Property Rights Foundation of America®

Carol W. LaGrasse, introductory articles excerpted from
Positions on Property, Vol. 5, No. 1, July 2000

Land Trusts Threaten Private Property
Conservation Easements
Easy Government Money—Future Problems

Where used to acquire large tracts of rural land, conservation easements are a wolf in sheep's clothing. Environmental groups, government, and even sectors of resource-based industry laud conservation easements as a permanent means by which to maintain "working" forests, ranches and farms while protecting the environment. In reality, however, the easements place the productive future of the land in grave doubt. At the same time, the easements are eroding that bastion of the American tradition of freedom, private property ownership.

The reasons cited to promote conservation easements are in error. Better means to preserve productive rural lands are available. It is important to avert any major government funding sources for conservation easements on large tracts of rural land and to pass legislation at the state and federal levels to put locally established caps on government land acquisition by either fee simple or conservation easement in any given municipality.

What are conservation easements? Under these transactions, the government or a land trust acquires a (usually perpetual) deeded conservation easement(1) which prohibits all but strictly limited forestry, agricultural, and possibly recreational uses of the property by the owner and gives the grantee, and sometimes citizen activists, certain powers to enforce the easement and manage the land. The forest, ranch, or farm "owner" actually becomes a residual owner under the terms of the easement, with his rights to use the land subsidiary to the rights conveyed, which can be very broad.

Benefits attributed to conservation easements—Inaccurate, exaggerated, and inequitable
The positive buzz about conservation easements and their one-sided advocacy by groups which stand to advance their agendas and increase their influence from implementing the easements have been obscuring rational evaluation of the ascribed benefits and negative effects of these transactions. This presentation briefly scrutinizes the values attributed to conservation easements.

THE MYTH OF PRIVATE CONSERVATION
Conservation easements arranged by land trusts are not "private" conservation.
Land trusts as government agencies:

The claim that conservation easements through land trusts are "private" conservation is false because the major regional and national land trusts are not private entities. Their funding and operations are so thoroughly woven together in complex monopolistic, often secret, relationships with government that they are essentially quasi-government agencies.

The favored interrelationships which land trusts enjoy with government include The Nature Conservancy's monopoly of the Natural Heritage program of wildlife mapping in every state of the Union; non-competitive land acquisition contracts, whether by easement or fee simple, commonly for a flip to government; sweetheart land deals where prices and expenses receive little scrutiny; non-competitive contracts to do maintenance of government nature preserves; provision of free government maintenance and improvements of land trust parks; and even sharing of personnel and office space.(2)

Furthermore, the use of conservation easements builds unwarranted financial and other interrelationships among land trusts, industry, and government, which is the opposite of privatization. The relationships, involving interdependency and favored status such as tax breaks and various cash infusions, erode competitive free enterprise and equal protections of representative government. When subject to normal public scrutiny these relationships are referred to in financial circles as "corporatism"(3). In analysis of failed governments in less developed countries, the extremes of these relationships, typically unscrutinized, are referred to as "cronyism."(4)

With the land trusts, the examples of cronyism seem less blatant, but consider this statement by Robert L. Bendick, Jr., who was then New York State Department of Environmental Conservation's Deputy Commissioner in charge of lands and natural resources, and managed land acquisition:

"Personal relationships are critical to the success of partnerships...The Nature Conservancy and the Trust for Public Land have systematized their relationships with state government..."

Mr. Bendick's succinct statement of unofficial New York State policy appeared in a chapter entitled "State and Local Partnerships" that he authored in Land Conservation Through Public Private Partnerships. (5) Mr. Bendick went on to be an official in The Nature Conservancy.
Land trusts as government land agents:
The land trusts are not mainly involved in private conservation. Instead, the land trusts are largely acquiring land on a prearranged flip to government, or else maintaining their holdings on the basis of the government's selective treatment of them with a 100 percent exemption from real estate taxes. In New York State, the pre-arrangement for one $2.6 million acquisition was made even without a source of funding.

The most powerful of the land trusts, and the wealthiest environmental organization in the world, is The Nature Conservancy. According to Ron Arnold, in his new book Undue Influence, the TNC proudly claims to own or hold conservation easements in 1,177,000 acres in its private preserve system. It states that it has protected 10.5 million acres in the United States. This leads to the conclusion that it has sold most of 9.3 million acres to the government.(6)

An alternative of genuine private sector conservation through land agreements
The real estate division of Sotheby's in New York has a program to preserve ranches in conjunction with the Sand Creek Co. in Buffalo, Wyoming, by offering cooperative ranch ownership to multiple wealthy buyers without the involvement of the government or land trusts. This commercial undertaking sells "ranch-steads" of 40-acre building lots for approximately $1 million each, along with membership in a ranch preservation association limited to the ranch-stead buyers. The ranch-steads are located to leave the large expanse of the ranch intact.(7)

CONSERVATION EASEMENTS
A THREAT TO PRIVATE PROPERTY

Both the actual, present structure of conservation easements and the long-term implications represent a threat to private property ownership. Contrary to the supposedly most compelling claim by the proponents of conservation easements, the easements do not, on balance, retain land in private hands.

