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WHAT MATTERS:
A GUIDE FOR
LAND TRUST
BOARD MEMBERS
by Henrie a Jordan
October 2014
This edition of Protecting What Matters is an ADVANCE COPY of a booklet that will be
published in 2015. It is being distributed by the author, Henrietta Jordan, and in its present form,
is not an official publication of The Land Trust Alliance or any other organization with whom
the author is affiliated. Reader comments are welcome and should be directed via email to
hbjordan@trailmarker.org or communicated directly to Henri Jordan at 518-576-2079. Please do
not copy this publication without permission.
The trust in land trust. Land trusts often work in partnership with landowners who
love their land and want it preserved forever. It might be a Vermont farm thats been worked by
one family for generations. Or a 380-acre redwood forest in California two sisters donated so that
their grandfathers home and lands would become a wildlife preserve instead of a development.
Or a spectacular rocky coastline that would otherwise have become dotted with Mc-mansions.
Landowners donate land and conservation easements restricting future development to land
trusts because they believe that land trusts will deliver on their promise to protect it from harmful
development, future owners who dont understand its environmental value, and those who would
exploit and sacrifice its natural resources.
Creating a legacy of conserved land and connecting people to the land and to each other
is your opportunity to give your community a gift of incalculable value. Your land trust has
pledged to protect important lands in perpetuity. Your diligence as a board member will ensure
that your land trusts intention enduresforeverand that future generations live in a world
with unspoiled natural areas, places to play and relax, thriving farms, healthy rivers and streams,
and habitats large enough to sustain species that might otherwise be threatened with extinction.
But for conserved lands to stay protected, land trusts need board members who make sure
that their organizations comply with laws and regulations, observe the highest standards of
ethics, engage in sound transactions, and perform the stewardship tasks necessary to uphold the
promise of perpetuity.
During your service as a land trust board member, youll learn a great deal about all of
these matters, but at first, you may find discussions about things like easements, baselines,
title reports and Section 170(h) rather confusing. This introductory guide is intended to make
your first months on your board a little easier and give you a solid foundation for the knowledge
and expertise youll be gaining over time.
Land trusts need active and diligent board members. Nonprofit board members have
three core duties. The duty of care requires that when you make decisions and take action, you
keep in mind that you are the steward of the organizations assets (including its reputation) and
always act with the care that an ordinarily prudent person would exercise in a like position and
under similar circumstances. This means that you read reports and other information sent to you
in advance of board meetings, that you attend meetings regularly, and that you and other board
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members deliberate before making decisions. It also means that you help build a strong,
sustainable organization by assisting in the recruitment and training of knowledgeable and
effective board members and raising funds.
The duty of loyalty requires that you give your undivided allegiance to your organization
when making decisions or taking actions that affect it. You must disclose and your land trust
must manage conflicts of interest so that you do not use information you learned as a board
member for personal gain or participate in a transaction in which you or members of your family
have a financial interest.
The duty of obedience requires you to be faithful to your organizations mission and
never act in a way that is inconsistent with its goals, bylaws, and policies. Importantly, this duty
also requires you to manage contributions to the land trust so that they serve the organizations
mission and the donors intent, abide by all applicable laws, and observe the highest standards of
ethics. Some states have actually enshrined these three duties in state laws or regulations.
Your role in the governance of your land trust also requires you to make sure that land
and conservation easement transactions are thoughtfully and competently executed, and that the
land trust exercises careful stewardship of the lands it has conserved. Because land trusts need to
know about real estate and tax law as well as protecting natural resources, the responsibilities of
land trust board members can be more demanding than those of other nonprofits, especially
when the land trust is all-volunteer.
Recruiting board members with expertise and experience in law, accounting,
environmental science, real estate, communications, education, or fundraising is a great strategy
for ensuring that the board can effectively oversee the work of the land trust and ensure that it
meets legal requirements. For an all-volunteer land or minimally-staffed land trust, this is
essential.
make sure it is never developed. Or perhaps the donor wants to be sure there is always a public
trail to a special place, like a waterfall or pond. Other times, a donor gives land to a land trust
with the express intention that it be sold and the proceeds used to help the land trust in other
ways; such lands are commonly referred to as tradelands.
