Case: 18-14817 Date Filed: 05/13/2020 Page: 1 of 22
[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT _______________________
No. 18-14817 ________________________
Agency No. 4868-15
CHAMPIONS RETREAT GOLF FOUNDERS, LLC, RIVERWOOD LAND, LLC, TAX MATTERS PARTNER,
Petitioners - Appellants, versus
COMMISSIONER OF IRS,
Respondent -Appellee.
________________________
Petition for Review of a Decision of the U.S. Tax Court ________________________
(May 13, 2020)
Before WILSON and GRANT, Circuit Judges, and HINKLE,* District Judge.
* Honorable Robert L. Hinkle, United States District Judge for the Northern District of Florida, sitting by designation. Case: 18-14817 Date Filed: 05/13/2020 Page: 2 of 22
HINKLE, District Judge:
The appellant taxpayer claimed a charitable deduction for donating a
conservation easement over property that included a private golf course and
undeveloped land. The Commissioner of Internal Revenue disallowed the
deduction, and the Tax Court upheld the decision. The deduction was proper if the
donation was made for “the protection of a relatively natural habitat of fish,
wildlife, or plants, or similar ecosystem,” or was made for “the preservation of
open space . . . for the scenic enjoyment of the general public.” I.R.C.
§ 170(h)(4)(A)(ii) & (iii)(I).
Without the golf course, this easement would easily meet these criteria.
Because the Code does not disqualify an easement just because it includes a golf
course, we reverse the Tax Court’s decision and remand for determination of the
proper amount of the deduction.
I. Facts and Proceedings
Pollard Land Company bought over 2,000 undeveloped acres along the
Savannah River roughly 13 miles north of Augusta, Georgia. In 2002, Pollard
conveyed part of the land, 463 acres, to the taxpayer in this action, Champions
Retreat Golf Founders, LLC (“Champions”). Champions built a golf course with
three nines—one each designed by Gary Player, Jack Nicklaus, and Arnold
2 Case: 18-14817 Date Filed: 05/13/2020 Page: 3 of 22
Palmer. The course opened for play in 2005. It was and still is private—open only
to club members and their guests, not the general public.
The golf course occupies roughly two-thirds of the 463 acres. Champions
sold 66 homesites on 95 acres on the west side of the course—the side away from
the Savannah River. The golf course and homesites are accessible only through a
gate that is staffed 24 hours per day.
Roughly 57 acres, consisting primarily of bottomland forests and wetlands,
remain undeveloped. This includes riparian land on the Little River, an offshoot of
the larger Savannah. Between the Little and Savannah Rivers lies Germain Island.
The island consists of both undeveloped land and six holes of the golf course.
The easement property is home to abundant species of birds, some rare, to
the regionally declining southern fox squirrel, and to a rare plant species, the
denseflower knotweed. Although not itself accessible to the public, the property is
readily observable to members of the public who kayak or canoe on the Savannah
and Little Rivers.
By 2009, the Champions golf course, like many in the ongoing recession,
was struggling financially. Aware of the Tax Court’s recent decision allowing a
charitable deduction for a conservation easement over golf course property, see
Kiva Dunes Conservation, LLC v. Commissioner, T.C. Memo. 2009-145 (2009),
Champions contributed the conservation easement now at issue to the North
3 Case: 18-14817 Date Filed: 05/13/2020 Page: 4 of 22
American Land Trust (“the Trust”) in 2010. The Trust is an entity that holds and
enforces conservation easements nationwide with the goal of preserving natural
habitats and environmentally sensitive areas. The Trust accepted the easement.
The easement covers 348 acres consisting of the undeveloped land and the
golf course, including the driving range, but not including the golf course buildings
and parking lot. The easement does not include the homesites.
Champions claimed a charitable deduction for the contribution. As a limited
liability company, Champions was able to steer the corresponding tax benefit to
persons who, in anticipation of that benefit, made capital contributions, thus
shoring up Champions’ financial position. But the Commissioner of Internal
Revenue disallowed the deduction. Champions and a related entity filed this action
in the Tax Court against the Commissioner. After a trial, the Tax Court upheld the
Commissioner’s decision. This appeal followed.
II. Standard of Review
We review the Tax Court’s legal conclusions de novo and its factual
findings for clear error. See Gustashaw v. Comm’r, 696 F.3d 1124, 1134 (11th Cir.
2012). “A finding of fact is clearly erroneous if the record lacks substantial
evidence to support it, such that our review of the entire evidence leaves us with
the definite and firm conviction that a mistake has been committed.” Blohm v.
