The Payoff of Conservation, Part 2 of 3

Clearly, MRG’s involvement in the field is not a passing fad. In recent years, there have been many whom have jumped on the conservation easement “bandwagon,” as the economic benefits of protecting one’s land became increasingly lucrative, acreage conserved increased exponentially, and the movement went mainstream. But now that the land protection arena is currently go through much-needed scrutiny as a result of some potentially fraudulent transactions (see Denver Post article, 12/6/07), we’re starting to hear lots of folks bemoan CE’s. Although the vast, vast majority of the deals that established land trusts have done in Colorado, for example, are good, solid deals, there are apparently a few renegade groups acting outside this professional arena allegedly doing some fraudulent transactions, organizations formed as contrived pass-through entities, not genuine not-for-profit land trusts that evolved through the grassroots efforts of local members of a community. Unfortunately, such improprieties are sometimes part of the playing field as a movement matures and evolves in to the mainstream, with folks having read a lot of land conservation’s glowing press and then sometimes getting involved for purely financial reasons, and bad apples studying the system, looking to take advantage of loopholes. In response, here in Colorado, the land trust community is working with the IRS and the State of CO to root out these bad actors, fill loopholes, and, nationally, put into practice a regulatory process that includes industry-wide standards and practices and accreditation of individual organizations to ensure that such alleged fraud cannot continue, but that the good work can.

While others may jump off the conservation “bandwagon,” MRG will remain on this ride for the long-term because we believe there is a pay-off business-wise and because there is much important land protection work left to be done. In some areas, ranch brokers feel too much land has been protected and that a perceived low inventory of unrestricted ranchland might somehow shackle the industry. However, statistics tell us otherwise, as only 1.5% of land is protected in CO and much less in other western states. Of course, conserved land can still be sold and re-sold, too, so as far as realtors are concerned, protected land stays on the docket. Sure, encumbered ground might be a bit more of a challenge to market and some buyers have a knee-jerk negative reaction to it, but I, for one, have found that spending a few minutes educating a prospective buyer on the truths of conservation easements can often get them past their pre-conceived notions that are often the result of misinformation. Other opponents claim that conservation easements erode a landowner’s private property rights. On the contrary, CE’s actually allow landowners to exercise more of their private property rights, not less, so I am often befuddled at this perspective. Moreover, it is a landowner’s personal choice to enter into an easement, an agreement that is customized to fit their needs and that of their land’s and often the result of detailed consultation with family and financial and estate planning experts, not something that is lightly entered into or the result of any heavy-handed government actions or regulations. Indeed, conservation real estate transactions are the often a symbol of the free market in action, where many landowners choose between alternatives, the outright sale of their land, the sale of a conservation easement on some or all of their land at appraised value, or nothing at all. This is why there is so much support on both sides of the political aisle for conservation easements done right.

By Tommy Latousek

Stay tuned for the the final edition of this series tomorrow.

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