Is Forever Always Forever? Bill To Alter Conservation Easements Divides Advocates

Mar 10, 2014

Conservation easements are legal agreements designed to protect land from development forever. But a bill under consideration in the Statehouse would allow those restrictions to be amended, or lifted entirely.

The bill has sparked a fierce debate among land conservation advocates. Opponents argue the legislation could lead to circumstances in which land that was supposed to be protected "in perpetuity” no longer would be.

The bill is being strongly backed by Darby Bradley, the former head of the Vermont Land Trust, who now lobbies for the organization in the Statehouse.

Bradley said the idea that easements need to be made more flexible in some circumstances first came to him 10 years ago when he was traveling across the country. He was outside St. Louis, almost 200 years from the time that Lewis and Clark launched their exploration of the American west.

“And got to musing to myself, suppose I had been a land trust lawyer in Missouri in 1804 and had written a conservation easement on a farm outside of St. Louis,” he said. “What’s happened in the last 200 years that I would not have anticipated, and what’s going to happen in the next 200 years that we can’t possibly imagine?”

In Perpetuity No Longer

The legislation would allow conservation easements to be amended, or terminated after a review by the environmental court or a new five member panel.

"Under this law, easements could be amended or terminated and the land sold for development, and the proceeds used to buy other lands or other easements in other parts of the state." - John Echeverria, Vermont Law School professor

The bill passed the Senate last year and is now pending in the House. Bradley said the goal is to give easement holders such as the Vermont Land Trust more options to deal with changing times, and changing land uses. As an example, he said that a farm covered by a conservation easement may need a new building to house seasonal workers – but the construction would not be allowed under the easement terms. Those terms could be altered through the new process allowed under the legislation.

But the bill would also permit much more drastic changes to conserved land. And that’s what the opposition is focused on.

“Under this law, easements could be amended or terminated and the land sold for development, and the proceeds used to buy other lands or other easements in other parts of the state,” said John Echeverria, a professor at Vermont Law School.

Following Donor Intent

Echeverria and two other lawyers who specialize in land conservation issues wrote a scathing VtDigger opinion piece criticizing the legislation. Echeverria calls the bill a radical and unnecessary change. He says that people donate conservation easements to protect a specific piece of property – not to make the land an asset that could be sold to finance other conservation efforts.

“Landowners are encouraged to make donations of easements on the promise that their land will be protected,” he said. “If they don’t have assurance that their land will be protected, I think landowners will be much more reluctant to give.”

At the Upper Valley Land Trust, executive director Jeanie McIntrye also fears that the legislation would have a “chilling effect” on easement donations.

"I've spent my life in this, and I'm retiring. I don't want my life work undone. This is a protection of what people have done before. But also a recognition that circumstances are going to change." - Darby Bradley, Vermont Land Trust.

McIntyre points out that the bill would allow easement terms to be altered retroactively – after the property is already under protection.

“And that’s seriously problematic because of none of the donors that I’ve worked with have known that this type of thing was a possibility,” she said.

Darby Bradley says such cases would be extremely rare – and would only occur if the landowner and the easement holder agreed.

“I’ve spent my life in this, and I’m retiring. I don’t want my life work undone. This is a protection of what people have done before. But also a recognition that circumstances are going to change,” he said. “This is to try to create a system that is open, transparent, with public access, third-party review that will maintain the integrity of the system.”

Existing Doctrine

Echeverria agrees that changing land uses or other circumstances could lead to the need to alter easement terms.

“There’s no question that circumstances change, and there has to be some flexibility in the easement system, but that kind of flexibility is already provided under current law,” he said.

Easements can be altered, he said, when courts follow a common law doctrine called “cy-pres,” which means “as near as possible.” If the original purpose for which a donation was made is no longer possible to achieve – for example, a scholarship fund to a school that has closed – courts can change the terms of the charitable trust to achieve something very close to what the donor intended.

“But that is a very strict standard. It’s hard to meet it. And the reason that it’s a strict standard is because charitable donors will not give if their charitable purposes will not be carried out,” Echeverria said. “So the law has developed in a way that’s designed to protect the intentions of donors.”

Bradley argues that a state-specific law is needed to deal with amending conservation easements. He said when he chaired a study for the national Land Trust Alliance on this issue he learned “to my surprise, that there was virtually no where in the country any law, any standards about this.”

Bradley said the cy-pres doctrine is not applicable in many land conservation cases. That’s because in the circumstances he envisions, the easement amendments would be needed not because it’s impossible to follow through on the original charitable intent, but because other, potentially better options are available for the conserved land.

“These are amendments which are intended to promote or enhance the original conservation purpose,” he said.

He added that cy-pres does not apply to all conserved land, such as easements that are bought or transferred. “So when we acquire by purchase (an easement), or we acquire the land and we sell the farm subject to an easement, cy-pres doesn’t fall into that because there’s no charitable transaction,” he said. 

Bradley said the debate has broken down into "two camps" - legal experts who believe that the law covering charitable donations should apply to easements, and those, like himself, who believe that a new system is needed. 

But critics such as Jeanie McIntrye and John Echeverria say the legislation that Bradley has staked his decades-long reputation on threatens a land conservation system that has served Vermont well.

McIntrye said she is troubled by the possibility allowed under the legislation that conserved land could be sold to acquire easements or land that might have “higher conservation value.”

“Conservation easements are very powerful tools,” McIntrye said. “And the commitments we make to landowners who give up tremendous opportunities, tremendous financial values, these gifts have an impact on families – they’re made for really serious, compelling reasons, and to think that at some point in the future, someone might say, ‘well it’s the same property it’s always been, but it’s just low conservation value,’ is just so inconsistent with the communication to donors.”

What Will IRS Say?

Echeverria also worries that the Internal Revenue Service could no longer allow tax deductions for easement donations if there’s no longer a guarantee that the land will be protected forever.

“The Internal Revenue Service requires that donors of easements in land make the gifts in perpetuity and that the gift relate to that particular piece of land. If easements can be swapped across the landscape in Vermont in the future, there’s a substantial risk that donations of easements in the state will not be eligible for favorable tax treatment,” he said.

McIntrye agrees. “I think that’s a serious concern, but it’s not nearly as big a concern to me as the integrity of our organization’s commitment to donors, and our ability to uphold our promises over time,” she said.

Bradley said the concerns about the IRS are overstated. “There have been sort of categorical statements made about where the IRS is, but it isn’t true. And it’s just unclear. And people who are far more experienced in tax law and the IRS regulations than me don’t agree,” he said.

The Senate bill on the easement issue is now in the House Judiciary Committee. The dissenting opinions have slowed its progress, and the panel is expected to continue its review next week.