Conservation easements. When a land trust accepts a conservation easement, however, it
does not acquire fee title, and it does not own the land. A conservation easement is a voluntary
legal agreement in which a landowner agrees to forever relinquish some or all of the
development rights on his or her land. The rights dont get transferredthe conservation
easement effectively extinguishes them and gives the holder of the easement the right to
enforce the terms of the easement, which severely restrict how the landowner can use the land in
the future. But the landowner can still sell the property, bequeath it to heirs, and conduct any
activity on it that is not prohibited by the easement. The easement will run with the land, that
is, bind all future owners.
Conservation easements are often placed on privately-owned land, and the landowner is
generally not obligated to grant public access. But sometimes land trusts hold conservation
easements on lands that are owned by a government agency or another non-profit (including
another land trust). These lands are more likely to be open to the public.
Easements can be purchased or donated. The donation of an easement usually lowers the
economic value of the land, but private landowners may enjoy significant tax benefits that offset
part of that loss. But most landowners who donate a conservation easement to a land trust do so
not because of the tax benefits but because they love their land and they want to protect it for
future generations.
A conservation easement may allow some flexibility in future uses of the land. For
example, land trusts may agree to allow a landowner to build an additional house or barn in a
designated area, or cut trees for firewood, provided that these uses dont impair conservation
values. That is one of the reasons they appeal to landowners, particularly those who hope that the
protected land remains in the family.
When a land trust accepts a conservation easement, it also accepts the duty to enforce the
terms of that easement.
Other ways to protect land. Some land trusts hold neither easements nor fee lands. They
exist to help other organizations or governmental agencies acquire conservation lands. They
might hold a property for a short while before transferring it or they might just help with
fundraising or other aspects of the transaction.
Its all about permanence. Conservation easements are generally perpetualeasements
that only last a few years or decades do not qualify for tax benefits and would require a land trust
to invest time, energy, and money in lands that are not fully protected from development. And
when land trusts acquire conservation lands in fee, they usually do so with the intention of
protecting them permanently.
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DOING IT RIGHT
Protecting the lands that matter. The first thing a land trust needs to consider when
presented with an opportunity to hold a conservation easement or acquire a fee property is, Why
is it important to preserve this land? To help answer this question, many land trusts develop
project selection criteria. These generally focus on certain natural resources the land trust is
especially interested in, such as wetlands, riparian areas, habitat, prime agricultural soils, scenic
vistas, or landscapes that help define a communitys character, such as undeveloped ridgelines or
open lands between developed areas. If the project does not contain a critical mass of the natural
resources the land trust seeks to protect, the land trust will likely turn it down.
Selection criteria should also take into account factors that might impede a conservation
projects success. If, for example, the property would be too time-consuming or too expensive to
steward, or there are unavoidable threats, such as nearby development, to the projects goals, or
there are hazardous wastes, then the land trust would probably not want to proceed with the
project. Many land trusts refine their selection criteria by developing a strategic conservation
plan that analyzes the unprotected and/or under-utilized lands in the area where the organization
works, considers the land trusts mission, values, and goals, and establishes priorities.
Due diligence is an important land trust responsibility. A land trust that purchases or
accepts a donation of land or an easement will be spending time, energy, and money before and
after the transaction, and its important to make sure that each acquisition truly merits the land
trusts investment. An in-person inspection of the property is necessary to confirm the presence
of natural resources and other attributes worth protecting (often called conservation values)
and to confirm that conserving it truly benefits the public in some way.
Public benefits might include the preservation of open space, the protection of prime
agricultural soils, the improvement of water quality, the preservation of important habitat,
opportunities for education and/or recreation, the creation of community gardens, or the
preservation of an historically significant property. Most land trusts have a procedure for
documenting the conservation values and public benefits of a conservation project they are
working on.
