Study Suggests Downzoning Causes No Loss Of Land Value

Maryland Center for Agro-Ecology http://agroecology.widgetworks.com/index.html

Contact Russell Brinsfield, 410-827-6202, for further information

Report Author: Sarah Taylor-Rogers

Queenstown, MD (December 2003)--Contrary to popular perception, reducing the number of homes that can be built per acre on a section of land, called downzoning, does not necessarily reduce the value of the land, and may increase it, according to a new study by the Maryland Center for Agro Ecology, Inc.

In fact, the value of land on which very restrictive agricultural zoning had been imposed increased or experienced little or no change in the four Eastern Shore and Southern Maryland counties analyzed in the study, which will be presented at a workshop on protecting working lands to be held Monday, December 1st at The Maritime Institute of Technology Training and Conference Center in Linthicum Heights, MD.

A review of previous land use studies done in other states, a second part of the new study, found downzoning done in conjunction with a comprehensive land use plan stabilized land values and protected farm and forest land from sprawl for long periods of time. It found that land values after downzoning were influenced by a variety of factors including whether the downzoning was a part of a comprehensive plan; whether the land was suitable for housing, industry or other non-agricultural uses; how accessible the land was to roads or rail, water and sewer and good schools; and the politics and community values of an area.

“In addition to finding that land values increased or were unaffected, we verified that downzoning protects land when implemented in connection with a comprehensive plan that has identified the land with economic and natural resources value” said Robert J. Etgen, executive director of the Eastern Shore Land Conservancy.

“If true, this is welcome news” said Steve Weber, President of the Maryland Farm Bureau and a board member of the Maryland Center for Agro-Ecology, Inc. “Historically, one of the accepted truths has been that downzoning reduced the value of working land. For many farmers a loss of land value means a loss of their retirement nest egg. So in the farming community, downzoning has remained a controversial idea.

Mr. Weber noted that the study found agriculture land values in Kent County increased after the county downzoned agriculture and forestlands. “This study suggests Kent's experience was not extra-ordinary” he said.

Maryland has a well-established effort to protect working lands, forests and farmlands from sprawl. But the state’s current budget crisis and increasing pressures from development have spurred policy makers to look for innovative ways to continue to protect additional acres. Downzoning is being considered in several more Maryland counties, including Cecil, Charles, and Washington.

“Improved land protection tools that reinforce one another are of utmost importance for success in the land protection game” said Dr. Sarah Taylor Rogers, the study’s lead author. “Money is needed, but good practices will make it go farther and will protect the best working lands” she said.

The study matched four Maryland counties that had downzoned agricultural and forest lands with similar adjacent counties that had not and then using statistical analysis compared the land values in each. The four counties that downzoned were Dorchester, Kent, Calvert, and Talbot and they were matched respectively with Somerset, Queen Annes, Charles, and Queen Annes, which had not downzoned and served as the control or benchmark.

Dr. Royce Hanson, Chair of the Board of the Maryland Environmental Trust and a member of the Board of the Maryland Center for Agro-Ecology, Inc. said the study found “When downzoning is implemented as an integral part of a comprehensive approach to farmland protection, it becomes a critical and indispensable component to the success of that effort.”

Downzoning protects farms, forests, and open spaces from development best when it is established with very few opportunities for exceptions, said John Bernstein, Director of the Maryland Environmental Trust and a co-author of the report. He noted that exemptions such as intrafamily transfers and extra lot creation can undermine the housing density for agricultural lands unless they are conservatively implemented.

"The idea of reducing the number of houses allowed on a given parcel of land puts a lot of people off because they fear they will lose equity in their property" said Harry R. Hughes, former Maryland Governor and Chairman of the Board of the Maryland Center for Agro-Ecology, Inc. "It is possible to complement downzoning with programs that can be implemented at the local level and which can enhance landowner equity over the long run."

As examples, Mr. Hughes noted transferable development rights, sale of development rights to the state or land trusts, installment purchase agreements, and tax credits.

“It may be essential in some areas where downzoning is an unpopular idea to incorporate these policies in order to gain support from landowners” Mr. Hughes said. A previous study of the process for donating land conservation easements also sponsored by the Maryland Center for Agro-Ecology, Inc. suggested several ideas for making the process easier and more profitable for landowners.

That study also found that landowners who donate easements are primarily motivated by the desire to protect their land from development, rather than the potential financial benefits.

“There is a growing awareness that working lands work for everyone, not just the landowner” said Dr. Russell Brinsfield, executive director of the Maryland Center for Agro-Ecology, Inc. “They help clean the air, purify water, conserve resources and provide beauty and a rich cultural heritage to our state.”

For more information, contact Sarah Taylor Rogers at 410-827-8056.

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The Maryland Center for Agro-Ecology, Inc., a non-profit corporation founded in 1999, is dedicated to supporting viable farms and forests. The center funds research and education to provide scientific, academic and citizen support for policies that protect Maryland’s forests and fields. These working lands underpin the state’s cultural heritage, characterize its landscape, and make viable agricultural and forestry possible. The non-partisan group’s goal is to keep farming and forestry profitable while protecting the environment and working lands. For more information on the Maryland Center for Agro-Ecology, Inc., log onto www.agroecol.umd.edu.