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ACEP-ALE for Entities

Welcome. Learn how to successfully participate in the Agricultural Land Easement component of the Agricultural Conservation Easement Program. Our fact sheets, videos, annotated checklists, and more will walk you through each phase of the process.
Learn About ACEP-ALE
  • Learn About ACEP-ALE
  • Prepare to Participate
  • Apply to ACEP-ALE
  • Prepare to Acquire
  • Steward the Easement
Jump to Section
1. Learn About Agricultural Conservation Easements
2. Explore How ACEP-ALE Works
3. Get to Know NRCS
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Learn About ACEP-ALE

The Agricultural Conservation Easement Program – Agricultural Land Easement component (ACEP-ALE) is a voluntary federal conservation program implemented by the USDA Natural Resources Conservation Service (NRCS) that protects agricultural land from conversion to non-agricultural uses. ACEP-ALE provides matching funds to eligible entities to acquire conservation easements on farm and ranch land.

Learn About Agricultural Conservation Easements

A conservation easement is a deed restriction used to protect natural resources on land. An agricultural conservation easement makes land available for agricultural uses, which may keep land affordable and support land access and succession. A conservation easement may also provide potential tax benefits to landowners. Agricultural conservation easements limit what can be built on the property and where structures can be located, limit non-agricultural development, subdivision and other uses that are inconsistent with agriculture.

READ
  1. Agricultural Conservation Easements Fact Sheet

Explore How ACEP-ALE Works

The Agricultural Conservation Easement Program (ACEP) provides technical and financial assistance to protect farm and ranch lands and conserve grasslands and wetlands. Under the Agricultural Land Easement (ALE) component of ACEP, NRCS provides matching funds to eligible entities, state and local governments, non-governmental organizations, and Indian tribes to acquire agricultural conservation easements on working agricultural lands.

NRCS sets minimum criteria that all land, landowners, and entities must meet in order to qualify for program participation. They process and rank the applications which are submitted by entities. The number of applications submitted varies from state to state. Contacting your state NRCS program manager can give a sense of how competitive applications have been in the past.

Once the easement transaction has closed, the entity maintains responsibility for stewarding the land in perpetuity according to terms in the agreement. Additionally, NRCS maintains a right of enforcement throughout the life of the easement.

Consider your organization’s capacity to handle these responsibilities before deciding to participate. Review the following pages to learn about eligibility criteria, applying for ACEP-ALE participation, and holding an agricultural conservation easement.

READ
  1. ACEP-ALE Overview for Entities
  2. NRCS ACEP Fact Sheet

Get to Know NRCS

NRCS is a federal agency within the U.S. Department of Agriculture. NRCS works with farmers and landowners to help improve agricultural productivity and protect natural resources through conservation programs and technical assistance.

The agency has a state office in each state and local service centers in most counties throughout the U.S. Some local service centers serve more than one county. 

As you proceed through the ACEP-ALE application process, NRCS field staff in local service centers can help answer questions about using the Web Soil Survey and understanding the soils and land uses of potential easement land. This will be relevant when determining the land’s eligibility. Field staff can also assist with connecting your entity and the landowners you work with to the USDA Farm Service Agency (FSA) to complete forms required for eligibility.

NRCS field staff may administer several programs simultaneously, and while ACEP-ALE administration may not be their primary task, they are a good general resource for conservation programs and processes.

The ACEP-ALE program manager, typically located in the NRCS state office, can answer any program-related questions you may have. Each state has ranking criteria, application deadlines, and funding opportunities. Contacting your state program manager will help you understand how ACEP-ALE is administered in your state. Staff capacity may be limited in some states. Call the program manager to set up a time to ask specific ACEP-ALE questions.

WATCH
  1. An Introduction to USDA NRCS
  2. Programs and Services at NRCS
USE
  1. USDA Service Center Locator 
  2. NRCS State Office Websites
  3. NRCS ACEP-ALE State Program Manager Contact List
Jump to Section
1. Determine Your Eligibility
2. Screen Potential Projects
3. Choose a Transaction Type
4. Determine Your Landowner’s Eligibility
5. Review Land Eligibility Criteria
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Prepare to Participate

Before taking steps to apply for ACEP-ALE funding, you will need to verify whether your entity meets the minimum eligibility criteria that are set by law, as well as the type of ACEP-ALE transaction.

Determine Your Eligibility

To determine whether your organization is eligible, refer to the list of minimum criteria below and use our checklist. If you still have questions about your eligibility, your state’s ACEP-ALE program manager can assist you and help determine what documentation is needed to establish eligibility.

To be eligible to engage in a BPS transaction, your organization must meet entity, land, and landowner eligibility criteria for standard ALE transactions and meet the additional criteria for BPS transactions.

If another organization is co-holding an easement with you or acting as a 3rd party right holder, they do not need to separately establish eligibility unless they are also applying separately as an eligible entity, or will be an interim easement holder in a post-closing BPS transaction.