Its also important to confirm that the landowner has clear title to the property. Without
good title, the deed the landowner gives for the conservation easement or conveyance of the
property in fee will have no effect, and the land trust will have invested its resources futilely.
Land trusts should always get a title opinion; some also purchase title insurance to protect their
interests. If there is a mortgage on the property, the land trust will need to get the bank holding
the mortgage to sign a document called a mortgage subordination to protect the land trusts
interest in the event of foreclosure.
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Researching the history of the property is an essential element of due diligence. How was
the land used in the past? Is there any chance that hazardous substances were dumped on it? Are
there archeologically significant sites on the property, such as Native American burial grounds,
that might need special protection? Are there structures such as dams or old mines that might
require large expenditures in the future? Its vitally important that a land trust know exactly what
it is getting when it acquires a fee property or a conservation easement.
Legally sound transactions. Conveyances of fee title and conservation easements are
documented by means of a recorded deed. A deed conveying fee title must be signed by the
landowner (grantor), and a conservation easement deed must be signed by both the grantor and
a representative of the grantee, the land trust or other entity that will hold the easement. The
requirements for legally valid conservation easement deeds are dictated by state law and, if the
grantor will be taking a tax deduction, the Internal Revenue Code. Most land trusts have their
easement deeds drafted or at least reviewed by an attorney to make sure that they meet the
requirements.
BDR is the cornerstone of the land trusts proof that a violation did, in fact, occur.
Some land trusts record their BDRs with the register of deeds, but in most jurisdictions,
this is not necessary. Whether or not a BDR is recorded, it should be carefully protected as an
irreplaceable, original document essential to the defense of the easement.
Some land trusts prepare baseline documentation reports for their fee properties as well
as their easements. These are not necessary for tax or enforcement purposes, but they provide a
useful inventory of natural resources and other characteristics of the propertyan excellent
foundation for the creation of a property management plan.
appraisal and making sure that the Form 8283 is properly filled out. Your land trust should have
someone on its board or staff who understands how to review landowner appraisals and Forms
8283 and confirm that they meet certain basic requirements of the tax code before signing the
form.
In addition to the federal tax deduction, there are, in some states, tax deductions and/or
tax credits available to donors of conservation easements. In a few states, tax credits are
transferable; that is, the donor can sell them to another taxpayer. This is especially beneficial to
donors whose incomes are not high enough to get a significant deduction.
If the easement has been violateda building constructed where none is allowed, or the
removal of vegetation that was supposed to be untouched, for examplethe land trust must act
to enforce the easement. Small violations like dumping brush are usually remedied after the land
trust brings them to the landowners attention, but more egregious ones may require extensive
remediation and/or legal action. Many land trusts have detailed policies and procedures for
responding to violations and resolving them.
Funding stewardship needs over the long term. Even if a land trust uses volunteers to
monitor its fee lands and/or easements, it can incur significant expenses for stewardship and
legal defense. It is considered best practice to maintain substantial financial reserves for these
purposes.
The Land Trust Alliance recommends that a land trust holding easements maintain a
defense fund of at least $50,000 for its first 15 easements, add at least $1,500 to the defense fund
for each subsequent easement, and also maintain a stewardship fund containing at least $3,500
for each easement. For fee lands, the Alliance recommends that a land trust have a reserve fund
that will at least cover emergency needs and legal defense expenses and that it be able to raise
enough each year through investments, fundraising, or other reliable sources of revenue to cover
annual management expenses.
Many land trusts insure themselves against catastrophic legal expenses through the
TerraFirma conservation defense insurance program developed by the Land Trust Alliance. But
they should still maintain healthy stewardship and defense reserves.
