Trust Our Land: Washington lawmakers move to strengthen conservation easements (column)
January 17, 2018
Land trusts across the country are working hard to preserve the lands that make America beautiful and ecologically viable. For decades, landowners have been able to receive enhanced tax benefits in exchange for permanently limiting development on their land while retaining full ownership and management by entering into a voluntary conservation easement agreement.
Landowners can exercise this private property right by signing a contract (the conservation easement) with an accredited land trust (such as the Eagle Valley Land Trust) or a government agency. Land conserved via a conservation easement is land protected forever. Conservation easements are the only land conservation tool whereby landowners can leave a permanent legacy of conservation in exchange for fair compensation.
The clear majority of Republican and Democratic lawmakers in the House and Senate continue to support land conservation in the United States. Congress is currently working to pass a law that further protects these agreements, thereby further protecting the public benefit that these permanently conserved lands provide.
Land Is Valuable
Land is valuable. The vast majority of conservation easement transactions are legitimate, properly valued and handled by land trusts that are nationally accredited with the Land Trust Alliance to uphold the highest ethical standards. However, a handful of overzealous real estate investment promoters have threatened to jeopardize the conservation easement tool by creating and attracting investors to clearly fraudulent "conservation" schemes and hoping they will go unnoticed.
The Land Trust Alliance outlines these schemes as follows: "Unrelated investors fund land acquisition through various pass-through entities, such as partnerships or limited liability companies. After a short holding period, usually fewer than three years, the entities donate conservation easements … and claim deductions based on appraised values that are significantly in excess (often by three to 10 times) of the original acquisition price. As a result, investors receive exaggerated tax benefits that are worth significantly more than the investors' initial investment. Typically, promoters organize these transactions in return for high fees."
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These fraudulent deals promise extraordinary tax shelters for a comparatively low investment. In response, Congress has proposed the Charitable Conservation Easement Program Integrity Act, which enhances the veracity and durability of conservation easements by closing this loophole in the tax code. If passed, then Congress will ensure that this vital and useful conservation tool will remain in place.
Eagle Valley Land Trust is accredited by the national Land Trust Alliance and upholds the highest ethical standards alongside all accredited land trusts nationwide. As an accredited land trust, Eagle Valley Land Trust cannot (and will not) participate in fraudulent transactions.
The integrity of conservation easement donations and tax benefits is essential to the work of all legitimate land trusts. Some have threatened this integrity, which threatens to undermine the entire land-conservation process. By taking action, Congress will further protect these vital agreements.
This act will allow the benefits available to landowners to continue, rewarding honest philanthropy while closing the door on further abusive profiteering of this charitable incentive for conservation. For more information, visit http://www.lta.org.
Bergen Tjossem is the communications and fundraising coordinator of Eagle Valley Land Trust. He can be reached at email@example.com. For more about the Eagle Valley Land Trust and how it is conserving land and benefiting the community, visit http://www.evlt.org.