Land Use “Controls”

1. Land Use “Controls” • Public Lands – federal, state, and local government • Private Lands • Public controls on how private landowners exercise their real property rights • Regulation • Financial incentives “subsidies” – taxes, loans, grants • Public construction of infrastructure

2. Protecting the Ecological Continuity of Real Property • Concern about regulating landowners using the surface in ways that degrade the ecological characteristics of an area or structure • Governments have assumed responsibility for protecting particular ecological characteristics – open space, agricultural land, biodiversity • Protection becomes a good, such as an automobile, or service, such as education

3. Public owners- Historic/Cultural structures – areas (battlefields)--structures----facades; open space, scenic vistas (protecting visibility) • Public and private owners - biological diversity --- rare and endangered species ----- communities ----- ecosystems, forest land, wetlands, shorelands, floodplains, water bodies • Private owners – agriculture • Different strategies used over space and time ya think?

5. A culture clash on the St. Croix (Star Tribune March 26, 2010) • City's powers upheld in St. Croix dispute (Star Tribune April 29, 2010) • Citizens will debate new state rules (Star Tribune June 23, 2010) • Lakefront Development: Rulings, regs are a big mess (Star Tribune October 9, 2010) • Shoreland Management (DNR) • New rules will protect Mississippi shore (Star Tribune Oct. 12, 2010)

6. Comprehensive Planning • Protection built in to comprehensive plans • Metropolitan Council 203 Regional Development Framework • Dakota County’s Comprehensive Plan • Minneapolis Comprehensive Plan • State Comprehensive Outdoor Recreation Program

10. Minnesota Recreation

11. Public Lands

12. All Land Use

13. Preserving Agriculture • Minnesota Agricultural Land Preservation Statutes • Perceived as an urban or metropolitan area problem where often regarded as much an ecological and open space issue as it is an economic and livelihood issue • “The preservation of America’s prime agriculture lands is deemed by many policy-makers to be a vital long-term strategic interest” • Minnesota Agricultural Land Preservation Program • (1) preserve and conserve agricultural land, including forest land, for long-term agricultural use in order to protect the productive natural resources of the state, maintain the farm and farm-related economy of the state, and assure continued production of food and timber and agricultural uses • (2) preserve and conserve soil and water resources • (3) encourage the orderly development of rural and urban land uses • Agricultural Preserves

14. Tools • The goals of the policy “will be best met by combining state policies and guidelines with local implementation and enforcement procedures and private incentives” • 1967 Minnesota Agricultural Property Tax Law established the “Green Acres” program • The statute protects agricultural landowners from high property taxes that are caused by nonagricultural market forces, urban and recreational development • Land values are usually assessed based on the highest and best use • Under the program, counties assess eligible agricultural land based on agricultural use • In fiscal year 2006, the program reduced taxes on agricultural land in 43 counties by about $42.8 million

15. Agricultural Zones • Cities • Comprehensive Municipal Plans • Farm Lands • Dakota County Farmland and Natural Areas Program • Washington County Farmland and Open Space Preservation Tools • “Protecting open space in and around the Twin Cities Metropolitan Area” in Bengston, David N. (tech. ed.). Policies for Managing Urban Growth and Landscape Change: A Key to Conservation in the 21st Century. General Technical Report NC-265. St. Paul, MN: USDA Forest Service, North Central Research Station. pp.14-20

16. Farmland Preservation (United States Department of Agriculture) • Minnesota Agricultural Land Preservation Program (Minnesota Department of Agriculture)

17. Historic Preservation • Federal Lands • National Park Service • Archeology Program • America’s National Monuments • Discover History • National Battlefields • Cultural Resource Management • Preservation Nation (National Trust for Historic Preservation) • Minnesota • Historic Sites (MHS) • Private Lands (in Minnesota) • State Archeologist • State Historic Preservation Office • Historic St. Paul • Minneapolis Landmarks and Historic Districts (Minneapolis Heritage and Preservation Commission) • Minnesota Historic Tax Credits • National Register of Historic Places

