Real Estate Appraisers & Consultants A Division of Wellington Realty Group Inc. Market Study. Diminution in Value Injurious Affection

Transcription

1 Real Estate Appraisers & Consultants A Division of Wellington Realty Group Inc. Market Study Diminution in Value Injurious Affection Visible Easement Hydro Power Transmission Corridor Analysis Prepared by Ben Lansink AACI, P.App, MRICS Ward Lansink AACI, P.App, DULE, B.Tech (Architecture) December 2010

2 Table of Contents Table of Contents 2 Market Study: Introduction 3 Market Study: Effects of a Visible Hydro Power Transmission Corridor 4 Bruce to Milton 1977 to Example Group A: Vacant Land, Existing Hydro Power Corridor 8 Example Group B: Land with s, Existing Hydro Power Corridor 9 Example Group C: Land with s, New Hydro Power Corridor 10 Paired Sale 11 Steel Towers to replace Wooden Poles s 13 Lazar v. Hydro One, Ontario Municipal Board (OMB) 14 Effects of a Hydro Power Corridor: General Overview 15 Market Study: Conclusion 22 Industry Research 23 2

3 Market Study: Introduction Opinions about power transmission corridors - and their effect on property values - have been discussed for many years. Most people have an opinion regarding hydro power transmission corridors and their effect on themselves, their surroundings, and society. Hydro power transmission corridors are a necessity of modern age. The Final Environmental Impact Statement, Arrowhead Weston Electric Transmission Line Project 1 states: A power transmission corridor may either increase or decrease an individual s perception of a property s worth. This perception is indicative of how much one is willing to pay for the property (the fair market value). Value of property traversed by (or located close by) a power transmission corridor may decrease for a variety of reasons, including: Concern of fear of health effects from electric magnetic fields (EMF). The potential noise and visual unattractiveness of the transmission line. Potential interference with farming operations and foreclosure of present or future land uses. On properties that are being farmed, installation of a power transmission corridor can remove land from production, interfere with operation of equipment, create safety hazards, and foreclose the opportunity to consolidate farmlands or develop the land for another use, such as a large scale livestock operation. Are hydro power transmission corridors safe? Are there health impacts related to hydro power transmission corridors? Would someone choose to live close to a hydro power transmission corridor? If a hydro power transmission corridor crossed a property, would that property have the same market value as without the power corridor? Are crops under a hydro power transmission line affected by the power corridor? Does a hydro power transmission corridor cause an increase or decrease in property value? There may be endless questions from a potential buyer and/or seller when dealing with a property affected by a hydro power transmission corridor. When considering property value, these questions are difficult to quantify; however, the overall impact of a hydro power transmission corridor can be analyzed within the actions of an open real estate market. This study endeavors to isolate any loss in value caused by a hydro power transmission corridor. The construction and use of a hydro power transmission corridor is an event over which the property owner has no control. Each example in this study illustrates some type of harm or injurious affection that can be caused to a real property as a result of a hydro power transmission corridor. The harm may be real or perceived and it may be different for each property and to each property seller and buyer. This study analyzes specific examples that occurred within the open real estate market value in order to isolate the impact on property value caused by a hydro power transmission corridor. 1 Final Environmental Impact Statement, Arrowhead Weston Electric Transmission Line Project, Volume 1, Public Service Commission of Wisconsin Docket 05-CE-113, Date Issued October

4 Market Study: Effects of a Visible Power Transmission Corridor Bruce to Milton 1977 to 1986 Background In the late 1970s and early 1980s, an existing hydro power transmission corridor stretched easterly and southerly from the Bruce Transformer Station, Lake Huron, Ontario, Canada. The existing power corridor consisted of a transmission line that ran easterly from the Bruce Transformer Station past the Colbeck Junction in the Municipality of East Luther Grand Valley and a 500kV transmission line that ran easterly from Bruce Transformer Station and turned south at the Willow Creek Jet Junction in Bruce Township. In this era, Ontario Hydro constructed a new (second) 500kV transmission line and corridor from Bruce to Milton to serve the greater Toronto area. This was accomplished by purchasing or expropriating easements over privately owned land. The new 500kV hydro power corridor parallels portions of the existing and the existing 500kV power transmission corridor. The expansion of the corridor consists of a strip of land about 190 feet wide (widths vary) to house the new 500kV hydro power transmission line and the corridor extends from the Bruce Transformer Station to Milton. Source: Hydro One Networks Inc. Environmental Assessment November 2008, modified by Lansink. Between 1977 to 1986, in accordance with the corridor expansion plan, Ontario Hydro purchased numerous properties (on the open market) and resold the properties (on the open market) after creating an easement for the construction, use, and maintenance - all in perpetuity of the additionally required strip of land to house the new 500kV hydro power transmission line. 4

