Conservation Easements

[H.B. Userman]

Thank you for the responses.

I booked the class, and will be taking it in a couple weeks.

 

[BobfromSalem]

I took the one-day overview course that was offered up in Madison, WI. Frank Harrison (MAI from Woodstock, IL) taught the course. He is one of the course authors for the 4 1/2 day class on conservation easements. Fees are certainly higher, but so is the potential exposure to the IRS. Already have my "CE" for this year, but I am planning on taking the big one next Spring (the 4 1/2 day deal), since I believe it will help bring in more biz.

 

[JT1974]

HB Userman,

I believe Bruce Closser will be teaching the class so you'll be in good hands. Bruce is a nationally recognized ski area appraiser. He also teaches the Yellow Book class that I recently took. The conservation easement stuff is essentially a niche market that could be profitable if someone were to do a significant amount of it. However, like with eminent domain work, there is a lot of additional research and reporting requirements, which makes this type of work less profitable unless you do a lot of it.

Good luck.

 

[Kali the Boston Terrier]

My class was with Bruce as well...the highlight of the class. I'll mirror what JT has said, conservation easements are highly risky, require a lot more due diligence, and are not just another feather in your cap. Although the fees are much higher, it will take you all your billable hours just to get it right...at least for the first 10-20. My last easement was 300+ pages (60 pages of which was the baseline study, another 20+ was the actual easement agreement).

Like anything in our business, having a great database is essential to being profitable. However one thing that will not be taught in that class, but something a lot more neccessary than even the class is having a great relationship with the different easement holders. If all you are doing is AG work, than DNR, USDA...etc. is usally a pretty good source. However if you are doing scenic and/or open land that group is a lot wider...for every area that has those types of lands there is usually three to four Gov't agencies that hold easements, and another five to six conservancy groups that do as well. I had one in northern Michigan that not only had the DNR holding easements, but the Township holding TDRs, and eight nature conservancy groups holding them as well. Positive in all that is I had market extracted resales of properties subject to easements...bad news it was stretched out between 10 different groups.

One thing I learned from the Easement Class was to get your client to sign affidavits stating any known or perceived "quid pro quo" arrangements, ownership of all family owned parcels within a 50 mile radius, and intentions of all plans for non donated land. I then put a copy of those sworn statements in the appraisal...take that IRS.

 

[PLCG]

Kali,

Could you explain this a little further?

"One thing I learned from the Easement Class was to get your client to sign affidavits stating any known or perceived "quid pro quo" arrangements, ownership of all family owned parcels within a 50 mile radius, and intentions of all plans for non donated land. I then put a copy of those sworn statements in the appraisal...take that IRS."[/QUOTE]

This came up on a recent report. It was a request from an out of state client. The subject had one contiguous parcel not included in the easement and the client wanted it included, and also any change in the parcel's value resulting from the easement. I did not understand the request since we were doing the easement for the conservancy. I could understand including the parcel [not included in the easement] if the property owner was the client but I don't understand including it when the conservancy is the client.

Help! m2:

Pat

 

[Kali the Boston Terrier]

I know you stated that the client was the conservancy, but was the intened use for donation purposes? With the implied use of the appraisal to determine the amount of donation to be written off on the Federal Income tax? Or a related implied use a TDR that was being with Federal funds (or earmarks)?

If either one of those questions are answered with a yes, I suggest you PM me for further explanation...you don't want this in a public forum, we have lurkers with alterior motives and this will always be available using a quick google search.