Revising Land Trust Standards and Practices: What Needs to be Changed and Why

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1 Revising Land Trust Standards and Practices: What Needs to be Changed and Why Land Trust Standards and Practices was first developed and later revised by and for the land trust community in partnership with the Land Trust Alliance. The Standards serve as the essential roadmap for every land trust to help preserve public trust, run an effective organization and conserve more land. The Alliance is leading a process with the land trust community to revise the Standards. Land trusts have been using the current edition of the Standards for over 10 years. The knowledge and experience gained by land trusts during that time was used to create a Discussion Draft for the revised Standards. The Discussion Draft presents a new streamlined look and format for the Standards and suggests potential revisions to specific language. The Discussion Draft is not intended as a specific proposal, but rather a way for the land trust community to focus its input into the substance of the proposed revisions to the Standards. The information presented in the tables below provides background to the Discussion Draft and explains the rationale for each substantive change proposed. Structural Change Shown in the Discussion Draft Change Explanation Reformatted practices Separating the practices into individual elements increases from paragraphs to clarity and will allow for a greater ability to link to the specific numbered elements supporting educational materials and sample documents for Distilled to essential elements Added elements Added specificity each item. Land trusts have shared that the Standards can feel overwhelming, and the redundancies in some areas can be confusing. Distilling the Standards to the essential elements will make the Standards clearer and more accessible. Since the 2004 publication of the Standards, the legal and operational environment for land trusts has evolved. Elements have been added to address these developments. Adding specificity will give land trusts better clarity on how to implement the Standards and will allow for greater transparency of how the Land Trust Accreditation Commission requirements and the Standards align. 1

2 Standard 1: Ethics, Mission and Community Engagement Land trusts maintain high ethical standards and have a mission committed solely to conservation, community service and public benefit. Element in the Current Standards 1D. The land trust upholds high standards of ethics in implementing its mission and in its governance and operations N/A N/A 1A. The board adopts a mission statement that specifies the public interest(s) served by the organization 1A. The board periodically reviews the mission statement Concerns Identified by the Land Trust Community 1D. Ethics 1A. Ethics A written code of ethics is part of Independent Sector s Principles for Good Governance and Ethical Practice. A written whistleblower policy is part of Independent Sector s Principles for Good Governance and Ethical Practice. Land trusts have an ethical obligation to not participate in transactions that are fraudulent or abusive as part of safeguarding the public trust in the land trust community. 1A. Mission 1B. Mission [Minor change to add specificity] [Minor change to add specificity] Element in the Discussion Draft 1A1. Adopt a written code of ethics and adhere to it in implementing the land trust s mission, in its governance and in its operations 1A2. Adopt a written whistleblower policy that protects individuals who come forward with information on illegal practices or unethical behavior 1A3. Do not participate in transactions that are fraudulent or abusive or have a high risk of being so 1B1. Adopt a mission that serves conservation in the public interest 1B2. Review the mission statement to ensure it is relevant and reflects current activities whenever the board conducts strategic planning 2

3 1B. The land trust regularly establishes strategic goals for implementing its mission 1B. The land trust routinely evaluates programs, goals and activities to be sure they are consistent with the mission 1C. The land trust communicates its mission, goals and/or programs to members, donors, landowners, the general public, community leaders, conservation organizations and others in its service area as appropriate to carry out its mission 1B. Planning and Evaluation 1C. Planning and Evaluation [Minor change to add specificity] An evaluation of programs and activities against the strategic goals is more specific and has a greater significance to the land trust s operations than an evaluation against consistency with the mission. [Other minor change to add specificity] 1C. Community Outreach 1D. Community Engagement Broadly engaging the community will ensure a land trust s work is relevant and meaningful to its community and will help build widespread support for land conservation. 1C1. Establish strategic goals for implementing the mission, and review or update them at least every five years 1C2. Evaluate programs and activities at least annually to ensure they are advancing the strategic goals 1D1. Communicate the land trust s mission to landowners, community leaders and the general public to demonstrate through programs and activities how and why land conservation is important in the community 1D2. Build relationships with elected officials and support conservation policies that are appropriate to the land trust s mission 1D3. Develop an organizational culture that respects and welcomes diversity and engages people who are broadly representative of the communities in which the land trust works 3

4 Standard 2: Compliance with Laws Land trusts fulfill their legal requirements as nonprofit tax-exempt organizations and comply with all laws. Element in the Current Standards 2A. The land trust complies with all applicable federal, state and local laws Concerns Identified by the Land Trust Community 2A. Compliance with Laws [No significant change] Element in the Discussion Draft 2A1. Conduct operations in compliance with applicable laws 2B. The land trust has incorporated according to the requirements of state law and maintains its corporate status 2B. Nonprofit Incorporation and Bylaws [No significant change] 2B1. Incorporate or organize according to the requirements of state law and maintain legal status 2B. The land trust operates under bylaws based on its corporate charter or articles of incorporation 2B. The board periodically reviews the bylaws - A land trust s bylaws should comply with state law. - Periodically is an unspecified amount of time. - The purpose of the review of the bylaws is not clear. 2B2. Operate in accordance with bylaws that comply with state law 2B3. Review the bylaws at least once every five years to ensure they reflect current operations and are consistent with the articles of incorporation and state law. 4

