|
Windmills in Adams County Real Estate Values Expert Testimony from Tazewell Co., IL |
|
|
This photo caption, from Wisconsin, is obviously dripping in anger and sarcasm, but it makes a point. Some people get pretty angry when their life investment is devalued or ruined with one decision of the County Board. Fon du Lac County in Wisconsin used 1000 foot setbacks, like those in our ordinance, and now there is a LOT of anger there about the effects of their wind farm on their life and property values. Let's learn from their poor ordinance, and improve ours accordingly. Photo: Butler Ridge Project near Iron Ridge, Wisconsin, May 2, 2009, with thanks to Better Plan Wisconsin. (Photo found on WindTurbineSyndrome.com website) _________________ Mendota Hills, IL Study The link below refers to the Mendota Hills study, also done by Mr. McCann, which showed the loss of land values there because of wind turbines. The Mendota Hills Study showed that of 40 properties that sold located within 5 miles visibility of the turbines at Mendota Hills, Illinois, the homes sold for an average of 25% less than comparable homes outside that five mile distance. In addition, there were two properties for sale near the turbines that never received an offer, even with reduced prices and more than 100 initial inquiries. http://www.windaction.org/documents/24637
|
What's a Wind Farm House Worth? Common Sense First, before considering expert testimony below, what does your common sense tell you? After all, real estate is only as valuable as someone like you and me will pay for it. If you were planning to buy a home in the country, and you had a choice between two houses that were exactly the same, except one was surrounded by wind turbines like the photo at left, and the other one did not have wind turbines in the back yard, would you offer the same amount of money for either house? If not, then you've answered the question...it is reasonable to be concerned that wind turbines will impact real estate values. ___________
The following is a transcript of sworn testimony of Mr. Mike McCann, an Illinois Professional Real Estate Appraiser, who has the highest level of credentials for appraisers in Illinois, 28 years of experience, and expertise in the impact of valuations of properties located near wind farms. He discusses the "REPP Report," one study the wind industry uses to back up their claim that wind farms do not affect real estate valuations. The REPP report, commissioned by the wind industry, is a study of California grazing land where 70% of the properties do not even have a view of a wind tower, making it an irrelevant study for wind towers placed in the midst of populated rural Illinois areas. |
|
From sworn public testimony given at the Tazewell County (Illinois) Zoning Board of Appeals Hearing, May 1, 2008 by Michael McCann, a licensed real estate appraiser. The questions were asked by Mr. Spanos, the attorney for (to come) and by Mr. (to come) attorney representing the wind developers. Mr. Spanos begins the questioning: Q: Are you licensed to practice in Illinois? A: I'm a licensed appraiser, certified general real estate appraiser, which is the highest of the three levels of licensing of the State of Illinois Q: How long have you been working as an appraiser? A: For 28 years with experience appraising virtually all types of residential and commercial property. (Mr. Mc Cann goes on to describe the types of properties he's worked on over the course of his career-- they include residential, commercial, industrial, farm, and many other types of property along with the types of clients who have hired him including law firms, government bodies, lenders, private individuals.) Q: Have you ever been asked to evaluate the affects of a perceived negative trait upon the value of residential real estate plots? A. Yes, I have. Q: In what circumstances? (Mr. McCann goes on to describe different circumstances he's evaluated) Q: How about the effect of wind turbines or a wind turbine facility? A: I have had a few occasions to evaluate wind turbines, yes. Q: And you were asked in this case to evaluate the potential effect of the Rail Splitter Wind Farm on residential property in Tazewell County, correct? A: That's correct. Q: What methodology did you follow in arriving at your conclusions? A. Well, I used the methodology that was best suited to the information that is available, since this is still a relatively new land use in Illinois. But again, with review of the proposed Rail Splitter Wind Farm Project, you know, including you know, the location of the project overall, the number of turbines, the height of the structures, and the orientation with respect to the nearest homes. So I also inspected the project area, reviewed the project map, and again the proposed turbine locations. I also made a curb site inspection of each of the objector homes that I'm aware of that have been -- have been retained by your firm. And beyond that I reviewed MLS listings and sales data for homes in Lee County for properties within or immediately adjacent to Mendota Hills, an existing wind farm which is a smaller, I should say not as tall of towers or structures or turbines as what's proposed here. I also researched the final conclusions of a prior case study property that had been on the market for a very extensive period of time. The last time I looked at one of these proposed facilities and found the ultimate conclusion of how that property was in fat impacted by being basically surrounded by these turbine facilities. Beyond that, I also made a literature review including the REPP report, which I believe has been referenced in this hearing prior to me being here, as well as reports contained in appendixes eight and nine to the application. And then I incorporated the market trends that exist for residential properties adjacent to these facilities into a probable value impact on homes in the Rail Splitter Project. (Mr. McCann goes on to explain the methodology he used, and Illinois law concerning appraisers and the