LAND CONSERVATION LAW TRANSACTIONS SYLLABUS
Spring Semester, 2012, Meeting January 15th -April 23rd, 9:00am-12:30pm
01/18, 01/25, 02/01, 02/08, 02/15, 02/22, 03/01, 03/08, 03/15, 04/05
For Three Course Credits
Taught By:
Jessica E. Jay, Attorney at Law
Conservation Law, P.C.
52 Meadowlark Drive, Evergreen, 80439
phone: 303-674-3709, fax: 303-674-3715
email: conservationlaw@msn.com
website: www.conservationlaw.org
Course Description: Increasingly important in our efforts to preserve ecological diversity, historic
places, working lands, scenic viewsheds, open space, and public uses of land are conservation tools and
processes such as donation of conservation easements, purchase of sensitive lands, and private/public
partnerships for land conservation. Students will research and review the swiftly developing body of law
and legal issues accompanying the use of conservation easements, and will gain a practical understanding
of both the legal and non-legal dimensions of land conservation transactions involving conservation
easements. In addition, students will actively be engaged in a progressive conservation transaction,
beginning with early negotiations, drafting, and financial analysis, and proceed along a spectrum to
donation, violation, and enforcement of terms of a conservation easement. Each student will be
responsible for role playing exercises throughout the conservation transaction process and will assess
various financial scenarios, identify and resolve disputes related to the conservation transaction, and
prepare, draft, and negotiate a conservation easement.
Prerequisites: Students will benefit from having taken an introductory-level Real Property Law course or
practical experience in real property transactions.
Evaluation: Students will be evaluated based on preparedness for class, class participation in discussions
and role-playing exercises, including research and presentation of their conservation easement, and final
conservation easement draft. The final conservation easement draft will take the place of a final exam
and will be due as a take-home exam, due by the end of Reading Week.
Course Materials: Reading material will be provided through textbook chapters provided on TWEN.
Role-play exercises and the model deed of conservation easement also will be made available to students
via TWEN, as will updates to this syllabus (make sure you check the most up-to-date syllabus!). Students
will prepare role-play exercises and their own deed of conservation easement for class discussions.
Office Hours: Fridays after class, 12:30-1:00, and/or by appointment on Fridays.
Class 1 – Friday, January 18th – Conservation Easements—A Tool to Protect the Environment—
What Are They and How Do They Work?
Reading Assignment:
TWEN: Model Conservation Easement, First Role Play Exercise, and (you may want to print out the
following chapter):
Textbook, Intro and Chapter One, pp. 1-53, including:
Read Origins and Background
Read 26 U.S.C. § 170 Charitable Contributions and Gifts (focus on 170(h))
Read 26 C.F.R. § 1.170A-14 Qualified Conservation Contributions (focus on 1.170A-14(d), (e), (f)(1))
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Skim 2006 Pension Protection Act and Extension, IRS Guidance Notice 2007-50, IRS Q&A
Read Restatement of the Law (Third) Property (Servitudes) §§ 1.6, 4.3
Read Uniform Conservation Easement Act and Commentary AMENDED 2007 (focus on §§1(1),
2(a)&(c), 4)
Skim Colorado Conservation Easement Enabling Act, C.R.S. §38-30.5-101 et seq. (focus on §§101-104)
Conservation Transaction: Download from TWEN and bring to class model conservation easement and
first role play exercise, electronically or by hardcopy. After role play exercise, determine family’s needs,
land’s conservation value(s), and land trust mission. Determine whether land trust is a good fit with land
owner. Review model conservation easement and its conservation value sample language and begin
drafting conservation values section of conservation easement.