5 2C. The land trust has qualified for federal tax-exempt status 2C. The land trust complies with requirements for retaining its tax-exempt status, including prohibitions on private inurement and political campaign activity, and limitations and reporting on lobbying and unrelated business income 2C. Tax Exemption/2E. Public Policy 2C. Tax Exemption Qualifying for and maintaining tax-exempt status can be simplified into one element. Submitting the appropriate Form 990 (either a Form 990-N, a Form 990-EZ, or the full Form 990) is a required to maintain the land trust s tax-exempt status. [Minor change to simplify the language and eliminate the redundancies] 2C1. Maintain status as a tax-exempt organization under section 501(c)(3) of the Internal Revenue Code (IRC) 2C2. File a complete and accurate Form 990 with the Internal Revenue Service annually 2C3. Do not engage in prohibited activities, such as private inurement or impermissible private benefit 2E. The land trust may engage in public policy at the federal, state and/or local level (such as supporting or opposing legislation, advocating for sound land use policy, and/or endorsing public funding of conservation) provided that it complies with federal and state lobbying limitations and reporting requirements 2E. Land trusts may not engage in political campaigns or endorse candidates for public office [Minor change to align with the Internal Revenue Service definition of political campaigns] 2C4. Comply with federal and state lobbying limitations and reporting requirements when lobbying elected officials 2C5. Do not engage in political campaigns on behalf of or in opposition to any candidate for public office 5

6 2C. If the land trust holds, or intends to hold, conservation easements, it also meets the Internal Revenue Code's (IRC) public support test for public charities 2C. Where applicable, state taxexemption requirements are met 2D. The land trust has adopted a written records policy that governs how organization and transaction records are created, collected, retained, stored and disposed. This element overlaps with standard 10. [Moved to practice 10B. Legal Requirements: Land Trust Responsibilities] State tax-exemption requirements vary N/A Eliminated by state, and there is no one national standard. 2D. Records Policy 9G. Recordkeeping This element overlaps with the [Moved to practice 9G. Recordkeeping] recordkeeping elements in standard 9. 6

7 Standard 3: Board Accountability Land trust boards act ethically in conducting the affairs of the organization and carry out their legal and financial responsibilities as required by law. Element in the Current Standards Concerns Identified by the Land Trust Community Element in the Discussion Draft 3A. Board Responsibility/3C. Board Governance/3E. Delegation of Decision Making Authority 3A. Board Responsibility 3A. The board is responsible for establishing the organization s mission, determining strategic direction and setting policies to carry out the mission Redundant to the practices in standard 1 for mission and planning and evaluation. [Moved to standard 1] 3C. The land trust informs [board members] about the board s legal and fiduciary responsibilities 3A. As required by law, the board is responsible for the oversight of the organization s finances and operations 6A. The land trust prepares an annual budget that is reviewed and approved by the board, or is consistent with board policy 6C. The board receives and reviews financial reports and statements in a form and with a frequency appropriate for the scale of the land trust's financial activity [Minor change to clarify the responsibilities of individual board members] Reviewing the externally prepared financial audit, review or compilation and ensuring that sufficient financial resources are available are also important responsibilities of the board. [Other minor change to simplify the language] 3A1. Individual board members understand their role and their responsibilities as nonprofit board members, including their legal and fiduciary duties 3A2. The board provides oversight of the land trust s finances and operations by a. Reviewing and approving an annual budget b. Ensuring that sufficient financial resources are available c. Receiving and reviewing financial reports and statements in a form and with a frequency appropriate for the scale of the land trust's financial activity d. Reviewing the externally prepared financial audit, review or compilation 7

8 3E. If the land trust has staff, the board defines the job of, oversees and periodically evaluates the executive director (or chief staff person). 3E. The board may delegate decision-making and management functions to committees, provided that committees have clearly defined roles and report to the board or staff. 3B. The board is of sufficient size to conduct its work effectively 3B. The board is composed of members with diverse skills, backgrounds and experiences who are committed to board service N/A 3B. There is a systematic process for recruiting, training and evaluating board members N/A [No significant change] [No change] 3B. Board Composition 3B. Board Composition and Structure Commitment to board service is difficult for a land trust to determine and implement. [Other minor change to simplify the language] Independence of board members is part of Independent Sector s Principles for Good Governance and Ethical Practice. [Minor change to specify a board development plan; Evaluation moved to practice 3C. Board Governance] Separation of duties is part of Independent Sector s Principles for Good Governance and Ethical Practice. 3A3. The board hires, oversees and annually evaluates the performance of any executive director (or chief staff person) 3A4. The board may delegate decisionmaking and management functions to committees, provided that committees have clearly defined roles and report to the board or staff 3B1. Have a board of sufficient size, skills, backgrounds and experiences to conduct its work effectively 3B2. Have a board of substantially independent members 3B3. Have a board development plan that includes a systematic process for recruiting and training board members 3B4. Ensure the board s presiding officer and treasurer are not the same individual 8

