Conservation Easement Presentation
To the Arizona/New Mexico Coalition
of Counties Annual Meeting,
March 24,2007
By Rachel Thomas
I am very concerned about Conservation Easements and the major organizations that hold them. Here is just a little bit of the information that I base my concern on.
Conservation Easements are a very powerful tool. They are used by government agencies and non-profit, or non-government organizations, to take control of the land. With a conservation easement, a portion of the owner's rights are held by either a federal or state agency, or a non-profit organization. The result is for perpetuity, in other words, forever and ever and ever and ever.
A conservation easement on a piece of property can be, and has been traded, bought, and sold among state and federal government agencies, as well as non-profit organizations. In the model conservation easements I have reviewed, I could find nothing that said the holder of the easement would have to notify the property owner of any changes in ownership for the easement.
The easement documents do include wording that the property owner agrees, not only for themselves and for their personal representatives, but also for their heirs and successors, to notify the holder of the easement, in writing, of the names and addresses of any party to whom the ownership of the property, or any part thereof, is transferred to, prior to transfer.
These non-profit organizations have a lot of money, and receive a whole lot more money, from every level of government. An example is The Nature Conservancy, one of the richest non-government organizations in the U.S. It has its main headquarters in Arlington, Virginia. Their reported assets for 2005 were $3.8 billion, with gross receipts of $1.9 billion. Government contributions amounted to almost $98 million. Payroll expenses were $193 million, and legal fees $2.1 million. The Nature Conservancy has many subsidiary corporations, including the Nature Conservancy San Rafael Ranch. Each of the subsidiary corporations files its own separate 990 Form, which is the IRS financial reporting form for non-profits. It is virtually impossible to obtain the total net worth or expenses for the organization.
The Land Trust Alliance had $5.2 million in assets, and a payroll of $2.6 million. It is the convener, strategist, and representative of land trusts across America. They received $558,393 from the federal goernment in 2005. Land Trusts in Arizona and New Mexico that had form 990 information available reported total assets of $15.4 million with at least $1.5 million coming from the federal or state governments in 2005.
A property owner must understand that by granting a conservation easement, he is not only restricting the future use of his property, he is actually conveying an interest in the property to a government agency or non-government (non-profit) organization such as The Nature Conservancy, or similar land trust. The property owners agree, not only for themselves and their personal representatives, but for their heirs, and their heirs, and their heirs, and their successors - forever and ever - to these restrictions on their property. This conveyance of interest results in a reduction in value of the property because it creates an unusual type of divided interest in the property that may give rise to future conflicts. It also prohibits prospective financially beneficial uses of the property in the future.
Before anyone gets upset over this statement about this reduction in value, I have heard of a few ranches that had a conservation easement that sold for a higher price than if they did not have a conservation easement. But then people from several financial institutions have shared their concerns over the depreciation of the value of these ranches with conservation easements on them. It is stated in several different land trust documents that a conservation easement on a property does reduce the future value of that property.
I am also concerned about the type and amount of information that is required from the individuals who are considering a conservation easement. A baseline inventory of the property is required in the beginning of the easement process, and then monitoring reports must be done one or more times a year. This baseline information includes maps, inventories of what is on the property, photos and aerial photos, types of grasses and forbs, etc. I assume that other kinds of information are also required, such as the number of livestock, how many acres of private, federal, and state lands, what kinds of endangered species might be found on the land, etc.
The Forest Guardians have been trying to obtain this kind of information on the ranching community from our federal and state agencies for several years now. How long do you think it will take them to obtain all this information from the easement holders?
There is a document on one of the land trust support websites, titled "Preparing for Future Litigation of Conservation Easements" authored by an attorney, Elizabeth Wroblicka. She predicts, given the nature of perpetuity, that it is inevitable a time will come when the provisions of the conservation easement must be enforced through the courts. It may be many years, when the next generation takes over managing these ranches and farms, but it will come.
