Category Archives: Property rights

A Closer Look at those Tenant-Eviction Stats

Graphic credit: VPM

Virginia’s eviction-reform movement gained considerable momentum last year when the New York Times, citing data of the Princeton Eviction Lab, published a story asserting that four Virginia cities numbered in the top 10 cities with the highest eviction rates in the country. Richmond supposedly had an eviction rate five times the national average. Armed with this scandalous data, renters rights advocates pressed successfully for changes to state law that make it somewhat easier for tenants to avoid eviction.

Now a VPM (Virginia Public Media) investigation has revealed significant flaws in the data. The first problem is one that I identified shortly after the Times article was published: The reason Virginia cities stood out so prominently in the Top 10 list was not that Virginia laws are tougher on renters but because Virginia’s city/county form of government skewed the data.

A second problem is that Princeton Eviction Lab cobbled together different data sets for different states. The Lab was able to obtain court data directly from 12 states, including Virginia. For the others, they used data from private sources. Continue reading

Taking Some Pain Out of Eminent Domain

Senator Frank Ruff of Clarksville. Taking some of the pain out of eminent domain.

Four successful bills heading for Governor Ralph Northam’s desk may combine into a measurable shift in Virginia’s condemnation laws in favor of the targeted landowners.  They may also spark a race to the courthouse between now and when some go into effect July 1.

The biggest financial impact may come from Senator Frank Ruff’s Senate Bill 1256, which eliminates state tax on any capital gain resulting from the forced sale.  The subtraction for any capital gain applies to both individual and corporate landowners and applies to any transaction after January 1 of this year.  Too bad if you took that check in December.   Continue reading

SCC Examiner Recommends Shorter Transmission Line Towers for Augusta

Image source: Staunton News Leader

Dominion Energy wants to rebuild 17.7 miles of a 500 kV power line through Augusta County to meet the electricity load of its western Virginia customers, and as long as it’s rebuilding the line, increase the height to accommodate an additional 230 kV line should the need for it ever arise. Building a double-circuit structure would add $6.1 million to the project but save between $44 million and $55 million if the utility had to come back later to add the second transmission line.

Local landowners, distressed by the visual impact on their property, oppose the higher line, and they want Dominion to pay between $1.3 million and $2.5 million extra to add a coating that would give the bright galvanized steel a brown color.

In a ruling issued earlier this month, State Corporation Commission hearing examiner Ann Berkebile ruled that the rebuilding of the existing Dooms-Valley 500 kV line is justified by the public convenience and necessity but that spending the additional money for taller towers is not. Further, she found that the expenditure of additional money to chemically dull the towers is warranted. The case now goes to the SCC’s three judges for a final ruling. Wrote Berkebile:

The ability to address a need that could arise at some time in the future at an incremental increased cost (and at a lower cost than is likely to be incurred should a future need arise) does not outweigh the actual detrimental impacts of significantly taller towers upon the scenic and historic assets of August County. Under the circumstances, I conclude that the Commission should approve the use of less expensive, shorter lattice towers for the rebuild.

Berkebile’s findings come at a time in which Dominion and other electric utilities are investing massive sums to upgrade their electric grids. Over the next 15 years, Virginia likely will see the retirement of more coal-fired plants and the construction of more solar farms and gas combustion-turbine plants. An open question is whether Dominion will be able to re-license its four nuclear power units. The grid, designed for a traditional configuration of electric-power generation also will need to be upgraded to meet a new configuration in which intermittent solar and wind sources play a role.

Dominion consulting engineer Peter Nedwick identified three scenarios that would support the need for the additional 230 kV line through Augusta County, according to Berkebile’s summary of the testimony. In her report, however, Berkebile did not discuss the scenarios or assess how likely any one of them was to occur. SCC staff, she stated, was “unable to verify” a need for taller towers to accommodate a 230 kV line.

In his testimony, Nedwick also cited three instances in which single-circuit structures proved inadequate and Dominion was required to come back and rebuild transmission lines within a double-circuit structure. Given the relatively low cost of preserving the flexibility, summarized Berkebile, “he continued to support the double circuit option as a means of maximizing the use of existing [Right of Way] while maintaining flexibility to meet future demands and changes in [North American Electric Reliability Corporation] Reliability Standards.

The SCC staff supported the chemical dulling option to reduce the visual impact of the pipelines on the Augusta County landscape. A relatively new product, Natina, gives galvanized steel a brown color. According to a Dominion engineer, testing shows that the coating will not maintain a uniform appearance over time. Also, it will increase rust, be difficult to paint over, and hinder the natural development of a patina on the steel girders. Alternatives include COR-TEN weathering steel, hot-dipped galvanized steel, a chemically dulled (pre-dulled) steel.

Oyster Wars, Viewsheds and Property Rights

An oysterman at work in Virginia Beach’s Lynnhaven River. Photo credit: Associated Press

One might think all Virginians would be delighted by the resurgence of the oyster population in the Chesapeake Bay. But more oysters means more oystermen, and more oystermen means more strange men trudging around the shallows and dragging around ugly cages within the sight of wealthy waterfront property owners.

The resurgence has led to resistance from coastal homeowners who want to maintain picturesque views and has fueled a debate over access to public waterways, reports the Associated Press.

Homeowners say the growing number of oystermen — dressed in waders and often tending cages of shellfish — spoil their views and invade their privacy. Residents also worry about less access to the water and the safety of boaters and swimmers.