9 N/A - Individuals that serve dual roles as land trust staff and board members have the potential to have undue influence over the organization, which can be mitigated by clear roles and limits. - Separation of duties is part of Independent Sector s Principles for Good Governance and Ethical Practice. 3C. The land trust provides board members with clear expectations for their service 3C. The board meets regularly enough to conduct its business and fulfill its duties, with a minimum of three meetings per year 3C. Board members are provided with adequate information to make good decisions 3B5. If a staff member serves on the board, clearly define the staff role and limit the board member role accordingly to ensure separation of duties and avoid undue influence a. No staff member serves as the board s presiding officer or treasurer 3C. Board Governance/3D. Preventing Minority Rule 3C. Board Governance [No significant change] - Most state laws require that meeting minutes be kept. - Meeting minutes are a critical record of the land trust s decisions. [Other minor change to simplify the language] [Minor change to increased specificity] 3C1. Provide board members with written expectations for their service on the board 3C2. The board meets a minimum of three times per year and maintains adopted minutes of each meeting 3C3. Provide board members with sufficient and timely information in writing prior to each meeting to make informed decisions 9

10 3C. Board members attend a majority of meetings 3B. There is a systematic process for recruiting, training and evaluating board members 3C. Board members stay informed about the land trust s mission, goals, programs and achievements N/A Board attendance is only one component of determining whether board members are fulfilling their responsibilities. Overall evaluation of board members and a process to remove board members that are unable to fulfill their responsibilities are more essential (see 3C4 and 3C5 below). - It is unclear what portion of the board the evaluation should apply to. - It is not clear how often the evaluation should occur. [Recruiting and training moved to practice 3B. Board Composition and Structure] Board members stay informed by attending meetings, engaging in planning and evaluation, etc. Procedures for removing board members that are unable to fulfill their responsibilities are part of Independent Sector s Principles for Good Governance and Ethical Practice. N/A Eliminated 3C4. Board members evaluate their performance annually as a group and as individuals at least once every three years N/A - Eliminated 3C5. Adopt clear procedures for removing board members who are not fulfilling their responsibilities 10

11 3D. The land trust s governing documents contain policies and procedures (such as provisions for a quorum and adequate meeting notices) that prevent a minority of board members from acting for the organization without proper delegation of authority 3F. The board reviews and approves every land and easement transaction 3F. However, the board may delegate decision-making authority on transactions if it establishes policies defining o The limits to that authority o The criteria for transactions o The procedures for managing conflicts of interest o The timely notification of the full board of any completed transactions and if the board periodically evaluates the effectiveness of these policies [No change] 3C6. Have governing documents that contain policies and procedures (such as provisions for a quorum and adequate meeting notices) to prevent a minority of board members from acting for the land trust without proper delegation of authority 3F. Board Approval of Land Transactions 3D. Board Approval of Transactions Some land trusts use provisions in the bylaws to delegate decision-making authority. [Other minor change to simplify the language] 3D1. The board reviews and approves every land and easement transaction a. However, the board may delegate decision-making authority on transactions if i. It establishes written policies or has bylaws provisions that define the limits to the authority given to the delegated entity ii. The delegated entity provides timely notification in writing to the full board of any completed transactions 11

12 3F. The land trust provides the board with timely and adequate information prior to final approval Timely and adequate information prior to decision making is addressed as part of board governance. [Moved to practice 3C. Board Governance] 12

13 Standard 4: Conflicts of Interest Land trusts have policies and procedures to avoid or manage real or perceived conflicts of interest. Element in the Current Standards 4A. The land trust has a written conflict of interest policy to ensure that any conflicts of interest or the appearance thereof are avoided or appropriately managed through disclosure, recusal or other means 4A. The conflict of interest policy applies to insiders, including board and staff members, substantial contributors, parties related to the above, those who have an ability to influence decisions of the organization and those with access to information not available to the general public Concerns Identified by the Land Trust Community 4A. Dealing with Conflicts of Interest [Minor change to simplify the language] [The term insiders will continue to be defined as board and staff members, substantial contributors, parties related to the above, those who have an ability to influence decisions of the organization and those with access to information not available to the general public.] Element in the Discussion Draft 4A1. Adopt a written conflict of interest policy that addresses, for all insiders, how conflicts are identified and avoided or managed 4A. Federal and state conflict disclosure laws are followed [Minor change to add specificity] 4A2. Document the disclosure and management of actual and potential conflicts 13

14 4B. Board members do not serve for personal financial interest 4B. Board members are not compensated except for reimbursement of expenses and, in limited circumstances, for professional services that would otherwise be contracted out o Any compensation must be in compliance with charitable trust laws 4B. The board s presiding officer and treasurer are never compensated for professional services 4B. Board Compensation [Minor change to add clarity and specificity] [No change] 4B1. Do not financially compensate board members, except for reimbursement of expenses and, in limited circumstances, for professional services that would otherwise be contracted out a. If the land trust compensates a board member for professional services, i. Adopt written criteria that establish the conditions under which it will do so ii. Document how it uses appropriate comparability data to determine the amount to be paid and to confirm that there is no private inurement 4B2. Ensure the board s presiding officer and treasurer are never compensated for professional services 14

15 4C. When engaging in land and easement transactions with insiders, the land trust: o Follows its conflict of interest policy o Documents that the project meets the land trust s mission o Follows all transaction policies and procedures o Ensures that there is no private inurement or impermissible private benefit 4C. For purchases and sales of property to insiders, the land trust obtains a qualified independent appraisal prepared in compliance with the Uniform Standards of Professional Appraisal Practice by a statelicensed or state-certified appraiser who has verifiable conservation easement or conservation real estate experience 4C. Transactions with Insiders The land trust s project-selection criteria need to be consistent with the mission. Therefore, a project that meets the land trust s transaction procedures/policies will also meet the mission. [Minor change to simplify the language] 4C1. When engaging in land and easement transactions with insiders, a. Follow the conflict of interest policy b. Follow all transaction policies and procedures c. Ensure that there is no private inurement 4C2. For purchases and sales of property to insiders, obtain an independent appraisal by a qualified appraiser 15

16 4C. When selling property to insiders, the land trust widely markets the property in a manner sufficient to ensure that the property is sold at or above fair market value and to avoid the reality or perception that the sale inappropriately benefited an insider N/A N/A [Minor change to simplify the language] Financial transactions with insiders need to be managed appropriately to ensure there is no private inurement. A prohibition on loans to directors, officers, or trustees is part of Independent Sector s Principles for Good Governance and Ethical Practice. 4C3. When selling property to insiders, ensure that it is sold at or above fair market value to avoid the reality or perception that the sale inappropriately benefited an insider 4C4. When engaging in financial transactions with insiders, contemporaneously document that there is no private inurement 4C5. Do not provide loans to directors, officers or trustees 16

17 Standard 5: Fundraising Land trusts conduct fundraising activities in a lawful, ethical and responsible manner. Element in the Current Standards 5A. The land trust complies with all charitable solicitation laws 5A. The land trust does not engage in commission-based fundraising 5A. The land trust limits fundraising costs to a reasonable percentage of overall expenses Concerns Identified by the Land Trust Community 5A. Legal and Ethical Practices - Strict compliance with charitable solicitation laws is challenging for land trusts, especially in light of increasing online contributions. - The Standards should reflect that a reasoned and reasonable analysis of where to register is acceptable. [Minor change to clarify what is commission-based fundraising] While limiting fundraising costs is part of being a responsible charity, this has not been a concern in the land trust community. Element in the Discussion Draft 5A1. Conduct an analysis of state charitable solicitation laws and register where the land trust determines it to be necessary 5A2. Do not compensate internal or external fundraisers based on a commission or a percentage of the amount raised N/A Eliminated 5B. Accountability to Donors/5C. Accurate Representations 5B. Accountability to Donors [Minor change to simplify the language] 5C. All representations made in promotional, fundraising, and other public information materials are accurate and not misleading with respect to the organization's accomplishments, activities and intended use of funds 5B1. Provide accurate and truthful solicitation materials and other communications to donors and the public 17

18 5B. The land trust is accountable to its donors 5B. The land trust ensures that donor funds are used as specified 5B. The land trust provides written acknowledgement of gifts as required by law 5B. The land trust is accountable to its donors 5C. All funds are spent for the purpose(s) identified in the solicitation or as directed in writing by the donor 5B. The land trust keeps accurate records 5B. The land trust honors donor privacy concerns 5B. The land trust advises donors to seek independent legal and financial advice for substantial gifts N/A Donor funds being properly classified is key to ensuring that donor funds are used as specified. [No significant change] Complying with the donor s restrictions applies to all gifts (e.g., money, conservation easements, land, etc.). Accurate financial records are part of standard 6. [Minor change to require a policy or procedure] This item overlaps with a similar element in standard 9. 5C. Fundraising Plan The Standards should be strengthened to address the financial viability of land trusts. 5B2. Classify all funds as unrestricted, temporarily restricted or permanently restricted as identified in written communications with, or as directed in writing by, the donor 5B3. Provide timely written acknowledgment of all gifts, including land and conservation easements, as required by law 5B4. Comply with the donor s written restrictions for all gifts [Part of practice 6B. Financial Records] 5B5. Have a written policy or procedure to ensure donor privacy concerns are honored [Moved to practice 9B. Independent Legal Advice] 5C1. Develop and implement a fundraising plan or program appropriate to the land trust s size and scope to ensure it can support its activities 18

