By Donella Meadows
–April 16, 1987–
Some people here in New England say that land protection is a “champagne and quiche” issue. They clearly doesn’t understand land economics. Land protection is an issue for hunters, fishermen, hikers, snowmobilers, anyone who is a tourist or has a tourism-related job, anyone who has a groundwater well, anyone who uses paper or lumber, drinks milk or eats apples, anyone who pays taxes, anyone who likes the look of a forest or field better than the look of strip “development”.
That doesn’t leave out many of us.
In the twenty-minute drive from home to work I pass mostly forests and hayfields. I would pay at least $10 per year, just for the pleasure of looking at them. I bet a thousand people who use that road feel the same way. The Leafpeepers who come up from the city just to drive slowly along actually do pay more than that for each trip.
As “development” runs rampant, the road is not only losing its beauty, it is also gaining curb-cuts, traffic, stoplights, and cops. We will soon need road improvements, not to mention a new school and a new dump, all paid out of taxes. It might actually be worth $100 a year to me as a straight economic proposition to keep those forests and fields from being “developed”.
The farmers harvest from the land corn or hay or wood worth maybe $50 to $500 an acre every year. If they’re good managers, that income will go on forever. The rest of us get to use the lumber and eat the cheese.
To the surrounding communities the forests are worth a bit in taxes, but their greatest value doesn’t show up on a ledger. The forests cushion and absorb the rainfall, charging the aquifers from which we drink, storing and filtering runoff to keep the streams clear and their flow regulated. Forests are worth billions of dollars in water supply and flood insurance, especially to the people in the cities downstream.
To a “developer”, the land is worth at least $1000 an acre, much more for an acre near an intersection or by a lake or with a view. It yields that profit only once.
From then on the economics of the land are completely changed. There may be utility for a homeowner, income from a shopping mall, higher taxes for a town. The money flow is greater, but that value no longer comes from the land. It comes from constant inputs — construction and maintenance, energy, labor, sewers, trash collection — all of which cost money and draw resources from land somewhere else.
If we let the market guide “development”, we lose sight of most of the value of the land. The market sees only the one-time big profit of the “developer”. It discounts the modest perpetual income of the farmer. It ignores the beauty for each bypasser. The market does not value the groundwater, does not foresee the flood, and does not take into account future taxes for sewers and schools.
To include and protect all kinds of land value, something has to be added to the market, something that expresses the long-term public interest.
On the community level zoning is one option. It can protect such vital functions as groundwater recharge and floodwater control. It helps keep one person’s “development” from putting a tax burden on others.
But zoning can’t pick out particular pieces of land that urgently need protection. It can be the kiss of death to farmland, which is often physically well-suited for “development” and zoned that way. And zoning is subject to so many exceptions, revisions, political deals, and conflicts of interest that it requires constant vigilance from the citizenry to be effective.
Another tool for protecting land is the acquisition of development rights. New Hampshire, for example, has a small fund to buy development rights to farmland. The farmer who sells those rights continues to own the land, manages it, lives on it, earns money from farming and logging it, and can sell it. But the deed is restricted so that no owner, now or in the future, can “develop” it. The state acquires only one right in the deal — the right to enforce that restriction.
Land trusts, conservation organizations, and towns can also acquire development rights to land. They can do a lot with a little money, because a purchase of development rights is less expensive than an outright purchase of land. The land remains in private hands, on the tax rolls, and marketable. And a whole new market in protected land is created. In that market prices are set not by “developers” but by farmers, at levels that reflect the yield of lumber or hay — which means at levels that farmers can afford.
Senator John Chafee of Rhode Island is preparing a bill to generate as much as $1 billion per year in an Outdoor America Fund for governments and local land trusts to use to protect land. The money would come from federal income from mineral and timber leasing, and perhaps from a small real estate transfer tax.
Would that be yet another Äederal spending boondoggle? I don’t think so, for all the economic reasons I’ve given here. It would be a great investment, which would go on paying off for generations. And the sooner it’s done, the better the investment will be.
About a year ago I was trying to find $150,000 for a local land trust to protect 320 acres of New Hampshire land. I ran into a friend who was working for a land trust on Cape Cod, where “development” is far advanced and land prices are out of sight. Her trust wanted to protect a 200-acre parcel. To do it, she had to come up with $3 million.
That’s what happens to the economics of land protection when it’s done too late.
Copyright Sustainability Institute 1987