Testimony of Michael McCann on property value impacts in Adams County IL
June 8, 2010 by Michael S. McCann CRA
Certified appraiser Michael S. McCann submitted this testimony to the Adams County Board, Adams County Illinois in reference the impact of industrial scale wind energy development on residential property. Mr. McCann’s testimony provides a detailed explanation of the impacts he has found and his recommendations to avoid harm to adjacent property when siting projects. An excerpt of his testimony is provided below. The full testimony can be accessed via the link at the bottom of this page.
SUMMARY OF OPINIONS AND RECOMMENDATIONS
1. Residential property values are adversely and measurably impacted by close proximity of industrial-scale wind energy turbine projects to the residential properties, with value losses measured up to 2-miles from the nearest turbine(s), in some instances.
2. Impacts are most pronounced within “footprint” of such projects, and many ground-zero homes have been completely unmarketable, thus depriving many homeowners of reasonable market-based liquidity or pre-existing home equity.
3. Noise and sleep disturbance issues are mostly affecting people within 2-miles of the nearest turbines and 1-mile distances are commonplace, with many variables and fluctuating range of results occurring on a household by household basis.
4. Real estate sale data typically reveals a range of 25% to approximately 40% of value loss, with some instances of total loss as measured by abandonment and demolition of homes, some bought out by wind energy developers and others exhibiting nearly complete loss of marketability.
5. Serious impact to the “use & enjoyment” of many homes is an on-going
occurrence, and many people are on record as confirming they have rented other dwellings, either individual families or as a homeowner group-funded mitigation response for use on nights when noise levels are increased well above ambient background noise and render their existing homes untenable.
6. Reports often cited by industry in support of claims that there is no property value, noise or health impacts are often mischaracterized, misquoted and/or are unreliable. The two most recent reports touted by wind developers and completed in December 2009 contain executive summaries that are so thoroughly cross-contingent that they are better described as “disclaimers” of the studies rather than solid, scientifically supported conclusions. Both reports ignore or fail to study very relevant and observable issues and trends.
7. If Adams County approves a setback of 1,000 feet, 1,500 feet, or any distance less than 2-miles, these types of property use and property value impacts are likely to occur to the detriment of Adams County residences and citizens for which the nearest turbines are proposed to be located.
8. The approval of wind energy projects within close proximity to occupied homes is tantamount to an inverse condemnation, or regulatory taking of private property rights, as the noise and impacts are in some respects a physical invasion, an easement in gross over neighboring properties, and the direct impacts reduce property values and the rights of nearby neighbors.
9. A market value reduction of $6.5 million is projected for the residential property located in the footprint and within 2-miles of the pending Prairie Mills project located in east Adams County.
Therefore, if the County Board should choose to adopt the industry requested minimal setbacks, or some other setback of less than 2-miles from residential uses or occupied dwellings or structures such as schools, churches and nursing homes, I have developed a series of recommendations that would at least partially mitigate the widely experienced impacts prevalent with industrial scale wind turbines developments, as follows:
1. A Property Value Guarantee (PVG) should be required of the developer(s), significantly similar to the PVG attached hereto as Appendix A. A County-controlled fund or developer bond should be required to guarantee no undue delay in PVG payment(s) to legitimately affected homeowners, and/or to buy out homeowners located within 2-miles of any turbines if they elect to relocate away from the turbine project(s) and cannot sell for the pre-project market value of their properties. Such a guarantee is nominal in cost, relative to total project costs, and are used to condition high impact land use approvals such as landfills and even limestone quarries, as well as other wind energy developments (i.e. DeKalb County, Illinois, etc.)
2. An alternative to the bonding element of Recommendation # 1 would be to require that the developer(s) obtain a specialized insurance policy from a high risk insurance carrier or legitimate insurer, such as Lloyds of London, if they will even insure against such impacts. If Lloyds was unwilling to provide such insurance, however, that should be compelling to the County that professional risk-management actuaries find such projects too risky for even them to insure. Under those possible circumstances the burden of risk is fairly placed with the developer, rather than the residential occupants who are being surrounded or otherwise directly impacted by close proximity of the projects.
3. If Adams County decides to permit projects, the limited evidence of impacts beyond a 2-mile setback would mitigate against the need for a PVG as cited in recommendation # 1.
4. If Adams County decides to permit projects, I recommend that the County require developer funding and a plan to constantly monitor not only sound levels in McCann Appraisal, LLC decibels, but also in low frequency noise emissions from the turbines utilizing the best available technology, or at least homeowner reports and logs. There is significant evidence and personal accounts confirming that low frequency sound/noise is “felt” by nearby occupants, and, as I understand it, cannot be measured by decibels as audible noise is typically measured. Disclosure of the owner’s actual experience to prospective buyers is necessary from both an ethical perspective and, I believe potentially under the Illinois Real Property
Disclosure Act, as a “known” defect or detrimental condition. Thus, documentation should be created at the cost of the developer(s), to insure that appropriate disclosures can be made to any prospective buyer(s) of homes within the 2-mile zone.
5. Appropriate devices should be installed at the developers expense at all occupied dwellings and property lines within a 2-mile distance of any turbines, and the County should retain the ability to immediately enforce the shut-down of any turbines exceeding a level of 10 decibels or more above ambient background noise levels from any property/home experiencing that exceeded noise level. The proximity of constant or frequent noise sources is an adverse impact to the use and enjoyment of a residential property, and indicates a basis for loss of property value.
6. An alternative to recommendation # 5 would be to place a limit on hours of operation, requiring turbines within 2 miles of any occupied (non-participating) dwelling be shut off during normal sleeping hours (i.e. 10 p.m. to 7 a.m.).
7. If the County finds that the wind energy projects are desirable from a economic development goal or perspective, or for the “public good”, I recommend that “footprint” and 2-mile distant neighboring homeowners (measured to lot line from the furthest span of turbine blades) be afforded the opportunity to sell to either the developer or the County, with possible use of eminent domain powers employed by the County, on behalf of and at the expense of the developer(s).
8. The financial assurance for decommissioning and reclamation of wind turbine pad sites, i.e., a bonding requirement, is also recommended as a County condition. To demonstrate solvency companies should pay the bond requirements before starting construction. It’s basically insurance in case the company goes bankrupt or otherwise abandons the wind project without taking down the turbines and reclaiming the land. Coal mines, quarries, landfills and drilling companies have similar bond or financial assurance requirements.
9. An aesthetic landscaping requirement for wind project developers to plant mature trees or groves to shield the view between residential properties and turbines. Evergreens planted along property lines and/or other types of trees strategically planted between residential windows and turbines would partially alleviate aesthetic impacts from turbines.
10. The County should consider a moratorium on wind energy project development(s) in Adams County, until such time as:
* A thorough and complete Wind Energy Ordinance is developed and adopted by the County, which incorporates all the protection and authority of zoning, building and health codes.
* Appropriate Conditional or Special Use standards are developed and adopted, to insure wind developers carry the burden of their for-profit projects rather than the hosting jurisdiction(s) and/or neighboring property owners.
* The actual experiences of numerous existing turbine neighbors is documented thoroughly by an impartial group of professionals with appropriate qualifications in the various relevant fields of expertise, i.e., acoustic engineers, medical sciences, valuation professionals, etc.
The preceding recommendations are not intended to be all inclusive or to address all wind energy project issues and impacts. They are intended to address issues that affect the public health, safety and welfare of area residents, as well as their property values.
Mr. McCann’s full testimony follows: