Fee Land Ownership
What is Fee Land Ownership?
The Land Trust sometimes conserves land by owning it outright. Landowners may donate the property or, in special cases, sell the title and all rights and interest to the Land Trust. The Land Trust retains the land for conservation purposes and is responsible for managing it forever.
The Land Trust also sometimes grants conservation easements on land it owns to an appropriate public agency—for example, to the state or county for park purposes.. More often, it conveys the fee title to a public agency and reserves a conservation easement to ensure the agency respects the reasons the land was protected.
Before the Land Trust acquires a property, the project must meet the trust’s evaluation criteria and be approved by its board of directors. The primary ways the trust acquires land are described below (Land Trust staff members also can discuss other options for conveying land or development rights to the Land Trust):
Donation
When landowners donate property to the Land Trust, they are giving the Land Trust the property’s title and all of its rights and interest. Like conservation easement donations, land donations can qualify as tax-deductible charitable donations if they benefit the public by permanently protecting important conservation resources and meet other federal tax code requirements.
Sale
The Land Trust sometimes purchases land with extraordinary conservation resources. The Land Trust may decide to seek grant funding and private donations to buy such a property when a landowner is not in a position to donate it. The Land Trust also can work quickly to raise private donations and find creative financing solutions when critical conservation properties fall under immediate threat from development.
Bargain sale
In a bargain sale, a landowner sells his or her land to the Land Trust for less than its fair market value. Besides making the purchase more affordable for the Land Trust, the landowner can claim the difference between the sale price and the fair market value as a charitable donation. A bargain sale also may reduce capital gains taxes for the landowner. The Land Trust may decide to seek grant funding and private donations for the purchase of a bargain sale.
Life estate
Landowners who want to give their land to the Land Trust for permanent protection but wish to continue living on the property may consider a life estate. With a life estate, landowners retain their right to live on the property while donating the property’s remainder interest to the Land Trust. With such a donation, landowners must uphold the property’s conservation values and continue to be responsible for its maintenance, taxes, and insurance. Upon their death or a specified date, the Land Trust assumes complete ownership. Landowners can qualify for a tax deduction based on the value of the remainder interest that is donated to the Land Trust. The value of remainder interest is determined by IRS actuarial tables.
Trade lands
The Land Trust welcomes the donation of property that is not suited for conservation. The Land Trust can sell this type of property, known as “trade lands,” and use the proceeds to continue its mission of protecting important island land and water. In some cases, when a donated property has some value for conservation but the Land Trust is not the appropriate owner, the Land Trust may sell the property and reserve a conservation easement.
