Real Estate - Back to Basics: Conservation Easements

If you have ever gone for a walk in the woods on a public trail in Maine, it is very likely you have enjoyed the benefits of a conservation easement.  Looking back to my post about easements from last year, we know that an easement is a right of use on another's real estate. An easement can provide right of way access for you and your vehicles, or more limited access for a single utility. Easements can also provide rights by prohibiting the fee owner from using his or her property in a certain way. For example, a view easement may limit the height allowed on a piece of property.  Conservations are like the above examples; however, they do have some specific requirements provided by Maine statute.  

The Maine Conservation Easement Act (MCEA) provides the following definition for Conservation Easement: "a nonpossessory interest of holder in real property imposing limitation or affirmative obligations the purposes of which include retaining or protecting natural, scenic or open space values of the real property; assuring is availability for agricultural, forest, recreational or open space uses protecting natural resources or maintaining or enhancing air or water quality of real property. 33 M.R.S.A. § 476(1). 

Conservation easements are created in the same manner that traditional easements are created. The landowner executes a written document granting rights to a grantee (or in the Conservation Easement context, "holder"). This written instrument is then recorded in the country registry of deeds. It is also important to note that conservation easements may only be amended with permission from a court.  Therefore, it is important to pay attention to details throughout the process. 

Along with defining what a conservation easement is, the MCEA also defines who may hold a conservation easement. You will not be able to grant your neighbor or your business a conservation easement. Conservation easements must be held by nonprofit organizations, charitable trusts or governmental entities. Further, a nonprofit organization's formation and governing documents must reflect the conservation purposes of a potential conservation easement donation.  

The meat of the easement will be found in the document itself. For example, the easement deed will define the physical area impacted by the easement. Further, the easement will define which uses will be allowed on the property and whether public recreation will be permitted. It will also lay out the rights and responsibilities of each of the parties.   

As referenced in my article on Maine's Current Use Tax Programs, conservation easements can result in tax benefits for landowners.  In addition to the property tax benefits, a donation of a conservation easement can be deductible as a charitable contribution. This deduction does come with its own complexities that require attention throughout the donation process.  

Conservation easements provide recreational and scenic benefits all over Maine. Next time you use a land trust property you now know a little bit more about the legal mechanisms providing those benefits.