Potential Donors

What is a facade easement?

A facade preservation easement is a legally enforceable commitment by a property owner to preserve the facade of a particular historically significant structure so that its exterior architectural features remain unchanged forever. After accepting an easement donation, Easements Atlanta, Inc. (EAI) enforces the agreement by the property owner to preserve the facade of the building and public views of the same.

Why should I donate a facade easement?

Through the gift of a preservation easement the owner of an historic property, listed on the National Register of Historic Places or a contributing property in a National Register listed historic district, can have the satisfaction of knowing that the property will be preserved as part of Atlanta's architectural heritage for future generations to enjoy. Such an easement insures a property's preservation more effectively than zoning or historic designation.

In addition to public benefit and personal satisfaction, the donation of a facade easement may bring the donor income tax savings. Qualified gifts allow donors to take federal and state income tax deductions, and may cause reductions in federal estate taxes and local property taxes. The amount of deduction obtained is the difference between the appraised fair-market value of the property before and after the easement restriction.

In some cases, heirs benefit from an easement donation because the gift lowers the value of the estate and the estate taxes. Taxes on gifts of property could also be less if the property is encumbered by a preservation easement. Additionally, the property tax assessment of an easement-restricted historic structure could be reduced from the pre-easement assessment. The reduction, if any, would depend upon state law and attitudes of local officials and assessors.

In any case, the potential donor should always consult his or her tax attorney and/or accountant before beginning the application process.

What should I consider before deciding to donate?

Easement donors should be prepared for several things prior to completion of their donation.

1. Maintenance and Alterations

Owners will be responsible for upkeep and maintenance to the building at all times. Once a year, Easements Atlanta will conduct an inspection. Most repairs are allowed to be completed within a year or before the next inspection, whichever comes first. Owners must have any planned alterations pre-approved as well.

2. Legal and Financial Considerations

Easement donors must discuss prospective tax benefits and questions with their attorney or accountant. Prospective donor should also contact Easements Atlanta for a copy of the standard deed of agreement to study early in the process so that necessary clarifications or alterations can be worked out.

3. Costs of Application and Donation

Costs the owner/donor can expect to incur in the application/donation process are:
- a $1,500 nonrefundable application fee submitted at the time of the application, which includes an architectural review, legal fees, and administrative costs;
- an easement donation fee: equals 2% of the value of the facade easement;
a property appraisal fee: varies depending upon size, use and location of the property, and may range from $1,000 to $30,000;
- photographs: includes a set of prints, another set copied onto bond paper, and a CD if available;
- a survey fee: if required, may range from about $800 for a residential property under an acre, on up.;
- preservation consultant fee: if the property is not on the National Register of Historic Places, the owner may hire an expert to prepare the documentation for historic certification, fees may run an average of $8,000;
- tax consultant fee: owners are strong recommended to consult a tax expert early in the donation process;
- deed recording fee: approximately $50 depending on the length of the document;
- end-of-year fees: an additional 10% on the donation fee is charged for applications received after October 1; 15% is charged for those submitted after November 1; 25% after December 1; and 50% after December 15.

What is the donation process?

1. Investigation

Learn as much as you can about facade easements from this website; contact Easements Atlanta, your accountant or other tax expert. You should contact the various experts you will need - an appraiser, a surveyor, and possibly a preservation consultant - before you make this decision.

The owner/donor, and/or attorney for same should contact Jim Rollins at Holland & Knight, LLP for a copy of the standard deed of agreement to study early in the process so that necessary clarifications or alterations can be worked out with the EAI attorney.

2. Application

Applications consist of:
- a completed Application Form (Microsoft Word or PDF) and $1000 non-refundable fee;
- black and white and color photographs showing all sides of the building, significant features, and site (either prints or a disk);
- site plan of the property with photographs keyed to it;
- architectural plans for rehabilitation, if applicable;
- landscape plan of the property, if applicable;
- letter(s) from lending institutions and appropriate owners stating their position on the facade easement; and
- a copy of historic certification from the Historic Preservation Division;

3. Architectural Review

Easements Atlanta performs an on-site inspection of the property to determine its eligibility and condition. Any repairs that are needed before approval are identified and reported to the owner.

4. Board Review

The board of Easements Atlanta will consider the application and either accept it, accept it conditionally, or reject it. The board meets annually in December and during the year as needs arise.

5. Closing

If EAI's executive committee determines to accept the application, the donor must obtain the following items for EAI's files before a deed of agreement is signed:
- recordable Subordination Agreement (Microsoft Word or PDF) from the mortgage holder(s);
- copy of the title insurance policy;
- copy of the property insurance naming EAI an additional insured;
- copy of the appraisal;
- plat of the property; and
- black and white photographs of each facade and any improvements, photocopied onto bond paper.

The Deed of Agreement (Microsoft Word or PDF) describes the obligations of the property owner and Easements Atlanta under the deed. Exhibits include:
- a legal description of the burdened property;
- color and black-and-white photographs (as approved by Easements Atlanta, Inc.) of all of the exterior surfaces of the improvements, photocopied onto bond paper; and
- permitted exceptions (i.e. title exceptions not subordinated to the conservation easement).

For corporations, partnerships, or limited liability companies, the following grantor authorization documents are required:
- a certificate of existence;
- a resolution or other action of shareholders/members/directors/partners necessary to authorize grant of easement with a copy of organizational documents attached; and
- an incumbency certificate or other evidence of authority of signatories.

After these documents are submitted to Easements Atlanta, the two parties sign a Deed of Agreement, and at that time, the donor pays Easements Atlanta the easement donation fee (2% of the easement value). The owner is then responsible for having the deed of agreement recorded.

When the deed, with accompanying exhibits, has been signed, the donor will pay EAI the easement donation fee, which is 2% of the value of the facade easement as determined by a qualified appraiser. This must be paid at the time of recording. The fee is required to ensure easement enforcement in perpetuity. The owner is responsible for recording the document after it is signed, at a cost of approximately $50 depending upon the length of the deed.

The Closing Checklist (Microsoft Word and PDF) lists the required documents and deed exhibits in greater detail.

What documents will I need to complete?

All of these documents are referenced above, but listed here for your convenience:
- Application Form: Microsoft Word or PDF
- Closing Checklist: Microsoft Word or PDF
- Deed of Agreement: Microsoft Word or PDF
- Subordination Agreement: Microsoft Word or PDF