Doing WRP on our property

[tica-tica]

Property is in North Alabama. I put the app in and they are doing the soil tests, appraisal, etc. now. Any suggestions/comments before we sign on the line? Do you like the 30yr or the permanent easement?

[Don Miller]

DON'T DO IT! If you can afford to keep the property without the government getting involved, you are a lot better off. No way in hell would I give the government an easement on any of my property.

[Don Miller]

Ooops! double post

[JaMak84]

I don't know what the prices are like in Alabama, but I know here in Mississippi they suck. I'd check into CRP and compare the money. You can build dikes and water control structures for waterfowl management with CRP as well and receive cost-share assistance on those practices. The cost share for those structures on CRP should be close to the same as the cost share on a 30 year WRP easement. The only draw back to CRP vs WRP is that you can't plant anything in the waterfowl areas on CRP, they are shallow water management only. I work for NRCS and if I had my own property and could afford to pay the cost share on the restoration I would go with CRP. If you can't afford the restoration costs, then a perpetual easement might be the right thing for you. Just remember, on a perpetual WRP easement you only retain 5 rights FOREVER; CRP is only a 15 year contract.

[Double R 2]

If you decide to go through with it, y'all might consider ommitting some of your current impoundments or annually flooded agricultural areas from the program.

[tica-tica]

It's in Madison co. near Huntsville so we are expecting $3200 to $3500 per acre on the appraisal. I agree with taking some out to plant as we like. Do yall think the WRP hurts the resale? This property is only 48 acres and is attractive for recreation. I would imagine some large tract in WRP might limit resale opportunities but I dunno.

[Double R 2]

It's in Madison co. near Huntsville so we are expecting $3200 to $3500 per acre on the appraisal. I agree with taking some out top plant as we like. Do yall think the WRP hurts the resale? This property is only 48 acres and is attractive for recreation. I would imagine some large tract in WRP might limit resale opportunities but I dunno.

I don't think it neccesarily hunts the resale. But I can tell you that if you have been seduced by the WRP $'s, y'all need also to look at also placing the property into a conservation easement and receiving some major "charitable donation" benefits.

[JaMak84]

It's in Madison co. near Huntsville so we are expecting $3200 to $3500 per acre on the appraisal. I agree with taking some out top plant as we like. Do yall think the WRP hurts the resale? This property is only 48 acres and is attractive for recreation. I would imagine some large tract in WRP might limit resale opportunities but I dunno.

I don't know how the appraisal system works in Alabama, but I'm pretty sure you're going to be very disappointed with the amount of money they offer you for your property. The most we've offered anybody in the last two years over here is about $350/acre. The way I understand the system, they have determined(whether or not this is actually true I don't know) that WRP reduces property value. Say your property appraises for $3500/acre before the easement, and they assume that with the easement the property will appraise for $3200/acre. What they will offer you is the difference of $300/acre. There is also a maximum per acre value as well. Here in Mississippi the maximum is $900/acre, I don't have any idea what Alabama's is.

[tica-tica]

It's in Madison co. near Huntsville so we are expecting $3200 to $3500 per acre on the appraisal. I agree with taking some out top plant as we like. Do yall think the WRP hurts the resale? This property is only 48 acres and is attractive for recreation. I would imagine some large tract in WRP might limit resale opportunities but I dunno.

I don't know how the appraisal system works in Alabama, but I'm pretty sure you're going to be very disappointed with the amount of money they offer you for your property. The most we've offered anybody in the last two years over here is about $350/acre. The way I understand the system, they have determined(whether or not this is actually true I don't know) that WRP reduces property value. Say your property appraises for $3500/acre before the easement, and they assume that with the easement the property will appraise for $3200/acre. What they will offer you is the difference of $300/acre. There is also a maximum per acre value as well. Here in Mississippi the maximum is $900/acre, I don't have any idea what Alabama's is.

They explained to me that WRP pays 50% of the appraised value of the property. It is a one time payment. You get 100% of the 50% on a permanent easement and 75% of the 50% on a 30 yr. easement. Was also told you can do a ‘1031 Exchange’ which lets you roll the WRP money into another property and avoid all tax liability.

