Land Conservation Tools
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Fact Sheet #6
Land Acquisition Land acquisition is a process in which a public agency or nonprofit land conservation organization purchases all the ownership rights to the land from a willing seller. What are the public benefits of acquiring land for conservation?
Public ownership of land may be the best choice when local governments need full control of the land. Drinking water sources and land by lakes and rivers may need special management to protect water quality. Environmentally sensitive lands such as steep slopes and areas with native plants or wildlife may need special care. People may want public access to the land for education and recreation. What advantages can the landowner enjoy?
Landowners are paid full fair market value based on an independent appraisal of their land. They may enjoy tax benefits by donating all or part of the value of their land or by exchanging land (purchasing another property within a short period of time). How does a public agency or nonprofit
organization acquire land?
What is the process? What are some ways to structure a purchase
To provide for a landowner who wants to continue living on the land, a public agency can delay public control of all or a portion of the land by negotiating a life estate or a lease-back arrangement. With a life estate, the public agency pays the landowner fair market value for the land minus the value of the landowner's use during his or her lifetime, which depends on the projected life span of the landowner. The landowner receives payment during his or her lifetime and continues to live on the land. For tax planning reasons, a landowner may prefer to receive several payments spread over time instead of one large sum at closing; lease-purchase and annuities are two potential methods to meet the landowner's needs. In a lease-purchase, the agency purchases the land after making lease payments through an agreed-upon time period; the title is conveyed to the agency when the last lease payment is made. The total cost is usually the land's fair market value at the time of the agreement plus interest. With an annuity, a buyer purchases an annuity benefiting the seller and receives title to the land. The seller receives annuity payments, a set dollar amount, over time. Payment by the agency can be spread out or made in one lump sum. For budgetary reasons, a public agency may prefer to pay over time. With a lease-purchase involving only the seller (described above), the agency pays the seller directly over time. When the seller wants to receive a lump sum, but the agency can only pay over time, the agency can use a variety of financing strategies to purchase the land. Please refer to the Financing Land Protection Fact Sheet in this series for more information on financing public purchase of land for conservation. Where do public agencies secure
funds to purchase land? How can land protection and development be combined?
In some cases, the most important part of the land can be protected while the rest of the land is developed in a manner which is compatible with the public open space and is sensitive to community interests. Limited development may generate sufficient funds to preserve open space without public funds. To learn more about purchase of land by public agencies or nonprofit organizations, contact the Trust for Public Land. For more information on these tools, refer to the other fact sheets in this series. The Green Corridor Project is dedicated to helping Washington and Chisago County residents keep the beautiful countryside, farmland, and special natural areas that make this a great place to live. The project is an independent network of the seven local public and private organizations listed on the front of this sheet. For more information, call 1000 Friends of Minnesota or any of the project collaborators. Fact Sheets in This Series
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