Conservation Easements: Protecting Land for the Future

What Is Conservation Zone?

Research has shown that people value living in conservation areas and are willing to pay more for property located within them. However, there are a number of factors that must be considered before deciding to move into an area designated as such.

Communities can take proactive measures to conserve natural resources through processes like a Natural Resource Inventory (NRI) and open space planning. One approach is to establish a primary zoning district that regulates development in an environmentally sensitive area with specific standards.

What is a Conservation Easement?

A conservation easement is a voluntary agreement between a landowner and a nonprofit conservation organization or government agency. The easement restricts the property’s development potential while preserving its natural or scenic values. It applies to present and future owners of the land.

The conservation easement’s goals and terms are tailored to the property and the goals of the landowner and the conservation organization. Typically, the conservation easement allows sustainable forestry and limits construction. It also may provide for a stewardship fund to ensure that the conservation easement’s objectives are respected in perpetuity.

In most cases, a conservation easement can be donated or sold at fair market value. If the donation or bargain sale meets IRS requirements, the landowner can receive a federal tax deduction. Because the conservation easement reduces a property’s development potential, it may also lower the property’s tax assessment. However, the amount of the reduction depends on local tax assessors’ perception of the demand for municipal services on undeveloped land.

What is a Conservation Easement Permit?

A conservation easement is the most common and flexible way for a landowner to permanently protect their land. It preserves your property’s special features, while allowing you to retain private ownership and use of the land. Typically, it restricts the property to agricultural and open space uses and prohibits or limits commercial development and activities that would diminish the property’s conservation values.

The landowner retains the right to sell or mortgage the property, but the restrictions on the property “run with” the land and apply to any future owners. Genesee Land Trust monitors the property to ensure compliance with the easement’s terms and takes legal action, if needed, to protect its integrity.

Subject to advance approval by Grantee, trails, paths, small wooden bridges and erosion control measures that are traditionally related to hiking, walking, bicycling (non-motorized) or snowshoeing may be constructed on the Protected Property, if they are consistent with the Purpose and Conservation Values of the Conservation Easement.

What is a Conservation Easement Approval?

Rather than giving up all of their property rights, owners voluntarily place restrictions on development that are binding in perpetuity. The easement’s overarching conservation objectives and administrative terms are tailored to the specific land, the goals of the landowner and the conservation agency, and can include everything from supporting sustainable forestry and agriculture to forbidding subdivision.

Most conservation easements are donated or sold at a bargain price (below the fair market value) to public or private conservation agencies to qualify for a federal income tax deduction. Because of this, the appraised value of a conservation easement is based on how much it restricts future development and how restrictive the easement is compared to the land’s potential economic use.

By lowering the land’s future development potential, a conservation easement can significantly lower its estate taxes when passed to the next generation. However, each state has its own rules governing how to obtain the estate tax credit and it’s important to consult with an attorney to ensure that your state’s regulations are met.

What is a Conservation Easement Permit Approval?

The Deed of Conservation Easement outlines the restrictions that are placed on the land. It also names the organization (referred to as the grantee in the deed) that will monitor and enforce the easement on a regular basis. Many easements also name another entity as a backup enforcer in case the original donee organization is unable to ensure compliance with the easement’s terms.

The purpose and restrictions of each conservation easement are tailored to the unique characteristics of a property. Some restrict all future development, while others allow limited new construction. Most allow traditional agricultural and forestry uses to continue.

Research shows that people value living in places where natural and cultural resources are conserved. This is reflected in the price that buyers pay for properties located in conservation areas. Conservation easements can also reduce a property’s tax assessment, but that decision is up to the local assessor. Whether the reduced assessment is a positive or negative impact on a property depends on how the easement affects the land’s overall value and how it affects surrounding properties.

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