The Agricultural Conservation Easement Program – Agricultural Land Easement (ACEP-ALE) is a voluntary federal conservation program implemented by the USDA Natural Resources Conservation Service (NRCS) that protects private agricultural land from conversion to non-agricultural uses. ACEP-ALE provides funds that can be used to help buy conservation easements on farm and ranch land.
A conservation easement is a voluntary deed restriction you can place on your property to protect natural resources and open space on your land by prohibiting future development. The easement is granted to an entity, like a land trust or a public agency, which has the authority to monitor and enforce the restrictions agreed to in the easement agreement.
These restrictions can cover either an entire parcel or just a portion. As a landowner, you would work with the entity who will hold the easement to decide which areas will be protected and which uses and activities will be prohibited.
Conservation easements are permanent and run with the land. This ensures the land will be protected from development in the future even with new landowners.
An agricultural conservation easement is a specific form of conservation easement that is designed to permanently protect farmland and keep it available for farming. Agricultural conservation easements limit what can be built on the property and where, and limit non-farm development, subdivision, and other uses that are inconsistent with farming. As a landowner, you work with an entity that will hold the easement to decide which areas will be protected and which uses and activities will be prohibited in alignment with minimum requirements.
Land with an agricultural conservation easement may be more affordable to future buyers, supporting new and beginning farmers. Protecting your land with an agricultural conservation easement may also provide several tax benefits.
The Agricultural Conservation Easement Program (ACEP) provides technical and financial assistance to conserve and protect farm and ranch lands, grasslands and wetlands. Under the Agricultural Land Easement (ALE) component, the USDA Natural Resources Conservation Service (NRCS) partners with eligible entities–such as Indian tribes, state and local governments and non-governmental organizations–to buy agricultural conservation easements on working agricultural lands.
NRCS sets the minimum criteria that all land, landowners, and entities must meet to qualify for funding. They process and rank applications submitted by entities. Once the easement transaction has closed, the entity you participate with will be your contact for monitoring and stewardship. As an additional protection, NRCS maintains a right of enforcement throughout the life of the easement.
NRCS is a federal agency within the U.S. Department of Agriculture. NRCS works with farmers, ranchers, and non-operating agricultural landowners to help improve agricultural productivity and protect natural resources through conservation programs.
The agency has a statewide office in each state and local service centers in most counties throughout the U.S. Some local service centers serve more than one county. ACEP-ALE program administration staff are often located in the state office, while district conservationists and field staff are in local offices.
NRCS will work with the organization you partner with and who will serve as the primary applicant to ACEP-ALE. Together they will communicate throughout the process on your behalf, from establishing or updating your records in NRCS’ system, to inspecting and confirming the easement’s eligibility.
Before you invest more time, consider if you are:
Participating in ACEP-ALE requires that you find an eligible entity that will agree to hold the easement on your land. Eligible entities can include nonprofit organizations, like land trusts, state or local government bodies, or Indian tribes and must meet the ACEP-ALE criteria including having an existing program that protects farmland or ranchland. The entity will be your partner throughout the application and acquisition processes and will continue to monitor and enforce the easement on your land once the closing is complete.
The entity will be the primary applicant for ACEP-ALE and is responsible for gathering and submitting the application materials and supporting documentation. The entity is the applicant because they are requesting the matching funds from NRCS to help pay you for the easement on your land.
For more information about entity eligibility criteria, visit the ACEP-ALE for Entities web pages. Eligible entities can include the organizations listed below.
A land trust is a private, nonprofit organization that protects natural resources such as productive farm and forest land, watersheds, rivers and streams and recreational areas. Land trusts acquire land and/or conservation easements, accept donated land and/or easements, facilitate land protection projects, and steward properties and easements to ensure that the conservation purposes are upheld over time.
Programs administered by public agencies can participate in ACEP-ALE.
The most active public entities are Purchase of Agricultural Conservation Easement Programs (PACE) that pay property owners to keep productive land available for agriculture. PACE is known as purchase of development rights (PDR) in many locations.
Twenty-eight states have agencies that administer PACE as a public program, often through the State Department of Agriculture. The state program either purchases and manages easements directly or provides funds that local governments or non-governmental organizations can use to purchase and manage the easement. Local PACE programs work the same way though are administered at the local level by a county, city or town government.
