Oral Testimony of Steve McCormick On Behalf of The Nature Conservancy
Nature Conservancy Hearing Before the Senate Finance Committee: The Tax Code and Land Conservation
June 8, 2005—Mr. Chairman, Senator Baucus and members of the Committee, thank you for the opportunity to present the views of The Nature Conservancy at this hearing on tax incentives for land conservation.
The Nature Conservancy is an international, nonprofit organization dedicated to the conservation of the world's biological diversity. We are known for achieving tangible, lasting results, securing conservation for places that are carefully and scientifically selected. Our on-the-ground conservation work is carried out by over 3,000 dedicated employees in all 50 states and in 27 countries and is supported by approximately one million individual members. We have helped conserve nearly 15 million acres of land in the United States and Canada and more than 102 million acres with local partner organizations globally.
Steven J. McCormick, President/CEO of The Nature Conservancy
Photo © Mark Godfrey/TNC
I must say, the past two years have been a challenging time for The Nature Conservancy. The actions and projects carried out by our people have been subject to the closest scrutiny. But based on that examination, I am confident in saying that all of our work is, and has been, in compliance with the law and applicable regulations, and motivated by the sincerest dedication to our mission. Not everything we try succeeds, and on occasion we made mistakes, but all of our work has always been done in genuinely good faith.
Nonetheless, we have come to realize that we must hold ourselves to a higher standard — beyond mere compliance with the law and devotion to mission. In this spirit, over the past two years we conducted an extensive and rigorous internal review to strengthen our governance; enhance management oversight; increase accountability to our constituencies; and make our actions more transparent to our supporters and to the public.
As a result of this comprehensive effort, The Nature Conservancy strengthened, enhanced and added to our policies and procedures, including those applicable to our newer conservation strategies. We also convened a panel of independent experts to assist in an extensive review of governance. The panel presented a set of far-reaching recommendations detailed in my written testimony. The Conservancy’s Board and management acted quickly to adopt and implement virtually all of the panel’s recommendations. Among the many steps we have taken are:
- Changes in the size and structure of our Board of Directors to provide increased strategic guidance and more active oversight; and
- Adoption of many of the governance principles contained in the Sarbanes-Oxley Act including whistle blower protections and prohibitions on related party transactions.
Implementation of these reforms has not been easy. We are highly decentralized, with our conservation work done in state and country programs. And we have flourished on a culture that encourages risk-taking and bottom-up innovation.
Still, we are now committed to instilling a culture imbued with the principle that doing good is simply not enough. Doing good must be done right. We must carry out our work against a higher standard of integrity and public trust. We also understand that, as we continue to innovate, we must continue to refine and enhance our policies, procedures and practices to keep pace with that innovation.
In that regard, the staff report on The Nature Conservancy issued yesterday makes recommendations for several additional changes in our policies and procedures. I promise to you that we will carefully review those recommendations and let the Committee know what we intend to do in response to them.
The subject of this hearing, the federal tax incentives encouraging the donation of conservation lands and easements, is of great importance. For conservation easements have become one of the most widely-used and effective tools for securing permanent protection of lands that provide a variety of valuable public benefits.
At a time when the nation has become more sensitive to the rights of private property owners, and more fully appreciates the need to provide financial incentives for wise management of private lands, the many attractive features of conservation easements as a public policy tool are quite clear. Under conservation easements:
- Property remains privately owned and on local tax rolls;
- Many types of compatible private land use, such as farming and ranching, can continue; and
- The land can remain productive — generating jobs and revenues for local communities.
Although the vast majority of conservation easements protect important natural habitat and produce significant public benefits, as with any charitable endeavor, there have been some abuses. To ensure that conservation easements are used only in the manner intended by Congress, The Nature Conservancy submitted to Congress a series of recommendations for specific reforms in the tax incentives for easement donations that are more fully described in my written testimony. I believe that our proposed reforms effectively address all of the concerns that we have heard from members and staff of the Committee as we prepared for this hearing.
The Nature Conservancy is dedicated to the protection of natural diversity, and in our steadfast adherence to this mission we are constantly experimenting with new and innovative approaches to achieve more effective and efficient conservation, including activities that demonstrate the linkage between conservation and human use of land. But we are a charity. We do our work — are allowed to do our work — using the tools that this Committee has created and oversees. We want you to know how very important tax incentives are for conservation of land, and therefore for the unique quality of life we enjoy in our nation.
Thank you, Mr. Chairman.
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For More Information About the Topics Discussed in Steve McCormick's Testimony Before the Senate Finance Committee:
- The Nature Conservancy Responds to the Release of the Senate Finance Committee Staff Report
- Nature Conservancy Written Testimony: Senate Finance Committee Hearing: Tax Code, Land Conservation
The Nature Conservancy strengthened, enhanced and added to our policies and procedures, including those applicable to our newer conservation strategies. We also convened a panel of independent experts to assist in an extensive review of governance.
- Press Release: Statement from The Nature Conservancy
The Senate Finance Committee released a Staff report marking the conclusion of its two-year review of The Nature Conservancy. The Conservancy did not wait for the Finance Committee Staff to complete its report before undertaking our own comprehensive self-evaluation.
- Press Release: Review of Senate Finance Committee Staff Report on The Nature Conservancy
The Senate Finance Committee has publicly released its Staff Report on The Nature Conservancy. The Senate Finance Committee's Report will be one of several subjects discussed at a Senate Finance Committee hearing on conservation land transactions and related tax legislative proposals.
- About The Nature Conservancy
The Nature Conservancy is a leading international, nonprofit organization dedicated to preserving the diversity of life on Earth.
- About Us: Governance of The Nature Conservancy
Governance, accountability and transparency require ongoing diligence and review. The Nature Conservancy has made continuous improvement in these areas an organizational priority and they will remain so in the years ahead.
- About Us: Nature Conservancy Financial Reporting
Annual reports and financial reports give us the opportunity to report to you — the people who support us and make our work possible – on our recent achievements.
- Governance: Accountability and Transparency
The Nature Conservancy holds itself accountable to its members, the public and all creatures that have a stake in the preservation of the world’s natural resources.
- One-year progress report: Nature Conservancy efforts to strengthen governance, accountability and transparency
Ira Millstein, head of the Conservancy's independent Governance Advisory Panel, has produced a report assessing the changes the Conservancy has made to strengthen its governance structure and internal policies and practices.
- How We Work: Conservation Easements
Conservation easements are a powerful, effective tool for conserving private lands in the United States.
- Press Release: Nature Conservancy Releases Legislative Proposals to Strengthen Conservation Easements
April 6, 2005
The Nature Conservancy today released a set of legislative proposals designed to strengthen the laws and regulations governing conservation easements and help end abuses of this critically important conservation tool.
- How We Work: Anatomy of a Nature Conservancy Conservation Project
To achieve its mission, The Nature Conservancy has developed a strategic, science-based approach to its conservation work, called Conservation by Design, which helps it identify and work to protect the highest-priority places on Earth.
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