Conservation Glossary

319 Grant Program:  Named for Section 319 of the Clean Water Act, this program funds projects that address nonpoint source pollution and improve water quality. This Federal program is administered locally by the OEPA through the Division of Surface Water. Funding focuses on projects that integrate local and state watershed-based water quality targets.  Funds are awarded on a competitive basis.

 

Agricultural Easement Purchase Program (AEPP): A statewide Ohio Department of Agriculture (ODA) program to preserve Ohio’s farmland through the purchase of agricultural easements. AEPP provides up to 75% matching grants to farmland owners who sell their development rights.

 

Appraisal: An estimate of the fair market value of property prepared by a qualified, independent professional appraiser.

 

Arrears: An unpaid, overdue debt or an unfulfilled obligation.  The state of being behind in fulfilling obligations: an account in arrears.

 

Assessment: The valuation of property in order to apportion, or assess, tax upon it, often in relation to other similar property also taxed. All real property in Ohio is assessed for real property tax purposes at 35% of its fair market value.

 

Bargain Sale:A Bargain sale occurs when a seller voluntarily sells a property to a non-profit such as Western Reserve Land Conservancy for less than full fair market value. For example, Landowner A owns a $1,000,000 property, which he/she decides to sell to Western Reserve Land Conservancy for $600,000. The transaction will have two components. First, there is a sale portion in the amount of a $600,000 payment that we make to Landowner A. Second, there is a charitable gift component of $400,000, which is a gift from Landowner A to Western Reserve Land Conservancy, that qualifies as a charitable gift under the internal revenue code.

 

Baseline Document: A record of the condition of the property at the time of acquisition of the conservation easement. Baseline documentation identifies existing physical conditions, natural and human-made, at the time of acquisition. Baseline documentation is required by the IRS for tax-deductible donations of conservation easements where the grantor reserves future rights, and is needed to document any changes over time.

 

Basis: Cost of property, or value when inherited; used to determine capital gains tax.

 

Bequest: A willed gift of personal property (automobiles, furniture), as opposed to real property, such as land, which is a devise.

 

Capital Gain: Profit from the sale of appreciated assets, such as property, in excess of its basis. 

 

Charitable Contribution: An outright gift or contribution, with charitable intent, whose value is deductible for federal and/or state income tax purposes and which may rive rise to estate/inheritance tax benefits.

 

Charitable Pledge: An expression of a promise to make a gift to a charity. The gift is not deductible until actually made. 

 

Charitable Remainder Trust (CRT): A CRT is an irrevocable trust designed to convert highly appreciated assets into a lifetime income stream without generating estate and capital gains taxes. When the trust ends, the remaining assets pass to the qualified charity or charities specified in the trust.

 

Clean Ohio Fund: Statewidevoter approvedprogram to restore, protect, and connect important natural and urban places.  Clean Ohio consists of four statewide program areas: the Revitalization Fund, the Agriculture Easement Purchase Program (AEPP), the Green Space Conservation Program, and the Trails Fund.  Clean Ohio Grants are awarded competitively by district. Funds are administered by the 19 OPWC districts and are primarily allocated to districts on a per-capita basis.   When referring to a Clean OH grant in LP documents, we are typically referring to the Clean OH Green Space Conservation Program, which is administered by OPWC.  Funding is allocated by District, which is composed of one or more counties, and funding award decisions are made by local NRACs in each district.

 

Closing Date: Date when transaction is completed: a date on which a transaction is concluded, especially when a seller delivers a deed and a buyer pays for it.

 

Coastal and Estuarine Land Protection (CELP): Federal grant program to protect sensitive coastal areas that have significant conservation, recreation, ecological, historical, or aesthetic values from development or conversion. The program is administered by the National Oceanic and Atmospheric Administration (NOAA).

 

Coastal Management Assistance Grants:Grant programfunded by theNational Oceanic & Atmospheric Administration and administered by ODNR Office of Coastal Management to protect, preserve, andrestore coastal resources.A minimum of 50 percent of project cost must be provided locally by applicant and federal funding cannot be used as match.

 

Conservation Easement: A legal document that permanently preserves land that the easement encumbers for conservation purposes as described in the document. Typically, conservation easements are granted by landowners to a non-profit such as Western Reserve Land Conservancy. Most are charitable donations. Some are purchased, and some are reserved by the non-profit when a transfer of property owned by the non-profit is made. (Legally, there are conservation easements that have specific terms after which they expire. However, these are not tax-deductible conservation easements, and it is unlikely that Western Reserve Land Conservancy would ever consider using one.)

