[This is draft guidance that has been published for peer and public review. Upon consideration of all comments, WeConservePA will publish the finalized piece. Send comments to [email protected]]

Perpetual vs. Temporary

From the moment a perpetual conservation easement is executed, every decision affecting the property is made against the backdrop of permanence. The conservation gains that result from the easement holder’s efforts to administer, monitor, and enforce the easement remain with the land. As time passes, landowner certainty is consistently reaffirmed and public confidence in the promise of the conservation deepens. The perpetual nature of the easement is fundamental to achieving and sustaining these outcomes.

So-called “non-perpetual conservation easements,” sometimes referred to as “term easements,” should not be viewed simply as shorter versions of perpetual easements, but as something different in kind. This is because the fact of impending termination can negatively impact management decisions of both the landowner and the holder throughout the term of the arrangement, while ultimately leaving public conservation gains vulnerable to permanent loss. Even referring to these arrangements as conservation easements obscures their critically compromised public conservation value. Their limited utility is better captured with an alternative descriptor, such as “temporary use restriction.”

Not a Bridge to Permanence

Temporary use restriction proposals sometimes emerge where landowners are interested in conservation but wary of permanence. The prospective holder of the restriction might perceive an opportunity to get a foot in the door, with the hope of achieving perpetual protection later. This strategy will likely backfire:

• Once the temporary use restriction is in place, it becomes exceedingly easy in the early years of the restriction for both parties to put off further thought about permanence in favor of more pressing matters.
• In the later years of the restriction, the unrestricted value of the land will likely have risen substantially, incentivizing the landowner not to renew the restrictions on a now much more valuable property. This shift may place a purchase of the land or a permanent easement beyond the holder’s financial means.
• The passage of time increases the likelihood that the landowners who placed the temporary restriction will pass ownership of the land onto others with no conservation intent—people who will liquidate any natural resources of financial value or develop the land upon expiration of the restriction.
• Even if a landowner expresses intent to renew successive easement terms, the holder should not discount the likelihood of painful renegotiations, unforeseen ownership changes, or changes of circumstance.

Compromised Conservation

Even with identical conservation objectives and covenants, one year under a temporary use restriction does not deliver conservation results equivalent to one year under a perpetual conservation easement. This is because the fact of impending expiration affects (1) landowners’ management decisions; and (2) holder’s stewardship decisions.

Landowner Incentives Degraded

The granting of a perpetual conservation easement creates an immediate and ongoing incentive for the landowner to balance their short- and long-term interests. Perpetual restrictions require an economically rational landowner to manage the land to maximize its future value as restricted by the easement.  In the non-perpetual context, the impending burn-off of restrictions—and the concurrent ability to exploit other development or extraction value of the land—will necessarily influence present-day land management decisions. Even easement-compliant decisions may skew toward inferior conservation outcomes. For example:

• Forestry Practices. Where a temporary use restriction permits forestry subject to a sustainable forest management plan, it is economically rational to select regenerative practices that prioritize short-term returns, and to limit investments in long-term forest health, knowing that the land’s future economic value includes the potential for development, unfettered harvest for quick cash-out, or other non-renewable enterprise. Under a perpetual conservation easement, the rational landowner must be concerned with maintaining the land’s long-term productive capacity, knowing that this will be a primary driver of the land’s market value forever.
• Building Rights. Where a temporary use restriction includes a permission to construct specific improvements subject to the holder’s review and approval, the sunset of the restrictions will influence how, when, and where the rights are exercised. Rather than developing the site subject to holder’s conservation-focused requirements, it may be economical to defer development until the restrictions expire. Or worse, a landowner might leverage the fact of near-future termination to force a compromise during the restriction’s term. Under a perpetual conservation easement, these incentives are eliminated; the owner must build in accordance with the easement, or not at all.
• Speculation. Undeveloped land is often held speculatively, with owners anticipating future increases in value as development pressure grows. A savvy landowner might pursue the sale of a temporary use restriction to generate modest current income during a period in which profitable development was already unlikely, while teeing up a windfall if development pressure has increased when restrictions expire. When this occurs, a potentially substantial portion of the charitable and public resources invested to establish and administer the easement are effectively converted to private returns.

Holder’s Powers Undermined

The initial costs and annual stewardship burdens of a non-perpetual conservation easement are identical to those of a perpetual easement, but the impending termination of restrictions will erode holder's power and incentive to enforce with each passing year. With a perpetual easement, a potentially costly enforcement action is a long-term investment, protecting perpetual conservation value while creating precedent concerning the property. An easement holder may reasonably conclude that it would be a violation of its charitable mission to divert substantial resources to start a costly enforcement action in year 25 of a 30-year easement. This impracticability is likely to drive awful compromises at conservation’s expense.

Conclusion

Absent extreme and unusually compelling circumstances, temporary use restrictions are likely worse than no easement at all–pairing potentially illusory conservation gains with a substantial drain of limited charitable resources. The time, money, and energy needed to establish and enforce them would likely drive superior conservation outcomes if applied to any number of alternative projects grounded in perpetuity.

The sharp loss in public value of a temporary use restriction as compared to a perpetual conservation easement is illustrated throughout public and private conservation policy. For example, federal tax deductions are unavailable for donations of non-perpetual easements. Non-perpetual easements are not eligible for conservation defense insurance through Terrafirma, a member-owned risk retention group insuring conservation easement enforcement.

As part of this guide’s development, WeConservePA issued open calls to conservation networks requesting examples of compelling use cases for temporary use restrictions, as well as any principled objections to the points contained in the guide. None were received. The authors continue to welcome examples and feedback, which may be sent to [email protected]. In the meantime, conservationists should approach temporary use restrictions with the greatest caution and skepticism.