Low tides often expose oyster cages, usually accompanied by markers or warning signs that protrude from the surface. In some places, cages float.

“All of sudden you have people working in your backyard like it was some industrial area,” said John Korte, a retired NASA aerospace engineer. “They may be a hundred feet away from someone’s yard.”

In a 2012 lawsuit in York County focused on the right of two oystermen to use property in a residential neighborhood for industrial-scale harvesting and cleaning operations. The new trend goes much further. In Virginia, Maryland and Delaware, homeowners are seeking greater restrictions against oystermen activities that offend their sensibilities. But the oystermen aren’t rolling over.

“Oftentimes, affluent and new members of the community have the point of view that they own the water in front of them, which is really not true,” said Bob Rheault, executive director of the East Coast Shellfish Growers Association. “We need to win back our social license to farm.”

Bacon’s bottom line: The fate of oysters, which are making a comeback in large part to the efforts of oystermen who have an economic incentive to create oyster reefs. Oysters are a keystone species in the Chesapeake Bay. As a matter of public policy, this socially beneficial activity should be encouraged, not discouraged.

But recovery of the oyster population is being stymied, in part, by a massive redefinition of property rights — in the popular culture, if not yet in the law. Owners of waterfront property are effectively trying to extend their property rights into public waterways. They are asserting a right to an undefiled viewshed. When they purchased their property, they paid a premium for pristine water views. When oyster populations revived and oystermen began working shallows in public waters that their forebears had abandoned decades ago, property owners perceived them as interlopers.

This is similar to a trend in other places, most notably in rural areas with gorgeous views of mountains, hills, woodlands, farms, rivers and streams. Once upon a time, Virginians purchased rural property for their productive value as farms or timberland. Over the years, people began buying property for the scenery. They paid a premium price for their views, and they objected to anything — be it a cell tower, transmission line, gas pipeline, or industrial facility — that diminished those views.

Here is a photo of the view I observed last month while dining on the porch of the Pippin Hill Farm winery. The owners had built the winery to take full advantage of the beautiful view. Gauging by the large number of people who visited that Saturday to enjoy meals and indulge in wine tastings, the enterprise is highly successful. Now, imagine someone proposing to disrupt that image. I can guarantee that the winery owners would rise up in opposition — not merely for aesthetic reasons but because their livelihood would be threatened.

I’m not taking sides in the dispute between landowners and energy companies, or property owners and oystermen. I am not even drawing a moral equivalence. Oystermen are working in public waters, while inland landowners object to energy companies using eminent domain to cross their land. I am saying that the rise of viewsheds as a determinant of property value is fueling conflict that did not previously occur. I’m not sure that our system of laws and regulations has caught up.

Will NIMBYs Thwart SolUnesco Solar Plan?

SolUnesco CEO Francis Hodsoll addresses the Albemarle County Board of Supervisors

SolUnesco CEO Francis Hodsoll addresses the Albemarle County Board of Supervisors. Photo credit: Charlottesville Tomorrow.

Not all barriers to solar energy emanate from Richmond. Take Albemarle County, for example. The county zoning code outlaws solar farms, we learn from Charlottesville Tomorrow.

“The current zoning ordinance allows for the transmission and distribution of energy, but not the generation of energy,” said county planner Margaret Maliszewski at Wednesday’s Board of Supervisors meeting.

The issue arose because Reston-based SolUnesco wants to submit an application to develop an 11-megawatt photovoltaic solar energy generation system in southern Albemarle. “Our project is for the wholesale supply of energy that goes onto a wholesale network of transmission and distribution lines and that allows people to buy energy from our project or for a utility to buy energy directly from us,” said SolUnesco CEO Francis Hodsoll.

Albemarle Supervisors directed the planning department to study the issue. But, while the Charlottesville-Albemarle area may be home to many solar-loving greenies, don’t take it for granted that county planners will roll over for SolUnesco.

“As a member of a rural neighborhood, the first thing that comes to mind is protection of the rural areas,” said Phillip Fassieux at the board meeting. “We all love solar power, but at what cost? … “How will residents of Albemarle benefit specifically from turning over part of our rural county to its use? Will we see reductions in electricity rates?”

Everyone loves solar in theory, but opposition frequently surfaces locally when someone proposes building a solar farm near them. Others object to the idea of vast solar farms displacing agricultural uses of the land. SolUnesco’s proposed 11-megawatt solar farm, big enough to supply demand for about 2,000 households, would require between 70 and 80 acres of land. Typically, solar farms include vegetated buffer zones to screen the solar panels from view.

(Another potential objection to solar is that, given the state formula for distributing school aid, a big capital investment in solar could actually hurt a county financially. I’ll deal with that issue in a separate post.)

Bacon’s bottom line: Call me a Neanderthal, but I support private property rights. I see no justification for Albemarle County — or any county — to impose zoning restrictions prohibiting solar farms. If a property owner decides that installing solar panels represents a use of land preferable to agriculture or timber, that should be his decision to make. Counties have no business intervening unless the land use creates a nuisance to neighbors. Unlike wind turbines, solar panels create no noise, are easily hidden from view, and don’t harm wildlife. NIMBYs need to get a life.

And one more thing… The SolUnesco pitch to landowners asserts that its 25-year leases will generate above-market returns for landowners with an inflation escalator. The company assumes all costs and risks associated with developing the project — the landowner just collects checks for 25 years.