Another local entity that can serve as a partner is a local soil and water conservation district. Soil and water conservation districts are in almost every county in the U.S. and work with landowners in their area to promote resource conservation.
Tribal entities also are eligible to participate in ACEP-ALE. They must be a “federally recognized Tribe”, meaning they are listed in an annual publication from the Bureau of Indian Affairs (BIA) in the Federal Register.
Landowners who want to apply to ACEP-ALE need to meet minimum eligibility criteria related to income and on-farm conservation compliance. Each landowner must separately qualify to receive USDA funds to be eligible. Therefore, it is important to identify every person or entity that has ownership rights in the land prior to applying, as each will need to separately complete eligibility documentation. If the land is owned by an entity, all members of that entity must meet income requirements. Depending on the entity ownership structure, members may need to meet conservation compliance requirements. Your farmland protection partner and the staff at USDA’s Farm Service Agency can help guide you through the eligibility certification process.
In order to be eligible, you will need to have the following three items:
The Farm Service Agency (FSA) is an agency of the USDA that handles many financial operations for the department’s programming. For ACEP-ALE, FSA is the agency that verifies landowner eligibility to receive funding. FSA offices are often co-located with NRCS offices. These offices are called Service Centers and have locations in almost every county across the country. You can make an appointment with your local Service Center to get the relevant forms and receive assistance completing them. When making your appointment, ask FSA staff what documentation you should bring with you in order to streamline the process. If you have participated in USDA programs in the past, you may have records already established that identify the parcels you own and/or farm and other farm information.
FSA staff will enter your identifying information and parcel information into USDA’s centralized Service Center Information Management System (SCIMS), which is needed to process your eligibility certification. The resulting report is a Subsidiary Print that summarizes key eligibility information. Ideally, this documentation should be completed at least 2 to 3 months before applying. You should contact FSA and start the process as early as the start of the new federal fiscal year (October 1).
Have a discussion with your farmland protection partner about the criteria that need to be satisfied to make your land eligible for ACEP-ALE funding. Work with your partner to talk about your long-term land planning needs and goals and discuss how to make an ACEP-ALE easement work for your land within the program guidelines.
In order for your land to be eligible, it needs to satisfy a list of criteria:
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 by NRCS in ranking the application against others. Be prepared to provide evidence of these factors at the time of application to make your project more competitive.
At the beginning of the application process, it’s important to think about what land to enroll. The arrangement of the acres proposed for enrollment will impact your land’s eligibility and ranking. Note that changing the configuration changes the value, so this should happen before an application is submitted. If the proposed easement boundaries are different than the property boundaries, you may need to procure a survey before closing on the easement.
Start exploring potential easement boundaries with your farmland protection partner using the Web Soil Survey tool below, noting your property’s land uses and soil quality.
It is important to understand your farmland protection partner’s conservation easement and the ACEP-ALE minimum deed terms that will be incorporated into the easement before applying. ACEP-ALE minimum deed terms are mandatory. It may be difficult to change your easement once it is on the land. Hire your own attorney to help review the easement terms and represent your interests in the transaction, which may be different than your farmland protection partner’s interests.
Some deed provisions depend on choices you and your farmland protection partner make before closing. Think about how the terms will affect your operation and ability to achieve personal and business goals. For instance, the deed will specify a land enrollment type (farmland, grassland, or grassland of special environmental significance) that may impact agricultural production. If you are awarded ranking points for a particular resource, such as wildlife habitat, the easement provisions have to protect that resource, which may affect future uses of your land. Pay particular attention to the following ACEP-ALE minimum deed term limitations which are described in the Minimum Deed Terms below:
Each year, NRCS issues guidance on ACEP-ALE implementation. After this 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. Your farmland protection partner will likely be aware of the typical application timelines. In addition, you can find the web pages for your state office using the “List of NRCS State Offices” link below. If information is not available or out of date, contact the state program manager.
NRCS makes determinations about eligibility and ranking based on the documentation you and your partner supply. 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.
