Land Trust Alliance

Trustees Win Lawsuit Brought by Neighbor

Kimberly Seese — 2010-11-17T00:00:00Z

A Massachusetts court dismissed a neighbor lawsuit to enforce a conservation easement, joining New Hampshire’s Tallman decision in a string of third party enforcement cases denied on lack of standing. These cases establish the land trust right to enforce. Neighbor objections often do not support any general public benefit.

Court Action

The Massachusetts Land Court dismissed a law suit against The Trustees of Reservations (MA) brought by a neighbor to enforce a conservation restriction (Massachusetts name for conservation easement). The Court entered a final judgment ruling that the neighbor had no standing to enforce the conservation restriction.

“This case required a large investment in time by our staff and outside legal counsel,” explained Chris Rodstrom, Director of the Conservation Restriction Program at The Trustees of Reservations, “but by prevailing we’re now in a stronger position to deal with any other abutters to our 340 conservation restrictions that attempt to unduly influence our stewardship program.”

This decision has limited precedential value because it is a judgment in the Trial Court; nonetheless, it still is useful for any land trust dealing with a neighbor that is threatening a lawsuit. It may also have some value in other lower courts especially coupled with the Tallman decision to show how other courts have dealt with the issue.

Background

The owner of the conserved land granted the conservation restriction in 2008 to the Trustees. The restrictions provided for a building envelope, access and utilities on the 36 acre property in a spot where a home and barn had previously stood. A year later, the land owner proposed to dismantle an existing historic home it owned elsewhere in town and move it into the building envelope. The neighbors, Frank and Jean Granara, objected alleging that the access would have to be widened to accommodate moving the house and would disturb 978 feet of bordering vegetated wetlands. The access driveway abuts the rear boundary of the Granaras’ home on a small lot.

The Trustees had reviewed and approved the landowner plans as consistent with the purposes of the restrictions. The Granaras sued the landowner, Stetson Kindred of America, Inc. for violating the restrictions and the Trustees for failing to enforce the restritions. The Granaras claimed that they personally benefit from the restrictions on the Stetson property since it increases their property values and therefore they have the right to enforce the restrictions. The Trustees countered that the Granaras’ lacked standing to sue and to enforce the restrictions and that in any event the contemplated actions are consistent with the restrictions. On joint motion of the parties, the court considered two issues: whether Stetson’s activities violate the restrictions and whether the Granaras have standing to enforce the restrictions.

The court held for the Trustees on all counts finding that only named holders in the restrictions have any right to enforce them.

“It helped to have a good conservation restriction stewardship program in place,” added Chris Rodstrom, “since we could demonstrate to the judge that our approval of the building was carefully considered and well documented.”

Recent Related Case

Elizabeth Tallman filed a case, (Tallman v. Outhouse, et. al.) against her neighbors, Mr. and Mrs. Outhouse, the owners of abutting property partially protected by a conservation easement, the Rockingham County Conservation District (conservation easement grantee) and the Society for the Protection of New Hampshire Forests (executory interest holder in the conservation easement). Ms. Tallman claimed she had a third party right to enforce the easement, and that the Conservation District and the Forest Society were failing to enforce the terms. She also asserted a right of unfettered access to the protected property, which the Court rejected, upholding the landowners' right to post against and to control public access. Essentially, she sought a ruling that conservation easement prevented her neighbors from building their home on land not encumbered by the easement, and that the easement prevented access to the residence site. Elizabeth Tallman asked the Court to order that, among other things, the easement precluded the construction of the house and access to it, and that the conservation restrictions also extended to the excluded 1.23 acres as a result of an equitable servitude.

The neighbor’s legal positions required the easement holders to vigorously oppose the assertion that abutters have legal standing to interpret or enforce easements, or to restrict or utilize easement land for their personal goals. There were other related disputes at issue in the lawsuit, but the critical matter for the Forest Society, and for the land conservation community as a whole, was the whether abutters or other third parties can sue to enforce conservation easements granted to land trusts, municipalities and state agencies. The New Hampshire statute that authorizes conservation easements does not include an express statement that only the holders of a conservation easement have legal standing or a right to sue to enforce the easement.

This was essentially a dispute between neighbors that escalated to include both easement holders. One of the neighbors had very nice land subject to an existing conservation easement. The complaining abutter tried to use the easement as a sword for her personal purposes against the wishes, interpretation, and authority of the easement holders. Voluntary settlement attempts proved fruitless. The court ruled explicitly that New Hampshire recognizes no third party right of enforcement, and further that the Outhouses’ plan to build a house on the unrestricted portion of their land cannot be viewed in any way as a violation of the easement. The court also acknowledged that the Outhouse’s use of the historic access route that crossed a small potion of the easement land was not a violation of the easement.

The Court found for the defendants on all counts and also held that the easement did not require open access to the general public. This is what the Conservation District and Forest Society sought from the court and is a very good result for the NH land trust community.

Alliance Board Votes to Raise Four Million in Capital

Kimberly Seese — 2010-10-20T13:40:00Z

At its annual Rally meeting, the Alliance board voted to raise the necessary $4 million in start up capital from foundations and individuals to fund the proposed conservation defense insurance program. Your land trust still has time to join the over 450 land trusts from 47 states committed to the program. See who’s committed in your state.

“It is really exciting to see the land trust community come together on these important issues!” says Jesse Leddick, senior conservation associate of the Pacific Forest Trust (CA).

The three-year timeline for the proposed conservation defense insurance program, if successful and if the Alliance board continues to vote to proceed at each step, may have the proposed program starting in 2013.

If you know of someone that may be willing and able to give to this critical national conservation effort, please contact us.

Read testimonals from our land trust community about the proposed program.

