Spring 2009

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Field Notes: Spring 2009


To Preserve and Protect: Farmland Preservation in Oklahoma

–Wylie Harris and Mary Penick

Facts about Conservation Easements

Just as mineral rights and water rights have long been severed, bought, and sold, a willing landowner can sell or donate the development rights to a public agency or a qualified conservation entity through a deed of conservation easement.

The landowner retains full possession and use of the property for purposes other than those restricted by the easement.

Conservation easements are voluntary, compensatory tools to protect land from development pressure at prices that are more affordable for public agencies and conservation organizations than outright purchases.

A conservation easement is an economical way to protect scenic views and other open spaces that are important to the community.

Conservation easements may be perpetual or term (set to expire after a predetermined number of years). Donations of easements are only tax deductible, however, if they are perpetual.

Just as importantly, easements leave private lands in private ownership, and keep the land productive, providing essential landowner stewardship and contributing to the local tax base.

Easements provide an economically viable alternative to subdivision and development, by compensating landowners for the development rights they would forego by keeping the bulk of their property as open space, rather than converting it, for example, to a strip mall or a housing subdivision.

Conservation easements are flexible documents; they can be tailored to meet the needs of individual landowners. They can also be tailored to suit unique properties. The specific development rights that a landowner will forgo or restrict are fully negotiable between the landowner and the qualified conservation entity. For example, while restricting a subdivision, landowners may want to reserve the right to develop a limited number of home sites.

Many open space uses are generally permissible including farming, ranching, hunting, fishing, and other activities that do not damage the property's conservation values.

Like other property rights, development rights can be appraised and assessed a value. Depending on proximity to urban areas and other factors, the development rights can comprise over 80% of a property's appraised fair market value.

Donations of conservation easements to eligible entities are normally tax-deductible at their appraised fair market value.

Voluntary conservation easements can be valuable estate planning tools for landowners. By reducing estate taxes, conservation easements can help landowners pass on their land to their children and grandchildren.

Excerpted from Protecting Farm and Ranch Lands through Conservation Easements
Robert Gregory and Terence Bidwell
OSU Cooperative Extension Service Fact Sheet F-2879

Throughout the United States, farmers and ranchers wage an uphill battle against the increasing size of cities and suburbs. This growth and expansion eats away at some of America’s most valuable agricultural land, while driving land prices and taxes beyond the reach of most farmers and ranchers.

Farmland Loss and Preservation in Oklahoma.

Oklahoma is not immune to this phenomenon (See box). While the Sooner State ranks lower in the amount of agricultural land lost to development than some surrounding states, it still places in the top half of states losing their farming and ranching capabilities to unfettered development.

Map of farmland Loss in Oklahoma.

The map of Oklahoma agricultural land loss (right) shows where high quality (also known as prime) farmland is being lost to urban development. Farmland in or near the Oklahoma City and Tulsa metropolitan areas is in particular danger.

Protecting farmland maintains the necessary land base for growing a local food supply. However, farmland preservation also benefits local communities in many other ways, including lower costs of public services, increased tax revenues, improved flood control, and higher water and air quality.

Land Legacy

Land Legacy
Land Legacy, a nonprofit land trust that works to preserve Oklahoma farmland, has put over 14,000 acres under conservation easements in 45 completed projects in 13 Oklahoma counties during its five years of existence.

A conservation easement is a legal agreement that lets landowners donate, or sell, the rights to develop their land. Land placed under an easement is protected from development in perpetuity.
“The good thing is that easements are a completely voluntary program,” says Kerr Center President Jim Horne, who also serves on the Land Legacy board.  “The government isn’t telling you what to do, and the landowner has complete freedom of choice in setting up the terms of the easement to suit his or her wishes.”
Such arrangements allow landowners to receive economic benefits from the rising value of their land.  In addition to the proceeds from any development rights sold, these can include tax deductions and reduced property taxes.

A bill proposed in the 2008 Oklahoma legislative session would, if passed, have added tax credits to this list. At the same time, conservation easements preserve open space and agricultural productivity. (See sidebar for more on easements.)

The areas that Land Legacy protects include working farm and ranch lands, former rail lines now being converted to trails, greenbelts at urban edges, and parks and other open spaces in the hearts of the state’s largest cities.

Trust in the Future
Headquartered in Tulsa, Land Legacy is the only statewide land trust in Oklahoma. Its mission is “to conserve and enhance rural and urban landscapes,” preserving open space while allowing agricultural production to continue in areas under high development pressure. The organization serves both Oklahoma and other areas of the south central United States.

Land Legacy works cooperatively with public agencies, other conservation organizations, and landowners to establish long-term conservation goals and programs, to identify specific parcels of land whose conservation is consistent with those goals, and to determine which specific tools are best suited to each individual project.
Land Legacy began as the Oklahoma state office of the Trust for Public Land (TPL), a national, nonprofit land conservation organization. During a nationwide layoff, TPL was forced to close its Oklahoma office.

Jim Horne, who had served for three or four years on the TPL board, began asking the staff of the closing office, “Could we make it on our own?”  Ultimately, Horne says, “We chose to go it alone and keep the work going.”

