Conservation Easements, A Strategy to Check Development, Preserve River Flow

An incentive-based approach to conservation

by Joe Gelt

Yet another conservation easement has been worked out along the Babocomari River, making the fourth such agreement in the area since January. The total area now protected stands at 1,410.2 acres and 4.61 miles of river.

What is occurring along the Babocamari River reflects a national trend: the increased use of conservation easements as a strategy to protect natural resources. According to the Land Trust Alliance the amount of land protected by local and state land trusts using easements doubled to 6.2 million acres between 2000 and 2005.

In brief, a conservation easement is a legal agreement between a landowner and a land trust or government agency that permanently limits uses of the land for the purpose of protecting its conservation values. By agreeing to an easement landowners give up some of the rights associated with the land; they still own the land, however, and can pass it to heirs or sell it, with the easement in force.
Many and varied are the lands protected by conservation easements: coastlines; farm and ranchland; historical or cultural landscapes; scenic views; streams and rivers; trails; wetlands; wildlife areas; and working forests. In Arizona, a state anxious to preserve its few remaining flowing rivers, conservation easements are especially useful as a river management tool. Any river with private ownership of land along side it that has conservation value is a candidate for conservation easements.

Conservation easements along the San Pedro
Consider the San Pedro River: with its reduced flows raising concerns, the river is a veritable active easement area, with many conservation easements having been negotiated with more in the works. Experiences along the San Pedro demonstrate the workings of conservation easements as well as their possibilities and effectiveness as a river management tool.

The Brophy family, owners Babacomari Ranch, has been a willing partner to working out conservation easements. The ranch is located along the Babocomari River, a key tributary to the San Pedro River. In the recent agreement, mentioned above, The Nature Conservancy purchased an easement protecting 487.3 acres of grasslands that contain valuable wetland habitat. Over time, Fort Huachuca will reimburse TNC $1.9 million for the easement.

Earlier this year Fort Huachuca purchased two other ranch easements, adjacent to one another, for $830,000 to block development along the Babocomari River corridor. Later the Bureau of Land Management purchased a third ranch easement for $2.7 million that protects 674.6 acres including three and one-half miles of the Babocomari River channel.

In allowing an easement, a property owner accepts an obligation. Tom Collazo, TNC associate state director, explains: “Every conservation easement is acquiring a partial interest in a property and what type of partial interest you acquire depends on your conservation objects and what you can reasonable negotiate with the landowner, what the landowner is willing to give up in other words”

The main conservation objective along the San Pedro is to limit water use, with property owners relinquishing water rights by accepting a conservation easement. The U.S. Geological Survey has identified the shallow aquifer underlying the Babocomari River as one of the most important contributors to the San
Pedro aquifer in the upper San Pedro Valley.

Collazo says the TNC views the Babacomari ranch easements “as the first installment of a much larger, long-term program to protect as much of the Babocomari River corridor and watershed as possible. ... The Brophy family has identified about 16,000 acres of ranch they would like to see placed under conservation easements.”

Department of Defense involved with easements
Of the three key players involved in purchasing the ranch easements — The Nature Conservancy, the Bureau of Land Management and Fort Huachuca, the fort might stand out as an unlikely partner in a conservation deal. Part of its interest in the easements, however, is preventing development that would encroach on the fort and interfere with its operations. Confronting economic pressures, ranch owners and landowners are increasingly in need of financial resources to maintain their operations. By selling an easement they needn’t resort to selling their land for development. Fort Huachuca has an interest in preventing development.

Fort Huachuca also has a natural resource interest in establishing conservation easements. The fort is legally obligated under an agreement with the U. S. Fish and Wildlife Service to offset water withdrawals with water recharge by 2011 as part of an effort to conserve endangered and threatened species dependent upon the Upper San Pedro River ecosystem. The water savings resulting from the easements count as credits toward the army’s goal of reducing groundwater pumping.

Earlier TNC had worked with Fort Huachuca to acquire easements along the San Pedro River in the Palominas area, where the river crosses the border into the United States from Mexico. In that situation, TNC acquired property, then, through conservation easements, restricted groundwater pumping and development. It then resold the property to private buyers with the easements reserved. The fort paid for the easements and received credit under its biological opinion for the number of acre feet of water the easements reduced.

In the San Pedro watershed, 7,762 acres are set aside as easements, held by the TNC, BLM and the Bureau.

Three-Links Farm conservation easement
In 2002 TNC purchased the Three-Links Farm, an alfalfa farm that pumps more than 3,200 acre-feet per year. Located about 15 miles north of Benson, the farm includes more than six-miles of San Pedro River, with rare cotton weed-willow riparian habitat. At the time of purchase, the San Pedro was not flowing year round on the entire farm or for miles downstream. TNC purchased the property intending to restore and enhance both groundwater levels and surface flows through about 20 miles of the river.

Collazo says, “We turned off the pumps, and we have seen dramatic recovery of stream flow not only on the property but for quite a ways down river as well and subsequently a dramatic increase in cottonwood- willow habitat and willow flycatcher populations and number of other riparian related species.”

TNC is financing the purchase by reselling portions of the property to private owners, bound with a conservation easement. The easement greatly limited the residential development rights and restricted groundwater pumping. Property that could have been divided into hundreds of house lots was limited to ten homes. Easements reduced the 3,200 acre-feet of water used annually on the farm by 90 percent to 300 acre feet, a net saving of 2900 acre feet per annum.

The easements were sold to the Bureau of Reclamation for mitigation credit applicable to work it undertook to modify Roosevelt Dam. That project resulted in the flooding of habitat of the Southwest willow flycatcher, an endangered species. The purchase of the Three-Links Farm easements will protect habitat of the endangered bird, offsetting the loss at Roosevelt Lake.

Cost of Conservation Easements
The costs of conservation easements vary. Cost is decided by having an appraiser determined the value of the land without the easement and then its value with an easement. The difference between the two appraisals is the cost of the easement. Generally an easement diminishes the value of property from 20 to 80 percent; the average is about 50 percent.

The appraisal value depends on the market condition of the property and the type and severity of the restriction the easement imposes on the property. In the case of the Three-Links Farm a fairly substantial amount of the purchase value of the property was represented by the easement.

The value of property with an easement can be an issue when property taxes are determined. An owner of property reduced in value due to an conservation easement might not unreasonably expect that the property tax should be reduced. In Arizona, county assessors have generally not agreed. Some states have adopted legislation requiring that property tax assessments must take the diminished development potential into account.

With funds usually in short supply, organizations need to prioritize areas for their conservation easement efforts. TNC is focusing on the Verde and San Pedro rivers, although its activities along the Verde has so far been mostly purchases rather than working out easements. It is an area, however, considered ripe for further conservation easement activity.

Colazzo explains: “You focus your resources on a few places where you can retire a lot of water use or preclude a lot of new water use. You need a private landowner community predisposed to want to work with you, and you need partners, the public and political support for the funding.
“We evaluated where are all the ingredients are present, and those two rivers seem to be the places where we can see things coming together.”