Class 2 – Friday, January 25th – Conservation Easement Holders—Qualified Organizations,
Perpetual Stewardship and Enforcement Responsibilities, Standards and Practices, and Due
Diligence for Conservation Transactions—Title/Minerals and Water Rights
Reading Assignment:
Review § 170(h)(1), (3), (5), (6) (pp. 23-4)
Review § 1.170A-14(a), (c), (g)(2), (4) (5), (6) (pp. 25-6, 33-35)
Review Restatement of the Law (Third) Property (Servitudes) §1.6(2) (p. 44)
Review U.C.E.A. § 1(2) (p. 48)
Review C.R.S. §38-30.5-104, and §§101-11 (for water and mineral references)
Textbook, Chapter Two, including:
Read Background
Read Restatement of the Law (Third) Property (Servitudes) §4.6
Read 26 U.S.C. § 501(c)(3) and 26 C.F.R. § 1.501(c)(3)-1
Skim Land Trust Standards and Practices: (focus on 9: Sound Transactions and 11: Stewardship of
Conservation Easements)
Read MET v. Gaynor II
Skim Land Trust Risk Management of Legal Defense and Enforcement of Conservation Easements:
Potential Solutions
TWEN:
Reasonable Accommodation Doctrine, C.R.S. §34-60-127.
CE Mineral Surface Use Agreement and Amendment.
CE Mineral Remoteness Report/Letter Example.
WATER RIGHTS HANDBOOK: FOR CONSERVATION PROFESSIONALS, Colorado Water Trust, 2005,
excerpts pp. 1-19, 97-116.
Peter J. Nichols, “Do Conservation Easements and Water Mix (In Colorado)?” 5 U. Denv. Water L. Rev.
504 (2002).
Guest Speaker: Dan Pike, President, Colorado Open Lands
Conservation Transaction: PREPARE YOUR ROLE BEFORE CLASS. Examine Land Trust’s mission,
identify conservation values on the subject property, revise/draft conservation easement to meet
conservation values and mission, review minerals, and other requirements. Examine subject property title
insurance policy for ownership, minerals, and other title issues. Determine responsibilities regarding
subject property conservation value protection, documentation, minerals, and monitoring. Draft easement
to address responsibilities and to incorporate new facts; use drafting sections for guidance.
Conservation Transaction: TO THE EXTENT POSSIBLE, PREPARE YOUR ROLE BEFORE CLASS.
Examine subject property title insurance policy for ownership, minerals, and other title issues. Determine
responsibilities regarding subject property conservation value protection, documentation, minerals, and
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monitoring. Draft easement to address responsibilities and to incorporate new facts; use CE Handbook
and Mineral Handbook drafting sections for guidance in Appendix of Textbook. Determine
responsibilities regarding water rights. Revise easement to address responsibilities and to incorporate
new facts; use Water Rights Handbook and CE Handbook drafting sections for guidance. Use any extra
time to review and update draft CE.
Class 3 – Friday, February 1st – Conservation Incentives—Federal Income and Estate Taxes
IRS Scrutiny and Enforcement
Reading Assignment:
Review § 170(a), (b)(1)(C), (E), (f)(8), (11) (pp. 21-3)
Review § 1.170A-14(e), (h), (i) (pp. 31-2, 35-8)
Review 2006 P.P.A. Extension/IRS Guidance/Notice 2007-50, LTA memo (pp. 39-43)
Review Land Trust Standards and Practices, Practice 10 (pp. 96-7)
TWEN: Skim Washington Post/The Nature Conservancy Series
Textbook, Chapter Four, Subchapters A and B, pp. 132-79, including:
Read Background
Read 26 U.S.C. § 2051 and 26 C.F.R. § 20.2051
Read 26 U.S.C. § 2055 and 26 C.F.R. § 20.2055
Read 16 U.S.C. § 2031(c)
Skim IRS Notices Regarding 2004-41 and 2004-86; Joint Committee on Taxation Subcommittee
Recommendations; LTA Form 990 Guidance
Read Glass v. Commissioner, 124 T.C. No. 16; No. 17878-99 (May 25, 2005); appealed No. 06-1398
(December 21, 2006)
Skim Summaries of Bruzewicz v. Commissioner, 604 F.Supp.2d 1197 (2009); Hughes v. Commissioner,
2009-94 T.C.M (2009); and Kiva Dunes v. Commissioner, 2009-145 T.C.M. (2009)
Conservation Transaction: PREPARE YOUR ROLE BEFORE CLASS. Examine income tax incentives
for landowners, crunch numbers for deductions to offset taxable income, establish value of conservation
easement donation, determine net benefit to family for income tax purposes. Examine consequences of
bargain sale for income tax purposes and/or estate tax benefits. Revise relevant conservation easement
sections.