5 Market Study In this market study, properties bought and sold by Ontario Hydro were identified and analyzed. To estimate any diminution in value and the resulting injurious affection due to a hydro power corridor over 60 properties were analyzed, of which 37 properties are detailed in this study. All but two of the properties were purchased and sold by Ontario Hydro in the 1977 to 1983 era. The remaining two properties were purchased and sold by Ontario Hydro in the 1990s. It has been argued that the Ontario Hydro purchases should not be considered open market sales as they do not meet the willing seller/willing buyer, open market concept. It may be considered that the purchases were made under a direct or an implied threat of expropriation, and theoretically at least, are not free and voluntary. However, when purchasing the property, Ontario Hydro received and accepted a deed signed by a grantor (seller). In each deed analyzed in this study, the following remarks and explanations regarding the market value of the lands and other entitlements (compensation) were stated: total consideration $X represents Ontario Hydro s opinion of the market value of the lands; and $Y represents entitlements which would have been paid under The Expropriations Act had the property been expropriated by Ontario Hydro. The consideration that Ontario Hydro paid for the land in the transactions analyzed in this study is stated to be the market value of the lands and therefore all transactions analyzed in this study represent fair market value. An example of part of a typical deed Affidavit is shown below: 5

6 Once Ontario Hydro took the land requirements for the new 500kV hydro power transmission line, it marketed and sold the lands (via the open market), providing an Affidavit stating the Total Consideration. For each property purchase analyzed in this study, Ontario Hydro signed a deed that included an Affidavit stating the Total Consideration that represents Ontario Hydro s opinion of the market value of the lands. To determine the diminution in value (if any) after the easement, each property sale and resale was analyzed. The Ontario Hydro purchase price (before) was compared to the Ontario Hydro sale price (after). With regards to marketing, it is believed the majority of the properties were sold by a Realtor and had been exposed to the open market. It seems logical that a meeting of the minds has occurred when a purchaser acquires rights for an advertised price and that such a sale constitutes competent market evidence. Also, Ontario Hydro is a public corporation and as such it must obtain fair market value for any property it sells. It does not give an equity gift to a stranger. This further supports the assumption that all transactions analyzed in this study represent fair market value. Also, during the sale and resale period, it is understood that no other changes were made to the properties detailed in this study. The properties studied were grouped into the following example groups: Example Group A Vacant Land, Existing Hydro Power Corridor, Visible Easement Example Group B Land with (s), Existing Hydro Power Corridor, Visible Easement Example Group C Land with (s), New Hydro Power Corridor, Visible Easement The following map indicates the study areas. Source: Hydro One Networks Inc. Environmental Assessment November 2008, modified by Lansink. 6

7 Below is an example of the calculations performed for each property sale and resale: Sale Date 1 (Before) Month Day 1977 Sale Price 1 per Acre $10,000 Sale Date 2 (After) Month Day 1979 Sale Price 2 per Acre $7,000 Adjustment for Time from Sale Date 1 to Sale Date 2 Average Price *: Sale Date 1 (1977) $39,218 Average Price *: Sale Date 2 (1979) $37,535 % Change from: Average Price (Sale Date 1) to: Average Price (Sale Date 2) Sale Price 1 per Acre $ Adjustment ADJUSTED Sale Price 1 per Acre A -4.29% B $10,000 AxB=C -$429 B+C $9,571 Conclusion The property should have sold for (adjusted for time) $9,571 per Acre The property sold for $7,000 per Acre Monetary Loss Percentage Loss (Diminution in Value) -$2, % * Note: Average price includes sold residential property and does not include sold commercial or industrial real property. The average price used to adjust for time is provided by the Canadian Real Estate Association (based on the example property board-specific statistics). 7

