CONSERVATION EASEMENTS

Conservation Southeast does not write and cannot hold conservation easements. Much of this information is presented as a public service, but we are able to assist in the conservation easement process. We can evaluate your property for suitability and talk with you about your own conservation goals. We can provide a model easement document and explain its provisions, then work with you, your lawyer, and the eligible conservation organization, agency, or land trust you choose to be the holder of the easement. To the greatest extent possible, your easement will be customized to conform to your goals concerning the protection of your property. During this process, Conservation Southeast will refer you to professionals who specialize in land conservation. Once the easement is completed, the easement holder or designated third party would assume the responsibility to enforce it.

Why Should I Grant a Conservation Easement on My Land?
Although most landowners are interested in Conservation Easements because they wish to protect their family's land from future development or fragmentation, the main incentive for voluntary land conservation using a Conservation Easement is the tax benefits. A Conservation Easement lowers the value of your land by removing its development potential. The IRS treats this reduction in value as a "charitable event" or contribution to the nonprofit organization, agency, or land trust that holds the easement. For example, say your property is now worth $200,000, but with an easement in place it would be worth $120,000. That would create an $80,000 "contribution" which could be claimed against your income taxes and spread out over several years.

Who Would Hold the Conservation Easement?
You have several choices. In Alabama, the holder of a conservation easement must be a either a properly empowered governmental body (such as Alabama's "Forever Wild" land conservation program), or any of a variety of charitable corporations, associations, or trusts. Eligible groups include The Nature Conservancy, Alabama Wildlife Federation, Huntsville Land Trust, and others.

What Kinds of Properties are Eligible?
Alabama law requires that the purpose of a Conservation Easement be for maintaining land in a natural, scenic, or open-space condition, for wildlife habitat, for agricultural, recreational, or open-space use, or for conserving buildings or other aspects of historic, archaeological, paleontological, or cultural value. Thus, any property that possesses one or more of these values is potentially eligible.

Would I Be Giving Up Ownership?
No. The key feature of an easement is that the property remains in private ownership. It can be used for agriculture, silviculture, hunting, family residence, or any other use that is compatible with the conservation goals of the easement. The only uses that are restricted are those spelled out in the easement document.

Can I Sell Or Mortgage My Property?
Yes. The easement is transferred with title to the property, and is binding on subsequent owners. Lenders must be informed of the easement and must accept its provisions.

Do I Have to Allow the Public onto My Property?
No. The only access you must grant is for periodic inspection by the easement holder to be sure the terms of the easement are being met.

What Uses of the Property are Restricted?
IRS regulations and the goals of most eligible easement holders require that certain uses will always be prohibited, such as subdivision or mining (if you do not own mineral rights, you can still grant an easement so long as future mining is considered unlikely). Some activities may be compatible with the goals of an easement for one property, but not for another. For example, grazing rights would be preserved where the easement is created to preserve agricultural, open space, cultural, and recreational land, but might be excluded on another property where an easement was created to protect a rare plant community. Or, logging might be excluded where an easement is intended to protect a scenic view, but allowed on a property intended to conserve and diversify wildlife habitat.

Does an Easement Have to Cover All My Property?
No. You may wish to exclude a portion of the property. You should know, however, that protection of part of your property by easement might increase the value of adjacent, unprotected building sites.

How Long Does an Easement Last?
For tax benefits, the IRS only recognizes easements "in perpetuity," and only easements in perpetuity are accepted by most conservation organizations and land trusts. However, the term of the easement can be specified in the document. According to Alabama law, if no term is stated, the term is the lesser of 30 years or the life of the grantor, or will end upon the sale of the property by the grantor.

What Will It Cost Me?
You will need a lawyer, an appraiser, and possibly a financial advisor. Conservation Southeast can refer you to lawyers and appraisers who specialize in conservation easements. Besides legal and appraisal fees, you may be asked to make a donation to the easement holder (conservation organization or land trust) as an endowment for monitoring and enforcement of the easement on your property.

If I Am "Land Rich & Cash Poor," is There Any Other Way to Protect My Land?
In some cases, land trusts have purchased development rights. This allows cash-poor landowners to raise money from the equity in their land without selling or re-mortgaging. Usually, development rights are purchased at a so-called "bargain sale" for less than their full value. For example, if your land is worth a million dollars now and will be worth $600,000 with an easement in place, the development rights have been valued at $400,000. A land trust might purchase these rights for $200,000, creating a "donation" on your part of $200,000. Although this approach has not yet been done in Alabama, it is an option that may be worth pursuing.