Call or write to:
Leslie Ratley-Beach
Conservation Defense Director
Land Trust Alliance
44 Deerfield Drive
Montpelier, VT 05602
Phone and fax: 802-262-6051
E-mail: lrbeach@lta.org

Fannie and Freddie Propose Ban on Charitable Transfer Fees

Kimberly Seese — 2010-10-14T19:00:00Z

Thousands of organizations have protested the proposed elimination by the Federal Housing and Finance Agency (“FHFA”) of lending on any property that has a private transfer fee covenant. Many land trusts use such funds for stewardship, restoration and acquisition.

Working with the Realtors Association, FHFA, the parent agency of Fannie Mae and Freddie Mac, as well as the Federal Home Loan Banks, has issued a proposed guidance document for public comment that would effectively eliminate the use of all Private Transfer Fees (“PTFs”). If allowed to become effective, the rule removes a critical funding mechanism for conservation, affordable housing, and community infrastructure.

Congresswoman Maxine Waters and Co-Sponsors Sherman, Sires, and Gwen Moore introduced the Homeowner Equity Protection Act of 2010 to ban all private transfer fees. It is being portrayed as consumer protection from predatory scheme that forces homeowners to pay for the right to sell their own properties. It does not address charitable transfer fees, but the coalition is working with Waters to insert such language.

Many land trusts use transfer fees to fund, and often times fully fund, conservation easement stewardship. Land trusts are now more aware than ever that the actual costs of stewardship and legal defense are significant. Granting landowners are limited in their ability to pay to fully fund all stewardship and legal defense expenses for a conservation easement of fee donation. More land trusts are exploring transfer fees as an additional tool to help close this funding gap.

Many land trusts have been using a transfer fee for years, and therefore risk losing a potential long term source of stewardship and other funding. These fees properly used fund community programs and unique community benefits.

Realtors in several states have also been pursuing legislation to prohibit transfer fees at the state level. Such legislation has been successfully defeated (SC) or modified (NC, IL and CA). Other states have blanket prohibitions (TX, MO, FL and OR). Check your state law on this issue so you are not surprised in your state.

A coalition of concerned charitable organizations, government agencies and others is working on the issue. The Coalition is also working to insert exemptions for

any 501(c)(3) or 501(c)(4) organization
all transfer fees prior to January 1, 2011

View more information and a list of coalition members.The Alliance is working on this issue by informing its members, joining the coalition and calling supporters.

Developers and investors are securitizing transfer fees to generate long-term income streams for their private benefit. An example of this is Freehold Capital Partners of New York. This use of securitized PFTs angered home buyers and realtors.

The FHFA needs to hear from you. Request that the FHFA:

Insert an exception for tax-exempt organizations’ use of transfer fees;
Continue to support homes and homeowners with community-benefits fees;
Support reasonable Community-Benefits Fee Standards that distinguish between community-benefits fees (charitable purpose) and abusive fees that benefit only developers;
Allow communities to freely associate to support community services, schools, affordable housing, and conservation with no new taxes; and
At a minimum, extend the comment period through January 30, 2011, to allow for fully informed decision-making that fully considers the implications of the proposed harsh change.

Submit comments as follows:

Via E-mail: regcomments@fhfa.gov
Reference: “Guidance on Private Transfer Fee Covenants, (No. 2010-N-11)” – include this in the subject line.

Via Mail/Hand Delivery:
Address: Alfred M. Pollard
General Counsel, Federal Housing Finance Agency
Fourth Floor
1700 G Street, NW
Washington, DC 20552
Reference: “Guidance on Private Transfer Fee Covenants, (No. 2010-N-11)” – include this in the subject line.

Via Federal eRulemaking Portal:
Federal eRulemaking Portal: http://www.regulations.gov/search/Regs/home.html#documentDetail?R=0900006480b316f0

Ask your Members of Congress to write to FHFA to request both a comment extension and a charitable exemption.

Connect with your local affordable housing groups and government housing agencies. Ask them to write a letter to FHFA too.

Tell your land trust colleagues about this and share the talking points so everyone can take informed action.

Join the coalition. Click on the hotlink to submit your organization’s logo. Then click on the ‘send a message’ link to send an email directly to FHFA. It is fast and easy.

Wisconsin Land Trust Prevails Over 50-Year-Old Encroachment

Kimberly Seese — 2010-08-11T17:40:00Z

“Be alert and take immediate action,” says Jerry Petersen, President of the Kettle Moraine Land Trust in southeastern Wisconsin, “otherwise you’ll wake up some day and find that you may have lost land that you didn’t think you’d ever lose.”

Adverse Possession is a land taking process most of us know little about, but land trusts need to be alert to it before it is too late. The land trust learned an important lesson: be proactive, know your boundaries, and make sure they are clearly marked. Fortunately, the land trust managed to prevail in a litigation filed by neighbors to their 40 acre preserve called Island Woods. Neighbors across the road recently claimed they owned a 10 car wide parking area cut into the land trust’s preserve sometime around 1960.

The 11 year old Kettle Moraine Land Trust is relatively close to both Milwaukee and Chicago, and near the large Kettle Moraine State Forest owned by the Wisconsin Department of Natural Resources. At its founding in 1999, the land trust accepted title to a preserve called Island Woods on a peninsula in the Lauderdale chain of lakes. The preserve has undisturbed saw timber sized hardwoods covering rolling kettles and moraines which have been undisturbed for centuries. The kettles (depressions) and moraines (ridges) were left by retreating glaciers after the last ice age. The moraines rise over 100 feet from lake level. The preserve needed to be cleared of invasives, but otherwise was in great shape when the land trust acquired it. During the 50 years that it was owned by a lake improvement association, it was left in a totally undisturbed state.

