- What do land trusts do?
- What exactly is a conservation easement?
- Why would a farmer or rancher agree to a conservation easement?
- Do landowners surrender any private property rights through signing a conservation easement?
- If a conservation easement is placed on a ranch, are the cattle and irrigation systems removed from the land?
- Is there a reduction in local property taxes for conservation easements?
- Why is the easement in perpetuity?
- Does the Bitter Root Land Trust own the land on an easement?
- Does a conservation easement open my land to the public?
- Can a conservation easement be put on just a portion of my land?
- What are my costs when donating a conservation easement?
- With other organizations such as The Nature Conservancy, The Montana Land Reliance, Rocky Mountain Elk Foundation and Five Valleys Land Trust active in Ravalli County, why do we need the Bitter Root Land Trust?
- I'm interested in putting a Conservation Easement on my land. What do I do next?
- How can I support the BRLT?
- I've already donated financially to the BRLT. What else can I do to help?
- If I put an easement on my land, does that take the land off the tax rolls?
- Is the Bitter Root Land Trust a government organization?
photo: Keith Fialcowitz
Q: What do land trusts do?
A: Land trusts work with private landowners to protect private land through voluntary agreements such as conservation easements. Land trusts work closely with farmers, ranchers, county government, state and federal land and wildlife management agencies and local watershed groups to protect open lands.
Land trusts and landowners work voluntarily to negotiate an agreement that protects the land from future industrial, commercial or residential development. That agreement is called a conservation easement.
Q: What exactly is a conservation easement?
A: A conservation easement is a negotiated agreement between a landowner and a land trust that essentially establishes the landowner's commitment for retaining his or her property as open lands.
In essence, a conservation agreement is a voluntary legal agreement that limits the landowner's ability to develop the land, and calls for conservation of the property's natural values.
A conservation easement is negotiated between the landowner and a land trust tailored to the unique character of the land and the conservation goals of the landowner, so easements vary in intent and purpose. But easements typically restrict these land developments: Subdivision for residential or commercial activities, dumping of toxic waste, and surface mining.
By law, conservation easements must accomplish at least one of these three conservation purposes: Preservation of open space (including farmland, ranchland and forestland), preservation of a relatively natural habitat for fish, wildlife or plants, or preservation of lands for education or outdoor recreation of the general public.
So a conservation easement is a negotiated agreement that restricts some uses of private lands, protects conservation values and retains working farmlands, ranchlands and forestlands.
The conservation agreement protects the lands in perpetuity, and the easement is recorded at the county courthouse with the county clerk and recorder.
Q: Why would a farmer or rancher agree to a conservation easement?
A: In most cases, the landowner seeks out a land trust and begins discussions about an easement. A landowner may do so for a combination of reasons.
Landowners who place easements on their property can qualify the easement as a charitable contribution and potentially be eligible for federal income tax and estate tax benefits. Remember, the easement restricts commercial, industrial and residential subdivision development of the property, so in a practical sense the land value is diminished with the easement. Since that land value is voluntarily diminished - and voluntarily diminished for conservation purposes - the landowner can receive potential tax benefits.
In August of 2006 the President signed federal legislation expanding the federal tax incentives of conservation easement donations. These new incentives allow qualifying farmers and ranchers to shelter 100 percent of their income from federal income taxes for potentially up to 16 years.
In some cases, the conservation easement is sold, rather than donated to the land trust. The end result is the same: Open lands, continuation of working farms and ranches, protection of wildlife habitat and preservation of what makes Montana such a unique and special place.
In other cases, the landowner donates or in other ways conveys an easement to a land trust for more altruistic reasons. In many cases, the landowner has such a bond with - and passion for - the land that the landowner has one simple wish: To protect the land, to keep the property whole and intact, long after the landowner and the rest of us have departed.
The only way to protect private lands in perpetuity is through a conservation easement.
Q: Do landowners surrender any private property rights through signing a conservation easement?
A: The conservation easement agreement itself spells out exactly what the landowner is "surrendering." The conservation easement will generally prevent the landowner from dumping toxic waste on the land; developing a surface mine; or allowing industrial, commercial or residential development. Some agreements restrict construction of non-agricultural structures.
