Important Changes to Maine Conservation Easement Template

The Maine Land Conservation Attorneys Network(MLCAN) recently updated its Model Conservation Easement Boilerplate, reflecting lessons learned from the front lines of the land conservation world. I’d like to take a moment of your time to walk you through a few of the key changes.

• First, a simple but helpful tweak: We have switched the terminology of the person granting the easement from "Grantor" to" Landowner." We have seen more and more land trusts make this changeover the years, and it seems to fit better in the minds of both the original donors and subsequent landowners, neither of whom tend to think of themselves as “grantors.”

• See the new language in Paragraph 10.B,providing the latest thinking on costs and fees reimbursement in the event of a violation. This new language is broader than the previous iterations insofar as it applies to enforcement costs and fees incurred by the Holder even in the absence of a formal court decision. Because the vast majority of violation incidents never reach a court decision, the costs and fees provisions in the previous language would rarely come into play. This means that even if a landowner engaged in an egregious violation that necessitated exorbitant legal fees by the land trust, the latter would have no recourse to recoup those fees short of a formal court decision. Even minor violations can lead to hefty legal bills for the land trust. Twice in the past year I advised Maine land trusts on responding to timber harvest violations, and in both cases the matter was settled well before any court action was considered. But in both instances, the land trust incurred significant legal and consulting fees and essentially had to beg for reimbursement, even though the landowner freely admitted to the violation. The updated language in 10.B would provide the land trust greater leverage to recover its fees in this kind of scenario. I strongly encourage land trusts to use this updated language in their templates going forward. And the enhanced fee recovery language also benefits the original landowner long term, insofar as they want to see the perpetual protection of the property, and thus wouldn’t want a successor landowner to have any undue incentive to violate the easement.

• In Paragraph 11.B.2, we added language allowing for email and similar electronic communications between the landowner and holder, with certain safeguards in place. In recent years, I have seen an uptick in such methods of conveying notices and requests for approval, and MLCAN deemed it time to recognize the availability of such methods in the template.

• Finally, in Paragraph 11.C the template has always deemed the Holder’s failure to respond to a request for approval as a denial, and there is no change to that outcome. However, we have added some clarifying language, calling such failure a “constructive denial” and affirming that the Landowner can resubmit requests in the event of a constructive denial. Both before and after this recent edit, Paragraph 11.C meets the March 2021Land Trust Accreditation Commission requirement that approval provisions not allow lack of Holder’s response to Landowner’s request constitute an automatic approval of the activity. (Requirements Manual p. 19, sec. III.2.d).

Stay tuned for more changes to the template in the late fall or early winter, as we had to table a couple items that we hope to revisit at our next meeting.

Superior Court Vacates CMP Lease on Public Reserved Land

 A Maine Superior Court judge issued a strong ruling this past week vacating a lease granted from the State of Maine to Central Maine Power(CMP). The lease allowed for electric power transmission across Public Reserved Land to construct part of the New England Clean Energy Connect (NECEC) corridor. The ruling calls into question whether CMP has the right to complete the corridor without additional approvals from the Maine Legislature, which would be difficult to secure. An appeal to the Maine Supreme Court is likely, so we have not necessarily heard the last word on this issue. But if affirmed on appeal, this case will significantly bolster protections for State-owned conservation land.

Some background is necessary to understand this decision. The State of Maine owns approximately 600,000 acres of Public Reserved Land. A longstanding statute sets forth some basic rules for Public Reserved Land, requiring management plans geared toward “multiple uses,” including recreation, conservation, and sustainable forest management. A separate provision allowed the Bureau of Parks and Land (BPL) to execute certain “actions” if consistent with the management plans, including leases for electric power transmission, landing strips, and commercial and industrial purposes. In 1993, the Maine Legislature and citizens approved an amendment to the Maine Constitution that prohibited the acreage reduction or “substantially altered” use of state parks and other lands held for conservation and recreation purposes, except upon a two-thirds vote of each branch of the Legislature. After passage of the Constitutional amendment, the Legislature defined the term “substantially altered” to mean to “significantly alter its physical characteristics in a way that frustrates the essential purpose for which that land is held by the State.”

In connection with the NECEC project to connect hydroelectric dams in Quebec to consumers in Massachusetts, BPL executed a lease with CMP in 2014 and amended it in 2020.The lease allowed the construction of the transmission line across two parcels of Public Reserved Land. BPL did not make a determination as to whether the leases substantially altered the uses of the parcels, and did not submit the lease for legislative approval. Nor did BPL provide any notice to the public of its intentions to enter into the lease or make any contemporaneous written findings as to why it was not seeking legislative approval. In fact, the lease did not come to light until months or years after it was executed.

In2020, as NECEC was passing through a number of state and federal administrative approvals, state lawmakers filed suit against BPL, alleging that it failed to comply with the Constitution and the statute by not making a substantial use determination. By contrast, BPL took the position that the relevant statute established electric power transmission as one of the multiple uses for which the land was to be managed, and therefore that leases for such purposes did not “substantially alter” the uses of the properties.  

Ina March 2021 decision, the trial court granted pre-trial judgment to the plaintiffs on certain key issues, holding that electricity transmission was not one of the “multiple uses” for which the Public Reserve Land was to be managed. Instead, leases for such utility and other commercial and industrial purposes were “actions” that were subject to the Constitutional amendment and its implementing legislation. Furthermore, the court held, any ambiguity between the statutes and the Constitutional amendment must be resolved in favor of the Constitution.

The court’s latest ruling builds on the March 2021 decision. In particular, the court  found that BPL must make an explicit “substantial alteration” determination using the statutory definitions referenced above, and that any such determination must be made pursuant to a public administrative process conducted prior to any lease execution. Development of a management plan for the property, required by other statute, does not discharge this more specific determination requirement. BPL’s responsibilities are all the more sacred because it is acting as trustee of public trust lands. Moreover, any citizen has standing to challenge BPL’s finding of no substantial alteration. In contrast, BPL’s and CMP’s analysis would render the Constitutional amendment and implementing statute toothless. Because BPL fundamentally failed to fulfill its “substantial alteration” determination obligations, the 2020 lease was vacated for lack of proper authority.

 There are a number of moving parts to this controversy, and the ultimate impact of the Superior Court’s decision on the lease and the NECEC project in general are still to be determined. An appeal to the Maine Supreme Court seems likely, so stay tuned for more.

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Upcoming Event: Land Trust Alliance Rally Session - Federal Tax Law Latest and Greatest 2021

Date: Thursday, October 7, 12:30 – 2:00 pm
Location: Live Web Presentation

Sponsor:  Land Trust Alliance

Register and more information here

 As usual, there’s a lot going on in Congress, at the Tax Court and at the IRS that land trusts need to know about. Attorneys Rob Levin, Steve Small, and Jessica Jay will bring everyone up to speed on the latest developments over the past year.

E-Bulletin Information

I send E-Bulletins 3 or 4 times per year to provide updates and analyses on legal and policy matters respecting Maine land conservation.  I do my best to keep my messages brief, timely, and useful to conservation-minded landowners, as well as land trust professionals and volunteers.  At the same time, no one should rely on these E-Bulletins as legal advice, and I encourage you to consult a qualified attorney for advice on any particular situation.  

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