February 5, 2018|By Caitlin Guthrie| Finance
Do you think debt is a useful tool to create a better life for you and your family? Home loans, business loans and student loans can all serve a place in helping us reach our personal goals. Consider this: how long would you need to save up to purchase a home if you had to pay for it in one lump sum? And if you are fortunate enough to be able to do just that—is it the best use of your funds? The reality is, most Americans can’t wait 30 years to buy a home with an all-cash purchase.

The key is sustainable debt—the financial bridge that allows us to invest in our future, without putting undue pressure on our present budget.

Now you may ask: what does debt have to do with conservation? Many communities and conservation organizations face pressing deadlines to protect important natural areas. Very often, they don’t have decades to spare to raise the funds needed to protect places valued for their unique natural, habitat, or historic qualities. For a house, it’s likely that it will still be standing after 30 years. But for many of the unprotected precious places where we (and our children and grandchildren) play, explore and dream, they will likely be gone in thirty years if immediate action is not taken when the opportunity arises.

ConnValleyWith some of the best farmland anywhere and historic properties throughout the region, the Connecticut River Valley is unique. We’ve helped Franklin Land Trust conserve over 1,700 acres in this rapidly developing area. Photo by Reggie Hall. 

We founded our Conservation Loans program in 1993 to address this dilemma. We often heard a variation of: “we need a partner who understands our local conservation and community priorities—a partner who can swiftly provide flexible financing, so that we can seize opportunities to protect the places that matter the most.”

Twenty-five years on, our Conservation Loans program has provided $200 million in 350 loans to more than 150 partners. These groups have used our bridge funding to protect over 140,000 acres across the United States and Canada, and the need for ready conservation capital continues to grow. Our funds are “revolving,” meaning that once our loans are repaid, we reinvest the dollars in other conservation projects as soon as possible.

Over nearly three decades of providing nonprofit and municipal loans, we’ve learned many lessons. Prominent among them is that Americans' often-conflicted attitudes about personal debt can influence decision-making in the public sphere, which includes conservation nonprofit organizations. About half of conservation groups have not borrowed funds to finance a conservation project, and one of the top reasons given is low risk tolerance on the part of their Board of Directors and senior leadership (The Conservation Fund’s Bridge Financing Survey, 2017, 122 participating organizations). Our survey found that these board members don’t see debt as an available and/or necessary tool to reach organizational goals.

Why is this? We have found that conservation nonprofit Board members, who are fiscally and legally responsible for the organization they helm, are making decisions with the weight of perpetuity hanging over them. The risk-benefit analysis frankly feels different when they commit to ensure that the lands the organization protects will provide public benefit forever. These are reasonable and responsible decisions.

This is one of the reasons why our Conservation Loans program provides much more than simple bridge financing. First, our vetting process is comprehensive and rigorous, while moving quickly to meet our partners’ needs. Second, our loans come with expert technical assistance. As a practitioner, as well as a lender, we help loan recipients with real estate and fundraising guidance, outreach to government officials, and one-on-one coaching to build organizational capacity.

Your success is our success, and your failure is our failure. We believe that this engagement has resulted in a default rate on our loans of 0.003. Our partners don’t accept failure as an option and neither do we, especially when so much is on the line.

Many nonprofit and public-sector conservation organizations are adapting the tools of the financial marketplace (tools that we use for business and personal success every day) to proactively protect the parks, natural areas, forests, farms and trails that create the quality of life we love, for the benefit of all. These non-profit and public-sector innovators recognize that urgent conservation and community priorities often cannot wait for funding to become available.

For example, when a group of Oakley, Utah, residents approached Summit Land Conservancy with an idea to work with private landowners to protect public access to the Weber River, the Conservancy was all ears. Local citizens had worked for years developing a plan to build a public trail along the riverbank, to connect the town with public trails on U.S. Forest Service land leading into the nearby Uinta Mountains.

2 5 Summit Land Conservancy photo by Charlie LanschePhoto of Weber River by Charlie Lansche.

Summit Land Conservancy embraced this vision of community conservation, and when 23 acres with a half-mile of river frontage came on the open market, the Conservancy seized the opportunity. The site was a cornerstone property that would help ensure the lower section of the trail would be possible; however, Summit Land Conservancy didn’t have the funding in hand to make a viable offer. The Conservation Fund helped ensure the Conservancy’s success by providing bridge financing for two years, allowing the group to purchase the land as a City of Oakley park while simultaneously implementing a funding strategy.

“A loan from The Conservation Fund allowed us to purchase land that had previously been under contract to developers. In addition to providing the necessary funding, The Conservation Fund’s staff gave us great advice on the structure of our capital campaign.”
– Cheryl Fox, Executive Director, Summit Land Conservancy

Our partners are creative innovators in community conservation–not only do they use bridge funding and debt to conserve land for public access, wildlife, recreation, food security and more – they install farmers markets, transform railroad corridors into trail networks, heal nature, create sustainable jobs and build parks. This is what I consider to be true community wealth.

Our mission is to help accelerate the pace of conservation in your community. Do you have a conservation dream? We don’t have the time to spare. The sky’s the limit on what we can accomplish together, so let’s make it a reality before it’s too late.

Click Through the Gallery below to find out more about Conservation Loans' partners: