[From the U.S. Government Printing Office, www.gpo.gov]
Coastal Zone Information COASTAL ZONE Center 1NF0'GR',N!,t1k7g 'b 0';,N@` 0 E N, T E R an a WkAw " 1rqwa1axnL*A*a Impacts of Recreational Lot and Second Home Development Prepared for CEQ.HUD.ARC 1976 HD 258 .A53 1976 c.2 Other Leisure Home Reports This report is one of several documents produced during the course of thik study, Others include: Subdividing Rural America: Impacts of Recreational Lot and Second Honie Development, Executive Summary, available at the U.S. Government Printi 9 Office. q Recreational Lot and Second Home Development; A Manual for Reviewing Impacts, by the American Society of Planning Officials, published by the Council on Environmental Quality. 1976, a handbook for government officials and planners to assist them in reviewing the environmental and socioeconomic impacts of recreational land development proposals. Recreational Properiies, An Analysis of . the Markets for Privately Owned Recreational Lots and Leisure Homes, by Richard L. Ragatz Associates, Inc., 1974, a nationwide study of the recreational properties market, available from the National Technical Information Service, U.S. Department of Commerce, Springfield, Virginia 22161 (PB-233 148/6WU) or directly from the author at 3660 Donald Street, Eugene, Oregon 97405. A condensed version of these market data appears in the full report of the study group. Recreational Properties in Appalachia: An Analysis of Markets for Privately Owned Recreational Lots and Leisure Homes, by Richard L. Ragatz Associates, Inc., 1974, a market study dealing Specifically with recreational properties in the Appalachian states, available from the National Technical Information Service (PB-244 340). The Subdivision of Virginia's Mountains: The Environmental impact of Recrea- tional Subdivisions in the Massanutten Mountain-Blue Ridge Area, Virginia, by William E. Shands, published by the Conservation Foundation, 1974, a report on the environmental impacts of recreational subdivisions in Virginia, available from the Conservation Foundation, 1717 Massachusetts Avenue, N.W., Washington, D.C. 20036. Second Homes in Great Britain., Some Comparisons with the United States, by Richard L. Ragatz Associates, Inc., 1976, a general assessment of built structures used for seasonal-recreational purposes, available from the National Technical Information Service (PB-258 400). COASTAL ZONE INFORMATION CENTER I.1 . S . DEPARTMENT OF COMMERCE NOAA COASTAL SERVICES CENTER 114`34 S@OUTH HOBSON AVENUE ("HARLE,c,TON SC 294,05-2413 property of CSC Library Impacts of Recreational Lot and Second Home Development Prepared for the Council on Environmental Quality; Office of Policy Development and Research, Department of Housing and Urban Development; and Appalachian Regional Commission by the American Society of Planning Officials, with contributions from the Conservation Foundation, Urban Land Institute, and Richard L. Ragatz Associates, Inc. 1976 T- For sale by the Superintendent of Documents, U.S. Government Printing Office Washington, D.C. 20402 - Price $2.15 Stock No. 040-000-00374-6 . PREFACE Second home developments and recreational lot sales have concerned many people because of their potential negative environmental, economic, and social impacts and because of possible consumer fraud. Legislation has been enacted by the Federal Government and some state governments in response to con- sumer fraud problems, but the other impacts have often remained unregulated by any level of government. This study, sponsored by the Council on Environmental Quality, the De- partment of Housing and Urban Development and the Appalachian Regional Commission, was conducted to assess the seriousness of these problems and to suggest possible remedies. The research was done by th -e American Society of Planning Officials with the assistance of the Urban Land Institute, the Con- servation Foundation, and Richard L. Ragatz, Associates, Inc. The study has taken place over several years and has produced a series of reports. The study concludes that there is a potential for significant adverse impacts from such developments, but these can be mostly ameliorated if developers and government officials work together in the careful planning and development of such projects. Although the energy crisis and economic conditions have sub- stantially reduced the demand for recreational developments, there is a strong possibility that this market will pick up again. Local and state governments should strongly consider taking advantage of the current lull to pass legislation and establish procedures for dealing with the resurgence when it occurs. This study is one in a series of land use studies jointly sponsored by CEQ and HUD in an effort to provide developers and planners with better informa- tion on which to base land use decisions. Acting Chairman Council on Environmental Quality ACKNOWLEDGMENTS This report is the result of a study funded by the President's Council on Environmental Quality (CEQ) in association with the Office of Policy Develop- ment and Research of the U.S. Department of Housing and Urban Develop- ment (HUD), and the Appalachian Regional Commission. The contractors wish to thank especially Edwin H. Clark, Il who served as CEQ's project officer, for his overall guidance and many helpful suggestions throughout the course of the project. Thanks for their assistance in reviewing draft material is also extended to CEQ Senior Staff member William Matuszeski; James Hoben, Program Manager, Division of Community Development and Management Research, Office of Policy Development and Research, HUD; Allan Kappeler, Assistant Deputy Administrator, Office of Interstate Land Sales Registration, HUD; and Orlando Riutort, Community Development Specialist, Appalachian Regional Commission. Many people contributed to the production of this report. The American Society of Planning Officials was responsible for the overall project and final editing. David R. Mosena, Assistant Director- Research served as project director and editor. Other contributions from the ASPO Research Division were made by Frank Beal, Deputy Director; Frank Popper, Senior Research Associate; Linda Wildman, Research Associate; and Patricia McDowell, Research Assistant. The Conservation Foundation conducted the research and prepared initial drafts for the section on environmental impacts under the staff direction of Robert Dennis, Senior Associate, with assistance from William Shands, Executive Director of the Central Atlantic Environment Center, and William Partington, Executive Director of the Environmental Information Center of the Florida Conservation Foundation. Research and initial drafts for the section on economic impacts were prepared by the Urban Land Institute under the supervision ULI Research Director Donald Priest with assistance from Edward Murray, Research Associate, and Randall Scott, Research Counsel. The market research for this study (used primarily in Chapter II) was conducted by Richard L. Ragatz Associates, Inc. Additional consultation and guidance was provided by John Noble at key points in the project. This study is one of the staff activities authorized by the Board of Directors of the American Society of Planning Officials as part of its Sponsored Research Program. The ASPO research program is an independent research activity supported by grants and contracts and devoted to advancing public agency planning practice. Individual research reports are not reviewed for approval by the Board of Directors or by the membership of the Society. TABLE OF CONTENTS CHAPTER 1. EXECUTIVE SUMMARY .................................................... 1 Summary Conclusions .................................................. ...... 2 Definitions ................................................................. 3 Study Methods and Data Limitations .......................................... 4 Major Findings ............................................................... 5 Recreational Properties Market ............................................... 5 Envirom-nental Impacts ............................ I........................... 7 Economic Impacts .......................................................... 8 Social Impacts ............................................................. 10 Regulation of Development ................................................... 11 Recommendations . . @ ........................................................ 12 Local Governments ........ ............................................... 13 State Governments ...................................................... 15 Federal Government ...................................................... 16 CHAPTER 2. A NATIONAL OVERVIEW OF RECREATIONAL LAND DEVELOPMENT ....... 17 National Stock of Recreational Lots ........... ................................ 17 Number of Recreational Lots Subdivided Annually ......... ..................... 20 National Distribution of Recreational Lots ....................................... 20 Characteristics of Recreational Land Developments ............................... 21 Lot and Project Sizes . . @ .................................................... 21 Lot Prices . @ .............................................................. 21 Basic Site Improvements .......... .................................... .... 21 Future Maintenance Responsibilities ........................ ............ -...23 Recreational Amenities ..................................................... 23 Improvement Guarantees .................................................... 23 Use of Recreational Lots ............................. ........................ 23 Speculation ............................................................... 23 Homesites ................................................................. 25 Other Uses of Recreational Lots ........................ ..................... 26 National Stock of Second Homes ......................... ..................... 27 Number of Second Homes Built Annually ....................................... 27 National Distribution of Second Homes ......................................... 27 Shifts in the Distribution of Second Homes .......................... ........... 27 Factors Influencing the Location of Second Homes ................................ 29 Distance Between Second and Primary Homes .......... ...................... 29 Natural Amenities in Second Home Areas ..................................... 29 Characteristics of Second Homes ............................................... 30 Type ..................................................................... 30 Size and Facilities .......................... ............................... 31 Cost ..................................................................... 31 Use of Second Homes ... ..................................................... 32 Occupancy Rates ...... ........ .......................................... 32 Seasonal Occupancy .... ................................................... 33 Rentals ................................................................... 33 Conversion of Second Homes to Permanent Homes ............................. 33 Characteristics of Recreational Land Developers .................................. 34 Factors Influencing the Growth of Recreational Land Development ................. 35 Increased Affluence ............................................... I ......... 35 Increased Leisure Time ........................... ..................... @: - 135 Increased Mobility ......................................................... 36 Consumer Demand ............................... ......................... 36 Marketing ................................................................ 37 The Future Market for Recreational Land ................................... 37 Notes ...................................................................... 39 CHAPTER 3. ENVIRONMENTAL IMPACTS OF RECREATIONAL LAND DEVELOPMENT ... 45 Assessing Environmental Impacts ................... I......................... 45 Impacts Compared to What? ................................................ 45 Impacts Over Time ......................................................... 45 Construction Impacts .......... ;....I... .................................... 45 Use Impacts .............................................................. 46 Off-Site Impacts ............................................................ 46 Cumulative Impacts ......................................................... 46 Unique Environmental Considerations .......................................... 46 Lower Improvement Standards .............................................. 46 Locations in Critical Environmental Areas ..................................... 47 Urbanizing Influence of Recreational Subdivisions .............................. 47 Specific Environmental Impacts ......................... ...................... 47 Local Water Supplies ................................ ...................... 47 Regional Water Supplies and Groundwater Resources ........................... 48 Water Quality ............................................................. 49 Artificial Lake Developments ................................................ 50 Erosion, Siltation, and Landslides ............................................ 51 Hydrology and Floodplains .................................................. 52 Estuaries and Shorelines .................................................... 52 Air Quality ............ .............I ............ I ........................ 53 Solid Waste ............................................................... 54 Fish and Wildlife .......................................................... 54 Critical Environmental Areas ................................................ 54 Aesthetics ................................................................ 55 Impacts on Public Lands ................. : *........ ,............ * ............. 56 Notes ............ ......................................................... 58 CHAPTER 4. ECONOMIC IMPACTS OF RECREATIONAL LAND DEVELOPMENT .......... 61 Assessing Economic Impacts .................................................. 61 Development Characteristics ... ............................................ 61 The Local Economy ...... ........................................ ........ 61 The Local Government ... ................................................. 61 Secondary Impacts ......................................................... 62 Fiscal Impacts on Local Government ............................................ 62 Costs of Facilities and Services .......... .................................... 62 Utilities ................................................................ 62 Roads .................................................................. 64 Schools ................................................................. 65 Police and Fire Protection ................................................. 66 Health and Welfare Services ............................................... 67 General Government Administration ....................................... 67 Revenues Generated by Development ......................................... 68 Net Fiscal Impacts ......................................................... 68 Impacts on the Local Economy ................................................ 70 Community Income .................. I ............ I......................... 70 Development Expenditures ................................................ 70 User Expenditures ....................................................... 72 Multiplier Effect .......................................................... 73 Employment .......................................... .................... 74 Housing Costs and Land Values .............................................. 75 Notes ....................................... .............................. 76 CHAPTER 5. SOCIAL AND CONSUMER IMPACTS OF RECREATIONAL LAND DEVELOPMENT ............................................... .......... : ...... 81 Social Impacts ............. ................. .............................. 81 Changing Rural Culture .... ................................................ 81 Contrasts in Population Characteristics . . @ ...................................... 82 Characteristics of Second Home Owners ..................................... 82 Rural Population Characteristics ............................... ............ 84 Impacts on Recreational Opportunities ........................... ............ 84 Political Impacts ............................................. ............ 85 Attitudes Toward Social Change ..................... ......................... 88 Consumer Victimization .......... ........................................... 89 Consumer Complaints .......... ........................................... 89 Causes of Consumer Victimization ........................................... 90 Recreational Land as an Investment .......................................... 92 Notes ....................... .............................................. 93 CHAPTER 6. PUBLIC REGULATION OF RECREATIONAL LAND DEVELOPMENT ......... 97 Local Regulation .............................................................. 97 Local Regulatory Problems ............... ...................... .......... 97 Lack of Regulations ......... ................................. .......... 98 Inadequate Regulations ................................................... 99 Poor Administration and Enforcement .............. ................... I ... 100 Failure to Recognize Development as Urbanization ... ...................... 101 Trends in Present Practices ........ ........................................ 101 Conventional Standards ................................................. 101 Variations from Conventional Standards ....... ........................... 103 The Role of Property Owners' Associations ................................. 104 New Techniques ......................... ............. ............ ... 105 Regulating Old Subdivisions .............. .............................. 106 State Regulations ........................................................... 107 Controlling Land Development ............................................. 107 Mandatory Local Controls ........... ................................... 107 Statewide Land-Use Plans ............................................... 108 Developments of Regional Impact ......................................... 108 Environmental Impact Review ..... ...................................... 109 Protecting Critical Areas ...................................... ............ 109 General Critical Area Laws ... ...................................... 110 Coastal Zone Management . . . @ ........................... ............... 110 Beach and Shoreland Access Laws ......................................... 110 Shoreland Regulations ................................................... 111 Adirondack Park Agency Act ............................................. 112 State Land Sales Regulations .............................. .............. 113 Federal Regulations .......... .............................................. 114 Interstate Land Sales Full Disclosure Act . . @ ............ ..................... 115 Securities Act of 1933 ...................................................... 117 Truth in Lending Act and the Federal Trade Commission Act .................... 117 Mail Fraud Laws ......................................................... 118 Effectiveness of Federal Consumer Protection Measures ........................ 118 National Environmental Policy Act ........................................ @ A20 Clean Air Act Amendments of 1970 @ ............................ ............ 120 Water Pollution Control Act Amendments of 1972 ............................. 120 Coastal Zone Management Act ................. ............................ 121 Flood Disaster Protection Act .............................................. 121 Federal Income Tax Laws .................. ............ .................. 121 Notes ......... ........................................ .................. 122 SELECTED BIBLIOGRAPHY.. . ............ ............................................. 127 APPENDICES Appendix A. Recreational Land Subdivisions, Lots, and Acres Filed with the U.S. Office of Interstate Land Sales Registration Ranked in Order of Number of Lots, 1974 ......... 135 Appendix B. Second Homes by-Number, Per Cent of Total Second Homes, and Per Cent of Total Housing Units, Ranked by Number per State, United States, 1970 .................. 136 Appendix C. Households Owning Second Homes, Ranked by Number per State, United States, 1970 ..................................................................... _137 Appendix D. Shifts in the Distribution of Second Homes by State, 1950, 1960, and 1970, and Per Cent Change, 1950-1970 and 1960-1970 ....................................... 138 Appendix E. Estimated Ownership of Recreational Properties by Type of Property and Region of the U.S., 1973 ............................................................. 139 LIST OF FIGURES CHAPTER 1 Figure 1. Recreational Land Developments Registered with OILSR, 1973 ......... ................ 5 Figure 2. Second Homes in the U.S., 1970 ..................................................... 6 Figure 3. Selected Site Improvements in Recreational Land Developments Registered with OILSR, 1973 ..................................................................... 7 Figure 4. Socio-Economic Comparisons.of Households Owning Second Homes with All U.S. Households, 1970 ................................................................. 8 CHAPTER 2 Figure 1. Selected State Growth Trends in Recreational Land Development ....................... 18 Figure 2. Recreational Land Developments Registered with OILSR, 1973 ......................... 19 Figure 3. Distribution of Recreational Lots Registered with OILSR, January 1974 ................. 20 Figure 4. Per Cent of Recreational Land Developments Containing Selected Site Improvements, Registered with OILSR, June 1973 ................................................. 