Each of the following criteria must be satisfied:

  • Be an agency of a state or local government (can include a farmland protection board or land resource council established under state law), though this entity would not be eligible to undertake BPS transactions; an Indian Tribe; or a non-profit nongovernmental organization
  • Be organized for the purpose of land preservation (can include recreation, natural habitat, open space, farmland, forest land, and/or historically important land)
  • Have authority to purchase and hold agricultural conservation easements
  • Have an established agricultural land protection program that purchases conservation easements
  • Have demonstrated a commitment to the long-term conservation of agricultural lands
  • Have the capability to acquire, manage, and enforce easements
  • Have staff dedicated to stewardship and monitoring
  • Satisfy non-Federal share requirements

You will also need a DUNS number and have an updated System for Award Management (SAM) registration. The DUNS number is a 9-digit identifier that is issued and maintained for free by Dun and Bradstreet. This number verifies the existence of a business entity and is a prerequisite for registration in SAM.

USE
  1. Entity Eligibility Checklist
  2. How to Get a DUNS Number and Register with SAM
  3. SAM Registration Webinar

Screen Potential Projects

Before you invest a lot of time:

  • Find out if the landowner is comfortable working with a federal agency. Landowners will need to disclose personal information to USDA in order to participate in the program.
  • Ensure the landowner is willing to live with a permanent restriction on their property.
  • Determine whether the parcel includes productive agricultural land. The majority of parcels qualify for the ALE program based on this category. The land must contain at least 50% prime, unique, statewide, or locally important agricultural soils. Generally, the higher the percentage of important soils, the better a project will rank. If your site does not meet the soils criteria, there are other options for qualifying, but be sure to check with state ranking criteria first.

If a project passes your initial screening, you can decide on a transaction type and spend more time confirming landowner and land eligibility.

Choose a Transaction Type

There are two types of ACEP-ALE transactions:

  • A standard ALE transaction occurs when the eligible entity has a written pending offer to purchase the agricultural land easement (ALE) on eligible land from an eligible landowner (or future landowner who has a current written purchase agreement for the parcel). This is the most widely used transaction.
  • A buy-protect-sell (BPS) transaction occurs when NRCS enters into an agreement with an eligible entity to provide cost-share assistance for the purchase of an ALE on eligible land that is owned or being purchased by the eligible entity on a transitional basis. The transaction’s purpose is to secure the long-term protection of the land and ensures timely transfer of the land ownership to a qualified farmer or rancher.
READ
  1. ACEP-ALE Buy-Protect-Sell Fact Sheet

Determine Your Landowner’s Eligibility

Confirm Ownership of Land

It is important to identify all landowners at the beginning of the process to avoid delays and complications later. You can take these steps to confirm the ownership of the parcel:

  • Review a copy of the property deed.
  • Request an initial title search to confirm that the deed provided by the landowner is the most recent and accurate and covers all portions of the proposed offered area.

For buy-protect-sell (BPS) transactions, the timing of the transfer of ownership determines who the landowner is for the purposes of ACEP-ALE participation. For a pre-closing transfer, the landowner is the qualified farmer or rancher, identified by the entity, who ultimately will own the land prior to or at the ALE closing. For a post-closing transfer, the landowner is the BPS-eligible entity or the interim landowner identified to help facilitate the land transfer, depending on who will be the landowner during the ALE closing. For more information, see the BPS fact sheet listed below.

Coordinate Completion of USDA Eligibility Forms

All individuals, legal entities, and entity members of record need to complete paperwork with USDA Farm Service Agency (FSA) to determine eligibility, including adjusted gross income (AGI) and conservation compliance. A Subsidiary Print is the resulting report that summarizes key eligibility information. Each landowner must independently qualify. You should oversee this process. Set up an appointment with FSA to ensure each landowner completes the required eligibility forms.

This documentation should be completed as soon as possible. You could initiate this process as early as the start of the new federal fiscal year (October 1). You do not need to wait for an announcement of ACEP-ALE application cycles to certify landowner eligibility. Once the landowners have filed the necessary documentation with FSA, it is suggested to contact FSA periodically to ensure it is being processed. You will need to obtain permission from the landowners to speak with FSA on their behalf.

To help assess whether a landowner is eligible to participate, use our Landowner Eligibility Checklist below.

READ
  1. FSA AGI Fact Sheet
  2. USDA Conservation Compliance Fact Sheet
  3. Example Landowner Subsidiary Print
  4. ACEP-ALE Buy-Protect-Sell Fact Sheet
USE
  1. Landowner Eligibility Checklist 
  2. FSA Payment Eligibility Page

Review Land Eligibility Criteria

After the initial screening, work with your landowner to confirm that the land meets all of the applicable land eligibility criteria:

  • Be privately owned or tribal agricultural land on a farm or ranch;
  • Fits into one of the four eligibility categories listed below when applying:
    • Contains at least 50% prime, unique, or other productive soil,
    • Contains historical or archaeological resources,
    • Protects grazing uses and related conservation values, or
    • Furthers a state or local government policy consistent with the purposes of ACEP. You will need to cite the relevant policy if you choose this option. Contact your state program manager to determine if this eligibility criteria is available in your state.
  • Be identified as cropland, pastureland, rangeland, grassland or other grazing land, and/or nonindustrial private forest land that contributes to the economic viability of the parcel or serves as a buffer from development; and
  • Be subject to a written pending offer from an eligible entity to purchase agricultural land (standard ALE transaction), or be subject to a buy-protect-sell transaction in which the land is owned by or in the process of being purchased by the BPS-eligible entity on a transitional basis and subject to certain conditions necessitating transitional ownership.