standards they must uphold) Q: What are those standards? A: An appropriate methodology has to be used, and the methodology has to fit with what is available in the market. Sometimes current sales analysis is used if it's available, and sometimes in like a case like this, trying to find the effect of the use in question, wind farms on property values, just studying the actual property value trends in close proximity to such a facility versus further removed plots that have no such impact or that would be so minimal as to be immeasurable, you know, several miles out from such a project. Q: And you've reviewed Horizon Wind Energy's [wind developer] application for Special Use permit in this case? A: I have, yes. Q: Page 22 of the application refers to property values, have you reviewed this section of the report? A: Yes, I have. Q: And the section also refers to appendixes eight and nine in the application, right, you mentioned those before? A: Yes, I did. Q: In the REPP report, is that right? A: Yes. Q: What is the REPP report? A: Well, the REPP report is essentially an industry publication-- as opposed to something made by an appraisal firm or an objective third party. As I've learned in the past, it is essentially a study that was done at the behest of and financed by the wind power industry. What it purports to show is an encompassing study of plot values in wind farm locations, for example, in the I-10 corridor near Palm Springs, California, LaQuinta. I have actually visited that particular location and found that what the REPP report is purporting is highly inaccurate really because it was describing 25 thousand plot sales that had been reviewed, many of which were in that area and -- well, it's purporting to value for the effect of a wind farm, or really multiple wind farms, on residential property values. Even in that study it recognizes that 70 or 72 percent of the properties aren't even within a view shed of these wind farm facilities. My personal visit out in the area revealed that it's a very rural and desolate area. The more I saw other than--- and at that I-10 corridor, other than a variety of different generations of wind farm and turbine facilities, some smaller, some larger, some old and rusty and out of commission, and some fairly modern ones, was that there was not a single residence in sight anywhere along that corridor. In fact, I had family that has a property in the Palms Springs area and that's why I had the occasion to visit that particular corridor and I found it to be an inappropriate location unless you are trying to value for the impact of wind farms on grazing land. Q: Does the REPP report review or include any properties located in the State of Illinois? A: It does not. Q: You have mentioned the word 'view shed'-- the Board probably already knows, but explain that to us. A: It means different things to different people, but the way I use the term, if you are in close enough proximity that it actually impacts your view as opposed to being such a great distance that it can merely be seen from a great distance. I use view shed in a more confined use of the term. Properties in tis case that are in the view shed are certainly located within the project footprint, covering quite a few sections, I believe nine different sections in Tazewell County, as well as properties in close enough proximity, say within three/quarters of a mile to a mile that-- it's a daily occurrence as opposed to being on the other side of 39 when you're looking at Mendota Hills. And you know, there is some locations that these wind farms can be viewed from as much as five miles away, and in one of the other appendixes there are two different locations cited that the wind farms in Texas and elsewhere can be seen from as far as eight or 24 miles away. While that is certainly visible, I wouldn't really call that view shed in the sense that it has any potential for impact on property values. Q: Do you think that the REPP-- do you have an opinion as to whether or not the REPP report is in any way relevant to the effects of wind farms in Illinois? A: I do. Q: And what is your opinion? A: It's irrelevant. Q: And why is that? A: Well, it again draws on locations which are outside of Illinois; it does not reflect the local market or even a comparable market. It reflects Palm Springs property values at a point in time when values were spiking, you know, to six hundred thousand, million and a half, multi-million dollar properties. Far different than what we find along Litwiller Road or Boynton Road in Tazewell. These are not rural residential properties, these are estates, in most cases with walled little communities, and each house, for that matter most of them, have at least six foot and in some cases eight foot walls around the houses. It again uses data that does not have the potential to reflect any impact on the property values as a result of wind farms because of the lack of view and lack of proximity. (Mr. McCann and Mr. Spanos continue to discuss the wind industry's REPP report on property values and other studies including studies since 2006) Q: Do we have any more information today than what was available in 2006 with regard to property values and the effects of wind farms? A: Yes, we do. It's still an area that needs considerable study and really should be funded to be done in a very objective and empirical manner, but it might take some time because, frankly, a lot of the plots immediately adjacent to these facilities [wind farms] just don't sell, they get pulled off the market, or an example we are going to go through in a few minutes, sits on the market for nearly three years prior to selling at a discounted price, Q: Now, you mentioned before that this isn't your first wind farm that you have been involved with, correct? A: That's correct. Q: When you first were asked to do a property value study with respect to a wind farm, what kind of information was available at the time? A: Well, really just literature and information like this REPP report. Q: was there much in the