 

Conveyance: A written instrument used to transfer (convey) title to property, such as a deed.

 

Covenant (or restriction): A written promise contained in a contract, lease, deed, conservation easement, or other form of agreement.

 

Current Agricultural Use Value (CAUV): State differential real estate tax assessment program that assesses active agricultural land according to its agricultural value, rather than its full market value. The majority of agricultural land is enrolled in CAUV.

 

Deed: The legal document by which title to, or an interest in, real estate is conveyed from one (the “grantor”) to another (the “grantee”).

 

Deed Restrictions: Terms that are placed in the deed to the property that restrict certain uses of the real estate by subsequent owners.

 

DEFA: Ohio EPA’sDivision of Environmental and Financial Assistance Finances water quality projects through low-interest revolving loan programs such as WPCLF. Administers the Water Resource Restoration Sponsor Program (WRRSP).

Devise: (v) To give or transmit real estate by will. (n) A gift of real estate by will.

 

Due Diligence: An investigation or audit of a potential investment. Due diligence serves to confirm all material facts in regards to a transaction. Offers to purchase an asset are usually dependent on the results of due diligence analysis.

 

Executor: One appointed by a will to carry out the deceased’s wishes.

 

Farm and Ranch Lands Protection Program (FRPP): A program of the Natural Resource Conservation Service (NRCS) that protects working agricultural land by limiting its non-agricultural use through conservation easements on private land. Funding is awarded by NRCS Ohio for eligible projects for up to 50% of the appraised market value of the conservation easement.

 

Federal Estate Tax:  A tax on the transfer of property at death of the owner.

 

Federal Gift Tax: A tax on the transfer of property during life (for less than full value in return).

 

Fee Simple Interest:Absolute ownership of property. Fee simple interest is the greatest interest that one can have in real property, being unqualified, of indefinite duration, freely transferable and inheritable.

 

Forest Legacy:  U.S. Forest Service Funded program administered by ODNR’s Division of Forestry to protect working forests from conversion. Projects are eligible in the Grand River Lowlands Forest Legacy Area, which includes Lake, Ashtabula, Geauga, Summit, Portage, and Trumbull counties. Conservation easements are used as the primary means of forest protection.

 

Full Fair Market Value (FMV): The amount of money paid for a property offered on the open market for a reasonable period of time with both buyer and seller knowing all the uses to which the property could be put and with neither party being under pressure to buy or sell.

 

Highest and Best Use: The basis for an appraiser’s estimate of full fair market value of a property, because it represents the reasonably probable and legal use of the land that would result in the highest value possible. This use must be physically possible, legal, and financially feasible. If all three of these elements are not considered, the estimate of final value cannot be supported.

 

Joint Tenancy: A form ofownership of property by two or more persons.

 

Land and Water Conservation Fund (LWCF): Federal grant program administered by ODNR for land acquisition related to public outdoor recreation projects. Applicant must be a political subdivision with a 50% match and the ability to finance and maintain the project. 

 

Land Trust Alliance (LTA): The national organization of land trusts that serves as a federal lobbying organization on behalf of land trusts, arranges for local, regional, and national training, and serves as a general umbrella organization for land trusts such as Western Reserve Land Conservancy. The Land Conservancy is a sponsor member of the Land Trust Alliance.

Legacy: A willed gift of money or other personal property.

 

Management Agreement: A generally informal agreement entered into by the landowner and the land trust concerning how the property’s natural resources are to be managed.

 

Mutual Covenants: Several landowners mutually agree to restrict their land. May not involve a land trust. Not necessarily permanent or binding on future owners. No income or estate tax benefits.

 

Mortgage Subordination: When a mortgage holder subordinates a mortgage that precedes conservation easement in time the mortgage holder agrees to allow the easement to be considered as preceding the mortgage in the chain of title, so that in the event of a foreclosure of the mortgage, the ease­ment is unaffected.

 

Nature Works: State grant program administered by the Ohio Department of Natural Resources to support recreation areas. Provides up to 75% reimbursement for the acquisition, development, and rehabilitation of recreation areas.  Funded by the 1993 voter-approved Parks and Natural Resources Bond Issue.

 

North American Wetlands Conservation Act (NAWCA): This program, administered by the USFWS, supports wetland conservation projects that benefit migratory birds and other wildlife associated with wetlands. Both the Standard and Small Grants programs of NAWCA require 1:1 partner match, not including other Federal Funding awards.

 

Ohio Forest Tax Law (OFTL): Forests enrolled in this program receive a 50 percent real estate tax reduction. A forest management plan is required as are regular commercial tree harvests.