8 Example Group A Vacant Land, Existing Hydro Power Corridor, Visible Easement Example Group A illustrates the effect of a hydro power corridor on the property value of vacant land located along an existing power corridor. Illustration Before Transmission Line After + New 500 kv Transmission Lines Summary of Findings Example # Lot Concession Vacant or Existing Corridor Feet to Diminution in Value 1A 5 2 NDR Vacant N/A % 2A 13 2 NDR Vacant N/A -4.76% 3A 6 11 Vacant N/A % 4A 4 12 Vacant N/A % *5A 27 w1/2 4 Vacant No * N/A % 6A 7 1 Vacant N/A % 7A Vacant N/A % 8A 18 W1/2 12 Vacant N/A % 9A Vacant N/A % 10A 16 2 Vacant N/A % 11A 17 2 Vacant N/A % 12A 16, 17 14, 13 Vacant N/A % Average Loss (Diminution in Value) % Median Loss (Diminution in Value) % Min Loss (Diminution in Value) -4.76% Max Loss (Diminution in Value) % * Note: Example 5A was not next to an existing hydro power corridor. 8

9 Example Group B Land with s, Existing Hydro Power Corridor, Visible Easement Example Group B illustrates the effect of a hydro power corridor on the property value of buildingimproved land located along an existing power corridor. Summary of Findings Example # Lot Concession Vacant or Existing Corridor Feet to Diminution in Value 1B 45 E1/2 2 SDR % 2B 2,3,4 3 NDR % 3B 50 3 NDR % 4B 52, 53 3 SDR 1, % 5B 31, % 6B % 7B 1,2, % 8B 22, , % 9B , % 10B , % 11B 26, % 12B 22 10, 11 1, % 13B % 14B 3, % 15B 18, , % 16B , % 17B , % 18B , % 19B 2,3,4 6 1, % 20B , % Average Loss (Diminution in Value) % Median Loss (Diminution in Value) % Min Loss (Diminution in Value) -6.29% Max Loss (Diminution in Value) % Note: The feet to building (distance) from the building/dwelling to the corridor were scaled. 9

10 Example Group C Land with s, New Hydro Power Corridor, Visible Easement Example Group C illustrates the effect of a new hydro power corridor on the property value of building-improved land. Illustration Before No Transmission Line After New 500 kv Transmission Line Summary of Findings Example # Lot Concession Vacant or Existing Corridor Feet to Diminution in Value 1C 6 11 No 1, % 2C 26, 27 5 No % 3C 15 4 No % 4C 16 4 No % 5C 16 5 No % Average Loss (Diminution in Value) % Median Loss (Diminution in Value) % Min Loss (Diminution in Value) % Max Loss (Diminution in Value) % Note: The feet to building (distance) from the building/dwelling to the corridor were scaled. 10

11 Paired Sale This section of the study utilizes the paired sale technique to isolate the effect a hydro power corridor has on property value. Sale 1: 216 Concession 6 East, Elmwood The acre site is improved with a 1.5 storey aluminum clad wood frame building designed and constructed to house a single detached dwelling, an obsolete bank barn, and a small shed. The property has some bush and is estimated to be around 70% workable. The topography is gentle rolling. Concession 6 East is a gravel road. The property is located on the north side of Concession 6 East in a rural agricultural neighbourhood, north of Walkerton and Hanover. The property is traversed by a 230 kv and a 500 kv a hydro power transmission corridor. Sale 2: 442 Sideroad 25 North, Walkerton The acre site is improved with a 1.5 storey brick building designed and constructed to house a single detached dwelling, an obsolete bank barn, and a wood frame shed. The property has some bush and estimated to be around 70% workable. The topography is gentle rolling. It is traversed by a drain and/or creek. Sideroad 25 North is a gravel road. The property is located on the north side of Concession 4 East in a rural agricultural neighbourhood, north of Walkerton and Hanover very close to Sale 1. The property is not traversed by a hydro power transmission corridor. 11