18. Federal Law • Title 16 United States Code. Conservation • Federal Historic Preservation Statutes • Title 36 CFR. Parks, Forests and Public Property • Title 43 CFR. Public Lands • An Overview of Federal Historic Preservation Law, 1966-1996 • State Law • Minnesota Statutes c.138 Historical Societies • Minnesota Statutes 86A.05 • Minnesota Rules c.1311 Rehabilitation of Older Building

19. Open Space State Partners • Regional Parks • In 1974 Metropolitan Parks Act created a partnership between the Metropolitan Council, the regional planning agency, and the local governments operating the units that belonged to the Regional Recreation Open Space System • 46 regional parks and park reserves • 22 trails and six special recreation areas • Parks are operated by the respective cities and counties • Dakota County Parks • Minneapolis Park & Recreation Board • St. Paul Parks & Recreation

20. Protecting Biodiversity • US Fish & Wildlife Service in Minnesota • National Wildlife Refuge Legislation • Upper Mississippi Fish & Wildlife Refuge • Minnesota Valley National Wildlife Refuge • Minnesota Valley National Wildlife Refuge Protection Act of 1999 • Impact of Airport Expansion on the Minnesota Valley NWR (House Committee on Resources)

21. Protecting Biodiversity • Minnesota Department of Natural Resources • Scientific and Natural Areas • Invasive Species • DNR Programs to assist local governments and individuals

22. Protecting Biodiversity • U S Fish and Wildlife Service • U S Fish and Wildlife Service Endangered Species Program • Minnesota’s Endangered Species Law • Endangered Species in Minnesota • Grey wolves return to endangered species list

23. Protecting Privately Owned Land • Public Acquisition – take away the private rights • Private Action • Regulatory – restrict the exercise of some of the private rights • Financial Incentives – coerce owner to exercise rights in particular way • Deed restriction or covenant – impose conditions on future owner • Define a new property right that protects ecological continuity, one which can be conveyed to the public or a quasi-public entity

24. A Paradigm for Landscape • Public Acquisition of Private Rights Public Coercion of Private Rights • Fee title Regulation • Partial title –easement Financial coercion – loans, grants • Infrastructure – public works, public records • Information • Public Land Private Land

25. The Private End of the Production Spectrum • “Private” Arrangements not regulation – government defined, protected, and enforced • Transfer of Development Rights • Covenants – agreements between developers and subsequent owners • Easements – conservation, rights-of-way, drainage, pipeline, solar, wind

26. Protecting Privately Owned Land as Open Space • Approximately 60 acres of land lost locally in the Twin Cities each day • Need to restore and protect open space and natural areas within the metropolitan region increases

28. Conservation Easements • “Conservation easements, as we know them today, are a fairly recent approach to land conservation. As government acquisitions and regulatory restrictions on land use have become prohibitively invasive, costly, and ineffective, governments have looked to conservation easements as a potentially effective and less expensive conservation method than government ownership and/or regulation” (National Policy Analysis) • A conservation easement is a restriction placed on a piece of property to protect the ecological values of the parcel • The easement is either voluntarily sold or donated by the landowner, and constitutes a legally binding agreement that prohibits certain types of development from taking place on the land • Like other easements it “runs with the land” • May be eligible for federal and state tax deductions • Land Conservancy of McHenry County

29. Conservation Easements as Real Property Rights • Uniform Conservation Easement Act (1981) • Conservation Easements (Minnesota Statutes) • United States defined the donation of conservation easement as a charitable contribution • Minnesota defined the conservation easement as a real property interest

30. Financial Incentives to Conservation Easements • Tax benefits for gifts of conservation easements were first provided by Congress to promote conservation in the United States in the Tax Reform Act of 1976 and the Tax Reduction and Simplification Act of 1977 • In 1980 Congress passed the Tax Treatment Extension Act (creating IRC section 170(h)), which made permanent the income tax charitable deduction benefits for gifts of qualified conservation contributions • In 1997 Congress passed the Taxpayer Relief Act, which created a new estate tax benefit (IRC section 2031(c)) for landowners who donate conservation easements