The lake association helped establish the land trust largely because of their concern for the long term stewardship of the preserve. Real estate taxes had become a concern, and land trust ownership eliminated them. Also, land trust ownership brought active management, better public access, and youth education programs. After the land trust took title, it discovered that around 1960 one of the home owners across the road from the preserve had carved out a parking area for 10 cars for their visitors. They cut into the hill, built a stone wall, and cleared vegetation. Their use was occasional, and intermittent, but it went unchallenged by the then owning lake association for over 30 years. About ten years ago, the neighbor died, and her home was sold. The new owner became a more frequent user of the parking spaces.

The land trust started building a trail across the preserve for public access, and put up signs at the parking area reserving part of it for trail parking. At the same time, the trust approached the new neighbors to propose a sharing agreement for the parking area. The neighbors refused, and when the land trust temporally chained off the area to prove ownership, the neighbor took down the chain and filed a lawsuit claiming “Adverse Possession” ownership of the entire parking area. Both the past and current neighboring home owners are second home owners using their home only for vacations.

The land trust retained a qualified real estate attorney and researched the history of the parking area by interviewing several other neighbors and relatives of the prior deceased owner of the neighboring home, getting a survey and checking the land and zoning records. The land trust’s attorney told them “Adverse Possession” is a process that can take away the title to land if the encroaching user can prove (in Wisconsin, the number of years varies by state) that he:

Encroached hostilely (i.e. without getting permission) for 20 years,
Encroached notoriously (obvious to the public) for 20 years,
Encroached continually for 20 years, and
Encroached exclusively for 20 years.

In this case, the neighbors met the first two criteria, but not the last two. The land trust had testimony from other neighbors that the encroachment was neither continuous, nor exclusive. However, with the first two criteria met, a “Prescriptive Easement” could be claimed. A “Prescriptive Easement” provides for the shared use of the land, and the Easement automatically transfers to future owners of the land to which it is attached. The land trust had offered shared use before the litigation, and is pleased with the result.

The neighbors’ attorney had attempted to intimidate the land trust into abandoning the parking area. However, the land trust attorney countered with a demand that the neighbor prove his (and/or the prior land owner’s) continuous and exclusive use of the parking area for 20 years. When the neighbors could not prove this use, their case folded.

Now the neighbors have recorded a “Prescriptive Easement” where in the land trust retains ownership of the land, has the exclusive use of 2 parking spaces for trail users, and the neighbor has the principal use of the other 8 spaces. However, the land trust has the right to the exclusive use of all the spaces for a few events a year with 2 weeks advance notice.

Jerry says that “this matter should have been pursued back in the 60s by the prior land owner.” At this point the land trust didn’t have any other options since the 20 year time period had expired.” The land trust attorney did some pro bono work and the land trust was able to keep his charges below $4,000. However, land trust Board members spent over 200 hours of volunteer time on the case. According to Jerry, legal costs could easily have been over $25,000 if the land trust, and its attorney, had not short circuited the neighbors’ contentions through their interviews and their attorney’s skilled handling of the case.

The land trust extended the trail this spring to the opposite side of the preserve. The land trust is accomplishing its objectives of making the property available to the public, and expanding its use for youth education; especially for high school students to learn more about flora and fauna in this unique geological area.

Now that the land trust is alert to “Adverse Possession” risk, the board acts to preclude it from becoming a problem on other fee property. In this case some neighboring home owners are starting to cut their lawns over their lot lines. This time the land trust is taking immediate action to post the boundary, and to educate the neighbors.

For more information:
Jerry Petersen
Kettle Moraine Land Trust
jerry@kmlandtrust.org
http://kmlandtrust.org/

Kettle Moraine is a large moraine in the state of Wisconsin stretching from Walworth County in the south to Kewaunee County in the north. It has also been referred to as the Kettle Range and, in geological texts, as the Kettle Interlobate Moraine.

The moraine was created when the Green Bay Lobe of the glacier, on the west, collided with the Lake Michigan Lobe of the glacier, on the east, depositing sediment. The western glacier formed the Bay of Green Bay, Lake Winnebago and the Horicon Marsh while the eastern one formed Lake Michigan. The major part of the Kettle Moraine area is considered interlobate moraine, though other types of moraine features, and other glacial features are common.

The moraine is dotted with kettles caused by buried glacial ice that subsequently melted. This process left depressions ranging from small ponds to large lakes and enclosed valleys. Elkhart Lake, Geneva Lake, Big Cedar Lake are among the larger kettles now filled by lakes.

Some 20,000 years ago, two lobes of a great ice sheet met along a line extending northeast from Richmond in Walworth County through the Oconomowoc Lake country to Kewaunee County. One lobe moved down what is now the Green Bay-Lake Winnebago area. Spreading under tremendous pressure, the two lobes met and in the encounter, large blocks of ice were broken off and buried in the glacial deposit or till. As the ice melted, "kettles" were formed, some only a few yards across, others 100 to 200 feet deep.

The ice moved under great pressure, changing shape rather than sliding across the face of the land. As it changed shape, large amounts of rock, gravel, sand and silt were picked up and carried along by the glacier. When the ice melted, this material was deposited, in some instances, across glacier-formed valleys. Some "kettles" were formed this way.

The Kettle Moraine is an area of varied topography--parallel, steep-sided ridges, conical hills and flat outwash plains, mostly composed of sand and gravel. Many of the conical hills are conspicuous. Holy Hill reaches an elevation of 1,361 feet above sea level and some 340 feet above the stream valley to the east. Sugar Loaf or Pulford Peak (elevation 1,320 feet) is 320 feet above Pike Lake. Lapham Peak (elevation 1,233 feet), where there is a picnic area and observation tower, is 343 feet above Nagawicka Lake.