Outside of that, the landowner farms or ranches in the same manner as before the conservation agreement was signed. The landowner still owns the property in fee title, the landowner still makes all the farm/ranch decisions, still pays property taxes, and because the goal of the easement is to preserve open lands, the goal of the easement is to preserve the elements of a working farm or ranch.
A conservation easement is an extension of private property rights, and is a valuable tool for farmers and ranchers who want to retain ownership of their property.
Q: If a conservation easement is placed on a ranch, are the cattle and irrigation systems removed from the land?
A: No. In fact, the opposite is true. A typical conservation easement not only allows - it encourages - the property be used for agricultural production, grazing and timber harvesting. In most conservation easements, landowners do not have to modify their management activities.
Q: Why is the easement in perpetuity?
A: Three main reasons. One, current landowners who grant or otherwise convey a conservation easement want assurances their property will be protected not just through their lifetime, but for generations to come. Two, federal law requires the conservation easement be held in perpetuity to qualify for federal income tax and estate tax benefits. Three, there is a concern that if conservation easements granted tax deductions and were allowed for terms - say, 20 years or 100 years - landowners could be tempted to receive the federal tax deductions for decades while speculating on lands that are rising in value, then subdivide that same property later after the term of the conservation easement expires.
Also, there are many land use decisions - on both private and public lands - that are made on a regular basis that in essence are made in perpetuity. When a county planning board and county commission vote to allow a 50-lot subdivision, and the land fills with 50 homes, there is no doubt that land will be in residential/commercial/industrial use in perpetuity.
Q: Does the Bitter Root Land Trust own the land on an easement?
A: No. A conservation easement does not change the property ownership of a piece of land. The landowner still owns the land under the easement. The easement simply ensures that the restricted acreage under the easement will not be used for specified purposes (e.g., development, subdivision, etc.). The Bitter Root Land Trust provides trained staff to help landowners (and future landowners) care effectively for the land under an easement and to ensure that the provisions of the easement are being met.
Q: Can a conservation easement be put on just a portion of my land?
A: Easements are flexible and can be tailored to each piece of land according to the wishes of the landowner. It is possible to reserve the right to build a few homes or develop part of your land by stipulating these exceptions in the easement document. It is up to the land trust to decide if these exceptions will still meet its criteria for accepting the easement.
Q: What are my costs when donating a conservation easement?
A: Conservation easements are legal documents and require the professional services of lawyers, accountants and appraisers to prepare them properly. Some of these costs are borne by the land trust, and some by the landowner. In addition, there are costs associated with the annual stewardship review required under the terms of most conservation easements. Since this review must go on in perpetuity, a stewardship donation is usually created for each easement. Landowners are asked to donate to this fund and are usually happy to do so, even if they have not received substantial tax benefits from the donation of the easement. Such donations usually range from $5,000 to $15,000. If the landowner cannot make such a donation, the land trust might fundraise the amount from local sources, or extended payments or alternatives to cash can be considered. Some of the costs incurred in making a charitable contribution are themselves deductible. Often the income and/or estate taxes saved through the donation of a conservation easement make up for the out-of-pocket expenses incurred by the landowner. Moreover, the Bitter Root Land Trust is aggressively pursuing grants and contributions to help defray some of the costs of donating easements for qualified landowners.
Q: With other organizations such as The Nature Conservancy, The Montana Land Reliance, Rocky Mountain Elk Foundation and Five Valleys Land Trust active in Ravalli County, why do we need the Bitter Root Land Trust?
A: Today there are over 1,200 local land trusts active in communities throughout the United States. A local land trust can tailor its assistance to the special needs of each community, since the board members and staff are local, knowledgeable and respected citizens of that community. As long as a landowner doesn't wait until too late in the year to start the process, a local land trust can speed up the process of assisting landowners who wish to put easements in place, especially when time is of the essence. Moreover, local landowners are quicker to build a bond of trust with a local organization with board members who have been long-time neighbors.
