Conservation easements are the primary tool that Bear-Paw Regional Greenways uses to conserve land. They are the ideal tool for the land owner who wants their land preserved, but wants to retain ownership.

Steps to a Conservation Easement

A conservation easement is a voluntary, legally binding agreement designed to permanently protect a property from development. An easement is donated or sold by the landowner to a conservation organization or public entity that "holds" the easement. The landowner retains ownership of the property but relinquishes the development rights, which are forever extinguished. The easement holder is legally obligated to monitor the property, generally on an annual basis, to ensure that the terms of the easement are not violated.

Given the long term legal obligations that an easement creates for both current and future landowners and the organization that holds the easement, the process of completing a conservation easement, not surprisingly, can be complex and time consuming. The process can take from several months to several years, depending on the complexity of the transaction and the speed at which the various parties involved complete each step. Bear-Paw will assist, guide, and support landowners throughout the process.

It is important to note that the process outlined here is meant to give landowners a general idea of the steps involved in completing a typical easement, but the steps may not be required for all transactions. Likewise, some projects may require additional tasks not included here. Each land protection project is unique, so it is important that you speak with a land protection specialist who can advise you on a course of action that is appropriate for you.

Several of these steps noted here involve costs that may be incurred by the landowner. In many cases, Bear-Paw can work with landowners and our project partners help defray some or all of these costs.

Step 1 - Planning and Gathering Information

The first step for any landowner is to engage in some planning and information gathering. Bear-Paw has information to send you on the different options for selling or donating a conservation easement. Often, family members will have an interest in the property, and one or more family meetings might be useful. Some families have found it useful to hire the services of a mediator or a facilitator to help the group reach a decision. It is difficult to convey an easement if everyone does not agree on how to proceed.

Another part of the planning process may involve meeting with an adviser, such as an attorney who has experience in conservation transactions. This adviser can help you figure out how donating or selling an easement fits with your overall estate planning, financial planning, or retirement goals. Although it is recommended that landowners meet with an attorney early in the process, so as to more fully understand his or her options, some choose to hire an attorney near the end of the deal, to perform a review of the easement. Either way, it is useful and usually less expensive to hire someone who is experienced with easements.

Step 2 - Negotiating the Terms

Although Bear-Paw usually starts with a "model" easement, the document must be tailored to meet the particular goals for you and the property. Easements include a variety of provisions, and most of these are negotiable. Among the key issues to be worked out are whether any building lots will be reserved, what uses of the land will be permitted or prohibited, and whether to allow public access to the property.

Step 3 - Appraisals, Surveys and Other Supporting Documents

If you will be seeking a tax deduction for the donation or partial donation of an easement, you will need to commission an appraisal of the value of the easement. Bear-Paw can refer you to appraisers who have experience in conservation transactions (Link to "Surveyors, Appraisers & Attorneys"). It may not be necessary to commission a survey of the property in order to donate a conservation easement.

Bear-Paw will do most of the work in the period leading up to the signing. For instance, a land trust representative will tour your property in order to prepare what is called a Baseline Report, which will serve as a benchmark to facilitate the trust's monitoring efforts.

Step 4 - Signing the Easement

As with any real estate transaction, there comes a time for all of the parties to sit down at a closing. As a general rule, the deal becomes official at the moment you sign the easement.

Step 5 - Claiming Tax Benefits

If an easement meets basic requirements dictated by the Internal Revenue Service, landowners usually are able to claim a federal income tax deduction for the donation of a conservation easement. To do so, you must file a special form with your income tax return (Form 8283). The amount of your deduction will be determined by the appraisal of the easement that was commissioned in Step 3. Depending on where you live, you might also be eligible to receive state and local tax savings as well.

Step 6 - Monitoring and Enforcement

As the landowner, you will continue to remain in touch with Bear-Paw after the easement is completed. Most importantly, someone from the land trust will make an annual monitoring visit to make sure that the terms of the easement are being followed. You will be contacted prior to the visit so that you can accompany Bear-Paw during the visit.