For illustrative purposes, assume you are the owner of a ranch and would like to donate a conservation easement on the property. Working with MLR staff, you negotiate the terms of the easement, which allows continued agricultural use and protects scenic open space and important fish and wildlife habitat. The easement may allow for construction of additional residences, and precludes commercial development, subdivision, surface mining, and any waste dumping.
A certified real estate appraiser qualified under the Uniform Standards of Professional Appraisal Practice (USPAP) determines the value of the easement, measured as the difference between the value of the property with and without the easement in place. The appraiser will consider data on comparable properties to arrive at the market value of the property after the conservation easement is in place. The difference between the beforehand and after values becomes the value of the easement, and the amount of the charitable contribution.