In addition, many national and regional land trusts have missions that do not encompass all the land conservation needs in a community. The Land Reliance has a mission to preserve productive agricultural land, The Nature Conservancy to preserve endangered species habitat, and the Rocky Mountain Elk Foundation to protect elk corridors and winter range. The smaller property that may be the home to a variety of wildlife, the scenic view, the strategic riparian area or wetland, the remaining neighborhood open space, the public access, all need the attention of a local land trust if they are to be protected.
Finally, land trusts are very busy organizations and cannot be everywhere at once. Those mentioned above strongly encouraged the BRLT to move ahead to help with our collective goals. We plan to cooperate closely with all land trusts active in Ravalli County. We will refer landowners to these organizations when appropriate, and they will do the same for us. We will share information and use some of the same consultants. For the benefit of the public, the majority of conservation easement documents designate a backup easement holder if for some reason an existing trust cannot honor its obligations in perpetuity.
Only the Bitter Root Land Trust, however, will be proactive in reaching out to Bitterroot Valley landowners and their representatives in the real estate, tax, and financial services professions. For this, there is no substitute for a local presence.
Q: I'm interested in putting a Conservation Easement on my land. What do I do next?
A: Your first step should be to call the Bitter Root Land Trust office and let us know of your interest. A member of our Lands Committee will meet with you to gain an understanding of the conservation objectives you have for your property, its physical characteristics, adjacent land uses, existing covenants or zoning restrictions, and the ownership status (underlying contract holder, outstanding liens, etc.) and describe how easements work and the steps needed to complete an easement. The Lands Committee then will evaluate the conservation value of the property using a list of criteria based on our mission and goals. If the Committee finds that there is significant benefit to the public (not to imply public access) from protection of your land and that the Trust can insure this protection over the long term, it will recommend the project to the entire Board of Directors for preliminary approval. This step helps direct our limited time and resources to the most worthwhile projects. Now the negotiations can begin on the terms of the easement. Each one will be different given the unique character of the land and each owner's intentions, but we will start with a model based on the experience of hundreds of long-established land trusts across the country. We and the landowner also will start other steps in the process including a title search, a baseline study, and an appraisal if the owner is interested in a tax deduction. In order to safeguard the funds which have been donated to the Bitter Root Land Trust, we generally request a deposit of half the anticipated upfront expenses at the time we undertake making expenditures from the Land Trust's monies. The landowner will seek direction from such professionals as an accountant and an attorney to ensure that the landowner's interests are being served. The Trust and the landowner begin negotiating the terms of the conservation easement and related documents; when both the Trust and the landowner are comfortable with the terms of the easement, the easement will be signed by the owner, accepted by the Board of the Trust, and recorded in the Courthouse. All future owners of the property will be bound by the easement, and the Trust will assume its perpetual obligation to enforce the provisions of the easement. Although a landowner invests considerable time and some expense in granting a conservation easement, most easement donors have found great satisfaction in knowing they have protected their land in perpetuity.
Q: How can I support the BRLT?
A: While we apply for and receive grants from private foundations, the Bitter Root Land Trust is primarily supported by donations from citizens community members supporting our mission to conserve natural areas, agricultural lands, wildlife habitat and scenic open space in and around the Bitterroot Valley.
Q: I've already donated financially to the BRLT. What else can I do to help?
A: You can: Volunteer for fundraising events, to serve on committees, or help out in the office. Talk about us with friends and neighbors.
Pass on information about conservation easements to landowners you think might be interested; refer them to us if you're not sure you can adequately explain the process.
Let us know of someone we should contact about donating an easement of funds.
Q: If I put an easement on my land, does that take the land off the tax rolls?
A: Conservation easements do not necessarily change the County assessment of property tax. The County assessor decides on the assessment level for each property.
Q: Is the Bitter Root Land Trust a government organization?
A: No. The Bitter Root Land Trust is a private, nonprofit organization with 501(c)3 status. We have no official connection with The Nature Conservancy or any other national environmental group. We are locally staffed and all of our board members own land in the Bitterroot Valley and live here. We have over 750 members who support our programs. We do occasionally work with government agencies, like the United States Forest Service, Montana Fish Wildlife & Parks (MFWP), and Ravalli County.