Guest Speaker: Larry Harvey, Tax Appeal Attorney
Class 4 – Friday, February 8th – Conservation Incentives—State and Local Taxes: Property Taxes,
Tax Credits, and Private Property Rights
Reading Assignment:
TWEN: Skim State Tax Credits Summary
Review Colorado Conservation Easement Enabling Act, CRS §38-30.5-109
Skim Colorado Agricultural Property Tax Assessment, CRS §39-1-101, §39-11-136(3)
Tax Credit Cap/Ag Assessment Bill HB10-1197 (2010)
Ag Property Tax Task Force HB10-1293 (2010)
Textbook, Chapter Four, Subchapter C, pp. 180-96, including:
Read Background
Read Parkinson v. Board of Assessors of Medfield, 481 N.E.2d 491 (Mass., 1985); Parkinson v. Board of
Assessors of Medfield, 495 N.E.2d 294 (Mass., 1986)
Read In the Matter of Wilhelmina duPont Ross v. Town of Santa Clara, 266 A.D. 2d 678, 698 N.Y.S.2d
(1999)
Read Colorado Conservation Easement Tax Credit Act C.R.S §39-22-522; Department of Revenue
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Regulations 39-22-522
[Read as Background for Role Play: TWEN: French & Pickering Creeks Conservation Trust v. Natale
Article;
Julia D. Mahoney, Perpetual Restrictions on Land and the Problem of the Future, Va. Law Rev. 739
(2002);
Trust for Public Lands, A Return on Investment: the Economic Value of Colorado’s Conservation
Easements (2010)
Textbook, Chapter Eight, Subchapter B, pp.434-36, Lessons from a Long Easement Violation Battle]
Guest Speaker: Ruth Becker, Attorney at Law
Conservation Transaction: PREPARE YOUR ROLE BEFORE CLASS. Apply property tax option to
family’s income scenario. Examine property tax changes and agricultural preservation options within
Colorado’s conservation easement statutes. Determine net benefit to family from property tax reductions
or consequences. Apply credit option to family’s income scenario, determine how much of a benefit
family could receive and/or how much of a credit they could sell under Colorado’s credit program.
Determine net benefit to family from tax reductions, income tax offsets, and conservation tax credits.
Consider family’s private property rights arguments. Revise conservation easement to incorporate new
facts.
Conservation Transaction: PREPARE YOUR ROLE BEFORE CLASS. Apply credit option to family’s
income scenario, determine how much of a benefit family could receive and/or how much of a credit they
could sell under program mimicking Colorado’s credit program. Examine property tax changes and
agricultural preservation options within Vermont conservation statutes. Determine net benefit to family
from property tax reductions, income tax offsets, and conservation tax credits. Consider family’s private
property rights arguments. Revise conservation easement to incorporate new facts.
Class 5 – Friday, February 15th–Transactions on a Landscape—Agricultural and Working Forest
Conservation Easements
Reading Assignment:
Review 26 U.S.C. § 170(h)(4)(a)(iii) (p. 23)
Review 26 C.F.R. § 1.170A-14(d)(4)(i),(iii), (pp. 27-8) (e), (f) Examples (2), and (5) (pp. 32-33)
TWEN: Read William J. Ginn, Investing in Nature, The Connecticut Headwaters Case Study
Read Peter Stein, Working Forests and Conservation Easements, Silviculture Magazine
Skim Forest Land Deal Sets State Record Article
Textbook, Chapter Six, Subchapter A, pp. 198-239, including:
Read Background
Read Libertyville v. Bank of Waukegan 504 N.E.2d 1305 (Ill. 1987)
Read Southbury Land Trust, Inc. v. Andricovich, 757 A.2d 1263 (Conn. App., 2000)
Read Bennett v. Commissioner of Food and Agriculture, 576 N.E.2d 1365 (Mass., 1991)
Conservation Transaction: PREPARE YOUR ROLE BEFORE CLASS. Consider discussion points for
working forests and working ranch and farmland. Contemplate case study example, discuss past, present,
future possibilities. Continue revising and drafting conservation easement: revise and negotiate recitals
and permitted/prohibited use and resource management sections of
conservation easement. Compare easement working landscape components, if any, to role play.