Rural Virginia is hurting. It has few resources of value in the knowledge economy. One thing it does have is land. Solar energy represents a rare opportunity for Virginia’s rural economy. There are many complex issues surrounding the integration of solar into the electric grid that need to be resolved before we see widespread deployment, but land use should not be one of them.

Hundreds Seek Pipeline Construction Jobs

Atlantic Coast Pipeline construction will create 7,200 temporary jobs.

Pipeline construction.

The proposed Atlantic Coast Pipeline (ACP) is highly controversial in Augusta County, where property owners fear pipeline construction will jeopardize water supplies, create a safety hazard for nearby residents, and drive down property values. But hundreds of mechanics, welders, electricians and other blue-collar workers see the $5 billion project as a potential boon.

By noon Thursday, 157 people had signed up at the Augusta Expo put on by the ACP to inform local vendors and workers of opportunities to work on the 600-mile pipeline, according to the News Virginian.

At peak construction in 2018, said ACP spokesman Aaron Ruby, the pipeline will employ 7,220 workers.

Wrote the News Virginian:

Scott Bazzarre, the founder and president of Budget Electrical & Mechanical in Palmyra, wants to be considered for electrical work on the pipeline. He calls the pipeline a boon for workers like him and for the economy. “It’s a no-brainer, not just for the tax base but for a struggling economy.”

Unlike landowners, who will have to live with the pipeline as a permanent fixture on their property, construction workers will benefit only for the duration of the construction project. But there are undoubtedly thousands of workers who think like Bazarre: “We have to have good-paying jobs for my kids and grandkids.”

Bacon’s bottom line: Is it a stretch to suggest that the ACP pipeline controversy reflects the same societal schisms as the 2016 election: the propertied, educated class versus blue collar workers struggling to survive economically? Such a framework over-simplifies a complex reality, but I think there’s something to it. Even though Virginia’s unemployment rate stands at 3.7%, theoretically full employment, rural/small town Virginia has a higher jobless rate, and the “unemployment” figures don’t take into account discouraged workers who have dropped out of the workforce. Pipeline construction would throw construction workers a lifeline.

On the other hand, property owners can’t be blamed for wanting to be left alone. The value of land in the Shenandoah Valley is determined increasingly by aesthetics — bucolic rural landscapes, mountain views, wildlife habitats — not by farming/timbering income streams that traditionally determine compensation for land taken by eminent domain. One can argue that Virginia’s eminent-domain laws do not provide fair compensation for lost value.

In any case, Virginia’s blue collar workers have been largely invisible in the pipeline debate until now. Don’t be surprised to see ACP maximize their exposure.

Pipelines Offer Hope, Provoke Despair

Fern and Earl Echols stand near a pipeline marker on their property in Giles County. Photo credit: Roanoke Times

Fern and Earl Echols stand near a pipeline market on their property in Giles County. Photo credit: Roanoke Times

Recent articles have highlighted rural communities that stand to win and lose from proposed natural gas pipeline mega-projects crossing the state.

On the hopeful side, the Daily Press reports that Isle of Wight County economic development director Tom Elder would like to build a lateral line off the proposed Atlantic Coast Pipeline (ACP) to supply gas to the county’s intermodal industrial park. Gas from the interstate pipeline would supplement supplies made available by local gas distributor Columbia Natural Gas.

“If we had a heavy user, there’s some stipulations that Columbia couldn’t provide at this point,” Elder told the Isle of Wight Board of Supervisors.

Said County spokesman Don Robertson: “We’d love to have a gas line at the intermodal park — it’s going to make that park more marketable. … How and when that happens is obviously going to be determined by the amount of funding and the board’s willingness to do that.”

Isle of Wight joins Brunswick County, Buckingham County and others that view natural gas as a potential boon to their industrial development efforts.

By contrast, residents of Newport in Giles County worry that the economy of their small town will suffer from the Mountain Valley Pipeline. “Newport, more than any community in the pipeline’s proposed path, is potentially going to take a direct hit in the heart of our historic district, while avoiding more affluent communities and homes,” lifelong resident Perry Martin told the Roanoke Times.

Initially, Newport residents expressed concerns that the MVP route would run close to a school, recreation center and rescue squad building. When the pipeline company adjusted the route closer to the center of the town, foes said it threatened other assets such as an ante-bellum church and the historic C.A. Hardwick house. If the pipeline exploded — admittedly, an unlikely event — the potential impact zone would encompass those buildings and several others.

Pipeline companies attempt to negotiate with landowners to obtain the right to cross their land, and often adjust their routes if they can’t reach agreement. But sometimes altering the route is impractical, in which case they can invoke the power of eminent domain on the grounds that their projects are a public necessity. Communities along the route of the ACP in Augusta, Nelson and neighboring counties voice similar fears to the residents of Newport.

“I just don’t understand how people can come in and just take what you’ve worked your whole life for,” said resident Earl Echols. “Where’s 80-year-old people going to go and start over?”

The Cooter Controversy as Window into the New Class/Culture War


Cooter’s in the Country store in Sperryville

by James A. Bacon

Ben Jones, the former actor and Georgia congressman, has built a small retail empire around the character Cooter he played in the “Dukes of Hazzard” television series. In addition to his Cooter’s store in Rappahannock County, Va., he has opened stores in Nashville and Gatlinburg, Tenn. But Jones has to contend with a force more formidable and arbitrary than old Boss Hogg in his home town of Sperryville: zoning laws.

