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Maryland Environmental Trust2 0 0 2 A N N U A L R E P O R T
Photo by Jim Highsaw
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Conservation is sometimes perceived as stopping everything cold...
the choice is not between people or wild places;
it is between a rich or an impoverished existence for man.
Thomas Lovejoy
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The past few years have been extraordinary onesfor land conservation in Maryland. Land trusts andconservation agencies have seen the annual totals of
acreage preserved increase to unprecedented levels.The rate of land preservation for the last few yearshas outstripped the rate at which land is developedand subdivided.
In large part, this is due to liberal state andcounty funding for the purchase of easements.Through the Department of Natural ResourcesRural Legacy, Open Space, and GreenPrint
programs, and the Maryland Agricultural LandPreservation Program (MALPF), run by theDepartment of Agriculture, many thousands ofacres of valuable land have been saved.
It is also worth noting that many public-minded landowners have sold easements for less thanthe full value determined by appraisal. In so doing,they have generously allowed funds to be made
available to a larger number of landowners. Thesebargain sales have also allowed the sellers ofeasements to take advantage of tax deductions that
shelter the income they receive for their easements.Finally, aided in part by the recently-enactedIncome Tax Credit for donation of easements to theMaryland Environmental Trust (MET) andMALPF, the number of acres of easements METpreserved this year is a record.The Tax Credit greatly increases the financialincentives for easement donation by middle-income
landowners. For husband and wife, up to $160,000may be returned to the landowner in the form ofincome tax credits when an easement is donated.
Although the current state budget shortfallmeans that funding for easement purchase will bemuch tighter for the foreseeable future, we lookforward to many more years of successful landpreservation.
John BernsteinDirector
Letter from the DirectorAmending and Improving MET Easements
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The mission of the Trust isfound in Natural Resources Article3-201, subtitle 2 of the Annotated
Code of Maryland:There is a Maryland
Environmental Trust established to
conserve, improve, stimulate, and
perpetuate the aesthetic, natural, health
and welfare, scenic, and cultural
qualities of the environment, including
but not limited to land, water, air,wildlife, scenic qualities, open spaces,
buildings or any interest therein, and
other appurtenances pertaining in any
way to the State. Through educational
and other means, the Trust shall
encourage and motivate the populace of
the State and others to do so and shall
promote the continuing interest in and
the study of these matters. The purpose
of the Trust is of general benefit to the
citizens of the State, and it is charitable
in nature.
MissionConservation Easement Program
The primary focus of the Trust is the protection
of land from development through donatedconservation easements. A conservation easementis a perpetual legal agreement between a landownerand the Trust, ensuring that a property shall not bedeveloped (or subdivided) beyond a limit agreedupon by both parties. The land is thereby protectedand preserved; the landowner retains all rights ofownership and privacy. An easement is binding on
all future landowners and may lead to significantincome, estate, and property tax benefits.
Description of ProgramsLocal Land Trust Assistance
The Trust assists citizen groups in the formation
and operation of local land trusts by offering training,technical assistance, administrative and projectgrants, and membership in the Maryland Land TrustAlliance. Conservation easements may be jointly heldwith the Trust and a local land trust.
Keep Maryland Beautiful
Through such incentives as the Bill JamesEnvironmental Grant and the Margaret Rosch Jones Award, the Keep Maryland Beautiful(KMB) program focuses on environmentaleducation projects.
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Moses easement on Little Falls, Baltimore County
photo:JimHighsaw
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Pennterra, Frederick County
photo:BarbaraLevin
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Through donations, the Trusts ConservationEasement Program protected over 60% of the 1,033total acres preserved on the Eastern Shore. Sevenlandowners donated conservation easements on 655acres in four eastern shore counties. Talbot Countyled the way with 470 acres protected including apost-mortem donation to Eastern Shore LandConservancy and MET by an estate on 260 acresalong Bollingbrook Creek and the ESLCs Con-servation Reserve Enhancement Program/METcombined easement overlay on 81 acres, which were
then conveyed to the Town of St. Michaels for pub-lic use. In addition, MET protected 20 acres alongLaTrappe Creek and then with the ESLC, 109acres along Harris Creek. In Dorchester County,the Trust accepted its first easement along BriaryCove on 24 acres, then coordinated with theESLC to protect 94 acres southeast of Preston. InWicomico County and in cooperation with the
Lower Shore Land Trust, MET Board member K.King Burnett and his wife Esther Burnett preserveda 68-acre woodlot. With this second easement do-nation, the Burnetts have protected 93 acres, in-cluding their 25-acre home farm. Through theRural Legacy Programs purchased conservationeasement program, and also in cooperation withthe ESLC, 292 acres of prime farmland and wood-
land buffers were protected in the MarshyhopeRiver Rural Legacy Focus Area.
