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the highest and most profitable use for which the property is
adaptable and needed or likely to be needed in the reasonably
near future. Olson v. United States, 292 U.S. 246, 255-256
(1934).
The value of the property after the donation must also
reflect its highest and best use. Accordingly, consideration of
any new restrictions the easement places on the property must be
taken into account. Losch v. Commissioner, T.C. Memo. 1988-230.
To establish the fair market value of the easement, each
party offered the report and testimony of an expert witness:
Wheeler, for petitioners, and Boyett, for respondent.
At the outset, we note that petitioners' expert had
extensive experience appraising conservation easements. In fact,
since 1982, Wheeler has appraised more than 100 conservation
easements, and spent close to 70 percent of his time appraising
conservation easements primarily in Montana and Wyoming. In
contrast, Boyett, respondents' expert has never evaluated the
effect of a conservation easement on property. Any real estate
appraisal experience he has is primarily limited to the
southeast.
In determining the value of the easement, Wheeler concluded
that the most profitable before use was primarily rural
development and recreational use, in connection with
agriculture, either in parcels or as a whole. Accordingly, he
concluded that the easement had a fair market value at the time
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