Jones has announced that the Cooter’s store in Sperryville will close because, according to a Wall Street Journal account, Rappahannock County “snobs,” many of whom are refugees from the Washington metropolitan area, won’t let his customers park behind the store, an area zoned agricultural.

“It has become a cause celebre for people who don’t like us,” Jones told the Journal. “They don’t like our store. They don’t like our people. They don’t like our flags. They don’t like our culture.”

Jones, whose politics can best be described as Southern blue dog Democrat, was born poor in Portsmouth, Va. He got his big break playing Cooter, a mechanic who helped the Duke boys and cousin Daisy outwit Hazzard County’s Boss Hogg. He parlayed his celebrity into two terms in Congress in Georgia, then, after losing to Newt Gingrich, he moved to Virginia and built a business on “Dukes of Hazzard” nostalgia. He dabbled in politics here, too, running unsuccessfully against former Congressman Eric Cantor. Tens of thousands of fans attend his show reunions every year.

The owner of the Sperryville land that Jones leases asked the planning commission to recommend rezoning the fields behind the store to allow parking and an eating area, according to the Journal’s account. A few neighbors objected, wondering what might come next. In July the commission urged the county to order Cooter’s to stop using the lot on the grounds that it was an unpermitted extension of a commercial use.

Parking outside Cooter's Place. Image source: RappNews.

Parking outside Cooter’s Place. Image source: RappNews.

Jones frames the issue as a culture clash between local elites who “stare down their noses” at other rednecks like him, and as an example of unresponsive and arrogant government.

Bacon’s bottom line: I find Jones’ argument highly plausible. Educated elites in this country do look down upon white, working class culture — especially that of Southern whites, who are widely considered to be Bible thumpers, gunhuggers and closet Klansmen. Just watch any edition of the Bill Maher show, and you’ll get the idea. Overlay upon that prejudice the Rappahannock zoning controversy in which the right of affluent landowners to live in an unspoiled environment trumps the right of Jones to grow a business and provide employment opportunities for locals. Cultural/economic elites protect their property values at the expense of income opportunities for the working class. (Don’t even get me started on the class implications of conservation easements in which big landowners unload their property tax liabilities while small landowners continue to pay the standard rate.)

I might not have paid this controversy any mind had I not had the strange experience of being solicited twice this summer, a month apart, by different crews of tree cutters claiming to live in Rappahannock County. Both truckloads of mostly white, working class men (one individual was a woman) had traveled three hours to suburban Richmond to cruise neighborhoods and look for gigs. While the Rappahannock County unemployment rate is supposedly around 4%, I’m willing to bet from my singular anecdotal experiences that the rate of under-employment is much higher. I’m also willing to bet that a lot of working poor would jump at the chance to earn a few extra bucks helping Jones run his Dukes of Hazzard extravaganzas.

While it is unlikely that the economic fortunes of working-class Rappahannock residents will rise or fall upon Jones’s ability to expand his Sperryville activities, the symbolic value of the controversy is momentous. The white, rural working class is the bedrock of Donald Trump’s electoral support. Is there any doubt why they feel like the system is stacked against them? Whether their highly flawed candidate wins or loses the 2016 presidential election, is there any doubt that  cultural snobbery and class conflict will persist?

Haymarket Project More than Amazon’s “Extension Cord,” Dominion Says

electric_cordDominion Virginia Power would have to upgrade its electricity distribution system to the Haymarket area of Prince William County sooner or later, even without the development of a data-center campus, testified Mark R. Gill, an electric transmission planning engineer with Dominion, in State Corporation Commission testimony filed yesterday.

“Without the request for service to the Haymarket Campus the Project would not be needed at this time; however, the high likelihood for nearby load growth, as showed in Prince William County’s own Build-Out Analysis, indicates that the Project would be needed at some point in the future to maintain reliable service in the area,” said Gill.

According to the build-out analysis, 8.5 million square feet of non-residential development and at least 889 residential units could be developed in Dominion and Northern Virginia Electric Cooperative (NOVEC)’s service territory around Haymarket, Gill said.

Gill was responding to earlier testimony by SCC staff engineer Neil Joshipura that in the absence of data centers proposed by an electric customer widely presumed to be Amazon Web Services, the electric system upgrade “would not be needed.” Dominion’s estimate for the preferred upgrade is $50 million. An alternative that would entail burying part of the route is estimated to cost $166.7 million.

Neighbors have vociferously opposed the project, fearing that it will obstruct rural views and negatively impact home values. Describing the new line, new substation, and existing line upgrades as a giant “extension cord” for Amazon, project foes argue that the cost of the project should be charged to Amazon rather than Dominion ratepayers generally. By arguing that the improvements will serve homeowners and businesses other than the “customer” presumed to be Amazon, Gill’s testimony buttressed the position that the project should be rolled into the Dominion rate base.


Who Should Pay for Haymarket Transmission Project, Amazon or Ratepayers?

transmission_linesby James A. Bacon

Dominion Virginia Power wants to upgrade its electric grid to serve a new data center campus in the Haymarket area of Prince William County. Residents are up in arms about the potential loss to property values, and the cost of the project could range between $51 million for the least expensive alternative to $166.7 million for the lowest-impact alternative.

