Conservation Easements

[Bucky]

The article on the Cattle Today front page:

http://cattletoday.com/archive/2006/August/CT520.shtml

What is your opinion / experiences with conservation easements? Know of any good resources about them? I am suspicious of anything that takes away property rights but I wonder if I am just not educated enough about them?

Thanks-
M

 

[Dave]

There are a number of different conservation easements and they probably all work slightly differently. But for example the NRCS Grassland Reserve Program is designed to preseve grassland (duh). They calculate what your land is worth for development and what it is worth for grazing. They pay you the difference between those two figures. So if the land is worth $5,000 an acre for development and $500 as grazing land you get $4,500 per acre. An easement is put on the title of the land and it can not be developed. So it is grassland forever. But it remains yor land to do as you please as long as it remains grassland. There are some other minor limitations but I can't remember what they are.
CRP is a very common conservation easement program in the west. It is one with a limited time as oppsed to the GRP which goes on forever.
As I said there are a nmber of different programs federal, state, and private. Some are very set in their structure and some are very flexible and can be customized to meet the landowners needs.
Dave

 

[Auburn_Ag]

Bucky

I have seen a lot of good land go under various different conservation easement programs. Personally would never do it. I could see where it would be good for like wetlands or woodlands that could not be used for building purposes, but that is it. Who's to say that some day these type of lands would not be used for something good for the community. For example, our beaches, 100 years a go you could buy beach front for pennies on the dollar, because it was not good for farming. However look at it today. When you buy property you get in theory a bundle of rights. If you sale to one of these groups that want to put a conservation easement, you are giving up one of those right, which most of the time is to prevent any type of buildings to be built, including barns.
Buying property without all of its rights is like buying a car with no engine.

I know these environmental groups have there place, but who were the first environmentalist, FARMER and RANCHER!!! The land, one way or another is livelihood of Farmers and Ranchers. A lot of people seem to for get that.

 

[john250]

Bucky

I have seen a lot of good land go under various different conservation easement programs. Personally would never do it. I could see where it would be good for like wetlands or woodlands that could not be used for building purposes, but that is it. Who's to say that some day these type of lands would not be used for something good for the community. For example, our beaches, 100 years a go you could buy beach front for pennies on the dollar, because it was not good for farming. However look at it today. When you buy property you get in theory a bundle of rights. If you sale to one of these groups that want to put a conservation easement, you are giving up one of those right, which most of the time is to prevent any type of buildings to be built, including barns.
Buying property without all of its rights is like buying a car with no engine.

I know these environmental groups have there place, but who were the first environmentalist, FARMER and RANCHER!!! The land, one way or another is livelihood of Farmers and Ranchers. A lot of people seem to for get that.

I haven't seen a lot of Conservation Easements, but from my limited knowledge the sellers of the easement are fully aware of what they are giving away in development rights. Any subsequent buyers of a property with an easement would be aware of that easement and the price paid would reflect that knowledge.

Honda is building a new factory at Greensburg, IN. Big project, and it will lead to rebuilding an interchange on I-74. Quoted in the Indy Star, a man who owns 70 acres which would be taken for the interchange said he has the papers ready for signing to put a Cons. Easement on the land. Says the land is too good to be paved. (He's right. Soils there are in the top 10% of the planet.)

I guess I kinda like the notion that some folks are willing and able to pass on the money. Wish I was among them.

The better way to preserve farms is to make farming profitable.

 

[Bucky]

Thanks for the info.

I always like it when people will stand-up to the big dogs, but I wonder if the new Eminent Domain ruling would push over his conservation easment? :x

The new thing I hear about with conservation easements is people putting them on their land and taking the money to buy out the relatives they can't afford to buy out after the parents or whoever dies and it is time to settle the estate. Don't know what I think about that either.

 

[3MR]

Many of the easments merely prevent the land from being converted from agriculture use. It doesnt prevent you from doing anything agriculture related, such as building a new barn.

 

[mayesfarm]

I though that I would revive this thread... As of now, I have little knowledge of land trusts and conservation easements and would appreciate any and all insight from anyone with personal experience. There are a ton of vague resources available online, with little to no substance. What I do know is that these agreements should not be entered into without lots of thought and good advice. I have a million questions and no clear answers. May be the only way that the next generation can afford to keep property? Could easements keep the developers from forcing farmers out of their own communities? Might keep the transplants off the Yellowstone!

 

[Ebenezer]

"...it remains your land to do as you please"
Not so. If you sign up for grassland preservation and then want to add waterlines and troughs - that is prohibited as you disturb sod. I know a guy who signed up, then wanted a few acres back to put in the end of a dam for irrigation water for the farm and was denied. 99% of the pond and dam was to be in a wooded draw that was not included. I see so much of this as heavy handed. And who can predict the future or guess at all potential options or family situations. Like thinking back 25 years and now knowing about cell towers and such.

Generally, the burden is on the later generations to keep the land as-is even if the farming of it is a money losing proposition or they have no interest in farming but might want to do other farming. That forces the relatives to sell rather than lets them keep it.

Some of the wetland restorations or banks are a wonderment to me. Who is really going to keep them up in 50 years? What if the money runs out: who gets the nod to pay...

More of a pot at the end of the rainbow deal in a lot of ways.

 

[Mark Reynolds]

I though that I would revive this thread... As of now, I have little knowledge of land trusts and conservation easements and would appreciate any and all insight from anyone with personal experience. There are a ton of vague resources available online, with little to no substance. What I do know is that these agreements should not be entered into without lots of thought and good advice. I have a million questions and no clear answers. May be the only way that the next generation can afford to keep property? Could easements keep the developers from forcing farmers out of their own communities? Might keep the transplants off the Yellowstone!

Conservation easements are designed/meant to keep land uses (what I think of as agricultural) what they currently are in perpetuity. There are several different easement programs, but they all pretty much have the same goal in mind. Protect the land from development that is not agricultural (or environmentally friendly, but the use of the word environmental any more has some 'newer' interpretations/definitions that I don't care for). CRP (Conservation Reserve Program) and GRP (Grassland Reserve Program) as mentioned above aren't really Easement programs, although they are designed to protect the land. CRP and GRP are cancelled/easily cancelled when/if the user/owner loses control. an Easement attaches useage constraints to a piece of land that CANNOT be removed when the control of the land changes. I know a little bit more about easements than other NRCS employees in my part of the state, but we don't have any easements in my part of the state to speak of. I've worked the mapping portion end of the Easement program where I am for the entire state which is why I have some knowledge.

Please post your specific questions here, or message me directly if you prefer. I would encourage you to contact your STATE NRCS (not local, but they can get you the contact info) and talk directly to their Easement Specialist (yes, they have one of those, I've worked extensively with ours in Ohio).

 

[StrojanHerefords]

Mayesfarm, if you could tell us what is motivating your interest conservation easements.
From my view, the various easements and conservation programs, I have seen are little more than a modern day version of the old practice of trying to buy your way into heaven. The programs are a way to distribute money rather than providing any conservation benefits. The only way to ensure that a family farm will continue is to raise children and grandchildren who have the right stuff to farm.

 

[Brute 23]

Conservation easements have become very popular here on the gulf coast. Yes, they are being done to purposely prevent development along the coast. A lot of that land was held in large tracks by some of the original families in Texas development. As some of it got sold and turned in to beach houses the others took note. People have realized the devastation that has caused.

I believe there are also some tax benefits that can be utilized for estate planning.

Some of the burning we do every year is on conservation easements. Some of it is held by private owners and some is held by organizations that will buy or own those easements.

I'm a big believer in land owner rights but I think it's great when people do these types of things. I hate seeing these developments on the coast line. Quite a few people are donating land over for the draw hunts in Texas also which is another great program.

 

[Mountaintown Creek Ranch]

My wife and I created a trust so when we die our greedy assed relatives can't build it out or sell it for something like 300 yrs.

 

[Mark Reynolds]

My wife and I created a trust so when we die our greedy assed relatives can't build it out or sell it for something like 300 yrs.

If that is your goal, check into adding an Easement. Not only will this increase the difficulty in building on it (Easements are more difficult to dissolve than a Trust) the Easement will last potentially much longer, and you can get added financial benefits from it such as payout in difference in POTENTIAL assessed value, and tax benefits which have already been mentioned.

 

[mayesfarm]

Mayesfarm, if you could tell us what is motivating your interest conservation easements.
From my view, the various easements and conservation programs, I have seen are little more than a modern day version of the old practice of trying to buy your way into heaven. The programs are a way to distribute money rather than providing any conservation benefits. The only way to ensure that a family farm will continue is to raise children and grandchildren who have the right stuff to farm.

My motivation is mainly trying to protect my family and our multi generational land from development. Our "home farm" or headquarters has been in the family for 4 generations. We are in a very hot real estate market , 60 miles east of Nashville, quickly becoming a bedroom community for Murfreesboro and Nashville. In the past few years, most of the farms in the community have been bought up by out of town doctors or out of town residential developers. We have already had 1 forced sale of a couple of acres to the city government for a water tank. My main concern is that the government will want to take more of our property for "public good" until there is none left. I sure am not worried about "buying my way into heaven", just trying to protect my family's piece of earth.

