Following our three-part series with Mike Swan, we turn to the afternoon session from the same seminar: Kendall Van Dyke on conservation easements. Kendall spent nearly 14 years in private land conservation with the Montana Land Reliance, most recently as managing director, before joining Swan Land Company. He’s also worked with Trout Unlimited and the Northern Plains Resource Council, and he was raised on his family’s farming and ranching operation near Three Forks.
You just left the Montana Land Reliance after almost 14 years there. What did that work actually look like?
It was a meaningful career, working with some of the most interesting people you could ask for — fifth-generation family farms and ranches looking for options to keep the operation intact, or families weighing the charitable tax side of a conservation easement. One of the things I find genuinely interesting about private land conservation is that the field has built a space where there tends to be something workable for most producers, whatever their situation looks like.
But like anything permanent, it’s an eyes-wide-open decision. These are forever decisions. That needs to be taken seriously by counsel, by real estate brokers, and by the landowners themselves. I should say up front that I speak only from my own experience at the Montana Land Reliance. Every land trust is different — different culture, different priorities. MLR, in my view, is an unapologetic supporter of production agriculture, and when we engage in an easement with a landowner, we’re trying hard to look at the whole process through that lens. That said, land trusts aren’t legal or tax specialists. If you’re weighing an easement, you need people like an attorney, a 1031 exchange team, or a tax advisor at the table. We provide a service that helps accomplish conservation goals, we’re not the experts on the tax consequences.
Is the demand for conservation easements actually growing, or has it leveled off?
It’s not slowing down. Demand is there, and MLR has consistently seen more of it than we can accomplish, both from a funding standpoint and a capacity standpoint. In 2017, we hit what we called our million-acre year — a million acres conserved in 40 years. From there we set a simple goal: another million acres in the next 20. We’re sitting at around 1.4 million acres toward that two-million-acre target now, which puts MLR on track to hit it by 2040.
What’s interesting is how that pace used to track almost exactly with the S&P 500. Easements were, for a long time, a tool that worked best for high-income landowners with excess money in their portfolio in a good year. That correlation has weakened, though, because programs funded through the Farm Bill have opened the door to landowners who aren’t chasing a deduction so much as a cash infusion — often to buy out a cousin or another family shareholder and keep the operation intact. As those programs have become better known, demand has climbed higher than I’ve seen in my career.
If conservation easements can bring in real money, why do you call the tax angle a “dirty little secret”?
Because as generous as the tax code tries to be for a working farm or ranch, deductions aren’t usually top of mind for production agriculture people especially in a year when cattle prices are good. Historically, the tax code hasn’t been written in a way that’s all that beneficial to working farms and ranches, particularly now that estate tax exemptions have gotten more favorable for producers. So the appeal of an easement often isn’t the deduction at all. The NRCS’s Agricultural Land Easement program, for example, opens the door for producers who don’t need a tax write-off, they need cash, often to buy out their family and keep farming.
What should a broker or attorney know about the process itself — the timeline, the county’s role, that kind of thing?
The biggest thing is that this doesn’t move fast, and it shouldn’t. Montana statute gives counties a 90-day review period on any conservation easement. That’s not an up-or-down vote — the county can’t approve or deny it but they have to have the chance to look at it against their own planning documents and come back with questions, maybe around emergency services access or school routes on the outskirts of a growing community. If a county does nothing in that 90 days, the easement can be recorded. But if someone came to me today and said, “let’s jam this through,” I’d advise against it even if it were technically possible. That review period exists for a reason, and it’s an important piece of state law that people don’t always think about.
And that’s really the throughline for the whole conversation: easements aren’t going away, and by and large, once they’re in place, they last forever. If you’re brokering a piece of real estate with an easement on it, that easement is going to be there the next time it sells too. In our next piece, we’ll get into how easements have actually changed over the decades — and why the old ones can cause real headaches for anyone trying to sell or buy a property today.