“We are extremely grateful to Michigan’s own Senator Stabenow for again demonstrating national leadership on important conservation legislation and thank her for her commitment to making permanent these tax incentives,” stated Jonathan Jarosz, Executive Director of Heart of the Lakes, the state association of Michigan’s nonprofit land conservancies. Michigan’s land conservancies work with landowners who willingly enter into conservation easements, a legal tool that permanently protects important conservation values on natural and working lands such as farmland and forests.
“Our farmers are the best stewards of the land,” Stabenow stated. “If this deduction is made permanent, more landowners will take part in preserving our land, water and wildlife habitats. It’s a win for taxpayers, a win for farmers, and it’s a win for our environment.”
Under the Conservation Incentive Easement Act of 2015, landowners who donate their property development rights would maintain ownership and management of the land, but forgo their rights to develop the land in the future. S. 330 and H.R. 641 would make permanent an enhanced tax incentive for donating development rights that expired at the end of 2014. Previous efforts to make the incentive permanent have received broad bipartisan support in Michigan, notably led by efforts in the last Congressional session by former U.S. Representative Dave Camp from Midland.
But instead of being permanent, the enhanced tax incentive has been extended on a short-term basis. Consequently, this has created uncertainty among landowners and has discouraged donations because it takes an average of three years to set up a conservation easement. With a short-term extension, landowners who want to donate their development rights for conservation may not know if the enhanced tax benefits will be available to them by the time their conservation easement is established. Making the enhanced incentive permanent will give more farmers, ranchers, forest, and other landowners the assurances they need to choose land conservation over development.
In addition, the Conservation Easement Incentive Act would also help moderate-income landowners choose conservation by:
• Raising the maximum deduction a donor can take for donating a conservation easement from 30 percent of their adjusted gross income (AGI) in any year to 50 percent;
• Allowing qualified farmers and ranchers to deduct up to 100 percent of their AGI; and
• Increasing the number of years over which a donor can take this deduction from 5 to 15 years.
“We look forward to working with Senator Stabenow and her staff to make this incentive permanent,” added Jarosz. “It makes sense for Michigan landowners who may not otherwise be able to conserve the farms and natural lands they love.”
The Conservation Easement Incentive Act has been endorsed by Heart of the Lakes, Land Trust Alliance, Ducks Unlimited, the National Cattlemen's Beef Association, the Nature Conservancy, the National Sports Shooting Foundation, the National Trust for Historic Preservation, the Mule Deer Foundation, the American Farm Bureau Federation, the American Forest Foundation, the National Audubon Society, the Wildlife Society, the California Association of Wine Growers, and National Wild Turkey Federation.
H.R. 641 has been referred to the House Committee on Ways and Means for further consideration, on which Congressmen Thompson and Kelly both serve. S. 330 has been referred to Senate Finance Committee on which Stabenow and Heller serve.