Friday, July 8, 2016
As I prepare for next week's free ABA webinar on conservation easements, I have been thinking a bit about what advice I would give attorneys representing landowners. While I sometimes twice represented landowners in practice, I mostly think about conservation easements from the holder side. I think of my research as generally talking to land trusts and government agencies. So trying to approach things from the perspective of the landowner has been a harder exercise for me than anticipated.
One of the pointers I have for landowners is thinking carefully about who they want to convey a conservation easement to. It may feel like it doesn't matter too much which land trust (or government entity) holds the conservation easement as long as the as the landowners find the terms favorable, but I caution against that. First, with perpetual agreements it is pretty durn likely that one day an ambiguity or dispute will arise. Your conservation easement didn't contemplate potential highways for flying cars? They aren't expressly prohibited, so they must be allowed unless they conflict with the purposes of the conservation easement or the conservation values. They don't actually disturb the surface... so maybe you can still farm? are they scenic? how high off the ground do they need to be? Maybe we can easily figure this out from the CE, but it helps if the general goals of the holder align with the aims of the landowner. Do you want to give the conservation easement to The Audubon Society or to the Marin Agricultural Land Trust?
New scholarship appear in the journal of Landscape and Urban Planning seeks to examine how to match up landowner and land trust desires in making a partnership. The social scientists (Christopher Bastian, Catherine Keske, Donald McLeod, and Dana Hoag) seek "to improve the efficiency by which parties interested in conservation easement transactions are matched." They suggest that by better understanding preferences of different groups, those engaged in land conservation transactions can reduce transaction costs and improve conservation easement acceptance rates. The authors are focused on market efficiency, which is a challenge with conservation easements because the valuation of them and the marketplace differs greatly from those for other property rights. I think this article might be most interesting for landowners contemplating donating a CE than for land trusts determining which ones to accept.
A few thoughts though about different elements of the article
- Based on earlier studies by some of these authors and others, the article points out that conservation easements are most likely to arise where landowners are relatively wealthy and well educated. This reinforces concerns that I have generally about who is it that most benefits from CEs. Evidence suggests (meaning that I haven't *actually* gathered data on this) CEs are mostly likely to provide financial benefits to wealthy landowners. As Thomas Mitchell (moving to Texas A&M) has pointed out, minority landowners who are often land rich but cash poor have little incentive to donate a conservation easement when the tax benefits so exceed tax liabilities) .
- The article mentions that absentee landowners are more likely to choose a CE than where the owner occupies and works the land. Repeat comment above, but add to it a concern that with fewer eyes on the conserved land, we may have higher risks of third party violations or just a lack of interest in actively pursuing land conservation efforts.
- Additionally, where the land remains valuable for development, CEs are also less likely. Repeat comments from above and add to it a concern that CEs don't actually help us protect the lands that conservationists might target as most in need of protecting. This researchers appeared to focus on donated CEs so maybe this would change with purchased CEs.
- Neither land trusts nor landowners are really interested in public access. Unsurprising but interesting. Going back to my concerns about who benefits from CEs. I think land trusts used to push for public access until they started to get worried about potential liability issues (again, conjecture on my part, not based on any actual data I have collected)
- "Contracts for CEs are often negotiated privately in order to maintain landowner confidentiality for sensitive information such as annual income." Lots of interesting things here. First, they call them contracts (see previous post -- contracts or property rights?). Second, I am not sure what the alternative would be. Public negotiation? Because CEs are individually negotiated for the most part, it makes sense to me that these are just deals between two or three parties (maybe stick a funder or third-party enforcer in there). I was a bit surprised (and intrigued!) to think that the reason might be landowner concerns about sensitive information.Suggestions that such negotiations should have public components at all highlights the mix public-private nature of CEs.
- Land trusts thirst for info and are a great group to study. The response rates here are phenomenal. Land trusts get inundated with surveys by researchers trying to figure out what makes them tick. Their investment in the land conservation community is highlighted by their willingness to work with researchers. Good on ya!
Lots more good stuff in there. Check it out: Christopher T. Bastain, et al., Landowner and Land Trust Agent Preferences for Conservation Easements: Implications for Sustainable Land Uses and Landscapes, 157 Landscape & Urban Planning, 1 (2017).