19 8L. A land trust may receive land that does not meet its project selection criteria with the intent of using the proceeds from the sale of the property to advance its mission 8L. If the land trust intends to sell the land, it provides clear documentation to the donor of its intent before accepting the property 8L. Practices 4C, 9K and 9L are followed 12H. When a land trust holds fee land with the intention to sell or transfer the land, the land trust is open about its plans with the public 12H. The land trust manages and maintains the property in a manner that retains the land trust s public credibility 8L. Nonconservation Lands 5D. Non-conservation Properties for Resale Non-conservation properties are better categorized as a financial asset and a fundraising strategy. For clarity, the elements for these types of projects are consolidated in one location. 5D1. When acquiring non-conservation property with the intent of selling it to support land trust programs, a. Obtain a written acknowledgement from any donor of the land trust s intent to sell before accepting the property b. Follow existing transaction policies and procedures c. Maintain the property while in the land trust s ownership in a manner that retains the land trust s public credibility 19

20 5D. Prior to entering into an agreement to allow commercial entities to use the land trust s logo, name or properties, the land trust determines that these agreements will not impair the credibility of the land trust 5D. The land trust and commercial entity publicly disclose how the land trust benefits from the sale of the commercial entity s products or services 5D. Marketing Agreements 5E. Marketing Agreements [No change] While public disclosures about marketing agreements are important, this has not been a widespread issue in the land trust community. 5E1. Prior to entering into an agreement to allow commercial entities to use the land trust s logo, name or properties, determine that these agreements will not impair the land trust s credibility N/A Eliminated 20

21 Standard 6: Financial Oversight Land trusts are responsible and accountable for how they manage their finances and assets. Element in the Current Standards Concerns Identified by the Land Trust Community Element in the Discussion Draft 6A. Annual Budget/6F. Investment and Management of Financial Assets and Dedicated Funds/6G. Funds for Stewardship and Enforcement 6A. Fiscal Health 6A. The land trust prepares an annual budget that is reviewed and approved by the board, or is consistent with board policy This item is redundant to the board s responsibility in standard 3 to provide fiscal oversight. [Moved to practice 3A. Board Responsibility] 6A. The budget is based on programs planned for the year 6A. Annual revenue is greater than or equal to expenses, unless reserves are deliberately drawn upon 6G. The land trust has a secure and lasting source of dedicated or operating funds sufficient to cover the costs of stewarding its land and easements over the long term and enforcing its easements 6G. In the event that full funding for these costs is not secure, the board has adopted a policy committing the organization to raising the necessary funds. [Minor change to simplify the language] [Minor change to simplify the language] 6A1. Adopt an annual budget in which the revenues are greater than or equal to expenses, unless the board deliberately draws on the reserves 6A2. Have dedicated or restricted funds sufficient to cover the long-term costs of stewarding and defending the land trust s land and easements a. If funds are insufficient, adopt a plan to secure these funds and a policy committing the funds to this purpose 21

22 11A. The land trust secures the dedicated or operating funds to cover current and future expenses o If funds are not secured at or before the completion of the transaction, the land trust has a plan to secure these funds and has a policy committing the funds to this purpose 12A. The land trust secures the dedicated and/or operating funds needed to manage the property, including funds for liability insurance, maintenance, improvements, monitoring, enforcement and other costs o If funds are not secured at or before the completion of the transaction, the land trust has a plan to secure these funds and has a policy committing the funds to this purpose N/A N/A See above The Standards should be strengthened to address the financial viability of land trusts. 22 See above 6A3. Assess the nature and variability of revenue sources and establish a commensurate level of operating reserves to sustain operations 6A4. Avoid overreliance on a single donor or single funding source over time

23 N/A See above 6A5. Do not borrow from permanently restricted funds to cover operating costs 6F. The land trust has a system for the responsible and prudent investment and management of its financial assets [Minor change to simplify the language] 6A6. Adopt written policies or procedures to ensure responsible and prudent investment, management and use of financial assets 6F. The land trust has established policies on allowable uses of dedicated funds and investment of funds 6G. The land trust tracks stewardship and enforcement costs 6G. The land trust periodically evaluates the adequacy of its funds 6B. The land trust keeps accurate financial records 6B. Financial records are kept in a form appropriate to the land trust s scale of operations and in accordance with Generally Accepted Accounting Principles (GAAP) or alternative reporting method acceptable to a qualified financial advisor Redundant to elements in standards 11 and 12. 6B. Financial Records [Minor change to simplify the language] [Moved to practice 11A. Funding Conservation Easement Stewardship and practice 12A. Funding Land Stewardship] 6B1. Keep financial records in accordance with Generally Accepted Accounting Principles (GAAP) or an alternative reporting method acceptable to a qualified financial professional 23

