Why is the new Conservation Easement Enhancement and Rural Stimulus Act important?
This legislation opens up more opportunities for conserving land and water in Colorado, which benefits the wildlife and the people who rely on those resources. With this legislation, landowners are incentivized more than ever to voluntarily conserve land through a conservation easement – which restricts the use of the land (for example, by prohibiting building on the land) in order to protect the property’s conservation values in perpetuity, such as wildlife habitat, local farm and ranch production, and scenic views and open spaces.
The legislation is also important because it expands the definition of “landowner” to include water entities, such as water districts and ditch companies, in the list of organizations that can donate a conservation easement and take advantage of the state tax credit. This means that land and water conservation efforts can be more coordinated and thoughtfully planned – which is important for the wildlife and the people who rely on protected land and water sources.
Finally, the legislation is important for boosting economic opportunity, especially in rural areas that have been hard hit by the pandemic.
How does this legislation incentivize ranchers and other landowners?
This legislation incentivizes ranchers and other landowners who decide to voluntarily conserve their property by making them eligible to receive up to 90% of the value of the donated portion of their conservation easement in the form of tax credits, which they can transfer (sell) if they wish. This is especially helpful for rural landowners who are looking to invest in the future of their lands, stay in production or even expand their operations. Rather than sell or subdivide their ranch, for example, they can invest in conserving it.
We’re excited about this as well for traditionally underserved landowners who may not have viewed conservation as an option in the past. Ranchers and other rural landowners who are facing pressure to sell their land, or who face economic hardship due to the pandemic or other events, have a tool to stay on their land and continue producing. This contributes significantly to local economies that rely on agricultural production.
Landowners who conserve their land help create many benefits for the communities that surround them – such as providing fresh local food for Colorado and beyond; providing employment; providing healthy, contiguous habitat for wildlife who rely on these lands; providing the scenic vistas Colorado is known for; and in some cases, creating access to trails and rivers for hiking and fishing.
Has Keep It Colorado’s coalition seen a surge of interest since this bill became law?
Anecdotally, we are hearing from our land trust members that since the law went into effect earlier this summer, their phones have been ringing off the hook from landowners interested in conserving their properties. Land trusts are trying to keep up with the demand to ensure more landowners can leverage this opportunity.
We expect that as more landowners hear about the tax credit and the benefits conservation brings to them and their communities, the more they will be getting in touch with their local land trust or open space agency.
How well do Coloradans know about and understand this legislation?
The legislation is probably not as well-known and understood as it could be. What Keep It Colorado would like people to understand is that forward-thinking legislation like this helps get Coloradans get closer to their local community conservation goals as well as the state’s conservation goals.
We know through research that Coloradans in every corner of the state place a very high value on conserving natural resources. Between 89% and 91% of Coloradans we surveyed last fall say that conserving wildlife habitat, restoring forest health, and conserving lands along streams and rivers are some of the most resonant goals for land conservation. And 79%-85% say that conserving lands that are more sensitive to climate change, protecting land that is used to produce locally grown food, and conserving native prairies and grasslands are among the most important activities for land trusts to undertake.
About 60% of land in Colorado is privately owned, so there is tremendous opportunity for landowners to access incentives like the state tax credit. The state has allocated $45 million for the tax credit program, and this legislation helps Colorado get closer to reaching that set-aside.
Also, according to a CSU study, for every $1 invested in conservation, the public receives up to $12 in benefits. (A CSU Study: Investing in Colorado, 2017) And In the agricultural sector alone, new investments in conservation programs have the potential to pump hundreds of millions of dollars into Colorado’s economy, and give a much-needed boost to our rural communities, too. (Economic impact of future federal conservation easement investments on (rural) Colorado communities, 2020). (View our infographic.)
What are the key elements of the legislation?
In addition to creating a more equitable tax credit incentive and aligning water and land conservation efforts, the legislation creates better efficiencies in the tax credit program (mainly by eliminating some administrative burdens and creating a more efficient system to track and verify tax credit certificates and transfers within the Department of Revenue), and it gives the Division of Conservation the authority to serve as a receivership of orphaned easements (easements that the holder fails to monitor, or for which the holder fails to receive state accreditation).
Read more about the legislation in our fact sheet. Read more about the tax credit program.
