APPENDIX A
(Reference NASF Resolution No. 2005-6)

Reforms of Tax Code Issues and Land Conservation Practices Proposed by the
Joint Committee on Taxation of the United States Congress

Policy Statement
National Association of State Foresters

The National Association of State Foresters is proud of our nation’s conservation record and supports efforts to continue the conservation of our nation’s natural resources.  Conservation easements have been valuable to our nation’s conservation history, resulting in many public benefits, including water quality protection, conservation of wildlife habitat, open space conservation, conservation of farmland and timberland, maintenance of the character of rural communities, buffering of public lands, and landscapes for recreational, scenic and inspirational purposes.

Land protected by conservation easements continues to provide tax revenue and local jobs, while allowing for protection at relatively low costs to governments.  As a result, easements can help to make limited public funds available for more sensitive ecosystems, thus strengthening conservation efforts as a whole.

The National Association of State Foresters is dedicated to preserving the practice of granting individuals and organizations the ability to deduct charitable donations of easements for landscape conservation and historical preservation in recognition of the public benefits derived from private forestland stewardship.  Tax incentives for charitable donations have helped preserve millions of acres of farmland and timberland across the country. 

The National Association of State Foresters recognizes the rising scrutiny and need for attention on recently documented abuses and problems regarding certain conservation easements.  However, the select few abuses of the current system do not warrant its complete abandonment or dismantling.  There is a need for stricter appraisal training and certification requirements, along with stricter application, documentation, monitoring, compliance, and enforcement procedures.

The National Association of State Foresters agrees with the recent changes made to standardize conservation easement donation procedures within The Nature Conservancy (TNC) and Land Trust Alliance and suggests these be used as models for the future.  Over the last two years, TNC has, with the assistance of an independent advisory panel, instituted several changes to increase organizational oversight.  Appraisers of donations to TNC must certify that it follows IRS qualified appraisal standards, and for donations from people affiliated with TNC, that the donor’s relationship did not influence the appraisal.  Additionally, TNC adopted many principles of the Sarbanes-Oxley Act of 2002 in their audit policy.  The Land Trust Alliance revised its Land Trust Standards and Practices in 2004 in part to address recent public scrutiny of non-profit practices, including managing conflicts of interest, conducting transactions with “insiders,” and taking greater responsibility for seeing that tax code requirements are met.  All member land trusts must adopt the Land Trust Standards and Practices.

The National Association of State Foresters Supports the Following Statements:

1. The recommendations of the recent report issued by the Joint Committee on Taxation, Options to Improve Tax Compliance and Reform Tax Expenditures, would severely limit charitable deductions for conservation easements. This would threaten to eliminate an important tool that is widely used by states and conservation partners to conserve important natural resources.

2. Legislation attempting to eliminate or dismantle the current system and practice of allowing individuals and organizations to deduct charitable donations for conservation easements should be strongly opposed.

3. Proposed legislation that could potentially inhibit landowners or non-profit organizations from donating land or participating in conservation efforts due to complex, unrealistic requirements should be defeated.

4. Stricter enforcement of existing laws regulating taxation is needed, rather than the creation of new legislation.

5. More stringent appraisal certification and training requirements need to be established, along with stricter standards, monitoring, enforcement, and penalty requirements associated with the donation of conservation easements.