way of sales out there that you could look at and compare? A: There really wasn't much. There were some sales that occurred before or during the planning stages of wind farm facilities, but the ones that are most relevant really reflect what property value trends are once the project is constructed, not when it's merely proposed or there is an application pending, such as this matter. Q> Is there more information available today? A: Yes. Q: And why is that? A. Well, passage of time, and it ash (?), the market is starting to catch up with the actual impact of these facilities. Q: And specifically, are you referring to any wind project? A: I am referring to the Mendota Hills project in Lee County. Q: Is that one of the older wind projects here in Illinois? A: Yes, it is. Q: SO it makes sense that over time you would have a little more data there since they have been there a little bit longer: is that right? A: Yes, that's correct. Q: Have you reviewed any other studies with respect to wind to wind farm effects on property values that have haven't talked about? A: Well, I have reviewed a, in the past some information about an assessor's sale ration study in Wisconsin. Q: What did the study show? A: Well, it showed property sales were, actually adjacent to an existing wind farm there, were a significant percentage lower, 15 to 20 percent lower, if I remember correctly, or maybe as high as 27 percent in closer proximity to what the baseline or assessed values were, as differentiated from the other properties in that country that were selling at much closer to, you know, a 1.0 factor to the assessment ratio.. Q: Doesn't the public's perception of a negative trait or a perceived negative trait with respect to something like a wind farm have an effect on property values? A: Well, it certainly can, if it's a perception that sticks or if there is an aversion to selling-- or excuse me--- buying properties based on unknowns and fears and lack of guarantees and so forth, when it's an unknown quality, there is fear, and those kinds of perceptions can certainly be a factor in the buy/sell decision. Q. You have heard some testimony and talk today about health issues, environmental issues, et cetera, are those the type of issues that can have a negative effect on property values? A: To the extent the people react to them by selling out lower or not buying at all of holding out for a discounted price, yes, it certainly can be a factor. Q: In your research have you found that there is a significant portion of the general public that has a general negative perception of wind farms or property around wind farms? A: Not jut in my research, but also in the research cited in appendixes eight and nine. There is a variety of studies referenced in those tow appendixes that cite various surveys of communities and assessor's offices, and so forth , and there are several references to peoples perceptions along that line, yes. Q: All right, let's talk about the appraisal that you did. There is a map of the properties and wind turbines, did you go out and look at any of these properties? A: I went out and looked at all of them, up and down all the roads in the immediate area, and specifically stopped and looked at each of the properties that are your clients. Q: What was the next step then in your appraisal? A: Well, do you want me to go through them real quick? [Mr. McCann shows slides of the properties and gives brief descriptions of each] Q: Let me ask you a question about this picture. Does this depict where a wind turbine will be as part of the plan, or according to the plan a wind turbine is going to be placed somewhere in this picture? A: Yes. From the best of my recollection, it will be behind that stand of trees that are standing in the side yard, the easterly side yard of the Taylor residence. Q: And will that tower be visible over that stand of trees? A: I believe it's going to be-- it will be 389 feet tall to the tip of the blade, and you have to be standing right up next to the trees for that to provide any effect of screening. [more description of slides showing potential turbine locations in relation to the Taylor home and other homes that will be affected by the wind farm and then slides of houses adjacent to or in the Mendota Hills wind farm project.] A: What do you know about this house, Mike? Q: I inserted that slide in my report, a basic description of the property. It was new construction completed in the fall of '05. It's a three bedroom, two bath home on a five acre lot, carved out, nice lot that had a couple of mature trees on it. The house has hardwood floors in the living room and dining room, and a fireplace, sliding glass doors. [more description of the house] two car garage also an outbuilding that is 52x48 with water and electric. It's in the Paw Paw school district. [more about the house] The property sat on the market for about 840 days, having gone through several different realtors before a sale was finally accomplished at 275 thousand dollars. 28 months, 849 days is--- let me put it this way, it is a marking time that a relocation company just would not deal with at all. [more about the house, and then about other houses in or in proximity to the Mendota Hills wind farm] ... even the other properties, just in homes located in close proximity to Mendota Hills were experiencing marketing times in excess of 300 days, 400 days as this one, the end result was 840 days, and a discount from the original asking price of just under 17 percent of 55 thousand dollars. [....] Q. Did you learn since you prepared this report any additional information with regard to the home sales in Lee County? A: Well, in Lee county what I did learn was there was, for many of the homeowners in close proximity to Mendota Hills facility, that when the new assessment came out they brought in considerable testimony to the Board of Review from a number of property owners claiming that they could not sell their homes and bringing in evidence of having listed the properties and with no success.
|
|