Similar detached sand and gravel conical hills, called kames, characterize the moraine throughout much of its extent. Some of these kames are cones formed beneath the glacier by surface streams which fell through holes in the ice. The undulating level-topped, narrow ridges called eskers were probably deposits in open cracks (crevasses) in the ice. In some areas the outwash terraces are pitted due to the melting of buried ice masses.

The Kettle Moraine area rises to 300 or more feet above the lands to the east and west yet is not a continuous divide. Maximum thickness of the drift is not known because few wells reach bedrock. It is possible that the drift reaches a thickness of 500 feet in some places.

Limestone underlies much of the Kettle Moraine. This formation is 450 to 800 feet thick and dips gently eastward. Its western edge or escarpment extends from Washington Island to the Illinois line near Walworth. It lies 20 miles to the west of Kettle Moraine at Greenbush, is completely covered by the moraine in the Waukesha County area, and is 8 miles east of the moraine at Elkhorn. Because of the cover of drift, there are few outcrops in the moraine.

Lakes, of several origins, add greatly to the attractiveness of the Kettle Moraine. With the exception, of Pewaukee Lake, which lies in a preglacial valley blocked on the west and east by drift, all lakes in the Oconomowoc area occupy kettles. Long Lake, Big Cedar Lake and Elkhart Lake occupy preglacial valleys between morainic ridges. These valleys were probably occupied by ice blocks and escaped being filled by glacial drift.

Twelve Stories High and Four 747’s Wide: Proposed Gash in Mountain for Connector

Kimberly Seese — 2010-07-14T15:30:00Z

A Georgia city council voted to acquire a 100.5 acre conservation easement and designate the property as a significant wildlife refuge to preserve some of the last habitat of the threatened Cherokee Darter and a local mountain landmark that would be destroyed by a proposed highway project.

Georgia Department of Transportation plans call for an 800-foot wide, 125-foot deep gash to be blasted through Dobbins Mountain, the location of the conservation easement. The proposed mountain cut is tall enough to hold a 12-story building and wide enough to comfortably fit four 747 jet planes sitting wingtip to wingtip. The DOT's chosen route also crosses several creeks in the Etowah River basin and would further jeopardize the threatened Cherokee Darter.

Anyone who has suffered through stop-and-go traffic on the winding road between Rome and I-75 in Bartow County knows that a highway bypass is long overdue. The Georgia DOT is moving ahead with plans to build a bypass, but the specific route would cause environmental damage, waste millions of taxpayer dollars, and take much longer to construct compared to other viable options, according to the Georgia Conservancy.

Dobbins Mountain is a Bartow County landmark that soars more than 1,000 feet high. The preferred DOT route doesn't go around this formidable obstacle. It barrels right through it.

Compared to other alternatives, the DOT's favored route is 2.5 miles longer and requires the construction of seven more bridges and overpasses. In all, the cost difference runs about $80 million-- a stunning figure given the DOT's well-documented budget woes. The DOT has explored a more cost-effective and environmentally friendly option (known as "Route G") only to reject this approach in favor of a path through Dobbins Mountain ("Route D").

"There's a cheaper, more environmentally friendly way to build a road than to blast through Dobbins Mountain," says Pierre Howard, president of the Georgia Conservancy. "The proposed route was a bad idea years ago, and it's a bad idea now. It is unfair to taxpayers to build the most expensive route that also does the most environmental damage." For a comparison of the two routes, click here.

The City of Euharlee took control of a key piece of the planned route through Dobbins Mountain in Bartow County. The Council voted to accept a perpetual conservation easement offered by the landowners, and the documents, which create the wildlife refuge, were filed the next day. A letter to the state from a high-powered Atlanta legal firm followed, saying that because the City of Euharlee designated the 100-acre tract as a “significant wildlife refuge,” it should receive Section 4(f) protection from development.

Section 4(f) of the Department of Transportation Act of 1966 prevents DOT agencies from approving the use of public parks, recreational areas, wildlife refuges or historical sites unless there is no “feasible and prudent” alternative.

Euharlee City Manager Trish Sullivan said the City Council was moved by a May presentation at the Rollins family’s Carters¬ville Ranch that highlighted the natural habitat and other resources. The easement will enhance downstream water quality and will protect headwater tributaries that support stream habitats of the Cherokee Darter. The easement also preserves 100 contiguous acres of hardwood forest from encroaching metro development. That acreage is of sufficient size to protect sensitive species and to act as an important wildlife corridor.

“This is a significant and permanent conservation easement," said Euharlee City Manager Trish Sullivan. "Our city council is working proactively to avoid development of environmentally sensitive land resources and to preserve irreplaceable wildlife habitat in our part of Georgia.”

“We are particularly interested in greenspace and preservation,” Sullivan said. “How it affects the connector is not our decision to make.”

The Georgia Conservancy understands the need to invest in transportation infrastructure to ease traffic congestion in Bartow County and to better serve the Rome area. However, the rush to build the wrong road would come at far too great an expense.

Despite the City’s designation of the conservation easement as a significant wildlife refuge, the DOT still wants to condemn the easement land. As for the automatic federal protections that fall to a wildlife refuge, the DOT project manager was quoted as saying that you cannot manufacture a refuge just to stop a road and “Federal Highway is going to fight that fight in court.” The landowners and the City of Euharlee need help to fight DOT’s plans to condemn the easement property for road construction. For more information, please contact the individuals listed below.

The Georgia Conservancy has joined an effort to fight the DOT proposal. A group of concerned citizens known as the Coalition for the Right Road also is blogging about the issue at http://therightroad.wordpress.com/

The 7.3-mile limited access connector is aimed at providing a direct link from Rome to Interstate 75 and easing congestion on U.S. 41 in Cartersville. The route cleared a regulatory hurdle last year, but the proposed interchange at I-75 could open the door to reconsideration.

