1 Accreditation Impact Accreditation Impact Fifteen years ago the - PDF document

Countdown to 2020: Tips and Workshop Overview Pointers for Land Trusts Preparing for First-Time • Introductions • Overview of accreditation Accreditation • Transition • Why accreditation Valerie Roof and Jessica Whittaker, • First-time application process review specialists • New/changed requirements • Documentation challenges October 12, 2018 • Start Your Plan • Tools and Resources Separate Roles Land Trust Accreditation Commission • Independent program of the Land Trust Alliance • 19 diverse volunteer commissioners • 7 staff • Sets Land Trust Standards • Verifies implementation of and Practices (last updated Land Trust Standards and in 2017) Practices (via indicator elements) • Sets accreditation • Develops accreditation indicators application, review process, • Provides general training and requirements, plus and educational materials associated training • Makes accreditation decisions Accredited Land Trusts • 411 accredited organizations • About 35 first-time applicants in process • Accredited land trusts hold more than 78% of conservation land held by land trusts 1

Accreditation Impact Accreditation Impact  Fifteen years ago the land trust community was ill  Accreditation was a strong motivator for change in land prepared to live up to the promise of perpetuity and was trusts; 87% of accredited land trusts responded that under legislative and regulatory threat . ⁻ The Alliance created the Accreditation Commission as a accreditation moderately or substantially motivated solution and offered accredited preparation services to them to make organizational improvements. its members.  Public confidence in land trusts increased as a result;  Today, accredited land trusts far outpace those not yet 85% of public agencies and foundations say accreditation accredited . increases their confidence in land trusts and 83% of ⁻ They have significantly bigger budgets, more staff and landowners feel the same way. volunteers and ⁻ 8 times more money invested to steward and defend  These positive impacts can grow as more land trusts join their conservation lands than their peers of similar size the program. – they also save 3 times more land. 10 D01: Transformation through Land Trust Accreditation SATURDAY 10:30-Noon 11 2

Application Review Applicant Conference Call • Review team (staff and commissioners) • Detailed agenda sent in advance evaluates compliance with indicator elements by considering: • Clarification/more information • Lasts about 2 hours – Pre-application/Application – Supporting documents – Project documentation – Public notice/comments – Research Commission’s Review Approach Additional Information Request • Follow-up letter with document requests or •Consistency corrective action •Fair but flexible •All must demonstrate compliance •No one-size-fits all •Recognize diversity Decision by Full Commission Questions on the Application Process? • Accredit – Awarded for 5-year term – Expectations for Improvement • Table • Not Accredit 18 3

2017 Standards  2018 Requirements 2018 Requirements Framework: Requirements: Risk-Based Key Concepts Bold Example 1. Indicator Elements in Four  New board members trained. Groups Documentation of training new board members will be verified for every 2. Documents for Each Group applicant. 3. Requirements for Each Group Non-bold Example  Land trust generally operates in accordance with its bylaws. 4. Two Categories of Red flag: look at risk in the context of the entire application. Requirements ‒ Low risk: Bylaws require 9-15 board members; land trust has 8 board • Bold members; board operates effectively. No questions. ‒ Proactive Verification ‒ Hard Stop! ‒ High risk: Bylaws require a 9-15 member board; land trust has 4 board • Not Bold members; board appears to be controlled by one member. Questions. ‒ Red Flags ‒ Next Step Depends on Risk New Finance Requirements: Records & Financial Health • Operating surplus exists at the end of Governance Finance last fiscal year [statement from board officer explains reason for deficit] • Operating reserves at the end of last fiscal year sufficiently cover three months of operating expenses [board evaluation of operating reserve needs Transactions Stewardship and a feasible plan to address the needs] • Concentrated or sole source of funding not overly relied on • Debt or lease payments can generally be met. 24 4

New Finance Requirements: Internal New Finance Requirements: Board Controls and Insurance Oversight & Donor Restrictions • Written internal controls or • Board approval of annual budget accounting procedures • Board review of periodic financial reports that include: • Have general liability insurance ‒ Unrestricted, board-designated and restricted net assets that covers significant risks ‒ Actual unrestricted and restricted revenue and expenses for • Board [or delegated entity] the reporting period as compared to budget evaluates insurance needs at least every five years: • Documentation of the business process system it follows when a) soliciting and accepting restricted ‒ Directors and officers liability insurance gifts/grants b) determining restrictions on gifts/grants c) documenting donor restrictions and d) tracking receipt ‒ Property insurance of and expenditures from restricted gifts/grants to ‒ Insurance required by law comply with donor restrictions 25 26 Changed Requirements for Audit, Defense Fund Requirements Review, Compilation 2016 2016 2018 2018 New Transaction Requirements • Evaluate the Form 8283 and landowner’s appraisal and document the following: ‒ Did not knowingly participate in potentially fraudulent or abusive transactions ‒ Involved legal counsel as appropriate, especially in potentially fraudulent or abusive transactions ‒ Took appropriate action to resolve substantial concerns with the appraisal, appraised value or other terms of the transaction Signed the Form 8283 only when a gift was received • Follow the then current Land Trust Alliance Tax Shelter Advisory 29 30 5

New Stewardship Requirements Land Conservation Project List • Fee Inspection reports include the following: ‒ Inspection date ‒ Property inspected ‒ Name of inspector ‒ Observations related to property’s condition and conservation values ‒ Observations related to any potential conservation easement violations or conservation property ownership challenges • Inspect fee properties annually • Monitoring or inspection reports completed promptly after monitoring or inspection event. 32 B02: Tackling Land Land Conservation Project List Trust Accreditation Requirements FRIDAY 1:30 PM – 3:00 PM Friday 1:30 pm – 3:00 pm Critical Application Needs Common Documentation Problems Lack of complete documentation (or missing) • Evidence an insider was absent for discussion •Take actions to meet and vote the requirement • Copy of notification sent to landowners about tax and appraisal issues •Document that you met • Documentation of review and approval of the requirement transactions • Information sent to board in advance of final •Communicate that you project approval met the requirement • Documentation of no private inurement or impermissible private benefit • Documentation that mortgages, liens and other encumbrances were addressed • Evidence that title was brought current at closing (30 days) 36 6