12 Calculations Sale 1: 216 Concession 6 East, Elmwood (with Hydro Power Transmission Corridor) Sale Date 1 May 1, 2008 Sale Price $427,000 Acres Sale Price per Acre $2,806 Sale 2: 442 Sideroad 25 North, Walkerton Sale Date 2 Apr 1, 2010 Sale Price $370,000 Acres Sale Price per Acre $3,659 Sale Price 1 Adjustment for Time from Sale Date 1 to Sale Date 2 Average 3 Month Residential Price: Sale Date 1 (~ May 2008) * $206,403 Average 3 Month Residential Price: Sale Date 2 (~ April 2010) * $219,324 % Change from: Average Price (Sale Date 1) to: Average Price (Sale Date 2) Sale Price 1 $ Adjustment ADJUSTED Sale Price 1 (to match date of Sale 2) A 5.89% B $2,806 AxB=C B+C $165 $2,972 * The average residential price as reported by Canadian Real Estate Association (CREA), Grey Bruce Owen Sound. The passage of time calculations are based on the average price during a three month 'smoothed' period that includes the month the similar property sold. Conclusion Sale 2 sold for $3,659 Sale 1 sold for (adjusted to match date of Sale 2) $2,972 Difference $ -$687 Difference % (Diminution in Value) % 12

13 Effects of a Visible Hydro Power Corridor Easement: Steel Towers to replace Wooden Poles s This section of the study illustrates the effect on property value when an existing hydro power corridor is widened and higher towers are installed. The Township of Clearview is located approximately 100 kilometers northwest of Toronto and consists of the west portion of the County of Simcoe. The area includes Collingwood, the Blue Mountain ski resorts, golf destinations, and Wasaga Beach on the shore of Georgian Bay. During the 1990s, Hydro One intended to increase the width of an existing 100-foot wide hydro power corridor easement by 20 feet and replace the existing 35-foot high wooden poles with 130foot high metal towers. The existing 100-foot wide easement has wooden poles and anchors, with guys, braces, and string wires housing a 44kV line and a 115kV line. The new towers will house a line. Due to the proximity of the Collingwood Airport, some of the transmission lines may need to be lit by red aircraft warning lights. Hydro One purchased numerous properties (on the open market) and resold the properties (on the open market) after creating an easement for the construction, use, and maintenance - all in perpetuity of the additionally required strip of land to house the hydro power transmission line. To determine the diminution in value (if any) after the easement, each property sale and resale was analyzed. The Hydro One purchase price (before) was compared to the Hydro One sale price (after). Summary of Findings Example # Lot Vacant or Existing Corridor Proposed Corridor Diminution in Value 1D 1270 Fairgrounds Road 44kV and 115kV % 2D 1636 Centre Line Road 44kV and 115kV % Average Loss (Diminution in Value) % Median Loss (Diminution in Value) % Min Loss (Diminution in Value) % Max Loss (Diminution in Value) % 13

14 Effects of a Visible Hydro Power Corridor Easement: Lazar v. Hydro One, Ontario Municipal Board (OMB) In Lazar v. Hydro One, Ontario Municipal Board (OMB) File LC010005, June 11, 2002, OMB Decision No. 0781, the issue was to determine if there was injurious affection caused by the widening of an easement and the erection of 130-foot metal towers on the easement. The Lazar property is within The Township of Clearview, as described in the previous example. The appraiser for Hydro One claimed that the towers had no impact on the value of the lands; however, the appraiser for Mr. Lazar conducted a thorough market analysis that supported a negative impact caused by the towers. The Ontario Municipal Board was satisfied that the erection of the towers would have an injurious effect on the value of the lands. The OMB decided that [the injurious affection] would be in the range of 30% to 54% based on open market evidence gathered and analyzed by an AACI. In Lazar, the Ontario Municipal Board concluded -30% injurious affection and the decision was not appealed by Hydro One. 14

15 Effects of a Hydro Power Corridor: General Overview There are real or perceived effects, risks, and concerns when a hydro power corridor is constructed, used, and maintained. There are many reasons why property buyers discount the price of land near hydro power corridors. A particular concern to property owners, and property buyers, is the proximity of the land to a hydro power corridor. Electric and magnetic fields are strongest when close to their source. As you move away from the source, the strength of the fields fades rapidly. This means you are exposed to stronger electric and magnetic fields when standing close to a source (e.g., right beside a transformer box or under a high voltage power line), and you are exposed to weaker fields as you move away. Source: Health Canada Website: Healthy Living/Electric and Magnetic Fields at Extremely Low Frequencies, The following section of this study provides examples of possible effects, risks, and concerns related to a hydro power corridor. Human Health Risks Childhood Leukemia The evidence that power lines and other sources of ELF are consistently associated with higher rates of childhood leukemia has resulted in the International Agency for Cancer Research (an arm of the World Health Organization) to classify ELF as a Possible Human Carcinogen. Source: BioInitiative Report: A Rationale for a Biologically-based Public Exposure Standard for Electromagnetic Fields (ELF and RF), Childhood Cancer Scientists at Health Canada are aware that some studies have suggested a possible link between exposure to ELF (extremely low frequency) fields and certain types of childhood cancer. After a recent evaluation of the scientific data, the International Agency for Research on Cancer classified ELF magnetic fields as "possibly carcinogenic" to humans based on studies of childhood cancer. Source: Health Canada Website: Healthy Living/Electric and Magnetic Fields at Extremely Low Frequencies, Other Childhood Cancers [the study] looked at what risks for cancer a child would have later in life, if that child was raised in a home within 300 meters of a high-voltage electric power line. For children who were raised for their first five years of life within 300 meters, they have a life-time risk that is 500% higher for developing some kinds of cancers. Source: BioInitiative Report: A Rationale for a Biologically-based Public Exposure Standard for Electromagnetic Fields (ELF and RF), 15

