Conservation Covenants

A conservation covenant is one of the most powerful promises you can make.

 

It is a formal legal commitment to protect your land for nature that still allows you to own your property, live on your property, and sell it whenever you want.

 

The power of a conservation covenant is that it binds future owners to the same promises you made, meaning the land you’ve loved and cared for remains protected forever.

Lisa Baile in front of an old-growth tree on the land she protected with a conservation covenant
Landholder Lisa Baile in front of an old-growth tree on the land she protected with a conservation covenant.

How they work

A conservation covenant is a voluntary legal agreement between a landowner and a conservancy or land trust, which is registered on the land title.

The landowner promises to use and protect the land in certain ways and the conservation organization promises to regularly monitor the property to ensure that it remains protected forever. A conservation covenant is ‘held’ by an organization (like the Islands Trust Conservancy), which agrees to take on the perpetual responsibility to monitor and enforce the agreement.

A covenant binds all future owners of the land to the same terms you agree to. It creates a permanent sanctuary for the plants and animals you share the land with.

It can be placed on all or just some of your property, giving you the flexibility to continue to live on and even further develop the unprotected portion. It also allows you to own (and sell or bequeath) your property while still protecting the land.

Islands Trust Conservancy typically accepts covenant proposals that:

Additional benefits for you

  • Peace of mind: the land you care for will be protected, regardless of who may own the land in future. We monitor covenanted lands annually (at no cost to the landowners) and enforce the terms of the covenant when necessary.
  • Income tax benefits: if you register a covenant on property with significant ecological value, you may be eligible for income tax benefits through the federal Ecological Gifts Program.
  • Property tax benefits: if you register a covenant through the Islands Trust’s Natural Area Protection Tax Exemption Program (NAPTEP), you can receive an annual property tax exemption of 65% on the protected portion of the land. Read more below on the NAPTEP program and eligibility for conservation covenants.
  • A covenant’s restrictions often lower the property’s market value (by restricting future use) significantly enough that BC Assessment may lower your property’s assessed value thus reducing your property taxes owed each year.

If you are considering a conservation covenant, it is very important that you get independent legal and tax advice to ensure you are aware of all the implications for your personal financial situation.

Natural Area Protection Tax Exemption Program

The Natural Area Protection Tax Exemption Program (NAPTEP) is an additional financial incentive program unique to the Islands Trust region. It is meant to incentivize land protection actions by individual landholders.

Map of the Islands Trust Area
Map of the Islands Trust Area

When you register a conservation covenant through NAPTEP, you receive an annual property tax exemption of 65% on the protected portion of your land. This means you save money annually in exchange for protecting the natural areas on your land. These tax savings can add up quickly, depending on the size of the land you’re able to protect.

To qualify for a NAPTEP covenant, you must own land in the Islands Trust Area. The covenant area must also be at least 2ha (5 acres) in size.

While all natural areas are important, NAPTEP focuses on properties with specific natural values, including:

  • Sensitive ecosystems (including cliffs and coastal bluffs, wetlands and creeks, woodlands, old & mature forests)
  • Key habitats for rare or at-risk native plant species or plant communities (e.g. Coastal Douglas-fir, prairie meadow ecosystems, etc.)
  • Habitat critical to native wildlife for breeding, rearing, feeding or important life-stage activities (e.g. Heron rookeries, turtle nest sites, wetlands/ponds, etc.)
  • Special geological features (e.g. caves, springs, tombolos)

Costs to the landowner vary depending on the property and the complexity of the covenant. For NAPTEP covenants, property tax benefits begin the year following registration, if the covenant is finalized by October 31st.

Applying for a covenant

A landholder considering a conservation covenant with Islands Trust Conservancy submits a Conservation Proposal or NAPTEP Application Form (and NAPTEP Application Fee) for consideration by the Islands Trust Conservancy Board.

If the Board accepts the proposal to covenant your land, it typically takes from 6 months – 2 years to complete all of the steps required to negotiate and register the legal covenant. The process involves many steps including the negotiation of the covenant agreement, conducting a baseline report describing the property’s ecological features, legal review by all parties, and registration with the Land Titles Office.

Covenant FAQs

What is a conservation covenant?

A conservation covenant is a written legal agreement between a landowner and a conservation organization that sets out specific restrictions or requirements that the landowner will uphold to ensure conservation of the land or part of the land forever. Conservation covenants are permanent and run with the land, meaning they also bind future property owners.

What’s the difference between NAPTEP covenants and other conservation covenants?