4 Case: 18-14817 Date Filed: 05/13/2020 Page: 5 of 22
Comm’r, 994 F.2d 1542, 1548 (11th Cir. 1993) (internal citations and quotation
marks omitted).
III. Governing Code Provisions
The Internal Revenue Code allows a deduction for a “qualified conservation
contribution.” See I.R.C. § 170(f)(3)(B)(iii). A “qualified conservation
contribution” is a contribution “(A) of a qualified real property interest, (B) to a
qualified organization, (C) exclusively for conservation purposes.” Id. § 170(h)(1).
A “qualified real property interest” includes “a restriction (granted in
perpetuity) on the use which may be made of the real property.” Id. § 170(h)(2).
The easement Champions conveyed to the Trust meets this requirement; it restricts
use of the property in substantial respects and continues in perpetuity. The
Commissioner does not contest this.
The Trust is “a qualified organization.” See id. § 170(h)(3) (defining this
term). The Commissioner does not contest this.
This leaves only one issue: whether this contribution was made “exclusively
for conservation purposes.” The Code defines “conservation purpose” to mean:
(i) the preservation of land areas for outdoor recreation by, or the education of, the general public,
(ii) the protection of a relatively natural habitat of fish, wildlife, or plants, or similar ecosystem,
(iii) the preservation of open space (including farmland and forest land) where such preservation is-- 5 Case: 18-14817 Date Filed: 05/13/2020 Page: 6 of 22
(I) for the scenic enjoyment of the general public, or
(II) pursuant to a clearly delineated Federal, State, or local governmental conservation policy,
and will yield a significant public benefit, or
(iv) the preservation of an historically important land area or a certified historic structure.
Id. § 170(h)(4)(A) (emphasis added).
This case turns on the italicized provisions. The other provisions do not
apply. The land is not available for recreation by or use of the general public.
There is no qualifying federal, state, or local government conservation policy that
applies to this land; that the county designated the land as greenspace is not
enough. This is not historically important land, and there is no certified historic
structure on it.
The issues, then, are whether Champions contributed this easement for “the
protection of a relatively natural habitat of fish, wildlife, or plants, or similar
ecosystem,” or for “the preservation of open space . . . for the scenic enjoyment of
the general public [that] will yield a significant public benefit.”
IV. Habitat or Ecosystem
A. The Regulation
The Internal Revenue Code explicitly requires deductions for charitable
contributions—including those for conservation easements—to meet regulations 6 Case: 18-14817 Date Filed: 05/13/2020 Page: 7 of 22
adopted by the Secretary of the Treasury. See I.R.C. § 170(a)(1). The regulation
governing conservation easements is 26 C.F.R. § 1.170A-14. The regulation makes
more explicit what one might reasonably construe the Code to mean anyway.
The regulation says a contribution “to protect a significant relatively natural
habitat in which a fish, wildlife, or plant community, or similar ecosystem
normally lives” will meet the Code’s conservation-purpose requirement.
Id. § 1.170A-14(d)(3)(i). For the first time on appeal, Champions takes issue with
the word “significant,” asserting this impermissibly departs from the requirement
set out in the Code itself. But even without the regulation, the Code would not be
construed to apply to a completely trivial habitat—a few commonly occurring ants
plainly would not do, nor would many other species not in need of conservation.
Requiring some level of significance thus is unobjectionable. So long as the
regulation’s use of this term is not construed to mean more than the Code will
support, there is no reason to doubt the regulation’s validity. Perhaps this is why
the regulation has been applied for many years without any challenge to its
validity, and why even Champions did not raise this issue in the Tax Court.
The regulation says qualifying significant habitats and ecosystems “include,
but are not limited to,” those of three kinds. Two are relevant here.
First are “habitats for rare, endangered, or threatened species of animal, fish,
or plants.” Id. § 1.170A-14(d)(3)(ii). Neither the Tax Court nor the parties assert
7 Case: 18-14817 Date Filed: 05/13/2020 Page: 8 of 22
that “rare,” “endangered,” and “threatened” have, for this purpose, a precise,
technical meaning; instead, the terms distinguish species that reasonably warrant
protection, on the one hand, from commonly occurring species for which the loss
of habitat is not of significant concern. That the regulation explicitly says
qualifying habitats are “not limited to” the listed categories supports this flexible
reading.
Second are “natural areas which are included in, or which contribute to, the
ecological viability of a local, state, or national park, nature preserve, wildlife
refuge, wilderness area, or other similar conservation area.” Id. The Champions
easement runs to the bank of the Savannah River, and on the other side, 700 feet
away, is a large national forest.
