Facilitating voluntary donations of conservation land is increasingly important as land values escalate and open space becomes an expensive commodity. The out-of-pocket expenses involved in a donation of land (including attorney fees and appraisal costs) have discouraged many lower and middle income landowners from completing such donations. S. 1626/H. 2079/H. 1295 creates a new financial incentive for landowners to voluntarily conserve their land. This legislation amends existing state law to include the following provisions:

• Creates a state income tax credit for permanent gifts of land or interest in land to public agencies and qualified private non-profit, charitable organizations.

• Lands which qualify must be certified by either the Secretary of the Executive Office of Environmental Affairs or the Director of the Massachusetts Historical Commission.

• The tax credit is based on 50% of the appraised fair market value of the gift. The amount of credit which can be claimed is limited to $50,000. In any one tax year, the credit claimed cannot exceed the tax due, but unused portions of the $50,000 credit can be carried forward for up to five consecutive years.

North Carolina currently has an income tax credit for donors of conservation land. With a cost to NC of only $3.6 million over the program’s 15-year duration, approximately $12 worth of land has been protected for every $1 cost. Initiated cautiously with a $5,000 maximum credit, the program was so successful and had such a negligible impact on the state’s coffers that after five years the maximum was raised to $25,000, resulting in a doubling of applications. After eight more years, the maximum was again raised to $100,000 for individuals and $250,000 for corporations and it is currently being considered for another increase.

The Governor’s Blue Ribbon Panel for Land Protection, in its October 1998 report The View From Borderland, called for the Commonwealth to identify and promote innovative land protection techniques and landowner incentives such as a state tax credit for individual land donations (see Goal 4.1). Although Massachusetts does not provide for income tax deductions for charitable donations, current Massachusetts law (MGL Chapter 62 Section 6) provides income tax credits for a wide range of environmental activities, including investments in renewable energy sources for residential property, residential lead removal, and Title V septic system upgrades. The time is ripe for Massachusetts to consider and implement proactive incentives for voluntary land conservation.

The following simplistic examples demonstrate the impact of gifts of conservation land worth $20,000 and worth more than $100,000. The benefit to the donor of land can be used to offset the out-of-pocket costs of the land transaction. The per-acre cost to the Commonwealth of protecting such land is significantly less than if the land was purchased for conservation.