Policy: Environment & Energy

Taxpayers funding huge federal land grabs that may harm environment

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Photo - ANATOMY OF THE LAND GRABS: Critics say conservation easements help the federal government gobble up more land.
ANATOMY OF THE LAND GRABS: Critics say conservation easements help the federal government gobble up more land.
News,Watchdog,Environment,Taxes,Energy and Environment

Governments and green groups all across America are gobbling up private land in a determined and often coordinated effort to forever restrict responsible development and restrict private property rights.

And American taxpayers help fund it.

Here's how it works: Private property owners, either interested in preserving trails, wetlands, scenic views or open spaces or looking for generous tax benefits, donate or sell off their development rights -- including resource extraction -- to government organizations or qualified nonprofit groups like Ducks Unlimited or The Nature Conservancy.

The arrangement, known as a conservation easement, forever encumbers the property. Even if the property owners sells the land or gifts it to heirs, the agreement legally blocks development.

The landowner can still hunt on the land or use it for farming and ranching, but cannot build, subdivide or perform any activity incompatible with conservation values.

The federal government and some states encourage the practice with generous tax deductions and credits. The federal income tax deduction only applies, however, to donors who agree to restrict development into perpetuity, as opposed to signing term-limited deals.

Roger Colinvaux, associate professor at the Columbus School of Law, notes the deductions cost $1.22 billion in 2008 and $2.18 billion in 2007, the latest figures available.

Several analysts and the Internal Revenue Service say the federal income tax deduction is vulnerable to abuse, particularly because donors can inflate land values, thereby reaping heftier tax credits.

In the past, clever wealthy developers have placed conservation easements on golf courses to secure the tax benefits. Critics long have wondered if that designation meets conservation objectives.

According to the National Conservation Easement Database, trusts and governments hold more than 95,000 easements, locking up more than 18 million acres of land.

The injurious effects of the lock-ups are many, said Harriet Hageman, a fourth-generation Wyoming rancher and land lawyer. "It's a bad idea," Hageman warned. "It really is."

Conservation easements, she said, knock "the hell out of" the property value, decrease the tax base for schools, counties and cities, and set permanent land-use policies without regard for future considerations.

Americans would soundly reject, Hageman said, land-use policies set in the 1600s because society changes and so do the needs of the county's population.

Conservation easements, she said, bind future generations without considering their values and needs. "The arrogance of that is shocking," she said.

Some free-market enthusiasts see the easements as a government-free solution to conservation, circumventing zoning restrictions or other regulations.

The New Mexico Land Conservancy, for one, uses this argument to solicit donations from government-wary landowners.

"Conservation easements are a voluntary, free-market technique that provides tax and financial incentives in exchange for giving up certain land use rights," the group's website explains.

While many see the easements as an avenue to land preservation without involving Uncle Sam, critics, like Hageman, argue that the arrangements have become just another way for the governments to grab land.

Most easement contracts allow the grantee -- the land trust or the government entity -- to transfer or sell the easement's development rights to another party.

This allows groups like The Nature Conservancy to buy up easements and flip them to the federal government, usually earning a tidy profit in the process.

National Center for Public Policy Research analyst Dana Joel Gattuso offered particularly sharp criticism of The Nature Conservancy in a 2008 conservation easement analysis.

She chronicled a deal in which the group bought an easement for $1.26 million, then sold it to the Bureau of Land Management for $1.4 million.

While many of these green organizations rely on individual or foundation donations for operating cash, they also receive millions each year in government grants.

According to foundation records, five major players in conservation easements -- The Nature Conservancy, The Conservation Fund, American Farmland Trust, Ducks Unlimited and The Trust for Public Land -- have received more than $2 billion in government grants since 1998.

The Nature Conservancy and Ducks Unlimited are the biggest recipients, taking $761 million and $718 million, respectively.

Gattuso said the close relationship between green groups and the federal government benefits both parties, but can damage transparency.

"Land trusts benefit because they can earn a profit off the taxpayer-funded arrangement," she wrote. "Government agencies like the arrangements because, unlike seizing private lands through land-use regulations, zoning laws or even eminent domain, they can obtain the private property via methods shielded from public scrutiny."

While environmentalists might applaud easements in the ongoing effort to protect Mother Nature, the strict easement agreements might actually hurt protected land.

Gattuso said new knowledge suggests that healthy forests require thinning, but that "conservation easements with the specific purpose of perpetually protecting habitat in a forest may not allow for necessary logging and thinning projects."

Dustin Hurst is a reporter for Watch.org, which is affiliated with the Franklin Center for Government and Public Integrity.

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