To qualify for consideration, the donation of property must meet one or more of the following criteria (Public Resources Code Section 37015):

1. The property will help meet the goals of a habitat conservation plan, multispecies conservation plan, natural community conservation plan, or any other similar plan subsequently authorized by statute that is designed to benefit native species of plants, including, but not limited to, protecting forests, old growth trees, or oak woodlands, and animals and development.



2. The property will provide corridors or reserves for native plants and wildlife that will help improve the recovery possibilities of listed species and increase the chances that the species will recover sufficiently to be eligible to be removed from the list, or will help avoid the listing of species pursuant to the California Endangered Species Act ("CESA") or the federal Endangered Species Act ("ESA"), or protect wetlands, waterfowl habitat, or river or stream corridors, or promote the biological viability of important California species.



3. The property interest is a perpetual conservation easement over agricultural land, or is a permanent contribution of agricultural land, that is threatened by development and is located in an unincorporated area certified by the secretary to be zoned for agricultural use by the county.   Property accepted pursuant to this criterion shall be accepted pursuant to the California Farmland Conservancy Program Act established by Section 10200 et seq. of the Public Resources Code, pursuant to the agricultural conservation program of the Coastal Conservancy, or pursuant to the Bay Area Conservancy Program established pursuant to Section 31160 et seq. of the Public Resources Code.



4. 1. The property interest is a water right, or land with an associated water right, and the contribution of the property will help improve the chances of recovery of a listed species, will reduce the likelihood that any species of fish or other aquatic organism will be listed pursuant to CESA or ESA, will improve the protection of listed species, or will improve the viability and health of fish species of economic importance to the state.   The donee receiving the water right, or land with an associated water right, shall ensure that it shall retain title to the water right, and that the water shall be used to fulfill the purposes for which the water right or land associated with a water right is being accepted.
      
      
   2. Any contribution of a water right that includes a change in the point of diversion, place of use, or purpose of use may be made only if the proposed change will not injure any legal user of the water involved and is made in accordance with either Section 1700 et seq. or Section 1725 et seq. of the Water Code.



5. The property will be used as a park or open space or will augment public access to or enjoyment of existing regional or local park, beach, or open-space facilities, or will preserve archaeological resources.

In addition to meeting one or more of the above criteria, the proposed donation must satisfy the requirements for a "qualified contribution" pursuant to section 170 of the Internal Revenue Code.   If only a portion (either an undivided fractional interest in the entire property or one or more discrete parcels) of a proposed conveyance of property satisfies the requirements for a "qualified contribution," or if the property is sold for less than fair market value, only that portion, or the amount representing the difference between the amount paid by the donee and the fair market value, shall be eligible for the tax credit, to the extent permitted by Internal Revenue Code section 170 (h).   The Board may segregate eligible and ineligible interests in property proposed to be contributed under the Tax Credit Act.   The donor must not receive any other valuable consideration for the donation of property subject to the tax credit.

If a property does not meet at least one of the criteria in Public Resources Code Section 37015, or does not satisfy the requirements for a "qualified contribution" under section 170 of the Internal Revenue Code, the donation is ineligible and cannot be considered for approval.   In addition, a donation will not qualify if it is proposed to satisfy a condition imposed upon the donor by any lease, permit, license, certificate, or other entitlement for use issued by one or more public agencies, including the mitigation of significant effects on the environment of a project pursuant to an approved environmental impact report or mitigated negative declaration required pursuant to the California Environmental Quality Act (Public Resources Code Section 37016).

Property on which there has been a release or threatened release of a hazardous material can be considered only if all of the requirements of Public Resources Code Section 37016 (a)(2) are met.   The application must disclose any known or suspected environmental conditions associated with the property.

Qualified property may be donated to any department, board or conservancy that is within the Resources Agency and authorized to hold title to land, or to the Resources Agency itself.   Eligible recipients also include local government agencies such as park and open space or other districts, cities, counties, cities and counties, and joint powers authorities made up of one or more of those entities or those entities and departments.   If bond funds are used to reimburse the General Fund, the local government must also be eligible to receive bond funds pursuant to the relevant provision of the applicable bond act.

A nonprofit organization is considered an eligible donee if it meets the following qualifications: (1) the nonprofit is a tax-exempt organization qualified under Internal Revenue Code section 501 (c)(3), (2) it has as a principal purpose the conservation of land and water resources, (3) the organization is designated by a department or local government to accept property under the Tax Credit Act in lieu of the department or local government, and (4) it has experience in land conservation.   Again, if bond funds are used to reimburse the General Fund, the nonprofit donee must also be eligible to receive bond funds pursuant to the relevant provision of the applicable bond act.

Applications are to be submitted first to the donee to which the donor proposes to contribute the property (NHPTCP Application Package – PDF).   Each donee must evaluate applications submitted to it.   Applications that the donee submits to the Board for consideration must include a plan that sets forth the donee's priorities for acquisition of property that qualifies under the Tax Credit Program.   Consistent with the program criteria, each donee may use its own priority lists and procedures in determining which properties or types of properties shall be given priority.

The Application Package contains four parts that must be completed by the donor and/or the donee.   In addition, further information may be requested by WCB as reasonably necessary to evaluate the proposed donation.   A complete application must include all of the following:

Part I
Project and Bond Information
Donor Disclosure Authorization
Donor Information


Part II
Criteria for Acceptance of Property


Part III
Donor and Donee Certifications


Part IV
Bond Fund Certifications
Certification of Availability of Funds
Required Attachments

A public hearing must be held in the local community before property is acquired under the Tax Credit Act, Public Resources Code Section 37012 (d).   When the Board has received both a complete application package for a proposed donation that appears to qualify for acceptance under the Tax Credit Program and a Department of General Services (DGS) approved fair market value for the donation, Board staff will notify the project proponent that a public hearing should be held.   For public hearings that the Board is required to conduct (i.e., where the donee is a designated nonprofit organization) the Board will seek staff services from the department that submitted the application, as provided in Public Resources Code Section 37005.   The public hearing must take place before the proposed donation will be presented to the Board for consideration of approval of a tax credit.