The third category listed in the regulation covers “natural areas that
represent high quality examples of a terrestrial community or aquatic community,
such as islands that are undeveloped or not intensely developed where the coastal
ecosystem is relatively intact.” Id. As Champions acknowledges, this provision
does not apply here.
The upshot is this. The Code allows a deduction for an easement contributed
for “the protection of a relatively natural habitat of fish, wildlife, or plants, or
similar ecosystem.” Under this provision and the implementing regulation,
Champions is entitled to a deduction if its easement includes habitat for “rare,
8 Case: 18-14817 Date Filed: 05/13/2020 Page: 9 of 22
endangered, or threatened species of animal, fish, or plants,” or if the easement
contributes to the “ecological viability” of the adjacent national forest.
These are the standards that apply despite the presence of a golf course on
part of the property. The Code requires only a “relatively natural habitat . . . or
similar ecosystem,” not that the land itself be relatively natural. I.R.C.
§ 170(h)(4)(A)(ii). The regulation, in turn, says a deduction is available even if the
land “has been altered to some extent by human activity,” so long as “the fish,
wildlife, or plants continue to exist there in a relatively natural state.” 26 C.F.R.
§ 1.170A-14(d)(3)(i). The regulation gives as an example the construction of a dam
or dike and resulting lake or pond, but neither the Code nor the regulation excludes
otherwise-qualifying property with alterations, including, as relevant here, a golf
course. Kiva Dunes is of limited precedential value—the Commissioner did not
oppose the deduction there—but it is consistent, at least, with the view that
conservation easements across golf courses qualify for a deduction if they meet the
otherwise-applicable standards. See also PBBM-Rose Hill, Ltd. v. Comm’r, 900
F.3d 193, 204–05, 209 (5th Cir. 2018) (holding that an easement over a golf course
served a conservation purpose but was not deductible because it was not made in
perpetuity).
B. Rare, Endangered, or Threatened Species
9 Case: 18-14817 Date Filed: 05/13/2020 Page: 10 of 22
The record establishes without genuine dispute that this property is home to
abundant species of birds, some rare, to the regionally declining southern fox
squirrel, and to a rare plant species, the denseflower knotweed. This is established
by the testimony of three experts—two called by Champions and one by the
Commissioner—who generally agreed on the underlying facts. The Tax Court
explicitly credited the testimony of all three.
One expert observed 61 species of birds on the property, including 26 that
are listed as a priority by one or more conservation organizations. These included
the eastern whip-poor-will, brown-headed nuthatch, red-headed woodpecker, and
prothonotary warbler. The expert saw a wood duck with fledglings, suggesting on-
site breeding. The Commissioner’s expert saw a wood stork—a federally listed
endangered species—though he opined it was just passing through.
The parties have analyzed in detail the placement of the various bird species
on conservation priority lists compiled by organizations with expertise in this field.
Of critical importance here, though, is not precisely which bird ranks precisely
where on one or more of these lists, but the more general question whether the
presence of these many species, including some of substantial conservation
concern, shows that the property is a significant habitat for “rare, endangered, or
threatened species.” It plainly does.
10 Case: 18-14817 Date Filed: 05/13/2020 Page: 11 of 22
For what it’s worth, the priority lists were compiled by Partners In Flight
(“PIF”), the Atlantic Coast Joint Venture (“ACJV”), the United States North
American Conservation Initiative Committee (whose list is denominated and
referred to here as the “Watch List”), and the United States Fish and Wildlife
Service (whose list is denominated and referred to here as “Birds of Conservation
Concern”). The priority designations of the property’s various birds include the
following: eastern whip-poor-will (ACJV highest priority level, PIF needing
management attention, Watch List yellow, Fish and Wildlife Service Birds of
Conservation Concern), brown-headed nuthatch (ACJV high priority, PIF planning
and responsibility, Fish and Wildlife Service Birds of Conservation Concern), red-
headed woodpecker (ACJV moderate, PIF planning and responsibility, Watch List
yellow), prothonotary warbler (ACJV moderate, PIF planning and responsibility,
Watch List yellow), eastern wood pe-wee (ACJV moderate, PIF management
attention), Carolina chickadee (ACJV moderate, PIF planning and responsibility),
eastern kingbird (ACJV moderate, PIF management attention), yellow-billed
cuckoo (ACJV moderate, PIF management attention), Acadian flycatcher (ACJV
moderate, PIF planning and responsibility), blue grosbeak (ACJV moderate, PIF
planning and responsibility), brown thrasher (ACJV moderate, PIF planning and
responsibility), indigo bunting (ACJV moderate, PIF planning and responsibility),
barn swallow (PIF management attention), belting kingfisher (PIF management
11 Case: 18-14817 Date Filed: 05/13/2020 Page: 12 of 22
attention), northern flicker (PIF management attention), blue-gray gnatcatcher (PIF
planning and responsibility), Carolina wren (PIF planning and responsibility),
downy woodpecker (PIF planning and responsibility), eastern bluebird (PIF
planning and responsibility), pine warbler (PIF planning and responsibility), red-
bellied woodpecker (PIF planning and responsibility), ruby-throated hummingbird
(PIF planning and responsibility), tufted titmouse (PIF planning and
responsibility), yellow-throated vireo (PIF planning and responsibility), and
eastern Phoebe (PIF planning and responsibility).
