As anyone who’s been associated with a charitable organization can attest to, receiving donations is a welcome and somewhat rare surprise. Donations are an encouraging show of support that allows the organization’s professionals to continue their work, and the organization itself to continue to pursue its goals.
Accordingly, in the rare instances where charitable organizations receive large land donations, the immediate reaction is typically one of joy – given the financial and logistical byproducts of such generosity. The subsequent reaction is often one of mild nervousness, however, as there are some important considerations to review and understand in regards to land donations – preferably before one of these donations is accepted.
The good news is that once you adapt to these factors, land donations are easy to take advantage of, and are sure to provide charities with many valuable benefits.
To help any charitable organization that’s thinking of accepting a large land donation, let’s take a look at some factors to consider before doing so!
The following tip is intended for charitable organizations that plan to use donated land in their own organization, as opposed to selling it to another party outright.
Receiving an extra 50 acres of land to use for charitable purposes is awesome, but what of the staff required to carry out an organization’s practices and work towards its goals on this land? Bluntly stated, many charities rush to accept land donations without considering the staffing implications of such a decision. To be sure, even maintaining land – before it’s built on or used for any significant cause – requires ample support.
Needless to say, charities should set aside the staff required to maintain any land that’s been donated before accepting such a contribution. They should obtain even more staff to operate any additional charitable components that are planned for this land, including new buildings and branches.
First, we’ll take a look at some of the potential construction and maintenance costs associated with donated land that’ll be kept and used by a charitable organization.
As every homeowner knows, land isn’t cheap to buy, keep up, or even live on. Moreover, the costs of maintaining land, building on land, and operating structures on land is significant to say the least. Thus, many charities and nonprofits are surprised to find that “donated” land ends up requiring a substantial amount of money to cultivate and put to use.
To assure that donated land doesn’t become a major financial burden to any charity, it’s imperative that the professionals responsible for accepting or passing on said donation meet with a financial expert beforehand to explore the long-term costs associated with owning the property. This consultation will require some type of upfront payment, but the financial benefits – including possibly saving a tremendous amount of cash later on – are invaluable. Generally speaking, the “background” costs of maintaining land – including landscaping, natural disaster response, waste removal, and more – prove more costly than anticipated.
Furthermore, the charitable professionals responsible for determining the potential uses of land should consult with construction experts to see roughly how much it would cost to erect the desired building(s). Nearly every parcel of donated land will need at least one building to be built on it, or repaired. In some instances, the cost of repairing and modifying an existing building (especially when it doesn’t currently suit an organization’s wants and needs) will near that of constructing a new one.
For especially careful charitable professionals, it might also be worth meeting with energy experts at local electricity and natural gas companies to see what the cost of power on a piece of donated land will be (general construction blueprints must be drafted beforehand). Like the aforementioned land-maintenance expenditures – electricity and other forms of energy often cost more than one would think.
Now let’s take a brief look at what costs charities and nonprofits that plan to sell a donated piece of land may have to account for.
The scope of these potential costs is much smaller than that of modifying and using a land donation, but charity professionals would nevertheless do well to plan for them.
Land that will be sold may need to be landscaped and otherwise cultivated, and any structures it contains may need to be repaired. Unsightly land and homes fetch far lower prices on the open market. In some rare cases, such properties require months or even years to sell – a costly process in terms of realtor fees.
From start to finish, the process of accepting a land donation can be taxing. It involves reviewing and recording its condition, meeting with professionals (realtors if the land will be sold, and construction experts if it will be used), selling it or beginning its construction, and assuring that all these things happen without issue. Furthermore, the process needs to be handled by a project manager – someone who is reliable, qualified, and willing to operate according to the wishes of the charity’s executives.
It’s important that a competent project manager or management team be selected and consulted before a land donation is accepted, to assure that the land is as valuable and useful to its recipient charity as possible.
These tips are sure to help any charity or nonprofit that’s considering accepting a land donation. As was initially stated, there are more factors to contemplate before accepting such a generous offering than most individuals realize, but once these factors are weighed and handled, the financial and operational benefits of the donation are sure to be significant.
Thanks for reading, and thank you to all the caring individuals and organizations that donate land, as well as the top-notch groups that put this land to good use!