A conservation easement is a binding legal agreement made between a landowner and a qualified conservation organization (i.e. Palmer Land Trust) that protects lands with important conservation values, which provide public benefit. The Internal Revenue Code (“IRC”) delineates that an easement protect one or more of the following conservation values: public recreation/education, natural wildlife habitat, open space, or historic preservation. In many cases, agricultural properties possess open space and natural habitat.
Any landowner with qualifying conservation values may grant a conservation easement to an authorized holder of easements (a land trust or a government entity). If the property belongs to more than one person, all owners must consent to granting the easement. If the property is mortgaged, the lender must subordinate its interest to the easement holder, so that the easement will not be terminated in the event of a foreclosure.
Owning land is like owning a bundle of rights. A landowner can give up the whole bundle or just a portion of the rights. When placing a conservation easement on a property, the landowner retains most of his/her rights, but gives up certain rights (development rights) in order to forever protect the conservation values of the property. The rights that are transferred are conveyed to a qualified conservation organization, which is bound by the law to hold the rights and enforce the terms of the easement. Land trust personnel will inspect or “monitor” the property on a regular basis, usually once each year, to ensure the landowner is in compliance with the terms of the easement.
Each conservation easement is unique to the property it is designed to protect and to the needs of the landowner granting the easement. A conservation easement is designed to last forever, and it runs with the land; it is binding on the landowner who grants the conservation easement, as well as all future owners.
A conservation easement restricts development in order to protect specific conservation values. Some easements are very restrictive, while others are not. Even the most restrictive easements generally permit the continuation of historical land uses.
Why would someone place a conservation easement on a property and limit potential uses of the land? There are many advantages to putting a property under conservation easement. Most importantly, a landowner granting a conservation easement can ensure that the land under easement will be protected forever. Additionally, many landowners are eligible for substantial income, property, and estate tax benefits.
AN IMPORTANT NOTE: a conservation easement does not require a landowner to open his/her property to the public.