant habitat. These specialized (These tax benefits will be explored in Part 2 of this article in a land trusts often include board members with expert knowledge future issue of Facts & Findings.) regarding the specialty of the land trust. These trusts can provide Another common motivation for a landowner's grant of a education to landowners as to the latest techniques and methods conservation easement can arise in situations where farming or available to protect the conservation values of their land. ranching activities on the land do not produce enough income The Land Trust Alliance (LTA) is the trade organization for to pay for property taxes and upkeep. Many landowners who land trusts, based in Washington, D.C. The LTA (www.lta.org) would otherwise like to preserve their land are forced to sell to publishes many excellent books, videos and a newsletter, and avoid continuing losses. holds regional seminars, workshops, and an annual educational In addition, the heirs of deceased landowners may be convention in different areas of the United States. forced to sell their inherited land to pay estate taxes. Under these scenarios, a conservation easement can permit such Legislation landowners to preserve their land by providing estate and prop- Although conservation easements have become a popular erty tax relief when a conservation easement is donated. Some land preservation tool, the legal structure of a conservation conservation organizations and governmental entities will buy easement is unique. In other typical easements (e.g., an access a conservation easement from a landowner thereby infusing the easement), the easement burdens one parcel of land (the land landowner with funds to pay taxes and to continue or even crossed by the access easement) for the benefit of an adjacent expand farming or ranching operations. parcel of land (the destination of the access easement). Another method to provide a landowner with funds or A conservation easement, on the other hand, does not pro- flexibility while still preserving the land is to permit the vide a benefit to an adjacent parcel of land but confers a respon- landowner to reserve home sites. A landowner may reserve the sibility upon an entity or an individual to enforce use restrictions right for a certain number of sites that can each be developed on the land. Therefore, the conservation easement is a negative into a single-family residence and sold or kept by the landown- easement in gross and is disfavored by the common law. er to pass on to family members. These home sites would Without common law support, conservation easements remain restricted by the conservation easement in order to have become primarily creatures of statute. Nearly all states minimize the effect of such development on the conservation except Wyoming and Pennsylvania have adopted enabling acts values of the land. which recognize conservation easements as a real property The number of sites the landowner can reserve will depend interest, with the full weight of statutory authority. Absent this upon various factors particular to each easement, including the statutory authority in Wyoming and Pennsylvania, valid con- size of the easement and the proposed location of the sites in servation easements are granted in practice by the landowner relation to the conservation values to be protected. Usually these conveying an acre of land to the grantee and making the con- sites are identified in the conservation easement to avoid location servation easement for the benefit of the acre of land. in important wildlife habitat and to protect scenic views. Despite the lack of common law support, all states have author- ity or mechanisms in place to grant valid conservation easements. Land Trusts The most common grantees of conservation easements are Conclusion land trusts, which are typically private, non-profit corpora- The popularity of conservation easements will continue to tions. There are a variety of land trusts, including national increase for all the reasons presented as well as for the signifi- organizations, which are dedicated to the preservation of flora cant tax benefits to be described in Part II. Given that the gov- continued on page 3 FACTS & FINDINGS / DECEMBER 2002 National Association of Legal Assistants. www.nala.org 22 Conservation Article 1/9/03 3:14 PM Page 3 Part One: Conservation Easements continued from page 2 ernment has limited funds to single-handedly preserve all lands Federation and served as case note editor for the Law Review. worthy of protection, conservation easements remain the most Melinda Beck is a member effective private tool to preserve land for future generations. of the Isaacson, Rosenbaum, Woods & Levy Real Estate and Bill Silberstein is head of the Transactional Practice Group, Conservation Easement Practice the Public law and Policy Practice Group at the Denver, CO law Group, and the Conservation firm of Isaacson, Rosenbaum, Practice Group. She was formerly Woods & Levy. He is recognized an assistant county attorney with as a leader in land conservation a wide spectrum of duties, law and has served as counsel to including matters pertaining to Colorado Open lands, Colorado land acquisition and management Cattlemen's Agricultural Land by the Douglas County Trust, Great Outdoors Colorado, Department of Open Space Aspen Valley land Trust, and and Natural Resources. Colorado Coalition of Land Ms. Beck gave a presentation on "Land Use Litigation..." Trusts. He has represented many before the 1999 Rocky Mountain Land Use Institute Annual landowners and other local and national land conservation organ- Conference, and presented "Considerations Affecting the izations in preserving tens of thousands of acres of Colorado land. Development of Water Projects" at the 2002 Colorado Water Law He is a frequent speaker on conservation easements and the tax Conference. She has a BA in Economics from Pomona College, aspects of open space preservation. CA, and a JD from the University of Denver. He holds BA and JD degrees from the University of Colorado, where he served as an intern with the National Wildlife 3 FACTS & FINDINGS / DECEMBER 2002 National Association of Legal Assistants. www.nala.org