Texas Agricultural Land Trust:
Process for Completing Conservation Easements
Timeline for Easement Process:
It generally takes a minimum of six months to go through the process of developing a conservation easement. The earlier in the year that the process is started between TALT and the landowner, the better.
TALT Year-End Easement Closing Date:
Depending on the number of projects that are being worked on, TALT does not accept new projects after September 15th for year end closings.
Landowner Legal Counsel:
TALT strongly advises that landowners obtain legal counsel to help guide them through the process.
The landowner and TALT must go through the following process in order to protect a property with a conservation easement:
1. Landowner Information Packet:
The first step in the process is obtaining a Landowner Information Packet from TALT. We ask that landowners look over this and learn about the organization. The packet includes information about the history, mission, and successes of TALT. This information is provided in order for the landowner to evaluate whether TALT is the appropriate land trust to meet the landowner’s conservation needs.
2. Landowner Project Application:
After discussing the potential easement with the TALT, a Landowner Application will be sent out. The application should be completed by the landowner and sent back to TALT along with a $1,000 deposit. The landowner will also receive and sign TALT’s Transaction Memo outlining all costs associated with the easement. The landowner will either pay for directly or reimburse TALT for the following expenses: Appraisal; Baseline report; Legal fees; Mineral remoteness report (if needed); and Title policy.
3. Site Visit:
TALT staff and/or director make an on-site visit to the property. During this visit, TALT will also meet with all identified owners of the property and their family members to ensure that all are committed to the project. The owner(s) will select a contact person to work with TALT. At this time, TALT staff will also review with the owner(s) the easement template to identify any key concerns or issues.
4. Project Approval from the Board of Directors:
After the site visit, the application will be presented to the TALT Board of Directors for approval. TALT staff will inform the landowner of the decision of the Board. At this time, the Board may request an additional deposit to cover expenses.
5. Required Documentation From the Landowner:
The landowner will obtain, at his/her cost, and send to TALT information on ownership, including copy of trust, family limited partnership, or other ownership agreements, and executed copies of all mineral leases and surface use agreements. In addition, TALT requires the following:
- Title Report: TALT requires that title commitment be ordered for the proposed property. This is something that TALT can assist the landowner with, if needed.
- Appraisal: The landowner will contact a qualified, experienced appraiser to assess the conservation value of the property. TALT requires that appraisers provide us with a copy of the final appraisal. Prior to signing off on any tax documents, TALT staff will review the appraisal and if there are concerns TALT will have another appraiser review it.
- Mineral Remoteness Assessment: IRS requirements state that if the landowner does not own all of the mineral rights associated with the property, a mineral report will be required. The Mineral Remoteness Assessment needs to be completed by a hired contractor qualified in that specific area.
6. Baseline Inventory Report:
IRS and Land Trust requirements state that a Baseline Inventory Report needs to be completed prior to the closing of the easement, indicating the present condition of the property prior to the easement being placed on the property. TALT will obtain the present conditions report, which is prepared in cooperation with landowner. TALT and landowner both approve and sign the report.
7. Deed of Conservation Easement:
Once all reports, documents and maps are assembled, TALT staff, TALT’s legal counsel, the landowner, and the landowner’s legal counsel will draft the Deed of Conservation Easement tailored to the specific needs of the landowner. At this point, the preliminary title report will be updated and reviewed. All monetary liens must be released or subordinated to the conservation easement prior to closing the easement transaction.
8. Title Policy:
If the amount of the value of the conservation easement is not known at the time the title commitment is ordered, TALT suggests to use 1/3 of the county tax appraisal value of the real property. The policy can be amended to reflect the actual appraised value of the conservation once it is known.
9. Easement Approval from the Board of Directors:
Once agreed upon by TALT staff and the landowner, the final Deed of Conservation Easement will be presented to the Board of Directors for approval.
10. Easement signing and recording:
The Deed of Conservation Easement will be signed by the Board President with a notary present. The document will then be signed by the landowner(s) with a notary present. The signed easement will be delivered to the County Clerk and Recorder to be entered into the County records. Monitoring endowment, cost recovery and landowner contribution will be paid to TALT at closing.
11. Project dedication and publicity:
TALT will work with the landowner to plan a dedication or recognition of the easement. Depending on landowner’s wishes, TALT will develop a publicity plan which may be as simple as a gate sign or involve a press release.
12. Annual monitoring:
Upon the one-year anniversary of the recording of the easement, TALT will work with the landowner to schedule annual monitoring visits.