A New Lease
After a meeting with TPL co-chair Don Walker, TPL Oklahoma Director Robert Gregory, and the Kerr Center board of trustees, Horne said, the Kerr Center put some initial seed money into the newly formed Land Legacy to keep farmland preservation going in Oklahoma.

In January 2003, Land Legacy was incorporated as a nonprofit land conservation organization for Oklahoma, with Horne serving on the board of directors.

Its new independent status also allowed Land Legacy to hold conservation easements and other properties, in contrast to TPL’s policy of holding properties only temporarily.

According to Gregory – now Land Legacy’s Executive Director – the Kerr Center was instrumental in the transition, providing not only financial support but also technical assistance, as well as “opening doors for us with public officials, landowners, and other key parties interested in land conservation.”

“Land Legacy is forever indebted to the Kerr Center!” he says.

By the Bootlaces
That admiration flows both ways.  “I’ve got to give a lot of credit to Robert and the staff for staying with it,” says Horne.  “A couple of times they even missed a paycheck or two.”

In the early going, Land Legacy acquired most of its easement acres as donations, from landowners seeking a way to keep farming their land while protecting it from development.  Operating funds stayed short, though.
Some early financing came through donations from large easement holders, and a bank loan. “Small infusions of cash would always come at just the right time,” Horne says.

“We started doing some work with some developers who wanted to incorporate sustainability into their subdivisions, and got some income from that,” Horne recalls.

“That funded a lot.”

Gradually, the organization’s finances eased into the black.  Still, as development continued to drive up land prices, chasing donated easements all across the map became less feasible. To adapt, Land Legacy shifted its focus to purchasing more easements, and initiating contacts with landowners. It also devised a new strategic plan.

New Approaches
“We had to prioritize areas where we could really make a difference, not only where there was a conservation need,” says Gregory.

“Now we are focusing our resources by identifying properties that are important to conserve and then knocking on landowners’ doors. We have fewer projects and acres, but we have more meaningful results.”

The new plan’s priority areas include preserving prime agricultural land near urban areas, and protecting the Spavinaw Creek watershed, which provides drinking water for Tulsa.

“We’re now being sought out for a number of projects,” Horne says.  “Nearly every quarter we have two to four projects pending.  The largest one is doing a border around Fort Sill.”

The Lawton/Fort Sill area forms one of the most active fronts in the first priority area – preserving prime farmland near cities. As urban growth expands toward formerly isolated military bases, training exercises can create nuisances in nearby neighborhoods.

Joining forces with the Department of Defense, Land Legacy is actively working to protect a 20,000-acre buffer zone around Fort Sill. Cache rancher A.J. Ryder sold the first 300-acre easement in July of 2006.
In total, 14 landowners signed commitments to permanently protect their land from development in the Fort Sill Army Compatible Use Buffer Program (ACUBP).  In 2007, Land Legacy purchased five of these easements on 426 acres as part of the ACUBP, with funding from the USDA-NRCS Farm and Ranch Lands Protection Program (FRPP). 

Help from the Feds
The FRPP operates nationwide, providing up to 50% matching funds for the purchase of conservation easements.   In 2006, FRPP allocated over $700,000 to Oklahoma. 

The following year, the program doubled its number of easements in the state and nearly doubled its acreage as well, for a total to date of ten easements and 991 acres in four counties. Of these acres, 543 are prime farmland.
The new Farm Bill increased FRPP funding to $743 million over the next five years nationwide.  (See p. 13 for other positive outcomes for sustainable agriculture in the Farm Bill.)

Additional funds for the Fort Sill project come from the Department of Defense, the State of Oklahoma, and the Comanche County Industrial Development Authority.  That long list of partners is mirrored in Land Legacy’s current work in the other priority areas of its strategic plan.

In its efforts to protect the Spavinaw Creek watershed, for example, the organization is partnering with the U.S. Fish & Wildlife Service to preserve strips of buffer vegetation along sensitive creeksides to reduce erosion and agricultural runoff. This will improve water quality for human consumption while preserving habitat for endangered species.

Branching Out
For preservation efforts, especially in high cost areas, Gregory says that more private donations are needed to match USDA funds. Although Land Legacy is the only statewide land trust operating in Oklahoma, other local trusts are also taking up the work of farmland preservation. Examples include the Edmond Land Conservancy and the Norman Area Land Conservancy.

“As sprawl continues, we see smaller communities setting up trusts,” Horne observes. “We see that as a positive thing.”

Just as agriculture is finding a home in more and more cities worldwide, so is Land Legacy finding that its efforts at preserving agricultural land and open space have a role in Oklahoma’s urban areas. For example, it is working with the Tulsa Development Authority to create a string of parks downtown, beginning with the creation of Legacy Place in summer 2004.

It also assists Oklahoma City’s “Groundworks” program, which provides funding to clean up contaminated inner-city sites and turn them into open space or new development. The program is funded by the Environmental Protection Agency and administered by the National Park Service.

Conservationist Aldo Leopold once noted that “to keep every wheel and cog is the first rule of intelligent tinkering.”  Oklahoma’s remaining farms and farmers are essential parts of a healthy state food system. Oklahoma would do well to preserve its farmland as it tinkers with new approaches to using it sustainably.

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