3.6 Final Actions
- MCA Field Guide
- MCA Field Guide Checklist
- Phase 3: Agreement Design Checklist
- 3.1 Conservation commitments are established
- 3.2 Recipient benefits are determined
- 3.3 Compliance mechanisms are developed
- 3.4 Sanctions are agreed upon
- 3.5 Regulatory permits issued or applied for
- 3.6 Final actions are completed
Before formal Marine Conservation Agreement (MCA) documents can be signed and executed by the parties, there may be several "pre-closing," final actions that should be taken. Final actions will vary from project to project depending on the Model and Type of MCA being employed. Below are common final actions that MCA leads should consider.
Additional Assessments
Additional assessments may be needed prior to finalizing an MCA. These include:
Capacity Building: Once commitments are agreed upon, the capacity of the lead conservation organization, right-holders and other direct stakeholders can be re-assessed to identify further capacity-strengthening needs. Capacity may be necessary for implementation activities, including fund management.
Revised Cost Estimates: At this point, the lead conservation organization can revisit cost estimates for the agreement and assess affordability. Costs were originally estimated in sub-step 1.7 Costs and Financing, while an overview of costs of the MCA itself (as opposed to other project costs) is presented in Valuation.
The final actions below apply specifically to MCA projects that employ purchase-like or contract/lease-like mechanisms in countries with well-developed tenure systems and sophisticated markets (such as the U.S.).
Contingencies and Final Instructions for Purchases
Lead conservation organizations should Exercise the Option or Waive Contingencies for fee-simple purchases. This is the action that legally obligates the organization to acquire the land, resources or services. Consequently, organizations must be certain at this point that they want to acquire the land or resource interest and that any risk associated with the acquisition is acceptable.
Closing Statements and Final Instructions should also be reviewed at this time for fee-simple purchases. All necessary funding should be in the Escrow. Fees, costs, and funds should be allocated correctly.
Performance Bonds for Contracts
In some cases, right-holders (usually government agencies) will require lead conservation organizations to acquire performance bonds prior to entering into contracts. Performance bonds may be forfeited to authorizing agencies for several reasons, including: if rents are not paid; if lead conservation organizations fail to perform as per substantive contract requirements; and to remove newly installed improvements at the end of the contract.
Final Walk-Through
A final walk-through of the property or area can be performed, and in many cases is highly advisable, to ensure the status and condition of the conservation targets has not changed while the project was being developed and the MCA was being negotiated. For obvious reasons it is often difficult, if not impossible, to walk-through lands and resources lying within ocean and coastal waters. If the amount of time that has passed during development and negotiation of the MCA is short, the location of the proposed MCA is remote, and human use of the land, resources or ecosystem services targeted by the MCA is minimal, a site visit may not be necessary. However, if a site visit is desired, timing the visit with low tides will be beneficial for intertidal areas and accessing the area with boats, SCUBA, or underwater cameras may be necessary for subtidal areas.
Signing the Purchase and Sales Agreement
For MCA projects that involve fee-simple purchases, the Purchase and Sales Agreement should be signed by both the seller (right-holder) and the buyer (the lead conservation organization). Contingencies in the agreement should be made for outstanding issues related to corporate/board approval, regulatory permits, and due diligence.
Final Approval
Some organizations require that final approval be given by the corporate or board prior to closing.
Closing
The lead conservation organization's project manager should authorize in writing closing the sale or executing the contract, at which time the escrow (if applicable) can close.
Executing the Final Agreement or Deed
The MCA deal or transaction must finally be closed by executing a contract or deed. Each party must sign and receive copies of the contract or sales agreements. At this point, funds and the title or contract should be transferred and the deed or memorandum of contract should be recorded or filed at the appropriate public office. Government agencies often require other parties to sign documents prior to their signature. In some cases, it may be appropriate or beneficial to organize an agreement signing ceremony as a means to build pride in and recognition of the agreement among the community. Inviting special guests and authorities to the ceremony increases its relevance, can enhance legitimacy, and strengthens commitment to the agreement.
Title Insurance
Concurrent with closing the MCA deal that involves a fee-simple purchase, a title insurance policy that indemnifies the policy holder (i.e., the buyer/lead conservation organization) for loss sustained by a title that proves defective should be acquired. Organizations should consider acquiring title insurance policies for contracts (such as leases) dealing with property rights as well. The cost of the title insurance policy should be weighed against the cost of the contract.
Closing Costs
Finally, the lead conservation organization may have to pay closing costs and taxes (if sales or lease excise taxes, or other taxes need to be paid), and consider purchasing liability insurance for the asset.
Next Phase
After all final actions are completed, including signing the MCA by all parties, the project can be implemented.
Proceed to Phase 4: Implementation