16 Adult Cancers A very recent study by Lowenthal et al. (2007) investigated leukemia in adults in relation to residence near to high-voltage power lines. While they found elevated risk in all adults living near to the high voltage power lines, they found an OR of 3.23 (95% CI = ) for individuals who spent the first 15 years of life within 300 m of the power line. This study provides support for two important conclusions: adult leukemia is also associated with EMF [electrical magnetic fields] exposure, and exposure during childhood increases risk of adult disease. The evidence for a relationship between EMF exposure and adult cancers and neurodegenerative diseases is sufficiently strong at present to merit preventive actions to reduce EMF exposure. For a decade, there has been evidence that human breast cancer cells grow faster if exposed to ELF at low environmental levels. This is thought to be because ELF exposure can reduce melatonin levels in the body. The presence of melatonin in breast cancer cell cultures is known to reduce the growth of cancer cells. The absence of melatonin (because of ELF exposure or other reasons) is known to result in more cancer cell growth. Source: BioInitiative Report: A Rationale for a Biologically-based Public Exposure Standard for Electromagnetic Fields (ELF and RF), Chronic Effects Scientific evidence suggesting that every day, chronic, low-intensity ELF [extremely low frequency] magnetic field exposure poses a possible health risk is based on epidemiological studies demonstrating a consistent pattern of an increased risk of childhood leukemia. A number of other diseases have been investigated for possible association with ELF magnetic field exposure. These include other types of cancers in children and adults, depression, suicide, reproductive dysfunction, developmental disorders, immunological modifications, neurological disease and cardiovascular disease. Source: Environmental Health Criteria 238, Extremely Low Frequency Fields, Section Published under the joint sponsorship of the International Labour Organization, the International Commission on Non-Ionizing Radiation Protection and the World Health Organization, Airborne Pollutants High-voltage power lines produce [airborne] clouds of electrically charged ions as a consequence of corona discharge [an electrical discharge brought on by the ionization of a fluid surrounding a conductor]. It is suggested that they could increase the deposition of airborne pollutants on the skin and on airways inside the body, possibly adversely affecting health. where the electric fields produced by overhead power lines interact with airborne pollutant particles in such a way as to increase the harmful effects of these particles on the body. If inhaled, some become deposited in the airways of the respiratory system. Since charged particles are more likely than uncharged particles to be deposited when close to the walls of the respiratory airways or to the skin, an increase in the proportion of particles that are charged could lead to an increase in adverse health effects. Fews et al. (1999b) suggested that such an increase could arise from the generation of corona ions by power lines. 16

