A growing number of communities, faced with a dwindling supply of unspoiled scenic land, are eyeing an innovative and much-debated concept enabling them to buy properties that otherwise would be lost to developers.

As they grapple with an influx of housing and office developments, localities and states throughout the country are increasingly using so-called land banks to purchase land and protect open space.

Keeping environmentally valuable land out of the hands of developers is also a major issue on several state ballots next week. Voters in Maine, Rhode Island, Pennsylvania and other states will go to the polls to decide multimillion-dollar bond referendums that would provide funding to acquire huge tracts of forests, open fields, marshes and farm land to protect lands from developers.

In New York last year, voters approved a $250 million bond measure allowing the state and municipalities to purchase land, primarily in the state's rapidly diminishing forests.

Protecting open space on a national level is also becoming an issue for Congress. In June, Sen. John Chafee (R-R.I.) introduced legislation that would provide up to $1 billion a year to the federal, state and local governments for the purchase of forests, wetlands and other fragile areas that are in danger of being developed. Part of the funds for the program would come from a national real estate transfer tax that, as proposed now, would be levied on transactions worth $5 million or more.

But on the hometown level, particularly in New England, land banks are seen as a solution to the rampant tide of development that is overtaking many small communities.

Although the basic goals are similar to longstanding land purchase efforts by private environmental and conservation groups, land banks are not run by a single interest group intent on halting all development within a community. Rather, they are approved, usually overwhelmingly, by a municipality's voters, many of whom see development as something to control but not necessarily stop.

The central difference in approach between the private groups and the growing number of towns using land banks is in the method of funding.

Unlike the private groups that rely on donations, community-sponsored land banks typically use a real estate transfer tax to obtain money for land. Such funding measures, usually a 2 percent tax on all local real estate transactions, has aroused the wrath of builder and real estate lobbying groups, who claim the transfer tax is unfair and discriminates against them.

The land bank concept has caught the eye of a number of towns during the three years since Nantucket, Mass., a popular summer vacation island, started what has become the nation's model program. The Nantucket land bank program has purchased -- or "saved," as its supporters like to say -- nearly 800 acres of much-prized land.

So far, raising funds through the real estate transfer tax has not been a problem for the land bank on Nantucket -- a booming area off the coast of Cape Cod where real estate development is booming and where year-round population soars from 6,000 in the off-season to more than 50,000 in the summer.

In the first three years, more than $12 million was raised for the land bank. Last year alone, during a frenetic buying and building season, about $5.1 million was obtained through the transfer tax -- an average of nearly $14,000 each day for the purchase of open space.

"This is a very successful way of slowing down and coexisting with the development and growth of Nantucket," said Wayne Viera, chairman of the Nantucket Land Bank Commission. "I'd like to think that Nantucket is doing something to set a precedent for the rest of the country for conservation of open lands."

The Nantucket program has purchased environmentally sensitive wetlands, woodlands and more than a mile of the island's most valuable possession: oceanfront property. In all cases, the properties were considered prime for development. Now, however, the public land is available to residents and visitors who prefer the open space to posh seaside housing developments.

Stemming development was a motivating factor in the group's most expensive purchase, a $4.5 million deal for a 160-acre golf course that, if developed, could have been divided into more than 300 residential lots. The land bank also paid $450,000 for a five-acre parcel in the center of the historic village that will be transformed into a park.

The Nantucket land bank program, like those in other towns, relies heavily on the generosity of sellers. With a limited source of funds, Viera acknowledged that his group cannot directly compete with a developer if it is intent upon getting a particular piece of property. That is especially true if the seller is looking for the highest offer.

Consequently, land banks seldom pay market prices for the properties they purchase, although at times they find themselves bidding with development firms.

"We're buying from conservation-minded people," Viera said. "They are mostly people who have been here for years and are more dedicated to the life that was Nantucket of the past. They're not selling Nantucket down the tubes."

Nantucket and its nearby island neighbor, Martha's Vineyard, where an aggressive land bank program also exists, found the political climate relatively receptive when the notion was proposed several years ago. Surprisingly, few real estate executives or developers there opposed land banks as an unfair tax.

"I am first a conservationist," said Viera, himself a real estate executive who has lived on Nantucket all his life.

But other Massachusetts towns that have land bank proposals pending before the state legislature are finding a formidable foe in the real estate and development lobby. Communities there, like those in many states, need approval from the state legislature in Boston before a land bank program can begin. In the past year, voters in 36 Massachusetts towns have approved land banks. Those initiatives are now pending before the state legislature.

But the state real estate lobby maintains that it has had enough of land banks in Massachusetts. Those politically powerful groups are waging a major campaign against the 36 proposed land banks, as well as a bill that would approve land banks as a voluntary concept for all 351 towns and cities in the state.

"Our opposition is very simple," said Robert Nash, the chief lobbyist for the Massachusetts Association of Realtors. "The transfer tax is very discriminatory. It is only being levied on those who choose to buy or sell homes, but the benefit goes to the entire community. {The costs} for an open space policy should be borne by the entire community."

Some communities have already felt the power of the real estate lobby.

Norma Willis, a Republican representative in the Rhode Island legislature who unsuccessfully fought for a measure that would have created a land bank program in the town of Jamestown, said the lobbyists "really got to" the legislature.

Real estate and development lobbyists "said they didn't want the land bank concept spreading," Willis said. "I think their fear is that communities will try to buy everything in sight, and that's just not realistic."

Last year, the Rhode Island real estate lobby also successfully fought a bill that would have created a voluntary land bank program statewide, a measure similar to the legislation being debated in Massachusetts.

Two Rhode Island communities -- Block Island and Little Compton -- were successful in getting land bank programs enacted, but not without a fight.

Keith Lewis, the chairman of the Block Island Land Trust who earns his living as a merchant seaman, spent six months battling real estate lobbyists before his island's land bank was approved last year.

Since then, Lewis' group has been studying the island's comprehensive plan and polling residents to find the land to best preserve from development. The group has raised $550,000 through a 2 percent transfer tax, and is negotiating its first two transactions.

"We've always had a very strong conservation ethic out here," Lewis said. "When we came under the threat of overdevelopment, it was natural for the island people to respond and protect the significant areas. We're not against development, but we try to work for sensible development."

Other communities with land banks purchase development rights, but not the actual properties.

Such a concept is becoming popular with farmers, a rapidly diminishing segment of the population who view land banks as a way to continue farming while obtaining money for their valuable land.

In Little Compton, a town proud of its remaining supply of farmland, farmers are offered money not to sell land to developers or allow any building on their land. In return, the farmers retain ownership and are able to keep farming.

Moreover, to the delight of Little Compton taxpayers, the properties remain on the tax rolls, unlike other land bank programs where communities become the owner.

In the first year of the Little Compton program, which is open to all properties in the town, about $350,000 has been raised. The land bank is now negotiating with three land owners for development rights to their properties.

"Farm land is particularly at risk in Little Compton because it is the easiest to develop," said David Borden, chairman of the Little Compton Agricultural Conservancy Trust.

Borden said despite opposition from the real estate lobby, the land bank concept is "a real painless way to raise fairly significant sums of money and put that money to good public use.

"I would not characterize it as stemming development," he said. "We just want to maintain some of the rural qualities that make Little Compton a very desirable town to live in."