Tax incentives for land conservation work

An article from the May 3rd, 2010 edition of the Atlanta Journal Constitution

By Larry Wills

In 2009, with every other component of the American economy dead in the water, land conservation in the Deep South had a record-setting year.

The Alabama Land Trust Inc. and the Georgia Land Trust Inc. and their affiliate organizations now protect more than 153,249 acres, thanks to about 40,000 acres added in 2009, setting a record for a single year.

This at a time when historic and cultural preservation, parkland acquisition and other local and state government conservation initiatives are facing deep budget cuts because of plummeting revenues.

Georgia’s budget for the remainder of fiscal year 2010 and FY 2011 hit state preservation funding with a meat cleaver.

This follows on the heels of 2009 reductions. Preservation at the local government level is on hold and may never come back to former levels.

The only bright spot in the area of conservation during these dark days of recession are the not-for-profit land trusts.

Beginning about 1990, land trusts started proliferating in the United States, signaling the beginning of a new environmental movement.

Landowners, filled with a desire to be good stewards of the natural and cultural resources contained on and under their property, and seeking income tax deductions, have made the land trust phenomenon the most successful conservation movement in U.S. history.

Nationwide, some 37 million acres have been protected by land trusts.

The Alabama Land Trust and the Georgia Land Trust are two of the most active and successful members of this movement.

Land trust projects depend on a private initiative, making them more compatible with the ideals of capitalism than government preservation efforts that are often insensitive to the concerns of property owners.

The primary tool of a land trust is the conservation easement.

The Alabama Land Trust and the Georgia Land Trust have made good use of this legal instrument, partnering with some 423 individual landowners.

By entering into a conservation easement, landowners agree that certain portions of their property, such as unique habitats and scenic areas, go undeveloped forever, or valuable farmland and timberland is preserved for agricultural use.

The courts and the Internal Revenue Service have deemed the establishment of conservation easements to be a charitable donation.

Between 2007 and 2009, the Alabama Land Trust and the Georgia Land Trust combined to protect more than 85,000 acres.

The charitable gift may be used in the year of its donation with a five-year carry forward at 30 percent of the donor’s adjusted gross income.

The tax dollars saved by a property owner depends on their income and the amount of the donation, but a good rule of thumb is that 25 to 45 cents will be saved for every dollar donated. In other words, an easement valued at $100,000 will save a property owner between $25,000 and $45,000 in taxes.

Land trusts are certified by the federal government, which periodically monitors the conservation easements to assure they are being used as intended. The results of these site visits are kept on file.

The combined staff of the Alabama Land Trust and the Georgia Land Trust revisited every acre of their conservation easements by land or by air in 2009, in addition to visiting and evaluating more than 70 new easement candidates.

Their total amount of protected land equals 239 square miles, roughly the size of DeKalb County, except these valuable habitats, historic family farms, productive soil and timber plantations are sprinkled from the Blue Ridge Mountains and the Cumberland Plateau to the Tupelo and Cypress Swamps of Mississippi, Georgia and Alabama.

Most people associate land trusts with large rural land tracts, but they also have found a place in the urban and suburban environment.

In 2009, a 5-acre conservation easement was established in the Druid Hills Historic District of Atlanta. It contains the remains of an old mill site, giant tulip poplar trees and has a historic connection to the 1863 Battle for Atlanta.

Congress is currently considering renewing the special tax incentive for conservation easements passed in 2006.

This incentive raised the deduction on a conservation easement from 30 percent of adjusted gross income in any year to 100 percent for farmers and ranchers, and 50 percent for all other property owners, and extended the carry-forward period for a donor to take tax deductions for voluntary conservation agreements from five to 15 years.

Congressional approval of the higher incentives appears promising, but in either case, the future of America’s unique capitalistic approach to land conservation looks bright for many years to come.

Larry Wills, a freelance writer, lives in Marietta.

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