 

Ohio Public Works Commission (OPWC): State Agency that administers the Clean Ohio Conservation Fund.  Funds are administered by the 19 OPWC districts and are primarily allocated to districts on a per-capita basis.  

 

Option: An enforceable agreement by which one party has the legal right to buy certain property at a certain time at a specified price or on certain conditions, to the exclusion of other buyers.

 

Phase I Environmental Assessment: An inspection of real property based on interviews with those familiar with the history of the property, a search of public records and a physical walk over.  A Phase I Environmental Assessment is conducted in order to determine if a Phase II Environmental Assessment is appropriate.

 

Phase II Environmental Assessment:If the Phase I assessment yield evidence of one or more “recognized environmental conditions,” a Phase II assessment will be conducted. A Phase II assessment consists of sampling and analysis. It provides a much higher degree of certainty regarding the type and extent of contamination. It also provides a basis for estimating the cleanup costs.

 

Purchase and Sale Agreement: A contract between a buyer and seller for the purchase of real estate, including all of the terms and conditions of the transaction.

 

Recreational Trails Program: An ODNR, Division of Real Estate and Land Management Program that provides up to 80% of project costs for urban trail facilities and linkages.

 

Remainder Interest: An interest in real property that does not become possessory until the completion of a prior interest; for example, where a grantor deeds property subject to a “reserved life estate,” the grantee has an immediate real property interest but its type of use and possession of the land is dependent upon the death of the life tenant.

 

Reserved Life Estate: The possessory right retained by a landowner who conveys the remainder interest to another.

 

Restrictive Covenants: Used in many subdivisions, these regulate the use of property for the benefit of neighbors. They usually are enforceable only by the landowners involved and their heirs and successors-in-title.

 

Right of First Refusal: An agreement that obligates a landowner if he receives an offer to buy his land, to allow the party that holds the rights of first refusal to match the offered price and terms before the landowner is free to sell to the party making the offer.

Seller Financing: An agreement whereby the buyer of real property pays for a portion of the purchase price at closing and agrees to pay the landowner over time, often with interest.

 

Tenancy in Common: Ownership of property by two or more persons, but in which each holds an undivided interest in the whole that does not pass at death by survivorship of the other owner(s), but rather passes by devise to the heir(s) of the deceased tenant.

 

Testamentary Gift: Gift by will.

Title: The evidence of ownership of real property. Title refers to holding the bundle of rights conveyed.

 

Title Insurance: A policy of insurance issued by an insurer that protects the holder from any loss sustained because of defects in the state of title other than those stated and specifically excluded from the policy. Usually, in exchange for a one-time premium paid at the time of the transaction, the title insurance company will protect the buyer of the property against any losses incurred as a result of title defects for as long as he or she owns the property

 

Title Commitment: A title commitment is a document indicating the current state of title for a property, including the owner of record, easements, covenants, or liens affecting the property, as well as any defects or clouds on title.It represents a statement of the condition of title as of the date of its issuance.

 

The Nature Conservancy (TNC): The Nature Conservancy is an international non-profit conservation organization.

 

Trust for Public Land (TPL): Trust for Public Land is a national non-profit organization that protects parks and open space.

 

Trusts: Not to be confused with Land Trusts, a trust is an arrangement by which one person (the “trustee”) holds property for the benefit of another (the “beneficiary”). The person who creates the trust is called the “grantor,” the “settlor” or the “donor.”

 

Water Pollution Control Loan Fund (WPCLF): Funding program administered by the Ohio EPA Division of Environmental and Financial Assistance (DEFA) in conjunction with the Water Resource Restoration Sponsor Program (WRRSP). Communities receiving Water Pollution Control Loan Funds (WPCLF) can reduce the total amount of money that is required to be paid back by 0.1 percent if they sponsor a qualified project that protects water resources. Part of the amount of money the community would otherwise pay as interest to WPCLF is used instead to pay for the WRRSP project. Ohio EPA approval is required for eligible projects.

Water Resource Restoration Sponsor Program (WRRSP): Funding program administered by the Ohio EPA Division of Environmental and Financial Assistance (DEFA) in conjunction with the Water Pollution Control Loan Fund (WPCLF). Communities receiving Water Pollution Control Loan Funds (WPCLF) can reduce the total amount of money that is required to be paid back by 0.1 percent if they sponsor a qualified project that protects water resources. Part of the amount of money the community would otherwise pay as interest to WPCLF is used instead to pay for the WRRSP project. Ohio EPA approval is required for eligible projects.