Your partner will take the lead on filling out the application forms for ACEP-ALE. They will complete an Entity Application (CPA-41) to establish their relationship with NRCS. The Parcel Sheet (CPA-41A) is the application form that gathers information about your parcel and the funding requested. You will sign this Parcel Sheet and certify you have received and understand the easement requirements. Funding decisions will only be made once all application forms are submitted with supporting documentation.
If your application meets NRCS eligibility criteria, agency staff will work with you and your farmland protection partner to set up a site visit. This is needed to verify the application materials and the condition of the land and infrastructure. NRCS staff will complete the three below forms with information from an interview with you and the site assessment. In addition, NRCS will work with a private environmental firm to check records for any hazardous material spills or potential off-site sources of contamination that might impact the parcel. Funding decisions are made once these steps are complete.
Now that your farmland protection partner has submitted an ACEP-ALE application that has gone through an initial review, what comes next? NRCS will notify your partner that your project was selected for funding. Your partner will coordinate with NRCS to manage the acquisition process through closing. Timing and coordination of the acquisition process varies depending on your state and partner. Remember to keep in regular contact with your partner throughout the process. The sooner you can respond to requests for information from your partner, the better. See below for key steps in the process. Most documents are due at least 90 days before the planned closing date, but your partner may want to complete these steps sooner so there is time to resolve any issues that come up in the review process.
Your partner will enter into a Program Agreement with NRCS as well as a Parcel Contract specific to your property. The Parcel Contract includes a series of forms that identify the entity partners, the amounts to be paid for the easement, identifies you as the landowner, and confirms you meet eligibility criteria. Once your partner and NRCS sign these forms, the clock starts for acquiring an easement. In general, ALEs must close within three years, but some extensions may be approved.
You will work with your partner to finalize the deed (“the ALE deed”). Your partner will work to incorporate the ACEP-ALE Minimum Deed Terms (MDT) into their conservation easement. Make sure an attorney representing your interests reviews the draft ALE deed to understand its potential impacts on your land and operation and future operations. Pay particular attention to the following terms which depend on choices you and your farmland protection partner make before closing:
There are additional issues to consider including, but not limited to, water rights, renewable energy, and telecommunications. Review the Minimum Deed Terms and NRCS Title Exception Guide below and discuss them with your attorney and farmland protection partner before the easement closing. Once the ALE is placed on the parcel, conveying interests like rights-of-way to others will need to be evaluated and approved by your partner and, in some cases, NRCS.
Your partner will submit the draft deed to NRCS for approval at least 90 days before the planned closing date so there is time to address any issues. NRCS will review the easement for compatibility with the program requirements.
The description of the parcel included in the ALE deed must match the description in the underlying property deed and meet the state’s survey standards. It should identify all easements, rights of way, encroachments, etc. You or your partner will need to obtain a new survey and legal description in certain situations. For instance, if the legal description of the parcel covered by the ALE does not match the current recorded property description, or if the portion of the parcel covered by the ALE is smaller than the total parcel size. Your partner may hold off on ordering a new survey, if required, until the appraisal and title review are completed to avoid unnecessary costs.
Your partner will submit the legal description and, if applicable, the new survey to NRCS at least 90 days before the planned closing date.
Your partner will obtain a determination of the fair market value of the ALE by ordering an appraisal report. You will not select the appraiser or be listed as the client. 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.
Your farmland protection partner may have obtained an appraisal before submitting the application to inform their negotiations with you and enable them to submit a more accurate request for the ACEP-ALE cost-share (the NRCS share is based on the lower of the value requested on the application or the appraised value). In addition, some states may also provide ranking points for submitting an appraisal with the application.
The effective date of the appraisal must be no earlier than 6 months before the Parcel Contract is signed and before the closing of the ALE. An update to the appraisal will be necessary if prepared earlier than 6 months prior to execution of the Parcel Contract. The final version of the ALE deed needs to be considered in the appraisal if the deed terms provided to the appraiser changed. Your partner will submit the final appraisal report to NRCS for a technical review at least 90 days before closing.
Your partner will need to obtain a legal title review. The resulting report will identify any outstanding interests, exceptions, or issues. Typical issues that will need to be addressed include mortgages, life estates, judgments, leases, and mineral interests. Your attorney, in consultation with your partner, is responsible for reconciling any title issues.
