Monday, August 18, 2008

Property Rights and Windmills

This story in the NYT describes a textbook property rights conflict that communities face every day. The state of New York wants wind power to be able to compete with power produced from coal or natural gas, so the state offered subsidies to wind companies. The wind companies need to build their wind towers somewhere, so they started buying up property and, more importantly, easements—which are essentially use rights in other people's property. Some landowners are willing to let wind companies build towers on their property (for a price, of course). However, other landowners not only don't want to sell the right to build wind towers on their property to the wind companies, but also don't want their neighbors to allow towers on their property. Wind towers are a major eyesore, and I imagine they make noise. So building a wind tower on your property probably interferes with your neighbor's right to use his property in certain ways (e.g., his right to use his property for a scenic view, or for activities that require peace and quiet). It's your property, but if you sell an easement (use rights in your property) to a wind company to build a wind tower, you may be interfering with your neighbor's use rights in his own property. Land use regulations are intended to resolve these types of disputes—if they're not resolved privately, that is. For example, the local government could enact a zoning regulation prohibiting wind towers in the entire residential neighborhood. But as the NYT article shows, local government officials are notoriously susceptible to capture. Almost counterintuitively, though, local government officials are much more susceptible to capture by homeowners, not businesses or owners of vacant property (who usually want to sell to businesses). Homeowners vote, and vote reliably; businesses and vacant property owners don't vote. The battle described in the NYT article seems to be between homeowners, but I imagine the vast majority of homeowners are on the side that's opposed to the wind towers. The NYT article alleges that the local governments in upstate New York have been captured by the wind companies—and I'm sure they have to a certain extent, since there appears to have been some corruption on the wind companies' part. But without knowing more about the specific circumstances (which probably differ from community to community), I'd venture that it's probably not as clear-cut an issue as the NYT article suggests. What's interesting is that there is no mention of eminent domain in the article. That suggests that it's not a matter of simple land assembly—rather, it suggests a piecemeal collection of properties and easements that don't have to be adjoining to be useful to the wind companies. If that's the case, then those communities can expect contentious battles like these for years to come. Also, I love how the NYT framed this part:

There is no state law governing where wind turbines can be built or how big they can be. That leaves it up to town officials, working part time and on advice from outside lawyers, some of whom may have conflicts of their own. [Memo to NYT: lawyers' conflicts of interest are heavily regulated by states' legal ethics codes.]
Outside lawyers! (Cue scary music.) Advising mere "part time" local officials!! NOOO!!!



I will skip the windmills.

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