There are many documents available on the plans to enforce these conservation easements, and the legal action the land trusts may take for their legal teams. There is very little information available to help the landowners and their legal advisors.
There are already legal actions occurring to enforce conservation easement restrictions. People are already having to remove buildings from their land. One of the saddest cases was in Chester County, Pennsylvania. In 1989, a gentleman purchased 42 acres of farmland, thinking it would be his property. He did not recognize the significance of language in the conservation easement that had been placed on the land 22 years earlier, by an older deed to the same property. The language in the conservation easement stated the land could only be used for farming or nature conservation, as well as for small buildings related to those uses. Nine years later, this language destroyed the man's life dream.
In 1998, the land trust sued to stop the construction of the farmhouse on the farmer's private land, but a Chester County Court ruled that the farmhouse was allowed under the restrictions. The judge ruled that the construction of the farmhouse did not offend the easement definition of a "small building" incidental to farming use. The judge emphasized that the burden of restricting a property owner's use of his land "is substantial," and that the "restriction must be specific and in words incapable of multiple interpretations." With the court ruling in his favor, he built the colonial house which would house three generations of his family while they farmed the land.
The land trust appealed, and the original count decision was reversed. The gentleman appealed to the Pennsylvania State Supreme Court. The court dismissed his appeal, and the final demolition order was given. In November 1998, the broken-hearted elderly man and his family had to stand by while a bulldozer tore into his new farmhouse and ripped it down to rubble. The family and the sheriff could only wrap their arms around the grieving man, while they watched the bulldozers rip the house apart.
Regardless of the wording in a conservation easement document, it will be left up to the courts to decide some meanings or intent in the document. And if the land trust loses in one court, they will just go to a higher court. They have the money. Do the landowners have the same deep pockets?
If all this is about the resources, why doesn't the money go to the people on the ground who have the knowledge about the resources, care about the condition of their land, and the experience to take care of the resources? Why doesn't this money go to the land grant colleges and universities to further their studies and assist the people on the ground?
The following is an example of this working on the ground. For 40 years, I have lived at my present home which is next to a ranch. This particular ranch was covered with black brush and greasewood, and very little wildlife or livestock forage. It has been so simple to make the needed improvements. A few years ago, a plane flew over the ranchland and spread a chemical treatment, a small pelleted material over a fairly large area of the ranch. As the years have gone by, the greasewood and black brush died, and an excellent ground cover of grass has returned. The monitoring shows the area that was treated has an increase of 500 percent more forage than the ranch land right next to it, which has not been treated. Just think what this has done, not only for the rancher, but for the wildlife and the recharge of water to the basin. In this case, the money went to the rancher. The improved resources have benefited everything and everyone connected with the land, including the wildlife that is now returning.
In my opinion, conservation easements are just a money making commodity for non-profit organizations. These conservation easements are bought, sold, and traded between non-profit organization and the state and federal agencies. The "environmentally green organizations" and government agencies say they want want conservation easements to protect the ranchers and the grazing. But then, other environmental activists say that cattle grazing on public lands is bad for the land; it fouls watersheds, causes erosion, and destroys habitat. They are asking that cattle be removed from the land on a fairly regular basis. And, cattle are being removed from the land on a fairly regular basis.
Here in Cochise County, the Nature Conservancy purchased a ranch and placed a conservation easement on the property that allows absolutely no agriculture use. In fact no productive use. No cattle allowed. Now the property has been purchased, and and the new owner wants the county to tax them at the agriculture rate - with no agriculture production.
I think that anyone who plans to take a conservation easement on their property should really do their homework. They should review and read every book and paper that is available in the library and on the Internet, before making their final decision. They should not take just the word of the people working for these organizations, but do their own homework. They should talk to the people who have been negatively impacted by conservation easements. There is lots of information out there.
Rachel Thomas is a staunch defender of Constitutional private property rights and she works hard every day to keep thousands of us informed on these topics.
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