31. 26 USC US Internal Revue Code • § 2522. Charitable and similar gifts • (d) Special rule for irrevocable transfers of easements in real property • A deduction shall be allowed under subsection (a) in respect of any transfer of a qualified real property interest (as defined in section 170 (h)(2)(C)) which meets the requirements of section 170 (h) • Subtitle A > CHAPTER 1 > Subchapter B > PART VI > § 170(h)(2)(C)

32. The conservation purpose must be exclusive • The conservation purpose must be protected in perpetuity • No surface mining is permitted • In general where there is a retention of a qualified mineral interest a contribution does not qualify if there may be extraction or removal of minerals by any surface mining method • With respect to any contribution of property in which the ownership of the surface estate and mineral interests were separated before June 13, 1976, and remain so separated the contribution does qualify if the probability of surface mining occurring on such property is so remote as to be negligible

33. General Rule • There shall be allowed as a deduction any charitable contribution - payment of which is made within the taxable year • A ''charitable contribution'' means a contribution or gift to or for the use of • A state, a possession of the United States, or any political subdivision of any of the foregoing, or the United States or the District of Columbia, but only if the contribution or gift is made for exclusively public purposes • A corporation, trust, or community chest, fund, or foundation

34. Qualified Conservation Contribution • Qualified conservation contribution means a contribution • of a qualified real property interest • to a qualified organization • exclusively for conservation purposes • A qualified real property interest means any of the following interests in real property • the entire interest of the donor other than a qualified mineral interest, • a remainder interest, and • a restriction (granted in perpetuity) on the use which may be made of the real property

35. Qualified Organization • Organized and operated exclusively for religious, charitable, scientific, literary, or educational purposes, or to foster national or international amateur sports competition (but only if no part of its activities involve the provision of athletic facilities or equipment), or for the prevention of cruelty to children or animals • No part of the net earnings of which inures to the benefit of any private shareholder or individual; and • Which is not disqualified for tax exemption under section 501(c)(3) by reason of attempting to influence legislation, and which does not participate in, or intervene in (including the publishing or distributing of statements), any political campaign on behalf of (or in opposition to) any candidate for public office

36. A Conservation Purpose • The preservation of land areas • for outdoor recreation by, or the education of, the general public, the protection of a relatively natural habitat of fish, wildlife, or plants, or similar ecosystem, the preservation of open space (including farmland and forest land) where such preservation is • for the scenic enjoyment of the general public, or pursuant to a clearly delineated Federal, State, or local governmental conservation policy, and will yield a significant public benefit, or the preservation of an historically important land area or a certified historic structure

37. Certified Historic Structure • Any building, structure, or land area which • is listed in the National Register, or • is located in a registered historic district (as defined in section 47(c)(3)(B)) and is certified by the Secretary of the Interior to the Secretary as being of historic significance to the district • A building, structure, or land area satisfies the preceding sentence if it satisfies such sentence either at the time of the transfer or on the due date (including extensions) for filing the transferor's return under this chapter for the taxable year in which the transfer is made

38. Federal Tax Benefits • Federal income tax deduction • Donated conservation easements are considered a qualified charitable donation under the federal tax code, property owners can deduct the value of the easement, defined as the difference between the value of the land just before the easement is granted and the value of the land immediately after the donation • In August 2006, Congress passed the revised Pension Protection Act raising the maximum federal tax deduction for conservation easements from a maximum of 30% of adjusted gross income to 100% for farmers and ranchers, and to 50% = for non-farmers. • The increase expired at the end of December 2007, but a provision now pending in the Food and Energy Security Act of 2007 (the "farm bill") would extend the tax deductions for two more years

