We partner with local landowners to develop sustainable conservation solutions that benefit families and wildlife alike. Wondering about your options for protecting your land? If so, we’re here to help.

The conservation easement is one of the most effective conservation tools for helping private landowners preserve their land. This allows the owner to retain title and management of his or her land, while designating how the land will be used now and in the future.

A conservation easement is a complex legal agreement that is customized for your property and your vision for its future. We can help you understand the benefits and drawbacks of this option, so that you can determine if a conservation easement is the right solution for you.

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Frequently Asked Questions about Protecting Your Land with a Conservation Easement

A conservation easement is a voluntary land protection agreement between a private landowner and a land trust such as ESLT. It permanently protects the unique resources and conservation values found on a property – such as its scenic, wildlife, agricultural, ecological, or recreational qualities.

A conservation easement allows the owner to retain title and management of his or her land, while designating how the land will be used now and in the future. Every easement is different, customized to the specific needs and desires of the landowner. But practically and legally, easements typically restrict certain land developments, such as subdivision for residential or commercial activities, industrial uses, and surface mining.

Conservation easements must accomplish at least one of these three conservation purposes:

  1. Protection of open space (including farmland, ranchland and forestland)
  2. Protection of a relatively natural habitat for fish, wildlife or plants, or a similar ecosystem
  3. Preservation of lands for education or outdoor recreation of the general public

A conservation easement is an extension of private property rights, and can be a valuable tool for private landowners who want to retain ownership of their property. Once in place, the conservation easement guarantees that the land’s conservation values will be protected forever, even with a change in ownership. The easement is recorded as part of the property deed and public record.

As the landowner’s conservation partner, ESLT is legally obligated to monitor the easement by making annual inspections to ensure that the terms of the easement are being upheld. Learn more about monitoring and stewardship on protected lands.

Creating a conservation easement is both a personal decision and a financial one. The option to place conservation easements on private land is an important private property right that comes with land ownership in the United States. It is a voluntary tool that landowners have at their disposal—one that can help them fulfill their vision for the future of their land.

Conservation easements are designed to meet the site-specific needs of the individual landowner and land trust. They may not, however, be appropriate for every situation.

Landowners considering an easement should consult with family members, professional tax and legal advisors, and a land trust representative to determine whether this tool will help accomplish a landowner’s long-term conservation and economic goals.

With a conservation easement, the landowner retains ownership of the land, as well as other private property rights. Public access is not necessarily required.

As part of a conservation easement, a landowner may give up certain development rights associated with their property – such as the right to develop or subdivide. These rights given up through a conservation easement transaction are considered extinguished and can never be used, sold, or transferred.

It is important to note that under the terms of a conservation easement the landowner continues to manage and pay property taxes on the property. The landowner and his or her family can continue to live on and enjoy the property, and may still use it to produce crops, hay, livestock, timber, and other commodities. The landowner can still sell the property or pass it on to family or friends.

Landowners may choose to donate a conservation easement on their property. With this conservation option, landowners donate the full appraised value of the conservation easement, and they are compensated through federal tax incentives.

In some cases, it is possible for ESLT to purchase a portion of the easement from a landowner. ESLT will generally only purchase easements in high-priority locations where circumstances are such that a landowner cannot use the tax benefits of a donated easement and where funds can be identified and secured for the purchase. Funding to purchase conservation easements is limited.

A “bargain sale” conservation easement is a type of purchased conservation easement that employs both a purchase and a donation component. Landowners are paid in cash for the purchased portion and compensated through tax incentives for the donated portion.

Landowners who donate a conservation easement on their property may be eligible for federal income tax and estate tax benefits. The easement restricts commercial, industrial, and residential subdivision development of the property, so in a practical sense the land’s market value is diminished with the easement. Since that market value is voluntarily diminished – and for public benefit – the landowner may receive potential tax benefits.

After donating a conservation easement on their land, landowners often can more easily afford to pass the property on to their children and grandchildren. Such a tax reduction can make a critical difference in the ability of heirs to keep the land in their family.

To read more about tax benefit eligibility, scroll down to read, “Does every donated conservation easement qualify for an income tax deduction?”