Asking landowners for stewardship contributions. Most land trusts ask a landowner who
conveys a conservation easement to at least help out with stewardship and defense funding. This
sometimes surprises new board members. But consider this: as a land trust, you are pledging the
resources of your organization to protect the landowners property in perpetuity. For the
landowner who loves her land, this is a service of incalculable value, one that simply isnt
available from anyone else at any price. Doesnt it make sense that the landowner should pay
some of the costs of that service if she has the means to do so? Some landowners cant, of
course, in which case, your land trust will have to obtain the needed funds from other sources.
When landowners give fee property to a land trust, they are somewhat less likely to make
a stewardship contribution, but many dobecause they love their land and want to make sure
that it will be protected forever. Whenever a land trust receives a stewardship contribution, it
should take care to observe donor intent. If the landowner clearly intends the contribution for
stewardship, it should be classified as a temporarily restricted or permanently restricted
contribution and not used for any other purpose.
Dealing with change: amending conservation easements. Landand peoplechange
over time and sometimes it is advisable to amend a conservation easement to adapt to these
changes. For example, a landowner may want to locate a building permitted by an easement in a
location different from the one prescribed by the easement. Or she may want to add acreage to
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the easement. Or install a free-standing solar panel. These changes can be accommodated
through legally amending the easement, but the land trust should proceed cautiously.
Easement amendments should be consistent with the land trusts mission and the original
intent of the easement and have no net negative impact on conservation values. They cannot
confer impermissible private benefit or private inurement. That is, the landowner cannot enhance
the overall value of his property through an amendment without compensating for the
enhancement in some way, such as agreeing to add more land to the easement or remove a
previously-allowed building site.
Many land trusts have policies and procedures that guide them through the amendment
process and make sure that all amendments are legally and ethically executed.
Membership in the Land Trust Alliance is open to any land trust that adopts Land Trust
Standards and Practices (see below) and pays annual dues. Board members can also join as
individuals, and many do because of the numerous benefits the Alliance provides, not only to its
members, but to the land trust community as a whole.
Land Trust Standards and Practices. In 1989, representatives of the land trust community
joined with the Land Trust Alliance to develop ethical and technical guidelines for land trusts
and help them better develop the policies, procedures, and operating principles needed to protect
lands in perpetuity. Revised several times since then, Standards and Practices has become a
manual of practice for many land trusts in the United States. For more information, visit the Land
Trust Alliance Learning Center (www.learningcenter.lta.org)
Land Trust Accreditation. In 2006, the Land Trust Alliance created the Land Trust
Accreditation Commission, an independent program that accredits land trusts on the basis of
their compliance with the 26 (out of 88) practices of Land Trust Standards and Practices thought
to be most essential to excellence, trust, and permanence in land conservation. At this writing,
almost 300 land trusts have earned accreditation and many more are planning to do so in the next
few years.
Accreditation is an arduous process, requiring much documentation and many hours of
work, but most land trusts that have gone through it believe that it made them stronger and more
effective. The Land Trust Alliance has developed on-line courses and textbooks specifically
geared to land trusts seeking accreditation; these can be found on the Learning Center. For more
information about the accreditation process, see www.landtrustaccreditation.org.
For further learning. This short guide was written to give readers an introduction to the
work of nonprofit land trusts. It is not intended as a comprehensive manual; nor is it intended to
covey legal or tax advice.
By now you may be thinking, Operating a land trust is a pretty complicated job! Indeed
it is, but keep in mind that thousands of people like you have taken on this rewarding work and
made lasting contributions to their communities and future generations.
As you grow in your role as a board member and land conservationist, you will want to
take advantage of the wealth of learning opportunities available to you through the Land Trust
Alliance, many of which you can access online. There are also independent associations of land
trusts in many states; these offer publications, training conferences, and opportunities to network
with other organizations. Local community foundations, United Ways, and nonprofit
associations also offer webinars, workshops, and guides that will help you not just in your role as
a land trust board member but in your work with other nonprofits.
Your journey has just begunand it is bound to be an exciting and satisfying one. Thank
you for volunteering for the great cause of land protection and helping to build better
communities and a healthier, more sustainable planet for everyone.
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