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# Finances & Limitations

Earth Bridge Community Land Trust (EBCLT) Land Users have a long-term lease on their particular leasehold, and shared use of any specially designated common land, if that exists on their parcel. All Land Users in good standing have a vote and a voice in all membership-wide decision-making. They are eligible to sit on the Board of Directors and committees, and to have their opinions heard by the organization.

## Finances

The Land User makes regular payments toward the lease fee until it is paid in full. This is separate from any mortgage payment the Land User may make on the improvements since the Land User owns the buildings but leases the land from EBCLT.

Each year, the Land User pays two tax bills: one to the town for the taxes due on the improvements, and one to EBCLT for the taxes due on the land associated with the leasehold. There is also a yearly EBCLT membership fee.

The lease fee for a given leasehold is determined at the beginning of any lease and is based on a standard per-acre equation. This fee is significantly less than the open market cost of land. The lease fee requires only a small down payment, is not subject to interest of any kind, and is typically paid within 10 to 20 years. If there is more than one leasehold on a given Land Trust parcel, each leasehold will pay its share of the property tax bill.

## Limitations of the Lease

It is important for potential Land Users to be aware of the limitations of leasing from EBCLT. This organization holds itself, as much as possible, apart from the pressures of the real estate market, and this must be understood and appreciated before committing to becoming a Land User.

Specifically, please be aware of the following:

- Land ownership is exclusively reserved to EBCLT. Land Users own their houses and other improvements.
- Because of the above, it has sometimes proven difficult for EBCLT Land Users to procure a mortgage or home equity loan. Banks are sometimes reluctant to work with Land Trusters because they own their house but not the land under the house.
- Land Users may use the land in any way they see fit in accordance with the EBCLT mission and the stipulations of their lease, including farming, gardening, or landscaping. Extractive practices, such as mining, are not allowed.
- It is the intention of Earth Bridge that our Land Trust homes be our Primary Residences. Since having the lifelong, affordable use of an EBCLT leasehold, along with membership in the EBCLT community, are such unique opportunities, when leaseholds become available, EBCLT wants to offer this opportunity to people who are eager to live on, use, and care for a piece of Earth Bridge land. Leaseholds are not to be used as second homes, vacation homes, or rental units. EBCLT is a small membership organization and we depend on the active presence and participation of all our members for successful governance and the survival of our organization. Subletting the leasehold for any length of time or absences of more than one year may be allowed by special arrangement for a limited term as per Sections IV. 13. A and B of the Standard Lease.
- There are no specific development restrictions on EBCLT land, however any significant development to the land, including new buildings, requires permission from the Board of Directors.
- Transfers of leaseholds take time. While on the open real estate market you can sometimes buy a house inside of a week, at EBCLT the typical transfer takes a number of months at a minimum. This reflects both the care that EBCLT takes to ensure the integrity of the process and the fact that nearly all the work is done by our member volunteers.
- All EBCLT leases limit the selling price for the improvements (houses and outbuildings) to not more than 100% of the appraised value at the time of sale. Some Land Users choose to further limit the selling price of their improvements and stipulate that in their lease. This means that they are legally bound to sell their improvements for no more than a certain percentage of the appraised value at the time of sale (typically 80%). Questions about the existence of a limited equity clause should be directed to the Land User.