CONSERVATION EASEMENT CHECKLIST
Step 1: Initial Contact between Landowner and Westchester Land Trust
Landowner will:
q Review the documents in this packet for general information on conservation easements and their possible tax benefits
q Contact Westchester Land Trust and arrange for a visit from staff
q In preparation for the site visit or at the very beginning of the easement process, the landowner should have available copies of all maps and surveys of the property, as well as the deed and any existing title reports. If the easement is being done as part of a development project the landowner should also have available pertinent documents from the planning board, particularly the conditions for sub-division approval.
q Join WLT on a tour of property and discuss goals for the project, including conservation values to be protected and what part of your land you would like to place restrictions on, the nature of those restrictions, and the rights you would like to reserve
Westchester Land Trust will:
q Explain the nature and benefits of a conservation easement
q Walk the land and discuss the conservation values of the property and be available to discuss various options for restrictions and reserved rights and what is most appropriate for your particular situation and your particular property
q Discuss the steps, timing and costs associated with donating the conservation easement
q Provide information about possible consultants, appraisers and attorneys, if necessary
q Be available to the landowner to help coordinate the work of the professionals
Step 2: Establish Development Potential of Property, Area to be Preserved, Tax Value of Easement and Other Particulars
(Not all landowners will need to go through all the following steps)
Landowner will:
Begin the steps below immediately after beginning project. It is important to keep on top of all required professionals, as their work takes a long time and requires follow-up!
q Have an updated title search done on your property to ensure that any previous mortgages or liens have been properly satisfied or assigned to any current mortgage
q If there is an existing mortgage or lien on the property, you will need an agreement from your bank or lien holders that any foreclosure on the property will continue to recognize the terms and restrictions of the conservation easement in perpetuity, usually called a subordination agreement. There may be a fee for this service. Depending on the size of your mortgage institution, this could take weeks to months to complete, but is required by the IRS and is necessary to ensure your easement is protected in perpetuity. Therefore the work of subordinating any mortgages or liens on your property to the conservation easement must be started at the beginning of the easement donation process. Your bank might require an appraisal to assure that its collateral retains sufficient value to secure the loan, and the appraisal for the easement donation discussed below might be able to serve both purposes. The mortgage agreement must be in a form recordable by the county clerk and the land trust will need this agreement completed at least two weeks before the execution of the conservation easement in order to have our title company review it.
q If you plan to take a tax deduction and need to determine the development potential of your property, contact an engineer. Depending on the complexity of your potential easement, the cost of this work is usually between $3,000 and $10,000.
(over)
q To establish the tax value of your conservation easement you need to contract with an appraiser for an appraisal of the value of the easement donation. The cost for this service is usually between $4,000 and $6,000.
q Discuss the tax benefits of the conservation easement with your tax adviser. Consult your tax adviser for the cost of this service.
q Hire an attorney to review the conservation easement. Consult the attorney for the cost of this service.
q Provide Westchester Land Trust with copies of updated surveys
Westchester Land Trust will:
q Seek approval of the conservation easement from Westchester Land Trust’s board of directors
q Provide a draft conservation easement for the landowner’s review
q Be a resource for landowner and all professionals at every stage of the process
q Prepare a baseline data report, required by the IRS. This report documents the important natural features and conditions of the land under easement.
q Be available to the landowner to help coordinate the work of the professionals throughout the entire process, if requested
Step 3: Completing the Conservation Easement and Associated Tax Forms
Landowner and the Westchester Land Trust will together:
q Review and finalize the draft of the conservation easement
q Execute final easement, prepare New York State form TP 584, sign completed baseline data report
q Discuss a tax-deductible donation to Westchester Land Trust to ensure the land trust’s ability to monitor the easement in perpetuity, as per IRS requirements. We request a stewardship donation commensurate with the costs of creating the easement and monitoring it in perpetuity.This gift ensures we are able to carry out our stewardship responsibilities in perpetuity. Westchester Land Trust staff will discuss this gift with you at the beginning of the project, and use our Stewardship Calculator to determine the cost to the land trust of your particular easement. This gift may be pledged over a period of time and paid in installments.
Westchester Land Trust will:
q File the easement and any mortgage subordination agreement with Westchester County Land Records Division and New York State Office of Real Property Services
q Provide the landowner with written acknowledgement of the easement donation, as well as the accompanying stewardship donation and a copy of the easement
q When the landowner provides Westchester Land Trust with a copy of the appraisal and IRS form 8283, the land trust will sign the 8283 and return it to the landowner for tax filing
q The land trust will submit the recorded easement to New York State Department of Environmental Conservation and obtain an easement number for the landowner for claiming the New York State Conservation Easement Income Tax Credit
Step 4: Managing the Conservation Easement
Landowner will:
q Arrange with Westchester Land Trust for annual monitoring of the property (Westchester Land Trust will send the landowner a letter suggesting a time)
q Notify the land trust if exercising any reserved rights that could impact the conservation values of the conservation easement or of activities for which the easement requires the landowner to obtain land trust permission
q Inform Westchester Land Trust if property is being sold and provide successor owner information
Westchester Land Trust will:
q Contact the landowner annually to arrange a site visit to monitor the easement
q Meet with the landowner, if requested, to help with land management issues