All conservation covenants are formal legal agreements between a landowner and a qualified conservation organization.
A ‘NAPTEP’ covenant is a special type of conservation covenant agreement unique to the Islands Trust Conservancy. The Natural Area Protection Tax Exemption Program (NAPTEP) was created under the Islands Trust Act and provides an additional financial incentive to protect land in the Islands Trust Area. An Islands Trust Conservancy NAPTEP covenant provides you with an annual 65% property tax exemption for the portion of the property protected by the covenant.
Key differences for NAPTEP covenants include:

  • An application fee ($450, spread over two phases)
  • Following the ITC’s Board review of the initial conservation proposal from landowners successful NAPTEP applications are also reviewed by Islands Trust Council for entry into the tax exemption program. When a NAPTEP covenant is registered at the Land Titles Office, Trust Council issues a Natural Area Tax Exemption Certificate that is also registered on the property title.
  • While covenants can be a very flexible tool to meet landowner goals, covenants negotiated through the NAPTEP program are generally less flexible because they result in property tax exemptions that are prescribed by legislation.
  • Conservation covenants include financial penalties that can be imposed if the landowner does not follow the terms of the agreement —whether it is you or a future landowner. For NAPTEP covenants, the tax exemption certificate can be withdrawn and any previously exempted taxes will need to be repaid with interest.

Why would I place a conservation covenant on my land?

Every landowner has their own reason for considering a conservation covenant. These might include a desire to:

  • make sure the natural features on their property are protected forever
  • restrict the kinds or level of development that can happen on the property in the future
  • access the property and income tax benefits available to landowners who conserve lands using conservation covenants

Will I still own my land after placing a covenant on it?

Yes, you will simply be restricting the way you and future owners of your land can use the land.

Will a conservation covenant allow public access or use of my property?

A conservation covenant does not grant the public access or use of the property. However, if you want to grant access to the public, wording to this effect can be added to the covenant.

Does a conservation covenant have to cover my whole property?

No, in fact most people have covenants only on a portion of their land. Under NAPTEP, applicants must keep proposed development areas, houses and major buildings outside of the covenant area. Applicants should also try to keep their driveway, septic, well areas, and other improvements outside the covenant area.

I want to build on my property in the future. Can I still put a covenant on my property?

Yes, but we advise that you think carefully about the required setbacks and location of future septic, well, driveway, and garden areas, etc. You are advised to consult with Islands Trust planning staff regarding future development requirements.

Can there be buildings and roads on the area I want to protect?

Yes. However, because covenants are intended to protect natural, cultural and social values, the covenant area should be designed in a way that minimizes the number of buildings and roads in the area. If it is necessary to include an existing structure (driveway, dock, path, etc.) the covenant specifies that you are allowed to maintain these features; however, you will not be able to expand them.

Why are covenant documents so long?

A conservation covenant is a legal document that, if not upheld by the owner or future owners, may be enforced through the courts. The various sections and specific wording of the covenant are drafted to ensure that the intent and restrictions are clear and that it is enforceable. An interpretation of the legal covenant language is available in the NAPTEP Annotated Conservation Covenant.

How much will putting a conservation covenant on my land cost?

The landholder’s costs will vary depending on the size of the area to be protected and the complexity of the covenant. Estimated costs include:

  • A survey of the land (if the covenant is over only a portion of the land). Landowners can keep this cost low by choosing a simple design for their covenant area, such as using existing property lines or using long straight lines for the covenant area ($3,000 to $7,000+)
  • A baseline report that describes and maps the land at the time the covenant is registered (ecological features and any human features) ($2,500 to $5,000+)
  • Registration fees for the covenant ($400), plus notary or a lawyer to witness document signatures ($100+)
  • Your own legal advice on the terms of the covenant, and tax/financial advice ($500 to $3,000+)
  • An appraisal (typically only required if you’re entering the Ecological Gifts Program) ($4,000 to $7,000+)
  • NAPTEP Application fees ($450) – for NAPTEP applicants only

In some circumstances, the Islands Trust Conservancy can help you with the costs of protecting your land if financial hardship makes it impossible for you to cover these costs. Our funds available are limited and subject to change. Please discuss your situation with staff early in the process to determine what is available and what grants or other fundraising options may be available to you.

For example the Morrison Waxler Biodiversity Protection Legacy Fund offers grants to North & South Pender landowners to cover some of the costs with registering a conservation covenant or NAPTEP covenant.  To apply for the Morrison Waxler Biodiversity Legacy fund please contact us  at donate@islandstrust.bc.ca

If you partner with another local land trust or conservancy there may be additional grants they can apply for such as the Opportunity Fund or others as well.

