Conserving Your Land: The Process Explained

Donating a Conservation Easement

A conservation easement project entails the following steps:

Initial Review
Decision Making
Resource Assessment and Easement Terms
Draft the Easement
Landowner Review
Appraisal and Subordination
Create Baseline Document
Closing Celebration
Stewardship

Initial Review
Tar River Land Conservancy will be glad to arrange a meeting with you to discuss your conservation options. Before the meeting, a landowner and his/her family should consider the following questions:

What are your conservation objectives for the property?
Do you want to reserve specific areas for future development?
Does your family support your long-term vision for the property?
Is your property being used as collateral for a loan?
How many people own the land?

You should bring all deeds, surveys, maps and other documents related to your property to the meeting. Tar River Land Conservancy staff members will review these items with you and discuss how a conservation easement can help you achieve your goals for the property. Our staff will also discuss with you the financial aspects of the project, including the tax benefits of an easement donation, the up-front costs associated with undertaking your conservation project, and a timetable for completion.

In many cases, a landowner will be asked to help cover a portion or all of the project costs. If a landowner is unable to pay these costs, TRLC will need to raise the necessary funding through grants and donor contributions. Each landowner will also be asked to make a contribution to Tar River Land Conservancy's Stewardship Endowment. Contributions to the endowment ensure that Tar River Land Conservancy has the resources to meet the perpetual stewardship obligations it assumes by placing an easement on your property.

Decision Making
The Landowner: A conservation easement has significant economic benefits and consequences for you and future landowners. Therefore, it is important to seek the counsel of your financial and legal advisors before embarking on a project. Remember, while Tar River Land Conservancy is available to answer any questions that you or your advisors have concerning the project, our staff cannot serve as your independent legal or financial advisor.

TRLC: Once staff has met with the landowner and both parties have come to some preliminary agreement on the direction a project will take, Tar River Land Conservancy's Board of Directors will review it for conformance with our project criteria and with other organizational goals and objectives.

Resource Assessment & Easement Terms
Prior to drafting your conservation easement document, our staff will conduct a detailed investigation of your property. During the investigation, they will identify the natural features and other important characteristics, such as significant historic structures, that exist on the property. This data will be used to draft the easement document so that it fully protects the conservation value of your land, and so that it fully explains the public benefits that will result from the conservation of the property.

Draft the Easement
Once Tar River Land Conservancy answers all your questions and you agree to work with us to conserve your property, we will create the first draft of a conservation easement document. In order to achieve your site-specific goals, we will again visit the property with you to verify its boundaries, map any areas of special concern (including areas to be excluded from the easement), and assess opportunities for special protections such as woodland river corridors. If your property has not been surveyed, if any boundaries are vague or poorly described, if the property is subject to a boundary-line dispute, or you are excluding a portion of the property from the easement, we will require a new survey from a licensed surveyor.

Landowner Review
Once Tar River Land Conservancy drafts an easement that meets both party's objectives, we will submit it to you and your advisor for comments and revisions. If you plan to use the tax benefits associated with the donation of a conservation easement, it may also be prudent at this stage in the project to consult with an appraiser to determine whether changes in the easement could help maximize the donation value associated with the project. Remember, the easement must meet all your specifications and concerns - this is your document and perpetual imprint on future uses of the land.

Appraisal and Subordination
Most people who donate an easement will want to claim a tax deduction and tax credit for their charitable gift. If you plan to do so, you must commission an appraisal. Our staff can provide information about Internal Revenue Service appraisal requirements and share a list of appraisers experienced at valuing conservation easements in our service area. Typically, a landowner will work with an appraiser after the easement has been drafted, but before the project has closed, in order to proactively maximize the value of the gift.

If you have used your property as collateral for a loan, you will need to obtain an agreement from the loan holder so that the easement is not extinguished in the event of a foreclosure. This is called a “subordination.” The loan holder will need to review the easement documents or the appraisal prior to subordinating its interests. Likewise, if you have a judgement against your property, the lien must be removed or cancelled before the easement can be closed.

Create Baseline Document
The Internal Revenue Service requires organizations receiving a donated conservation easement to maintain “documentation sufficient to establish the condition of the property at the time of the gift.” Likewise, the N.C. Tax Credit program requires this documentation in order to process your application. As a result, we require that you countersign a baseline documentation report. The report includes descriptions, maps and photographs, and is a record of the conditions and characteristics of the property at the time the easement was granted. In addition to conforming to the IRS and NC Tax Credit program requirements, this report also provides documentation that will aid future stewardship of the easement.

Closing Celebration
After the easement language has been finalized, the baseline document is done, and any required appraisals or subordinations are complete, you will be ready to 'close' on your land protection project. The closing will occur at the office of a local attorney. Landowners making a contribution to TRLC's stewardship endowment often chose to make their gift or sign a pledge at closing. Afterwards, the closing attorney will ensure that your conservation easement deed is recorded properly and that you receive the recording information.

If you choose to claim an income tax deduction, you must complete IRS Form 8283. Likewise, if you claim the NC Tax Credit, you will need to complete that program's forms.

Our best chance of saving the places we love is by word of mouth. If agreeable, TRLC may wish to share your commitment to conservation by issuing a press release about your project with local news outlets.

Stewardship and Compliance
The signing of the final conservation easement documents is just the beginning of Tar River Land Conservancy's relationship with you and your land. Tar River Land Conservancy staff will contact you at least annually to schedule visits to the property so that we can verify and document compliance with the easement terms. Owners of TRLC protected lands are encouraged to contact us if they have any questions about their easement terms and provisions. Likewise, landowner are encouraged to notify TRLC if the transfer of an easement property has occurred or is being planned.