The following two items are listed as eligibility criteria in the ACEP-ALE program manual. In practice, NRCS will not consider projects to be ineligible based on these factors. These factors are considered in ranking. Be prepared to provide evidence of these factors at the time of application to make your project more competitive.

  • Have access to markets, infrastructure, and other agricultural support services; and
  • Be experiencing development pressure.

In addition, there are a few factors that make land ineligible, including: encumbrances with similar protections as ALE, unacceptable exceptions to clear title, adverse on or offsite conditions, and more. To learn more about land eligibility criteria, use the below Land Eligibility Checklist.

Understand Ranking Criteria

Applications are ranked by NRCS. NRCS staff from your state will conduct onsite visits and rank eligible parcel applications. National criteria make up at least half of the total score; state criteria may account for up to half. The State Conservationist with input from the State Technical Committee, however, may decide to give more weight to the national ranking factors. The national criteria consider the proportion of important agricultural land and active agricultural uses; the extent to which the parcel’s surroundings support agriculture and indicate development pressure; and whether the land contains significant grasslands.

As a result, ranking criteria are unique to each state and are updated each fiscal year. Changes must occur at least 30 days prior to an announced application cutoff date and the criteria must be posted on the state NRCS web page. Each state’s ranking criteria can be found by visiting the appropriate state NRCS web page. Using the “List of NRCS State Offices” link below, select your state and navigate to “Programs”, “Easements”, then “ACEP-ALE”.

Assess Parcel Configuration

Walk the property with the landowner and explore their personal and business goals. Discuss possible locations of exclusions for future building lots or commercial activity, or future farm enterprises. Take note of certain features of the property that could potentially impact ALE participation, such as access, infrastructure, abutting properties, and anything else that will help you and NRCS assess onsite and offsite conditions.

Now that you are thoroughly acquainted with the parcel, it is time to explore parcel configurations. As you consider possible easement area configurations, think about:

  • Land eligibility criteria
  • Ranking criteria
  • Landowner goals
  • Entity goals
  • ACEP-ALE minimum deed terms

Prepare a few different examples and walk through them with the landowner.

The configuration of the acres that are proposed for enrollment will impact the land’s eligibility and ranking. If the proposed easement boundaries are different than the property boundaries, the landowner may need to procure a survey. 

Discuss Easement Deed Terms

It is important to talk with your landowner about the ACEP-ALE minimum deed terms and your entity’s deed terms prior to applying for participation. ACEP-ALE minimum deed terms are mandatory. It is very difficult to modify or revoke an ACEP-ALE easement once it is on the land. Therefore, be sure that your organization and the landowner fully understand and agree to these terms prior to participating in this program.

Be aware that ALE deeds must include provisions that protect the attributes for which a parcel was ranked and selected for funding by NRCS. As a result, if a parcel’s ranking includes, for example, the commitment to protect pastureland that contains special wildlife habitat, the deed terms will enforce that commitment.

READ
  1. ACEP-ALE Fact Sheet
  2. ACEP-ALE Program Manual, Sections 528.33-34, 528.40-41, and 528.60-61
  3. ACEP-ALE Minimum Deed Terms
  4. Designating Farmland of Local Importance in Massachusetts Fact Sheet
WATCH
  1. How to Use the Web Soil Survey
USE
  1. Land Eligibility Checklist
  2. Web Soil Survey
  3. List of NRCS State Offices to Access State Ranking Criteria
Jump to Section
1. Learn About Funding Availability for ACEP-ALE
2. Gather Supporting Documentation
3. Access Application Forms
4. Complete Your Application Forms
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Apply to ACEP-ALE

Learn About Funding Availability for ACEP-ALE

Each fiscal year, NRCS issues a national bulletin to provide guidance on ACEP-ALE implementation. It includes vital information for NRCS staff about application review and selection, submitting agreements, internal review, and suggests dates for the current year’s application process. The guidance may also update standard forms, agreements, and deed term provisions.

States cannot begin processing or funding new applications until this guidance is issued. The release date for the fiscal year guidance varies based on a number of factors, including whether there are new Farm Bill provisions or federal budgetary discussions. 

After the guidance is released, NRCS state offices post information about the new application cycle. States are required to set the application deadline at least 30 days after the issuance of guidance. You can find the web pages for your state office using the “List of NRCS State Offices” link below. Select your state and navigate to “Programs”, “Easements”, then “ACEP-ALE”. If information is not available or out of date, contact the state program manager.

USE
  1. List of NRCS State Offices 
  2. NRCS ACEP-ALE State Program Manager Contact List

Gather Supporting Documentation

NRCS makes determinations about eligibility and ranking based on the documentation you supply. They may verify some information with an on-site visit. Use the below checklists as guides and suggestions for gathering the documentation that will be needed to apply for ACEP-ALE. Refer to these lists early, as they will give you an idea of what to expect in the application process.

USE
  1. Entity Eligibility Checklist
  2. Landowner Eligibility Checklist
  3. Land Eligibility Checklist 

Access Application Forms

ACEP-ALE applications are comprised of two separate forms to be completed by eligible entities – one to establish an Agreement (NRCS-CPA-41) and another to fund a Parcel Contract (NRCS-CPA-41A) associated with the Agreement. For a buy-protect-sell (BPS) parcel, an additional form NRCS-CPA-41A BPS Supplement is also required.

First, be sure you are using the latest forms, as older forms may still be available in various places online. The latest forms are available at eForms.gov. You can complete the forms online and submit the forms electronically by registering for a USDA Customer ID. Visit eForms.gov for more information. You may also download fillable forms using the “Browse Forms” feature and submit them directly to your state program manager. Downloadable copies of the forms may also be posted on your state’s NRCS webpage.

When browsing for a form, keep searches as simple as possible. If you know the number of the form, such as NRCS-CPA-41, it helps to enter only the number 41 into the “Form Number” field without using the above filters. Avoid using punctuation or additional words, as search results will be too narrow and the form you are looking for may not appear.

If you see an error message instructing you to install Adobe Reader and configure viewing, refer to the “eForms Browser Instructions” document below. Be aware that not all USDA forms allow you to save information you type into them. Refer to these instructions for more information.

USE
  1. USDA eForms Website
  2. ACEP-ALE Application Forms
  3. eForms Browser Instructions

Complete Your Application Forms

The first form to be submitted is referred to as the Entity Application (CPA-41), which can be submitted at any time, with or without the second form for individual parcels. The CPA-41 covers entity eligibility and identifies other partners that are expected to be involved in upcoming projects as co-holders or 3rd party right holders. Specific easement information is not captured by this form. If the Entity Application is approved, your organization enters into a program agreement with NRCS. This program agreement is in effect for 5 years.

A Parcel Sheet (CPA-41A) is required for each ACEP-ALE parcel. The CPA-41A gathers information about the proposed easement land and the funding requested. Multiple parcels can be associated with a program agreement for standard ALE transactions. For BPS transactions, only one associated parcel sheet is allowed per program agreement and an additional form CPA-41A BPS Supplement is also required. Parcel applications can be submitted simultaneously with an Entity Application or after you have a program agreement with NRCS. You should submit these forms together or within a short period of time in order to be considered for funding. Funding decisions will only be made once CPA-41A forms are submitted with supporting documentation. If a parcel is selected, your organization will enter into a contract with NRCS for funding and proceed through the acquisition process.

USE
  1. Instructions for CPA-41 and CPA-41A
Jump to Section
1. Execute NRCS Agreement and Parcel Contracts
2. Develop your Deed
3. Procure an Appraisal
4. Secure Clear Title
5. Produce Your Plans
6. Prepare a Baseline Document Report
7. Finalize Documents and Reaffirm Funding
8. Complete the Transaction
9. Promote the Project
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Prepare to Acquire

Thanks for visiting this page! Please note that it is still in process. Check back soon for a complete set of resources.

Now that you submitted an ACEP-ALE application, what comes next? Your organization will coordinate with the landowner and NRCS to manage the acquisition process through closing. Timing and coordination of the acquisition process varies from state to state so be sure to check with your state’s program manager. See below for key steps leading up to the ALE closing for non-certified entities.

Each funded parcel must pass through NRCS’s internal review process before the project can close and payments can be issued. Most documents are due at least 90 days before the planned closing date. It is a good idea to complete these steps sooner so there is time to resolve any issues that come up in the review process.

Execute NRCS Agreement and Parcel Contracts

NRCS will notify your organization that your project was selected for funding in a given fiscal year. Based on the information in your application and parcel sheet, NRCS will prepare a Program Agreement and Parcel Cost-Share Contract (Parcel Contract). These documents will identify specific NRCS requirements, products, and timelines for acquisition activities.

Program Agreement

NRCS will prepare the Program Agreement for you to review and sign, and NRCS will sign it last. The Program Agreement expires five fiscal years after the fiscal year the agreement was executed. Applications for individual parcels can be funded at any time over the life of a Program Agreement. Program Agreements establish roles and responsibilities for the lead eligible entity and all potential partners who may co-hold an ALE or serve as a third-party right holder. The agreement can be amended to add parties but cannot be amended to remove eligible entities. NRCS will provide additional exhibits, which are listed on the last page of the agreement. You may need to submit additional exhibits, like rules for parcel substitution, a minimum deed terms addendum, or NHQ-approved deed template.

Parcel Contract

NRCS will prepare the Parcel Contract for you to review and sign (Form NRCS-CPA-1265). NRCS will execute this contract last. This is when the clock starts for acquiring an easement. In general, ALEs must close within three years as specified on Parcel Contract page 1. Prior to expiration of a Parcel Contract, a modification may be executed to extend the expiration date for a period of 12 months from the previous expiration date. A maximum of two 12-month extensions may be approved, though no Parcel Contract may be extended beyond March 31 of the fifth fiscal year following the original fiscal year of the Parcel Contract.

