A Seed Springs to Light by Story Clark
© Chaffin/Light Spring Island, SC
Conservation-minded developers were likely the first to use transfer fees and to use them successfully. A developer in South Carolina created what may be the earliest programs, adapting them from the model of early, publicly levied real estate transfer taxes. (Some government agencies tax land transfers to generate revenue for public programs.)
A Seed Springs to Light
In 1989, Jim Light and his partner, James Chaffin, of Chaffin/Light Associates, instituted a private transfer “assessment” at their Spring Island luxury development in South Carolina. This 3,000-acre development includes 1,200 acres of nature preserves and open space with live oak forests, marsh, and waterways that lie on a protected island on the Atlantic coast northwest of Hilton Head Island.
The development’s transfer fee funds the Spring Island Trust, which the developers created to manage the conservation land and easements on Spring Island. The fee also funds the Low Country Institute, which offers educational conservation programs to the surrounding communities. Over the first ten years of sales, the 410 lots in the development generated a substantial $3 million from a 1.5 percent fee on all transfers of unimproved lots and a 1 percent fee on improved lots.
Replicating Success
Chaffin/Light Associates has continued to use the transfer fee for land and easement stewardship and conservation programs in their other developments. Since conservation is a prominent feature of their communities, fee-for-conservation programs have been well received by lot owners.
If there are no local land trusts working in the vicinity of their developments, Chaffin/Light Associates creates them or less independent 501(c)(4) supporting organizations to steward the development’s own easements, manage other conservation programs, and undertake conservation outreach within the development and the surrounding communities. The Spring Island Trust, for example, manages specific habitats on Spring Island in addition to stewarding the conserved land.
The transfer fee percentages in the Chaffin/Light developments have ranged from 0.5 to 2 percent of gross sales depending on the scope of the conservation programs, the stewardship requirements, and the scale of the development. The company’s Colorado development, the Roaring Fork Club, has a transfer fee on sales of its sixty cabins and suites and on its five hundred club memberships. The proceeds fund the general operations of Roaring Fork Conservancy, which predated the development, and which include river conservation, environmental education, and watershed research. The conservancy requests additional cash stewardship gifts when it accepts donated conservation easements.
Transferring the Transfer Fee Model
Excerpted from A Field Guide to Conservation Finance, by Story Clark. Copyright © 2007 Island Press. Reproduced by permission of Island Press, Washington, D.C.
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