Class 6 – Friday, February 22nd– Transactions with Landowners—A Landowner’s Story
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Reading Assignment:
Highline/Anderson Conservation Easement Documents, including Conservation Easement, Background
Document, Title Commitment, Baseline Inventory, and Form 8283 (TWEN)
Guest Speaker: Dan Pike, Colorado Open Lands, Catherine Anderson, Landowner, and field trip (try to
arrange to carpool to and from campus after meeting in the classroom for a brief lecture).
Conservation Transaction: TO THE EXTENT POSSIBLE, PREPARE YOUR ROLE BEFORE CLASS.
Compare Anderson’s conservation easement and supporting documents to your Nelson draft CE and
facts. Compare your procured conservation easement transaction facts, funding, and language to your
Nelson draft conservation easement and fact situation. Be prepared to present overall overview
comparison of your procured conservation easement and Anderson’s conservation easement to the
Nelsons’ conservation easement in this class, and to compare specific aspects of the procured
conservation easement in the next classes.
Class 7 – Friday, March 1st—The Challenge of Perpetuity: Changed Conditions, Amendment, and
Termination of Conservation Easements (Are Conservation Easements Forever?)
Reading Assignment:
Review 26 U.S.C. § 170(h)(5)(A) (p. 24)
Review 26 C.F.R. § 1.170A-14(g)(6) (p. 35)
Review UCEA §2(a), §3(b) (pp. 48-9)
Review Vermont Conservation Easement Act §6308 (p.56)
Review 26 U.S.C. § 501(c)(3), 26 C.F.R. § 1.501(c)(3) (p. 89)
Review Standards and Practices 11 I, J, K (pp. 97-8)
TWEN: Vermont Proposed Legislation
Skim Article/Read Case Studies: Darby Bradley, “Amending Perpetual Conservation Easements:
Confronting the Dilemmas of Change: A Practitioner’s View”
Skim Alexander Arpad, “Private Transactions, Public Benefits, And Perpetual Control Over The Use Of
Real Property: Interpreting Conservation Easements As Charitable Trusts” 37 Real Prop. Prob. & Tr. J.
91 (2002)
Textbook, Chapter Seven, pp. 241-336, including:
Read Background
Read Restatement of the Law (Third) Property (Servitudes) §§7.9, 7.10, 7.11, 7.16
Skim Strasburg v. Commissioner of Internal Revenue, 79 T.C.M. 1677 (2000)
Skim Bjork v. Draper, 381 Ill.App.3d 528, 886 N.E.2d 563, 319 Ill. Dec. 800 (Ill.App. 2 Dist., 2008) and
Illinois Conservation Easement Enabling Act (focus on termination and amendment issues)
Skim Hicks v. Dowd, P.3d 914, 2007 WY 74 (2007); NPR Shifting Ground Piece; Salzburg v. Dowd,
Stipulated Judgment (focus on termination and amendment issues)
Skim Walter and Otero County Land Trust (05-CV-96, Order [Otero Cty. Dist. Ct., June 21, 2005]
[Prepare for Role Play]: Review IRS Notices 2004-41 and 2004-86 (p. 150), and Skim Exchange Articles
on Private Inurement, Conflict of Interest, and Restatement/Changed Conditions (pp. 331-36)
Guest Speaker: Darby Bradley, Special Assistant and former President, Vermont Land Trust
Conservation Transaction: PREPARE YOUR ROLE BEFORE CLASS. Contemplate potential liability
for land trust to amend easement: who stands to lose, who stands to gain; contemplate consequences of
IRS audit. Determine if private inurement, private benefit, or conflict of interest exists. Review Notices
Regarding Improper Deductions for Conservation Easement Donations and IRS Notice 2004-41 and
2004-86, and 990 Instructions if negotiating IRS audit. Review amendment, termination, and changed
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condition section of easement; revise accordingly.