Clouded Title:
Conservation easements sully the title to private property, negating centuries of real estate law to reduce the ability of property owners to use property in ways beneficial to people within our society. This fact was recognized when conservation easement law was passed in New York State. In order to enact conservation easement law in 1983, New York passed a statute(8) that specifically swept away centuries of common law that had protected property from such non-functional negative encumbrances, muddying of title interests, and open-ended parties to contracts.(9)

In his talk to the 1999 Wise Use Conference in Reno, Nevada, James Burling, senior counsel for the Pacific legal Foundation in Sacramento, California, explained how the new movement of conservation easements runs contrary to seven centuries of history of real property. He explained how, in spite of some temporary back steps, the movement has always been towards the free alienability of land. (10) This means that the centuries have brought the ability to acquire land outright without obligations to the king, nobles, or even the family. In the United States, Gray's Rule Against Perpetuities in 1886 limits ability of testators to control use of land for a period of time longer than the last life in being plus 21 years. There is a well-used expression in law, Mr. Burling points out, that the "dead hand cannot reach beyond the grave to control the living." He believes that, in view of the principles of property law, there are serious questions about the viability of conservation easements, which "destroy the economic utility of the underlying fee."(11)

Mr. Burling out that "conservation easements work by splitting an estate in real property into two or more parts and throwing one of those parts into the dustbin of history."(12)

The result—Loss of equity and rights to use the land:
After the land trusts, often acting as intermediaries, split the title, the remainder title owned by the farmer, rancher or forester ordinarily comprises only about ten to fifty percent of the equity of the property, depending on the practical feasibility of development of land in its unencumbered state and the range of the rights acquired in the easement. The bundle of private rights to the land has been so severely diminished that the farmer, rancher or forester is essentially a tenant on his own land.

When the land is depleted, as it will often deliberately be by such owners because they are unwilling to maintain their former stewardship; or when financial crises or opportunities arise necessitating the use of land for equity, where equity essentially no longer exists; or where times change and uses prohibited by the easement are feasible while permitted uses are undesired or uneconomical, the only buyer for the land may be government. Thus, the conservation easement is in essence a step along the way from 100 percent private to 100 percent government ownership.

(1) The federal government still provides the option under the U.S. Department of Agriculture's Wetlands Reserve Program for the purchase of 30-year easements rather than permanent easements. The landowner is paid 50 to 75 percent of the appraised value.
(2) LaGrasse, Carol W., The Property Owner's Experience, Property Rights Foundation of America, Inc., 1998. See chapters 14, 15, and 16. (Available from PRFA)
(3) Phelps, Edmund S., "The Global Crisis of Corporatism," The Wall Street Journal, March 25, 1999. In Corporatism, "private corporate interests are reconciled and coordinated by the central government," Columbia University Professor Phelps states.
(4) An extreme, therefore crystal clear, example of the crony relationships of business and government was reported by Peter Waldman and Jay Solomon in "How U.S. Companies And Suharto's Circle Electrified Indonesia—Power Deals That Cut In First Family and Friends Are Now Under Attack," The Wall Street Journal, Dec. 23, 1998, p. 1. The superior motives attributed to the land trusts are the main difference separating them from businesses with crony relationships with government; this may be solely a perceptual differentiation.
(5) Bendick, Robert L., Jr., "State and Local Partnerships," Land Conservation Through Public Private Partnerships, Lincoln Institute of Land Policy/Island Press 1991, pp. 164-165.
(6) Arnold, Ron, Undue Influence, Merril Press, Bellevue, Wash., 1999, p. 162.
(7) "Buffalo developers sell pieces of ranch ownership," Wyoming Livestock Roundup, May 16, 1998, p. 1. Eighteen forty-acre "ranch-steads," totaling 720 acres, would raise $18 million, leaving the great expanse of the 10,400-acre Waggonhead Ranch, 22 miles from Douglas, largely open for grazing.
(8) Environmental Conservation Law, Art. 49, Title 3; 49-0311, McKinney's Consolidated Laws of New York. See especially 49-0305, "Conservation easements; certain common law rules not applicable."
(9) New York's law furthers the interests of land trusts and invalidates common law impediments that might otherwise undermine the easements' validity. These key features are based on the Uniform Conservation Easement Act of 1981 of the National Conference of Commissioners on Uniform State Laws, Chicago, Illinois. A priority was to allow outside parties the right to sue to enforce the easement.
(10) Alienability is the ability to transfer property to the ownership of another.
(11) Burling, James, Pacific Legal Foundation, "Conservation Easements," Comments at the Wise Use Conference, Reno, Nevada, May 1999, pre-publication copy, p. 6.
(12) Burling, ibid., p. 1

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