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Have Your Ranch & Develop It, Too

 
  The Sand Creek Ranch. Courtesy photo.

The Sand Creek Ranch sits on about 850 acres of Wyoming prairie near the Big Horn Mountains and the small town of Buffalo. It’s the kind of place a real estate developer might dream of slicing into pieces of Western paradise. The ranch, like hundreds of others across the Mountain West, is worth far more with cul-de-sacs than cattle.

John Jenkins, who 40 years ago helped his newly widowed mother downsize from a large spread on the Powder River to this smaller ranch, has a powerful reason to protect the property and to preserve a portion of its, and his, agricultural heritage.

“I want to keep it open. I cast my mother’s ashes to the wind out there on the big meadow,” says Jenkins, who recently retired after a career as an oilman and political consultant. “But, realistically,” he adds, “because I’m a businessman, I know that its highest and best use is really as real estate.”

Those competing impulses explain why he plans to split the difference by placing 500 acres into an easement for continued use as ranchland and divvying the remaining acreage into 99 home sites.

As a development model, the combination of open space and clustered home sites dates to the 1960s with the work of landscape architect Ian McHarg, who laid out a method for analyzing the components of a piece of land in his influential book Design With Nature.

Raised in an industrialized suburb of Glasgow in Scotland, McHarg designed housing developments in America with some principles of English design used for garden estates. McHarg’s designs incorporated the natural world into the developed landscape. He pioneered the now-standard use of map overlays as a way to display spatial data. Each map would include a different field of data — wildlife habitat, riparian areas, residential and others. McHarg’s system became the basis for the science known as GIS — geographic information systems.

In the Mountain West, as the human footprint has grown more pronounced, an increasing number of developers have begun to place conservation easements and other permanent restrictions on land within their development packages. The practice moved from rare to common in Colorado when state law there allowed landowners to turn an easement’s tax benefits into cash by selling them as tax credits, says Catherine Keske, an economist at Colorado State University who studies conservation and development.

Bob Cardwell, who spent 30 years in Colorado and elsewhere developing and financing real estate, first considered conservation developments about 10 years ago. One impetus was to avoid drawing the wrath of the local community with just another cookie-cutter development. Another was a budding urge to figure out how to preserve the openness and views of the high plains and mountains he loved.

“I thought, ‘How do I get out of the box?’ and along comes the idea of the conservation easement,” Cardwell says.

One conservation development, notable for its size and beauty, is the Storm Mountain Ranch near Steamboat Springs, Colo. Another is the Sun Ranch near Bozeman, Mont. The Sun Ranch Institute has been perfecting a nonprofit model to use the market to sell some homes, maintain agriculture and conserve key pieces of land, and news of its efforts have prompted calls from developers and landowners from Texas to California and even Costa Rica.

“We are developing at about three times the rate that we’re conserving things, so we’ve got to start looking at these techniques,” says Martin Zeller, president of Denver-based Conservation Partners, a firm that works with land trusts and private developers.

For Jenkins in Wyoming, the decision to both develop home sites and place land under conservation easements came about gradually over a period of about eight or nine years. The process began in 1997, after Jenkins’ mother died, as he and his siblings felt financial pressure to cut the land up and sell it as part of the liquidation of his mother’s estate. Agricultural acreage was cheap enough at the time that he was able to buy the ranch himself.

Jenkins wanted to protect the ranch land, but the cost of the conservation seemed daunting. He researched options and liked the idea of a thorough analysis of the qualities of the land, which would then drive the placement of home sites and the protective easements. He added another dimension when he established the agricultural operation as a nonprofit, giving each homeowner a share of the business.

The idea, Jenkins says, is to give buyers the feeling that they’re getting an 850-acre ranch without the price tag, or the upkeep.

“People want to live out there,” he says. “If you want to serve both masters, you’ve got to find a way to give people a wonderful real estate value without destroying the natural resource and wildlife values.”

–David Frey writes from Carbondale, Colo. and can be reached at david@newwest.net

For more from the Spring 2008 issue of The New West magazine, and for information on how to subscribe for free visit www.newwest.net/magazine.

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5 comments

  1. Thank you for a great article. I was glad but not a bit surprised to see Storm Mountain Ranch mentioned in your article. The Temple brothers did a wonderful job of maintaining a pristine ranch and natural area with low impact development. I believe they were one of the first to go with such a low density plan in comparison to what they could have built by right.

  2. Why can’t these places be sold with joint-tenancy-in-common covenants so the “reserve” land stays agricultural or “open space” and assessed as such on the tax rolls?
    I have a real objection to subsidizing these things with taxpayer funds when the same objectives can be achieved…same including the fact that there is no real public access to any of these amenity-migrant enclaves, easement or no easement, and therefore only the look-but-don’t-touch “benefit” of “open space.”
    Millions in tax breaks for the rich for something they would do anyway is a crock.

  3. Regarding D. Skinner comments: I have lived for ten years on a ranch proteted by covenants with a recreational easement to entire area. Covenants are less enduring than an easement and open to greater interpretation/dispute. In retrospect I would prefer that the developer had placed an easement even if it meant higher property values. Though private lands stay private lands they provide more than the look-but-don’t-touch. They provide ecological values such as ground water recharge, improved water quality, carbon sequestration, and wildlife habitat. These values transcend property lines and thus a public good

  4. clark stevens, aia,apa

    As a follow-up to this story, has there actually been confirmation that the 500 acres was accepted by the IRS for the easement? keeping 350 acres for development of 99 home sites seems a bit intensive for a legitimate easement. seems like a “dealer in real property” challenge would be likely, and so i wonder if the tax benefit was really achieved. i think we need to expand our definition of “conservation development” to rank projects according to percentage of total land preserved, contiguity of homesite and other intensive development (development footprint area), measurement of habitat value and soil fertility maintained (or better yet enhanced through direct restoration/enhancement and (legitimate) management plans. we should also look at whether the project effectively “steals absorption rate” from conventional (poor quality) rural RE development, and even evaluate the nature of the “story” of the land before and after, measuring the sociological and even mytho-poetic impacts (enhancements are possible here, with authenticity of approach) to the place.

    i am concerned that the good name of conservation is being applied to great, good, and not-so-good projects alike without any codified way of protecting a well-meaning recreational real estate purchaser by being duped. in order to avoid the green-washing that is already here and will increase over time, the profession ought to consider organizing and developing evaluation criteria and a ranking system (LEED Neighborhood won’t cut it in the rural west). i believe that there is an organization working on that, and would like to know if anybody knows the name. with over a decade of academic and professional battle-scars from attempting to bring place-appropriate inhabitation to western real estate design (there isn’t much design) and development, i would like to get involved with such an effort if one exists. if one does not yet exist, let’s get one going.

  5. Clark, very interesting comments. I think you’re absolutely right, and in fact one of the huge issues with easements (even aside from Dave’s critique relating to tax subsidies for things that would happen anyway) is that there is no real way of quantifying conservation values. That’s why calling a golf course open space can actually get you a tax break (or could before this loophole was closed). A set of tools along the lines of a “LEED for rural development” would serve a number of useful purposes. I don’t know of anything like this, but will ask around. Anyone else?