The Commissioner’s expert takes no issue with the proposition that many
birds use the property including some that are worthy of protection. He says,
though, that the habitat itself is not relatively natural. For this he focuses on the
fairways and greens—they consist of non-native bermuda and bent grass—not the
undeveloped portion of the easement, which is, at least for the most part, quite
natural.
What matters under the Code and regulation is not so much whether all the
land is natural, but whether the habitat is natural. Indeed, the regulation says it is
not disqualifying that the land has been altered, so long as “the fish, wildlife, or
plants continue to exist there in a relatively natural state.” 26 C.F.R. § 1.170A-
14(d)(3)(i). The Commissioner’s expert noted nothing unnatural about these birds’
existence; they apparently find the habitat quite suitable.
12 Case: 18-14817 Date Filed: 05/13/2020 Page: 13 of 22
Champions also cites the property’s population of southern fox squirrels—a
species for which the habitat, including the golf course, is hospitable. The species
is not threatened but has suffered declines caused by diminishing habitat, due in
part to forest-management practices. The Commissioner discounts the importance
of the species, noting that Georgia has a six-month season in which hunters may
take up to 12 squirrels per day. But that is not dispositive of the question whether
providing the squirrels a habitat is a conservation purpose. That Georgia chooses
not to protect the species hardly seems a reason to deny whatever protection is
available under federal law. Protecting fox squirrels would not alone be sufficient
to establish a conservation purpose, but they add to the weight on Champions’ side
of the scale.
Finally, while the golf course itself is comprised primarily of non-native
grasses, the remainder of the easement property is natural and includes a rare
species of plant, the denseflower knotweed. The Commissioner has offered no
theory under which protecting the denseflower knotweed is not an appropriate
conservation purpose.
It is true, as the Commissioner notes, that the knotweed exists on only a
limited proportion of the easement—perhaps 7%, with the capacity to occupy up to
17%. But the knotweed that exists, whatever its proportion, is worthy of protection.
Full coverage of a species is not required and might even cut the other way; one
13 Case: 18-14817 Date Filed: 05/13/2020 Page: 14 of 22
might reasonably doubt that land consisting entirely of knotweed would provide a
relatively natural habitat or would support the many bird species present on this
land.
The Commissioner also says part of the golf course drains toward the
bottomland where the knotweed is located and that the knotweed thus may suffer
harm from the chemicals used on the course. Perhaps so. But the easement
explicitly requires Champions to follow the best environmental practices prevailing
in the golf industry—an obligation the Trust is entitled to enforce. Moreover, the
relevant question is not so much whether chemicals from the course may harm the
knotweed, but whether the easement improves the chance that the knotweed will be
preserved. The answer is yes for two reasons: first, because the obligation to use
best environmental practices would not exist without the easement; and second,
because unrestrained development of the land where the knotweed is located would
pose a greater risk than the golf course.
Despite the abundant bird species, including many of conservation concern,
the declining southern fox squirrels, and the rare denseflower knotweed, the Tax
Court said Champions had not established the required conservation purpose. To
reach this result, the court considered, or at least discussed in its opinion, only
birds seen by both Champions experts—ignoring any bird seen by only one
Champions expert, even if the bird was also seen by the Commissioner’s expert.
14 Case: 18-14817 Date Filed: 05/13/2020 Page: 15 of 22
The court did this despite explicitly crediting the testimony of both Champions
experts. The court offered no explanation for this approach, and we can conceive
of none.
The court also ignored a bird that was heard but not seen. The court did not
explain how a bird could be heard if not present on or at least near the property.