22 Figure 5. Second Homes in the U.S., 1970 .................................................... 28 Figure 6. Distances Between Second Homes and Their Owners' Primary Homes ................... 30 CHAPTER 4 Figure 1. Annual Expenditures in Rural Communities by Seasonal Home Owners .................. 73 Figure 2. Multiplier Effect-An Initial Income of $10.00 Will Upon Successiv6 Respending Earn: (For a Leakage of 50 Per Cent) ..................................................... 74 Figure 3. Seasonal Index of Service Employment, Vermont, 1969 ................................ 75 CHAPTER 5 Figure 1. Socio-Economic Comparisons of Households Owning Second Homes with All U.S. Households, 1970 ................................................................. 83 Figure 2. Primary Residences of Second Home Owners, 1970 .................................... 86 LIST OF TABLES CHAPTER 2 Table 1. Size of Recreational Lots Reported by Respondents in ALDA Surveys, 1972 and 1973 ..... ........................................... Table 2. Average Lot Prices in Recreational Land Projects Reported by Respondents in Housing Data Bureau Survey, 1971 ......................... ..................... 21. Table 3. Availability of Utilities in Recreational Land Developments Reported by Respondents in ALDA Surveys, 1972 and 1973 .................................................. 23 Table 4. Per Cent of Recreational Land Developments With Recreational Amenities .............. 24 Table 5. Reasons for Purchase of Recreational Lots as Reported by Respondents in Northeastern California Survey, 1972 .............................................. 25 Table 6. Distribution of Second Homes in the United States by Region, 1950, 1960, and 1970 ............................................................. 29 Table 7. Reasons for Choice of Second Home Sites Reported by Respondents in Northern New England Vacation Home Survey, 1966 @ ................................ 30 Table 8@ Average Prices of Single-Family Second Homes and Resort Condominiums Built in Recreational Land Developments, 1971 ...................................... 32 Table 9. Duration of Second Home Occupancy by Region of the United States, 1966 .............. 32 Table 10. Ownership Status of Recreational Land Companies Reported by Respondents in ALDA Surveys, 1972 and 1973 .................................................. 34 Table 11. Most Profitable Forms of Recreational Property Reported by Respondents to the ULI Survey of Recreational Land Developers, 1973 ........ .............. ..... 35 Table 12. Gross Dollar Volume of Land Sales in Recreational Land Developments, Reported by Respondents in ALDA Surveys, 1972 and 1973 ........................... 35 Table 13. Number of Years Which Developers Have Been Active in Recreational Land Development .............................................................. 36 Table 14. Future Demand for Recreational Properties as Estimated by Recreational Land Developers ............................ ................................... 38 Table 15. Developers' Plans for Future Expansion in Selected Types of Recreational Land Developments .............................. .............................. 38 CHAPTER 4 Table 1, Employment and Payroll Growth of Business Units in Adams County, Wisconsin, 1967-1971 ................................ ......................... 75 CHAPTER 5 Table 1. Selected Characteristics of Recreational Lot Buyers Siskiyou County, California, 1972 ................................................................. 84 Table 2. Households Owning Second Homes by Selected Geographical Divisions, United States, 1970 ............................... lw ............................. 85 $1 6'n'e us. family in 12 owns either a second home or a vacant recreational lot. CH"TER 1. EXECUTIVE SUMMARY Recreational land development is a controversial sub. ment. Due to its problem focus, this report is often critical ject. It has caused considerable debate in the press, in the of the recreational land development industry, the Congress and state legislatures, and among local govern- products of which vary widely in quality. While there are ments and concerned citizens groups across the country,. many fine examples of high quality second home projects Attitudes toward it vary widely. Some people see it as an and resort communities scattered around the country, the opportunity to stimulate rural economies and increase impacts of shoddy recreational land development are wide- local tax revenues. Others see it as a threat to the environ- spread and serious. They are not, however, the fault of ment, fearing irreparable damage will result as woodlands developers alone. Governments, which have the duty to lakeshores, and coastlines are subdivided into recreationai regulate the use of our resources, and citizens, who help lots and second homes are constructed. shape public policies and buy the industry's products Actually, recreational land development has resulted in must also share the responsibility for the negative impacts both positive and negative consequences in different which have occurred. settings and under different conditions. On the positive At the time this study was begun in 1973, recreational side, it has provided recreational opportunities for an land development was a burgeoning business. Land was increasingly broad segment of the American public-a being subdivided and sold faster than government could place in the country to spend vacations and leisure time, a process the necessary paperwork. Since then, this place to retire, and for some an attractive financial invest- industry has been hard hit by gasoline shortages and more ment. Recreational land development has also created recently by economic recession. Both lot sales and second markets for marginally productive land, increased local home construction fell off sharply in 1974. tax revenues, stimulated local businesses, and provided This decline in recreational land development activity, some jobs. however, does not lessen the importance of the issues Despite these important benefits, recreational land addressed in this report. While subdivision platting and development has caused some very serious problems: second home construction have slowed down considerably consumer, victimization resulting from misleading and from the early 1970s, they have by no means stopped, and fradulent sales tactics; environmental degradation from consumer demands for recreational property can be the development of ecologically fragile lands; and high expected to rise again as the economy recovers. Recrea- public service costs for some rural communities. tional property isa luxury item whose future depends on This report presents a comprehensive analysis of recrea- rising disposable incomes and mobility. Based on past tional land development; the amount of land involved, the trends and recent surveys of consumer intentions, the impacts of these developments on the communities in number of households owning recreational property in the which they occur, and methods that governments can U.S. could be expected to more than double by 1985 as the adopt for controlling development and avoiding negative post World War 11 baby boom generation enters its impacts. It focuses primarily on development problems, thirties and swells the ranks of potential buyers. some of which are common to all forms of land develop- There are preliminary indications that the market for rec- ment, others which are unique to recreational develop- reational property is shifting away from the unimproved, 1 speculative lot segment of the market toward a user's range of issues posed by continued recreational land market of improved recreational lots and second homes. development in rural areas still requires the exercise of Increased consumer awareness, saturation of the specula- much greater responsibility in managing such develop- tive lot market in some areas, and increased land use ments than has occurred to date. Hopefully, this report regulation are all contributing to this trend. While some of will provide both a stimulous and a focus for increased the worst abuses of the past may be on the way out, the public action. SUMMARY CONCLUSIONS Recreational land development is occurring throughout to the changing population mix and economic base. the U.S. in response to consumer demands for speculative Changes may also occur in local political structures to the real estate investments, and for second homes (and to extent that recreational property owners become involved some extent permanent homes) for their owner's use and in community affairs. Local attitudes on the merits of enjoyment. These projects tend to be located in rural areas these social changes differ widely. But the social impact where they have a potential for creating significant en- causing the greatest controversy has been consumer vironmental, economic, and social impacts. The extent to victimization, in spite of the host of state and federal land which these impacts are beneficial or adverse depends sales laws adopted in recent years. The full disclosure largely on the care with which projects are planned and technique on which most land sales laws are based has not developed. Since the adverse effects can be quite serious, proven adequate as a means of stopping these abuses. both public officials with responsibility for project The major negative impacts of recreational land approvals and the developers themselves must take steps development can be traced to the lack or inadequacy of to ensure that project plans and implementation programs local land use and development regulations, and to a lesser are consistent with local conditions and needs, and extent state regulations. Recreational land development moreover, to the greatest extent possible, that they en- pressures have been heaviest in rural areas where land use hance the quality of the environment and the well being of controls have traditionally been the weakest. The lack of host communities. professional staff and financial resources necessary to Recreational land development has a high potential for regulate rapid increases in large scale development has causing serious environmental problems due to its also been a major problem. Emerging state laws aimed at frequent lack of or inadequacy of basic site improvements, protecting critical environmental areas such as wetlands and its tendency to locate in sensitive environmental and coastal zones can help resolve conflicts between areas. Ground and surface water pollution from improper recreational land development and sensitive environ- disposal of sewage, and erosion and siltation from runoff mental lands, but they have yet to be a major force in pose the most serious environmental problems. Other controlling development. threats to the environment include destruction of natural Most of the problems caused by recreational land areas and wildlife habitats, increased solid waste and development have been dealt with before in previously litter, and air pollution. urbanizing areas, and existing tools and techniques for The economic effects of recreational land development regulating the quality, location, quantity and timing of on local governments are likely to be positive in the initial development offer' sufficient methods of avoiding the years of project development as property taxes exceed potential negative effects of these projects. Development public service costs. Fiscal impacts can become negative standards should be set at levels appropriate for the scale over time, however, if substantial permanent occupancy and density of development, and the natural capacities of occurs in these projects (especially by families with school the site. Recreational land development should adhere to age children), or if local governments must install or make the same generally accepted development standards substantial improvements in project facilities such as required of conventional first home subdivisions of similar roads and utility systems. Effects of development on local scale and density. Basic site improvements should be economies are positive to the extent that new jobs are designed to accommodate peak occupancy, and should be created and community income increases from developer in place when they are needed by project residents, either and property owner expenditures made in the local through initial installation by the developer, or assured economy. through binding financial guarantees that they will be in- As home construction and occupancy progresses in stalled as needed. Minor variations from accepted de- recreational subdivisions, the traditional lifestyles and velopment practices in response to market preferences or cultures of rural communities begin to change in response unique environmental conditions may be appropriate if 2 they pose no threat to public health and safety and DEFINITIONS environmental quality. Prior to the recreational land boom in the 1960s, many if The burden and responsibility for setting standards and not most of the second homes in the U.S. were built on regulating these, developments rests primarily with local individual, scattered lots in traditional recreational areas governments. For some governments, review and outside platted subdivisions @ the simple hunting cabin strengthing of existing regulations is in order; for others, in the Maine woods or the lake cottage in Minnesota. which do not yet regulate development, a major effort is Public facilities seldom existed, lots were usually small, required to draft land use controls. For both, the regula- and most of the dwellings were not originally designed for tions and standards should be reviewed with a sensitivity permanent, year-round occupancy. to concerns for critical environmental areas, appropriate- For most people, the subject of second homes still ness to the scale and density of development, as well as the suggests these traditional images of scattered mountain natural carrying capacities of the site, and the degree to A-frames and lakeside cottages. This scattered lot which they stimulate better and more imaginative site development is still occurring today, but the mass market design and construction rather than only making tra- has shifted to new forms of recreational land development. ditional designs more expensive. Flexible development As commonly used today, the term "recreational land controls such as PUD ordinances, environmental per- development" refers to a range of development types formance standards, and impact assessments should be marketed ostensibly for recreational use, although they used to permit greater responsiveness to unique site are not. necessarily so used. These developments range conditions. widely in size and quality, from unimproved raw land In many local communities, regulating land use subdivisions to resort developments with condominiums, effectively will overtax available resources, and they will single-family homes, and a wide variety of recreational look to states for more help. State land use planning amenities. Other peripheral types of projects often labeled programs should identify areas suitable and unsuitable for as recreational land development include subdivisions recreational land development and channel financial and with lots sold specifically for camping or recreational technical aid to those local areas most in need of assis- vehicle use, club campgrounds under single ownership, tance. States should also increase their efforts to protect and theme park-second home complexes. critical environmental areas of greater than local concern This report distinguishes among three major types of to prevent unique natural resources from being preempted development (although some individual projects may by development. include characteristics from more than one category): The federal government should also provided needed unimproved recreational subdivisions, improved second support by taking full advantage of its existing legislative home projects, and high-amenity resort communities. mandates and enacting land use legislation as needed to Most of the recreational land development which has provide additional financial and technical assistance. occured in the U.S. falls into the first two categories, and Finally, both state and federal goverrunents should take is the primary focus of this report. steps to strengthen existing consumer protection legis- Unimproved recreational subdivisions. These projects lation by requiring financial guarantees that promised are basically land sales operations in which the developer improvements will be installed. typically subdivides the property into one-fourth or one- An estimated 10 million recreationae lots have been subdivided in the U.S, to date, many of which are in unimproved recreational subdivisions with few basic improvements or facilities such as this project in Arizona. J, 3 ? b 7 Improved second home and resort developments are similar in many respects to typical suburban developments, and frequently include recreational amenities such as swimming clubs, golf courses, or as in this project, an artificial take. half acre lots (often with little or no regard for their the scale of new towns, and development is more likely to adequacy as actual home sites), installs access roads as be carefully controlled through deed restrictions and necessary to market the property (frequently only graded architectural controls. The location of such developments dirt roads), and sells off the lots as fast as possible. Much is often governed as much by the outstanding natural of this property is sold sight unseen through the mail to amentities of the site as the location of the buyers market. buyers primarily interested in land speculation. If these projects are ever to be actually developed, the individual -STUDY METHODS AND DATA LIMITATIONS lot owners or the local community must provide the The information used in this report has come from necessary improvements such as water and sewer systems several primary and secondary sources: first, an extensive and paved roads. It is common for these projects to end up review of the literature; second, a series of personal field with little actual development, but with very confused interviews in 14 states* with government officials, patterns of property ownership as buyers default on developers, environmental groups, and concerned citizens; payments or property taxes. third, three national surveys conducted for this study (one Improved second home projects. These projects include of homeowners; one of recreational land development some basic site improvements. Recreational facilities may companies, builders, and manufacturers; and one of local also be included, and the projects are often sited in areas planning agencies in rural communities experiencing with important natural amenities such as lake or river recreational land development); and fourth, an analysis of frontage. Lot sizes are still typically one acre or less, but the registered filings of 3,900 recreational subdivisions more care tends to be taken in site design and layout. recorded with HUD's Office of Interstate Land Sales While the developer's primary objective is still to sell lots, 'Registration (OILSR). installing basic site improvements lays the groundwork Even with this data collection effort, still remarkably for a real community and buyers are more likely to be little is known about many aspects of these developments. interested in eventually building homes and using their The available data used in this report have limitations land, although speculation remains fairly common. The resulting from the widely different markets involved locations of these projects are more dependent upon good (ranging from raw lot sales to high density recreational highway access and relative proximity to metropolitan communities), the fragmentation among data sources, the areas due to the greater emphasis on a users market. lack of standardization in definitions and data collection, High-amenity resort communities. The planning and and difficulties in maintaining current information. construction in these developments are highly sophisticat- Although these limitations make it difficult to draw ed and, although far fewer in number, many are considered national generalizations in some cases, the information models of design excellence. Developers often invest collected in this report still presents the most compre- millions of dollars in basic site improvements and hensive picture of the recreational properties market and recreational amenities (swimmining pools, tennis courts, its impacts available to date. golf courses, and club houses), as well as developer-built housing, such as resort condominiums. Aimed primarily Field interviews were conducted in Arizona, California, Colorado, Florida, Georgia, Michigan, New Mexico, North Carolina, Oregon, Texas, at higher income families, some of these projects approach Vermont, Virginia, Washington, and Wisconsin. 4 MAJOR FINDINGS RECREATIONAL PROPERTIES MARKET" 3. Recreational properties are used in three major I. At least 10 million recreational lots have been sub- ways-as speculative investments, for seasonal occupan- divided in the U.S., and HUD's Office of Interstate Land cy, and for permanent occupancy. Sales Registration (OILSR) includes subdivision filings 0 Research to date indicates that between one-third from every state except North Dakota and Rhode Island. and one-half of all recreational lots are bought pri- 9 Recreational subdivisions registered,with OILSR marily as speculative investments. are most heavily concentrated in the Southeast and Where second homes are constructed on recrea- Southwest (see Figure 1). tional lots, most are occupied on a seasonal basis- Two states (Florida and Texas) contained almost typically between two and three months per year. half of the 3.5 million recreational lots registered with * There is a tendency for second homes to be con- OILSR in 1974. verted to permanent use. Although few national 9 Five more states (New Mexico, Arizona, Califor- data exist, some local surveys of second home owners nia, Colorado, and Pennsylvania) contained another report that as many as half intend to move into their quarter of these lots. second homes on a permanent basis at some point in 2. Over 3.5 million second homes had been constructed the future. In addition, recreation lots are also being in the U.S. by 1973. purchased initially for use as permanent I home sites. * The highest concentrations of second homes occur 4. Speculation in recreational lots tends to be most in the Great Lakes Region, the South, and New highly concentrated in unimproved recreational subdivi- England (see Figure 11). sions. Consumers who plan on using their property them- e In 1970, approximately one-third of the second selves tend to purchase lots in subdivisions with more im- provements and amenities. homes in the U.S. were located in Michigan, New 5. Recreational subdivision generally have fewer basic York, Texas, Wisconsin, and California. site improvements than conventional, first home sub- Few studies to date have attempted to distinguish among different types of recreational land development, therefore much of the data presented in these findings can only appear in aggregate for mi rather than being related to specific project types. FIGURE 1. 