In rare instances where a purchased or bargain sale conservation easement is an option, ESLT is able to compensate landowners for a portion of the development rights extinguished with a conservation easement.

In short, no. To qualify as a charitable contribution, conservation easement donations must:

  1. Be perpetual
  2. Be donated to a qualified organization (a public agency or nonprofit land trust, such as ESLT)
  3. Meet one of the “conservation purposes” tests outlined in the Internal Revenue Code, below.

The Internal Revenue Service Code Section 170(h) requires that conservation easement donations meet one or more of the following conservation purposes:

  • Protects relatively natural habitats of fish, wildlife or plants
  • Preserves open space – including farms, ranches or forests – either for scenic enjoyment or in keeping with a clearly delineated public policy
  • Preserves land for public outdoor recreation or education
  • Preserves historically important land or certified historic structures

Each conservation easement must meet one, but not all, of these recognized purposes.

If a conservation easement is voluntarily donated to ESLT, and if it benefits the public by permanently protecting important conservation resources, it can qualify as a charitable tax deduction on the donor’s federal income tax return. The federal tax incentive for conservation easements allows a landowner to deduct the easement’s value up to fifty (50) percent of his/her adjusted gross income, with a fifteen (15) year carry-forward period. Qualified farmers and ranchers are allowed to deduct the easement’s value up to one hundred (100) percent of their adjusted gross income with a fifteen (15) year carry-forward period.

A conservation easement will typically reduce the value of a property between 25% and 45%, depending on the terms of the conservation easement, surrounding land uses, and size and location of the property. This is because a conservation easement agreement usually includes the sale or donation of the property’s development rights, which are then extinguished when the agreement is finalized.

After signing a conservation easement, ESLT and the landowner begin a working partnership to ensure that the terms of the conservation easement are upheld.

The landowner retains all rights of property ownership not restricted by the conservation easement. ESLT has no ownership in the property, nor any right or responsibility to manage the land or pay its taxes.

Once a conservation easement is granted, ESLT assumes responsibility for enforcing its terms. This includes annual monitoring visits to the property by a member of ESLT’s land stewardship staff, which is only done after confirming an appropriate time and date with the landowner. Additionally, before undertaking any land use activity that may interfere with the conservation values protected by the easement, the landowner must give ESLT proper notice and/or receive ESLT’s approval first.

After an easement is granted, our staff is always available for consultation on land management practices. We can assist you in planning your short- or long-term property stewardship goals and provide information and resources on a wide array of land management issues.

In rare instances, ESLT is able to secure funding to complete important wildlife habitat restoration projects on a property that is under conservation easement. This would only be completed with the permission of the landowner, and he or she would be a leading partner on any such project. For an example of this, we encourage you to read about our ongoing restoration work at Benton Hot Springs Ranch.

A conservation easement may reduce estate taxes paid by heirs. This can make a critical difference in the ability of heirs to keep the land in their family.

Future landowners, including family members, must abide by the terms of the conservation easement. ESLT will continue our partnership with the property owner, regardless of who assumes ownership.

Families should consider the trade-off between the immediate tax benefits resulting from reduced property value and the permanent restrictions on land use that result from a conservation easement. Professional legal and tax assistance is recommended for families considering this evaluation.

A qualified appraisal will determine the value of the property both before and after the conservation easement is in place. The value of the easement is the difference between these two figures.

For purchased conservation easements, the cost of the appraisal is negotiated between ESLT and the landowner. In the case of donated conservation easements, landowners are expected to pay for the cost of the appraisal.

An important note regarding appraisals for conservation easement donations:
For tax deductions on conservation easements worth more than $5,000, landowners must obtain a specialized conservation easement appraisal to substantiate their deduction. Landowners should consult a professional appraiser who has direct experience with charitable gifts or conservation easements to ensure compliance with federal law. Appraisals need to be done with care by a certified appraiser who is familiar with local real estate conditions and with the particular type of land use in question. The IRS will review the appraisal document.