39. Federal Tax Benefits • 2. Federal estate tax deduction • Relief from estate taxes is the most significant tax benefit for landowners granting conservation easements, particularly those who inherit sizable estates • In 1997, Congress passed estate tax relief legislation for conservation easement grantors • The purpose was to encourage property owners to hold on to property they might otherwise want to sell to land developers to offset estate tax burdens • The tax provisions allow the grantor to deduct the value of the easement from the fair market value of the deceased's estate • The donor may also deduct up to 40% of the value of the estate at the time the owner dies

40. State income tax credits • Twelve states provide tax credits, though most are not as substantial as the federal income tax benefit. • The most significant tax incentives are provided by Colorado and Virginia, which allow grantors to sell partial or full amounts of their credit to other taxpayers in the state • 2. Property tax relief • At least 17 states also provide property tax incentives, allowing donors to deduct the value of the easement from the assessed value of the property

41. Easements and Land Trusts

42. Land Trusts (Wikipedia) • Land Trust Alliance • The Nature Conservancy • Nature Conservancy Minnesota • Minnesota Land Trust • The Trust for Public Land • The Trust for Public Land Minnesota

43. The nation's 1,663 local, state and regional land trusts control land use on 12 million acres of private lands • Approximately half that amount - 6.2 million acres - is controlled through conservation easements, up from 2.5 million acres in 2000 • Most of the controlled land is managed by large, national environmental organizations, such as The Nature Conservancy, The Trust for Public Land, Ducks Unlimited, American Farmland Trust and The Conservation Fund.  • Over three million acres is protected through conservation easements by The Nature Conservancy, a fivefold increase since 1997, when the land trust held 645,000

44. Dakota County Farmland and Natural Areas Program • Area of rapid urbanization south of St. Paul/Minneapolis • Plan to protect a variety of open spaces and prevent farmland and other open space, primarily along protected waterways, from being lost • inventory and rank the quality of natural areas and farmland • 42,000 acres of farmland and 36,000 acres of natural areas, about 2 percent of the County, have been identified as eligible for the program • B. protect the ecological continuity of these areas

45. Dakota County • November 2002 voters in Dakota County approved the sale of $20 million in bonds to acquire real property interests, either fee title or permanent conservation easements, from private landowners • In the program most protected land would remain privately owned, the landowners paid for keeping land open • Some land will be acquired by public entities • Practice • permanent easements on privately owned high quality farmland within ½ mile of DNR rivers and streams outside of the area planned for orderly extension of city sewer and water services acquired by county • permanent easements  on privately owned natural resources acquired by county and fee title acquired either by nonprofits or public agency

46. Farmland Protection • To date the county has acquired six easements on farmland totaling 637 acres at a total cost of $2.4 million  • Federal matching funds and landowner donation have reduced the county’s cost to $1 million • Nine other farmland properties, totaling 1330 acres, are being negotiated • County has been awarded $993,925 in matching funds from the United States Department of Agriculture Natural Resources Conservation Service for farmland protection • A total of $3.3 million in such funds have been awarded to the program

47. The Trust for Public Land acquired a 22-acre remnant of the Big Woods from private landowners conveyed 15 acres of woods to the City of Wayzata conveyed 7 acres containing building and lawn to The Retreat, a private nonprofit organization encumbered both titles with perpetual conservation easements held by the Minnesota Land Trust Funding $3 million public bond referendum passed by Wayzata citizens in November 2003 the Retreat's own financing private contributions from residents in and around Wayzata

48. Trust for Public Land Acquisitions • Wayzata Big Woods • Eagan Greenway • Anoka Wildlife • Twin Cities Mississippi Program • Minnesota Greenprinting

49. Minnesota Department of Natural Resources • Koochiching-Washington Forest Legacy Project • Breaking up the forest • Integrated public and private land management. A comprehensive landscape approach to land and water health • Protecting Natural Areas and Farmland • Wild and Scenic River Scenic Easement Program

50. Community Land Trusts • Rondo Community Land Trust • Community Land Trust creates Affordable Housing in Minneapolis (HUD) • City of Lakes Community Land Trust • Central Minnesota Housing Partnership - Community Land Trust • Northern Communities Land Trust • Two Rivers Community Land Trust