The Parcel Contract identifies the lead eligible entity, any other eligible entities, and the amounts to be paid to each for the acquisition of an ALE. Form NRCS-CPA-1265-Appendix identifies additional terms and conditions for the contract. Form NRCS-CPA-1266 Schedule of Acquisition for Easements identifies how the deed terms and HEL plan components (if applicable) will be incorporated and verifies easement costs, entity roles, and landowner information. If you need to make changes to the Parcel Contract, including extensions, use form NRCS-CPA-1267 Modification of the Schedule of Acquisition for Easements. NRCS will provide additional documents (NRCS-CPA-230E, -230F, and -1268) that you will use later in the acquisition process.

USE

Parcel Contract Forms

  1. Form NRCS-CPA-1265, ACEP-ALE Parcel Cost-Share Contract
  2. Form NRCS-CPA-1265-Appendix, Appendix to the ACEP-ALE Parcel Cost-Share Contract
  3. Form NRCS-CPA-1266, Schedule of Acquisition for Easements
  4. Form NRCS-CPA-1267, Modification of the Schedule of Acquisition for Easements

Develop your Deed

Upon execution of a Parcel Contract, your organization selected one of the following three options for ensuring the agricultural land easement deed contains the ACEP-ALE Minimum Deed Terms:

  • Attach the ALE Minimum Deed Terms addendum as an exhibit to the agricultural land easement deed
  • Incorporate the ALE Minimum Deed Terms into the body of the agricultural land easement deed
  • Have your organization’s agricultural land easement deed template approved by NRCS

The level of NRCS review and type of approval required for individual easement deeds prior to closing is based on how your organization elects to include the ALE minimum deed terms.

You must ensure the conservation easement language is compatible with the ACEP-ALE Minimum Deed Terms (MDT). It is okay to be more restrictive than the MDT. Whichever deed option you selected, submit the draft deed to NRCS for approval at least 90 days before the planned closing of the agricultural land easement. The state easement staff will conduct a deed review and then submit to the Easements Program Division (EPD) for approval, if required. If you decide to use a different option for the ALE deed than the option you originally selected, request a modification to your parcel contract on Form NRCS-CPA-1267.

List Impervious Surface Limit

The Minimum Deed Terms do not allow impervious surfaces to exceed 2 percent of the easement area without a written waiver from NRCS. You will need to provide the allowed impervious surface limit for this project in the ALE deed. Impervious surfaces are defined as material that does not allow water to percolate into the soil, including buildings with or without flooring, paved areas, and any other surfaces that are covered by asphalt, concrete, or roofs. Roads and parking lots with soil or gravel surfaces and temporary greenhouses that cover the soil surface for less than 6 months are not considered impervious surfaces.

Delineate Building Envelope(s)

Building envelopes (a.k.a. farmstead areas) are places where existing and future structures on the farm or ranch are located. The deed terms will describe the envelopes, including the number and total acres and any other limitations and requirements. The boundaries and locations of existing and future building envelopes are identified in an exhibit attached to and recorded with the deed. Building envelopes can be fixed or floating. The location and boundaries of fixed envelopes are identified prior to closing. Floating envelopes are sited after the easement has closed by amending the deed exhibit and must be approved by the NRCS State Conservationist.

You will need to prepare and provide to NRCS a map of the location and boundaries of such building envelopes no less than 90 days prior to the planned closing date. In addition, the impervious surface area within each building envelope must be identified and will contribute to the overall limitation on impervious surfaces in the easement area.

If there are no existing structures on the easement area and the construction of new structures on the easement area will be prohibited, provide NRCS with a statement that the easement will have no building envelope and address this prohibition in the agricultural land easement deed.

Confirm Legal Description

The legal description of the ALE parcel must conform to the description set forth in the title records for the funded parcel. The legal description of the ALE parcel must comply with the survey standards in the state in which the parcel is located. Both existing and new legal descriptions must close to within the tolerances set by the State survey standards. NRCS has no separate ACEP-ALE boundary or survey standards or requirements.

You will need to obtain a new boundary survey and legal description if any of the following apply:

  • The legal description of the ALE funded easement area is different than the current legal descriptions of record, unless NRCS determines the current legal description is adequate for ALE purposes.
  • NRCS determines the current legal description that would be relied upon for the ALE parcel is not accurate.
  • The ALE funds are being used to protect less than the entire area protected by a larger conservation easement and the current legal description does not match the ALE portion.
  • The State Conservationist has established conditions for their state under which a new or updated survey or legal description is required.

Submit the legal description or, if required, a draft survey to NRCS at least 90 days before the planned closing date. It should identify all easements, rights of ways, encroachment, etc.

READ
  1. ACEP Program Manual sections 528.61, 528.60 B

Procure an Appraisal

Your organization will need to obtain a determination of the fair market value of the agricultural land easement for each parcel. The appraisal provides the market value of the property before the easement is placed on the property and the market value of the property after the easement is placed on the property. The difference is the value of the easement.

