Land trusts find foothold in Indiana

TIPTON COUNTY–A short walk from trees twice as old as Indiana and just past a house built for $1,500 in 1938, a cabin made
of fallen timbers stands next to a tiny pond.

Terry and Gale Sherwood built it a few years back and stay here when the weather's nice, listening to birds while they
play Scrabble or Scattergories.

The couple grew up here, along a country road north of Atlanta, and they know just about every inch of their 114-acre spread,
including the mature woods, wetlands, meadows and cropland.

In an effort to keep the land as it is now, the Sherwoods are transferring development rights for the property to Central
Indiana Land Trust Inc., a not-for-profit environmental group. They are among the first property owners in central Indiana
to grant a so-called conservation easement in exchange for an impressive array of tax benefits.

Their motivation was protecting the land from future development, logging or more-intense farming while allowing their daughters
to enjoy it as they have.

"We know our girls wouldn't harm the land," said Gale Sherwood, 49. "But you never know who they'd
marry."

Conservation easements such as the Sherwoods' have become one of the most popular methods of land preservation nationwide,
but have been slower to catch on in Indiana. Central Indiana Land Trust and other such groups hope to change that.

The Land Trust has set a goal to protect another 2,010 acres in central Indiana by 2010, about half through conservation
easements, said Executive Director Heather Bacher. The group now has conservation easements in place or in the works for about
200 acres; it also has helped protect another 2,400 acres and owns about 800 acres outright.

Easements don't change the ownership of a property, but owners donate–or, in rare cases, sell–development rights to
conservation groups. To qualify, the land must meet certain criteria, such as providing a habitat for plants or animals, protecting
air and water quality, or providing access to nature. Easements don't require public access.

The loss of development rights typically eliminates 60 percent to 80 percent of a property's value, an amount that can
be deducted from income taxes and substantially lowers inheritance taxes.

And the incentives to property owners recently got even sweeter. Last year, Congress raised charitable-deduction limits from
30 percent of adjusted gross income to 50 percent for those who donate conservation easements. Farmers and ranchers can deduct
up to 100 percent of their annual income. The change also allows the full deduction to be spread out over 15 years, instead
of five.

Conservation groups are racing to capitalize on the shift in case lawmakers do not renew the measure by the end of 2007.

"If we don't do it now, we're going to lose the opportunity," Bacher said.

Nationwide, there are 1,600 not-for-profit land trusts with more than 37 million acres under protection, according to The
Land Trust Alliance, a national not-for-profit that coordinates the efforts of land trusts. Between 2000 and 2005, the amount
of land protected by easements doubled to 6.2 million acres.

The land trusts don't have the resources to compete with developers, but that's not the goal.

"We're not tying ourselves to trees," said Maria Steiner, who does community outreach for the Central Indiana
Land Trust. "We're quietly protecting the land, doing what we can."

The message of land trusts is that there are more choices than simply selling property to a developer or doing nothing, said
Stephen J. Small, a Boston attorney and a leading expert on private-land protection who literally wrote the IRS rules on conservation
easements.

Depending on how the easement is worded, the donated land can be used for farming or ranching or just as a nature preserve.
The bottom line: It won't become a shopping mall or subdivision.

"This whole thing starts with love of the land," Small said. "You wouldn't be interested in doing something
like this if you didn't care about your land. And with the tax savings you get for doing it, it's a great deal."

The Sherwood farm may seem remote, but there are threats to its preservation. Thanks to ethanol, the price of corn is up
and farmers are eager to cultivate acres that once were wooded. A new Getrag transmission plant is in the works nearby. And
every so often, the Sherwoods get offers for their ancient walnut and ash trees.

They're excited about preserving the trees and making sure their Airedale terriers, Harley and Goober, have room to roam.
And they're happy a healthy patch of Fire Pink wildflowers won't disappear like the Bobwhite quail, which they haven't
seen on the property since the 1978 blizzard.

The Sherwoods learned about conservation easements from Gale's sister, a biology teacher, and say the tax savings are
secondary to preservation. It's the least they could do to continue the legacy of the former neighbor who gave them much
of the land: Bonnie Shrock, a nature lover who lived in the old house.

Terry Sherwood, 64, said Shrock had a stock answer for anyone who offered to buy her trees for timber: "Who wants to
look at a stump the rest of their lives?"