The Tax Court’s implicit finding that the only birds on the property were
those seen by both Champions experts is clearly erroneous. More importantly, the
Tax Court’s conclusion that Champions did not contribute this easement “for the
protection of a relatively natural habitat of fish, wildlife, or plants, or similar
ecosystem”—a conclusion based in part on the clearly erroneous finding of fact—
is wrong as a matter of law.
Were it not for the presence of a golf course on part of this property, the
assertion that contributing an easement over property with this array of species
does not qualify as a conservation purpose would be a nonstarter.
C. Support of the National Forest
The easement lies across the Savannah River from a large national forest.
The river is 700 feet wide. Birds sometimes fly farther than that. Champions
asserts the easement “contributes to . . . the ecological viability” of the forest—an
assertion that, if true, would show a conservation purpose. But the Commissioner’s
15 Case: 18-14817 Date Filed: 05/13/2020 Page: 16 of 22
expert testified, and the Tax Court found, that the easement does not support the
forest’s ecological viability. The finding is not clearly erroneous.
The presence of the national forest across the river is relevant—it supports
the species that live on the easement, as the Commissioner’s expert acknowledges,
and it contributes to the scenic enjoyment from, and public interest in, preventing
development of the easement property. But contributing to the ecological viability
of the forest, standing alone, does not establish a conservation purpose.
V. Scenic Enjoyment
The Internal Revenue Code lists as a qualifying conservation purpose “the
preservation of open space . . . for the scenic enjoyment of the general public.”
I.R.C. § 170(h)(4)(A)(iii). The corresponding regulation says this means, as
relevant here, “to preserve open space (including farmland and forest land)
. . . [f]or the scenic enjoyment of the general public,” so long as the contribution
“will yield a significant public benefit.” 26 C.F.R. § 1.170A-14(d)(4)(i) &
(d)(4)(i)(B).
The regulation continues: “Preservation of land may be for the scenic
enjoyment of the general public if development of the property would impair the
scenic character of the local rural or urban landscape or would interfere with a
scenic panorama that can be enjoyed from a park, nature preserve, road,
16 Case: 18-14817 Date Filed: 05/13/2020 Page: 17 of 22
waterbody, trail, or historic structure or land area, and such area or transportation
way is open to, or utilized by, the public.” Id. § 1.170A-14(d)(4)(ii) (emphasis
added).
The regulation says scenic enjoyment must be evaluated based on all the
circumstances and with flexibility. Id. The regulation includes a nonexclusive list
of highly abstract factors that may inform the analysis but provide little guidance
here. Id. More specifically, the regulation says the general public need only have
visual, not physical, access to or across the property. Id. § 1.170A-14(d)(4)(ii)(B).
The “entire property” need not be “visible to the public,” but the public-benefit
requirement may not be met “if only a small portion of the property is visible to the
public.” Id.
B. View from the Rivers
The record establishes without dispute that members of the public can and
do canoe and kayak on the Savannah River alongside the easement and on the
Little River as it runs through the easement. The view from the rivers includes the
easement’s natural areas as well as the golf course. The record includes a video
illustrating the stark difference in the views of the easement property, on the one
hand, and the property farther down the Savannah River, on the other. The
downriver property includes considerable development—development that few
canoers or kayakers would find scenic.
17 Case: 18-14817 Date Filed: 05/13/2020 Page: 18 of 22
One could perhaps debate whether a golf course provides scenic enjoyment.
But the natural areas covered by this easement surely do. And the golf course,
whose most prominent feature visible from a canoe or kayak on the river is the
trees, detracts only a little, if at all. When compared to a condominium building or
even private homes, the easement property qualifies as open space providing
scenic enjoyment. And preserving relatively natural views along these two rivers—
views free of development on the other side as well because of the national
forest—serves a public interest.
In asserting the contrary, the Commissioner says the rivers’ banks are from
three to ten feet high, as if this somehow eliminates the opportunity for scenic
enjoyment. The Tax Court took the same approach. But trees, on the one hand, and
condos or other buildings, on the other hand, can be seen from a canoe or kayak,
even when a river’s banks are ten feet high. Indeed, if a ten-foot bank obscures
anything, it is the fairways and greens and other non-natural features of a golf
course, not the trees. From a kayak on a river with a ten-foot bank, the flat parts of
a golf course look just like open land. The notion that the banks somehow prevent
scenic enjoyment is a makeweight.