'RECREATIONAL LAND DEVELOPMENTS REGISTERED WITH OILSR, 1973. (I dot 1 subdivision) .. :Ak Note: Since the data for this figure were collected (June, 1973), project filings from Texas increased from 65 to 463, by January, 1974, giving it four-fifths as many recreational subdivisions as Florida. Source: U.S. Department of Housing and Urban Development, Office of Interstate Land Sales Registration, Unpublished material obtained from the files, June, 1973. 5 2 22-878 0 - 77 - 2 FIGUREIL SECOND HOMES IN THE U.S., 1970 (1 dot 1, 000 Second Homes) Source: U.S. Department of Commerce, Bureau of the Census, U.S. Census of Housing, 1970 Detailed Housing Characteristics. (Washington: Government Printing Office, 1972.) divisions, but are often similar in design and layout (see Heavy front-end investments are poured into mass Figure I I I). marketing and advertising schemes, rather than 0 Two-thirds of the projects surveyed at OILSR had into the basic site improvements necessary for no central sewage systems, and one-third had no housing construction and occupancy. central water systems. Many contained only dirt 9 Since both the land sales firms and the lot buyers roads. are primarily interested in maximizing returns on * The size of most recreational land developments their investments, neither has much incentive to is relatively large. Recreational subdivisions filed improve the land, and often the firm does not even with OILSR average 1,000 acres each. expect to sell all the lots. e Typical lot sizes range from one-fourth acre to one 0 These speculative subdivisions preclude alterna- acre. At full buildout, the densities of these sub- tive land uses and dictate patterns of growth for divisions are as high as metropolitan suburbs. years to come. They lock up large parcels of land by fragmenting and scattering ownership, making any 6. Owning recreational property is no longer a luxury future reassembly of the land legally difficult and limited to upper-income families. economically prohibitive. 9 One U.S. family in 12 owns a piece of recreational 8. At the other extreme, large scale second home property - either a vacant recreational lot or a second projects and resort communities tend to have an home. urbanizing effect on rural areas as homes are constructed e Todays typical second home owners are white, and public service demands increase (depending on their middle-class families whose incomes and educations scale, level of improvements, and growth rates). are only slightly higher than the national averages 0 The relative scale of recreational land development (see Figure IV). is often massive in comparison to existing rural & Three-fourths of all second home owners live in development, and can result in substantial primary metropolitan areas. and secondary population growth over time. 7. Unimproved recreational subdivisions are, in many a Most second home owners are urbanites and tend cases, resulting in extensive premature subdivision of land to demand increasingly urban levels of public ser- (i.e., homesites subdivided and sold with no foreseeable vices. demand for residential use). Many of these speculative 0 The tendency for some recreational properties to subdivisions stand little chance of ever becoming viable become permanently occupied further reinforces communities. this urbanization process. 6 ENVIRONMENTAL IMPACTS flooding and flood damage due to increased runoff 1. Most environmental impacts caused by recreational from impervious surfaces and floodplain construc- land development are no different in kind from those of tion, and aesthetic blight. other conventional subdivisions of similar size, density, and levels of improvement. Their environmental effects 2. Although unimproved recreational subdivisions can may be more serious, however, due to their lack or inade- be designed to minimize potential envirom-nental quacy of basic site improvements and their tendency to be problems, those designed to maxin-dze short run returns located on sites which are environmentally, fragile, of from lot sales are often platted as simple gridiron projects special public concern due to their unique natural features ' which show little sensitivity for the topography or other or in areas which lack the natural capacity necessary to natural features of the landscape. sustain intensive development. *Serious erosion and lake and stream siltation * Because of their tendency to locate in more sensi- have been caused in many such projects due to the tive environmental areas, recreational subdivisions grading of dirt roads on steep slopes and across result in environmental impacts which are more natural drainage courses. difficult to ameliorate. Homesites platted on excessive slopes have often 0 Recreational subdivisions are often built to lower caused erosion and siltation when developed. standards than conventional subdivisions (e.g., * Other environmental impacts in unimproved septic tanks on small lots, private wells, dirt roads, projects have been less serious to date because of etc.), resulting in more serious environmental their lower level of development activity, buildout, damage as home construction and occupancy occur. and occupancy. The potential for serious environ- 0 Two of the most common environmental impacts mental damage, however, is high where initial site caused by lower development standards are ground design is poor and projects lack basic improvements and surface water pollution from septic tanks (es- in water supply and sewage disposal systems. pecially in areas adjacent to lakes and streams), and erosion and siltation from runoff generated by dirt 3. Generalizations on environmental impacts in roads and bare construction sites. improved second home projects and resort communities are more difficult to make since they vary widely from Other environmental impacts which have resulted project to project depending on a variety of factors from recreational development include air pollution including: (especially from heavy automobile traffic in moun- tainous areas), increased solid waste and litter, the The natural characteristics of each individual destruction of fish and wildlife habitats, increased site, such as topography, soils, groundwater, wild- FIGUREIII. SELECTED SITE IMPROVEMENTS IN RECREATIONAL LAND DEVELOPMENTS REGISTERED WITH OILSR, 1973 0% 20% 40% 60% 80% 100% Sewage Disposal Facilities: Central Sewer System Existing Central Sewer System Planned Individual Septic Tanks Source of Water Supply: Publi c or Private Company Developer or Property Owner's Association Individual Lot Owner's Responsibility ii = 1,287projects These categories are not mutually exclusive; some projects contain both central sewer systems and some septic tanks. Missing data in some files account for totals of less than 100 per cent. Source: U.S. Department of Housing and Urban Development, Office of Interstate Land Sales Registration, Unpublished material obtained from the files, June, 1973. 7 FIGURE IV. SOCIO-ECONOMIC COMPARISONS OF HOUSEHOLDS OWNING SECOND HOMES WITH ALL U.S. HOUSEHOLDS, 1970. 50 yrs. 3 $10,000 X" 2 25 yrs. $5;000 X Median Annual Family Income Median Age of Household Head Median Family Size 100% $20,000 100% 50% ..... $10,000 50% Percentage Owning Value of Primary Per Cent Caucasion Primary Home Owned Home Household Heads Ell All U.S. Households Households Owning a Second Home Sources: Date for Households Owning Second Homes: U.S. Department of Commerce, Bureau of the Census, Public Use Sample of Basic Records from the 1970 Census, State Samples. Data for All U.S. Households: U.S. Department of Commerce, Bureau of the Census, Metropolitan Housing Characteristics, United States and Regions, 1970. Report No. HC (2)-1. (Washington: Government Printing Office, 1972.) Tables A-3, A-7, and A-8; and U.S. Department of Commerce, Bureau of the Census, Detailed Housing Characteristics, United States Summary, 1970. Report No. HC (1)-131. (Washington: Government Printing Office, 1972. Tables 29, 31, and 54. life, and unique natural features. acquisition programs, outbidding and preempting 0 The physical characteristics of each project in- some unique natural resource areas planned for inclu- cluding size, density, site design, and especially the sion in the public lands system. ' level of improvements (water and sewer systems, 0 Fire dangers have increased on public lands as a roads, etc.). result of adjacent population growth in recreational 0 The land development techniques and construction subdivisions. practices used by the developer. 0 Adjacent recreational subdivisions have increased 0 The adequacy of land development regulations and opportunities for unrestricted access onto public their administration and enforcement by local and lands, making environmental management difficult. state governments. 0 Other impacts on public lands have included in- 4. Considerable recreational land development has been creased litter and roadside garbage dumping, in- located adjacent to or is surrounded by publicly-owned creased traffic, increased hunting pressures, and lands (e.g., national parks and national forests), resulting overuse of some public recreational facilities. in A variety of problems. ECONOMIC IMPACTS In some parts of the country, recreational land 1. Recreational land development can stimulate local development is in competition with public land economies through increased tax revenues and developer 8 and consumer spending. Like environmental impacts, Fiscal impacts may become negative if substantial however, the net outcome varies from case to case permanent occupancy by families with school age depending on a wide range of factors, including: children occurs in recreational subdivisions. The characteristics of the local economy such as Negative fiscal impacts can also occur if develop- its size, economic diversification, and taxation ment necessitates any major, unexpected capital policies. expenditures by local govermnents, such as im- 0 The characteristics of the project including its size, proving an access road to a project, or expanding a level of improvements, extent of recreational ameni- sewage treatment plant to facilitate a new recrea- ties, and the market prices of lots and homes. tional subdivision. 0 The extent of home construction and permanent * Fiscal impacts can also become negative when occupancy which occurs in the project. recreational subdivisions (especially remote ones) are only sparcely populated, and the costs of The level of sophistication of planning and fiscal providing public services over long distances to a few management practiced by local governments. residences exceeds the total tax revenues generated by these projects. 2. Net fiscal impacts on local government are positive in the early life of most projects. The increases in tax 4. Communities have tried to reduce negative fiscal revenues generated by development usually exceed the impacts by various methods. increased costs of providing public services during the & Standard facilities requirements (commonly used initial years, for several reasons. with conventional subdivisions) for roads, water 0 Most recreational subdivisions have few homes supply, and sewage disposal systems have usually built in them to date, and therefore have yet to make been successful in reducing subsequent public invest- major public service demands on local governments. ments for such facilities. 0 While second homes are taxed at the same rates 0 Some communities have encouraged privately as first homes, the large majority of second homes owned and maintained facilities (usually by property are still seasonally occupied, and therefore place owners associations) rather than accepting public few burdens on local public school systems, which responsibility for future maintenance and operation. generally consume as,much as half or more of local This approach can lead to problems, however, if tax revenues. property owners associations collapse and local *Because some local governments either ignore government has to step in. many of the service demands of second home owners, 0 A few communities have tried to avoid certain or do not have the capacity to provide them, many public service costs by restricting permanent occu- recreational subdivisions go without the services pancy, but experience to date indicates that this which would normally be expected in suburban approach is administratively impractical and difficult developments of similar size and density. to enforce. 3. Over time, negative fiscal impacts can result from 5. The impacts of recreational land development on the recreational land development if public service demands or private economic sector can be both positive and negative. major capital expenditures necessitated by these projects 0 A major benefit is the increase in community outstrip the tax revenues they generate. income which occurs to the extent that expenditures Second home construction can be an important source of employment for local contractors and builders. VL look I'M made by developers and property owners are made a vacation suburb for middle-income families from in the local economy. Studies have shown that the cities. between one-third and three-fourths of total develop- ment and user expenditures may accrue to the local 2. Other social impacts which have concerned local area, depending primarily on the levels of project residents are increased crowding and traffic, increased improvements and amenities, the extent of home crime, and restricted access to public recreational construction and occupancy, and the availability of facilities. goods and services in the local community. Unim- 3. Recreational property owners may become important proved subdivisions generate relatively little com- political forces in rural communities, depending largely munity income compared to improved second home upon their occupancy patterns. projects and resort communities since development *Farnilies using their second homes seasonally activity, home construction, and occupancy are seldom become involved in local community affairs. minimal. Second home developments have been called "com- 0 New job opportunities may also be created, either munities of limited liability" where residents come directly in the construction and operation of projects, to rest and relax, taking little interest in local rural or indirectly in local businesses serving projects and problems which do not directly affect them. their residents. At the same time, some old jobs, 0 When recreational land development results in usually agriculturally related, may be displaced. permanent population growth, the political effects 0 In some communities, the creation of new jobs can be substantial in sparcely populated rural areas. from recreational land development has attracted The tendency for these newcomers to take an active job seekers from outside the local area, creating com- part in local affairs is accentuated by the fact that petition for the new jobs which are available, and also they generally have higher educations, higher in- generating secondary population growth for which comes, and more free time. public services must be provided by local govern- ment. 4. Many second homeowners share a common attitude 0 Recreational land development has created referred to by some as the "gangplank syndrome." Having markets for the sale of marginal farm, grazing, 'and moved to an area to enjoy its natural beauty and rural timber lands in many parts of the country. On the atmosphere, they are anxious to keep it that way, and other hand (although not well documented), develop- close the door on further growth. In rural communities ment has caused upward pressures on land values, adverse to more recreational development, these housing costs, and tax assessments pricing some individuals have often been instrumental in shaping local native rural families out of farming and local housing growth policies. In other cases, especially where local markets. residents still wish to capitalize on land development, this 11 we've got ours" attitude to some second home owners is SOCIAL IMPACTS deeply resented. 1. As home construction and occupancy in recreational 5. Consumer victimization in recreational land sales has subdivisions occurs, traditional rural cultures and life- been a serious national issue for over 10 years, and it styles change. Service oriented tourist economies begin remains an important social issue today. Thousands of to replace agricultural economies as subdivisions and consumers have been the victims of high-pressure sales second homes replace farms and woodlands. These social tactics, deceptive and fraudulent advertising practices, changes are accentuated by the fact that the newcomers and broken promises. are generally urbanites with attitudes and lifestyles which 0 Consumer victimization has been far more wide- are in marked contrast to those found in most rural com- spread and serious in the unimproved lot sales munities. Local attitudes toward these social changes vary business than in other sectors of this industry. widely. 0 During 1973 at the peak of the recreational land 0 Some local residents view recreational land de- development boom, OILSR received 1,500 letters velopment and its resulting population growth as a per month from consumers, over half of which were cultural as well as an economic asset. They welcome complaints against land sales firms. Most consumers the stimulus of change-the influx of new people complained about the failure of developers to deliver with lifestyles and attitudes different from their own. on promised improvments, deceptive sales practices, and the poor investment potential of the property. Others regret the gradual erosion of traditional 0 Many recreational lot buyers have been dissatis- rural culture, but accept it as the inevitable price of fied with their purchases. Some surveys have report- economic growth. ed that as many as half of the responding lot buyers 0 Still others consider recreational land development were disappointed. a form of exploitation and colonization by a wealthier 0 The investment potential of many unimproved urban class. In some parts of the country where recreational lots has been poor, partly due to the fact second home development has been extensive, local that the original lot prices were so inflated with sales residents strongly resent the countryside becoming and promotion costs. Resale experiences have been 10 dismal for many consumers, and some have failed ment standards to recreational subdivisions and second even to recoup their original investments. homes as they have to permanent home developments, although some communities have granted variances from REGULATION OF DEVELOPMENT improvement standards for streets, curbs and gutter, storm drainage systems, sidewalks, and street lighting. 1. The major responsibility for controlling the location Standards affecting public health more directly (e.g., and substantive quality of recreational land development water suply and sewage disposal requirements) have not rests with local governments, but on the whole, they have been as frequently modified, although enforcement not been effective in exercising this responsibility. practices vary widely. e Recreational land development pressures have 4. Many recreational lots and second homes existed been the greatest in rural areas where local land use before local regulations were adopted and do not meet controls have historically been the weakest. current development and construction standards. Govern- s Many local governments had, no zoning or sub- ment's response to the development and use of these division regulations at all when the recreational land properties has varied. development boom hit in the mid-1960s. Conse- a In most cases, home construction on substandard quently, hundreds of recreational subdivisions have recreational lots has been permitted without ad- been platted and sold across the country without being subject to any public development standards herence to current standards. or review. 9 In other cases, compromises have been made, 9 Most local land use controls in rural communities usually for side-yard and setback requirements. were never designed to regulate large scale develop- Health codes regulating water supply and sewage ment, and are inadequate to do the job. disposal systems have been compromised less often, making many small recreational lots essentially un- *Administration and enforcement of land use buildable. controls in remote rural areas are often weak. Pro- * Few rural communities have any regulations fessional staff are scarce and budgets are small. requiring second homes to meet current code require- * Many local communities failed to anticipate the ments when they are converted to permanent use. scale or density of encroaching recreational land development until too late to respond effectively to 5. State governments have strengthened their role in it. Others have resisted land use controls until de- land use controls in recent years, affecting recreational velopment impacts have reached crisis proportions land development in two ways. forcing them into action. 2. Recreational land development is not a phenomenon A few states have passed laws requiring local requiring a totally new regulatory approach. Traditional governments to adopt land use and development land use control techniques commonly used in urbanized regulations, often with provisions for state interven- areas have been successful in preventing the major nega- tion if local governments fail to act (e.g., California tive environmental and economic impacts of recreational and Oregon). Also, some states, such as Vermont, Maine, and Florida have set up their own review and land development, although they will not necessarily approval procedures for certain developments, induce high quality developments designed with sensi- which have included recreational land developments. tivity to their environment. Both of these approaches have helped to close the e The major negative impacts of recreational land gaps in local regulations which have allowed develop- development on local communities have resulted ment to go unchecked in many parts of the country. primarily from the total lack or inadequacy of local o Emerging state laws aimed at protecting wetlands, land development regulations, as well as poor ad- coastal zones, shorelines, mountains, scenic rivers, ministration. floodplains, and other critical environmental areas * in communities which have regulated develop- are helping to protect environmentally sensitive ment, conventional techniques such as zoning, lands which are often under heavy development ordinances, subdivision regulations, facilities re- pressure from recreational subdivisions and second quirements, and building and health codes have homes. Such legislation reduces the area in which proven adequate tools for preventing most negative recreational land development can operate without environmental and economic impacts. public scrutiny, and helps to protect remaining 9 Local development regulations have not, however, natural areas which recreational subdivisions could been effective in' resolving conflicts over location preempt or despoil. between recreational land development and critical 6. This emerging body of state land use and critical area environmental areas of greater than local concern. legislation has set important precedents and resulted in Protecting natural resources such as coastal wet- better recreational land development in some areas. But lands from development impacts has generally re- state programs vary considerably. Many contain adminis- quired state or federal initiatives. trative loopholes, minimal standards, and weak enforce- 3. Most communities have applied the same develop- ment provisions. In short, the expanded state role in land use controls is still too new to offer any national panacea ports presented by developers. Many consumers do for inadequacies at the local level. The bulk of the respon- not bother to read this information, and many of sibility for regulating the quality of recreational land those who do cannot understand it. development still rests in the hands of local government. * The marketing and advertising practices of land 7. Over 40 states have some form of consumer pro- sales firms are extremely persuasive and difficult tection legislation regulating land sales. Their quality to regulate and police. This is especially true of varies widely from state to state, and only a few (e.g., the verbal claims made by salesmen. California, New York, and Michigan) are considered tough 9 Existing land sales laws have created an illusion enough to offer consumers any significant protection. In of widespread consumer protection, when in fact, many states these laws often hinder good recreational land consumer victimization continues to be a problem. developers, add to the cost of land and housing, and yet Some consumers still think a property report is a allow many unscrupulous firms to continue operating. federal certification of a project. 8. The federal response to recreational land develop- * Federal (and state) agencies administering land ment has been essentially restricted to the field of sales laws have not had the staff and budget re- consumer protection through disclosure, primarily sources necessary to get the job done. through the Interstate Land Sales Full Disclosure Act 9. Beyond consumer protection, the federal govern- administered by HUD. ment's effect on recreational land development has been * Federal (and state) land sales laws have been un- limited and indirect. Some federal laws such as the able to wipe out consumer victimization. They have National Environmental Policy Act, the Coastal Zone relied almost exclusively on the full disclosure Management Act, and the Water Pollution Control Act technique, which has no direct effect on the quality could have important influences on development in the of the product itself, and puts the burden on con- future, depending on how they are further interpreted, sumers to read and evaluate detailed property re- administered, and enforced. RECOMMENDATIONS The issues raised by recreational land development are The location of new recreational land development must as broad and varied as the subject of urbanization itself. also be carefully evaluated to prevent the lossof unique Most of these issues have already been dealt with in environmental areas which should be preserved in their urbanized areas, and their solutions may usually be found natural state. To avoid environmental damage, sites must in the application of existing methods and techniques for be chosen which have the natural capacity to support regulating the quality, location, quantity and timing of development at the intensity proposed. Present and future land development. Controlling these variables will public service delivery costs are also a function of site encourage good recreational land development of lasting locations. And choosing appropriate development sites value, while helping communities avoid the negative can further protect consumers from such things as impacts which many have already experienced. flooding and other natural hazards, as well as assuring The key ingredients of development quality are the them of buildable homesites. adequacy of basic site improvements such as water and Regulating the quantity and timing of development sewer systems, roads and drainage systems, site design, provides a further means of avoiding negative impacts. and construction standards. Adequate project facilities The scale of development (measured in dwelling units or lessen the extent of environmental impacts as well as the projected population) should be sensitive to the resource potential for negative fiscal impacts on local governments. capabilities of the land to avoid overloading natural Construction of adequate project facilities also provides a systems such as the groundwater supply, and the timing greater stimulous to the local economy. Adequate of large projects should be in phase with local govern- development standards will drastically reduce premature ment's ability to provide public services and capital recreational subdivisions. Controlling development improvements. quality is also the surest form of consumer protection. The following recommendations focus on the major roles Simply informing consumers of product deficiencies has and responsibilities of different levels of government in proven inadequate as a means of protection. Only through regulating recreational land development. For some juris- assurances that the products themselves are fit will con- dications, new development pressures may only require sumers be truely protected. modification of existing regulations, but for many others 12 where few or inadequate development controls are in essence this means that recreational subdivisions and effect, major efforts will be necessary including the hiring second homes should adhere to the same generally of professional staff to plan for growth and administer the accepted development standards required for conventional necessary controls. Some of the costs of regulating first home subdivisions of similar scale and density. recreational land development will be passed on to recrea- tional property.buyers themselves. Others will inevitably Septic tanks should not be considered acceptable be shared bythe general public. These costs of managing as a permanent means of sewage disposal in high growth, however, should far outweigh the negative con- density subdivisions. Where central sewer systems sequences of uncontrolled recreational land development. are not feasibile, density limits should be set low enough to guarantee that septic tanks pose no LOCAL GOVERNMENTS threat to ground or surface water quality. (Actual In most states, local governments still have the bulk of density standards will vary from place to place de- the authority for regulating land use, but many of them pending on soil suitability, ground water conditions, have not fully exercised their responsibility to do so. etc.) 9 Where septic tanks are permitted, evidence of 1. Local governments in rural areas which do not yet adequate site capability (lot size/soil conditions) regulate land development should move quickly to draft should be provided on a lot-by-lot basis to prevent land development regulations, accepting the experiences the platting of any unbuildable lots. of others without waiting for a local crisis to occur. e Separation requirements between private wells and 0 They should establish on-going planning processes septic tanks should not be compromised. Rural to guide the orderly growth of their communities, health codes should be reviewed for their adequacy designating areas most suitable for recreational sub- to deal with large scale, high density subdivisions. divisions and areas worthy of preservation due to Health code enforcment (which is extremely lax in their natural, scientific, historical, or archaeological some rural areas) should be stepped up with routine significance. inspections of development sites. * The land use controls adopted should reflect the 0 Project facilities (e.g., water supply and sewage best emerging techniques from urban and suburban disposal systems) should be designed to accom- development experience including planned unit inodate peak loads at full occupancy. Even though development and site plan review procedures, en- most second homes are only occupied on a seasonal vironmental and fiscal impact analysis, and environ- basis, projects can be fully occupied during peak mental performance controls. recreational seasons, and facilities must have the 0 Sensitive environmental areas such as hillsides, capacity to service them during these periods of peak wetlands, and shorelines should be governed by demand. regulations designed to minimize environmental 0 Variances, if granted, from conventional design impacts during and after construction. These regula- standards (for such improvements as roads and tions should prescribe performance standards and drainage systems) should be based solely on sound preventive techniques governing such things as engineering design and environmental performance erosion and runoff control, removal of vegetation, criteria depending on the density and scale of the density reductions on excessive slopes, and buffer project and the natural characteristics of the site. zones and setback requirements for lakes, strearns,, Development standards should not be reduced on the and other water bodies. grounds that project facilities will be privately owned and maintained by the developer or a property Cluster techniques should be encouraged or re- owners association. quired in sensitive environmental areas permitting 'Substantial portions of development sites to be left *Variances from other conventional subdivision in undisturbed, natural open space. improvement requirements (e.g., street lighting, *Development proposals should be carefully re- sidewalks, curbs and gutters) may be appropriate viewed to ensure that projects do not block or inhibit at low densities to reduce development costs and access to public recreational areas and public lands. maintain rural character. Decisions on such vari- ances, however, should also be based on performance 2. Where development regulations already exist, tiley criteria and the needs of project residents, and may should be carefully reviewed to determine their adequacy be equally appropriate for first home developments to deal with large scale recreational projects. Obsolete under similar conditions. ordinances should be amended or redrafted. Loopholes which permit subdivisions to be created without being 4. Local governments should take steps to ensure that officially reviewed and approved (such as through suc- basic site improvements are in place when they are needed cessive lot splitting) should be closed. by the residents. 3. Standards for recreational land development should Governments should plan for and approve recrea- be appropriate for,the scale and density of that develop- tional land development on the assumption that full ment, and the natural carrying capacities of the site. In buildout and permanent occupancy may occur over 13 x 21 k_ Local land development regulations should include controls designed to minimize environmental damage due to erosion and runoff from bare construction sites, especially on steep terrain. time, rather than permitting the subdivision of unim- they have the existing or planned capacity to provide proved land on the assumption that no one will ever the necessary public services. live in these projects. 0 Experience has shown that the safest procedure to 5. Steps should also be taken to reduce environmental ensure the installation of facilities when needed is to problems in existing recreational subdivisions. require initial installation by the developer. Where 0 Governments should take immediate steps in buildout is predicted to occur over many years, pro- vacant or partially developed subdivisions to control jects should be developed in phases. Using building erosion and runoff from substandard road beds and and occupancy permits, local officials should restrict cleared construction sites. home construction to development phases in which * In communities where substandard recreational adequate facilities are being installed. lots predate local subdivision regulations, the In lieu of initial installation, local governments issuance of building permits should be contingent should require developers to provide adequate finan- upon full compliance with current water supply and cial guarantees that the facilities will, in fact, be sewage disposal requirements. Unfortunately, such a installed as needed, using such devices as perfor- policy will leave some recreational lot owners with mance bonds or escrow accounts. If facilities are not unbuildable homesites unless central water and installed initially or guaranteed by the developer, sewage systems are installed. local governments may ultimately have to accept 0 In communities where a substantial number of responsibility for providing these improvements. vacant recreational subdivisions already exist, While this responsibility can legally be placed on further development plans should be closely individual property owners or their associations monitored to alert local officials to the need for public through clauses in deeds, such clauses may be im- facilities and services well before the actual need practical or even impossible to enforce when the arises. facilities are actually needed. 0 Monitoring programs should be set up to routinely 0 No subdivision plat should'be approved, building check the performance of septic tanks in existing permit issued, or lot sold until after the existence of projects. a water supply adequate to support full buildout and 6. Local governments should take steps to ensure that permanent occupancy has been certified. The ade- recreational land development is an economic asset rather quacy of proposed sewage disposal methods should than a liability to their communities. also be certified before any subdivision plat is approved. a Local governments should study the fiscal conse- 0 Wherever possible, local governments should quences of proposed projects, using this information guide the location of development into areas where to negotiate project plans with developers (e.g., 14 dwelling unit mix, bedrooms and floor areas per some prodding. Many local governments do not have dwelling unit, etc.). Fiscal information can also be adequate staff to plan for and regulate large scale land used to plan for future capital improvements to meet development, nor the financial resources necessary to hire public service demands as they arise. Where develop- these skills. There is also strong political resistance to land ment pressures overtax the capacity of local govern- use planning and controls in many rural areas. ment to undertake the necessary studies, application Second, state governments should initiate controls over fees should be used to cover the costs of obtaining critical environmental areas of greater than local concern. outside technical assistance. Because many of these areas span more than one local Development regulations should require project jurisdiction, and because regional and state interests in the use of these lands may conflict with local interests, facilities to meet all current standards for public local regulations alone are not adequate to protect many dedication when initially constructed or else require critical areas. that they be brought up to public standards at the property owner's expense before dedication is 1. State governments should enact legislation man- accepted. dating local governments to adopt the necessary or- * Project approvals can incorporate conditions dinances to plan for and regulate land use within their which ensure that whenever major associated public jurisdictions. improvements are required by development (such as improving an access road to a remote subdivision), Local land use regulations should be required to the developer will be assessed fees covering these meet minimum statewide standards for project costs to the extent that such improvements are design and review procedures. State agencies should directly necessitated by the project. be designated to intervene in the review and approval process where local governments fail to act within Local officials should encourage developers to specified time periods. establish spending and hiring policies in favor of the local economy to the extent feasible. 9 Adequate technical and financial assistance should STATE GOVERNMENTS be made available by states to local governments which do not have the necessary resources to plan State governments have two important roles to play in and regulate development on their own. regulating recreational land development. First, they should assist in the strengthening of planning and land Where regional planning agencies and Local De- use controls at the local level, and see that gaps in local velopment Districts (in the Appalachian States) regulations are, in fact, closed. It is unrealistic to expect exist, states should take full advantage of these all rural governments to develop adequate regulatory existing staff resources in providing technical plan- systems without outside assistance, and in some cases ning assistance to local governments. Development regulations which do not require that adequate utility and road improvements to be installed or guaranteed in recreational subdivisions can result in future economic problems for local governments and property owners. 7, ru A- 3111'@V7LX, 15 2. In addition to strengthening local planning and land disclose the success records of any resale programs use controls, state governments should enact stronger which they operate. legislation protecting critical environmental areas including wetlands, shorelines, coastlines, mountains, and FEDERAL GOVERNMENT other environmentally fragile lands. The federal government has several important roles to play in encouraging high quality recreational land Statewide land use plans should identify areas development, including providing financial incentives and suitable and unsuitable for recreational land develop- assistance for state and local land use planning and critical ment, including criteria for guiding the location of area protection, and strengthening consumer protection development. These guidelines should be designed to measures. avoid conflicts between development and prime 1. The federal government should provide a major agricultural lands, critical environmental areas, and impetus in strenthening state and local planning and lands needed for the expansion of public recreational development controls. facilities such as state parks. 0 The federal government should take full advantage Priorities for designating critical environmental of its existing legislative mandates (e.g., HUD 701 areas should take into account existing or potential programs, Section 208 planning requirements, development pressures to ensure that critical areas coastal zone management, etc.) to encourage ade- are not preempted by subdivisions. quate land management through existing federal * Environmental impact statement procedures funding programs to state and local agencies. should be applied to private developments in critical 0 Congress should enact additional legislation as environmental areas. needed to. provide financial aid to state and local o States should set up ongoing data systems which governments for land use planning and management. monitor trends in both rural land subdivision activity 2. Steps should be taken by the federal government to and second home construction. reduce the negative impacts and management conflicts 3. Existing state policies and programs for acquiring between public ' lands and recreational development on public lands such as parks, recreational areas, and wildlife adjacent private lands. refuges should be reviewed in light of shifting recreational 0 Any future federal land use legislation should land development pressures. include provisions requiring the coordination of land adjusted use pl.ans and de.velopment controls between federal Priorities for such programs should be agencies managing public lands (e.g., the U.S. and implementation -speeded up as necessary to pre- Forest Service, the National Park Service) and vent the preemption of areas which, due to their state and local units of government with authority location and natural features, would better serve the over adjacent private lands. recreation needs of the general public. The recent Federal agencies managing public lands should be economic slowdown in the recreational properties market offers some excellent opportunities to acquire more discriminating in their granting of special use natural areas for preservation and public use at re- permits and land trades with private developers, duced costs. considering the full range of potential impacts of o The accessibility to existing public recreational private development on public lands. areas such as lakeshores and coastlines should be 3. Federal policies and programs for open space pro- reviewed and the necessary steps taken (e.g., acquis- tection and public acquisition should be reviewed and ition, easement) to guarantee that public access into adjusted in light of existing and potential land develop- these areas is not restricted or hindered by private ment pressures to avoid the preemption of lands needed to development. meet the recreational needs of the general public in the years to come. 4. State governments should strengthen existing land 4. The federal government should take further steps to sales legislation in order to improve consumer protection. strengthen existing consumer protection legislation in land sales. State land sales laws should be amended where e Regulations enforced by HUD's Office of Interstate necessary to prohbit the advertising or sale of any Land Sales Registration under the Interstate Land lot or dwelling unit until financial guarantees (e.g., Sales Full Disclosure Act should be amended to include performance bonds, escrow funds) are in force en- the provisions recommended above for strengthing state suring that promised improvements and facilities will land sales laws. be constructed. 0 Cooling off periods in which consumers may re- In addition to the further tightening of advertising consider sales terms should be extended to 14 days. regulations administered by OILSR, the Federal Trade Commission should more aggressively exercise its full *Developers should be required to substantiate authority to prosecute unscrupulous land sales firms claims of resale land values or be restricted from which persist in making false and misleading ad- making them. Developers should also be required to vertising claims. 16 CHAPTER 2 A NATIONAL OVERVIEW OF RECREATIONAL LAND DEVELOPMENT The private ownership of land and housing sort communities) . However, since no previous at- purely for recreational use had long been a luxury tempt has been made to classify recreational land restricted to the wealthy until during the 1950s and development by project types, much of this discus- increasingly in the 1960s when a number of factors sion must focus on the industry as a whole. came into play which brought the ownership of rec- reational property within reach of a massive middle National Stock of Recreational Lots income market. Increasingly higher levels of dis- posable income, increasing amounts of vacation and The best available data indicate that there are leisure time, improved mobility through better high- at least 10 million subdivided recreational lots in ways (especially the Interstate Highway System) and the U.S. todayand possibly many more. This figure widespread automobile ownership, nationwide adver- is based on several estimates. For example, since tising campaigns, and high-pressure sales techni- its formation in 1969, developers have registered 3,900 recreational subdivisions with HUD's Office ques all were major factors in creating an unprece- dented recreational land development boom during of Interstate Land Sales Registration (OILSR), ac- the late 1960s and extending through 1973 when hard counting for 3,375,821 recr eational lots covering hit by economic recession.(The country experienced 7,146,229 acres of land as of January, 1974.1 Lots a similar but smaller land sales boom during the registered with OILSR account for only a fraction 1920s in Florida and to a lesser extent in Califor- of the total recreational lots in the country since nia .) a substantial amount of subdivision activity oc- Prior to the 1960s, most recreational property curred prior to 1969. OIL .SR officials estimate that occurred as individually scattered lots and second only about 40 per cent of the currIent recreational homes, but today's recreational land development is subdivisions subject to the Interstate Land Sales almost synonymous with large-scale subdivisions sim- Full Disclosure Act have been registered.2 Compar- ilar in design to most conventional suburban subdi- isons of OILSR data with a recent study in Utah show that OILSR filings represent only 14 per cent visions, although typically with fewer improvements and facilities. In spite of its "recreational" la- of the projects and 24 per cent of the recreational bel, much of this property has been marketed to con- lots in that state.3 sumers interestedin speculative investments rather According to estimates derived from a sample than vacation or permanent homesites. survey of 7,190 U.S. households conducted for this study, some 2.3 million families own a recreational This chapter presents a quantitative overview lot.4 If lots sold account for only one-third to of recreational land development in the U.S.--the extent of development, its location,rate of growth, one-half of all the lots subdivided, as some indus- try surveys indicate, the total number subdivided physical characteristics, and how this property is being used. It also includes a brief discussion of would amount to between 4.5 and 7 million lots.5 the industry itself, and the factors which caused Another estimate can be derived from industry the growth of the recreational properties market data. A 1973 survey conducted by the American Land and will shape its future. The chapter is divided Development Association (ALDA) reported that the into two sections,one focusing on the land (recre- responding recreational land development companies ational lots); the other focusing on the housing had subdivided an average of over 2,400 lots each.6 (second homes). Wherever possible the data pre- ALDA estimates that there were approximately 10,000 sented here are related to the three project types recreational land sales and development firms in the defined in Chapter 1 (unimproved recreational sub- country in 1973.7 If each had subdivided 2,000 lots, divisions, improved second home projects, and re- the total national stock of recreational lots would 17 Figure 1. Selected State Growth Trends in Recreational Land Development 6 4. 5-- 0 3- r 0 4- 4 J @4 2- 4J C; ;3 2- Q Lq 4J 0 to a) @4 U 1962 1972 1969 1973 UTAH CALIFORNIA 25. 1500- a) @4 20- 0 M En 44 0 0 a) 1GOD. 15- U) 4J @4 10. 4J 500- r U) -P 0 5- @4 W 19".1 . . . . . . . . ;97T 19'67 '19i3 WASHINGTON FLORIDA Sources: Utah-Cumulative totals of lots in recreational subdivisions since 1962, as determined by the Utah Real Estate Division. Workman, John P., Donald W. MacPherson, Darwin B. Niel- sen, James J. Kennedy, A Taxpayer's Problem-Recreational Subdivisions in Utah. (Logan: Utah State University Press, 1973). California-Cumulative totals of acres in "land projects" registered with the California De- partment of Real Estate since the fiscal year 1968-69. California law defines "land projects" as subdivisions of 50 or more parcels in lightly populated areas (less than 1,500 registered voters within two miles of the project). Obtained through correspondence with Raymond M. Dabler, Assistant Commissioner, State of California Department of Real Estate. Washington-Interagency Committee for Outdoor Recreation, Second Homes in Washington, Summary Report. (Pullman: Cooperative Extension Service, College of Agriculture, Washington State University, 1971). Florida-Cumulative totals of lots in unimproved and improved subdivisions registered with the Division of Florida Land Sales since 1967. Florida law defines "unimproved acreage" as land with no improvement whatsoever, including land which may be under water and inaccessible except by plane or boat.. "Improved Acreage" refers to land which has roads traversable by conventional automobile, and drainage. Obtained through correspondence with William E. Sanborn, Investigator, State of Florida Department of Business Regulation, Division of Florida s Land Sale 18 Figure 2. Recreational Land Developments Registered with OILSR, 1973 (1 dot 1 subdivision) _G' Source: U.S. Department of Housing and Urban Development, Office of Interstate Land Sales Registration, Unpublished material obtained from the files, June, 1973. Note: Since the data for this figure were collected (June, 1973), project filings from Texas increased from 65 to 463, by January, 1974, giving it four-fifths as many recreational subdivisions as Florida. exceed 20 million. This estimate is probably much in recreational lots over time. (These data do not too high since respondents to the ALDA survey did reflect the recent slump in the recreational land not represent many of the very smallest firms in the market.) industry. Finally, as early as 1966 there were over 14 National Distribution of Recreational Lots million vacant, single family lots in the U.S. ac- The distribution of recreational subdivisions cording to the 1967 Census of Governments.8 Al- is highly concentrated in several states as shown though the Census did not distinguish between recre- in Figure 2. Ten states contained nearly two-thirds ational lots and primary home lots, it did report (65 per cent) of all recreational subdivisions filed that half the vacant lots were outside of Standard with OILSR as of January, 1974 (Florida, Texas, Ari- Metropolitan Statistical Areas. zona, California, Colorado, Missouri, Pennsylvania, The extent of recreational land development North Carolina, Virginia, and Michigan). only North seems proportionately much greater when viewed from Dakota and Rhode Island had no recreational subdi- a local rather than a national perspective. In many visions registered with OILSR.15 counties and even some states, there have already The distribution of recreational lots is more been enough recreational lots subdivided to accommo- highly concentrated than subdivisions, since recre- date more than double the existing permanent popu- ational subdivisions in the South and Southwest tend lation. For example, in 1971 Nevada County, Cali- to be larger than those in other parts of the coun- fornia, had enough recreational lots to house three try. Florida and Texas contain only one-fourth (26 times its existing population. 9 While the popula@ per cent) of all recreational subdivisions filed tion of Box Elder County, Utah declined by 940 be- with OILSR, but contain nearly half (48 per cent)of tween 1962 and 1972, more than 58,000 acres of land all recreational lots filed. Seven states (Florida, in the county were subdivided into recreational lots Texas, New Mexico, Arizona, California, Colorado, during the same period.10 In 1972, Summit County, and Pennsylvania) contain three-fourths (75.3 per Colorado, with a population of 3,743, had almost centY of all recreational lots filed with OILSR (as twice as many recreational lots as existing resi- shown in Figure 3), accounting for 82.3 per cent of dents.11 And a recent study from Arizona reports that there were enough vacant.lots in remote sub- Figure 3: Distribution of Recreational Lots divisions in the unincorporated areas of that state Registered with OILSR, January, 1974 to accommodate more than double its 1974 popula7 tion.12 Number of Recreational Lots Subdivided Annually Texas 21% Recr&ational land development activity was :0- heaviest during the late 1960s and early 1970s. 0 Data on lot sales trends are not available on.a na- p tional basis, however, it appears that development Florida 27% activity grew steadily during this period. In an- Arizona 7.7% nual membership surveys conducted by the National CQjj Association of Real Estate Boards, an average of 83.5 per cent of the respondents stated that the volume of transfers of recreational land were the Remainder of U.S. 0 24.7% same or higher every year between 1963 and 1972. 13 In 1971, the year which some observers consider near the peak of the recreational land boom, ALDA estimated that some 650,000 recreational lots were Source: U.S. Department of Housing and Urban De- sold. 14 Figure 1 presents four selected state ex- velopmentj Office of Interstate Land-Sales amples of recent trends showing cumulative growth Registration, Unpublished material obtained from the files, January, 1974. 20 Table 1. Size of Recreational Lots Reported by Table 2. Average Lot Prices in Recreational Land Respondents in ALDA Surveys, 1972 and 1973 Projects Reported by Respondents in Housing Data Bureau Survey, 1971 Per Cent of Lots Size of Lots Average Price Per Cent of Respondents 1972 1973 Less than $2,000 4.0 Less than 1/4 acre 16.5 26.0 $2,000 to $3,999 12.0 1/4 to .9 acre 50.5 42.0 $4,000 to $5,999 24.0 1 acre to 4.9 acres 22.2 19.0 $6,000 to $7,999 27.0 5 acres or more 7.5 6.0 $8,000 to $9,999 13.0 Undivided interests 3.3 7.0 $10,000 to $13,999 12.0 100.0 100.0 $14,000 or more 8.0 n 1,073,554 n 798,188 100.0 I n = 1@0 Source: American Land Development Association, The Land Industry Survey, 1972, and The Land Industry Survey, 1973 (Washington: American Source: Housing Data Bureau, Inc. Recreation Land Development Association, 1972, 1973), Land and Leisure Housing Report, Vol. 3, No. 8 n.p. (May 8, 1972). all the acreage in recreational subdivisions on Lot Prices. Recreational lot prices vary de- file. (Appendix A presents the number of recrea- pending on their location, the level of physical im- tional lots, subdivisions, and acres filed with provements in the project, and the quality and type OILSR for each of the 50 states.) of recreational amenities available. Lake and sea- side lots are in the greatest demand and command Characteristics of Recreational Land Developments some of the highest prices. Lots with good views Lot and Project Sizes. Today's recreational and lots in highly developed resort communities also lots rang( ;p in size from less than one-fourth acre sell for a premium. The ALDA survey reported aver- to five acres or more. Typical lot sizes are one age selling prices for recreational lots in 1972 at acre or less as shown by the ALDA survey data in $6,548, ranging from a low of $300 to a high of Table 1. A survey of Urban Land Institute (ULI) $125,000.21 A 1971 survey conducted by the Housing members developing recreational property found that Data Bureau, Inc. found half the lots priced between over half (56.8 per cent) of the lots were less $4,000 and $8,000 as shown in Table 2. than one acre; 16 per cent were less than one-fourth Basic Site Improvements. Site improvements acre; and 17.6 per cent were over five acres.16 A such as water and sewer systems, and roads, vary 1967 survey of second homes in northern New England from project to project dependiftg on local land use also reported that over half the lots surveyed were regulations and the developer's own marketing,ob- less than one acre.17 jectives. While most recreational subdivisions are Recreational subdivisions vary widely in total designed at typical suburban densities, the major- size from as few as 20 acres to more than 10,000 ity do not have suburban levels of improvements. acres. Two-thirds of the projects reported in the Data collected on 1,287 recreational projects reg- ALDA survey were less than 1,000 acres in size while istered with OILSR reveal the general status of 27 per cent were between 1,000 and 51.000 acres. Cne- site improvements as shown in Figure 4. fourth of the projects (26 per cent) were less than Individual septic tanks are the predominate 100 acres.18 In the ULI survey, almost half (46.2 means of sewage disposal in recreational subdivi@ per,centY of the projects were 1,000acres or larger. sions. Over two-thirds (69.8 per cent) of the sub- The mean project size was 1,970.8 acres, and half divisions surveyed used septic tanks as the only the projects contained 1,000 lots or more.19 The means of sewage disposal, while less than 10 per mean size of the 3,900 projects filed with OILSR cent had sewer systems. (Another 8.5 per cent re- was 1,832 acres, and they contained an average of ported plans to install sewer systems in the fu- 865 lots each.20 ture.) Projects in New England reported septic 21 222-878 0 -77 Figure 4. Per Cent of Recreational Land Developments Containing Selected Site Improvements, Registered with OILSR, June, 1973 Per Cent Sewage Disposal Facilities* 0 20 40 60 80 100 Central Sewer System Existing _T Central Sewer System Planned Individual Septic Tanks Source of Water Supply: Public or Private Company Developer or Property Owner's Association Individual Lot Owner's Responsibility n = 1,287 projects *These categories are not mutually exclusive; some projects contain both central sewer systems and some septic tanks. missing data in some files account for totals of less than 100 per cent. Source: U.S. Department of Housing and Urban Development, Office of Interstate Land Sales Registration, Unpublished material obtained from the files, June, 1973. tanks most frequently (87.7 per cent), while the on water quality from private wells at the time the lowest use of septic tanks occurred in the Middle project was filed with OILSR.23 and South Atlantic states (65.7 and 65.0 per cent An indication of road quality can be inferred respectively). At the time of filing with OILSR, from the proportion of projects in which the roads less than half the projects had been approved for are to be dedicated to a public authority. Private septic tanks by a public authority.22 roads are usually developed to lower standards than Central water systems were more common than roads slated for public dedication. In only 18.2 sewer systems, yet private wells were the only per cent of the projects were the roads accepted for source of water for recreational lots in almost one- dedication by a public authority. Another 27.7 per third (29.6 per cent) of the projects. (Another cent of the projects reported that all roads would 5.6 per cent of the projects reported that some un- be dedicated to a public authority some time in the stated portion of their water would be supplied by future (subject to public acceptance). In one-third private wells.) The use of private wells could be (32.8 per cent) of the projects no roads had been even higher, since 6.3 per cent of the projects re- dedicated and no plans had been madeto ever do so. ported that no provisions for water had been made@, No arrangements were made for solid waste col- leaving the responsibility for water supply up to lection in 37.5 per cent of the projects filed with each individual lot owner. Private wells were most OILSR. In another one-third of the projects (33.9 common as the sole source of water in New England, per cent) garbage collection was available through where over half (54.8 per cent) private companies.24 In only 6.7 per cent of the ported them. In the remaining projects, water was projects was a municipality or public authority supplied through some form of central system oper- designated as responsible for garbage collection. ated by the developer, a private company, or a pub- The mean distance from recreational subdivi- lic authority. In only one@third (35.3 per cent) of sions to the nearest fire station was 10.6 miles, the projects had a health authority issued a report however, the data did not indicate whether or not 22 the nearest fire station would, in fact, provide Table 3. Availability of Utilities in Recreational services to a project. In some cases, as with U.S. Land Developments Reported by Respondents in ALDA Surveys, 1972 and 1973 Forest Service fire stations, they may not. Pro- jects were located farther away from health facili-' Per Cent of Projects ties. The national mean distance from recreational utility 1972 1973 projects to the nearest general hospital was 22 miles. Central Water 49.5 56.0 Data on site improvements are also available Central Sewer 28.8 42.0 Electricity 76.0 88.0 from several industry surveys. Table 3 presents Telephone 63.8 80.0 data on available utilities from two ALDA member- Cable TV 3.3 12.0 Natural Gas 8.3 17.0 ship surveys. A 1972 Housing Data Bureau Survey of Street Lights n.a. 24.0 120 recreational land developments reported commun- Septic Tank n.a. 31.0 Trash and Garbage n.a. 45.0 ity water systems in two-thirds of them and commun- Pickup ity sewer systems in one-fourth of them. Seventy Yard Maintenance n.a. 18.0 Paved Streets n.a. 44.0 per cent of the projects had paved roads.25 n = 487 n = 333 Future Maintenance Responsibilities. Respon- Source: American Land Development Association, The Land Industry Survey, 197 , and The Land In- sibilities for the maintenance and upkeep of the dustry Survey, 1973, (Washington: American facilities in recreational land developments fall Land Development Association, 1972, 1973), n.p. on various parties, depending on the types of im- provements and other considerations. Septic tanks ational subdivisions filed with OILSR contained no and private wells are the responsibilities of indi- recreational facilities to speak of, as shown in vidual lot owners. Community water and sewer sys- Table 4. In many cases, of course, the natural set- tems must be managed and maintained by some other ting may be recreational amenity enough. authority, either by the developers themselves (if Almost all recreational facilities in these they remain involved in the project) or by a pro- projects are reserved for the exclusive use of the perty owners I association. In most unimproved rec- property owners and their guests. In only 2.8 per reational subdivisions, developers are involved cent of the OILSR projects were all recreational fa- during the initial stages of site development and cilities open to the public, while in 2.6 percent of lot sales. Many developers have sold out within the projects selected recreational facilities were two years. In more improved second home and resort open to the public. projects, especially where recreational facilities Improvement Guarantees. In the majority of and housing are included in the initial offering, cases, the developer is taken at his word that facil- developers are likely to remain involved in pro- ities will be installed as promised. Usually, no jects longer and to carry more maintenance respon- formal guarantee is offered that the improvements sibilities during this period. will ever be completed.