Appraisals must be conducted by a certified general appraiser using any of the following:

  • Uniform Standards of Professional Appraisals Practices (USPAP) or the Uniform Appraisal Standards for Federal Land Acquisitions (UASFLA or “Yellow Book”)
  • Area-wide market analysis
  • Another method approved by NRCS in writing prior to the execution of a Parcel Contract or modification to a Parcel Contract.

You will need to provide the appraiser with the NRCS Appraisal Specifications, draft deed restrictions and any unrecorded and recorded exceptions, encumbrances, agreements, leases, easements, and other clouds on the title before valuations. The landowner cannot approve or disapprove of the appraiser selected to prepare the appraisal report and the landowner may not be listed as the client.

The effective date of the appraised value must be within 6 months prior to or after the date the individual Parcel Contract is executed, or within 6 months prior to or after the date the individual Parcel Contract is modified to identify a substitute parcel, or within 12 months of the closing date of the agricultural land easement on the parcel.

You should review the appraisal for accuracy and must provide NRCS a completed appraisal report at least 90 days before the planned closing of the agricultural land easement so that NRCS may conduct a technical review. The NRCS national appraiser reviews both the appraisal and the technical review of the appraisal when the easement value exceeds $1 million.

READ
  1. NRCS Manual – Easement Common Provisions section 527-Subpart E, Appraisal and Technical Review
  2. Specifications and Scope of Work for ACEP-ALE Appraisals
  3. ACEP Program Manual section 528.53

Secure Clear Title

Title Review

Obtain and review a title commitment, preliminary title report, or other form of preliminary title evidence along with all underlying documents for each funded parcel. Legal title reviews must be submitted at least 90 days before closing, but preliminary title reviews should be done earlier before there are major investments of time, resources, and money in the event there are title issues than cannot be reconciled and are not compatible with ACEP-ALE.

Evaluate the title, including all outstanding and reserved interests in the parcel including unrecorded and recorded exceptions, encumbrances, agreements, leases, easements, and other clouds on the title. Use the ACEP Title Exception Guide below for assistance. Inform NRCS of any potential impacts those recorded and unrecorded interests may have on the agricultural land easement deed’s ability to protect the agricultural uses by limiting the nonagricultural uses and for grassland enrollments, also limiting the non-grassland uses of the land. NRCS will determine whether the recorded and unrecorded exceptions will undermine NRCS ability to achieve the purposes of the program or your organization’s ability to enforce the easement. NRCS will take into consideration your review and findings. Unacceptable title issues must be remedied prior to closing the easement. Some examples include:

  • Mortgages must be subordinated or removed.
  • Life Estate, Judgments, mechanics liens, or tax liens must be removed.
  • Agricultural leases must be subordinated.
  • Any leases or easements must be removed or subordinated if they include a right of first refusal or are incompatible with the purposes of the conservation easement or agricultural use.

At least 90 days before closing, provide NRCS with a copy of the title commitment, including a copy of documents to support each title exception, a summary of title review findings, and any other requested documentation related to title. Identify and consider any unrecorded rights, title, or interests in the parcel to ensure they are not unacceptable to your organization or NRCS. Any exceptions to the requirement to remove or subordinate outstanding or reserved interests must be consistent with the Program Agreement and approved and documented by NRCS. NRCS may allow landowners to use their anticipated ALE closing proceeds to pay off the mortgage upon request, but the title must be cleared at closing.

Title Evidence and Insurance

Secure proper title evidence and insurance using an American Land Title Association (ALTA) Owner’s Policy with your organization listed as the insured on the policy. The policy issued must be for at least the full amount of the agricultural land easement purchase price.

Immediately following the closing, ensure that the closing agent issues a policy of title insurance on the ALTA Owner’s Policy with your organization listed as the insured and with the correct amount insured. The time and date of the recording of the agricultural land easement deed must also be identified in the policy.

READ
  1. Sample Preliminary Title Report
  2. ACEP Program Manual section 528.62
USE
  1. ACEP Title Exception Guide

Produce Your Plans

Highly Erodible Land (HEL) Conservation Plan

You will need to prepare a HEL conservation plan on any portions of a parcel that contain highly erodible cropland, which is land that has an erodibility index of eight or more. NRCS at the local level will identify any HEL. The HEL conservation plan must be developed by NRCS or a NRCS-certified planner and approved by NRCS prior to closing. You should coordinate and participate in any NRCS field visits with the landowner.

The HEL conservation plan may require conversion of highly erodible cropland to less intensive uses. Implementation of any provisions required under the HEL conservation plan must occur within one year unless the NRCS State Conservationist grants an extension due to conditions beyond the landowner’s control. If there are changes to the agricultural operations on the parcel or ownership of the parcel, the HEL conservation plan must be updated.

Agricultural Land Easement Plan (ALEP)

The ALEP is a living document that may be adjusted as ownership, operations or objectives change and is intended to provide flexibility for management of the land within the purposes of the easement. An ALEP may be comprised of a general agricultural land easement plan, a grassland management plan, a forest land management plan, an HEL conservation plan (on those portions of a parcel that contain highly erodible cropland), a plan for implementing conservation practices, or any combination thereof.