17 Source: Environmental Health Criteria 238, Extremely Low Frequency Fields, Section 4.7 Published under the joint sponsorship of the International Labour Organization, the International Commission on NonIonizing Radiation Protection and the World Health Organization, Depression More recent studies used validated depression scales. One of these studies showed a clear association between proximity to power lines and depression (Poole et al., 1993). Source: Environmental Health Criteria 238, Extremely Low Frequency Fields, Section 5.3, Published under the joint sponsorship of the International Labour Organization, the International Commission on NonIonizing Radiation Protection and the World Health Organization, Suicide In a review of ICNIRP [International Commission on Non-Ionizing Radiation Protection] (2003) it was observed that, despite methodological limitations, particularly relating to the earlier studies, the detailed study by Van Wijngaarden et al. (2000) suggested that an excess risk for suicide might exist. Source: Environmental Health Criteria 238, Extremely Low Frequency Fields, Section 5.3, Published under the joint sponsorship of the International Labour Organization, the International Commission on NonIonizing Radiation Protection and the World Health Organization, Miscarriage Risk Overall, the studies on residential ELF magnetic field exposure have provided some limited evidence for increased miscarriage risk associated with magnetic field exposure. Source: Environmental Health Criteria 238, Extremely Low Frequency Fields, Section Published under the joint sponsorship of the International Labour Organization, the International Commission on Non-Ionizing Radiation Protection and the World Health Organization, Nervous System and Brain Function Changes Exposure to electromagnetic fields has been studies in connection with Alzheimer s disease, motor neuron disease and Parkinson s disease. There is evidence that high levels of amyloid beta [an amino acid in the brains] are a risk factor for Alzheimer s disease, and exposure to ELF [extremely low frequency] can increase this substance in the brain. There is considerable evidence that melatonin can protect the brain against damage leading to Alzheimer s disease, and also strong evidence that exposure to ELF can reduce melatonin levels. Source: BioInitiative Report: A Rationale for a Biologically-based Public Exposure Standard for Electromagnetic Fields (ELF and RF), 17

18 Hypersensitivity It has been suggested that some individuals display increased sensitivity to levels of EMFs [electrical magnetic fields] well below recommended restrictions on exposure. People selfreporting hypersensitivity may experience a wide range of severe and debilitating symptoms, including sleep disturbances, general fatigue, difficulty in concentrating, dizziness, and eyestrain. In extreme forms, everyday living may become problematical. A number of skin problems such as eczema and sensations of itching and burning have also been reported, especially on the face, and, although there may be no specific symptom profile (see Hillert et al., 2002), increased sensitivity to chemical and other factors often occurs (Levallois et al., 2002). Source: Environmental Health Criteria 238, Extremely Low Frequency Fields, Section Published under the joint sponsorship of the International Labour Organization, the International Commission on Non-Ionizing Radiation Protection and the World Health Organization, Distance from a Hydro Power Transmission Corridor Risk of Leukemia A major new study found that children whose birth address was within 200 meters of an overhead power line had a 70% increased risk of leukemia. Children living 200 to 600 meters away from power lines had a 20% increased risk. Source: Power Line Health Facts, Loss of Quiet Enjoyment Helicopter inspections would also occur twice a year. These activities would generally be scheduled to be concurrent with inspection of the adjacent existing transmission lines. In order to ensure that the transmission facilities are operated and maintained in a safe, reliable and efficient manner, management activities within the Project ROW would be undertaken by small crews, generally every seven years. These would include activities such as: periodic tree cutting; soil stabilization; inspection patrols; and selective herbicide application. Source: The November 2008 Environmental Assessment by Hydro One Networks Inc. Interference caused by Maintenance Owners along an existing corridor complain that hydro power corridor maintenance has resulted in messy downed trees and brush left randomly to rot, often across existing paths and trails. Source: Various property owners along an existing corridor as reported to Lansink Appraisals and Consulting 2008/

19 At various times, a range of maintenance activities are conducted with the property owner having no control over when property entry can occur. Inspection of the hydro power lines is conducted by foot patrol and climbing crews. Source: Various property owners along an existing corridor as reported to Lansink Appraisals and Consulting 2008/2010. Interference during Construction temporary access roads are to be constructed within the easement Corridor. Potential effects that occur as a result of access road construction include soil erosion and compaction, increased traffic (dump trucks) and noise from vehicles. Source: The November 2008 Environmental Assessment by Hydro One Networks Inc. Interference with Vegetation The hydro power corridor operator has the right to control all land uses within the corridor including removal of vegetation which can include crops. Source: The November 2008 Environmental Assessment by Hydro One Networks Inc. Noise Emissions Owners along an existing corridor complain that the hydro power lines emit a buzzing noise that is considered above a hum. The noise depends on the weather, the observer's location, and observer s proximity to the hydro power line. Source: Various property owners along an existing corridor as reported to Lansink Appraisals and Consulting 2009/2010 and personal inspection by Lansink Appraisals and Consulting inspectors. Livestock Related Health Risks/Affects Cow Behaviour Issues and Lower Milk Production behavior, health, and milk production of cows were impaired by transients and by the 3rd, 5th, 7th, and triplen harmonic electrical currents from utility power lines. Primary neutral voltage and 3rd, 5th, 7th and other harmonics on dairy farms were reduced to near zero when a shielded neutral isolation transformer was installed between the utility and the dairy. Animal behavior improved immediately, and milk production which had been depressed for 3 years, gradually returned to normal within 18 months after installation of the shielded transformer. Source: Electric and Magnetic Fields (EMF) Affect Milk Production and Behavior of Cows; Results Using Shielded Neutral Isolation Transformer, By Donald Hillman, Ph.D., Charles L. Goeke, M.S., and Richard Moser, EE 12 th International Conference on Production Diseases in Farm Animals, Michigan State University, Published by: Shocking News, July 2004, 19