Landowners donating a conservation easement pay for their own legal and tax advice, appraisal, and escrow transaction costs. Additionally, ESLT maintains a stewardship fund to pay costs associated with monitoring and protecting easements in perpetuity. Landowners are asked to make a Stewardship Donation to cover these costs. The Stewardship Donation, along with other easement costs, may be tax-deductible.

Conservation easements limit the number, size, location, and type of dwellings and other buildings, and also limit or prohibit subdivision. Flexible in design, they may allow for future construction or subdivision – provided these do not impair the conservation values that the easement protects. These “reserved rights” are negotiated between the landowner and ESLT before a conservation easement project begins.

Any amount! A conservation easement may apply to a certain portion of an owner’s land, or to all of it – depending upon what the owner wants to protect and whether the easements and restrictions are acceptable to ESLT. Any property of value for agriculture, forestry, recreation, water resources, wildlife habitat, scenic, cultural, or historic qualities may be protected by means of a conservation easement.

As a practical matter, the smaller the parcel the less likely that it will have significant conservation values that warrant placing a conservation easement on it.

Yes, property with a conservation easement can be bought, sold, leased, and inherited. The conservation easement is tied to the land and binds all present and future owners and lessees to its terms and restrictions.

A combination of generous state, federal, and private grants allows us to purchase conservation easements and ensure that land is protected for the long-term. A significant portion of our conservation easement program is made possible by the USDA Natural Resources Conservation Service, California Deer Association, California Wildlife Conservation Board, and California Department of Conservation. ESLT writes grant applications for funding from these agencies each year for priority conservation easement purchases and bargain sales.

There are three main reasons why conservation easements are designed to last forever.

First, landowners generally want assurances that their property will be protected not just through their lifetime, but for future generations as well.

Second, federal law requires that the conservation easement be held in perpetuity in order for the landowner to qualify for federal income tax and estate tax benefits.

Third, there is a concern that if conservation easements were allowed for terms – say, twenty years or one hundred years – landowners could be tempted to receive the federal tax deductions for decades while speculating on lands that are rising in value. Then they could subdivide that same property later, after the term of the conservation easement expires.

No. Recreational access for the public is not legally required by state or federal laws that enable conservation easements. The decision of whether or not there is public access is determined by each private landowner.

Other than providing the statutory context that identifies conservation easements as real, transferable property rights, these transactions usually occur as private agreements between property owners and qualified, private, non-governmental organizations such as ESLT.

When conservation easements are purchased using state or federal government funds, the funding agency will sometimes be involved in drafting the easement terms and having final approval of the appraisal and easement before recording. The Internal Revenue Service becomes involved if the donor seeks tax and estate benefits for a charitable gift.

This is a complicated issue that should be discussed with professional advisors. However, a landowner who does not own the mineral rights to his or her property can qualify for income or estate tax benefits if:

  • Ownership of the mineral rights has been separated from the land and remains separated today; and
  • The owner proves that the probability of surface mining occurring on the property is “so remote as to be negligible.”

Because conservation easements qualifying under IRS regulations are designed to be permanent, landowners should assume that it would not be possible to revoke an easement.

On rare occasions, landowners have sought to amend the terms of a conservation easement. Amendments may be used either to strengthen existing conservation restrictions or to add additional acreage to the easement. Amendments to conservation easements are extremely rare and managed carefully to ensure conservation goals are met and that there is no private financial benefit to the landowner.

In order for a donated conservation easement to qualify for an income tax deduction, the landowner must acquire a mortgage subordination agreement from the mortgage holder (often a bank). With this document, the mortgage holder agrees to follow the terms of the conservation easement in the event of foreclosure.

All owners of a property must agree to the terms of the conservation easement before it can be recorded.

Yes. That said, the landowner should contact ESLT before conveying the easement by will to ensure that ESLT will accept the donation.

If the easement qualifies under federal tax law, its value is subtracted from the landowner’s taxable estate, reducing estate taxes for heirs. Also under federal law, the executor or heirs of an estate can donate a qualified easement after the death of the landowner, even if the landowner’s will does not donate an easement.

A landowner who might want their executor or heirs to be able to make this donation should clarify their intent by stating in their will that the executor or heirs have this power.