New Developments in Conservation Easements

Posted on June 16, 2014 by Philip Tabas

Conservation easements have a long been an effective tool for private efforts to protect land in the United States. But we may not be aware that there is a growing private lands conservation movement in other countries. Conservationists in those counties are adapting the conservation easement as we know it here in the United States to conservation needs in their jurisdictions. Two recent examples highlight this growing trend, one in Micronesia and one in Chile.

As you will recall, a conservation easement is a legally binding agreement between a landowner and the easement holder whereby the landowner agrees to limit the use of his or her property to protect outdoor recreation, natural habitats, open spaces, scenic areas, or historic lands and buildings. Easements have been on the rise in the United States since the 1980s because of important federal and state income tax, federal estate tax, and local property tax benefits that are available to donors of conservation easements.  Easements are usually a less expensive conservation approach than government acquisition, ownership, or land use regulation.

Conservation Easement in Micronesia

One conservation-minded family and a state agency in the small island of Kosrae State in Micronesia has just recently recorded the first conservation easement outside of the Americas and in a form that other Micronesian countries and even the United States could model.

Once a United States Trust Territory, Kosrae is one of three states that comprise the independent nation known as the Federated States of Micronesia (FSM). Its legal system is based on the United States legal system. Kosrae’s Attorney General issued an opinion that a conservation easement is a legally viable option for land protection in Kosrae, analogizing to legal principles established in the United States.

This particular conservation easement is designed to permanently protect a rare freshwater swamp forest comprised primarily of the ”ka” tree. The entire forest, named Yela, comprises approximately 400 acres and is the largest remaining ”ka” forest in the world. The undeveloped valley forest has been and will continue to be used for traditional harvests. Eels, nuts, wild pigs, and taro leaves for underground ovens or “ums” are gathered there. The easement will prevent development on the property.

The Yela deal is innovative not only because it introduces a new conservation tool to the region but it is “a new and improved” version of that tool from which states in the United States could benefit. Instead of the grantor who signs the easement sale agreement solely benefitting from the sale proceeds, as is often the case in the United States, the family in this case has invested that income into a trust fund managed by the Micronesia Conservation Trust and from which the family will derive payments over time.

The Kosraean conservation easement deal is being eyed by both Micronesians and other Pacific Islands because, unlike an outright government purchase of the land, the conservation easement model will accommodate the needs of traditional land uses and generational changes while compensating the owners for keeping the land in its natural state.

Conservation Easement in Chile

The largest and third ever conservation easement was recently created in Chile between The Nature Conservancy as the owner of the 123,000 acre Valdivian Coastal Reserve and Fundación de Conservación (FORECOS), a land trust in Chile. FORECOS will hold a conservation easement over nearly all of the acreage comprising the Valdivian Coastal Reserve, one of the world’s last temperate rainforests. To be enforceable under Chilean law, this easement is structured as an easement appurtenant. TNC will give FORECOS fee title to a small parcel of Valdivian acreage to serve as the ‘benefitted’ parcel of land which will be protected by a reciprocal easement held by the Conservancy.

The Reserve is one of the last intact temperate rainforests along the Valdivian Coastal Mountain Range. It is home to outstanding examples of endemic flora and fauna species, including two of the world’s longest living tree species, the alerce — which can live for more than 3,600 years — and the olivillo — which can live up to 400 years — as well as to numerous imperiled species of mammals, birds, reptiles, amphibians, and fish. The Reserve also contains an important marine coastal ecosystem of scrubland, coastal dune, sandy beaches and rocky coasts. In addition, there are eight river basins and five estuary systems within the Reserve that support numerous globally threatened species of plant and animal life.

At the same time that this easement was created, the Chilean Congress is continuing to consider the Derecho Real de Conservacion (DRC) legislation, which would establish a legal framework to enable the easier use of conservation easements in gross  for conservation in Chile (by removing the need for the appurtenancy requirement). The completion of this first Chilean conservation easement may encourage the enactment of the legislation. This legislation, along with a proposed Unified Donations Law that will provide tax incentives for conservation donations and make donating to conservation non-profits easier in Chile, has received strong backing from many community and political leaders in Chile.

Easements have also been used in conservation projects in Australia (there called “conservation covenants”), Canada, Guatemala, Costa Rica, and Mexico.  While these two most recent examples of conservation easements may differ in detail, they both represent the beginnings of what are likely to be increasingly noteworthy initiatives in countries other than the United States to find and develop new conservation tools to address the needs of both conservation and compatible community development.



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