Table Of Content

THE CONSERVATION EASEMENT IN CALIFOI\NIA THE CONSER.VATION EASEMENT IN CALIFORNIA by Thomas S. Barrett & Putnam Livermore for The Trust for Public Land Island Press Covelo, California Copyright ©1983 by The Trust for Public Land. All rights reserved. No part of this book may be reproduced in any form or by any means without permission in writing from the publisher: Island Press, Star Route 1, Box 38, Covelo, California 95428. Printed in the United States of America. First printing Library of Congress Cataloging in Publication Data Barrett, Thomas S., 1947- The conservation easement in California. Bibliography: p. Includes index. 1. Servitudes-California. 2. Land use-Law and legislation-California. 3. Natural resources-Law and legislation-California. I. Livermore, Putnam, 1922- II. Trust for PubliC Land (U.S.) III. Title. KFCI63.5.B37 1983 346.79404'35 83-4329 ISBN 0-933280-20-3 347.9406435 ISBN 0-933280-19-X (pbk.) Text and cover designer: Judith Barrett Editor and production coordinator: Linda Gunnarson Proofreaders: Carey Charlesworth and Netty Kahan Typesetters: Dharma Press (text), Ad Comp and Solotype (titles and cover type), all of Oakland, California Printer and binder: BookCrafters, Chelsea, Michigan CONTENTS FOREWORD xi ACKNOWLEDGMENTS xiii INTRODUCTION 1 CHAPTER ONE CONSERVATION EASEMENT LEGISLATION IN CALIFORNIA 9 LEGISLATIVE HISTORY 9 SUMMARY OF THE KEY LEGISLATION 20 Open-Space Easement Act of 1974 (Gov't Code §§ 51070-51097) 21 California Conservation Easements Act of 1979 (Civ. Code §§ 815-816) 27 Scenic Easement Deed Act of 1959 (Gov't Code § § 6950-6954) 34 Land Conservation Act of 1965-Williamson Act (Gov't Code §§ 51200-51295) 34 RELATED LEGISLATION 36 Article XIII, Section 8 (Formerly Article XXVIII) of the California Constitution 36 1970 Amendments to the Planning and Zoning Law: Open Space Land (Gov't Code §§ 65560-65570) and Open Space Zoning (Gov't Code §§ 65910-65912) 37 California Timberland Productivity Act of 1982 (Formerly Z'berg-Warren-Keene-Collier Forest Taxation Reform Act of 1976) (Gov't Code §§ 51100-51155) 38 Open Space Subventions, 1972 (Gov't Code §§ 16140-16154) 38 v CONTENTS Open Space Amendments to Regional Park Districts Law, 1975 and 1982 (Pub. Res. Code §§ 5500-5595); Recreation and Park Districts (Pub. Res. Code § § 5780-5791) 39 Roberti-Z'berg Urban Open Space and Recreation Program Act, 1976 (Pub. Res. Code §§ 5620-5632) 39 Open Space Maintenance Act, 1965 (Gov't Code §§ 50575-50628) 40 Absolute Immunity of Public Land Trusts from Personal Injury Liability on State-sanctioned Public Access Lands; Qualified Immunity for Recreation on Private Lands (Gov't Code § 831.5 and Civ. Code § 846) 40 Presumptions Affecting the Burden of Proof in Eminent Domain Proceedings (Code of Civ. Proc. §§ 1240.670, 1240.680 and 1240.690) 42 State Coastal Conservancy (Pub. Res. Code §§ 31000- 31405); Santa Monica Mountains Conservancy (Pub. Res. Code §§ 33000-33216) 42 Keene-Nejedly California Wetlands Preservation Act, 1976 (Pub. Res. Code §§ 5810-5818) 44 CHAPTER TWO TAX INCENTIVES FOR THE DONATION OF CONSERVATION EASEMENTS 45 FEDERAL TAX LAW 45 Background of the Federal Income Tax Deduction 45 The 1980 Federal Conservation Easement Income Tax Deduction (I.R.C. §§ 170(f)(3)(B) and 170(h)) 48 Public Benefit 51 Valuation 58 Perpetuity 60 Relation to the California Open-Space and Conservation Easements Acts 63 Administrative Matters 68 Wild and Scenic Rivers Act 69 Federal Estate and Gift Tax (I.R.C. §§ 2055(e)(2), 2106(a)(2)(e) and 2522(c)(2); § 2032A) 69 Capital Gains Tax 71 vi CONTENTS STATETAXLAW 71 California Income Tax (Rev. & Tax. Code §§ 17214.2, 17214.7,24357.2 and 24357.7) 71 California Inheritance Tax (Rev. & Tax. Code §§ 13957, 13841 and 13842); Open Space Land Dedication, 1978 (Gov't Code §§ 7301-7309) 71 California Property Tax 73 Open Space Property Tax Assessment (Rev. & Tax. Code §§ 421-430.5) 73 Related Property Tax Assessment Legislation 75 Assessment Valuation of Section 815 Conservation Easements 75 Impact of Proposition 13 77 Welfare Tax Exemption (Rev. & Tax. Code § 214); Special Provision for Open Space Lands (Rev. & Tax. Code § 214.02) 78 CHAPTER THREE DRAFTING THE CONSERVATION EASEMENT 81 CONSERV AnON EASEMENT CHECKLIST 83 Parties 83 Legal and Qualitative Description of the Property 84 Type and Purpose of Easement 84 Statement of Intent of Grantor and Grantee 85 Reference to Documentation of Conservation Values To Be Preserved 85 Grant of Easement 86 Rights, Restrictions, Permitted Uses and Reservations 86 Allocation of Costs 91 Subsequent Deeds 92 Executory Limitation 92 vii CONTENTS Assignment 92 Integration 93 Severability 93 Costs of Enforcement 93 Habendum Clause 93 Date, Signatures and Acknowledgment 93 Exhibits 94 CHAPTER FOUR CATALOG OF OTHER REAL PROPERTY CONSERVATION TECHNIQUES 95 DEFEASIBLE FEE TECHNIQUES 95 FULL FEE TECHNIQUES 101 Purchase and Lease-back or Sell-back Arrangement 102 Bargain Sale 103 Installment Sale 104 Sale or Gift of an Undivided Interest in Land 105 REMAINDER INTEREST 107 PURCHASE OPTION, RIGHT OF FIRST REFUSAL AND COVENANT NOT TO SELL 107 LEASE 110 TRANSFER IN TRUST 111 COMMON LAW EASEMENT 113 RESTRICTIVE COVENANTS AND EQUITABLE SERVITUDES 115 CONCLUSION 119 APPENDIX 1: LEGISLATION 121 Conservation Easements Act of 1979 (Civ. Code §§ 815-816) 121 viii CONTENTS Open-Space Easement Act of 1974 (Gov't Code §§ 5lO70-51097) 123 Federal Tax Deduction: Tax Treatment Extension Act of 1980 (I.RC. §§ 170(f)(3) and 170(h)) 132 APPENDIX 2: SAMPLE CONSERVATION EASEMENT 135 NOTES 143 SELECTED BIBLIOGRAPHY 157 INDEX 165 ix