But, as Lawrence A. “Larry” Selzer told me last week, traditional conservation, by itself, won’t protecting America’s vanishing forests and farmlands. “The traditional funding sources are being stretched,” he says. “We need additional strategies.”
That’s where The Conservation Fund comes in. A nonprofit based in Arlington, Va., The Conservation Fund was founded in 1985 by Pat Noonan, a former president of The Nature Conservancy and a MacArthur Foundation “genius” award winner, who wanted to harmonize environmental protection and economic growth. He wanted to start a business-friendly group that was nimbler and more focused.
Selzer, who has been CEO of The Conservation Fund since 2001, says: “We want to be the entrepreneurial, risk capital group, and be able to make decisions quickly. We’re small. No members. No advocacy. No litigation. Entirely project focused.”
So, while The Conservation Fund engages in the traditional practice of buying and protecting land–nearly 7 million acres nationwide since 1985–it’s also deep into what Selzer describes as “the business of conservation.” Its Land Trust Loan Program looks like a bank, lending money to local land trusts to buy valued land. It is an investor in forest land, which will be protected (but not untouched) by sustainable timber practices. It also manages the Natural Capital Investment Fund, a federally chartered Community Development Financial Institution (CDFI) that invests in environmentally-friendly businesses in distressed rural areas in the southeast.
“The tools of the marketplace,” Selzer says, “can be used to accelerate conservation.” But, he adds, left to themselves, markets create pressures to maximize short-term gains that will threaten environmental protection. Put simply, land owners can make more money by chopping down trees to build houses or shopping centers than they can by preserving or even harvesting them.
“We’re losing a million and a half acres of forest land every year in this country,” he says. Forests provide clean water, critical wildlife habitat and forest products, as well as places to play and enjoy. Trees also sequester CO2, and so slow down the process of climate change.
Selzer, who is 51, graduated from Wesleyan University in 1982 with a degree in environmental science, “thinking I was going to become the next Jacques Cousteau.” He’d watched Cousteau & Co. on TV cavorting on Mediterranean and Caribbean beaches. He spent the next few years as a marine biologist, studying marine mammals and seabirds off Canada’s Atlantic Coast, where he learned, among other things, that “chipping ice was not the same as swimming in a bikini in the Caribbean.” He also learned that “only Jacques Cousteau gets to be Jacques Cousteau” so he headed off to business school at the University of Virginia. His goal, he said, was to find ways to “use natural resources to promote economic development and job creation, without degrading those resources.”
This is what the National Capital Investment Fund aims to do–create wealth in rural, economically-distressed communities in ways that protect farms and forests. The fund is small–it has raised about $12 million so far, and loans are typically no more than $250,000–but it has invested in some promising companies. The Crazy Baker, Blue Smoke Salsa and The Palisades Restaurant support farmers by buying ingredients locally. Wilderness Voyageurs leads kayak, rafting and bike tours on 15 rivers in three states. FLS Energy designs and installs solar thermal hot water heating systems. NCIF also funded a pilot project to explore market demand for locally processed chickens raised naturally by North Carolina growers.
These are “not startups, but small and emerging natural-resource based companies,” Selzer says. “Our job, for the most part, is to buy down risk so that commercial lenders can come in and invest in these companies.” The goal is not to make money but to support the companies’ missions and recover costs so that the fund can be reinvested. (For more on how CDFIs work, here’s an interview with my friend and fellow Net Impact board member Mark Pinsky.)
All of this work helps deliver an important message–that environmental protection and economic development can be aligned. The challenge, of course, is scaling up these efforts so they go beyond cute to have a more meaningful impact. Scale matters.
To that end, Selzer is now raising money to operate a nonprofit Timber Investment Management Organization. He’s raised about $20 million; he’d like to get to $200 million. The plan is for The Conservation Fund to buy environmentally-important forest land, place a conservation easement on it so it cannot be developed and then sell the land to a private owner who will harvest it sustainably. “Because our cost of capital is so low, we can harvest in almost a restorative way,” Selzer says.
Some of this work is controversial. Critics worry that environmental groups can lose sight of their mission when they get too cozy with business. But sustainability has to be about more than pursuing environmental and social goals. It has to be about making money and generating wealth, too. Otherwise it’s, quite simply, unsustainable.