An ALEP is not required unless it was the basis for ranking points or required by your organization. If a plan is being developed, it must be referenced in the easement deed terms. ALE plans developed must be signed by your organization and the landowners prior to closing and a copy is provided with the payment request package.

All revisions and updates to the ALE plan must be approved by the landowner, the grantee, and NRCS. Your organization is responsible for preparation of the ALEP and compliance with any required provisions of the agricultural land easement plan.

READ
  1. Sample ALE Plan
  2. HEL/WC Compliance Fact Sheet
  3. ACEP Program Manual section 528.63 C

Prepare a Baseline Document Report

A report that documents the baseline conditions of the parcel at or near the time of closing on the easement is referred to as the Baseline Document Report. It will be referenced for monitoring and stewardship activities.

Provide NRCS a draft baseline documentation report at least 90 days before the planned closing date of the agricultural land easement. The baseline documentation report must be appended to the agricultural land easement deed or incorporated by reference.

READ
  1. Baseline Document Report List of Items
  2. ACEP Program Manual section 528.60 C

Finalize Documents and Reaffirm Funding

Submit Final Documents Required for NRCS Internal Controls and Payments

Prior to closing or requesting an advance payment, provide NRCS with a copy of the agricultural land easement deed and all exhibits, including the legal description or survey and map showing fixed building envelopes, appraisal, title commitment, baseline documentation report, and as applicable, the agricultural land easement plan and HEL plan. These documents should be provided at least 90 days before the planned closing date, or as specified in the terms of the agreement. It is highly recommended your organization provide these deliverables much sooner so there is time to resolve any issues identified in the internal controls review process, as some issues may take considerable time to resolve and thus delay closing.

NRCS is responsible for the administration and management of ACEP-ALE funds. Therefore, all obligations and payments for the acquisition of the easement must comply with the most current easement internal controls policy. If you have not met the requirements, NRCS cannot make payment.

Confirm Matching Funds

Provide to NRCS the completed, applicable form NRCS-CPA-230 signed by you and the landowner at least 30 days prior to the planned closing date for reimbursements. This form is submitted at least 60 days prior to the planned closing date for an advance of the Federal share for the purchase of an . 

Any eligible procured costs as identified in section IV(B)(3) of your Program Agreement relied upon to meet the applicable minimum non-Federal share must be identified on this form. Include evidence of procured cost amounts, including copies of paid invoices or receipts (or unpaid invoices if an advance of the Federal share is requested) as part of the payment request package submitted to NRCS.

Submit a Payment Request Package

Payments are based on the information provided on the payment request form, NRCS-CPA-1268 Conservation Activity Approval and Payment Application for Acquisition of Easements and associated documents. Form NRCS-CPA-1268 must be used to document and process all ACEP-ALE cost-share assistance funds which constitute the Federal share provided by NRCS. You must submit all required supporting documentation as identified in this form as part of the payment request package.

As a reminder, you must also obtain NRCS approval of the agricultural land easement deed and exhibits, including the legal description or survey, appraisal, title commitment, baseline documentation report, and as applicable, the agricultural land easement plan, prior to closing on an agricultural land easement or advancing the Federal share. NRCS documents its approval of the required documents by completing and signing the “NRCS Approval Letter to Proceed with the ACEP-ALE Acquisition” and provides a copy to the eligible entity.

NRCS will populate the information required on the first page, the “Conservation Activity Performed” section, and the “Payment Summary” section of form NRCS-CPA-1268. You will verify the information populated by NRCS, submit the required documents identified in section 2, complete section 5, and return the signed Form NRCS-CPA-1268 to NRCS.

NRCS will certify that all the required documents have been submitted to meet the program and conservation activity requirements identified in the “Conservation Activity Certification” section.

The “Payment Summary” section will include information for all eligible entities that will receive payment of the federal share as indicated on form NRCS-CPA-1265 or any subsequent modifications. Any eligible entities with a 0 percent payment share do not need to be included.

The distribution of the payment amount owed to each eligible entity must be identified on form NRCS-CPA-1268. In the “Payment Distribution and Assignments” section, NRCS will document the total amount owed to each eligible entity and you will identify how the funds owed will be distributed. Specify the recipients, the amounts to be paid to each recipient, and the required account information. Provide the executed assignment of payment documentation for any portion of your payment that is being assigned to the closing agent as identified in the “NRCS Closing Agent Requirements” or to another assignee, as identified in Form CCC-36, “Assignment of Payment.”

You may submit the payment request package either as a reimbursement or an advance payment:

Reimbursement

After the agricultural land easement has been recorded and the landowners have been paid, you may receive the funds directly or may assign the payment on the payment request form NRCS-CPA-1268.

Advance

To request advance payment of the Federal share, you must submit a payment request package no later than 60 days before the planned closing or according to the requirements set forth in the Parcel Contract. The payment request package includes form NRCS-CPA-1268 and all required documentation as identified on the form.

For advance payments, you must assign the payment of the Federal share to the closing agent (payee) on the payment request form. Your organization is the recipient of the Federal funds, and the closing agent is a vendor providing a service to you.