- Developers answering the OILSR filings included information on main- ULI survey reported that water systems were guaran- tenance responsibilities for internal road systems teed by improvement bonds in 30.3 per cent of the in recreational subdivisions as follows: a public projects, sewer systems in 22.5 per cent, streets in authority had accepted responsibility in 20.8 per 28.1 per cent, and recreational improvements in only cent of the projects; the developer in 26.7 per cent; 10.7 per cent. 26 Only 1.5 per cent of the 1,287 a property owners'association in 20.2 per cent; and projects surveyed at OILSR provided any guarantees each individual lot owner in 11.7 per cent of the that promised facilities would be constructed. 27 projects. (Maintenance responsibilities could not be determined from the data in the remaining 20.6 Use of Recreational Lots per cent of the projects.) Speculation. Most recreational lots are Recreational Amenities. Two types of recre- bought for one of two reasons--for use as a second ational amenities may be found in these projects-- or permanent homesite or for investment. Some rec- natural and man-made. The large maj ority of recre- reational lot buyers have both motives in mind, how- 23 Table 4 Per Cent of Recreational Land Developments With Recreational Amenities (Summary Results from Five Surveys) (1) (2) (3) (4) (5) Housing Recreational Amenities OILSR Filings California ALDA ULI.Survey Data n=1,287 Filings Survey n=178 Bureau n-361 n=333 Survey n=120 Existing Planned Existing Existing Existing Planned Existing Golf Course 9.6 8.1 20.5 22 28.1 14.6 39 Club House Facilities 13.4 13.5 24.1 25 24.7 15.2 63 Swimming Pool 16.2 10.8 9.1 45 40.0 21.9 66 Lake or Other Waterfront 18.3 5.9 13.6 47 55.1 8.4 n.a. Tennis n.a. n.a. n.a. 33 36.5 22.5 54 Horseback Riding n.a. n.a. n.a. 30 34.8 16.9 37* marina n.a. n.a. n.a. n.a. n.a. n.a. 32 Skiing Facilities n.a. n.a. n.a. 17 23.6 6.7 15 *Riding Stables Sources: (1) U.S. Department of Housing and Urban Development, Office of Interstate Land Sales Registra- tion, (Unpublished material collected from the files, June, 1973). (2) California State Department of Real Estate, "Land Project-Type Subdivisions Filed Between October 1969 and June, 1973," (Unpublished material obtained from the Department, Sacramento, California, 1973). (3) American Land Development Association, The Land Industry: 1973, Washington, American Land Development Association, 1973, n.p. (4) "Survey of Recreational Land Developers and Their Projects," (Unpublished survey conducted for this study by Richard L. Ragatz and the Urban Land Institute, Washington, 1973, n.p.) . (5) Housing Data Bureau, Recreational Land and Leisure Housing Report, Vol. 3, No. 8, flay, 1972. 24 ever, one of them is usually the predominate factor Table 5. Reasons for Purchase of Recreational Lots as Reported by Respondents in Northeastern in their purchase decision. Most recreational lots California Survey, 1972 are currently vacant, awaiting appreciation or home construction. Reasons for Purchase Per Cent of In the national survey of 7,190 families con Respondents ducted for this study, over one-third (38.2 percent) Speculative gain 31.0 of the respondents who owned Vacant recreational lots Future recreational use 22.0 said they bought them as investments rather than for Permanent retirement use 12.0 28 Capital gains 11.0 use as homesites. Other surveys have reported dif- Occasional retirement site 9.0 ferent results. As shown in Table 5, almost one- immediate recreational use 9.0 Purchased for estate (heirs) 5.0 third of the respondents to a 1972 California Survey other 1.0 checked "speculative gain" as their reason for pur- 100.0 chasing a recreational lot. A 1971 survey of rec- n = 564 reational lot buyers in Georgia also reported in- Source: Warren E. Johnston, "Remote Recreational vestment as the primary reason for buying a recrea- Subdivisions in Northeastern California" (un- tional lot--39.4 percent of All respondents checked published material obtained from the author, Department of Agricultural Economics, Univer- "investment" first.29 In a survey of recreational sity of California, Davis, 1972). projects in Washing-ton, one-fourthof the developers said that 60 or more per cent of their buyers pur- as a percentage of total sales dollars, while hous- chased recreational lots as investments. Another ing sales by developers have risen.35 third (37 per cent) of the respondents said that be- Reports on low buildout rates in recreational tween 30 and 60 per cent of their buyers purchased subdivisions come from other sources as well. One for investment.30 California district attorney stated, "Over the past Speculative lot buying appears to occur more ten years in Nevada County (population 26,346),.per- in unimproved recreational subdivisions than in more mits have been given to subdividers for the sale of improved projects. In the ULI survey (where improve- 19,317 lots. Yet only 319 homes were built during ment levels were higher than reported in the OILSR that same time."36 A California study released in data) developers responded that lessthan one-fifth 1971, stated: (18.3 per cent) of their lot buyers were motivated In 24 recreational subdivisions that include a total of 107,000 lots, 3,240 homes have primarily by investment opportunities.31 However, been built since the lots Iwere first offered three-fourths (75.6 per cent) of the respondents for sale in 1960., This is anaverage build- out rate of 0.3% per year; it wo uld take 150 listed "investment" as the second most important years to fill half of the lots if past trends factor influencing their customers. continue into the future.37 Homesites. Only a small percentage of recrea- In 1971, the Pennsylvania Vacation Land Developers tional lots have been developed as homesites to Association surveyed buildout rates in 26 Pennsyl- date. In general, the buildout rate--the ratio of vania projects which contained 25,000 lots, of lots with homes on them to the total number of sub- which 18,000 had been sold. The overall buildout divided lots in a project--is very low.32 Industry rate was 20.6 per cent. Of the four projects which sources estimate that each year housing starts oc- were 10 or more years old, 25.6 per cent of the lots cur on approximately two per cent of the recrea- which had been sold had houses on them, producing tional lots sold.33 Another industry observer an annual buildout rate of 2.5 per cent or less states,"Atmost recreational developments the ratio Results from the 1973 ALDA survey showed that of houses built to lots sold is as low as five per 32,151 homes had been constructed on 190,300 lots cent :,34 , These buildout estimates do not reflect the sold since the projects had been opened. These efforts in recent years of many larger developers figures produced an overall buildout rate for lots to increase their buildout rates by getting into sold at 16.7 per cent, but did not indicate the an- housing construction themselves. During the last nual rate.39 The overall rate was 12.7 per cent couple of years, lot sales have declined slightly when all of the unsold subdivided lots were in- 25 cluded. ALDA's 1972 survey reported an overall pickup trucks with camping units on the back to buildout rate of only seven per cent.40 $25,000 motor homes. Low buildout rates in recreational subdivisions interest in camping has boomed in recent years. are caused by several factors. One major cause is The U.S. Forest Service estimated that about 40 mil- the fact that many lot owners buy for investment lion people went camping in 1971.46 The production and never intend to use the property in the first of recreational vehicles (RVs), especially motor place. Developers responding to the ULI survey homes, has increased dramatically from an estimated stated that the buildout was low most often because 80,300 shipments in 1962 to 747,500 by 1972. (These "the buyer only bought for investment purposes." included travel trailers, truck campers, camping The next most frequent response (29.7 per cent) was trailers, motor homes, and pickup covers.) Motor that buyers could not afford to build homes on their home production alone increased 84 per cent, from recreational lots.41 Many of the lots are bought 57,200 units in 1971 to 116,800 units in 1972.47 on installment contracts which take as long as 10 The Recreational Vehicle Institute estimates that, years to pay off. Since the title to the land does there are nearly 4.5 million RVs now used in the not usually transfer to the lot buyer until the last U.S., costing an average of $8,651 each. installment is paid, home construction must wait un- The majority of these RVs and other campers til the buyer finishes paying for the property. use the more than half million campgrounds in the A North Carolina study found that the majority United States today.48 However, some of them use of lot owners (54.8 per cent) made improvements in recreational lots, where temporary shelters such as their property within 24 months of purchase.42 The tents and RVs are allowed. Over half the developers report added: responding to the ULI survey, however, did not per- If the property remains vacant more than mit temporary shelters such as mobile homes, recre- three years after acquisition, the prob- ational vehicles, or tents to be used on recrea- ability of its being converted to resi- dential use in any.giveri succeeding year tional lots. Approximately one-fourth (24.7 per diminished sharply. Households who are cent) of the developers permitted the use of recre- most likely to improve vacant property were those who acquired the property for ational vehicles on all lots, and 22.5 per cent per- a permanent residence rather than for mitted tent camping on all lots. In some instances, recreation or investment, and households whose heads were younger, had graduated recreational vehicles and tents were allowed only from college, and were employed in a pro- in designated areas (16.3 and 14.6 per cent of the fession.43 Another survey reported that only two to five per respondents respectively).49 In almost every case cent of the purchasers bui Ilt on their lots within mobile homes were prohibited more often than recre- two years.44 The Siskiyou County, California sur- ational vehicles or tents. vey reported that 10.6 per cent of the respondents In some cases land has been subdivided into intended to build a home on their recreational lot recreational lots specifically designated for camp- within three years of the survey. Another 13.7 per ing use. Some of these lots are managed in the cent intended to wait nine years or more, and al- form of a club, while others are fee-simple lots most half (49.8 per cent) stated that they had no sold for camping only. One club concept is called intentions of ever building. Another 10.3 per cent the multiple-ownership club. Here, the customer is of the respondents planned to use a mobile home on offered a share in the membership of a development which entitler. him to visitation rights to any camp- their lot, while 6.6 per cent said they would use their lots for camping.45 ing site within the project. Another camping club . Other Uses of Recreational Lots. Some recrea- arrangement is the "exclusive use rights club," a tional lots are used for camping. They are either nonprofit corporation. Here the club member buys bought specifically for that purpose, or are used the rights to the exclusive use of a particular for camping until the buyer can afford to build a camp site. Use rights are assigned for each site on a long-term basis. When some predesignated per- second home. Here, camping is referred to primar- ily as tent camping or camping with some form of centage of the sites have been assigned, the devel- recreational vehicle, which includes everythingfrom' oper may turn the ownership of the entire operation 26 over to the club. A few recreational subdivisions centage is considerably higher. In Maine, almost sell lots out-right for the express purpose of camp- one-fifth (18.5 per cent) of all housing units are ing. These campground "clubs" operate like condo- second homes ; in Vermont, 16.5 per cent; and in New miniums. Each member receives fee-simple ownership Hampshire, 15.6 per cent. At the county and town- of a camping site as w@ll as communal ownership of ship level second homes can account for even greater common facilities. proportions of total housing units. According to the 1970 Census, second homes accounted for over National Stock of Second Homes half the total.housing units in 28 countiesf and Dwelling units used as second homes are much over one-third of the dwelling units in 88 coun- less plentiful than recreational lots. Based on a ties.58 survey conducted for this study, approximately 3.5 National Distribution of Second Homes million households owned second homes in 1973, or Second homes are more evenly distributed around 5.1 per cent of all U.S. households.50 Of these, the country than recreational lots,but many of them 202,290 householdswere estimated to own resort are still concentrated in a few subregions as shown condominium units. in Figure 5. In 1970, almost one-third (32.6 per The U.S. Census reported slightly over 2.1 mil- cent) of the second homes in the U.S. were located lion second homes in 1970 with nearly 2.9 million in Michigan, New York, Texas, Wisconsin, and Cali- households reporting second home ownership.51 As- fornia, in that order. Michigan had the most sec- suming steady growth in second home ownership during ond homes in 1970 with 8.8 per cent of the total na- the late 1960s, other surveys suggest that the Cen- tional stock, followed by New York with 8. 5 per cent. sus figures may understate the true figures. A Five more states added to th ese account for half of study done by the University of Michigan Survey Re- the second homes in the country--Pennsylvania, Min- search Center in 1964 reported 2.35 million house- nesota, Maine, North Carolina, and Missouri. Hawaii holds owning second homes.52 And in a survey con- 59 4 reported the fewest with only 3,053. (Appendix B ducted by the American Telephone and Telegraph Com- presents the number of second homes by state, as a pany, 2.97 million households were reported to own percentage of total second homes in the U.S.,and as second homes in 1965.53 a percentage of total.housing units in each state. Appendix C presents the number of households owning Number of Second Homes Built Annually second homes by state as a percentage of total Estimates of annual second home construction households per state .and as a percentage of total range from 75,000 to 250,000 units. The actual fig- households owning second homes.) ure was probably around 150,000 units prior to the There are no data which indicate what propor- economic recession in 1974. tion of these second homes are located in recrea- No one keeps records of annual additions to tional land developments versus on individual, scat- the nation's second home stock. However, as in the tered lots outside of subdivisions. case of recreational lots, industry estimates are available. Some estimates from the early 1960s are Shifts in the Distribution of Second Homes higher than others as recent as 1970. Some 100,000 Since 1950 the national distribution of 3econd second homes were reported under construction annu- homes has shifted, with the South showing the larg- ally in the early 1960s.54 In 1969, the National est proportional gains as indicated in Table 6. Association of Home Builders (NAHB) estimated that The South contained only 16.4 per cent of the na- 130,000 second homes were built that year.55 In tion's second home stock in 1950. By 1970, 29.4 1972, NAHB estimated that 95,000 second homes were per cent of the nation's second homes were located constructed.56 in the S'outh.60 Of the 20 states containing the Nationally, second homes account for approxi- most second homes in 1950, only six increased their mately 3.1 per cent of the total U.S. housing stock share of the total by 1970. On the other hand, all (although these Census figures are considered some- but five of the remaining30 states showed increases what low).57 In some rural areas, however, theper- in their share of the total by 1970. 27 Figure 5. Second Homes in the U.S., 1970 (1 dot 1,000 second homes) 00 Source: U.S. Department of Commerce, Bureau of the Census, U.S. Census of Housing, 1970 Detailed Housing Characteristics. (Washington: Government Printing Office, 1972). Table 6. Distribution of Second Homes in the United States by Region, 1950, 1960, and 1970 Per Cent of Total Second Homes in United States Region - 1950 1 1960 2 19703 Northeast 42.7 36.8 26.0 New England 15.6 13.2 10.3 Middle Atlantic 27.1 23.6 15.7 North Central 27.8 27.7 31.1 East North Central 20.8 19.1 19.6 West North Central 7.0 8.6 11.5 South 16.4 22.0 29.4 South Atlantic 8.4 11.5 13.4 East South Atlantic 2.1 3.5 5.9 West South Atlantic 5.9 7.0 10.1 West 13.1 13.5 13.5 Mountain 4.2 4.5 5.5 Pacific 8.9 .9.0 8.0 The 1950 count of second homes was derived from the United States Bureau of the Census category called, "Seasonal Vacant Dwelling Units." 2The 1960 count of second homes was derived from the United States Bureau of the Census categories called, "Units Held for occasional Use" minus those "Vacant for Migratory Workers," plus "Other Seasonal Vacant Units." 3The 1970 count of second homes was derived from the United States Bureau of the Census categories called "Rural Seasonal Vacant" plus "Other Rural Vacant." Sources: United States Department of Commmerce, Bureau of the Census (1) U.S. Census of Housing, 1970, Detailed Housing Characteristics, U.S. Summary (Washington: Govern- ment Printing office, 1972), Final Report HC(l)-B-1, Table 32. (2) U.S. Census of Housing, 1960, States and Small Areas, U.S. Summary (Washington: Government Printing Office, 1963), Final Report HC(l)-l, Table 3. (3) U.S. Census of Housing: 1950, U.S. Summary (Washington: Government Printing office, 1953), Final Report H-Al, Table 17. Many second homes predate the recreational lot 1970 Minnesota survey ranked accessibility as the boom of the 1960s. The 1967 Census study reported first, and the natural site! amenities as the second that almost half (48.4 per cent) of the nation's most important factors in choosing their home loca- second homes were built before 1950. One-fourthwere tions.62 Since most people commute to their second built during the 1950s, while the remaining one- homes by automobile, site locations are very much a fourth were built in the 1960s. The highest per- function of that commuting distance. As shown in centages of older second homes were reported in the Figure 6 the majority of second homes are located Northeastern and North Central states.61 (Appendix within 100 miles of their owner's primary homes. D presents shifts in the distribution of second The number of second homes decreases sharply at com- homes for each state from 1950-1970.) muting distances above 200 miles. These distances vary in different parts of the Factors Influencing the Location of Second Homes country. Second homes are located closer to their Accessibility from the owner's primary resi- owner's primary homes in the Northeast, and furthest dence and the natural amenities at second home sites in the South and West. Among a few higher income are two major factors influencing second home loca- groups there is an increasing tendency to commute to tions. second homes by air, encouraging greater flexibility Distance Between Second and Primary Homes. Ac- in locations. cessibility is a key factor in the consumer's choice Natural Amenities in Second Home Areas. The of a second home location. Second home owners in a natural amenities of the second home site and/or 29 Figure 6. Distances Between Second Homes and opments are attractive to second home development, Their Owners' Primary Homes especially if they include a ski resort. And, having Per Cent a national park for a backyard also appeals to many 30.16 27.8 20.9 second home buyers. A survey in Washington discussed United States the importance of adjacent or nearby public lands as n = 1,496,000 msiwkim" a factor influencing second home locations: 0-50 50-99 100-199--200-499-500#;- Miles 43.0 It appears that while many developments pro- vide more elaborate facilities such as club Northeast 25.1 houses and golf courses, most people purchas- n = 542,000 ing lots in vacation home developments seem to like being close to "nature" with forest- ed sites, views, lakes, rivers, and beaches. 36.1 There is also a desire to be near the vast 25.1 and varied holdings of the state and federal North Central 14.6 17.8 governments.66 MMMMM n 474,000 Although millions of acres of barren desert __24.7 17.9 19.7 23.4 have been subdivided into recreational lots, very South 14.3 few people seem to want a second home in the desert. n 245,000 A consumer survey conducted by the Building Products 315 35.5 Guide asked potential buyers where they would prefer xxx, West 17.3 their second homes to be located. Only five per n 235,000 9.7 cent chose a desert environment. Lake, mountain, 40 IX, -1 and seashore locations were most popular.67 Source: U.S. Department of Commerce, Bureau of the Census, Second Homes in the United characteristics of Second Homes States, (Washington: U.S. Government Print- Type. Second homes cover a wide range of hous- ing-Office, 1969), Current Housing Reports, Series H-121, No. 16. ing types and architectural styles--everything from the surrounding region are another major factor de- termining where second homes occur. A survey of second home owners in New England ranked the "quali- Vable 7. Reasons for Choice of Second Home Sites ties of the site" as the most important factor in- Reported by Respondents in Northern New England Vacation Home Survey, 1966 fluencing the buyer's choice, as shownin Table 7. Water appears to be the biggest natural attraction Reasons for Choice Per Cent of 1 to second home owners. The New England survey re- Respondents ported that 86.3 per cent of the respondents had Qualities of the site 74.1 direct access to a body of water from their second Bodies of water 51.5 home.63 A study in Michigan reported that over 55 Scenic view 44.5 Seclusion 29.8 per cent of the second homes sampled were located Woodlands 26.3 on an inland lake, 24 per cent were located on the Topography 17.3 Regional attractions 43.6 Great Lakes, and another 10 per cent were located Proximity to home 20.8 on a river or stream.64 The report stated that"89 Relatives nearby 14.5 Expense 11.0 per cent of the vacation homes examined in this Cultural attractions 10.1 study are located on or within a five minute walk Proximity to shopping 1.8 n = 544 of some body of water." A consumer survey of 1,000 __J New York apartment dwellers reported over two-thirds 1 Total responses exceed 100 per cent since some respondents gave more than one reason for (67. 