Reading Assignment:
Review 26 C.F.R. § 1.170A-14(c)(2), (g)(6) (pp. 10, 21-22 of Course Pack).
Review 26 U.S.C. § 501(c)(3), 26 C.F.R. § 1.501(c)(3) (pp. 46-53 of Course Pack).
Review Standards and Practices 11 I, J, K and Definitions (pp. 63-66 of Course Pack).
Review UCEA Commissioners’ Prefatory Note, §2, §3 (pp. 40-43 of Course Pack).
Review Walter and Otero County Land Trust (05-CV-96, Order [Otero Cty. Dist. Ct., June 21, 2005])
Facts and Notes (p. 329 of Course Pack and TWEN).
Restatement of the Law (Third) Property (Servitudes) §§7.9, 7.10, 7.11, 7.16 (pp. 288-96 of Course
Pack).
Amending Conservation Easements: Evolving Practices And Legal Principles: LTA Research Report
(August 2007) (pp. 330-32 of Course Pack).
LTA Exchange Articles on Private Inurement and Conflict of Interest (1999) (pp. 333-37 of Course
Pack).
Strasburg v. Commissioner of Internal Revenue, 79 T.C.M. 1677 (2000) (pp. 297-305 of Course Pack).
Bjork v. Draper, 381 Ill.App.3d 528, 886 N.E.2d 563, 319 Ill. Dec. 800 (Ill.App. 2 Dist., 2008) (pp. 30615 of Course Pack).
Hicks v. Dowd, P.3d 914, 2007 WY 74 (2007), plus NOTE (pp. 316-24 of Course Pack); NPR Shifting
Ground Piece (pp. 325-28 of Course Pack), plus Salzburg v. Dowd, Stipulated Judgment (TWEN).
Maine Public Law, Chapter 412, 123rd Maine State Legislature (2007) (pp. 235-36 Course Pack).
Skim CCLT Phasing Guidance (TWEN).
Skim Darby Bradley, “Amending Perpetual Conservation Easements: Confronting the Dilemmas of
Change: A Practitioner’s View” (TWEN).
Skim: Nancy A. McLaughlin, “Amending and Terminating Perpetual Conservation Easements” 23 AUG
Prob. & Prop. 52 (2009) (TWEN).
Skim Nancy A. McLaughlin “Condemning Conservation Easements: Protecting the Public Interest and
Investment in Conservation”, 41 U.C. Dav. L. Rev. 1897 (2008) (TWEN).
Conservation Transaction: TO THE EXTENT POSSIBLE, PREPARE YOUR ROLE BEFORE CLASS.
Contemplate potential liability for land trust to amend easement: who stands to lose, who stands to gain.
Determine if private inurement, private benefit, or conflict of interest exists. Review amendment,
termination, and condemnation, changed condition sections of easement; revise accordingly. Compare
easement amendment, termination, and condemnation provisions to role play.
Class 8 – Friday, March 8th— The Who, What, Why, Where, When and How of Conservation
Easement Enforcement—Conservation Easement Enforcement By and Against Third Parties
Reading Assignment:
Review 26 C.F.R. § 1.170A-14(c)(1)&(2), (g)(5) (pp. 10, 21 of Course Pack).
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Review U.C.E.A. § 1, 3 (pp. 41-43 of Course Pack).
