Held at Colorado State University Nov. 19, the annual Green Bag Seminar Series hosted Professor of agriculture and resource economics Andrew Seidl, who presented crucial findings from studies he conducted that showcase the many benefits of conservation easements.
A conservation easement is a voluntary legal agreement between a landowner and another entity that places limitations on the usage of the property. In return, landowners receive tax credits.
Colorado is home to some of the most breathtaking views and wildlife in the United States, and with such large areas of privately owned land, incentivizing its protection is critical.
“Markets are not reflecting the true value of stewardship of private lands,” Seidl said. “Farmers and ranchers are being compensated for producing beef, lamb and corn, but not for the other ecosystem services they’re providing.”
Some main goals of conservation easements are preserving scenic views, protecting fish and wildlife habitats, sustaining agricultural production and maintaining spaces for outdoor education and recreation.
Seidl’s research found that Colorado taxpayers have received an estimated $35 billion to $57 billion in economic benefits since 1995 from investments of nearly $1.2 billion from state tax incentive programs.
“The power of putting dollar values on things that are otherwise noncomparable, it gives a way of comparing. … It makes people nervous, but it gives relative value.” -Andrew Seidl, CSU agricultural and resource economics professor
If recreation and tourism benefits are included, Colorado taxpayers saw $43 billion to $74 billion in cumulative public benefits. This means that for every $1 invested in tax credit programs, the public saw a $37 to $64 return value.
Although it’s hard to put a numerical value on things like crucial habitat and recreational resources, it’s a necessary cost to sell the message of preservation.
“The power of putting dollar values on things that are otherwise noncomparable gives a way of comparing,” Seidl said. “It makes people nervous, but it gives relative value.”
Since 2000, Colorado has seen 2.3 million acres of land conserved by easements that provide tax credits. This includes areas marked as crucial habitat, elk severe winter range, creek, stream or river frontage, prime farmland and many other important areas.
Two of the main tools Colorado has used in achieving these benefits are through the Colorado Conservation easement tax credit program and the Great Outdoors Colorado program.
The Colorado Conservation easement tax credit program was established in 2000 and provides tax credits for landowners, primarily in the agriculture sector, who place conservation easements on their property. Initially, the program paid up to $100,000 per easement. Now, it pays up to 90% of fair market value, with a maximum of $5 million per transaction.
These payments are based on the difference between the agricultural land value and the development value. This means landowners are compensated for the opportunity cost of not developing their land and instead protecting it.
The GOCO program was formed in 1992 and is another primary tool in private land conservation in Colorado. According to its website, the organization has assisted in the protection of more than 1.4 million acres in every county in Colorado.
In addition to public and ecological benefits, landowners who participate in conservation easements benefit greatly as well.
Seidl introduced a study he conducted that focused on how landowners used their tax credits while being a part of the federal Agriculture Conservation Easement Program. It looked at 68 separate Colorado easements and received 44 responses from their survey.
Seidl found from the responses that over half of tax credit expenditures were used to pay down debt. The rest were mostly put into savings or reinvested in agricultural production. He emphasized that these tax credits help increase rural economic resilience, improve credit ratings and reduce financial stress.
Some challenges this analysis posed, Seidl said, are that species in Colorado that are crucial to the environment are not necessarily the same things people value. In addition, you can’t really calculate an exact return on investment because we don’t have all the costs, nor do we have all the benefits.
Throughout his research, Seidl partnered with the Colorado Natural Heritage Program, a nonacademic department of the Warner College of Natural Resources, whose mission is to help promote the conservation of Colorado’s biological resources.
In 2021, the CNHP launched Colorado’s Conservation Data Explorer. The purpose of this web-based interactive map is to provide free access to anyone interested in understanding ecosystem service values.
Preservation is important to the CNHP, which hosted Seidl’s talk at the annual seminar series.
“The goal is to highlight the work that CNHP’s wonderful partners are doing and bring that forward,” said David Anderson, CNHP’s director and chief scientist.
Reach Katya Arzubi at science@collegian.com or on social media @RMCollegian.
