Colorado Cattlemen's Association
We have listed many of the questions that we are asked on a daily basis. Please feel free to click on the question that concerns you the most, or just scroll down to view all of the questions that are asked about conservation easements. The questions have been separated into general, property management, and tax/financial questions. You can also visit our publications page that have a variety of materials that discusses the issues below in more detail. If you review this page and need additional information, please contact us.
CCALT strongly encourages all landowners to work with experienced advisors in law, tax, and estate planning.
What is a Land Trust?
A land trust is a nonprofit organization that, as all or part of its mission, actively works to conserve land by undertaking or assisting in land or conservation easement acquisition or by its stewardship of such land or easements. CCALT is one of 35 active land trusts in Colorado.
What is a conservation easement?
A conservation easement is a permanent restriction on some land uses, typically development and subdivision of a property. CCALT easements allow for and encourage traditional uses such as farming, ranching, hunting and fishing. Each easement is written specifically for each property and each landowner. An easement can provide flexibility in terms of reserved rights. An easement restricts development to the degree that is necessary to protect the significant conservation values of that particular property. Sometimes this totally prohibits new homes and/or divisions, and sometimes it doesn't. Landowners and land trusts, working together, can write conservation easements within federal and state guidelines that reflect both the landowner's desires and the need to protect conservation values.
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You want to see your land stay intact.
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Easements provide benefits to heirs and society in the form of working landscapes, wildlife habitat, scenic views, clean air and water.
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The financial numbers work to your advantage.
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It helps you meet your long-term goals for the property.
Why shouldn’t I do an easement?
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Easements limit potential future uses of the property – particularly development.
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Easements restrict heirs or future owners.
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Easements will lower the value of the property on the open market and/or it may take longer to sell.
How long does it take to put a conservation easement on my property?
It typically takes from six to nine months to complete the negotiations and supporting documents for a conservation easement. Planning in advance certainly pays off.
Can land trust staff come on my land whenever they want?
No. CCALT staff sets up an appointment with each landowner once a year to monitor their conservation easement. The time is mutually agreed upon by CCALT and the landowner.
Does CCALT own the property if I donate a conservation easement to them?
No, CCALT does not own the property. They only have an interest in the property and control those rights that the landowner wishes to restrict or eliminate (such as development rights). The landowner continues to own the property under the terms of the conservation easement.
How long does a conservation easement last?
Most easements "run with the land," binding the original owner and all subsequent owners to the easement's restrictions forever. Only gifts of perpetual easements can qualify for income and estate tax benefits. The easement is recorded at the county or town records office so that all future owners and lenders will learn about the restrictions when they obtain title reports.
Are there circumstances where CCALT would not accept a donated easement?
Yes. CCALT may decline to accept a conservation easement for many reasons. Reasons include, but are not limited to: the land is not an agricultural property; the Trust deems that the reserved rights or proposed development on the land will interfere with the preservation of the conservation values; it believes that the easement does not provide significant public benefit; if there are not documentable conservation values to meet IRS requirements, or if conservation is required for approval of a development. Please contact us for more information.
Who enforces an easement and how?
The Cattlemen’s Land Trust monitors each conservation property at least annually to ensure that the terms of the conservation easement are being met. If a violation of an easement occurs, it is the Land Trust’s obligation to ensure that the violation is corrected. The Land Trust has had no significant easement violations to date. Still, the Land Trust is prepared to defend all of its easements should a major violation or legal challenge occur. Towards this end, the Land Trust is building a dedicated stewardship fund of sufficient size to ensure that it is financially capable of stewarding its easements in perpetuity. The Land Trust operates its easement stewardship program in accordance with the Land Trust Alliance’s Standards and Practices.
Can an easement stop condemnation?
A conservation easement will not automatically prevent public condemnation. The government’s power of eminent domain will supersede any number of private covenants, easements or other legal devices. Having an interest in the property through a conservation easement, CCALT will partner with the landowner to fiercely oppose any government action that would damage the conservation values of the property.
What if ranching becomes uneconomical?
CCALT does not require the land to be in continuous agricultural production but to be simply available for agricultural production. While we prefer properties to be in agriculture, we understand that economics or family decisions come first.
Do I have to allow public access on my land?
No. You are not required to allow public access. Property protected by CCALT conservation easements remains in private ownership with access controlled by the landowner.
Is CCALT going to tell me what to do with my property?
No, CCALT is not in the land management business. We monitor conservation easements to ensure that the landowner is complying with the mutually agreed upon terms of the conservation easement. We expect that landowners will be good stewards of the natural resources of their properties as part of their agricultural operation.
What about oil and gas drilling?
Oil and gas development can occur on land covered by a conservation easement provided that such extraction is not accomplished by any surface mining method and the method of extraction has a limited, localized impact on the property. CCALT does have some properties with oil and gas production on them, and CCALT will look closely at any mineral issues surrounding a property before accepting an easement.
Can I sell my property if I put a conservation easement on it?
Yes, the landowner retains full ownership of their land. The property is sold with the conservation easement attached and the new landowner will be subject to the same restrictions as the landowner who initiated the easement. Many properties subject to CCALT conservation easements have sold in recent years.
What are the tax benefits associated with land protection?
Easements that are (1) permanent, (2) donated by the landowner (or a qualified bargain sale), and (3) provide one or more conservation values for public benefit typically qualify for tax benefits offered by the federal government and the State of Colorado. The two main tax benefits associated with a donated conservation easement are income tax benefits and estate tax benefits. An independent appraisal, conducted by a qualified appraiser, of the value of the easement determines the extent of the tax benefits. The amount and type of tax benefits depends on a variety of factors, including the legal tool you've used to protect your land, the value of the donation, your income level and the total amount of your estate. Again, you should consult with a financial advisor and/or an attorney to fully understand the tax implications.
To qualify for a deduction, the agreement must be properly structured and must provide significant benefit to the public by satisfying one or more recognized 'conservation purpose' as defined by Internal Revenue Code Section 170H. These are:
- the preservation of land areas for outdoor recreation by, or the education of, the general public
- the protection of a relatively natural habitat of fish, wildlife, or plants, or similar ecosystem
- the preservation of open space (including farmland and forest land) where such preservation is for
- the scenic enjoyment of the general public or pursuant to clearly delineated Federal, State or local government conservation policy and will yield a significant public benefit
- and the preservation of an historically important land area or a certified historic structure.
How is the value of a donated easement determined?
Only a qualified real estate appraiser can determine the value of an easement donation for tax purposes. The appraiser will consider the property's “before” value on the open market -- under current zoning -- and its “after” value with an easement restrictions on it. The difference between these two figures is the value of the easement.
Will my property taxes be affected?
No. If land is currently assessed at the agricultural rate in Colorado, it will continue to be taxed in the same way, thus preserving important local services paid by property taxes.
What are the costs associated with donating a conservation easement?
There are costs associated with putting a conservation easement on a property. Each conservation easement requires a report documenting the existing natural resources and human activity on the property (baseline report), a minerals remoteness assessment if the landowner does not own all the mineral rights, title-work, verification of legal description, land trust costs and endowment and recording fees. Landowners are also responsible for costs to conduct an appraisal as well as attorney or accountant fees. These fees typically total $25,000 to $40,000.
Can I really find someone to buy state tax credits?
Yes – Since the credit has been in effect, every landowner CCALT has worked with has found a buyer for their credit. There are several reputable brokers who match easement donors with buyers of tax credits. You can find a list of tax credit brokers on our landowner information page.