24 6C. The board receives and reviews financial reports and statements in a form and with a frequency appropriate for the scale of the land trust's financial activity 6D. The land trust has an annual financial review or audit, by a qualified financial advisor, in a manner appropriate for the scale of the organization and consistent with state law 6E. The land trust has established a sound system of internal controls and procedures for handling money, in a form appropriate for the scale of the organization 6C. Financial Reports and Statements 3A. Board Responsibility Part of the board s responsibility in standard 3 to provide fiscal oversight. [Moved to practice 3A. Board Responsibility] 6D. Financial Review or Audit 6C. External Financial Evaluation [Minor change to add an option for a compilation ] 6C1. Obtain an annual financial audit, review or compilation by an independent qualified financial professional, in a manner appropriate for the scale of the organization and consistent with state law 6E. Internal System for Handling Money 6D. Internal System for Handling Money [Minor change to add specificity] 6D1. Establish written internal controls and accounting procedures for handling money, in a form appropriate for the scale of the organization, to prevent the misuse or loss of funds 6H. Sale or Transfer of Assets 9I. Selling Land or Conservation Easements/9J. Transfers and Exchanges of Land or Conservation Easements 6H. The land trust has established policies or procedures on the transfer or - Policies and procedures are less essential than the outcome of when the land trust does these activities. [Moved to practices 9I. Selling Land or Conservation Easements and 9J. Transfers and Exchanges of Land or sale of assets, including real property. - Redundant to elements in standard 9. Conservation Easements] 24

25 6I. Risk Management and Insurance 6E. Risk Management and Insurance 6I. The land trust assesses and [Minor change to simplify the language manages its risks and add specificity] 6I. The land trust exercises caution before using its land to secure debt and in these circumstances takes into account any legal or implied donor restrictions on the land, the land trust's mission and protection criteria, and public relations impact 6I. The land trust carries [Minor change to add specificity] liability, property, and other insurance appropriate to its risk exposure and state law 6E1. Routinely assess and manage risks to ensure they do not jeopardize the land trust s financial health and its ability to carry out its mission and legal responsibilities a. Use a high level of due diligence before using land to secure debt 6E2. Carry general liability, director s and officer s liability, property and other insurance appropriate to the land trust s risk exposure and state law 25

26 Standard 7: Human Resources Land trusts have sufficient skilled personnel to carry out their programs, whether volunteers, staff and/or consultants/contractors. Element in the Current Standards 7A. The land trust regularly evaluates its programs, activities and long-term responsibilities 7A. The land trust has sufficient volunteers, staff and/or consultants to carry out its work, particularly when managing an active program of easements 7B. If the land trust uses volunteers, it has a program to attract, screen, train, supervise and recognize its volunteers 7H. Consultant and contractor relationships are clearly defined, are consistent with federal and state law, and, if appropriate, are documented in a written contract Concerns Identified by the Land Trust Community 7A. Capacity Redundant to other planning and evaluation elements in standard 1. [Minor change to have an evaluation of capacity and to add capacity as needed] 7B. Volunteers [Minor change to simplify the language] 7H. Working with Consultants 7C. Consultants or Contractors [No change] Element in the Discussion Draft [Moved to practice 1C. Planning and Evaluation] 7A1. Evaluate whether the land trust has sufficient volunteers, staff and/or consultants/contractors to carry out its strategic goals and add capacity as needed 7B1. Provide volunteers with training, supervision and recognition 7C1. Clearly define relationships with consultants or contractors, ensure they are consistent with federal and state law and document them in a written contract, as appropriate 26

27 7H. Consultants and contractors are familiar with sections of Land Trust Standards and Practices that are relevant to their work Controlling knowledge of consultants and contractors may not be possible for land trusts. N/A Eliminated 7C. Staff/7D. Availability of Training and Expertise/7E. Board/Staff Lines of Authority/7F. Personnel Policies/7G. Compensation and Benefits 7D. Staff (for land trusts with staff) 7C. If the land trust uses staff, each staff member has written goals or job descriptions and periodic performance reviews [No significant change] 7D1. Have a written job description for each staff member and conduct periodic performance reviews 7C. Job duties or work procedures for key positions are documented to help provide continuity in the event of staff turnover 7E. If the land trust has staff, the lines of authority, communication and responsibility between board and staff are clearly understood and documented 7D. Volunteers and staff have appropriate training and experience for their responsibilities and/or opportunities to gain the necessary knowledge and skills This element overlaps with having written job descriptions. [Minor change to simplify the language] [No change] N/A Eliminated 7D2. Document the lines of authority, communication and responsibility between board and staff 7D3. Ensure staff have appropriate training and experience for their responsibilities and/or opportunities to gain the necessary knowledge and skills 27