Please correct me if I'm wrong, but don't think that all conservation easements involve money. I am looking to prevent division and development, that's it. Who enforces them? I really don't want a government agency or one of the hippie outfits involved. Give the next generation an opportunity, part of giving them "the right stuff to farm" is ensuring that there is land available to do so.

I am going to respond to Mark Reynolds with some questions later. Just wanted to try to gain some knowledge from folks who have experience with them.

 

[Dave]

It is a good thing this came back up. I am in the process of signing up the range land portion of the ranch into GRP. I also have Idaho Power working on buying an easement to build a power line. Going to have to talk to the FSA man about this. I don't think that I can enroll the 10 acres or so that will be in the power line easement into GRP.

 

[Mark Reynolds]

My motivation is mainly trying to protect my family and our multi generational land from development. Our "home farm" or headquarters has been in the family for 4 generations. We are in a very hot real estate market , 60 miles east of Nashville, quickly becoming a bedroom community for Murfreesboro and Nashville. In the past few years, most of the farms in the community have been bought up by out of town doctors or out of town residential developers. We have already had 1 forced sale of a couple of acres to the city government for a water tank. My main concern is that the government will want to take more of our property for "public good" until there is none left. I sure am not worried about "buying my way into heaven", just trying to protect my family's piece of earth.

Please correct me if I'm wrong, but don't think that all conservation easements involve money. I am looking to prevent division and development, that's it. Who enforces them? I really don't want a government agency or one of the hippie outfits involved. Give the next generation an opportunity, part of giving them "the right stuff to farm" is ensuring that there is land available to do so.

I am going to respond to Mark Reynolds with some questions later. Just wanted to try to gain some knowledge from folks who have experience with them.

I appreciate that you are not wanting to secure a conservation easement for monetary reasons and have as the goal protecting the land from development. However, like it or not, you are going to get paid for the easement. If you are concerned about this aspect, you might want to talk to 'Pam' (see my message) and your accountant (I'm guessing about tax implications). I understand your reluctance about working with a government agency. Government agencies are often thought of as being regulatory and over-reaching. The NRCS strives to be different from that. Specifically, we are designed to be non-regulatory, quite the opposite of what government agencies are thought of. Our mission is to "Help People Help the Land". We strive to identify and address 'resource concerns' or rather existing conservation problems and fix them with program funding assistance, not regulate, punish, fine and force producers to pay for their problems.

As for finding someone with an existing conservation easement to get information from, let alone multiple producers, I think you might have some difficulty with that.

| Natural Resources Conservation Service

www.nrcs.usda.gov

This site will help anyone who is interested.

 

[kenny thomas]

Most tax maps in Virginia identify tracts that are under an easement.

 

[Mark Reynolds]

It is a good thing this came back up. I am in the process of signing up the range land portion of the ranch into GRP. I also have Idaho Power working on buying an easement to build a power line. Going to have to talk to the FSA man about this. I don't think that I can enroll the 10 acres or so that will be in the power line easement into GRP.

I would get an attorney to review the easement with the utility company, one that specializes in this type of easement......Now, storytime: I have heard of an easement made with a pipeline/natural gas/utility company where the easement was for the company to be able to add pipeline to the property. Take note that this does not specify the size of pipelines, number of pipelines, or that the company has to compensate the landowner for each disturbance to the property each time a pipeline is added, or that the property owner gets compensated for each additional pipeline, at the current rates, that is added. Now imagine everything that the company can take advantage of with this easement.....It has happened. Easement was created, company has now added multiple pipelines of sizes well above the original pipeline multiple times destroying the pasture each time pipeline is added without the property owner being compensated. This easement is still in place, the property owner can't change it, and the utility company can add more pipeline to this day without consequences. Enter another created easement. This one specified a limit on size of pipeline that may be installed, required company to compensate property owner for each and every disturbance at current rates (may have been so much above current rates, limits the number of pipelines that are installed, and has requirements of the company if the pipelines fall into non-use/are abandoned. An additional line has been added to this location as well, but I think that possibly a whole additional easement was required to be obtained by the utility company, and the property owner was compensated nicely for it and not ran roughshod over by the utility company like the property owner with the first easement.

FSA will be good for agricultural easements. They will be limited in their knowledge and ability to assist with a utility easement, as am I.

