In November 2008, Tom participated in a meeting of leading water and tax experts hosted by Resource Renewal Institute‘s (RRI) Huey Johnson, former California’s Natural Resources Agency Secretary under Governor Jerry Brown, co-founder of the Trust for Public Land, and former President of The Nature Conservancy. This 2008 meeting catalyzed two years of pro bono legal diligence and regional peer review, which resulted in a published law review article and RRI hiring Tom to strategize and execute this potential landmark conservation precedent.
Since October 2010, first on behalf of RRI and now as of Counsel for Trout Unlimited’s (TU) Western Water Project based in Bozeman, Montana, Tom has directed and led a regional federal tax law and policy campaign to affirm the federal tax deductibility of water right donations. Remarkably, this federal tax precedent has not already been established. Such a tax incentive would be analogous to land donations made through conservation easements – a tool that has led to millions of acres saved in its four decades of use.
An affirmative Revenue Ruling will effectively expand federal funding and improve the tools available for conservation. The most likely implementation of this tax deduction will be in bargain sale transactions that have both cash and donative components, e.g. 75%-25%. Formal clarity from the IRS regarding federal tax deductions for water right donations will reduce donor uncertainty and will provide a new opportunity for landowners, land and water trusts throughout the west to enhance and protect instream flows.
In October 2012, RRI, TU, and the Colorado Water Trust submitted a formal Revenue Ruling Request (Request) to the IRS regarding clarification of the tax deductibility of a gift of the real property interest in an appropriative water right under state law and the Internal Revenue Code.
This Request was on behalf of an Instream Water Transfers Coalition of regional water and land trusts in California, Oregon, Washington, Nevada, Montana, Colorado, and across the West, which protect and restore ecologically important riparian lands and river corridors in partnership with willing landowners through voluntary water transfers transactions.
Since October 2012, the Instream Water Transfers Coalition has been pressing for a Revenue Ruling.
In June 2013, the project seamlessly transitioned from RRI to Trout Unlimited, where the Instream Tax Incentives Project continues to advance efforts on behalf of the Instream Water Transfers Coalition.
Today, Tom works with the leading-edge of attorneys and public-interest, water trust organizations commonly committed to use of voluntary, or non-regulatory, water transfers that have instream flow benefits.
Since 2008, Tom has:
- Submitted an October 2012 Revenue Ruling Request to the U.S. Dep’t of Treasury and Internal Revenue Service seeking clarification of existing federal codes regarding the tax deductibility of the real property interest in an appropriative water right donation. RRI is now pressing for 2013 Ruling.
- Initiated and led Revenue Ruling campaign on behalf of a regional Instream Water Transfers Coalition of specialized water trusts and public interest organizations.
- Coordinated regional outreach to U.S. Senators, Western Governors Association (WGA), Western States Water Council (WSWC), state and federal agencies, land and water trusts, and others.
- Collaborated to locate taxpayers committed to claim water right deductions on their tax returns.
- Generated recommendations to WSWC, which were accepted for report to WGA on “Innovative Water Transfers.”
- Initiated and led network of California public interest organizations to address inconsistent state and federal instream water transfer policies related to voluntary water transactions such as acquisition, lease, and donation of water rights.
- Worked with varied California partners to transfer reduced consumptive water use.
- Analyzed California water transfers, including Water Code section 1707, and generated both state and federal policy recommendations.
- Planned and coordinated series of regional water transfer law and policy briefings for leading-edge water transfer and tax experts.
- Advocated for state-level donative water transfer policies in: CA, MT, OR, WA, CO, NV, DC.
- Presented as a Panelist at various regional forums.
- Led philanthropic fundraising through foundations and private donors to sustain multi-year campaign.
- Published law review article on the tax deductibility of water right donations.