Mortgages must be subordinated or removed. NRCS may allow you to use your anticipated ALE closing proceeds to pay off the mortgage upon request, but the title must be cleared at closing. Any leases or easements that include a right of first refusal or are incompatible with the purposes of the conservation easement or agricultural use must be removed or subordinated. Agricultural leases must be subordinated. Life estates, judgments, mechanics liens, and tax liens must be removed. Your partner will discuss any mineral interests, rights, or leases with your state NRCS program manager.
At this stage, your attorney and your partner are working toward removing or subordinating other interests as required. Any exceptions to the requirement to remove or subordinate outstanding or reserved interests must be approved by NRCS. To make this process smoother, your partner will explain in writing why each title exception will not impact the ALE and submit these explanations to NRCS. NRCS will determine whether these exceptions are acceptable and will take into consideration your partner’s documentation.
At least 90 days before closing, your partner will provide NRCS with a copy of a title commitment—a promise from the title company to provide title insurance for at least the full amount of the ALE purchase price. The title commitment will include a copy of documents to support each title exception, a summary of title review findings, and any other requested documentation related to title.
Your partner will secure proper title insurance using an American Land Title Association (ALTA) Owner’s Policy with your partner listed as the insured. The policy issued must be for at least the full amount of the agricultural land easement purchase price.
In general, you are not required to have a land management plan to participate in ACEP-ALE. There are three circumstances that require plan development and implementation.
Draft plans are submitted for NRCS review at least 90 days before closing.
Your farmland protection partner will prepare a Baseline Document Report that documents the baseline conditions on your property at or near the time of closing. Trash, debris, encroachments, and other issues should be adequately addressed prior to the easement so as not to be part of the baseline condition. It will be referenced for monitoring and stewardship activities. Your partner will provide NRCS a draft report at least 90 days before the planned closing date of the ALE.
You and your partner will confirm the sources of the non-Federal share of the easement cost and sign the appropriate version of form NRCS-CPA-230. You may be asked to help document any expenses being used as part of the non-Federal share.
Your partner will submit a Payment Request Package to NRCS with the latest versions of all items outlined above. Ideally, these will be the final versions that have integrated all revisions or changes identified by NRCS during prior review. NRCS cannot authorize the closing or payment until the package is approved. Your partner will arrange for an advance payment or for reimbursement. Either way, you will receive payment for the easement at closing. Advance payments require earlier submission of the final documents and request package.
The easement closing is the transaction that officially transfers your property’s development rights to your farmland protection partner in exchange for payment. You and your partner can proceed to closing once your partner receives approval from NRCS. Your partner’s attorney or a title or escrow company often serves as the closing agent.
The closing agent coordinates the documents needed to complete the easement transaction, including the ALE deed and any subordination agreements. They examine the real estate records from the date of the title commitment to the closing to make sure no new encumbrances have been recorded. The closing agent prepares a closing or settlement statement, if applicable, and disburses the payment to you minus any costs of recording the deed and other title documents. The agent then records the ALE deed in the office where local land records are officially recorded in that state (e.g., clerk or registrar of land records) within 5 business days of the closing date.
After the closing, the closing agent will issue a title insurance policy to your partner. For advance payments, the closing agent will prepare the IRS Form 1099-MISC reporting information for you for the full easement compensation amount. Your partner may prepare the Form 1099-MISC for reimbursement payments.
Once the project is complete, your partner may ask for your help acknowledging key stakeholders and highlighting project outcomes. This outreach can help raise public awareness about the importance of farmland and ranchland protection and build public support. By acknowledging key funding sources like ACEP-ALE, you can help demonstrate the need for these programs to policymakers. You may also find that your willingness to permanently protect your land is important to your customers and could consider ways to use this project to promote and market your business.
You can share your story using the below Success Story Template to create a profile with your partner about the project. If you are willing to share information about the project, express why you wanted to protect your land and what goals the project helps you achieve. It is useful for farmers, ranchers, and other agricultural landowners to hear about participation from their peers. If not, there are creative ways to talk about project outcomes without identifying you.
For more information about ACEP-ALE, visit the ACEP-ALE for Entities page.
This collection is intended for informational purposes. Landowners should work with their farmland protection partner to confirm state-specific program and application requirements with their state’s ACEP-ALE program contact.
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