Each decision to conserve a property is a personal one. It involves the landowner’s financial and tax circumstances, the land resource itself, and most importantly, the owner’s vision for the future of that land. Because every situation is unique, the Franklin County Forest and Farmland Conservancy, Inc. offers several different means of conserving those productive, scenic, historic and environmentally important lands that give Franklin County and its communities their rural, historic character. Productive farmland, orchards, forests, floodplains, wetlands, unique geological features, wildlife habitat, and historic land and buildings which make important contributions to the character and fabric of Franklin County’s countryside will be eligible for consideration from among a number of land conservation options.

For landowners who share the goals of the Conservancy, the operations described here may provide a means to achieve a personal dream -- that of forever protecting an important part of the landscape. Some of these conservation techniques involve Conservancy costs and long-term stewardship costs. How these costs are covered varies based on individual land conservation project circumstances.

The conservation easement is the most widely used land protection tool available to landowners. Donating a conservation easement protects the land permanently, yet keeps it in private ownership. Easements are flexible and easily tailored to meet a landowner’s specific needs and the protection of the important resources of the property. As part of giving a conservation easement, the landowner, working with the Conservancy, identifies specific permitted uses of the property. These normally include agriculture, forestry, recreation, and other open space uses. The easement, through covenants and restrictions, limits or prohibits certain activities, including industrial, commercial, and extensive residential development.

Conservation easements are designed to conserve forever the important resource values of each property. An easement may cover portions of a property or the entire parcel. It is legally binding on all future owners as part of the chain of title to the property and will be monitored and enforced by the Conservancy. Conservation easements may include historic preservation provisions to protect important historic building architecture and/or historic site features.

The donation of a conservation easement to the Conservancy normally qualifies as a charitable contribution, which may entitle the donor to a charitable Federal income tax deduction for the easement’s value. The value of this type of charitable gift is based on the “before” and “after” appraisals - the first assessing the land’s value before the conservation easement is in place, the second assessing its value afterwards. The difference between the two appraisals is considered the value of the conservation easement.

An outright gift of land for conservation is one of the most generous legacies a landowner can make to future generations. Throughout Pennsylvania, there are parks, natural areas, forestlands, stream valley greenways and scenic open spaces that the public enjoys because of the long-term vision of conservation-minded landowners.

 Donating land can have many benefits for a landowner. It can be a relatively simple and quick transaction that:

• assures the permanent protection of a family property;

• provides a charitable income tax deduction for the full fair market value of the land;

• avoids capital gains taxes on appreciated land, which otherwise would be due at the time of a sale;

• removes the property from the donor’s taxable estate;

• relieves the donor of the expense and the responsibility of managing the land; and

• provides long-term support for the Conservancy.

The Conservancy recognizes that, in most cases, private owners are the best long-term managers of land. Therefore, when the Conservancy receives a gift of land with conservation value, it will often place a permanent conservation easement on the property and sell the land subject to the easement. The Conservancy will then use the proceeds to protect other conservation lands throughout Franklin County. In cases where land provides important public benefit, the Conservancy may retain ownership and management responsibility as a Nature Reserve, Nature Sanctuary, or Greenway or may convey the gifted property to a government agency; to ensure that the public will own and enjoy the property for the long term.

A landowner can donate land and continue to live on it during his or her lifetime. This is known as a gift of remainder interest, or a gift of land with a reserved life estate.

With a gift of a remainder interest, the donors and their beneficiaries reserve the right to continue to live on and continue to use the property during their lifetimes. At the end of the specified life interests, full title and control of the property automatically transfers to the Conservancy. In many cases, the Conservancy will resell the land, subject to a permanent conservation easement. Thus, the final outcome is very similar to that of an outright gift of land.

The donation of a remainder interest offers several advantages:

• the donors continue to use and enjoy the property throughout their lifetimes;

• the property is permanently conserved;

• the donor may be entitled to an income tax deduction when the gift is made, if the property is a personal residence, farm, or land having conservation value; and

• the proceeds from the sale of the property will support the Conservancy’s countywide land conservation program after the life interests conclude.

 Many landowners wish to retain maximum flexibility during their lifetimes and choose to carry out their conservation plans through a bequest or a living trust. Landowners can conserve important lands by donating property or donating a conservation easement through their Wills.

 A bequest is a provision in the landowner’s Will or a codicil (a Will amendment) that instructs the estate’s executor to convey land or a conservation easement to the Conservancy. A living trust can achieve the same results but avoids the probate process.

Both the bequest and the living trust can assure the permanent protection of the land, permit the donor to control the property during his/her lifetime, and may reduce the donor’s taxable estate. In either case, the terms of an easement can be developed through discussions between the landowner and the Conservancy to achieve the goals of both.

 The Conservancy may purchase conservation easements primarily in areas that are identified by the Conservancy as being necessary to buffer existing municipalities through the development of informal growth boundaries. Private contributions and/or public grants make these purchases possible. The Conservancy does not have a formal application process for easement purchase and will do most purchasing on a proactive, selective basis.

 A two-step appraisal process determines the purchase price of the easement. The property is valued before and after the land is restricted. The difference between these appraisals is the value of the conservation easement.

Another approach with advantages to both the landowner and the Conservancy is a bargain-purchase. The landowner sells a conservation easement or property to the Conservancy at less than full market value and donates the remaining value. For the landowner, this combines the income-producing aspects of an easement or land sale with the tax benefits of a donation. The difference between the fair market value (as determined by appraisal) and the actual sale price is treated as a charitable contribution and can significantly reduce any capital gains taxes payable on the sale. For the Conservancy, bargain purchases make land and easement purchases more affordable.

Occasionally, the Conservancy may be called upon to protect a property that has exceptional resource value of countrywide or regional significance. Such purchases depend on public grants and private fundraising capabilities. The Conservancy will infrequently retain ownership of the land for the long-term. In some cases, our role is to facilitate public ownership - we will convey properties to public agencies to be used as state wildlife areas and historic sites. Other lands may be sold to a private landowner subject to a conservation easement that permanently conserves the land’s resource values. In some circumstances, the Conservancy may also use this approach to preserve uniquely important farmland that is at risk of development. A purchase-easement-resale may be an important option to save key farms.

These two techniques provide for future land conservation:

• When the owner of an important conservation property cannot afford to donate or bargain-sell the property or a conservation easement to the Conservancy and is not ready to discuss a conservation plan, the owner might consider a right of first refusal. This right provides the Conservancy with the opportunity to match a purchase offer received by the owner at a future time if and when the owner elects to sell the property.

• An option agreement is a contract under which the owner offers the Conservancy a fixed period of time (normally a period of three to eighteen months) within which to make a decision to purchase either a conservation easement or the property outright. The Conservancy is not required to exercise its right to purchase but can, instead, use the option period to develop a conservation plan and seek funding sources to conserve the property. The option agreement either specifies a fixed purchase price or identifies a method - such as appraisal - by which the purchase price will be determined. An option can also provide for a bargain-sale of the easement or conservation property.

Donations:

All donations to the Franklin County Forest and Farmland Conservancy, Inc. may be sent to:

FCFFC
c/o Community Environmental Legal Defense Fund (CELDF)
675 Mower Road
Chambersburg, Pennsylvania 17201