By Todd Cohen
A foundation and a private donor are investing $10 million in a new initiative to find, test and push for incentives for private landowners to better manage critical ecosystems.
With $5 million from the Doris Duke Charitable Foundation in New York that matched a $5 million challenge grant from investor Robert W. Wilson, an Environmental Defense board member, the New York-based nonprofit has created a Center for Conservation Incentives.
While environmental philanthropy has focused on protecting public land for its scenic or aesthetic value, or on buying private land or easements, private dollars can never support the level of conservation needed to protect the vast private lands in the United States, said Robert Bonnie, senior economist at Environmental Defense.
“We have to create incentives whereby landowners are voluntarily willing to undertake activities to protect the environment on their land,” he says.
Doris Duke, which has made roughly $50 million in grants to buy or preserve about 750,000 acres since it began operating in 1997, selected Environmental Defense through a competitive process that grew out of smaller pilot projects it had funded.
“While we still like acquisitions, we recognize there is a range of strategies needed on all the land we’re never going to be able to buy,” says Peter Howell, the foundation’s program director for the environment.
“We need to think about how do we change behavior on the part of landowners who may never sell their land or never sell easements,” he says.
With an estimated two-thirds to three-fourths of land in the U.S. in private hands, including an estimated 10 million non-industrial landowners who own forest land, he says, the challenge is to figure out how to coax landowners to invest in protecting that land.
Based on research by San Francisco-based California Environmental Associates, which it hired to assess the most promising environmental incentives in the United States, the foundation decided to focus the new center on incentives that use government subsidies, rather than on market or regulatory incentives.
The center is targeting a portion of billions of dollars in federal farm subsidies and conservation funding that Howell says is likely to be available over the next 10 years.
Of that funding, says Bonnie, the center aims to tap $2 billion to $3 billion over the next five years to help protect rare species and ecosystems on private lands.
Working with Environmental Defense’s regional offices, the center will map critical lands and existing incentives programs, develop and test innovative incentives and work to translate those that are effective into state and federal public policy, Howell says.
A model for what the new center aims to accomplish was launched in 1995, when Environmental Defense teamed up with the U.S. Fish and Wildlife Service and private landowners to try to protect the red-cockaded woodpecker in the Sandhills region of North Carolina.
Under the program, known as “Safe Harbor,” 67 owners of golf courses, horse farms, woodlots and residential properties agreed to take steps to better manage their land to protect the endangered bird, and the government agreed to curb the additional regulation that the stepped-up land management otherwise would have triggered.
Sandhills landowners have placed nearly 37,500 acres in the program, which now includes owners who have placed more than 2 million acres in 20 projects throughout the U.S.
In addition to developing and running 15 pilot projects at any one time, including those for which it will “re-grant” roughly $2 million, the center will push for changes in state and federal public policy, such as using farm subsidies for conservation.
In North Carolina, for example, the Southeast regional office of Environmental Defense last year helped persuade state lawmakers to change a 30-year-old law it believed was discouraging owners of farms or forest land from managing their land for conservation purposes.
Originally enacted to promote agriculture, the law gave an annual property tax break to landowners who used their land for farming or timber production.
But if landowners took their land out of production, a likely move if they wanted to protect fragile ecosystems, they were taxed on their land’s fair market value and had to pay back taxes for the previous three years, says Dan Whittle, senior attorney for the regional office.
Yet while that law discouraged conservation, Whittle says, a separate state law gave a one-time credit on their income tax to landowners who put their land in a conservation easement.
Under the new law, landowners putting productive farms or timberlands into a conservation easement still get the property tax break, Whittle says, and its annual cost to the state of $80 million won’t change.
“You had two state public policies that were in direct conflict with one another,” Whittle says. “On one hand, the state was giving landowners money to conserve lands, and with the other hand, the state was picking the conservation-minded landowner’s pocket.”
An estimated 90 percent of North Carolina’s 32 million acres are in private hands, including 700,000 non-industrial landowners who own private forests, posing a big hurdle because wildlife and clean water do not “observe private-property boundaries,” Whittle says.
“The challenge for public policy is to influence the way private landowners manage their land to maximize the public benefits,” he says. “Incentives are an important public policy tool to influence private behavior.”
Howell says the new center aims to be a “nerve center and skunk works” to hatch and promote incentives that work.
“The biodiversity of this country depends on the decisions of millions and millions of private landowners, and if we can’t come up with robust and effective incentives for them to do the right thing on their land, they’re going to do the wrong things, and that’s going to have huge consequences,” he says. “There are very good public reasons to worry about that.”