Easements

What Is An Easement?
A preservation easement is a voluntary legal agreement between a property owner and a taxexempt, charitable organization or government entity, which helps protect historically and architecturally significant buildings and their settings. Under the terms of an historic preservation easement, the property owner grants a portion of, or interest in, their property rights to an organization whose mission includes historic preservation. The intent of the preservation easement is to prevent anyone from demolishing the building or diminishing its historic character.

Typically, the owner retains all the usual private property rights, but not the rights to demolish or alter the property in ways that detract from its historic character. Alterations, improvements, and even additions to the structure may be allowed, providing they do not compromise the historic character of the property. At Adirondack Architectural Heritage (AARCH), we are always willing to work with the owner of a property on which we hold an easement, not only to preserve the historic character of a building, but also to make it a comfortable and desirable place in which to live or work.

Why Are Easements Important?
Many people who are interested in older buildings are under the false impression that if a building is “historic,” it is somehow automatically protected from destruction. In reality, a listing on the National Register of Historic Places does not prevent an owner from demolishing a building. In some localities, local preservation ordinances do provide a measure of protection for historic properties but, in the Adirondack region, few such ordinances exist. An easement, on the other hand, is a legal document that ensures the preservation of a historic property in perpetuity.

How Can Easements Benefit Property Owners?
Granting a preservation easement can lead to substantial savings for the owner of a historic property. First, the assessed value of the property may be lowered or stabilized, resulting in property taxes that are lower or at least held to their current rate. The value of some properties might not decrease much if the easement does not conflict with what a prudent owner would normally do with the property. The savings, however, may be substantial in the case of urban properties that are zoned to allow buildings much larger than the existing historic structure and in the case of rural properties when the easements preclude extensive development for which there is a market demand.

Second, a property owner who grants an easement to a qualified tax-exempt organization such as AARCH, can qualify for an income tax deduction under the charitable contribution clause. Some restrictions apply. As with any tax issue, you should consult your accountant to find out how these easement benefits could affect your specific financial situation.

Finally, easements that lower the market value of a property can also reduce estate, gift, and capital gains taxes. In fact, the estate tax savings can be considerable, far outweighing property and income tax benefits. These savings will, of course, depend on the particular property in question and the financial situation of the easement donor.

What Does A Preservation Easement Cover?
Typical preservation easements and most of those held by AARCH are facade easements, which pertain only to the exterior envelope of the building. The interiors of buildings with historic features may also be covered, although building owners less frequently are interested in donating these rights. Easements may also prohibit alterations to the surrounding grounds that would detract from the exterior appearance of the building. These might include excavations, earth berms, rubbish heaps, ash dumps, and utility towers, for example.

Easements may also be applied to land. For example, the owner of a farm who does not wish his/her land to be developed can grant an easement restricting future development of the property. Land preservation or conservation easements have become an important tool for open space preservation and have been used by conservation groups to protect wildlife habitat, trees, and agricultural land. Preservation and conservation easements are often combined into a single agreement.

How Do Easements Impact Owners’ Use Of Their Property?
AARCH is happy to work with the owners of properties on which we hold easements to accommodate their needs and desires for expansion or modification of their structures. The key to success is simply to begin discussion of one’s plans at the conceptual stage so that approval can be agreed upon before any work is actually started. In this way, AARCH can fulfill its duty to ensure that the historic integrity of the site will not be compromised. Often, AARCH can advise regarding ways to rehabilitate or restore historic structures properly and economically.

As a preservation easement holder, it is AARCH’s responsibility to conduct regular inspections of its easement-encumbered properties to confirm that they are being maintained in accordance with the terms of the easements. The inspections also allow AARCH staff to monitor the condition of a property over time and make recommendations to property owners for maintenance work which will prevent small problems from becoming large problems. Most inspections reveal the dedication and care lavished by owners on their historic properties. In the rare cases where a violation of the easement has occurred, AARCH may be legally empowered to correct the violation at the owner’s expense.

How Long Does An Easement Last?
The length of time that an easement will run is specified in the easement document itself and can be any period agreed upon by the signers of the easement. However, in order to qualify for tax reductions, the easement must be in perpetuity. Most preservation easements, including the ones held by AARCH are “granted in perpetuity” and “deemed to run with the land,” meaning that they last forever, no matter how many times or to whom the property is sold. This ensures that the protection offered by the easement will not cease when the property is sold to a new owner.

How Do Easements Get Conveyed?
AARCH acquires easements as a charitable gift to the organization. The owner of a historic property who wants to make sure that it will not be destroyed or inappropriately altered can grant AARCH a preservation easement in perpetuity on the property. The terms of such an easement can be written in any manner that the owner wants as long as they are acceptable to AARCH.

Preservation Easements Held by AARCH
AARCH began holding preservation easements on properties within the Adirondack Park in 1995. Currently, AARCH holds easements on five properties including one in Keene, two in Willsboro, one in the Town of Brighton, and one on Tupper Lake. Types of easements that AARCH will hold in perpetuity include: historic buildings, facade, interior, and open space. For more information on how AARCH can help protect your property, contact us at: (518) 834-9328.

For additional information, including financial benefits, and IRS requirements for qualifications, download the National Park Service publication: Historic Preservation Easements: A Directory of Historic Preservation Easement Holding Organizations (pdf). or visit the National Park Service website.

For more information about the Federal Historic Preservation Tax Incentive, visit the Trust for Architectural Easements at: www.architecturaltrust.org , or view the Federal Program Overview (pdf).

To see an example of an standard easement, click here.