Incentives for Saving Species

by Brett Schaerer

Table of Contents


What kinds of incentives can a biodiversity trust--or anyone else--give to public land managers or private landowners to protect endangered species? Here are a few ideas that can be applied whether or not the Endangered Species Act is revised or reauthorized.

Things a Biodiversity Trust Can Do

Any of the following actions could be taken by a biodiversity trust to protect endangered species. Most could also be done by any conservation group with similar goals.

Compensation for Losses

Although many courts have ruled that states are not legally required to compensate landowners for losses to crops or livestock caused by wildlife, some states do so voluntarily. Typically, state wildlife agencies will pay farmers for crop losses to elk, deer, or other game. Clearly, it is in their interest to do so to make sure that landowners do minimal harm to game herds.

A biodiversity trust, or any organization, could similarly offer to compensate losses to a rare or endangered species. The Defenders of Wildlife, for example, have reduced rancher resistance to an expansion of Montana wolf populations by offering to pay for any livestock losses to wolves.

Bounties for Rare Species

An expansion of the compensation idea would be a bounty, or simple payment, to landowners for every breeding pair of an endangered species on their land. Defenders of Wildlife has expanded its wolf compensation program by paying $5,000 to any rancher whose land provides denning habitat for a pair of wolves.

For some species, such as ferrets, a biodiversity trust could set a target for a particular number of breeding pairs and offer to pay, say, $1,000 per pair. For other species, such as prairie dogs, the target and payment might be per acre of unmolested habitat. If the target is exceeded, the bounty could be reduced; if the numbers fall short of the target, the bounty could be increased.

Conservation Easements

A biodiversity trust could purchase conservation easements from private owners, effectively compensating them for protecting endangered species habitat. A typical easement today allows the landowner to use the property for existing uses--say farming or forestry--but pays them to not alter the use to, say, residential.

Endangered species easements could take many other creative forms. The trust could pay woodland owners to avoid clearcutting or close roads after use; it could pay farmers to plant certain crops or to use no-till farming; it could pay irrigators to use less water. Easements could be purchased on a perpetual basis, which is common today, or on a lease-like basis from year to year.

One common worry about easements is that an easement can cost a substantial fraction of the total land value. If this is the case, then why not just buy the land? But in cases where easements are purchased from several adjacent owners, the fact that several neighbors have also sold easements can actually enhance the value of the property. This should reduce the cost of easements in many cases.

Bidding for Conservation

Many state and all federal public land agencies build "use-it-or-lose-it" provisions in their timber, grazing, mining, and other extractive contracts. The reasons are often political: the agencies are funded by Congress or state legislatures with the expectation that they will produce local jobs and income. If the political problems can be overcome, most agencies have no legal barrier to allowing people to bid on sales with the intention of not extracting the resources.

Several conservation groups are trying this. Forest Guardians has purchased grazing rights from the state of New Mexico with the express intention of leaving the forage for wildlife. Groups in Idaho, Oregon, and other western states are attempting to negotiate similar leases with their state land agencies. The Washington Department of Natural Resources has sold timber to purchasers who don't intend to cut it, and the Greater Ecosystem Alliance, a Bellingham, Washington, group, was the high bidder on a timber sale in the Okanogan National Forest (though the Forest Service awarded the sale to the second-high bidder).

A biodiversity trust could have the resources to significantly expand such purchases. It could also negotiate easements with public land agencies similar to those on private lands that might preclude certain activities, encourage "new forestry," or promote other practices favorable to rare species.

Contracting for Conservation

A biodiversity trust could contract out the recovery of an endangered species to private companies or non-profit organizations. At one level, "recovery firms" could specialize in providing services to the trust, such as inventorying habitat, developing recovery plans, or negotiating easements.

At a more intensive level, firms or non-profits could bid for taking on the responsibility for the entire recovery process. The trust would set specific targets, such as population numbers or acres of habitat, and payment would depend on meeting those targets.