20 Gestation Problems in Seasonally Breeding Animals A large number of studies have been carried out investigating the effects of EMF on circulating melatonin levels in animals, because of the possible links between EMF and breast cancer. The impact of melatonin on reproduction is particularly pronounced in seasonally breeding animals, where the effect varies depending on the length of gestation in order to ensure that the offspring are born in late spring when food is plentiful. Source: Environmental Health Criteria 238, Extremely Low Frequency Fields, Section Published under the joint sponsorship of the International Labour Organization, the International Commission on Non-Ionizing Radiation Protection and the World Health Organization, Problems with Chicken and Bird Development Delgado et al. (1982) reported that weak pulsed ELF magnetic fields affected the early development of chicken embryos examined after 48 h of incubation. Quail embryo development has been reported to be affected by exposure to ELF magnetic fields (Terol & Panchon, 1995). Source: Environmental Health Criteria 238, Extremely Low Frequency Fields, Section 10.3 Published under the joint sponsorship of the International Labour Organization, the International Commission on NonIonizing Radiation Protection and the World Health Organization, Horse Still Birth A horse farmer complained that a horse in foal while in pasture next to an existing 500 kv corridor had an 85 to 95% chance of still birth. When not kept next to the 500kV corridor, the birth rate was normal. Source: Property owner along an existing 500kV corridor as reported to Lansink Appraisals and Consulting when property was inspected. Farming Practices GPS Problems they definitely provide a cone of interference directly under the run. Source: Low Frequency (LF) Amateur Radio; LF Radio Propagation, Aerials, Amplifiers, Transmitters, and Technical Talk, Financial Impact and Loss Overhead lines and structures increase the time and financial costs of applying fertilizer or controlling pests impede the movement of machinery to prepare or harvest crops and restrict the ability of farmers to run metal fences parallel with lines due to the possibility of induced current. Source: NZIER by Peter Bailey and Peter Clough and reviewed by Jean-Pierre de Raad. 20

21 Limitations on Development Potential A parcel of land, say 50 to 100 acres, with road frontage may be vacant or it may have buildings with limited use value. This parcel has development potential for intensive livestock and poultry production use which may be as-of-right permitted via Land Uses (zoning) controls. Poultry, dairy and other livestock herds can be and are affected by stray, tingle, or neutral to earth voltage. Many believe the problem may not be curable if poultry and animals are housed and kept close to a hydro power corridor. While not an issue historically, today the developer will want the buildings set back the greatest distance possible from the road to avoid possible airborne disease transmission from road animal transportation. A hydro power corridor traversing land may exclude or restrict the location for an intensive livestock or poultry building footprint and the as-of-right land uses Source: Observations by land use planners. 21

22 Market Study: Conclusion Market evidence suggests that properties, vacant or building improved, will be harmed or injured by the construction, use, and maintenance of a hydro power corridor. Diminution in value to a property is a result of buyer resistance which may be real or perceived. The construction of a hydro power corridor carrying high voltage electricity across a tract of land creates apprehension in the general public, which makes the property less desirable and thus diminishes the market value of the property. The continuing scientific uncertainty over the adverse health consequences of electric and magnetic fields only serves to perpetuate the debilitating effect of power lines on property values. A real estate appraiser is not expert at electric and magnetic fields and cannot conclude that there are health risks associated with living close to power transmission corridors. A real estate appraiser can only analyze the actions of willing sellers and willing buyers acting in the open market place, sellers and buyers who may believe or who may perceive health risks and other consequences associated with power transmission corridors. Diminution in Value (Min) Diminution in Value (Max) Diminution in Value (Average) Example Group A: Vacant Land, Existing Hydro Power Corridor -4.76% % % Example Group B: Land with (s), Existing Hydro Power Corridor -6.29% % % % % % % Steel Towers to replace Wooden Poles % % % Lazar v. Hydro One, Ontario Municipal Board (OMB) % % % Example Bruce to Milton 1977 to 1986 Example Group C: Land with (s), New Hydro Power Corridor Paired Sale Based upon real or perceived fear and other consequences of the construction, use, and maintenance of a power corridor in the market place, this analysis concludes that there is a diminution in value to a property that is subject to a visible easement such as a power transmission corridor. 22