Review Hicks v. Dowd, 157 P.3d 914, 2007 WY 74 (2007), plus NOTE (pp. 316-24 of Course Pack),
plus Salzburg v. Dowd, Stipulated Judgment (TWEN).
Review Bjork v. Draper, 886 N.E.2d 563 (Ill.App. 2 Dist., 2008) (pp. 306-15 of Course Pack).
Review Amended Maine Legislation (pp. 235-36 of Course Pack).
Restatement of the Law (Third) Property (Servitudes) §§ 8.3, 8.5 (pp. 209-13 of Course Pack).
Friends of the Shawangunks v. Knowlton, 101 A.D.2d 303 (N.Y. 1984); Friends of Shawangunks, Inc. v.
Knowlton, 487 N.Y.S.2d 543 (N.Y., 1985) (pp. 217-24 of Course Pack).
Tennessee Environmental Council, Inc., v. Bright Par 3 Associates, L.P., No. E2003-01982-Coa-R3-Cv.
(Tenn. Ct. App. 2004) (pp. 225-27 of Course Pack); Amended Tennessee Legislation (pp. 228-29 of
Course Pack).
Windham Land Trust v. Jeffords, 2007 ME Super. 140 (pp. 230-34 of Course Pack); Windham Land
Trust v. Jeffords, 2009 WL 705586 (Me.), 2009 ME 29 (pp. 237-44 of Course Pack).
WNYLC v. Cullen Summary and Appeal (TWEN).
LTA Exchange Article on Third Party Enforcement of Conservation Easements (2006) (pp. 245-50 of
Course Pack).
Skim Third-Party Enforcement of Conservation Easements 29 Vt. L. Rev. 757 (2005) (pp. 260-87 of
Course Pack).
Conservation Transaction: TO THE EXTENT POSSIBLE, PREPARE YOUR ROLE BEFORE CLASS.
Mediate third party violation. Review and revise third party and landowner liability, ADR and
enforcement provisions for conservation easement as necessary. Compare easement enforcement
provisions to role play.
Class 9 – Friday, March 15th--The Who, What, Why, Where, When and How of Conservation
Easement Enforcement—Conservation Easement Litigation and the Madden Case Study
Reading Assignment:
Review 26 C.F.R. § 1.170A-14(c)(1), (g)(5) (pp. 10, 21 of Course Pack).
Review U.C.E.A. § 1, 3 (pp. 41-43 of Course Pack).
Review Restatement of the Law (Third) Property (Servitudes) §§ 8.3, 8.5 (pp. 209-13 of Course Pack).
Madden v. The Nature Conservancy, 823 F. Supp. 815 (D. Mont. 1992) and Madden Materials (Warranty
Deed, Answer/Counterclaim, Opinion/Order, Depositions) (pp. 339-80 of Course Pack).
Melissa K. Thompson and Jessica E. Jay, “An Examination of Court Opinions on the Enforcement and
Defense of Conservation Easements and Other Conservation and Preservation Tools: Themes and
Approaches to Date”, 78 Denv. U. L. Rev. 373 (2001) (pp. 386-410 of Course Pack).
Conservation Transaction: PREPARE YOUR ROLE BEFORE CLASS. Conduct mock trial direct
examination and cross examination of land trust and landowner witnesses. Examine easement drafting
and real-time opportunities for negotiation, mediation, and litigation to resolve potential violation; review
and revise ADR and enforcement provisions for conservation easement as necessary. Make final
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revisions to conservation easement.
4:00: Post-Class Extra Session for Questions Regarding Conservation Easement Final Draft
NO CLASS/SPRING BREAK Friday, March 19th
Revise and Compare Conservation Easement/Prepare for March 26th Role Play: Select and contact
land trust from professor’s list; introduce yourself and request copies of one conservation transaction’s
recorded copy of conservation easement. Prepare to compare conservation easement facts, funding, and
language to your draft conservation easement and fact situation. Prepare to briefly present overall and
specific comparison of transaction to role play facts, funding, and language in next classes.
Class 10 – Friday, April 5th
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