The Sutherland law firm (Henry Parkman and Lee Davis specifically) have been retained to fight the road and to protect the critical mountain landmark and wildlife habitat.

Read more: RN-T.com - Euharlee seeks to preserve land on 411 Connector route
See (https://www.georgiaconservancy.org/index.php?page=411-connector)
See also: (http://www.gpb.org/news/2010/06/18/city-protects-land-from-road-project)

For more information:

Chip Stewart
Senior Vice President
Cookerly Public Relations One Alliance Center
3500 Lenox Road, Suite 510
Atlanta, GA 30326
Phone: (404) 816-2037
chip@cookerly.com

Paul Donsky
Georgia Conservancy
817 West Peachtree Street, Suite 200
Atlanta, Ga. 30308
phone: (404) 876-2900
fax: (404) 872-9229
pdonsky@gaconservancy.org

Insurance Pooling Provides Solution to Legal Challenges

Kimberly Seese — 2010-05-12T15:50:44Z

Across America conservation easements and land owned by land trusts are increasingly under attack.

Laura Curliss offers a unique insight into the benefits of insurance pooling among a group as a way to share the expenses of defense and enforcement. As a board member of Clinton County Open Lands, Inc., Curliss embraces the responsibility to steward conservation easements in perpetuity. As a board member of Miami Valley Risk Management Association, she believes insurance pooling is the best solution to the legal challenges facing land trusts.

Curliss believes an insurance pool for the land trust community will better the conservation community in three distinct ways by providing:

Legal defense for land trusts of all sizes, locations, and budgets

National sharing of easement language and defense strategies

Increased conservation easement and fee land management expertise

The proposed Conservation Defense Insurance program would help land trusts to prevent and mitigate risks. Since the program is the first of its kind, a major challenge to the program is risk management.

“Clear easement language that addresses known risks is one key to reducing interpretation risks or violations,” stated Curliss. “A pool helps to concentrate claims management and legal expertise regionally and, in this case, nationally. This will lead to more predictability in claims handling and outcomes and to strengthened easement language. As land trusts use best practices in risk management and incorporate more enforceable language into their easements, legal decisions or outcomes should be favorable to the conservation community,” she said.

As the number of land trusts committed to the insurance pool increases, Curliss predicts the number of knowledgeable lawyers available to defend their cases will increase too.

“A good claims management team is invaluable”, said Curliss. “Most cases will not go to court. Your team can help you to avoid unnecessary litigation and resolve a case before it heads to court, if that is the best thing to do for conservation permanence.”

One key to risk management is regular review of best practices. “Pools usually offer targeted training to their members to address common risks. The Land Trust Alliance does this now, but pooling will bring another level of organization and communication. Best practices information will be quickly disseminated based on claims management experience.” Curliss said. “Finally and most importantly, there is strength in numbers. Land trusts will succeed in the awesome task of perpetual stewardship by working together on conservation easement defense.”

A single adverse decision from a legal case could endanger the permanence of thousands of easements. And without action now, the land trust community risks losing many of the gains made in recent years. To date, more than 270 land trusts from 46 states have committed over 88% (or 10,611) of the necessary 12,000 conservation easements and fee owned parcels to make the proposed Conservation Defense Insurance program feasible. If land trusts commit 100% of the needed conservation interest, then the Alliance board can consider moving to the next step of raising $4 million in capital to start the program.

Note: Your commitment is essential in order for the Alliance board to vote to proceed to the next step. Your one-time registration fee now would be used for start-up costs if the program starts. If not, the Alliance will return it in full. One of the next steps after enough land trusts commit to the program is to create a $4 million dollar endowment for the program. Land trusts who sign up for the program will NOT be asked to contribute to that fund, although all contributions are welcome. The Alliance proposes to raise the $4 million in capital from foundations and individual major donors. The Alliance welcomes suggestions and advice from land trusts about who might be interested in contributing to that fund.

Landowner’s Economic Woes Lead to Major Legal Challenge for Land Trust

Kimberly Seese — 2010-05-12T15:50:00Z

Ryan Boggs, executive director of the Legacy Land Trust in Colorado, never dreamt that mortgage subordination would lead to a $50,000 legal challenge lasting two years. Economic woes caused a landowner to default on a mortgage on conserved land. The lender foreclosed and tried to eliminate the conservation easement claiming that the bank employee who signed the subordination did so fraudulently and without authorization. The land trust board and staff were stunned at this blatant attempt to profit at the expense of the public investment in conservation.

By May 2009 the land trust was managing two other significant disputes: one where a neighbor sued for access over conserved land claiming a prescriptive right and another where a neighbor disputed the right of the landowner to operate trap shooting on an excluded parcel of land by a youth group and involved the land trust in the litigation.

“Even a big defense fund can go away really fast,” said Ryan. “We were surprised by the number of simultaneous disputes and by their source from third parties with bizarre claims. You never know what can happen or when.”

In all the land trust spent more than $56,000 in legal fees to litigation counsel and the land trust attorney and costs to manage these three simultaneous legal challenges. They also spent hundreds of hours of staff and volunteer time on them and an additional $46,000 to purchase the foreclosed lot and extinguish the mortgage. The land trust took this step in order to save the conservation investment and avoid a trial in the case of the challenged mortgage subordination. The land trust anticipates it will be able to recoup its costs upon resale of the conserved lot, subject to the conservation easement, once the economy turns around.

The land trust board struggled with its evaluation of what were the best avenues to take to preserve the conservation easement as well as its ability to sustain multiple challenges. They considered and rejected a complaint to banking regulators as well as publicity. While a trial may have resulted in a land trust win, with the possibility of fees and costs being awarded to the land trust, the cost for that route and the risk led the land trust to a negotiated settlement where they purchased the lot instead free of the mortgage.

