Conservation

Conservation Easements

Conservation Easements – What Are They?

Buying land for conservation purposes, whether to protect natural, scenic or agricultural values, can be an expensive undertaking for land trusts. As an alternative to buying land, land trusts are increasingly using the conservation easement as a land protection tool. When landowners either donate or sell a conservation easement on their land, they are essentially giving up their commercial development rights to the land while retaining ownership of the land, benefiting from the donation or sale of the land through a combination of income from the sale, decreased property taxes, tax deductions, and the knowledge that they are protecting the natural, scenic or agricultural integrity of their land in perpetuity.

Protecting Land with Conservation Easements: Answers to Frequently Asked Questions

What is a Conservation Easement?

A conservation easement is a voluntary and legal land protection agreement between a landowner and a land trust that protects the natural, scenic, agricultural and/or historic integrity of the land. For example, by donating or selling an agricultural conservation easement to a land trust, landowners enter into an agreement that limits the uses of their land to farming and ranching activities while retaining ownership of the land and the right to continue farming and ranching as they always have. Since conservation easements restrict commercial development land, property taxes on the land decrease. The purchase price for the easement negotiated between the landowner and land trust is based on the difference between the appraised fair market value and the restricted value of the land. If the easement is conveyed as a donation or a bargain sale, the landowner is eligible for significant tax deductions. A qualified land appraiser must perform valuation.

Valuation Example:

What constitutes a conservation easement agreement?

Through negotiating the terms of the easement agreement, the parties agree upon

• maintenance of current structures and improvements and, in some cases, accommodation for future construction.
• use of land areas adjacent to rivers, streams and lakes
• monitoring and enforcement of the easement
• easement stewardship endowment
• other provisions that fit the needs of the landowner and the conservation objectives of the land trust.

What are the financial advantages to selling or donating a conservation easement?

Landowners can use the income earned through the sale of a conservation easement to improve or increase their farming operations, pay off a loan, or contribute toward retirement savings. Because an easement lowers the fair market value of a property by restricting its development potential, selling or donating an easement on the property likewise lowers estate taxes. In the case of a donation, the landowner may deduct the value of the donated easement from his or her income taxes just as for any other charitable contribution.

Does an agricultural conservation easement give the public access to the land?

No. The property remains protected from public entry as would any other private land, unless the landowner specifically allows for the right of public access. The San Joaquin River Parkway and Conservation Trust’s interest in providing public access varies by location of the property and we are pleased to meet and discuss this option with you.

Can land restricted by a conservation easement be given away or sold?

Yes. Since landowners retain ownership of their land, they retain the right to sell the land or pass it on to heirs. However, the long-term protection of the property is guaranteed because the terms of the easement are perpetually binding on all future owners.

On what portion of my land would an agricultural conservation easement be placed?

The San Joaquin River Parkway and Conservation Trust prefers to protect the entire farm or ranch. However, in some cases the landowner may exclude portions of the property for future house lots for family members or as a financial contingency. Under this circumstance, the landowner and the San Joaquin River Parkway and Conservation Trust jointly determine the location and description of these areas.

Do I need a title report for my property?

Yes, the landowner must obtain an updated title report, preferably early in the process to avoid delays later.

What responsibility does the San Joaquin River Parkway and Conservation Trust have as the holder of a conservation easement?

To monitor and enforce the restrictions as set forth in the easement agreement.