Green Backlash: The Wind Turbine Controversy

Jim Shaw, owner/broker for Northern Maine Realty in Mars Hill, says that he has had no issues with selling property, living near or renting cabins on the west side of the wind project on Mars Hill Mountain. However, he does say that those on the opposite side of the project must sometimes contend with a noise similar to a low-flying jet aircraft or a waterfall. As far as property values, Shaw says that since there have not been any properties sold to confirm a drop in value, there is no proof of devaluation. When Derry Gardner of Gardner Appraisal Group, Inc. out of San Antonio, Texas, hears that turbines do not affect property values or neighboring property values, he says, “it goes against common sense, which automatically raises a red flag.” He cites market data showing diminished values. He also says it’s important that any value analysis of property use a commonly accepted method such as the paired sales analysis, which is part of the methodology used under the direct sales comparison approach. With that, a property’s characteristics—such as market conditions over time, improvements and location—are considered. Similar properties are then identified and some of the variant features become the reason for the difference in value. Gardner says a 350-acre ranch in Erath County, Texas, is one example. It was purchased at top price for a retirement homestead. The new owner learned that 27 wind turbines were to be placed within a 1.5-mile radius and put the ranch up for sale. A prospective buyer agreed to the sales price but backed out when the turbine project was disclosed. The seller offered a 25 percent discount but the prospective buyer declined, says Gardner. He points to sales of seven rural Texas tracts between March 2006 and August 2007 in which contributory values of improvements were deducted from each sales with all other characteristics considered similar. Properties with turbines averaged a 37 percent decrease in value, properties two-tenths to four-tenths of a mile from turbines had a 26 percent average drop and properties in which turbines were up to 1.8 miles away experienced an average value decrease of 25 percent. According to Michael McCann of McCann Appraisals LLC in Chicago, Ill., “Turbines are large-scale industrial machines/projects, which surround homes, unlike any other large-scale projects. I have never seen a situation akin to wind farms where an industrial zoning ‘overlay’ encompasses and surrounds existing homes. No other industrial, retail or other type of large-scale project gets approved without first buying out the existing residences rather than surrounding them. A home is the biggest investment most people have in their life and deserves value protection from a dominating land use, which generates profits for the developers and is claimed to be for the public good. It would seem that most wind energy companies are unwilling to compensate people fairly for value loss….nor buy them out.” McCann, a Certified General Real Estate Appraiser who has qualified as an expert witness on real estate value and zoning cases in 20 states, has reviewed residential sale data for 46 transactions near the boundaries of Illinois’ first wind project, Mendota Hills, in Lee County that occurred after turbines were erected from 2003 through March 2005, “a strong market overall.” The homes averaged a sale price of $74.63 per square foot, he says. A separate group of sales much further removed from the project averaged $102.94 per square foot. Most homes were older farmstead residences and modest ranch-type homes typical of those found in rural Illinois. He says the sales data reveals that the typical home within a mile or two of project boundaries is 25 percent lower in value than for more distant homes. Some examples range upward of 30 percent and, in softer current market conditions, he anticipates value discounts exceeding 30 percent and perhaps as high as 50 percent. It is important to keep zoning districts separate to provide for compatibility of uses and to protect property values, health, safety and welfare of residents, says McCann. Farm areas have a pre-existing established residential character that is typically a “permitted” use. He says the Obama administration missed the opportunity to require value protection of project footprint homes in the stimulus bill when extending the wind energy tax credits to 2012. “That would have cost the taxpayers nothing and, at worst, would have re-allocated the funds for one percent or two percent of the turbines, which cost about $2 million each,” he says. “Since the turbines do not run at 100 percent of nameplate capacity, no energy would have been lost and homeowners would have been taken fairly into the equation of this wind energy trend.” Benefit Concerns and Wildlife Impacts In 2004, Lisa Linowes and her husband were planning the renovation of an old farmhouse they had purchased when they heard about a wind project possibly coming to their New Hampshire town. With a little digging, she says, she determined that the project was not a good idea and set out on a quest to educate herself and others. In 2006, she and others formed Industrial Wind Action Group to play a proactive, leadership role with fact-based analyses to assist communities and to advise officials at federal, state and local levels. Her immersion in the topic has made Linowes a recognized wind and land use expert. She serves as the group’s executive director and has been invited to speak and to be a panelist at numerous venues across the country, including the 12th annual Midwest Energy Conference of the Midwest Chapter of the Energy Bar Association in March in Chicago. Many issues have arisen about industrial wind turbines not only for homeowners but for taxpayers and nature lovers as some expected benefits turn out to be less than originally estimated and impacts on wildlife, such as bats, begin to be understood. Linowes says she hopes to “put the cold hard facts on the table and to take emotion out of the room.”

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