This practice emphasizes the need to review immediate and long-term costs of holding land and to secure operating and/or dedicated funds to carry out the land trust’s responsibilities. A land trust should determine the amount of funds it will need to properly care for the land immediately and over time. The land trust should set priorities, ensuring first and foremost that the values for which the property was acquired are at least maintained or strengthened. The land trust should then create a budget and secure these funds, or ensure that it has a steady source of operating income to cover these costs. Specifically restricted funds should be placed in a designated fund or funds (see 6G.) If a land trust does not have adequate funds for the stewardship of its land it should have a fundraising strategy and a board policy committing the funds for this purpose, and be able to demonstrate progress toward meeting the goals of the strategy. Special funds such as legal defense funds may be set up in the event of challenges against conservation agreements.

Like all Canadian charities, land trusts must spend 80% of their charitable receipts on charitable activities in each year. Charities that exceed the 80% mark in their expenditures may carry the excess forward up to five years or back one year to offset a shortfall. Fundraising expenses are not included as charitable activities (see 5A). Funds applied to endowment funds or other dedicated funds that are established to earn interest over the long term are not included as charitable activities by the Canadian Revenue Agency. Therefore, land trusts who wish to develop these types of funds must either do so by using less than 20% of their incoming receipts, or by carrying over an excess into a future year, or by receiving funds through a bequest (considered exempt by CRA) or by having donors direct funds into a gift that must be retained by the organization for 10 years.