“Despite the recorded subordination that was signed by a bank employee, the land trust was drawn into this expensive dispute”, said Allan. “When this happened the land trust took all necessary steps to defend the conservation easement. The economic impact to the land trust of doing its job in defending the conservation easement would have been more easily managed if the conservation defense program had been in place.”

The other two disputes were also dismissed after preliminary investigations and negotiation. Nonetheless, managing three simultaneous disputes stretched the staff and board capacity and caused fears of depleting all land trust reserves.

“The proposed conservation defense insurance program would be a strong safety net for Legacy Land Trust and any land trust that fulfills its obligations to uphold conservation permanence” said Ryan. “Our board committed to the program and wants to see it start. We know that legal challenges will continue to increase and will continue to be unpredictable. Insurance is perfect for this situation as a backstop for our defense reserves. It takes the threat of being bankrupted by a claim out of the dynamics when analyzing how to respond to a challenge.”

Ryan and Allan urge every land trust holding a conservation easement or owning land to join with the more than 256 others to the proposed collective defense effort. The Alliance board will not vote to proceed with the program until land trusts reach the minimum number needed for financial feasibility. So far land trusts have committed more than 10,600 of the 12,000 conservation easements and fee owned parcels necessary. For more information see www.lta.org/cdinsurance.

Safety Net for Land Trusts

Kimberly Seese — 2010-05-12T15:45:00Z

RJ Taylor, Conservation Director for the Connemara Conservancy Foundation advises all land trusts to “cover your butt”. That is what led the Foundation to commit to the proposed Conservation Defense Insurance Program. Without a Conservation Defense Insurance Program, they feel that their limited funds could be easily threatened by potential lawsuits. “No one would drive a car without auto insurance or own a home without casualty insurance. So who would hold conservation easements without adequate coverage from multiple risks?” asks RJ.

The Foundation currently has 5 conservation subdivisions within its portfolio. “Recognizing the number of landowners each of these projects represents a potential risk considering the issues of adjacent landowners around the subdivisions in a large suburban setting so it is prudent to have some financial protection for our stewardship endowments. These Conservation Subdivisions take much more of my time to manage than our single-landowner tracts, and have many other liability issues that could arise as compared to more rural easements,” according to RJ.

Six other Texas land trusts agree that the proposed conservation defense insurance program is a useful safety net for their existing defense reserves and to protect their portfolios and program viability.

Janae’ Reneaud, Executive Director of the Guadalupe Blanco River Trust feels lucky that they have not had a law suit yet. “But we know over time there is bound to be a conflict and we want to be prepared. The Conservation Defense Program can provide skills, support and funding that we might not be in a position to provide. The Trust has been very successful at acquiring a stewardship donation from landowners when they place a conservation easement on their land. Though the reality is if, or when, we have to fight a lawsuit it will likely exceed our funds. It is comforting to know that there is a safety net in place that has finances to assist and in addition provide experienced staff and support.”

In order for land trusts in America to be assured that they can fulfill their missions and responsibilities to their land owner partners, says George Cofer, Executive Director of Hill Country Conservancy, “they must have the resources to enforce and defend their conservation easements. Most land trusts need help to cover the potentially exorbitant expenses if litigation becomes necessary and so pooling their resources through the proposed Conservation Defense Insurance Program is the way to go.”

Dalmara Bayne, Executive Director of Native Prairies Association of Texas says that “Land Trusts have a fiduciary responsibility to both landowners and the public to plan for perpetuity; this includes being able to legally defend an easement. We have done a lot to prepare for this but having a backstop so we can sleep at night really helps.”

Mark Steinbach, Executive Director, Texas Land Conservancy says that “As the holder of some of the oldest conservation easements in Texas, we are now working with 2nd, 3rd, and in some cases 4th successor landowners. It is now more evident than ever that the Conservation Defense Insurance program will be paramount to providing security as we protect these properties in perpetuity.”

And this Case Winner is...Rockburn Land Trust

Kimberly Seese — 2010-05-12T15:45:00Z

Rockburn Land Trust won its five year legal challenge to save Colonial-era Belmont in Baltimore, Maryland. Read how they saved the site and encouraged the potential developer to fund environmental projects to preserve the historic character of the area.

Development of the historic site by Howard Community College threatened the adjacent conserved land with the extension of roads, utilities, over 100 condominiums and a conference center. After significant community pressure and financial losses, the College decided to put the historic property on the market instead of pressing for the permits it needed for expanded development. The College is committed to agreements with the Maryland Historic Trust and Preservation Maryland to preserve the historic character of Belmont. This historic area is surrounded by undeveloped Patapsco State Park land and in an area designated as a green hub by the Maryland Department of Natural Resources.

The Land Trust lessons learned included: initially underestimating the political and entrepreneurial forces associated with land development; better recognizing that those with educational expertise did not have comparable development expertise; understanding the pros and cons of expensive legal actions and the composition of a broad based legal team; the advantages and disadvantages of mediation, and the benefits of diverse preservation strategies and tactics.

The November 2009 College-neighbor agreement continues the area residents’ longstanding commitment to historical preservation and perpetual land conservation in collaboration with the Maryland Environmental Trust. These commitments were framed in 2003, addressing the use of Belmont and increased vehicle access over Belmont Woods Road, the 14’ private right of way. The College’s predecessor accepted the Covenant and the College recognized the existence of the Covenant when it purchased Belmont.

The November 2009 agreement incorporates much of the 2003 Covenant and provides for the College to continue educational programs, grants further increase in vehicle access to Belmont and funds various Belmont Woods Road environment projects. All the parties agreed to dismiss the litigation and to not institute new litigation for four years. This agreement may be terminated if the College is not actively marketing Belmont for sale. The College says that 9 serious future purchasers have looked at Belmont.