Do I have to get legal and tax advice?

If you are considering a conservation covenant, it is very important that you get independent legal and tax advice to ensure you are aware of all the implications for your personal financial situation.

What’s the difference between NAPTEP covenants and other conservation covenants?

All conservation covenants are formal legal agreements between a landowner and a qualified conservation organization.
A ‘NAPTEP’ covenant is a special type of conservation covenant agreement unique to the Islands Trust Conservancy. The Natural Area Protection Tax Exemption Program (NAPTEP) was created under the Islands Trust Act and provides an additional financial incentive to protect land in the Islands Trust Area. An Islands Trust Conservancy NAPTEP covenant provides you with an annual 65% property tax exemption for the portion of the property protected by the covenant.
Key differences for NAPTEP convenants include:

  • An application fee ($450, spread over two phases)
  • NAPTEP applications are considered in public meetings, whereas most other covenants are kept confidential until they are registered.
  • Following the ITC’s Board review of the initial conservation proposal from landowners successful NAPTEP applications are also reviewed by Islands Trust Council for entry into the tax exemption program. When a NAPTEP covenant is registered at the Land Titles Office, Trust Council issues a Natural Area Tax Exemption Certificate that is also registered on the property title.
  • While covenants can be a very flexible tool to meet landowner goals, covenants negotiated through the NAPTEP program are generally less flexible because they result in property tax exemptions that are prescribed by legislation.
  • Conservation covenants include financial penalties that can be imposed if the landowner does not follow the terms of the agreement —whether it is you or a future landowner. For NAPTEP covenants, the tax exemption certificate can be withdrawn and any previously exempted taxes will need to be repaid with interest.

Who holds a NAPTEP conservation covenant?

A NAPTEP covenant must be held by the Islands Trust Conservancy. There may also be a covenant co‐ holder, such as a local conservancy.

If I enter the program how much money will I save?

Landowners with a NAPTEP covenant receive an annual 65% property tax exemption on the portion of their land protected by the covenant. Your property tax exemption through NAPTEP will depend on the assessed value of your property and the percentage of your property that you protect. To assist you in determining if NAPTEP is financially beneficial for your situation, the Applicant’s Guide to Calculating NAPTEP Costs and Benefits provides several scenarios comparing NAPTEP costs to property tax savings.

Will a NAPTEP covenant affect my property’s value?

Generally, conservation covenants lower the assessed value of a property because they restrict development and other landowner rights. For NAPTEP covenants, BC Assessment will continue to assess your property as though the covenant does not apply, but will apply a tax exemption to the assessed amount. The market value of your property may or may not change depending on various circumstances. All applicants are advised to get legal and financial advice.

Will the NAPTEP tax exemption affect the other tax exemptions I receive on my property?

To receive the tax exemption afforded by NAPTEP, BC Assessment reclassifies the land as Residential (Class 1). If you receive a tax exemption under a different classification (e.g. Class 7: Managed Forest Land, Class 9: Farm Land), you may lose that benefit by enrolling in the NAPTEP program.

Do I have to get legal and tax advice?

If you are considering a conservation covenant, it is very important that you get independent legal and tax advice to ensure you are aware of all the implications for your personal financial situation.

Registering a Conservation Covenant

To find out if a conservation covenant will help you achieve your vision for conservation or learn about the next steps for registering a covenant on your land, please review these helpful resources:

NAPTEP Brochure

VIEW (PDF 703 KB)

NAPTEP Application Form

VIEW (PDF 581 KB)

NAPTEP Annotated Conservation Covenant

VIEW (PDF 830 KB)

NAPTEP Applicant’s Guide to Calculating Cost Benefits

VIEW (PDF 1117 KB)

NAPTEP Income Tax Resources

VIEW (PDF 431 KB)

Conservation Proposal Form

VIEW (PDF 1280 KB)

I’m interested. How do I apply?

Read our step by step guide on how to apply for a conservation covenant with the Islands Trust Conservancy.

A conservation covenant can be individually tailored to you and your land. We’d love to talk to you about your vision for conservation and discuss options to help you meet that vision.

We recommend that anyone contemplating a conservation covenant also talk with independent financial and legal advisors. If your advisor is not familiar with covenants, we would be happy to provide additional information.

More Information

Ecosystems Protection Specialist

E: ecosystems@islandstrust.bc.ca

T: 1-250-405-5176