Over the last 19 years, ranchers throughout the Golden State have sought to partner with California Rangeland Trust to place conservation easements on their working ranches. State and federal agencies, recognizing the value of well-managed working landscapes, provide funding for these conservation easements, paying the landowner for the value of certain property rights like the right to develop and subdivide. The easement, recorded in the county assessor’s office, is in perpetuity – the land will always be used for livestock grazing.
California Rangeland Trust – a land trust governed by and for ranchers – plays an essential role, partnering with the landowner to create and decide what goes into the easement. Once the conservation easement is in place, the Rangeland Trust holds the easement and monitors it yearly, coordinating with the rancher to ensure the easement terms are carried out.
With 300,000 acres already conserved, California Rangeland Trust is the largest statewide land trust in the state. Another 400,000 acres await funding, but traditional funding sources are dwindling. To meet the demand, the Rangeland Trust is developing a culture of philanthropy and striving toward making the benefits of working landscapes common knowledge.
In addition, another funding source has emerged that has the potential to be far more lucrative for some lucky ranchers than a traditional conservation easement. Conservation easement values are typically determined by the appraised value of the rights that will be separated such as the right to develop, subdivide, or convert to intensive agriculture. Proximity to urban areas, soil type, and the real estate market all affect the appraised value. If the appraisal value is low, the project may not be as attractive to the rancher.
Enter mitigation easements. It’s no secret that housing, industry, and infrastructure development impacts wildlife habitat and open space values. To counter this, developers are often required to permanently protect similar habitat to the type they will be impacting through a mitigation conservation easement. While mitigation conservation easements can be slightly more restrictive than a typical conservation easement, they are similar in that the landowner agrees to never develop, subdivide, or intensify agricultural operations on the property. Often the easement will require that the land be grazed under some sort of management plan.
Mitigation policy often makes compliance with it a sellers’ market. If a rancher has the only vernal pools within the required proximity of the development project, he or she may be all that stands in the way of the project being completed. Because these are private deals between the developer and the landowner, mitigation easements can sell for much more than the appraised value. In addition, depending on the species or habitat being mitigated, these easements can close faster than traditional conservation easements.
Obvious benefits to mitigation easements are the ability to pay down debt or buy out family members who want to sell the ranch. But mitigation easements also offer ranchers a way to diversify without needing to alter their land management practices much, if at all.
The most recent Rangeland Trust mitigation easement is on Van Vleck Ranch in Rancho Murieta, the result of an agreement between Teichert Construction and the Van Vleck family. Thinking 50 years to the future, Stan Van Vleck noted that while land values continually increase, the income stream from agriculture does not and that the “asset value is too high for the return.” The family pragmatically recognizes what John Maddux of Maddux Cattle Co., Wauneta, NE, summed up brilliantly: “The hard truth is that if the returns to ranching were equal to or better than equities, bonds or other investments, there would be little incentive for family members to call for a ranch sale.”
Van Vleck Ranch, now 161 years old, almost didn’t make it to the 8th generation. As the only family member who wanted to be in agriculture and with a vision that the ranch still be in agriculture 100 years from now, Stan Van Vleck bought everyone out and began implementing a forward-thinking plan. Instead of trying to convince future generations to stay – even needing to work several jobs to pay for the business – his goal is to make the business much more profitable so it becomes a “good business decision” to keep the business and not just for the love of agriculture.
To put this goal in perspective, the ranch sits directly across the highway from 3,000 homes; the current average price sitting at just under half a million dollars. $498,680 to be exact. Mitigation easements are helping to make this formidable goal a reality. The cash inflow is allowing the family to expand their operations beyond agriculture and beyond California by investing in commercial real estate and other business ventures out of California. And yes, this expansion does involve the entire family. Stan, and his wife Nicole Montna Van Vleck, have brought their children, Christian and Tori, into the easement and investment decision process – the entire family participates in the family business.
In an interview, Stan said that up until now, rancher’s choices were limited. They could either sell for development or stay in ranching. Mitigation conservation easements offered their family a third alternative.
Other ranches throughout the state have mitigation easements with the Rangeland Trust. Agua Fria Ranch, Merced County, preserves wildlife habitat and safeguards scenic views along State Route 152 and Interstate 5. Vernal pools on the Dutchman Creek Ranch, also in Merced County, are under a mitigation conservation easement and managed by Westervelt Ecological Services, a mitigation bank. The nearby Roen Le Grand Ranch is also home to vernal pools. The East Sheridan Vernal Pool Preserve permanently protects 386 acres in Placer County, one of the fastest growing counties in California. Several easements on the Koopmann Ranch in Alameda County protect wildflower populations and provide habitat for the California tiger salamander, a state-listed species, and the California red legged frog, a federally threatened species. Tejon Ranch Company donated an easement to protect San Joaquin kit fox and blunt-nosed leopard lizard habitat as mitigation for a commercial development project on the ranch. Jack Ranch, owned by the Hearst Corporation, is the Rangeland Trust’s largest mitigation easement project, permanently conserving 7,270 acres in Monterey and San Luis Obispo Counties that offset the environmental impact of solar fields being built on the same ranch.
These easement projects are unique in that well-managed grazing plays a critical role in the maintenance of wildlife-friendly habitat. Not bad for continuing to manage the ranch in essentially the same manner as it has been for many years. The Rangeland Trust has just under 11,000 acres in mitigation easements, making up a small fraction of the total portfolio. But looking to the future, the opportunity is great for ranchers interested in participating.