Conservation easements: fact and fiction

By Timothy Lindstrom

Recent encounters with several candidates for local office surprised me with the candidates’ lack of understanding of conservation easements. It wasn’t that these candidates didn’t know what conservation easements were; it was that their knowledge appeared based more in fiction than fact.

Because conservation easements play an important role in maintaining Rappahannock County’s rural character, and because it is likely many local residents share the candidates’ misunderstandings, the following is offered as a factual response to some of the fictional issues regarding conservation easements.  

Fiction #1: Conservation easements prohibit future agricultural use.

Fact: Conservation easements almost always allow agricultural use such as crop farming, livestock production, orchards, vineyards, along with timbering, hunting, fishing, and even limited residential use and subdivision (although at very low densities only).

A landowner whose land is subject to a conservation easement may choose to convert hayfields to native grasses and hire a full time conservationist to return the land to a natural, uncultivated condition. However, that is the landowner’s choice, not a requirement of the conservation easement.

Fiction #2: Conservation easements undermine the agricultural economy.

Fact: This fiction is very akin to fiction #1. In fact, because conservation easements typically insure that land must remain available for agricultural use and typically prohibit development, they support the agricultural economy.

By eliminating or significantly reducing the development value of land conservation easements insure that real estate taxes will remain low. By eliminating development potential conservation easements also reduce interference with farming that occurs when subdivisions begin to surround farmland.

Fiction #3: Rich people are buying land, putting conservation easements on it, and thereby taking it out of agricultural use.

Fact: Most “rich people” who buy land and conserve it are not farmers. However, they want their land maintained. To do so, they make it available to local farmers at little or no cost in exchange for the farmer maintaining the land. This allows local farmers to substantially expand their operations at little additional cost, further supporting the local agricultural economy.

Fiction #4: Conservation easements are a bad idea for small farmers because they deprive small farmers of future income from development.

Fact: It is true that conservation easements preclude substantial future development value. However, in Virginia conservation easement donors are eligible for income tax credits that can be sold to other taxpayers. Tax credits equal 40% of the value of the conservation easement. Farmers selling tax credits typically net about 80 cents on the dollar. So a small farmer who contributes a conservation easement worth, say, $500,000 is entitled to tax credits equal to $200,000 from the sale, of which he or she could expect to net $160,000.  

While $160,000 is far less than the farmer might get from selling the development rights on the farm, the conservation easement allows the farmer to keep the farm intact. Depending upon acreage a small farmer may also retain some rights to sell off lots which can also generate future income.

However, no one who ultimately wants to cash in on the development value of his or her land should grant a conservation easement.

Fiction #5: Conservation easements deny future owners their property rights to subdivide.

Fact: No one has a “property right” to subdivide land if that right didn’t exist when the land was bought: you get only what you pay for. Furthermore, no one is forced to buy land subject to a conservation easement. If a buyer wants land that can be subdivided there is plenty of that land available. Conservation easements are a matter of public record in the Clerk’s Office like all other land title matters so no one can buy land subject to a conservation easement and not know about it.

Fiction #6: Conservation easements open the land to government ownership or public access.

Fact: The government obtains no rights conservation easements or to the easement land unless the conservation easement is granted to a government agency. There are many private “land trusts” that accept and hold conservation easements and these easements remain private property.

Even if a conservation easement is granted to a governmental agency, such as the Virginia Outdoors Foundation, the agency obtains only the rights expressly granted by the easement donor. To obtain any additional rights a governmental agency would have to exercise the power of eminent domain, just as would be the case with any other private property.

Furthermore, unless the easement expressly allows public access (which most do not), the public gains no rights to use the land that is subject to the easement. On the other hand, a landowner may expressly provide for public access to the land if he or she so chooses.

Fiction #7: Conservation easements should terminate when the land changes hands.

Fact: First, in order to be eligible for any tax benefits, including state and federal tax deductions and Virginia tax credits, conservation easements must be permanent. Second, there would be no reason for a landowner to grant a conservation easement if it terminated when he conveyed title to the land. A landowner can choose not to develop during his or her ownership without the need for a conservation easement.

Fiction #8: Landowners should not have the right to permanently dictate how land is used in the future by granting conservation easements.

Fact: The right to conserve land is as much a property right as is the right to develop land. Furthermore, landowners permanently dictate how land is used in the future when they create subdivisions, shopping centers, or townhouses. Land is forever tied up by such developments in a manner that cannot practically be reversed. On the other hand, if there is no longer a conservation purpose to be served by a conservation easement it can be terminated by a court.

Fiction #9: Conservation easements undermine the County’s tax base by keeping land values low.

Fact: First, most land placed under conservation easement is already in the County’s “use value” program and is enjoying taxes at agricultural or open-space rates before the easement is granted. Second, it is well established that residential land costs more for services, particularly education, than it generates in tax revenues; as has been said many times: “Cows don’t ride school buses.”

Fiction #10: A conservation easement puts future control of land in the hands of the land trust or agency that holds the easement.

Fact: Land trusts or government agencies that hold conservation easements have the right to enforce the restrictions imposed by a conservation easement; however, the restrictions are only those that the landowner granting the easement has approved. The land trust or agency has no right to use the easement land and its only right to actually physically come on the land is for periodic (typically no more than once a year) monitoring to make sure that the land is being used consistently with the easement. If there is a violation of the easement the land trust or agency has a right to bring a lawsuit to obtain compliance.

If a landowner does not want to be restricted in his or her future use of the land or does not want to be subjected to monitoring of his or her future use of the land, they should not grant a conservation easement on their land.

Fiction #11: Conservation easements eliminate most all of the value of the land.

Fact: Conservation easements do, in fact, reduce future land values because they eliminate some or all future development potential. However, land retains substantial value even with a conservation easement in place, as many landowners who have sold land over which they have granted conservation easements can attest. There is a good market for land subject to conservation easements in areas like Rappahannock County where many buyers are interested in acquiring and enjoying farmland as it is, rather than for speculative purposes.

Fiction #12: The only benefit of a conservation easement is to “rich people” who can use the tax write-offs.

Fact: The public benefits of conservation easements include maintaining scenic open space, clean air, clean water, and land available for farming. These benefits are the reason why places like Loudoun County and Fauquier County, where development pressure is strong, actually pay landowners to put conservation easements on their land. It may be hard to appreciate the value of open land in a county like Rappahannock where there is so much of it. However, Loudoun, Fauquier and Culpeper Counties were all once like Rappahannock. Conservation easements are one way to insure that Rappahannock stays the way it is now and doesn’t become like every place else.

Conservation easements are a personal choice. People who don’t like them shouldn’t grant them. However, conservation easements should be judged on fact, not fiction.

As a matter of full disclosure, the author has contributed conservation easements on farms in Virginia and Michigan; he has taught and written (including a book about to be republished) about conservation easements; and his law practice is devoted to conservation easements. Nevertheless, the foregoing facts are easily verified and are honestly presented.

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One thought on “Conservation easements: fact and fiction

  1. What a lie! Conservation easements allow future agricultural use? Sure, but conservation easements with the PEC only allow future agricultural use if you are using the land in a “PEC Approved” manner. Consider the farmers that the PEC threatened with lawsuits if they didn’t fence the land in the way the PEC wanted it fenced, or the farmers the PEC sued when they tried to build a small overnight loft near the barn where they could keep track of calving animals. Farmers threatened with lawsuits by a big conservation group tend to roll over, rather than try to fight. Allow future agricultural use? Not even!

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