It might even be possible to transfer the ownership of an entire species to some private party or non-profit trust. The owner would be responsible for compensating habitat owners for the costs of recovery and would have exclusive rights to any benefits generated from the species--such as from hunting, medicines, or as tourist attractions.

Things Other Agencies Can Do

Federal, state, and local agencies have powers and resources that go beyond those of a biodiversity trust. These would allow them to undertake any of the following actions, sometimes with the assistance of a biodiversity trust, on behalf of endangered species that the trust itself could not do.

Tradable Development Rights

A typical system of zoning for conservation allows development in some areas and limits it in conservation areas. The coercive aspects of such a system often generate hostility. Even when people go along, it remains inequitable because it allows people in the development zones to earn significant income that landowners in the conservation areas, through no fault of their own, are unable to share. Ironically, the land values in the development zones are often enhanced by the presence of the conservation areas.

A system of tradable development rights offers a significant improvement over a straight zoning system. Under such a system, people in the conservation areas are given development credits. Landowners in the development areas can develop their properties only after buying an appropriate number of credits from the people in the conservation areas. This insures that income from developments are shared by all.

The tradable credit system carries with it some element of coercion, since the people in the conservation area are still not allowed to develop their property. But they have the opportunity to be well compensated for that restriction--especially if the value of developable properties is significantly increased by the presence of the conservation area.

By itself, a biodiversity trust would not have the authority to impose such a system in an area of critical habitat. But it could encourage local governments to do so and provide expertise in identifying the conservation areas, setting up the credits program, and creating a market for such credits. A system similar to this has been used to protect the New Jersey Pine Lands and open space in several Maryland counties.

Land Exchanges

Four federal agencies own some 640 million acres of land. One way of compensating landowners for habitat restrictions would be to use some of this land for land exchanges.

Such land exchanges have long been common, and in recent years have sometimes been used to protect rare species. The Aerojet-General Corporation recently agreed to exchange 5,000 acres of wetlands in the Florida Everglades for 35,000 acres of federal land in Nevada (some of which is a lease rather than an outright transfer). The deal also requires Aerojet-General to set aside 17,000 acres of the Nevada land as desert tortoise habitat.

Recreation Fees

Different Drummer has long advocated the use of recreation fees on federal lands to give federal land managers incentives to consider scenic beauty and other amenities as they plan timber sales and other projects. Once the federal agencies--which manage over half of all the land in many western states--start charging fees, private landowners could also significantly benefit from such fees.

Recreation fees on private land are not a perfect proxy for endangered species, but they are a reasonably good one. Income from recreationists would lead many private landowners to modify normal timber or farm practices; such modifications would protect some habitat and significantly reduce the cost of more habitat protection.

After International Paper began charging fees for hunting on its lands in Arkansas, Louisiana, and Texas, it significantly reduced the size of its clearcuts and increased the size of streamside buffers. These measures were aimed at increasing game habitat. But International Paper also went far out of its way to protect habitat for the red-cockaded woodpecker, something it probably would not have done if recreation fees weren't significantly contributing to its profits.

Tax Breaks

Monetary contributions to conservation organizations are tax deductible. But people who dedicate land to wildlife habitat often receive no reduction in income or property taxes.

Many states allow exemptions for properties owned by non-profit groups. The biodiversity trust or any other non-profit group could offer to hold short-term or perpetual easements on someone's property. Depending on local laws, this could reduce the property tax burden for landowners supporting wildlife habitat. Where local laws are not amenable to this, conservation groups could lobby for changes in the law.

Inheritance taxes are also a significant burden for owners of large tracts of land. Many families are "land-poor," and the inheritance taxes that must be paid when lands are handed down the generations often force the subdivision and sale of the properties. Changes in federal income tax law are needed to protect many rare species and habitat.

Brett Schaerer ( is a student at Bard College in Annandale, New York, and wrote this paper while interning at the Thoreau Institute.

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