28 7E. If the board hires an executive director (or chief staff person), the board delegates supervisory authority over all other staff to the executive director. 7F. If the land trust has staff, it has written personnel policies that conform to federal and state law and has appropriate accompanying procedures or guidelines 7G. If the land trust has staff, it provides fair and equitable compensation and benefits, appropriate to the scale of the organization N/A - While delegation of supervisory authority is important, this has not been a widespread issue in the land trust community. - Delegation of supervisory authority is also slightly redundant to having lines of authority, communication, and responsibilities documented (see 7D2 above). [Minor change to simplify the language] [No change] Succession plans are vital to the longterm viability of land trust operations. N/A Eliminated 7D4. Adopt written personnel policies that conform to federal and state law 7D5. Provide fair and equitable compensation and benefits, appropriate to the scale of the land trust 7D6. Develop a written succession plan to ensure continuity in the leadership and management of the land trust s core functions 28

29 Standard 8: Evaluating and Selecting Conservation Projects Land trusts carefully evaluate and select their conservation projects. Element in the Current Standards 8A. The land trust has identified specific natural resources or geographic areas where it will focus its work 8B. The land trust has a defined process for selecting land and easement projects 8B. The land trust has written selection criteria that are consistent with its mission 8D. The land trust evaluates and clearly documents how the benefits are consistent with the mission of the organization 8B. For each project, the land trust evaluates its capacity to perform any perpetual stewardship responsibilities 8D. The land trust evaluates and clearly documents the public benefit of every land and easement transaction Concerns Identified by the Land Trust Community 8A. Identify Focus Areas A land trust s conservation work and priorities may be broader than protecting specific natural resources. 8B. Project Selection and Criteria/8D. Public Benefit of Transactions 8B. Project Selection Criteria and Public Benefit [No significant change] [No significant change] Analysis of capacity is part of project planning. [No significant change] Element in the Discussion Draft 8A1. Identify specific conservation priorities or geographic areas where the land trust focuses its work 8B1. Develop a written process to select land and conservation easement projects 8B2. Adopt and apply written projectselection criteria that are consistent with the land trust s mission [Moved to practice 8D. Project Planning] 8B3. Document the public benefit of every land and conservation easement project 29

30 8D. All projects conform to applicable federal and state charitable trust laws 8D. If the transaction involves public purchase or tax incentive programs, the land trust satisfies any federal, state or local requirements for public benefit 8C. For land and easement projects that may involve federal or state tax incentives, the land trust determines that the project meets the applicable federal or state requirements, especially the conservation purposes test of IRC 170(h) - There is overlap with practice 2A, which specifies operations should be compliant with all applicable laws. - There is some overlap with practice 10C that specifies applicable transactions should be consistent with federal and state income tax deduction requirements. - This element overlaps with practice 10C that specifies applicable transactions should be consistent with federal and state income tax deduction requirements, including the conservation purposes test of the Internal Revenue Code. - This element also overlaps with overall analysis of public benefit in practice 8B. N/A Eliminated [Moved to practice 8B. Project Selection Criteria and Public Benefit and practice 10C. Defending Against Fraudulent Transactions] 8C. Federal and State Requirements 10C. Defending Against Fraudulent Transactions This element overlaps with practice 10C that specifies applicable transactions should be consistent with federal and state income tax deduction requirements, including the conservation purposes test of the Internal Revenue Code. [Moved to practice 10C. Defending Against Fraudulent Transactions] 30

31 8E. Site Inspection/8F. Documenting Conservation Values/8K. Evaluating Risks 8C. Property Evaluation 8E. The land trust inspects properties before buying or accepting donations of land or easements to o Be sure they meet the organization's criteria o Identify the important conservation values on the property [Minor change to simplify the language] 8C1. Inspect properties before buying or accepting donations of land or conservation easements to document: a. That the project meets the land trust's project-selection criteria b. The important conservation values on the property c. Any potential threats or risks to those values o Reveal any potential threats to those values 8F. The land trust documents the condition of the important conservation values and public benefit of each property, in a manner appropriate to the individual property and the method of protection 8K. The land trust examines the project for risks to the protection of important conservation values (such as surrounding land uses, extraction leases or other encumbrances, water rights, potential credibility issues or other threats) 8K. The land trust evaluates whether it can reduce the risks [Minor change to simplify the language] 8C2. Evaluate potential risks to the conservation values on the property and modify the project or turn it down if the risks outweigh the benefits 31

32 8K. The land trust modifies the project or turns it down if the risks outweigh the benefits See above See above 8B. Project Selection and Criteria/8G. Project Planning/8H. Evaluating the Best Conservation Tool 8G. All land and easement projects are individually planned so that o The property's important conservation values are identified and protected o The project furthers the land trust s mission and goals o The project reflects the capacity of the organization to meet future stewardship obligations 8H. The land trust works with the landowner to evaluate and select the best conservation tool for the property 8H. The land trust takes care that the chosen method can reasonably protect the property s important conservation values over time 8B. For each project, the land trust evaluates its capacity to perform any perpetual stewardship responsibilities 8D. Project Planning [Minor change to simplify the language] [Minor change to simplify the language] 32 8D1. Individually plan all land and conservation easement projects so that: a. The land trust identifies the best available conservation strategy for the property b. The property's important conservation values are identified, documented and protected c. The project furthers the land trust s mission and goals 8D2. Assess the stewardship implications of each project and the land trust s capacity to meet those obligations

