Expert: Power lines hurt property value
Market research shows sellers lose up to 53 percent
By Elizabeth Cooper
A high-voltage power line from the Utica area through the Southern Tier into the Hudson Valley is likely to reduce property values, an expert who has studied such cases said.
Kent Sick, an author of a 1999 paper on the impact of power lines on real estate prices, said his research showed there was a clear reduction in property values. Reductions have ranged from just a few percentage points to as much as 53 percent, Sick found.
"The market evidence was undeniable that power lines affect property values," said Sick, an eminent domain attorney from Texas.
If the New York Regional Interconnect line is built and property values go down, it could affect municipalities and schools, which depend on property-based taxes. Officials said that could lead to decreases in services or property tax increases to offset the losses.
New York Regional Interconnect spokesman Jonathan Pierce declined comment on Sick's paper, saying he had not seen it. He said it is impossible to say what impact the line would have on property taxes until it was built, and that some studies show that such projects have no impact on property values.
But officials near the line's starting point in Marcy, northwest of Utica, are worried.
"It would be a complete disaster," said Earle Reed, town supervisor in the Utica suburb of New Hartford. "It would not only greatly diminish the property values, but also the aesthetics, and it passes by our schools," he said. "There's all kinds of concerns."
Something to pass on
Among those concerned is Dave Kalies, who loves his home in rural Paris Station, south of Utica. His house looks out on a valley with railroad tracks passing through it.
"We figured our land and the house was something we could pass on to our kids or use as retirement," he said.
Kalies has done extensive remodeling on the house and built his business, Kalies Collision body shop, down the road. Now he's afraid the property might not be such an asset if the proposed 1,200-megawatt power line is placed along the tracks.
In interviews all along the Oneida County portion of New York Regional Interconnect's proposed power line route, people expressed similar sentiments. Some even said they might move.
In their paper, "Power Lines and property Values: The Good, the Bad and the Ugly," Sick and David Bolton examined studies performed by other researchers in Oregon, California, Texas and Missouri.
The studies compared the values of homes near power lines to those of comparable homes where there were no lines.
Some of the studies were done by researchers hired by power companies. Even those found reductions of up to 10 percent.
Others said values plummeted between 18 and 53 percent, although Sick said he thought those numbers were too high. One study, commissioned by the Lower Colorado River Authority on lines in Texas, said properties in or near the power lines' easement there could suffer by up to 90 percent.
Still, Sick said, most property near power lines does sell in the end.
"It's not so much a question whether property won't sell, but how much of a discount are purchasers going to demand because of the fact there is an unsightly power line in the backyard," he said.
Company's response
Power company spokesman Pierce said it wasn't possible to say how the line would affect property values, since it didn't exist yet.
"Anecdotally, in some (cases) property values are not impacted at all," he said.
About the studies that indicated diminished home values, he said, power lines might not be the only reason.
"There are a lot of variables that impact property value, and any study has to be looked at very carefully," he said. "They can be impacted in many ways, from what's happening in the neighborhoods to the structure of the house."
Pierce said there would likely be instances in which the company would try to acquire property along the right of way, and would do so at or above fair market value.
There are already areas in Upstate New York where power lines crisscross the landscape.
Patricia Mody of Signature Realty near Utica agreed that some buyers are put off by power lines and others aren't.
"It depends where," she said. "It depends who."
The power line ripple effect could go beyond individual property owners who live near the line.
If the assessed values of numerous properties fall, towns and schools that depend on property-based taxes also could suffer. Paris Town Supervisor Joseph Jerzak said a small drop in average assessed values could have an impact.
"Say your total assessments dropped by, let's say 5 percent, it's got to be picked up some other way," he said. "It would be picked up by an increase on what's left, or cutting services."
New Hartford Assessor Paul Smith declined to estimate how much property values in the suburban town could fall. One of the proposed routes would take the power line behind Little League fields.
"Just based on the public concern, I would definitely think a buyer would be a little leery," he said. "A lot of things impact value, if it's cosmetically undesirable, or possible health risks, any of those things could affect value."
Gannett News Service May 20th, 2006 |