7 per cent) of the respondents stating a prefer- their choices. ence for waterfront locations.65 Another 18.5 per lik,8 Source: United States Department of the Interior, cent wanted a second home in the mountains, while Bureau of Outdoor Recreation, Northern New 11.5 per cent preferred an old farm house in the England Vacation Home Study, 1966 (Washington: Government Printing office), 1967), p. 6. country. Mountain locations for second home devel- 30 small, one-room hunting cabins to do-it-yourself A- homes.75 Respondents to an ASPO survey of rural frames; from modern, conventionally built homes to planning agencies reported that 58 per cent of their resort condominiums. They exhibit a wider range of jurisdictions contained older second homes which did freedom in architectural style than most primary not meet current housing standards.76 over half the homes. Still, approximately half the second homes respondents to the 1967 Census study of second homes being built today are conventionally built houses. 6.8 referred to their units as "vacation cottages.,,77 Prefabricated housing--precut, modular, and manufac- The 1967 Census study reported that almost half tured units--also account for an increasing share of the second homes surveyed (43 per cent) were be- of today's second home construction. In the ULI tween 500 and 1,000 square feet in size. Over one- survey, 12.4 per cent of the projects included pre- fourth were less than 500 square feet, and the re- fabricated or manufactured housing; 7. 9 percent con- maining fourth were more than 1,000 square feet.78 tained mobile homes.69 Approximately 10 per cent only one-third (36.4 per cent) of the existing sec- of the mobile homes manufactured each year--50,000 ond homes in the country had five or more rooms. units--are used as second homes.70 However, the This is considerably less than the national norm for proportion of all second homes which are mobile conventional housing (the 1970 Census of Housing re- homes is pirobably higher, since some mobile homes ported that 60. 7 per cent of all the housing units in end up as second homes after being used for several the country had five or more rooms),and while 17.7 years as primary homes. per cent of all second homes had two rooms or less, Resort condominium units are capturing an in- only 5.5 per cent of all houses in the U.S. in 1970 creasing share of the second home market. The na- were this small.79 Since the sample surveyed repre- tional household survey conducted for this study sents all second homes built over time, the data are found that approximately 6 per cent of the second weighted by older,@smaller units and do not reflect home owners responding owned resort condominiums.71 the true proportion of more modern second homes be- Certain types of condominiums which offer rental ing built today. programs operated by a management company must reg- The 1967 Census study reported several other ister with the Securities and Exchange Commission. statistics on second homes.80 Some 14 per cent of As of January 1973, 43 out of an.estimated 700 con- the units had no heat, while only 22.3 per cent had dominium projects with securities aspects had reg- central heating. Almost all had some type of kitc'h- istered with the SEC.72 en facilities (97.4 per cent), and most of them had Only 3.9 per cent of the 1,287 projects sur- electricity (91. 1 per cent)..- Over half (58. 3 percent) veyed at OILSR contained condominium units at the had plumbing. Another survey of second home facil- time of registration. The highest regional concen- ities in 1966 reported that 97 per cent had electric- trations of condominiums in recreational land devel- ity, 95 per cent had plumbing, 67 per cent had some opments registered with OILSR were found in New Eng- form of heating unit, and 65 per cent were insulated land, the South Atlantic states, and in the Pacific for year-round use.81 states.73 Over one-fifth of the respondents to the Cost. Second home costs vary as much as their ULI survey stated that they included condominium architectural styles. Today, some do-it-yourself units in their projects, while 5 per cent of them prefab structures run as low as $1,500, while many developed condominium projects exclusively.74 conventionally built second homes are priced in the Size and Facilities. About half of today's $30,000 to $40,000 range. The 1,967 Census study re- second homes are conventional houses, although in ported the median market value of second homes (in- the past small cottages and cabins, seldom winter- cluding lots) at only $7,800.82 Almost two-thirds ized and generally inadequate for year-round occu- (65 per cent) were valued at less than $10,000, pancy, were more common. A 1965 survey of second while only 12.3 per cent were valued at $20,000 or home owners reported that one-third of the respon- more. Median values were highest in the South dents owned A-frames, one-third owned cabins, about ($9,700), reflecting the fact that the highest pro- 10 per cent referred to their second homes as cha- portion of recent.second home construction has oc- lets, and 10 per cent were modern, conventional curred there. A more recent study in Wisconsin re- 31 ported the median value of second homes surveyed at ing leisure time. In some cases, second homes are $13,000. Still, some 40 per cent of the units sur- converted into permanent, year-round residences, of- veyed were valued at less than $10,000.83 In a ten when their owners retire, or when sold to other 1971 survey of recreational land projects (see families in the primary home market. Table 8), 42 per cent of the developers reported Occupancy Rates. The typical second home is the average selling price of new second homes in used two or three months a year. Occupancy rates for their projects was over $30,000, exclusive of the second homes--the number of days they are occupied land. Only 24 per cent reported average prices of per year--vary according to season, depending on such less than $20,000. Prices of condominiums were even factors as the distance between the owner's second higher; 64 per cent of the respondents reported the and primary home, vacation and employment cycles, average price of a condominium unit above $30,000. and seasonal recreational activities available at the second home site. The 1967 Census study found Table 8. Average Prices of Single Family Second that almost all second homes (92 per cent) were used Homes and Resort Condominiums Built in Recreational sometime during the year and that the median dura- Land Developments, 1971 tion of occupancy in 1966 was 53 days as shown in Table 9. Regional variations ranged from a low of Per Cent of Respondents n 120 47 days in the West to a high of 59 days in the Average Prices -Single Family Northeast. Over one-fourth of the respondents Second Homes Condominiums (28.3 per cent) occupied their second homes for less than 30 days during the year, while another fourth Less than $10,000 4.0 .0 $10,000 to $19,999 20.0 7.0 (24.8 per cent) occupied them 90 days or more per $20,000 to $29,999 34.0 29.0 year. A more recent survey in Vermont found that $30,000 to $39,999 18.0 35.0 $40,000 to $49,999 14.0 26.0 most second homes were annually used 30 days or $50,000 or more 10.0 3.0 more, while a few were used over 120 days. The most 100.0 100.0 typical use was between two and three months.84 I other local studies conducted in Minnesota and Source: Housing Data Bureau, Recreational Land and Wisconsin also reported that second homes were Leisure Housing Report, Vol. 3, No. 8 (May 8, 1972). occupied approximately 50 days per year.85 Seasonal Occupancy. Seasonal occupancy of sec- Use of Second Homes ond homes varies according to such factors as recre- Speculative gain has been a major factor influ- ational opportunities available at different times encing many consumers' decisions to purchase recre- of the year, the times.when families traditionally ational lots, but most people tend to buy second take their vacations, and the climate. Most second ,homes for their.own immediate use and,enjoyment dur- homes are used intensively during one particular Table 9. Duration of Second Home Occupancy by Region of the United States, 1966 Per Cent of Second Homes Duration of Occupancy United States Northeast North Central South West N = 1;496,000 n = 542,000 n = 474,QOO n = 245,000 n 235,000 Less than 30 days 28.3 23.7 31.4 36.1 26.1 30 to 59 days 29.0 26.8 29.2 18.8 42.5 60 to 89 days 17.9 24.3 16.5 9.4 13.3 90 to 179 days 19.3 18.7 21.0 20.9 16.1 180 days or longer 5.5 6.5 1.9 14.8 2.0 100.0 100.0 100.0 100.0 100.0 median days occupancy 53.0 59.0 49.0 52.0 47.0 Source: United States Department of Commerce, Bureau of the Census, Second Homes in the United States (Washington: Government Printing office, 1969), Current Housing Reports, Series H-121, No. 16. 32 season and sit vacant during the rest of the year. for permanent housing. And as industries move into In much of the country, summer is the peak season. the suburbs and commuting patterns extend further A Wisconsin survey reported peak second home occu- into the hinterlands, some people are finding it pancy in July and August and lowest use in December possible to convert their second homes to permanent and March.86 The 1967 Census study reported that use while remaining fully employed in their current almost two-thirds (61.2 percent) of the respondents jobs. used their second homes only during certain seasons Converting second homes to permanent use has of the year. In the South and the West, however, been going on for years. A 1959 report by ASPO where the climate is less of a factor, over half of stated that " . . . in metropolitan areas, some sum- the respondents used their second homes occasionally mer cottages are being converted to year-round resi- throughout the year rather than only during one par- dences; and areas platted for summer cottage devel- ticular season. opment have become full-scale residential develop- Rentals. A few second homesL are rented during ments."90 A 1957 article in the Milwaukee Journal portions of the year, increasing the duration of stated that: their occupancy. The Northern New England second The summer cottage is gradually vanishing in Southern Wisconsin. Almost none are home survey found that 17.6 per cent of the units being built on the small lakes near Mil- surveyed were rented sometime during the year.87 waukee. Many of the existing cottages are being converted for year-round livingPl The 1967 Census study reported that only 6.8 per A recent study in the Two Rivers region of Vermont cent of all second homes in the country were rent- found that some townships had experienced conversion ed.88 However, rental rates can run much higher factors as high as 34 per cent per year.92 In War- where a variety of recreational activities are pos- ren County, Virginia, over 20 per cent of the 1,500 sible during different seasons of the year. A Sur- homes in recreational subdivisions are now permanent- vey of second homes in Sevier County, Tennessee (a ly occupied, and full-time occupancy appears to be popular summer recreational area which also includes increasing.93 Three-fourths (76 per cent) of the a winter ski resort), found that a fourth of the planning agencies responding to the ASPO survey con- units were rented sometime during the yea'.89 ducted for this study had dwelling units in their Second home use could be expected to increase jurisdictions which were originally built as second as transportation facilities are improved and lei- homes, but are now permanently occupied.94 Many re- sure time increases. The renting and communal own- ership of second homes, especially condominium . units spondents to the survey said that second homes had with rental management programs in "four-season" a strong tendency to become first homes over time: experience has shown that second homes recreation areas, will also tend to increase over- tend to become first homes sooner or later. all second home occupancy, making it less seasonal many second homes have been sold to and more constant throughout the year. Many new other families for first homes. condominium units built in second home projects are . . . there is no such thing as a second being offered with a rental-management plan which home subdivision. It may be designed that permits their owners to use the property as they way, but in a short time it is permanent. 95 wish during one season, while a management entity . . . handles maintenance and rental of the unit during Also, some lots and housing in recreational land other seasons. In some cases, rentals are handled developments are never intended for use as recre@ through a rental pool arrangement operated by acen- ational property, but instead are marketed to first tral agency. home buyers. One development visited during field Conversion of second Homes to Permanent Homes. work for this study was selling approximately 20 Over time, some secondhomes a ,re converted into per- per cent of its housing to consumers in the first manent residences. Retirees moving into their sec- home market.96 Designing recreational land develop- ond homes on a year-round basis account for many ments with mixtures of housing which appeal to both such conversions. Other second homes are converted second and primary home markets is likely to become to permanent use by successive owners in the market more common if the second home business continues to 33 decline. A recent trade journal article advised timated in 1973 that there were approximately 10,000 resort condominium developers to locate their companies subdividing recreational land and develop- projects no more than 150 miles from prospective ing second home projects. 102 These companies ranged owners' jobs and primary homes, citing the impor- from small "mom and pop" operations subdividing and tance of locating resort developments in areas of selling off their own farms and ranches to large, primary housing demand in the event that second publicly-owned corporations. In 1971, 21 of the 200 home sales fail.97 This strategy is encouraged by largest corporations in the U.S. were involved in families already opting for longer commuting times recreational land development, including Mobil, to live year-round in second home developments. One Standard, Shell, and Gulf Oil, Scott Paper, ITT, second home project in Pike County, Pennsylvania, Union Camp, Weyerhaeuser, Bendix, Swift, and Chrysler reports running two commuter buses daily to New Corporation.103 Most-recreational land firms, how- York City for its permanent residents, a distance ever, are privately owned according to the results of almost 100 miles each way.98 of two ALDA surveys shown in Table 10. in a few cases, recreational lots are serving The majority of recreational land firms have as low-income housing sites for rural families, fur- limited their activity to developing a single project ther increasing the extent of permanent occupancy at one time. Out of 1,509 land development companies, in recreational land developments. In Warren Coun- registered with OILSR, over three-fourths (83.4 per ty, Virginia, for example, lower income families cent) had only one recreational subdivision under way, have bought lots in inexpensive recreational sub- and only 2.5 per cent had five or more projects.104 divisions, either building their own homes or using The 1973 ALDA survey reported that their average mobile homes. In Deschutes County, Oregon, some member was developing two or three recreational permanent service employees of one resort develop- projects. ment were reported living in mobile homes in less As previously mentioned, most recreational land expensive recreational subdivisions nearby. developers sell only land, not housing. Respondents The conversion of second homes to permanent to the 1973 ALDA survey reported that 80 per cent of use is likely to continue well into the future, their income was derived from land sales, 10 per however the extent of these conversions is highly cent from housing sales, and 10 per cent from other tenuous, depending on such factors as future energy sources.105 Land sales have offered higher rates of and transportation costs, job opportunities, and return on the developer's investment in the past, as the availability of public services in rural areas. Intentions to convert recreational property to per- manent use appear fairly common, though. A 1970 Table 10. Ownership Status of Recreational Land survey in Green County, New York, reported that more Companies, Reported by Respondents in ALDA than half (58 per cent) of the nonresident land -Surveys-,- -1972 and 1973 owners in the county planned to become permanent Per Cent of Respondents Ownership Status - residents, most of them at retirement.99 In Vermont, 1972 1973 a 1972 survey reported that 45 per cent of the Publicly owned 14.2 13.0 second home owners interviewed planned to become permanent residents.100 And in the North Carolina Privately owned 64.2 67.0 Subsidiary of public survey, 10.6 per cent of the respondents stated company 17.2 17.0 that one of their reasons for purchasing a recre- Subsidiary of private ational lot was for future use as a retirement company 4.4 3.0 homesite. 101 10Q.0 100.0 n = 148 n = 123 Characteristics of Recreational Land Developers The American Land Development Association, the Source: American Land Development Association, The Land Industry Suyyey, 1972 and The Land Inju-s- trade association for recreational land developers, try Survey, 1973, (Washington: American Land Development Association, 1972, 1973), n.p. had a 1973 membership of 740 developers. ALDA es- 34 Table 11. Most Profitable Forms of Recreational Table 12. Gross Dollar Volume of Land Sales in Property Reported by Respondents to the ULI Recreational Land Developments, Reported by Re- Survey of Recreational Land Developers, 1973 spondents in ALDA Surveys, 1972 and 1973 Type of Property Per Cent of Selected Gross Sales Respondents Characteristics 1972 1973 Unimproved lot sales subdivision 42.9 Improved recreational home sub- 27.6 Reported division low sales $15,000 $18,000 Resort condominium 9.0 Reported management of resort operations 1.3 high sales $38,917,000 $29,600,000 High amenity second home com- 11.5 Average munities None have been profitable 3.8 sales $ 3,341,850 $ 3,183,150 Other 3.9 Total sales $411,297,404 $373,160,605 100.0 n = 124 n = 115 n = 156 1 1 1 Source: American Land Development Association, The Source: "Survey of Recreational Land Developers Land Industry Survey, 1973 (Washington: Ameri- and Their Projects, " (Unpublished survey can Land Development Association, 1972, 1973), conducted by Richard L. Ragatz and the Urban n.p. Land Institute, Washington: 1973), n.p. well as requiring much less front-end capital than mobility, and heavy advertising and mass marketing housing construction and the necessary related im- techniques employed by the industry. provements. Almost half (42.9 per cent) of the de- Increased Affluence. Probably the most impor- velopers responding to the ULI survey reported that tant factor influencing the growth of the recrea7 the sale of unimproved recreational lots was their tional land market was the increased affluence of most profitable activity, with improved lots rank- the American consumer. getween 1.950 and 1970 median ing second, as shown in Table 11. family incomes in the U.S. (measured in constant 1970 In 1971, an estimated 650, 000 recreational lots dollars) nearly doubled, from -$5,601 to $9,867.108 were sold in the U.S. at a total price of approxi- The percentage of families earning between $10,000 106 mately $5.5 billion. Gross sales volumes per and $15,000 increased from 20.7 per cent in 1960 to firm were averaging around $2 to $3 million in the 27.9 per cent in 1970; During the same period, the early 1970s, as shown in Table 12. The developers percentage of families earning more than $15,0 00 a responding to the ULI survey reported average gross year increased from 10.2 per cent to 23.7 per cent. sales for 1973 at $2.7 million.107 In 1950, only 14.2 per cent of all families earned Most recreational land development firms have more than $10,000 per year. been in business a relatively short while, as shown Increased ease of financing during the 1960s in Table 13. Almost half of those firms answering and early 1970s also facilitated rapid second home the ULI survey had been involved in recreational development. As land values increased (especially land development less than five years. The major- where the supply was limited such as along sea ity of these (62.7 percent) deal exclusively in rec- coasts), credit became easier to obtain and down reational land development. Less than one-fourth payments grew smaller, putting "recreational land (22.8 per cent) of the respondents were also en- financing within the reach of a much larger segment gaged in suburban subdivision development. of the population."109 Factors Influencing The Growth of Recreational Increased Leisure Time. Leisure time has also .Land Development increased over the last two decades, through more The growth of recreational land developmeht dur- frequent and longer vacations, increased longevity, ing the 1960s and early 1970s resulted from a com- and earlier retirements, thereby making second home bination of factors including increased affluence ownership more attractive. In 1940, only 25 per @among consumers, increased leisure time, increased cent of all wage agreements provided for paid vaca- 35 Table 13. Number of Years Which Developers Have Been Active in Recreational Land Development Per Cent of Respondents by Number of Years Type of Land Development Less than 5 to 14 15 to 24 25 or more Total 5 years years years years Land development of any type 37.8 43.6 10.9 7.7 100.0 Unimproved lot sales subdivisions 42.6 45.5 5.0 6.9 100.0 Improved second home subdivisions 55.3 35.3 5.9 3.5 100.0 High amenity second home communities 59.4 31.9 8.7 - 100.0 Condominium development 82.5 17.5 - 100.0 Source: "Survey of Recreational Land Developers and Their Projects" (Unpublished survey conducted by Richard L. Ragatz and the Urban Land Institute, Washington: 1973), n.p. tions. Today, over 90 per Cent of them do.110 In rural highways were added to the nation's road sys- 1940 the maximum paid vacation was about one week long, and the average number of paid holidays ap- tem. More importantly, the Interstate Highway Sys- Proximately two per year. Today, paid vacations tem, now more than 75 per cent complete with over average 2.2 weeks per year (an increase of 20 per 30,000 miles in operation, has provided urbanites cent since 1960 alone), and paid holidays average with high speed access into the countryside, d-rasti- 10 per year.111 The actual work week has not gone cally reducing driving times to recreation areas. 