RR, tell me more about this "placing the property into a conservation easement and receiving some major "charitable donation" benefits." Are you talking about a CRP to get a yearly payment?

[Double R 2]

Here's a few links that explain it far better than myself (and, most importantly, with a lot less typing on my part).

I do baseline documentation reports. The ecomomic benfit derived is nothing short of astounding - especially since the property is already in the perpetual wetland reserve program (which has been the case in about 80% the baseline reports I've written. IF the property is already in some form of perpetual easement that already precludes development, or IF for whatever reason the landowner is absolutely certain that current land useage is desired forever, it's pretty much a no brainer. Of course, program benefits are presently tied up in the pending Farm Bill. Mississippi River Land Trust, Ducks Unlimited, Nature Conservancy and Delta Land Trust are a few organizations I know that do conservation easements.

http://www.wildlifemiss.org/financial/easements/index.html

http://www.outdooralabama.com/hunting/articles/easements.cfm

[Wingman]

Anyone have the scoop on the CRP thing on existing fish ponds? I heard it was about to happen, but don't have the details.

[tica-tica]

Here's a few links that explain it far better than myself (and, most importantly, with a lot less typing on my part).

I do baseline documentation reports. The ecomomic benfit derived is nothing short of astounding - especially since the property is already in the perpetual wetland reserve program (which has been the case in about 80% the baseline reports I've written. IF the property is already in some form of perpetual easement that already precludes development, or IF for whatever reason the landowner is absolutely certain that current land useage is desired forever, it's pretty much a no brainer. Of course, program benefits are presently tied up in the pending Farm Bill. Mississippi River Land Trust, Ducks Unlimited, Nature Conservancy and Delta Land Trust are a few organizations I know that do conservation easements.

http://www.wildlifemiss.org/financial/easements/index.html

http://www.outdooralabama.com/hunting/articles/easements.cfm

Thanks for the info RR. I looked into gov easements years ago but we never did anything. We built dikes and water control structures without any assistance. They said our initial work meets the gov standard for the easement. They want to do a little panning to put more water on the place but that is about it.

Are you saying that you can do a conservation easement in conjunction with the WRP easement. Double dipping sounds neat.

[Double R 2]

Are you saying that you can do a conservation easement in conjunction with the WRP easement. Double dipping sounds neat.

Depending on pending Farm Bill language. The answer back before last October or so was yes. It's not really double dipping, though, if for no other reason you're dealing with seperate governmental entities.

The way the conservation easement works is that the difference in appraised before-after values is treated as a charitable donation. If the appraiser says the wrp tract is worth 1,250,000 before the conservation easement and only 1,000,000 afterwards, you get a quarter-million dollar charitable contribution that may be amortized towards your federal tax return for 5 years if neccesary. It's not for everyone, though. It takes a real close look. Say there are 10 members and the appraisal cost $20,000, the baseline assesment cost about $4,500 and fee to the land trust is $10,000. That's $3400 up front each member must pay to each receive about $25,000 federal income tax deduction. Assuming you can itemize that much single year, and you're in about a 30% tax bracket, that equates to about $7500 real money left in your pocket. Is it worth it? To me, yes, double money. But what about the members that don't itemize, or members in a lesser tax bracket? It's worth taking a hard look at because if y'all put it in a perpetual wetland easement, it's locked in forever anyway. I've seen one 30 year wrp easement ever, and the land owner didn't even know or remember that it was a 30 year easement.

[JaMak84]

Anyone have the scoop on the CRP thing on existing fish ponds? I heard it was about to happen, but don't have the details.

Sadly, the public will know about this before we do. I've heard a little talk about it but nothing for sure.

[Double R 2]

Conservation easements (after the President Vetoes the Farm Bill and Congress over rides the Veto) - looks a 2 year extension granted for conservation easements: 50% adjusted income deductible and amortize over 15 years. IF 51% of your income derived from agriculture (including forestry), can deduct 100% of ag income.