No more than 30 calendar days prior to the planned closing date, and only after NRCS has approved all required documentation, may NRCS make an advance payment of the Federal share to the closing agent by Electronic Funds Transfer (EFT) for the closing agent to hold in escrow. After the Federal share is deposited into a fully insured escrow account and prior to the closing, the eligible entity must obtain a receipt for the Federal funds from the closing agent and provide it to NRCS. The closing agent may not hold the funds in escrow for more than 30 calendar days. If the agricultural land easement cannot be closed within 30 calendar days, the closing agent must return the funds (and any accrued interest) to NRCS.

READ 
  1. ACEP Program Manual sections 528.80, 528.81 D, 528.82
  2. National Instruction 300-306 – ACEP-ALE Program Agreements and Parcel Contracts
  3. NRCS Approval Letter to Proceed with the ACEP-ALE Acquisition
USE
  1. Form NRCS-CPA-230E, “Statement to Confirm Matching Funds for General ALE”

Complete the Transaction

Execute Closing Documents and Record the Deed

Closing documents for the agricultural land easement may be signed only after you have received the NRCS-signed Form NRCS-CPA-230, “Statement to Confirm Matching Funds,” and for non-certified entities, only after you have been notified that NRCS has completed its reviews and provided “NRCS Approval to Proceed with ALE Acquisition” letter.

Payment of the Federal share of the agricultural land easement may be issued to you (primary eligible entity) on a reimbursable basis after the easement is acquired or as an advance payment issued up to 30 days prior to closing. For advance payment, an escrow account must be established and fully insured by the closing agent. Your closing agent must certify via the Closing Protection Letter that they have insurance covering the full amount of the federal investment in the transaction. The closing agent must follow the best practices for real estate transactions in your state, having up-to-date knowledge of the requirements of state law in connection with closing real estate transactions and title clearance. The closing agent must be licensed to engage in title insurance business in the state and the title insurance company must be approved by the State Insurance Commissioner.

Immediately prior to closing, the closing agent is to examine the real estate records covering the time from the effective date of the title commitment to the date of closing to determine that no new encumbrances have been recorded, nor any adverse change in title that might result in a new title exception on the policy. If there are new title encumbrances, the closing cannot proceed.

For ACEP-ALE, it is common for the closing agent to obtain the properly executed agricultural land easement deed from the grantor (landowner), grantee (Eligible Entity) and any Co-holders prior to closing as it may be impractical to have all parties at the closing. Other applicable documents such as the Trustee’s Certificate, subordination agreements, releases, and other title curative documents may also be signed prior to the closing date.

All property taxes are paid to the date the agricultural land easement is recorded. At closing, the closing agent disburses proceeds of the sale to the landowner, less any expenses to obtain and record the properly executed easement deed and curative documents, and prepares a Closing and Settlement Statement, if applicable.

The closing agent must record or file the agricultural land easement deed in the office where local land records are officially recorded and stored in that State (e.g., county registrar of land records, county or town clerk land records office, etc.) within 5 business days of conveyance of the agricultural land easement to the holder.

Post-Closing

The closing agent is also responsible for delivering all the following to you:

  1. The statement covering the agreed upon closing costs
  2. Original policy of title insurance on the standard ALTA owner’s policy form that lists the time and date of the execution of the ALE deed
  3. Executed settlement statement
  4. Recorder’s certified copies of the agricultural land easement deed and subordination agreements and curative documents, if applicable
  5. IRS Form 1099-MISC reporting information for landowners. You may prepare 1099-MISC for reimbursement payments, but the closing agent must prepare it for advance payments.

Immediately following closing, the closing agent will issue a policy of ALTA title insurance. Title exceptions cannot be added to this policy after closing. Review this policy to ensure it matches the title exceptions that were approved by NRCS prior to closing.

Submit Final Documents to NRCS

Provide NRCS with a copy of the recorded agricultural land easement deed, all exhibits and curative documents, including subordination agreements and the final policy of title insurance, and the final settlement statement. Once NRCS receives these documents, it can complete the payment (for reimbursements) and close the parcel contract. Refer to the previous section Submit a Payment Request Package for more detailed information regarding reimbursements and advance payments.

READ
  1. NRCS Closing Agent Requirements
  2. ALTA Closing Protection Letter Example
  3. ACEP Program Manual section 528.82 F

Promote the Project

After closing, remember to acknowledge key stakeholders and highlight project outcomes. This outreach can help raise public awareness about the importance of farmland and ranchland protection and build public support for your organization or program. By acknowledging key funding sources like ACEP-ALE, you can help demonstrate the need for these programs to policymakers.

See the media toolkit below to get ideas for outreach across multiple channels. Use the below Success Story Template to create a profile about the project. Start with the landowners. Ask them to express why they wanted to protect their land and what goals the project helps them achieve.

USE
  1. NRCS Success Story Template
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Steward the Easement

More information coming soon!

New Guidance from USDA NRCS

NRCS periodically releases national instructions and bulletins to clarify program implementation. Consult with your state ACEP-ALE program manager for more information.

This collection is intended for informational purposes. Eligible entities should consult with their state’s ACEP-ALE program contact for confirmation of state-specific program and application requirements.

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