The Haymarket project is re-playing familiar controversies bubbling up around the state as Dominion undertakes a wave of improvements to its transmission and distribution system in response to the shift from coal toward natural gas and renewable sources. But this project has a twist. The justification for the project is to serve a single customer, widely believed to be Amazon Web Services (AWS). (Dominion is constrained by a confidentiality agreement not to identify the customer.)

The State Corporation Commission faces two big decisions: (a) Which alternative should it approve, and (b) who should pay for it — Amazon or Dominion rate payers?

Dominion has applied to the SCC for approval to construct a new substation in Haymarket, upgrade an existing distribution line from 115 kV to 230 kV, and construct a new 5.1-mile overhead line. The purpose is to deliver service to a proposed campus expected to house three data center buildings

According to testimony submitted by SCC utilities engineer Neil Joshipura last week, the data centers cannot be served reliably by the existing distribution system and connecting them to the grid would not comply with federal grid reliability standards. While Dominion has demonstrated a need for the project, noted Joshipura, “the Project is needed to serve a new customer, rather than to enhance overall system reliability, and the Staff notes that without the request for service to the Haymarket Campus, the Project would not be needed.”

The SCC has received dozens of letters from Haymarket residents opposed to the project. The area is part of Prince William County’s “rural crescent” slated for lower density development, and residents have famously fought off efforts to develop land near the Manassas National Battlefield Park and, more recently, build the Bi-County Parkway through the area. Most letters express the fear that the power lines would be visually intrusive in a quiet, rural area and would impact property values.

“We did not move to Gainesville 13 years ago to have an eyesore in our back yard,” wrote Peter Menard in a typical statement filed with the SCC.

If a line must be built, citizens tend to favor the “hybrid” above ground/buried cable alternative, although it costs three times as much as Dominion’s preferred alternative.

Citizens also object to the idea of making Dominion ratepayers pay for AWS’s business decision to locate its data center campus in Haymarket rather than Prince William’s Innovation business park. Joseph Knight put it this way in a letter to the SCC:

Amazon chose to buy cheaper land elsewhere in the Haymarket area, knowing that data center expansion is a key factor in Amazon’s overall long-term growth plans and knowing full well that the power at the Haymarket site was totally inadequate to support such an expansion and would require a major power substation upgrade. … Amazon must have intended from the very beginning to lay the entire cost of the upgrade, the property destruction, and the immense loss of value in private property on a wide swath of Western Prince William County.

Dominion classifies the Haymarket improvements as transmission facilities, not distribution facilities, which would make the project subject to the control of PJM Inter-connection, which operates wholesale electricity markets in a 12-state region. As a transmission facility, the improvements would be paid for by ratepayers in the Dominion Transmission Zone, which extends into North Carolina. A residential customer using 1,000 kWh would see a bill increase of $0.09 under Dominion’s preferred proposal and $0.37 under the hybrid proposal, said Joshipura.

Dominion had no comment on Joshipura’s testimony. “We are aware of the SCC staff report, and it’s under internal review,” said Chuck Penn, Dominion spokesman. “We’ll address it in our rebuttal” to be filed tomorrow.

Pipelines Don’t Hurt Home Values, Study Says

pipeline_impactA month after foes of the Atlantic Coast Pipeline issued an economic study showing that the natural gas pipeline would diminish property values along the proposed 550-mile route by $141 million, Dominion Energy has fired back by citing a study claiming that gas pipelines have no impact on residential property values at all.

Analyzing property values in communities in Ohio, New Jersey, Virginia, Mississippi, and Pennsylvania, the report determined that “there is no measurable impact on the sales price of properties located along or in proximity to a natural gas pipeline versus properties which are not located along or in proximity to the same pipeline.”

“These findings might help property owners feel more confident about natural gas pipelines proposed in their communities,” said Don Santa, CEO of the INGAA Foundation in a press release. The foundation is associated with the Interstate Natural Gas Association of America. The bulk of the analysis was conducted by Integra Realty Resources.

The study identified residential neighborhoods that were bordered or bisected by at least one pipeline and compared 200 home sales of similar properties both on and off the pipelines. Study areas included suburban communities outside Cincinnati, Ohio, a rural neighborhood in Clinton, N.J., a master-planned residential community in Prince William County, Va., a suburb outside Jackson, Miss., and a small town subdivision in Dallastown, Pa. Houses were “normalized” by adjusting for gross living area, size, age and other factors.

The INGAA study employed a methodology that compared actual home sales. By contrast, the Key-Log Economics study underwritten by pipeline foes calculated the loss of what it called “ecosystem service values,” which incorporated such intangibles as the loss of viewsheds, air quality and protection from extreme events. Key-Log obtained its per-acre values primarily from a database of more than 1,300 estimates compiled as part of a global study known as “The Economics of Ecosystems and Biodiversity.”

Your assignment: compare and contrast the merits of the two reports.

Pipeline Impact to Property Value and Property Insurability, INGAA Foundation

Economic Costs of the Atlantic Coast Pipeline, Key-Log Economics


Putting a Price on the Priceless


Jamestown archaeological dig site. Photo credit: Daily Press

How does the state put a dollar value on historic, cultural and environmental assets threatened by eminent domain?

by James A. Bacon

In its high-stakes effort to win regulatory approval to build a 500 kV electric transmission line to the Virginia Peninsula, Dominion Virginia Power proposed in December to spend $85 million to mitigate the project’s impact on historical and environmental resources. That’s over and above the estimated $155 million cost to build the 7.7-mile line, which Dominion says is critical to maintain a reliable electric supply to nearly 500,000 residents from Williamsburg to Hampton.