 

[Brute 23]

I would get an attorney to review the easement with the utility company, one that specializes in this type of easement......Now, storytime: I have heard of an easement made with a pipeline/natural gas/utility company where the easement was for the company to be able to add pipeline to the property. Take note that this does not specify the size of pipelines, number of pipelines, or that the company has to compensate the landowner for each disturbance to the property each time a pipeline is added, or that the property owner gets compensated for each additional pipeline, at the current rates, that is added. Now imagine everything that the company can take advantage of with this easement.....It has happened. Easement was created, company has now added multiple pipelines of sizes well above the original pipeline multiple times destroying the pasture each time pipeline is added without the property owner being compensated. This easement is still in place, the property owner can't change it, and the utility company can add more pipeline to this day without consequences. Enter another created easement. This one specified a limit on size of pipeline that may be installed, required company to compensate property owner for each and every disturbance at current rates (may have been so much above current rates, limits the number of pipelines that are installed, and has requirements of the company if the pipelines fall into non-use/are abandoned. An additional line has been added to this location as well, but I think that possibly a whole additional easement was required to be obtained by the utility company, and the property owner was compensated nicely for it and not ran roughshod over by the utility company like the property owner with the first easement.

FSA will be good for agricultural easements. They will be limited in their knowledge and ability to assist with a utility easement, as am I.

I've seen it both ways. Some are one line easements and some allow for multiple lines. The company will have to have a larger, short term, construction easement, which will likely pay damages. The original agreement will determine if that all has to be renegotiated or not.

Not sure how that plays in to the conservation easement.

I've never actually seen the paperwork on one but I would like to. Just from talking to people there seems to be quite the variety.

One of my concerns is that if a govt agency manages it, and their goals change, then it could end up being used in a way you did not intend. I know they would not go for it, but to me, the goals should be listed out in the agreement. If the agency attempts to change the goals, the deal is done and it reverts back.

 

[Dave]

I would get an attorney to review the easement with the utility company, one that specializes in this type of easement......Now, storytime: I have heard of an easement made with a pipeline/natural gas/utility company where the easement was for the company to be able to add pipeline to the property. Take note that this does not specify the size of pipelines, number of pipelines, or that the company has to compensate the landowner for each disturbance to the property each time a pipeline is added, or that the property owner gets compensated for each additional pipeline, at the current rates, that is added. Now imagine everything that the company can take advantage of with this easement.....It has happened. Easement was created, company has now added multiple pipelines of sizes well above the original pipeline multiple times destroying the pasture each time pipeline is added without the property owner being compensated. This easement is still in place, the property owner can't change it, and the utility company can add more pipeline to this day without consequences. Enter another created easement. This one specified a limit on size of pipeline that may be installed, required company to compensate property owner for each and every disturbance at current rates (may have been so much above current rates, limits the number of pipelines that are installed, and has requirements of the company if the pipelines fall into non-use/are abandoned. An additional line has been added to this location as well, but I think that possibly a whole additional easement was required to be obtained by the utility company, and the property owner was compensated nicely for it and not ran roughshod over by the utility company like the property owner with the first easement.

FSA will be good for agricultural easements. They will be limited in their knowledge and ability to assist with a utility easement, as am I.

I have an attorney working on the power line easement. He is representing 25 landowners in this county. This is a 500k mega watt powerline. It will cross a mile of my property and have 5 of those big steel towers. The site is nasty nasty ground. In that mile there is over 2,000 feet of elevation increase. Their first offer was more like an insult. My attorney went back with a counter offer which was a lot bigger. They came back with an offer that was 8 times their original offer with the sitpulation that sign in 14 days or they would take me to court. The Lawyer said don't get excited and sign anything. Power company came back 14 days later with the same offer but this time they gave me another 40 days to sign. Lawyer chuckled. He says he would fun to be in front of a Baker County jury with his information and case. He laid out his case to me. He feels confident and so do I. They wont be building anything else on this easement. Certainly not a pipeline. There is already a pipeline down by the freeway on land much more suitable for that type of project.
The GRP just requires that you leave it in grass. 95% of this ground can never be worked. It would be suicide to attempt to get on i twith a tractor of any sort. I am leaving the hay meadows out of the contract. Some requirement about bird nesting. That leaves around 1,130+/- acres going into the program.
The first picture is where the power line is going to go. That knob in the center is where the first tower will be. That is a whole lot steeper than it looks in the picture.
Second picture is a good portion of the GRP. Again it is much steeper than it looks in the picture. It is grass and will never be anything else.