23 Industry Research The following section of the study provides a selection of references to other industry research supporting the diminution in value related to a hydro power transmission corridor. Delaney/Timmons A survey administered in 1990 suggests that proximity to high voltage power lines is being capitalized into lower values for residential properties. Respondents who had appraised such property report that power lines can affect residential property value to varying degrees under certain circumstances and that the market value of these properties is, on average, 10.01% lower than the market value for comparable properties not subject to the influence of high voltage power lines. Further, the results indicate that even appraisers who had not appraised such property believe that power lines contribute negatively to property value. Source: Cowger/Bottemiller/Cahill Overhead transmission lines can reduce the value of residential and agricultural property. The impact is usually small (0-10%) for single-family residential properties. The greatest impacts have been measured in intensively managed agricultural property (irrigators, etc., and in rural, second (vacation) home developments. Source: J.R. Cowger, Steven C. Bottemiller, MAI, and James M. Cahill. Transmission Line Impact on Residential Property, Right of Way, September/October Arthur Gimmy, MAI In late 1994, Arthur Gimmy, MAI, presented a seminar before the EMF Regulation and Litigation Institute11. In part, the seminar presented a matched-sales analysis of California residential property that indicated diminutions in lot values from properties abutting power line easements of 18% to a whopping 53.8%. Source: David R. Bolton, MAI, Kent A. Sick, Power Lines and Property Values: The Good, the Bad, and the Ugly. The Wisconsin Environmental Impact Statement The potential reduction in sale price for single-family homes may range from 0 to 14 percent. Source: Pages from Final Environmental Impact Statement, Arrowhead Weston Electric Transmission Line Project, Volume 1, Public Service Commission of Wisconsin Docket 05-CE-113, Date Issued October

24 Thomas A Jaconetty there have been several other noteworthy studies. One estimated a valuation loss of only 23 percent for properties in very close proximity to such lines (Colwell and Foley 1979; Colwell 1990). Another suggested a loss of about 10 percent (DeLaney and Timmons 1992). So did a 1993 review of 100 Houston residential properties that abutted a power line corridor, which found that there was a measurable loss of value relative to non-abutting peer properties (Bolton and Sick 1999; Bolton 1994). A late 1994 California matched-sales analysis showed that vacant lot values were adversely affected by percent (Bolton and Sick 1999, 336). Considering all of the market evidence, a value loss of less than 10 percent may be a reasonable expectation for residential properties. The negative impact is possibly greater for other types of properties. Source: Thomas A Jaconetty, Do you want your children playing under those things?: The continuing controversy about high voltage electromagnetic fields, human health, and real property values, Assessment Journal; Chicago; May/Jun The Real Estate Center According to the study, 50 percent of those that sold a home with overhead power lines said the property s market value was adversely affected. Two-thirds of the sellers indicated that a longer market time was required for the property to sell. "Half of homeowners near overhead power lines did not consider homes with overhead power lines," says Jones, vice president and chief economist with Stewart Title Guaranty Company. "Forty-four percent said they would have lowered their offering by an average of 7.6 percent if the home they had purchased had been within 200 yards of overhead power lines." More than 83 percent of residential appraisers indicate a negative influence on property market value arising from the lines, with an estimated average of 4.1 percent reduction in value for homes with high-voltage overhead power lines. Each respondent appraised an average of 54 residential properties near overhead power lines. A similar 84 percent indicate an average 62 days longer marketing period for residential homes affected by power lines. Source: Overhead Power Lines Impact Residential Sales, News Release No. 16, February National Association of Real Estate Appraisers The presence of electricity lines over property causes a reduction in the value of that property because of the perception in the minds of the general public of EMF and the visual impact. Source: National Association of Real Estate Appraisers. Shocking Overheads - Power Lines. Copyright