To avoid conducting a public hearing on a proposed donation that may not qualify for acceptance under the Tax Credit Program or for which funding may be unavailable, the public hearing should be held only after the application has been submitted to the Board and the project proponent has received notice to proceed with the public hearing from Board staff.   Whenever bond funds will be used to reimburse the General Fund for approved tax credits, it is critical the potential nonprofit organization coordinates with both the funding department or local government and the Board regarding the public hearing.

Notice of the public hearing must be provided to the following entities: County Board of Supervisors of the affected county; landowners adjacent to the property proposed for contribution; affected water districts; local municipalities; and others whom the donee or the Board determines to be interested in or affected by the donation.   Hearing notices must also be provided to the Board.   The hearing should be held at an appropriate public meeting facility such as a county court house or the chambers of the county board of supervisors.

The hearing notice shall be given and also made available on the internet at least 10 days in advance of the public hearing, and shall contain at least the following information:

1. Date, time, place, and location of hearing.

2. A specific agenda for the hearing, containing a brief description of the items to be discussed.

3. The name, address and telephone number of a contact person who can provide further information prior to the hearing.

4. The address of the internet site where the notice is available.

5. Information regarding how, to whom and by when a request for any disability-related modification or accommodation, including auxiliary aids or services may be made by a person with a disability who requires these aids or services in order to participate in the public hearing.

Upon request of a person with a disability, the notice shall be made available in appropriate alternative formats, as required by Section 202 of the Americans with Disabilities Act of 1990 (42 U.S.C. Section 12132), and the federal rules and regulations adopted in implementation thereof.

To assure the public hearing provides meaningful information, each hearing shall provide at least the following information:

• Identification of the donor, donee and any department or local government proposing to expend bond funds pursuant to the Tax Credit Act.

• Description of the proposed donation, including how the property meets the criteria and qualifies for acceptance under the Tax Credit Program.

• Location of the proposed donation, including maps that show the property boundaries and adjacent properties.

• If the proposed donation is a water right, or land with an associated water right, information with respect to how the water right will be used, how it meets the criteria and qualifies for acceptance under the program, any change in the point of diversion, place of use, or purpose of use, and any impact upon any legal user of the water.

• DGS approved, appraised fair market value of the property proposed for acceptance and amount of tax credit requested.

• Identification of impacts the donation may have on adjacent landowners.

• Actions taken or proposed to minimize any impact on adjacent landowners, including identification of any setbacks or buffers and how the size of each setback or buffer was established.

• Whether or not the donee will allow public access to the property, and if so, how public access will be managed.

• Any known or suspected environmental conditions associated with the property, including any release or threatened release of a hazardous material on the property.

• An opportunity for members of the public to comment on the proposed donation.

The donee shall record the hearing, prepare minutes and provide this information to the Board at least five weeks prior to the scheduled Board meeting.

The Tax Credit Act requires the donee to allow public access to any donated property to the extent that public access is consistent with the purposes for which the property was accepted.   However, before providing public access, the donee must develop a plan.   The plan shall address measures that will minimize the impact of public access on adjacent landowners and avoid any infringement on the customary husbandry practices on adjacent or nearby agricultural or timber operations.   In addition, the plan shall address any necessary setback or buffer area(s).   A conservation easement over privately owned lands may provide for public access, however, the Tax Credit Act does not require access to privately owned lands over which a conservation easement is contributed pursuant to the Tax Credit Program.

A donee accepting property under the Tax Credit Program is required to own and maintain a setback or buffer that may be necessary for the use of the donated property, in order to avoid infringement on the customary husbandry practices on adjacent or nearby agricultural or timber operations.

The Application Package, includes a "Disclosure Authorization" required by Public Resources Code Section 37034 (a)(3).   The Disclosure Authorization MUST BE SIGNED BY EACH DONOR.   No application can be accepted without the required Disclosure Authorization(s).

The Application Package also contains certifications that are required from the donor and the donee.   The certifications pertain to several requirements of the Tax Credit Act.

Certifications are required on the part of any department or local government that proposes to expend bond funds pursuant to the Tax Credit Program.   The required Bond Fund Certifications are contained in the Application Package.

The application must contain an appraisal of the fair market value of the property proposed for donation meeting the requirements of Internal Revenue Code section 170.   Before a donation of qualified property is presented to the Board for final approval, appraisal(s) must be reviewed and approved by the DGS.

To facilitate the development and ultimate approval of the appraisal and determination of the fair market value, all appraisals must be prepared in conformance with the Uniform Standards of Professional Appraisal Practice (USPAP).   In addition, the application must contain the appraiser's certification described in the lists of Required Attachments in the Application Package.

If the application is complete and appears to qualify for acceptance under the program, Board staff will notify the state agency to submit the appraisal to the DGS for review.   Once the DGS review is complete, the department must send Board staff a copy of the DGS Appraisal Review Memorandum.   The project will be scheduled for full Board review and consideration following receipt of the DGS approved fair market value of the donation and completion of the public hearing.

A department may accept contributions of money from any taxpayer to pay or reimburse the costs of appraisal, escrow, title and other transaction costs associated with the contribution of any particular property or set of properties, including any environmental site assessments the department requires, and the costs of preparing any necessary management plan for the property or set of properties.