Report: Colorado conservation easements a good investment
February 1, 2010
DENVER – Coloradans reap roughly $6 in benefits for every $1 invested in efforts to keep agricultural land and other open spaces from being developed, a report released Monday suggests.
The analysis by the Trust for Public Land is the first to put a dollar value on the benefits of the state’s conservation easements, said Tim Wohlgenant, the group’s Colorado director. The report comes amid Colorado’s looming $1 billion budget shortfall, and the possibility of cuts to a state program that offers tax credits to set aside lands.
A total of $511 million was spent on conservation easements in Colorado from 1995 through 2008. The money came from Great Outdoors Colorado, which uses state lottery revenue, and state tax credits.
The process of quantifying the value of the 1.4 million acres under conservation easements in Colorado was based on the economic benefits of open space, wildlife habitat, clean water, scenic views and other qualities.
Jessica Sargent-Michaud, an economist with the national Trust for Public Land, said she used geographic data to group Colorado’s conservation easements into 16 distinct ecosystems. She then assigned the land a per-acre dollar value based on figures used in about 10 published studies and consultations with state agriculture extension agents.
Examples include the premiums people pay to live next to open space, costs of cleaning up polluted water or money spent on recreation and tourism.
John Swartout, executive director of the Colorado Coalition of Land Trusts, said leaders in the Glenwood Springs area have determined that protecting open space along the Colorado River for trails leading into the city has been an economic boon for tourism.
“Wildlife watching is a huge industry now,” he added.
The land trust’s report is a welcome first attempt to estimate the worth of conserving Colorado’s natural heritage, something that doesn’t fit neatly in the marketplace, said Andrew Seidl, associate professor at Colorado State University’s Department of Agricultural and Resource Economics.
“This study makes explicit what all Coloradans know implicitly – what is good for Colorado’s native landscapes is good for Colorado,” Seidl said.
Wohlgenant said the national trust has prepared other economic studies, including on New Jersey’s conservation easements.
In Colorado, state tax credits for conservation easements jumped from $2.3 million in 2001 to $98 million in 2008, prompted in part by a change in 2003 that allowed the credits to be transferred and sold.
In 2008, reforms targeted fraud fueled by appraisers who overvalued the land. Federal and state authorities are challenging tens of millions of tax credits granted for conservation easements.
“There were a couple bad actors who came into the system and did a large amount of deals,” Swartout said.
Land trust organizations brought the problems to the state’s attention and changes were made, including reviews of property appraisals, Swartout said.
Now, Gov. Bill Ritter has proposed cutting back the current $52 million tax credit program to save money. A proposal would reduce the tax credits by $13 million in January 2011 and another $13 million in the second half of the fiscal year.
However, Wohlgenant said it is important to keep the program going.
Colorado can’t offer the kind of financial incentives other states can to attract businesses, Swartout said.
“I think the beauty of this state and preserving what we call quality-of-life investments is an economic driver,” he added.