conservation easement is permanently attached to the deed. After the easement is in place, CCALT’ s focus shifts to working with the landowner to see that the terms of the easement are maintained. To date, CCALT works with around 500 landowners who have established conservation easements on their property.
While a conservation easement is perpetual and legally binding, there are no limitations on heirs selling the property other than the land must be sold with the deed restrictions in place. Typically, the primary restrictions are that the property remains whole and major infrastructure is limited to certain areas described in the deed. The law says that unless it’ s impossible to continue carrying out the terms of the conservation easement, then the easement must continue to exist. The only way a conservation easement can be taken off a property is through court action.
However, a conservation easement doesn’ t protect a landowner from condemnation, such as a public utility taking a portion of the land to build or bury utility lines. Because the conservation easement is perpetual and assuming the terms prohibit any commercial development, the buyer base and value can be limited if the property is put up for sale. Indeed, that was one of the outcomes a conservation easement was supposed to create— keep a lid on inflating land prices so another ranch or farm family could buy the land at a reasonable price.
However, in areas home to desirable properties for other uses— hunting, recreation or a rural getaway— the fact that a conservation easement is attached to the deed may not be a factor in establishing the purchase price.
Originally, conservation easements had two purposes— help expand estate tax exemptions and make it more affordable for other agriculture producers to buy those properties.
“ Now, with the appreciation in land prices, a lot of ranches, even with easements on it, are selling for prices that you can’ t run an ag operation profitably,” Glenn added.
Glenn explained CCALT and its sister agriculture-focused conservation organizations are exploring other tools to layer on to conservation easements to help address the affordability gap in land prices.
“ At least provide neighbors or other landowners an opportunity to participate in that marketplace a little bit more robustly,” he said. A Path to Profitability Can implementing a conservation easement help an operation’ s profitability? Indirectly, yes it can, according to Glenn. That’ s because a conservation easement can produce a one-time cash infusion into the ranch or farm.
“ If you’ re going to design incentives for conservation, you need to be talking about cash,” he said.
The money to pay for those incentives can come from federal, state, local and even private sources. The incentives differ from state to state, he explained. For example, in Colorado, a portion of the proceeds from the state lottery are dedicated to funding conservation easements. In addition, Colorado and Virginia have a state transferable tax credit.
“ The landowner, in exchange for conveying an easement, gets a tax credit for a percentage of the value of the easement. They can use that tax credit to offset state income taxes or they can sell it to another taxpayer for cash,” Glenn said. The advantage of a transferable tax credit is that it has no geographical limitations.“ USDA and other funders typically have specific areas and things they’ re focused on, so those programs don’ t work for every producer.”
A federal tax deduction also exists, but it’ s not overly beneficial to most farm and ranch families. The Farm Bill offers several programs to help fund conservation easements and other conservation programs through its conservation title. The www. NCBA. org NATIONAL CATTLEMEN 11