Amenity Value of Proximity to National Wildlife Refuges

1. Amenity Value of Proximity to National Wildlife Refuges Timothy Hamilton North Carolina State University Camp Resources XVIII

2. National Wildlife Refuges • 502 NWRs in the lower 48 states • Operations = $362m, Maintenance = $140m • ~ 40 million visitors each year • Most open to public • 70% have hiking/walking trails • 60% have visitor facilities • 50% open fishing and hunting • 70% offer educational programs • Habitat conservation

3. Management Problem • NWR establishment removes land from the tax base. • FWS pays $1.65 per acre • By comparison, Cape May refuge in NJ. Average home value/acre implies $1,732 per acre in property tax revenue.

4. Management Problem • However, NWRs provide local communities benefits: • Ecological functions • Recreation benefits to larger community • Localized property value impacts • Proximity to NWR may increase value of nearby homes  increases tax base • Quantification of these benefits continues to be a key challenge for federal agencies

5. Hedonic Valuation • There are dozens of hedonic estimates of the capitalization value of proximity to open space: • Permanent vs. agricultural and/or developable open space • Boyle, Paterson and Poor (2002); Neumann, Boyle and Bell (2009) • Case-study of four NWRs (one near an UA, two more remote) • Obtain transaction data • Hedonic analysis of sales data to determine value of proximity to NWR • 4.8% increase for homes in the urbanized area; significantly less for non-urbanized area.

6. Hedonic Valuation • Broader programmatic approach desired • Census Microdata offers an opportunity to consider broad geographic models • Davis (2011) • Proximity to power plants • Use census microdata across the U.S. • Rabindran and Timmins (2011) • Proximity to superfund site • Use both census and transaction data

7. Study Area • Begin with GIS of all NWR boundaries • Overlay with GIS of all urbanized areas (UA) • Contiguous, densely settled census blocks/groups that meet minimum population density requirements (1,000 people/sq.mile, 500 in surrounding blocks) • NWR boundary must be within two miles of the boundary of an UA (188)

9. Study Area, continued • Final sample must also have: • NWR established in 1999 or earlier • Final Sample: 90 NWRs • Northeast: 34 • Southeast: 20

10. Link NWRs to Census Blocks • Census geography is defined as: • Block: smallest geography available • Typically defined by geography • Population taken into consideration • Census data links household to blocks

13. Proximity to an NWR • Linear distance between census block centroid and NWR boundary is measured • Each census survey is linked to the block in which the house is located

14. Housing Data • Confidential Census Data: decennial census long-form with block identifier • One-in-six sample of entire U.S. • Housing characteristics • Housing type, age of structure, total # rooms, bedrooms, heating type, parcel size (<1, 1-9, >10 acres) • Housing value • Owner-report, 24 categories.

15. Basic Model • Xi = housing/household characteristics • Zb= block characteristics • Kg= neighborhood/block group characteristics • Db = distance of block centroid to NWR • Fixed effects by NWR and tracts

16. Model Covariates • Housing Characteristics • # of rooms and bedrooms, lot size, age of house • Block Characteristics: GIS • Proximity of a block to: • Nearest Interstate Highway • Nearest national or state park • Coastline • Urbanized area boundary • Centroid of the nearest MSA

17. Model Covariates • Other open space • 2001 National Land Cover Database • Based on satellite imagery in 30-meter pixels • Calculate % of each census block in each land classification calculated. • 29 land use categories aggregated to: • % open water • % developed open space • % developed low, medium or high density • % forest • % shrub/grassland

18. Model Covariates • Neighborhood/Block Group Characteristics • Population density • Median family size • Median number of children 18 and under • Median number of adults over 65 • Median household income • % Owner occupied • % Vacant for seasonal use • % Single family detached • % Apartment

19. Impact of Distance to NWR • Continuous Distance • d(Db) = β1Db + β2(Db)2 • Discrete Intervals • d(Db) = β1I[0,.5] + β2I(.5,1] + β3I(1,1.5] + β4I(1.5,2] + β5I(2,2.5] • Omit dummy for block > 2.5 miles from NWR

20. NE Results

21. NE Results: Categorical Distance

22. SE Results

23. SE Results: Categorical Distance

24. NE Results: Illustrative Marginal Effects • Assume value of $250,000 • Categorical model (3 miles to NWR, 8 miles to UA): • Adjacent houses are valued $9,125 higher than those 2.5 - 3.0 miles away. • Continuous Model (3 miles to NWR, 8 miles to UA): • Moving house from 0.25 to 1.25 miles decreases value by $10,775

25. Summary • NWRs appear to provide amenity values as expected • Amenity impact is highly localized (≤0.5 miles). Census track or even block-group data may not be refined enough to identify impacts. Access to block-level data important. • Amenity value tends to be higher for homes closer to densely populated area

26. Policy Implications • Programmatic approach to benefits estimation • Transactions data not available and case-study approach can be difficult for agencies to apply broadly in their programs • Additional tax revenue from (particular) NWR • Calculate average capitalized value across all homes • Using average acres per home, find average increase in tax revenue per acre

27. Policy Implications: Total Capitalized Value for Homes within 8 miles • NE: Total Capitalized Benefits of $55 million across 9 NWRs • Annual tax revenue increase of $69 per acre • SE: Total Capitalized Benefits of $100 million across 21 NWRs • Annual tax revenue increase of $40 per acre

28. Thank You • Questions? Comments?