Open Space Advisory Board Agenda and Packet 2015 04 08

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Open Space Advisory Board Minutes March 11th 2015 Page 4 of 8 interest if they did so. Boulder County points the landowners seeking conservation easements to the state tax credit bureau. Helen asked for a basic primer on tax credits for conservation easement. Sarah said that conservation easements are direct tax credits (as opposed to deductions) on state tax forms, capped at $750,000. Conservation easements can be transferred to someone else, meaning that the tax credit itself can be sold to other people with large tax bills, making it a useful source of revenue for people who are land -rich, but may be income -poor. Once you have settled on a property, how do you settle on a price? Joy answered that Jefferson County does a staff analysis, or a formal appraisal if they are looking for a grant or working with Great Outdoors Colorado. Appraisals are done by professional appraisers under contracts, and the lowest bidder is given the job. Internal staff analyses are cheaper and easier. Staff looks at MLS listings, Zillow, and other sorts of resources to look for comparable sales to determine a price. Janis said Boulder County's process is very similar. Joy mentioned that formal appraisals are often done during joint purchase processes, where more than one entity is sharing the burden of a land purchase. Sarah said that in Colorado Open Lands' process, landowners themselves must arrange the appraisals. They do not do them in- house, and appraisals are required by law for a conservation easement. However, if Colorado Open Lands are uncomfortable with the results of an appraisal, they will reject it. Colorado Open Lands doesn't formally select an appraiser for a landowner, but they do have a list of appraisers they won't work with. Jeff asked whether they are locked into the appraised value after a formal appraisal, or if they can have some wiggle room to pay more, if a landowner is holding out for more. Janis said they have a very small amount of wiggle room. Joy said that they used to be bound by the hard limit of the appraisal, but the staff analysis process now adds a little bit of flexibility on the price. Joy said that this means that they may be paying more than the appraisal value (or below), but this bit of flexibility really helps them. Linda asked why it's typical to get only one appraisal, rather than several. Sarah answered that appraisals are very expensive, conservation easement appraisals in particular (minimum $7000). Janis pointed out that appraisals are huge documents. Christopher remarked that there also aren't that many appraisal firms. Jeff asked the panel whether they ever work with 1033 exchanges. Janis said no, they don't use condemnation as a tool. Joy said that since the land acquisition is funded by the taxpayers, Jefferson County tries to keep their hands clean of them. Janis said they can delay closing until a landowner finds another property. What other strategies do you use for land acquisition? Janis said that Boulder County uses a lot of land dedications, and explained the TDR (Transferable Rights Program) concept: if you have a buffer that you want to protect around your city, a landowner in the area with development rights can agree with the county to leave it open, and get their rights moved into an urban area. She also explained the TDC (Transferable Credits Program) concept: if a landowner wants to build a large residential property (greater than 6000 square feet) then they have to buy 5