This environmental defense by the Rockburn Land Trust and the associated supporting lawsuit by a Land Trust member cost over $300,000 and consumed thousands of hours of volunteer time and hundreds of hours of county government hearings. The Howard Community College’s legal fees exceeded $400,000 and the College was found to be inappropriately funding Belmont’s development by moving budget dollars from one year to the next without County government permission.

For further information, contact Dale N. Schumacher at BWRCO@aol.com. Detail regarding perpetual conservation historic preservation of the northeast Howard County can be found at: www.savebelmont.org or at http://www.landtrustalliance.org/about-us/programs/conservation-defense/rockburn.

For news articles see:

“College settles on firm to sell its historic Elkridge estate.” November 28, 2009 Carson, Larry. Baltimore Sun. http://articles.baltimoresun.com/2009-11-28/news/0911270071_1_real-estate-college-officials-estate-marketing-firm

“HCC to Sell Historic Belmont Center.” September 3, 2009 Broadwater, Jennifer. Howard County Times. http://www.explorehoward.com/news/64893/howard-community-college-sell-belmont-property/

“HCC President vows to return 1.7 million in surplus budget funds College had used money to purchase historic Belmont”, May 19, 2009 Carson, Larry. Baltimore Sun.

“College to return funds used to buy estate – Government wasn’t told $1.7 million was public surplus”, May 20, 2009 Carson, Larry. Baltimore Sun. http://articles.baltimoresun.com/2009-05-20/news/0905190036_1_college-president-community-college-college-foundation

Insurance Pooling Provides Solution to Legal Challenges

Kimberly Seese — 2010-04-14T16:15:33Z

Across America conservation easements and land owned by land trusts are increasingly under attack.

Curliss believes an insurance pool for the land trust community will better the conservation community in three distinct ways by providing:

Legal defense for land trusts of all sizes, locations, and budgets

National sharing of easement language and defense strategies

Increased conservation easement and fee land management expertise

As the number of land trusts committed to the insurance pool increases, Curliss predicts the number of knowledgeable lawyers available to defend their cases will increase too.

Landowner’s Economic Woes Lead to Major Legal Challenge for Land Trust

Kimberly Seese — 2010-04-14T16:12:58Z

Salzburg v. Dowd Settlement Upholds Easement’s Permanence

Kimberly Seese — 2010-03-17T15:50:00Z

After more than six years of litigation, a case involving a Wyoming county commissioners’ attempted termination of a perpetual conservation easement settled, with the conservation easement remaining in full force and effect. The attempt to terminate the conservation easement came at the request of the successor land owners. A local newspaper editor challenged. The Wyoming Supreme Court dismissed the case for lack of standing in Hicks v. Dowd, 157 P.3d 914 (Wyo. 2007). The Wyoming Attorney General then filed suit, and the parties settled while motions for summary judgment were pending.

On February 17, 2010, the Fourth District Court of Wyoming entered a “Stipulated Judgment” incorporating the parties’ settlement agreement disposing of Salzburg v. Dowd. The judgment briefly reviewed the history of the case and of coalbed methane development on the Ranch, which had triggered the attempt by the successor owners, Fred and Linda Dowd and the Johnson County, Wyoming Board of Commissioners to terminate the conservation easement.

The settlement agreement ratified by the Court states that
1)   The County’s attempted termination of the conservation easement had no legal effect;
2)    The quitclaim deed by which the County attempted to convey the conservation easement to the Dowds was null and void and of no effect;
3)    That the quitclaim deed by which the County conveyed the easement and the trust to the Scenic Preserve Trust is in full force and effect as amended by the parties’ agreement and the court order.

This leaves the conservation easement and one-acre parcel (a necessity under Wyoming law at the time) held by the Board of County Commissioners of Johnson County as Trustees of the Scenic Preserve Trust.

In addition, the Stipulated Judgment ordered two amendments to the conservation easement. The first amendment acknowledged that the easement could not affect the pre-existing rights of mineral owners and lessees (which is, of course, the law) and that the Dowds would have no liability on account of such pre-existing rights.

The second amendment provided for assignment of the easement, subject to approval of the landowners, or by order of court. The Dowds were also relieved of any responsibility to reimburse the County for costs incurred as a result of the original effort to terminate the easement (part of the Dowd’s original agreement made in exchange for the County’s promise to terminate the easement).

The settlement reinforces trust and confidence in conservation easements as a durable land protection tool and concludes nearly seven years of litigation resulting from the attempted termination of the Meadowood conservation easement.

More Information
For the pleadings in the Salzburg case, go to The Learning Center conservation defense clearinghouse and click on the easement termination collection.

For more information see the following articles available at The Learning Center:

Could Coalbed Methane be the Death of Conservation Easements?, by Nancy A. McLaughlin, 29 Wyoming Lawyer 18 (2006).

Hicks v. Dowd: The End of Perpetuity?, by C. Timothy Lindstrom, 8 Wyoming Law Review 1 (2008).

In Defense of Conservation Easements: A Response to The End of Perpetuity, by Nancy A. McLaughlin & W. William Weeks, 9 Wyoming Law Review 1 (2009).

Conservation Easements, Common Sense and the Charitable Trust Doctrine, by C. Timothy Lindstrom, 9 Wyoming Law Review 2 (2009).

Hicks v. Dowd, Conservation Easements and the Charitable Trust Doctrine: Setting the Record Straight by Nancy A. McLaughlin and W. William Weeks, 10 Wyoming Law Review 1 (2010).