Were it not for the presence of a golf course on part of this property, the
assertion that preserving open space alongside rivers with three- to ten-foot banks
18 Case: 18-14817 Date Filed: 05/13/2020 Page: 19 of 22
cannot be “for the scenic enjoyment of the general public” and provide a public
benefit would be a nonstarter.
VI. Conclusion
The bottom line is this: the record establishes that Champions is entitled to a
deduction in the proper amount. Because it upheld the Commissioner’s
disallowance of the deduction, the Tax Court did not address the proper amount,
and we express no opinion on it. That will be an issue for the Tax Court on
remand.
The Tax Court’s decision is VACATED, and the case is REMANDED for
further proceedings consistent with this opinion.
19 Case: 18-14817 Date Filed: 05/13/2020 Page: 20 of 22
GRANT, Circuit Judge, concurring in part and dissenting in part: I join the majority in holding that Champions should receive a deduction for
donating its easement for conservation purposes. See I.R.C. § 170(h)(1)(C). The easement preserves an “open space” for the public’s “scenic enjoyment,” and “will yield a significant public benefit.” Id. § 170(h)(4)(A)(iii). Two publicly accessible
rivers cut through and around the easement—providing views of the grassy golf course, trees, and shrubbery that are far more scenic than views of the developed properties downstream. But I must part ways with the majority’s decision to reach an issue not argued below and with its separate conclusion that the easement is necessarily a “relatively natural habitat.” Id. § 170(h)(4)(A)(ii). First, I would not reach Champions’ new argument that the governing
statute and regulation conflict. “As a general rule, a taxpayer may not address an issue on appeal which it has not first presented to the Tax Court.” Grant v. Comm’r, 103 F.3d 948, 952 (11th Cir. 1996). To be sure, our cases have also “identified certain exceptional circumstances” where it might be appropriate to use our discretion and “deviate from this rule of practice.” Dean Witter Reynolds, Inc. v. Fernandez, 741 F.2d 355, 360 (11th Cir. 1984). Yet the majority opinion leapfrogs any consideration of our normal rule or its exceptions; instead, the opinion gets right to the merits of an argument first raised on appeal. Doing so signals that we are not terribly committed to the requirement that parties raise arguments below. That message gets amplified by the fact that we have no compelling reason to decide Champions’ new argument: the opinion already hands
20 Case: 18-14817 Date Filed: 05/13/2020 Page: 21 of 22
Champions the win. We should not use our discretion to deviate from ordinary practice here.
Second, in my view, Champions’ easement might not be a “relatively natural habitat.” I.R.C. § 170(h)(4)(A)(ii). The man-made golf course takes up more than 80 percent of the easement. In making the course, Champions used non-native
grasses, one of which requires the use of large fans to keep it cool in the hot Georgia sun. And to maintain the course, Champions pumps anywhere from 70,000 to 600,000 gallons of water a day out of the Little River. Champions also coats its golf course with chemicals—including fungicide, herbicide, insecticide, algaecide, and fertilizer. To apply these potent chemicals, Champions’ staff members sometimes need gloves and respirators. The chemicals
not only artificially change the habitat, but do so in ways that pose what the tax court called “environmental hazards.” In fact, Champions designed the golf course to drain into nearby ponds, creeks, and otherwise undisturbed wetlands. The golf course drains toward the knotweed (a rare plant that Champions says is protected by the easement), and as the majority itself recognizes, “the knotweed thus may suffer harm from the chemicals used on the course.” Maj. Op. at 14. Although the majority finds comfort in Champions’ pledge to follow the golf industry’s best environmental practices, we have little information about what those practices are, or how they stack up to other standards. And those standards, whatever they are, hardly define the boundary between easements that can and cannot qualify for a deduction under federal law.
21 Case: 18-14817 Date Filed: 05/13/2020 Page: 22 of 22
Ultimately, the majority is willing to look past the easement’s unnatural features because of the birds and squirrels living there. The argument has some
force, especially because it does appear that the tax court overlooked evidence about the prevalence of these species. But the presence of animals cannot hide that a lot of the easement is highly developed and at least somewhat hazardous to
certain species. And no matter how many animals live on the Champions easement, the reality remains the same: with the chemicals, imported grasses, large fans, artificial drainage, and water pumping, it is not at all clear that the easement amounts to a “relatively natural habitat.” I do not mean to say that a golf course could never qualify; it’s simply not clear that this one does.
As thorny as this “natural habitat” question is, we could spare ourselves the trouble of solving it. After all, we could limit our decision to holding that the easement qualifies for a deduction as an open, scenic space. That is the course I would take. I therefore concur in part and respectfully dissent in part.