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Getting Around the “Takings” Problem

  • Gregg Easterbrook
  • This year, the ESA is once again on the legislative calendar, and deadlock is likely. But there is a possible solution that would get around the “takings” problem, allow economic growth, and still protect land and species-perhaps more effectively than the current law does. Congress should simply require that, for every new acre of land converted into development, one acre of land elsewhere must be purchased and dedicated to conservation of habitat. The land purchases would be financed by a per-acre fee charged to all building on previously undeveloped land. That means all new development, regardless of whether endangered species are directly affected. The fee would be assessed automatically in conjunction with building permits, obviating the need for complicated lawsuits and impact studies. In return, developers would be freed from most current ESA strictures. The utopian goal of protecting all species everywhere would be dropped from the act, though the government would retain emergency authority for a few rare cases. Call it the build-andsave plan.

    Build-and-save grows out of the idea known as “habitat conservation” which has already shown promise in pilot programs in places like Austin, Texas, and coastal Southern California. A recent study led by Peter Kareiva of the University of Washington concluded that most such plans are scientifically sound. Over the last five years, Interior Secretary Bruce Babbitt has authorized roughly 200 habitat conservation plans, making sensible tradeoffs in which developers are granted security against future ESA lawsuits in return for funding the purchase of blocks of land for habitat conservation.

    Last month, under pressure from orthodox environmentalists, Babbitt temporarily suspended approving the plans. But it’s time for environmentalists to stop viewing all development as evil and to think creatively about using market incentives to achieve species preservation. Even if you accept, as you should, that biodiversity protection is an important goal, it’s hard not to recognize that the ESA employs a cumbersome, species-by-species litigation approach. Some areas of habitat can be plowed and paved willy-nilly if they don’t happen to possess any rare creatures. In other areas, even reasonable economic activity comes to a dead stop over glacial lawsuits regarding the finer points of taxonomy.

    If build-and-save were adopted, not only would there be an end to tedious litigation over what constitutes a moth subspecies, but the percentage of the United States that is placed in conservation status would skyrocket. Under build-and-save, the portion of national territory used as parks, forests, and sanctuaries would grow at the same rate as the developed portion of the country. For the first time, there would be a consistent source of funds to buy up land for new conservation areas. And since land would be acquired through voluntary purchases, not forced federal takeovers, the “takings” issue would basically wither away.

    Indeed, money from the build-and-save fund could be used to negotiate voluntary buyouts of land now locked in “takings” litigation, rescuing frustrated landholders who can neither use their property nor find any buyer who wants acres encumbered by ESA restrictions. Free-market bonus: A share of the build-and-save revenues could be used to establish privately administered nature preserves. These projects (owned by and accessible to the public, but managed by private firms or nonprofit organizations) would enable us to test whether the private sector can manage wildlife-preservation projects better than the government does. In the process, something would be created that the present system lacks: a private economic interest group with a stake in lobbying for land conservation.

    In short, it’s the perfect marriage of the free market and environmentalism. And the costs should be modest. Over the last decade, about 1.5 million new acres per year were developed in the United States. Thus, a build-and-save charge of $1,000 per acre would generate $1.5 billion annually, almost five times as much as the $328 million that President Clinton’s fiscal 1999 budget proposal allots to land preservation. (Of course, once build-and-save went into effect, federal appropriations for land preservation would no longer be needed.)

    As it happens, $1,000 per acre is a pretty good estimate of what it would cost to buy a new acre of “wild” land. Such property generally costs less than prime development land. Duke Power, based in Charlotte, North Carolina, recently sold a 32,000-acre tract in the Jocassee Gorges, a glorious section of the Blue Ridge Mountains, to the state of South Carolina for conversion into preservation land at a price of $656 an acre. A 50,000-acre block of land in the Everglades was recently sold for preservation at $2,670 per acre, a relatively high figure because the land had agricultural value.

    True, $1,000 per acre sounds like a lot, but it will almost always work out to less than one percent of new construction costs. (And the charge could be capped to assure that buildand- save fees never exceeded one percent of the total cost of new development.) For a typical new home on a third-of-anacre lot, the additional cost from build-and-save would be $300, or a mere 0.2 percent of the price of a typical new detached home. As for commercial real estate, if build-andsave had applied to the 78-acre, $625 million Mall of America near Minneapolis, developers would have paid $78,000 into the preservation fund-0.01 percent of the project’s cost. Disney’s $2.5 billion, 10,000-acre Celebration, Florida, development would have been charged $10 million-a mere 0.4 percent of the project’s price tag.

    Of course, everyone wants the lowest possible price for new homes, prepackaged theme towns, or any other kind of construction. But most home buyers probably would not object to paying a few hundred dollars extra if they knew the money was being used for land conservation. Participating in build-and-save would even make buyers of new homes feel less guilty about turning over fresh soil for their dwellings, since for every square foot of land they consumed, an equal amount would be preserved elsewhere. Commercial developers would probably prefer a predictable preservation fee to the roulette wheel of ESA litigation. The beauty of this plan is that it harmonizes the interests of developers and preservationists. Anti-growth forces might even reevaluate their positions once they know that the more the country is developed, the more funds flow into land preservation.

    Since our 2.3 billion-acre nation contains hundreds of millions of acres of undeveloped habitat, the build-and-save plan could operate for many generations before there would be any worry of running out of land. Decisions about where to invest land-conservation funds would be made by a new organization to be modeled on the Nature Conservancy, the highly admired private organization that already does on a local scale what the build-and-save plan contemplates on a national scale.

    Future generations will judge us harshly if we continue to consume land for our needs without setting aside equal amounts for biodiversity and for our descendants. The build-and-save plan would make habitat protection and conservation automatic features of the U.S. economy. Developers could even boast of how their projects were helping to preserve nature, rather than having to apologize for the urge to build.

    Gregg Easterbrook is a contributing editor at The Atlantic Monthly and at U.S. News & World Report. This article, originally published in the March 2, 1998, New Republic, is reprinted by permission. © Gregg Easterbrook. He is author of A Moment on the Earth (Viking) and Beside Still Waters (William Morrow).

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