Measures in the draft Memorandum of Agreement submitted to the U.S. Army Corps of Engineers would do nothing to alter the visual intrusion of the 17 towers crossing the James River near Jamestown. But it would allocate $52.7 million to underwrite archaeological work and other improvements in and around Jamestown Island, $15.6 million for water quality improvements, $12.5 million for landscape and battlefield conservation, and $4.2 million to acquire wetlands, restore shorelines and preserve historical resources nearby.

Dominion’s proposal is being circulated for feedback, and there is no guarantee that it will be accepted by the Army Corps, which  is charged with considering the adverse impact of the project on wetlands and historic assets. In the view of some conservationists, nothing can make up for the cluttering of view sheds in and around Jamestown, one of the most important historical sites in American history.

Whatever the Army Corps decides, the MOA still represents a watershed in Virginia regulation. It would be one of the largest sums, perhaps the largest sum, ever proposed to offset the impact of a Virginia utility project on environmental, historic or cultural resources.

“We’ve not conducted an exhaustive file search, but [I] suspect that few final mitigation proposals to resolve adverse effects to historic resources associated with a Corps permit have exceeded a total cost of $85 million,” says Mark W. Haviland, chief of public affairs for the Army Corp’s Norfolk office.

Few spots resonate in the Virginia psyche like Jamestown does, but the state is chockablock with historical sites, cultural sites, landscapes, wildlife habitats and view sheds that many would like to preserve from development. As Bacon’s Rebellion documented recently (see “Clash of Competing Values“), these intangible resources have become so ubiquitous that it is increasingly difficult for energy companies to build gas pipelines or electric transmission lines without crossing multiple assets.

Decades ago, routing pipelines and transmission lines wasn’t the complex task that it is today. It was a relatively straightforward exercise to calculate the fair-market value of farmland, timberland and houses to compensate landowners for lost economic value. But the determinants of economic value for land have evolved. Increasingly, Virginians in rural areas purchase property for the views they offer or the natural habitat they conserve, not for their ability to extract income. Moreover, various public and private entities are identifying habitats and view sheds as worth protecting — historical sites and districts; federal, state and local parks; scenic highways and scenic rivers; private conservation easements and public conservation zones;  and wetlands, wildlife habitat and more.

Can a price tag be put on an acre of habitat for the rare Cow Knob Salamander? How much is it worth to preserve the view from James Madison’s library window at Montpelier? What is the value of an obscure Civil War battlefield such as the indecisive 1864 cavalry clash at Samaria Church in Charles City County?

Much of the conflict between utilities and conservationists stems from regulators’ inability to value intangible assets that loom large in nearly every project, thus making it impractical for utilities to pay meaningful compensation. Dominion’s proposal is significant because it attempts to offset the adverse visual impact on Jamestown-area historical resources by funding the creation of non-visual benefits.

Both utility executives and their foes acknowledge the trade-offs between economic growth, jobs and profits on the one hand and hard-to-value historical, cultural and environmental assets. The great public policy question is what weight should be given to one and what weight to the other.

For years Virginia was a “a manufacturing powerhouse,” says Margaret Fowler, co-founder of the Save the James Alliance and one of the more outspoken foes of the Surry-Skiffes Creek transmission line project. “We were undeveloped, we needed power, we needed factories. Industrialization happened. At some point … we became sensitive to what we were losing — air quality, water quality, visual beauty. Has the pendulum swung too far? I don’t think so. But I understand the dilemma.” Continue reading

Clash of Competing Values


Map 1: Subdivisions and recreation areas. Proposed Chickahominy-Skiffes Creek transmission line route. (Click for image.)

Virginians need pipelines and transmission lines to keep the economy humming. But we also value our historical, cultural and historical heritage. The trade-offs are getting harder and harder.

by James A. Bacon

In the 1970s engineers at Dominion Virginia Power envisioned the need to increase the supply of electric power to the Virginia Peninsula one day. The logical course of action at the time seemed to be hooking into a 500 kV substation north of the James River in Charles City County, skirting Williamsburg, and plugging into a York County switching station where the power could be stepped down to lower voltages. To secure the route, the company proactively procured easements the entire length. It seemed an example of far-sighted planning.

When the Environmental Protection Agency enacted new toxic-emission standards earlier this decade that would compel Dominion to shut down its Yorktown coal-fired power plants, the company dusted off plans to import electricity from outside the Peninsula. However, taking a close look at the route, Courtney Fisher, an electric transmission siting and permitting specialist, found that many things had changed since the 1970s. Developers had built subdivisions right up to the easement. Environmental laws had became stricter, creating protections for wetlands and waterways. Government agencies had created classes of protected land, such as parks, conservation districts and agricultural/forestal districts. Private landowners had set up conservation easements. Society as a whole placed greater value upon scenic vistas and cultural resources like churches, battlefields, cemeteries and Indian settlements.

Even though Dominion owned the right of way, it didn’t take many public hearings to realize that building a high-voltage transmission line along that route would be a public relations disaster. The 38-mile line would cross 28 subdivisions and 300 parcels, leaving 1,129 residences within 500 feet of the line.

“The easement was purchased but the land was never cleared,” Fisher said. “Through the years, people bought houses. Their plats should have showed the easements. Some showed our transmission line easements and some did not. In either case, a line on a piece of paper is very different from the reality.”