33 8H. This evaluation may include informing the landowner of appropriate conservation tools and partnership opportunities, even those that may not involve the land trust 8I. The land trust evaluates whether it has the skills and resources to protect the important conservation values on the property effectively - This element is part of selecting the best conservation strategy for the property. - Informing landowners of other opportunities is not essential to be part of the Standards. N/A - Eliminated 8I. Evaluating Partnerships/8J. Partnership Documentation 8E. Partnership Documentation Analysis of capacity is part of project [Moved to practice 8D. Project Planning] planning. 8I. The land trust evaluates whether it should refer the project to, or engage in a partnership with, another qualified conservation organization Analysis of whether the land trust is the appropriate organization for the project is part of the analysis of the project against the land trust s criteria and is part of the project planning process. N/A - Eliminated 33

34 8J. If engaging in a partnership on a joint acquisition or longterm stewardship project, agreements are documented in writing to clarify, as appropriate o The goals of the project o Roles and responsibilities of each party o Legal and financial arrangements o Communications to the public and between parties o Public acknowledgement of each partner s role in the project 8L. A land trust may receive land that does not meet its project selection criteria with the intent of using the proceeds from the sale of the property to advance its mission 8L. If the land trust intends to sell the land, it provides clear documentation to the donor of its intent before accepting the property 8L. Practices 4C, 9K and 9L are followed Public acknowledgement of roles may not always be necessary. 8L. Nonconservation Lands 5D. Non-conservation Properties for Resale Non-conservation properties intended for resale are more like a financial asset and a fundraising strategy than a conservation project. 8E1. When engaging in a partnership on a joint acquisition or long-term stewardship project or when co-holding conservation easements, create written agreements to clarify: a. The goals of the project b. The roles and responsibilities of each party c. Legal and financial arrangements d. Communications to the public and between parties [Moved to practice 5D. Non-conservation Properties for Resale] 34

35 8M. A land trust engaging in projects beyond direct land protection (such as public policy, regulatory matters or education programs) has criteria or other standard evaluation methods to guide its selection of and engagement in these projects 8M. The criteria or evaluation methods consider mission, capacity and credibility 8M. Public Issues 1B. Planning and Evaluation - Specifically requiring criteria for N/A - Eliminated projects beyond direct land protection is not essential to be part of the Standards. - Standard 1 addresses overall evaluation of programs and activities. 35

36 Standard 9: Ensuring Sound Transactions Land trusts ensure that every land and conservation easement transaction is legally, ethically and technically sound. Element in the Current Standards 9A. The land trust obtains a legal review of every land and easement transaction, appropriate to its complexity, by an attorney experienced with real estate law Concerns Identified by the Land Trust Community 9A. Legal Review and Technical Expertise [No change] Element in the Discussion Draft 9A1. Obtain a legal review of every land and conservation easement transaction, appropriate to its complexity, by an attorney experienced with real estate law 9A. As dictated by the project, the land trust secures appropriate expertise in financial, real estate, tax, scientific, and land and water management matters 9B. The land trust refrains from giving specific legal, financial and tax advice 9B. The land trust recommends in writing that each party to a land or easement transaction obtain independent legal advice [No change] 9B. Independent Legal Advice While land trusts should not provide specific advice to landowners, land trusts do (and should) provide information to landowners. [No change] 9A2. As dictated by the project, secure appropriate expertise in financial, real estate, tax, scientific and land and water management matters 9B1. Provide information, but do not give specific legal, financial or tax advice 9B2. Recommend in writing that each party to a land or conservation easement transaction obtain independent legal advice 36

37 9C. The land trust takes steps, as appropriate to the project, to identify and document whether there are hazardous or toxic materials on or near the property that could create future liabilities for the land trust 9C. Environmental Due Diligence for Hazardous Materials Land trusts should evaluate properties for hazardous materials to understand the risks when accepting land and conservation easements. 9C1. Obtain or conduct a preliminary environmental assessment (a preliminary investigation, transaction screen or Phase I assessment) for every land and conservation easement transaction and take steps to address any significant concerns 9D. The land trust determines the boundaries of every protected property through legal property descriptions, accurately marked boundary corners or, if appropriate, a survey 9D. Determining Property Boundaries Land trusts should determine both the 9D1. Determine both the legal and physical legal and physical boundaries of its boundaries of every protected property protected properties. through legal property descriptions, accurately marked boundary corners or a survey 9D. If an easement contains restrictions that are specific to certain zones or areas within the property, the locations of these areas are clearly described in the easement and supporting materials and can be identified in the field The easement document itself needs to contain the relevant information about specific building areas or specifically protected areas. 9D2. If a conservation easement contains restrictions or permitted rights that are specific to certain zones or areas within the property, clearly describe the locations of these areas in the easement document and ensure they can be identified in the field 37