State, Landowners Negotiate in Easement Suit, Casper Star-Tribune, 9/25/09

Land Wars: Two Cases Shape Future of Land-Use in Wyoming, New West Development

Wyoming Star Tribune February 2010 article on Salzburg v. Dowd conservation easement termination case settlement. County agrees to drop case

Conservation easement issue settled on Meadowood Ranch, Buffalo Bulletin, 2/24/10

Federal Court Upholds Land Trust Refusal to Sign Questionable Form 8283

prichardson — 2009-12-18T20:45:00Z

Headlands, a real estate development company, negotiated with government regulators to develop 121 acres on the California coast. They received approval contingent on permanent protection of 29 acres of the property, and sold them to the Center for Natural Lands Management (CNLM).

When Headlands presented Form 8283 for signature, CNLM refused, and Headland filed suit. CNLM saw the sale as a permit requirement without donative intent. The court ruled in favor of CNLM citing a sales contract stating that neither party relied on tax advice from the other.

For more information:

Bruzewicz Case Denies an Easement Deduction for Lack of a Substantiation Letter

prichardson — 2009-12-18T20:45:00Z

United States District Court Northern District of Illinois Eastern Division dated March 25, 2009. The Federal District Court ruled in an historic preservation easement deduction refund case that the taxpayer failed to obtain the necessary contemporaneous charitable substantiation 170(f)(8) gift letter and that therefore the deduction was appropriately denied by the IRS. The judge also addressed substantial concerns about the quality and methodology of the valuation appraisal. The Tax Courts appear to be unanimously upholding this 170(f)(8) gift letter bright line test to disqualify deductions.

Rulings on gift letters have varied between the District Courts (strict compliance) and Tax Courts (substantial compliance). In a summary bench order the Tax Court dismissed a similar summary judgment motion in a New York case. If a donor is unable to produce the required gift letter but has other contemporaneous writings that show substantial compliance, then the donor may be well advised to consider filing in Tax Court rather than District Court.

More fallout after the Bruzewicz v. USA decision from the United States District Court Northern District of Illinois Eastern Division has surfaced in Colorado and elsewhere. After the issuance of the Bruzewicz decision, it appears that the IRS has changed the authority of the Colorado branch of the IRS Appeals Division to settle cases by reducing the value the IRS is allowing for the conservation easement, unless the taxpayer can produce the goods and services letter. It also appears that in a number of cases, these landowners did not obtain the goods and services letter from the land trust. Many of the conservation easements under audit were donated many years ago, in 2002 and 2003. The IRS is asking the taxpayer to produce these goods and services letters for the first time, six to seven years later, and in most cases after the audit has been closed, with the dispute having moved on to the IRS Appeals Division or Tax Court. It looks like the IRS believes it has found its silver bullet to disallow these conservation easement charitable deductions on a technicality and not on the merits of the donation. The result is that potentially hundreds – maybe thousands - of landowners nationally who donated valuable development rights to land trusts and permanently restricted their property with conservation easements, may have their charitable contributions disallowed by the IRS as a result of not being able to provide the goods and services letter to the IRS. As the IRS continues to audit conservation easement donations from tax years 2006 through 2008, the experts assume that the goods and services letter issue will be on the IRS checklist. If the taxpayer does not have the goods and services letter, then the experts anticipate that the IRS will disallow the entire deduction. For more information and general guidance on the goods and services letter, click here.

If a donor is unable to produce the required goods and services letter but has other contemporaneous writings that show substantial compliance, then the donor may wish to consider filing in Tax Court rather than District Court. See the memorandum on substantial compliance in the document folders under IRS Cases, Issues and Forms/Contemporaneous Acknowledgment and Substantiation. Land trusts may also wish to evaluate with their legal counsel and their boards whether to issue late goods and services letters for past years where the statute of limitations has not expired. Looking backward, donors vulnerable now may not just those who donated in 2008, 2007, and 2006 (and filed the following year), but if a donor filed for a carry-over deduction, then those who donated in 2001, filed in April, 2002, and filed for a carried over deduction in 2007 may also be vulnerable. Obviously these are complex issues and land trusts and their donors must consult tax counsel for advice.

Please note: The best method to avoid these challenges for future easement donations is to issue a contemporaneous goods and services letter for every donation. Do not rely on substantial compliance arguments going forward. See the Chief Counsel Advisory on what constitutes “contemporaneous” also in the above folder.

Read the full Bruzewicz decision >>

Brandywine Conservancy Initiates National Coalition on Energy Policy

prichardson — 2009-12-18T20:45:00Z

Large swaths of permanently protected land have been targeted for the siting of utility infrastructure projects. In some cases these areas encompass entire states. Thousands of acres of permanently protected natural and agricultural resources are being threatened by these projects which use federal pre-emptive authority to circumvent state and federal environmental laws, utility regulations and conservation decisions.

The Brandywine Conservancy has formed a coalition with other land trusts and interested parties around the country to bring the conservation community’s mounting concerns about utility infrastructure threats to the attention of decision-makers in Washington, D.C.

Rather than a piecemeal approach fighting one proposed gas or power line after another, the Conservancy has brought together other conservation organizations and government agencies to create a national coalition of concerned parties to influence a more balanced national policy on utility infrastructure.

Now is the time for conservation groups to join together to defend our mutual interests. Collective defense is always more effective than one group fighting a national effort. Land trusts need a coordinated effort to ensure that new utility projects do not erode years of effort and investment to permanently protect open space.

Pressure needs to be applied at the federal level to have Congress: 1) reform the federal approval process for utilities; 2) engage in long-term planning to assess and address realistic future energy needs; 3) create education and incentives to programs to reduce energy demand; and 4) invest in alternative energy technologies that would reduce the need for additional infrastructure.

The Conservancy invites you to join in this effort. For more information contact Sherri Evans-Stanton, Director, Brandywine Conservancy Environmental Management Center, 610-388-8398 or sevansstanton@brandywine.org.

Utility Infrastructure Advocacy Project (Word, 36KB)

More on condemnation and National Interest Electric Transmission Corridors (NIETC)