Making matters worse, the transmission line would cut through 21 miles of forest land, requiring the clearing of 420 acres of trees, and it would affect 253 acres of wetland and forested wetlands. A crossing over the Chickahominy River would disrupt views to one of the most pristine stretches of river in eastern Virginia. To top it all off, the Chickahominy Indian tribe expressed concerns about the proximity of the line to its lands.

The route would have been so disruptive that Dominion decided to push an alternative, the 7.4-mile Surry-Skiffes Creek route across a historic stretch of the James River, arousing the wrath of conservationists and preservationists in the Williamsburg area and around the state.  As controversial as that proposed route has proven to be, Dominion believes the Chickahominy route would have been worse.

When it comes to picking a route, sometimes there are only painful choices, says Fisher. “We know we can’t please everyone, but we strive to minimize overall impacts.”

As the United States adapts to a post-coal era of more solar, wind and natural gas, major energy corporations are actively seeking to acquire right of way for two major gas pipelines and build several electric transmission lines in Virginia, with more projects waiting in the wings. The problem is that more places on the map are designated off-limits than ever before.

Route of the Williams Companies' Transco pipeline, built around 1950.

Route of the Williams Companies’ Transco pipeline, built circa 1950.

Building gas and electric lines was a lot easier a half century ago when projects disturbed little more than farm and woodlands. Witness the Transco pipeline built through Virginia around 1950 in a straight line. For purposes of acquiring right of way, it was a straightforward proposition to calculate the loss of economic value to a farm or a timber stand to compensate a landowner for an easement across his land.

Since then, suburban sprawl has smeared low-density subdivisions across vast swaths of the landscape, while changing societal values have placed a priority on preserving Virginia’s cultural, historical and environmental resources. Try assigning an economic value to a family cemetery, an expanse of marsh grass or the bucolic view from a vineyard.

Gas and electric companies follow a standard procedure when plotting routes for pipelines and transmission lines. The preliminary step is to plot the most economical path from Point A to Point B, using detailed maps identifying terrain features as well as environmental, historical and cultural assets in the path. Within the budget constraints of the project, they are willing to zig and zag to avoid sensitive locations. If it is impractical to steer around a subdivision, wetlands or scenic vista, utility companies endeavor to minimize the impact — whether drilling through mountains, in the case of pipelines, employing low-glare materials to build a transmission line, or utilizing any number of other strategies. Then begins the open houses and meetings with affected landowners, federal and state agencies and other interested parties to refine the proposed routes further.

A particularly thorny set of issues revolves around how much money utilities should spend in order to avoid or mitigate these conflicts. If a pipeline or transmission line diminishes viewsheds and destroys economic value, how much of that cost should be shifted to rate payers and how much should be absorbed by the property owner? And what happens if a historic, cultural or environmental asset is priceless? Bacon’s Rebellion will explore those issues in an upcoming article.

However those issues are decided, Virginia will be seeing more of these conflicts. To show how challenging it can be to plot a route, Bacon’s Rebellion sat down with Fisher to discuss the challenges posed by the Chickahominy-Skiffes Creek route and with Robert M. Bisha, director-environmental business for Dominion Resources, to walk through the major choke points in the proposed Atlantic Coast Pipeline. Continue reading

Why T.J. Deserves a Place in Our Pantheon of Heroes

TJ-statueby James A. Bacon

Students at the College of William & Mary have carried on a long tradition of festooning the campus statue of Thomas Jefferson with accouterments ranging from woolen scarfs to party hats. The latest fad is to append the effigy with sticky notes denouncing the founding father as a slave holder, a racist and a rapist. The activity imitates a similar movement on the University of Missouri campus, which has been coupled with a petition to remove a Jefferson statue on the grounds that it was offensive to idealize someone who owned and raped slaves. I don’t know if the anti-Jefferson movement will gain the same momentum at William & Mary, a public university in a state where Jefferson is revered like no other historical figure. But, given the tenor of the times, some kind of debate is inevitable.

TJI find the negative sentiments expressed in the sticky notes to be indisputably true at one level and profoundly misinformed at another. True, by today’s standards, Jefferson’s views and behaviors were reprehensible. He did own slaves. He did sell slaves and break up slave families. He most likely (though not indisputably) did keep a slave woman as a concubine. He did believe blacks to be inferior to whites. It is not unreasonable to ask why, for all his brilliance as an author of the Declaration of Independence, a United States president, an architect, the founder of the University of Virginia, and all-around polymath, we should continue to hold him in such high esteem (or, for that matter, why we should esteem any member of Virginia’s slave-holding aristocracy).

The case I would make for Jefferson (along with James Madison, George Washington, Patrick Henry and George Mason) is not that they reflected 21st-century sensibilities, which they clearly did not, but that they articulated values and principles for the first time in history that laid the foundation for the values we hold today. We could not have gotten to where we are today had Jefferson & Company not laid the groundwork.

