I’ve recently counseled a client who owned a large ranch, but didn’t know what to do with the land when she died. She had no children or extended family but she deeply loved her land and wanted the land protected or preserved in its natural state with little development allowed.
She showed me her will which left her ranch to a major university with a restriction that the land be preserved and cared for forever. The university could use the land for educational and research purposes, but she told me she had not contacted the university to discuss this gift with them when she wrote her will. I explained that although her gift was a valid one, the university was not bound by her will to accept it. My recommendation was that she call the university planned giving department and inform them of this charitable donation.
She reported back to me that the university declined to accept her gift of restricted land. The university official said the institution would appreciate the gift of land in an unrestricted form. They would likely sell it for the highest price as soon as possible and dedicate the proceeds to their mission. However, the school perceived this restricted gift of land as a burden, and they could not in good conscience agree that the university would care for it forever. My client offered to give them some cash in addition to the land, but when the official looked at the cost of ownership they concluded the university would need a significantly larger monetary contribution.
The first lesson: when making a gift with a restriction in your estate plan, don’t assume it will automatically be accepted.
To solve this dilemma, I called the university planned giving office. I explained that I had a client who wanted to give the university a gift of land without any strings attached. My client wanted to see the land preserved and would put a conservation easement on the property while she was alive. The conservation easement would protect the ranch forever and prohibit any further development of the property. When my client died the ranch would be given to the university, who would be free to sell the land, subject to the existing conservation easement, the terms of which would bind all future landowners. The officer agreed that the university would accept such a gift, since it did not place the burden on them and permitted the university to sell the property.
Giving land away is not as easy as it sounds, especially if one of your goals is to see that the property is preserved. Don’t assume the recipient will automatically accept such a restricted gift. There are ways to bring your goals into alignment. A conservation easement is a useful tool in such a case to protect the land forever, and fulfill charitable goals.