EASTERN REGION
Smith Cove off little Choptank River, Dorchester County
photo:JohnHutson
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853
822
12,228
31
2101
3321
8224831
4943
8703
6632
474
2830
1147
7856
2115
281
7001
3309
3242
9680
3927
1461
5046
MET EasementsAcross Maryland
Cumulative Number of Acres Per County
Cumulative Easement Acreage
Cumulative Number of Easements
10000
80000
70000
60000
50000
40000
30000
20000
100
600
500
400
300
200
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
1972
1973
1974
1975
1976
1977
1978
1979
1980
1981
1982
1983
1984
1985
1986
1987
1988
1989
1990
1991
1992
1993
1994
1995
1996
1997
1998
1999
2000
2001
2002
ACRES
EASEMENTS
90000
700
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South Grays Bog, Anne Arundel County
photo:JohnHutson
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After the success of the Maryland Income Tax Credit fordonation of conservation easements successfully passed throughthe Legislature last year, this year has been a quiet one for MET-related legislation. The Tax Credit allows a husband and wife totake a credit of up to $10,000 per year against Maryland incometaxes owed. It can be carried forward for 15 years, allowing atotal tax credit of $160,000. In a typical example this tax creditincreased the net savings due to an easement donation from ap-proximately $57,000 to $110,000.
In the coming year, MET has several legislative priorities. How-ever, with current deficits, it is unlikely that the Legislature willentertain any proposal that creates a new drain on state resources.In that context, MET plans to explore the following:1) Expansion of the Maryland Income Tax Credit. Create an
alternative track for tax credits, increasing the maximum credit(to, say, $12,500 per year per taxpayer) but decreasing thelength of the carryforward so that the total tax loss to theState is not increased.
2) Transferability. Several states have enacted tax credits which
are transferable. This allows a landowner who cannot takeadvantage of the tax credit to transfer it to another taxpayerin return for a cash payment.
3) Property Taxes. Most MET easement donors are eligible foragricultural use assessment, which keeps their property taxesvery low. In addition, donors receive a 100% rebate of prop-erty taxes on the unimproved portion of their properties for15 years after donation. MET intends to propose legislation
that mandates that all MET donors receive the lowest agri-cultural assessment possible.
FY 2002 Legislation
Years 1-6 Years 7-16
Adjusted Gross Income Before Easement $90,000 $90,000
Annual Deduction for Easement Donation ($27,000) ($0.00)
Adjusted Gross Income After Easement $63,000 $90,000
Estimated Tax without Easement $24,227 $24,227
Method 1 -
Estimated Tax With Easement $14,679 N/AUsing Federal & State Deductions
Method 2 -Estimated Tax Using $12,536 $20,096Federal Deduction & State Credit
Method 1 - Annual Tax Savings $9,548 N/A
Method 2 - Annual Tax Savings (Tax Credit) $11,691 $4,131
TOTAL ESTIMATED TAX SAVINGSMethod 1 - $57,288 (35% of donation) ORMethod 2 - $111,456 (74% of donation)In a typical example this tax credit increasedthe net savings due to and easement donation
from approximately $57,000 to $110,000.
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General Fund50%
SpecialFund 40%
Reimbursable 10%Fund
Number of Authorized Positions 10.70
Salaries, Wages and Fringe Benefits $529,715
Total Operating Expenses 412,202(includes grants, contractual services,communications, travel, equipment,supplies and materials)
Total Expenditure 957,942
FUND SOURCESNet General Fund Expenditure 473,327
Special Fund Expenditure 387,293
Reimbursable Fund Expenditure 97,322
TOTAL 957,942
Appropriations StatementFISCAL YEAR 2002
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Staff
Dorothy Smith, Secretary Lisa Holmes, Secretary
Shirley Massenburg,Administrator
Diane Chasse,Natural Resources Planner
Nick Williams, Local Land Trust CoordinatorJim Highsaw, Easememt Program Manager
Jonathan Chapman, Monitoring CoordinatorBarbara Levin, Natural Resources Planner
John Hutson,Natural Resources Planner
John Bernstein, Directorphotos:S
hirleyMassenburg
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MARYLAND ENVIRONMENTAL TRUST
100 COMMUNITYPLACE 1ST FLOOR
CROWNSVILLE, MARYLAND21032-2023
www.conservemd.org
410-514-7900 877-514-7900