On today’s show we’re talking about conservation easements. These are a poorly understood and rarely used asset type.
My friend Tom Wheelwright is fond of saying that the tax code should be viewed as a series of incentives. The portion of that tax code that extracts money from business, employees and the population at large can be described in a very small number of pages. The thousands of other pages enshrined in the legislation can be thought of as a series of incentives.
Conservation easements are one such incentive.
The idea is that governments like to see land protected in its natural form. This can sometimes be done through zoning. But zoning is not perpetual, and zoning can be changed. If you truly want to preserve land for ecological purposes in perpetuity, then you need a land use mechanism that is even stronger than zoning.
Enter the conservation easement. With a conservation easement, land is donated in perpetuity to conservation through a land trust.
Host: Victor Menasce