BIG GREEN | A House in the Woods

Nonprofit Sells Scenic Acreage to Allies at a Loss

By Joe Stephens and David B. Ottaway
Washington Post Staff Writers
Tuesday, May 6, 2003

Last of three articles

On New York's Shelter Island, the Nature Conservancy three years ago bought an undeveloped, 10-acre tract overlooking its Mashomack Preserve, an oasis of hardwoods and tidal pools located just a stone's skip from the exclusive Hamptons. Cost to the charity: $2.1 million.

Seven weeks later, it resold the land, with some development restrictions, to James Dougherty, former chairman of the charity's regional chapter, and his wife, Nancy, a trustee at the Conservancy's preserve. Cost to the Doughertys: $500,000.

The transaction follows a pattern seen in Conservancy land deals across the nation. Time and again, the nonprofit has bought raw land and resold it at a loss to a trustee or supporter. The sales are part of a program to limit intrusive development, but generally allow buyers to construct homes on the environmentally sensitive sites.

The buyers, in turn, cover the Conservancy's costs by giving the charity cash gifts in amounts roughly equal to the organization's loss on the sale -- $1.6 million in the Shelter Island deal. The donations benefit the buyers, allowing them to take significant tax deductions -- just as if they had given money to their local charity.

The public benefits, too, the Conservancy stresses, because during the transactions it attaches to the deeds permanent restrictions prohibiting development. Those restrictions lower the land's market value, the group says, justifying resale at reduced prices.

On Shelter Island, an easement added to the deed does block development: subdivision, mining, drilling, dikes, dams, garbage dumps and wholesale destruction of vegetation.

But there are exceptions:

The covenant authorizes construction of a single-family house of unrestricted size, garages, a swimming pool, a tennis court, a home office, a guest cottage and a writer's cabin. It allows relocation of an access road, installation of septic facilities, construction of foot trails and related excavating, filling and bulldozing. It permits outside benches, tables, chairs, gazebos, birdbaths and screened tents.

It allows cutting firewood for personal use and, on a particular portion of the property, it authorizes tree cutting, hillside terracing, gardening and lawn planting, all to provide the owners with "enjoyment of views." It approves construction of a dock on an ocean cove.

What it does not require: public access.

Dougherty said the restrictions did not affect his plans for the property.

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