Colonial America imported its institutions and mental constructs from a Europe that was emerging from the Middle Ages. Collective entities such as towns, cities, guilds, social classes and ethnicities — not individuals — were imbued with rights. When Nathaniel Bacon led a revolt against the autocratic Governor Berkeley of Virginia in 1676, leading a rag-tag band of impoverished farmers and freed slaves, he called for a restoration of the “rights of Englishmen.” Virginians were entitled to rights and privileges, embodied in the Magna Carta and common law that their ancestors had fought for and won. But those rights were not regarded as universal; they were peculiar to Englishmen and derived from English institutions. Jefferson’s great contribution was to draw from Enlightenment-era principles to argue that all men were endowed by their creator with inalienable rights, including life, liberty and the pursuit of happiness. Essentially, he reinterpreted the rights of Englishmen as rights applied universally to everyone. In Jefferson’s formulation, rights did not belong to collective entities; they belonged to individuals, and they were intrinsic to a person’s existence as a human being — the core principle of 21st-century political thought.

What is perhaps most remarkable about Jefferson is that he articulated principles in direct conflict with his own material self interest as a slave holder. While Jefferson indisputably failed to live up to his own principles, it is intellectually facile and lazy to end the discussion there. It is a truism (and one of Karl Marx’s few useful insights) that economic and social classes, both the rulers and the oppressed, create ideologies that support their material self interest. One must ask: How many ruling elites in the history of mankind have ever developed a governing philosophy that undercut their material self interest? How many ruling elites in history have wrestled with the dichotomy between those principles and the way they actually lived their lives, as Jefferson, Madison, Washington and others did? The answer: precious few. Indeed, I cannot off-hand think of any other ruling elite in the history of mankind that has done such a thing.

Jefferson articulated principles that most Americans, including the people who now despise him, hold dear today. We should revere him for making the leap from rights rooted in collective entities to rights applying to all. We should respect him for making that leap in contravention of his own material self interest, and appreciate the fact that the contradiction haunted him until his dying day, even if he failed to free all his slaves and impoverish himself in the process. The journey to equal rights for all Americans certainly did not end with Jefferson, but it started with him, and he rightly deserves a place in our pantheon of heroes.

“Cultural Attachment” the Latest Barrier to Infrastructure Projects?


Take me home, country roads…

by James A. Bacon

Landowner and environmentalist groups have advanced a number of arguments against building more gas pipelines (see previous post), but among the more novel is the idea that the proposed Atlantic Coast Pipeline (ACP) will disrupt the “cultural attachment” rural landowners feel for the land that would be traversed. What foes are contending here is that construction of a pipeline will do far more than hurt property values. It will damage peoples’ culture in ways that cannot be mitigated.

Most arguments against the Virginia pipelines are familiar in the sense that they appeal to widely (if not universally) recognized principles of economics and environmental stewardship. The “cultural attachment”gambit  is not like anything I have seen before.

Here’s how a letter to the Federal Energy Regulatory Commission from some 30 environmental and landowner groups makes the case:

The proposed route of the Atlantic Coast Pipeline will cross primarily rural landscapes where agriculture and forestry are the dominant land uses. The communities that would be affected by the ACP have deep roots in and strong cultural identification with the land and its rural character. In addition to adverse effects associated with the use of eminent domain, construction and right-of-way maintenance … the ACP will have significant adverse effects on the character of these currently non-industrialized areas.

The adverse effects of the taking and alteration of private property … must be assessed in light of the affected communities’ “cultural attachment” to the land. Cultural attachment is the “cumulative effect over time of a collection of traditions, attitudes, practices, and stories that ties a person to the land, to physical place, and kinship patterns.” Much of the land that would be affected by the ACP has been held in families for generations and people’s reliance on the land for survival and prosperity has resulted in high levels of cultural attachment. Rural Appalachian communities have historically suffered from significant intrusions, such as railroad highway constructions, that have “undercut the cultural patterns that had developed through people’s relation to the land, physical place, and kin.

As the U.S. Forest Service recognized in a 1996 Draft Environmental Impact Statement for an Appalachian Power Co. project in rural West Virginia and Virginia:

Substantial outside-generated intrusions (such as highways, railroads, and transmission lines) that breach the boundary of a high cultural attachment area may have significant adverse impacts to the sustainability of the local culture. … The permanence of the intrusions is a symbol of the imposed dominance of commerce and economic interests. … Permanent and elongate linear intrusions tend to bifurcate previously existing cultural units into new units. This tends to fracture informal support systems and create new boundary areas. Boundary areas created by intrusion are often abandoned by area residents from cultural management, thereby increasing the likelihood of additional intrusions.

Bacon’s bottom line: It strikes me that this argument is getting at something real. Some people feel an attachment to the land so strong that it transcends the monetary value of the land. Disruption to these ties cannot be measured by any conventional means, thus they cannot be compensated.

If the Virginia Department of Transportation wanted to run a highway through my home in western Henrico where I have lived for 13 years, I would be plenty unhappy. But I wouldn’t be devastated. My personal identity is not tied up in the house. I have no ancestral ties here, no spiritual ties. Leaving the house would have no impact on my network of kin and friends. I fully expect to sell the house when I retire and I’m ready to downsize. The house is a commodity in a way that property is not for people with strong attachments to the land.

I sympathize with those who fear the loss of something that can never be retrieved. But I have concerns. The idea of “cultural attachment” is so vague and hard to define that it could be applied to almost anything. There is no way to measure cultural attachment, and there is no way to ascertain the sincerity of the people who claim to have it. If this new doctrine were given legal force, it could be invoked to block any infrastructure project that ran through a rural area, that is to say, almost every road, highway, rail line, transmission line or pipeline ever proposed.

The idea has been around at least 20 years (since the 1996 U.S. Forest Service report at least). It doesn’t appear to have gained much traction since then. It will be interesting to see if FERC gives it any credence.