Fact or Fiction: Land Trusts and Conservation Easements by Glenn Marx, Montana Association of Land Trusts

The first Montana conservation easement was created in 1976, and even though since that date a couple thousand landowners have worked with land trusts and public agencies to populate the Montana landscape with close to 2.5 million acres of conserved private lands, there are still many myths and misunderstandings about how land trusts and conservation easements work.

This article takes a look at some of these myths or misconceptions through a series of 10 Fact of Fiction statements.

  1. Fact or Fiction: All land trusts are pretty much the same.

Fiction. Land trusts vary widely in the areas in which they work, the focus of their work, and the diversity of projects they work on. Three quick examples: The Nature Conservancy is an international land trust working in Montana that focuses on specific areas and key wildlife species. The Montana Land Reliance is a statewide land trust that works only in Montana to primarily conserve agricultural lands and open land. Gallatin Valley Land Trust is a local land trust that works out of Bozeman and features a strong community trail program in addition to land conservation. While there are professional and operational consistencies among land trusts, there are also very distinct approaches to open land conservation.

  1. Fact or Fiction: All conservation easements are pretty much the same.

Fiction. A conservation easement is a willing buyer-seller negotiated transaction, and because landowners have different management goals, different financial situations, different property types and different family situations, conservation easements differ greatly in wording and intent. While conservation easements contain common components and some basic elements, they are also written with the landowner’s expressed land management and financial goals in mind.

  1. Fact or Fiction: Conservation easements can help reduce estate tax exposure and assist with succession planning.

Fact. Sometimes a landowner will work with a land trust on a conservation easement specifically to reduce estate tax exposure and/or to facilitate the transfer of property to the next generation. It should be pointed out that a conservation easement does not reduce property taxes.

  1. Fact or Fiction: Conservation easements are just for rich people.

Fiction. Conservation easements can provide a wide range of benefits to landowners, and a recent tax policy change approved by Congress and signed into law expands federal income tax provisions to benefit the traditional “land rich, cash poor” landowner. Depending on the value of the conservation easement and the financial situation of the landowner, it is possible to zero out income taxes for up to 16 years.

  1. Fact or Fiction: Montana’s conservation easement law is based on property rights.

Fact. The Montana Open-Space and Voluntary Conservation Easement Act passed the legislature in 1975 and after four decades of use has clearly stood the test of time. The Act allows a very limited role for government, allows flexibility within the context of a conservation easement, and has worked well for Montana landowners and Montana land conservation.

  1. Fact or Fiction: Conservation easements were created to conserve forests as well as farm and ranch lands.

Fact. Conservation easements are designed to keep land open and producing all the goods and services that flow from open land…clean water, wildlife habitat, forest health and wood products, farm and ranch products, scenic views and much more. Land trusts have been quite successful at working with large industrial and small and family lumber companies on projects that provide forest conservation and timber volume to mills.

  1. Fact or Fiction: When a landowner works with a land trust or a public agency to create a conservation easement, that landowner loses his or her property rights.

Fiction. The action of placing a conservation easement on private land by a landowner is the exercise of a property right, not the loss of a property right. The easement is negotiated by the landowner and land trust or public agency to reflect the landowner’s wishes, consistent with the purpose of the easement, and consistent with state law. Typically, a conservation easement will restrict, not eliminate residential development of the property, depending on the landowner’s management goals. The only way a conservation easement can be considered the loss of a property right is to also consider residential subdivision of the property as a loss of a property right. A conservation easement is not a regulatory tool. It is the product of a voluntarily negotiated agreement.

  1. Fact or Fiction: Conservation easements turn private land into defacto wilderness areas.

Fiction. Across about 2.5 million Montana acres conserved by conservation easements you’ll see cattle and pastures, irrigation pivots, agricultural outbuildings and equipment, timber harvests, four-wheelers, horses, machinery, crops and more. An important goal of a conservation easement is to help keep families and their forest or agricultural operations economically viable now and into the future.

  1. Fact or Fiction: There is an abundance of information available if a forest or agricultural landowner is interested in learning more about a conservation easement.

Fact. A conservation easement is typically permanent, and is an agreement – a contract – that should be taken seriously and with deliberation. Landowners should conduct extensive research about conservation easements, land trusts, the financial and tax ramifications of easements, and much more. Landowners should consult with a variety of professionals – attorney, banker, financial advisor, perhaps a Realtor, land trust staff and board members, agriculture groups, landowners who have conservation easements, landowners who oppose conservation easements, and more – to expand their knowledge about conservation easements and their confidence in proceeding toward an agreement.

  1. Fact or Fiction. Montana is a nationally recognized leader in both the quality and quantity of private land conservation.

Fact. Montana is among the top states for the number of acres conserved through easements, which demonstrates the stewardship commitment of Montana landowners and the dedication of land trusts and public agencies toward cooperative, voluntary, incentive-based conservation. Montana is also tops in the nation in the number of acres conserved by easements held by accredited land trusts, which speaks to the professionalism and integrity of the land trust community.

Conservation easements present a valuable and beneficial opportunity for landowners and for Montanans who cherish open land. But easements are not simple, they take time to negotiate and complete, and are not a good fit for some landowners. The more a landowner knows about conservation easements, the better. And that’s a fact.