116 In 1950, 59 per cent of all U.S. families owned an down very much since 1940, declining only 6.5 hours, from 46.1 hours in 1945 to 39.6 hours in 1970.112 automobile; in 1970, that number had increased to But work weeks have become more concentrated. In 82 per cent.117 The number of registered passenger the late 1960s the four-day, 40-hour work week came cars increased from over 40,000,000 in 1950 to over into vogue.in Longevity and paid retirements have 89,000,00.0 in 1970. Although much less important also increased over the last two decades. Life ex- than automobile travel, increased air travel to pectancy at birth was 62.9 years in 1940 and 70.8 recreational land developments has made them even years in 1970.114 In addition, retired people have more accessible. The number of public and private had more money to spend than ever before in history. airports increased from 6,881 in 1960 to 11,261 in 1970. Passenger miles on scheduled air carriers in- Private pensions, deferred profit-sharing plans, and Social Security benefits have all increased since creased from slightly over one million in 1950 to 1950. While the number of people receiving Social 13.1 million in 1970.118 And the number of civil Security benefits almost doubled between 1960 and aircraft increased by over 50 per cent between 1950 1970i the amount of those disbursements tripled to and 1970. some $31, 000, 000 in 1970. In addition the number of Consumer Demand. The combination of a growing private pension and deferred profit-sharing plans national interest in recreation of all kinds coupled more than tripled between 1950 and 1970.115 with increased consumer spending power and the his- Increased Mobility. Improved transportation torical American desire to own land created an ex- facilities have been one of the most important fac- plosive market by the mid 1960s. The national in- tors making growth in recreational land development terest in outdoor recreation has increased markedly possible, providing the two-thirds of the nation's over the last several years. Total visits to Na- population living in metropolitan areas with effi- tional Parks increased from 33.2 million in 1950 to cient highway access to the countryside. Between over*200.5 milflon in 1971.119 Similar unprecedented 1950 and 1970 over 400,000 miles of municipal and trends in visits to state parks also I occurred be- 36 tween 1950 and 1970, increasing from 11.2 million 10 per cent receive some portion of their earnings visits in 1950 to 39 million in 1970.120 in the form of commissions. Millions of recreational lot buyers,were also motivated by "investment potential," following Will The Future Market For Recreational Land Rogers' advice: "Buy land; they ain't making any There will always be some market for recre- more." During the 1960s, land values approximately ational property, but the extent and size of that doubled while the value of common stocks rose by market is difficult to predict. Growth projections only 18 per cent.121 A- recent Gallup Poll conducted were prepared for this study based on past trends for the National Association of Realtors reported and recent surveys of consumer purchase intentions, that 9 out of 10 respondents considered real estate indicating that the national stock of recreational a good investment.122 lots and second homes could double by 1985. 125 Many people also bought recreational property (See Appendix E) However, gasoline shortages to use for fun--to escape the city and relax a bit followed by general economic recession have caused closer to nature. Today, over two-thirds of the a ma3or decline in recreational land development U.S. population lives in metropolitan areas. As activity since early 1974, leaving serious.doubts crime, pollution, traffic congestion, and noise about whether future rates of growth will come near have increased, many city dwellers have found sec- past levels when and if this industry recovers from ond homes a welcome retreat from the daily stress its current economic slump. While the'ranks of po- of urban living. A public opinion survey conducted tential second home buyers will swell over the next by the President's Commission on Population Growth few years as the post war baby boom generation en- and the American Future reported that 34 per cent ters its thirties, the prospects of continued high of the respondents wanted to live in the open coun- energy costs and mortgage interest rates threaten try, while another 30 per cent wanted to live in a to curtail demand further in the future. Consumer small town or city. only 14 per cent preferred preferences are another major unknown. Recrea- either a large city or a suburb.123 tional property is a luxury item whose future de- Marketing. All of the above factors combined pends on continually rising disposable incomes and to produce a ready market for the sale of recrea- consumer preferences on how that income is spent. tional lots and second homes. In response, devel- The rising costs of energy may also affect the opers and land merchants sprung up overnight to tap future location of recreational land development. this market, offering a wide range of products and For example, just as suburban developers have gone prices to meet every taste and pocketbook. massive back and sought out undeveloped, skipped over par- nationwide advertising campaigns helped to sell cels within the urban fringe, recreational land much recreational land. Billboards, magazines, developers may seek locations closer and with more newspapers, radio and TV commercials, direct mail- convenient access to the cities. Energy costs ings, visits, free dinners complete with slide alone, however, do not necessarily mean a reduction shows, prizes and so on, all plaved their part in in demand for recreational property. Consumers will enticing millions of consumers into buying recre- still be able to choose how to allocate their energy ational property. dollars. For example, some people may choose to in- High-pressure sales techniques also played a crease their use of mass transit and car pooling ar- major role in increasing the consumption of recre- rangements to commute to work, saving energy dollars ational land. Sales campaigns have frequently been for weekend commutes to their second homes. Or labeled "hard sell," especially in unimproved proj- rather than owning two homes, rising energy costs ects where the land may not easily sell itself. may encourage apartment living in cities coupled Another factor which has encouraged the "hard sell" with second home ownership. Some developers also in the recreational land industry has been the tre- suggest that increased energy costs will curtail va- mendous incentives placed on salesmen. According cation travel in favor of spending an entire vaca- to one survey, over three-fourths (76 per cent) of tion in a second home.126 Energy costs may have the salesmen in the industry are paid strictly on other effects on the second home business as well. a commission basis.124 Of the remainder, all but If heating fuel becomes scarce or too expensive, the 37 222-878 0 - 77 - 4 Table 14. Future Demand for Recreational Properties as Estimated by Recreational Land Developers Per Cent of Respondents by Estimation of Future Demand Recreational Property Will will Remain will Total Increase the Same Decrease Unimproved lots in recreational subdivisions 44.8 17.5 37.7 100.0 Improved lots in recreational subdivisions 74.0 22.7 3.3 100.0 @Lots in high amenity second home communities 80.7 12.9 6.4 100.0 Resort condominiums 84.3 9.6- 6.1 1 100.0 Source: "Survey of Recreational Land Developers and Their Projects," Unpublished survey conducted by Richard L. Ragatz and the Urban Land Institute (Washington: 1973), n.p. hundreds of thousands of recreational lots already recreational lots would decrease substantially while subdivided in the South and southwest may become demands for improved recreational lots, lots in high more attractive as future homesites. amenity second home communities, and resort condo- In spite of the energy and economic issues miniums would increase as shown in Table 14. Half facing the industry, other forces also indicate of the developers (50.3 per cent) responding to major changes may be on the way. Even before the the survey reported that they had no plans to ex- energy crisis in 1974, changing consumer demands, pand the unimproved recreational lot portion of increased government regulation, and the unethical their businesses as shown in Table 15. On the public image of the industry were all beginning to other hand, over half (52.6 per cent) did intend cause an increase in the proportion of improved to expand their operations in improved recrea- recreational properties and housing in relation to tional lots, and 41.5 per cent intended to expand unimproved recreational lots offered by developers. their activities in the resort condominium field. Recreational land developers responding to the ULI New concepts of owning recreational property survey reported that the unimproved lot sales seg- may play an increasingly important rolein the future ment of the industry was by far the most competitive of recreational land development industry. Among sector, as compared with second home and resort the innovations which have been tried are time condominium projects. 127 Asked to predict future sharing, undivided interest, and rental and exchange demands for various types of recreational property, programs. Rather than buying a second home with the developers responded that demands for unimproved exclusive occupany rights, time sharing options Table 15. Developers' Plans for Future. Expansion in Selected Types of Recreational Land Developments Per Cent of Respondents by Plans to Expand Type of Recreational Land Development No Yes Uncertain Total Unimproved lots in recreational subdivisions 50.3 32.2 17.5 100.0 Improved lots in recreational subdivisions 25.8 52.6 21.6 100.0 High amenity second home communities 34.5 37.4 28.1 100.0 Resort condominiums 28.1 41.5 30.4 100.0 Source: "Survey of Recreational Land Developers and Their Projects," Unpublished survey conducted by Richard L. Ragatz and the Urban Land Institute (Washington: 1973), n.p. 38 permit consumers to purchase a "time-share" of a of property, which may include recreational facili- dwelling unit at less than full cost, sharing fee ties reserved for the use of all shareholders. De- simple ownership with several families. Such ar- velopers have also experimented with rental and rangements would permit a single dwelling unit to exchange programs, operating rental pools for con- be more intensively used than the average second dominium owners which include advertising, mainte- home, but would require a fairly sophisticated man- nance, and other services. So far, such shared ar- agement operation.. The undivided interest concept rangements for second home use have had little im- is a common ownership arrangement which has been pact on the market, but they may become increasing- tried in camping developments. It allows many fami- ly attractive as increased energy and housing costs lies to-purchase undivided shares of a single piece restrict the market for second home ownership. NOTES 1. U.S. Department of Housing and Urban Develop- 4. Unpublished survey conducted for this study by ment, office of Interstate Land Sales Registra- the Opinion Research Corporation, Princeton, tion, Unpublished material obtained from the N.J., using a stratified sample of 7,190 U.S. files, January, 1974. The Office ofInterstate households, October, 1973. The survey found Land sales Registration (OILSR) was establish- that 3.4 per cent of all households own a va- ed in August, 1969 within the U.S. Department cant recreational lot. The total number of of Housing and Urban Development, to administer U.S. households was obtained from the U.S. De- the Interstate Land Sales Full Disclosure Act partment of Commerce, Bureau of the Census, of 1968. Under the Act, companies offering 50 Demongraphic Projections for the United States, or more unimproved lots for sale or lease (Washington: Government Printing Office, 1973). through the mails or by means of interstate Current Population Reports, Series P-25, No.476, commerce under a common promotional sales plan, Tables 7 and E. pp. 25-26. must file a Statement of Record with OILSR and provide all prospective buyers with a Property 5. American Land Development Association, The Report covering 20 or more points of informa- Land Industry Survey, 1973 (Washington7-A-meri- tion about the project. HUD has the authority can Land Development Association, 1973), n.p. to take several types of legal action for non- compliance or inadequate compliance with the 6. Ibid. The 123 companies responding to the regulations. Property Reports for any project AIDA survey subdivided 297,283 lots. may be obtained from HUD for a fee of $2.50 each by writing HUD/OILSR, 451 Seventh St. S.W. 7. Interview with Gary Terry, Executive Vice Pres- Washington, D.C. 20410, and including the name ident, American Land Development Association, of the developer, the development, and the lo- Washington, D.C., July 10, 1973. cation of the subdivision. B. U.S. Department of Commerce, Bureau of the Cen- 2. Interview with Alan Kappeler, Assistant Deputy sus, Census of Governments, 1967 Taxable Pro@ Administrator, Office of Interstate Land Sales perty Values, (Washington: Government Print- Registration, U.S. Department of Housing and ing Office, 1968), Volume II, Table 6. The Urban Development, may 2, 1974. There are 1972 Census of Governments did not collect va- several reasons for extensive nonfiling with cant lot data except for selected urban coun- OILSR. First, filing was not required until ties. See U.S. Department of Commerce, Bu- the federal law (the Interstate Land Sales reau of the Census, 1972 Census of Governments, Full Disclosure Act) went into effect in 1969. Taxable Property Values and Assessment - Sales in addition, the law exempts some projects Price Ratios, (Washington: Government Printing from filing (such as those with less than 50 office, 19.73), Volume 2, Part I, Table 9. lots or where all lots are 5 acres or more in size). Finally, noncompliance with the law is 9. Lyle E. Harrell, "Tour of Subdivisions in Las- still common. sen and Madera Counties," Unpublished paper, Josephine County Planning Department, Grants 3. John P. Workman, Donald W. MacPherson, Darwin Pass, Oregon, 1971, p. 1. B. Nielsen, and James J. Kennedy, A Taxpayer's Problem - Recreational Subdivisions-in Utah, 10. John P. Workman, et. al., A Taxpayer's Problem (Logan, Utah: Utah State University Press, - Recreational Subdivisions in Utah, M. S@it_ 1974), p. 3. OILSR dat -a for January., 1974 show p. 4. 45 projects in Utah containing 15,257 recrea- tional lots. Workman's study in Utah reports 11. Dr. Wilbert J. Ulman, Mountain Recreational that between 1962 and 1972, 334 recreational Communities and Land Use: The Summit Coun@y subdivisions containing 62,716 were developed: Experience, (Denver: Colorado Land Use Com- mission, December, 1973), p. 39 and 57. 39 12. Arizona Office of Economic Planning and Devel- 24. The OILSR data did not indicate wfiether ar- OPment, Planning Division, Arizona's Remote rangements had already been made with a parti- Subdivisions: An Inventory, (Phoenix: Office cular collection company or simply were avail- of the Governor, State of Arizona, January, able at the individual lot owner's option. 1975), p. 1. 25. Housing Data Bureau, Inc., Recreation Land and 13. National Association of Real Estate Boards, Leisure Housing Report, volume 3, No. 8, May 8, The Real Estate Market., (Washington: National 1972. Association of Real Estate Boards, annual sur- vey). 26. "Survey of Recreational Land Developers and Their Projects," Richard L. Ragatz and the 14. "Leisure Boom: Biggest Ever and Still Growing," Urban Land Institute, 2k. cit. U.S. News and World Report, (April 17, 1972), p. 45. 27. U.S. Department of Housing and Urban Develop- ment, office of Interstate Land Sales Regis- 15. U.S. Department of Housing and Urban Develop- tration, Unpublished material obtained from ment, Office of Interstate Land Sales Regis- the files, June, 1973. tration, Unpublished material obtained from 28. Unpublished survey conducted for this study by the files January, 1974. These recreational the opinion Research Corporation, Princeton, land projects include both registered projects N.J., op. cit. and projects which filed for and received ex- emptions under the provisions of the Inter- state Land Sales Full Disclosure Act. 29. John Hanmaker, "An Investigation of the Organ- ized Second Home Community Market in Georgia 16. "Survey of Recreational Land Developers and to Determine If Property owners Receive or Their Projects," Unpublished survey conducted Will Receive the Facilities for Which They for this study by Richard L. Ragatz and the Ui-- Pay," Unpublished Ph.D. dissertation, Georgia ban Land Institute, (Washington, 1973), n.p. State university, Atlanta, 1971, p. 187. This survey used a mailing list of land devel- opers combined from: (1) companies which had 30. Carolyn Feiss, Second Homes in Washington, registered recreational land projects with (Olympia: state of Washington, Washington In- HUD's Office of Interstate Land Sales Regis- teragency Committee for Outdoor Recreation, tration; (2) subscribers to Housing Data Bu- 1971), p. 19. reau, Inc. services which include Recreation Land and Leisure Housing Report, P.O. Box 97, 31. "Survey of Recreational Land Developers and Los Altos, California 94022; and (3) members Their Projects," Richard L. Ragatz and the Ur- of the urban Land Institute active in the rec- ban Land Institute, 2p. cit. reational land development field. The sample size was 1,800 and tne usable response rate was 9.7 per cent. 32. A word of caution about terminology is impor- tant here. The low buildout rate provides 17. U.S. Department of the Interior, Bureau of Out- some indication of the high degree of specula- door Recreation, Northern New England Vacation tion in the recreational lot market. But a Home Study: 1966, (Washington: Government careful distinction must be drawn between Printing Office, 1967), p. 18. overall buildout rates--the total number Of houses as a per cent of total lots subdivided 18. American Land Development Association, The Land to date--versus annual buildout rates, which Industry Survey 1973, op. cit. indicate the number of houses built each year compared to the total number of lots. Indus- 19. "Survey of Recreational Land Developers and try surveys and other studies often confuse Their Projects," Richard L. Ragatz and the Ur- these two figures. In addition, many of them ban Land Institute, M. cit. do not distinguish between the number of houses constructed as a percentage of all lots 20. U.S. Department of Housing and Urban Develop- subdivided. This, too, is an important dis- ment, office of interstate Land Sales Regis- tinction, since many recreational lots have tration, Unpublished material obtained from been subdivided but have not been sold. the files, January, 1974. 33. Gary Terry, "New Techniques in Recreational 21. American Land Development Association, The Land Land Development," Vacation Housing and Rec- Industry Survey, 1973, op. cit. reation Land Development, (Ann Arbor: Indu 's- trial Development Division, Institute for Sci- 22. It was not possible to determine from OILSR ence and Technology, the University of Michi- data whether public health approval of septic gan, 1973), p. 43. tanks was a blanket approval for the whole project or a specific approval of each indi- 34. Stanley Snider, "Is System Building the Best vidual lot. Answer for Your"Shelter Program?" Developers World, (July-August, 1973), p. 12. 23. It was not possible to determine from OILSR data whether the public health report on water 35. Housing Data Bureau, Recreation Land and Lei- quality had approved the water supply or not-- sure Housing Reports, Volume 3, No. 21 (Decem- only that a report had been issued. ber, 1972), p. 5. 40 36. Robert Cahn, "There's No Such Thing as a Free The physical count of second homes used in Lunch," Christian Science Monitor, (January this study was taken from the U.S. Census of 17, 1973), p. 11. Housing Category "rural vacant-seasonal" hous- ing units. Excluded from this category are: 37. State of California, The Resources Agency, De- (1) second homes in urban areas, and (2) rural partment of Soil Conservation, Environmental vacant farm units, both of which are not con- Impact of Urbanization on the Foothill and sidered within the scope of this study. In- Mountainous Lands of California (Sacramento: cluded in this category are other types of hous- State of California, 1971), p. 17. ing units such as: dwellings for loggers, mi- grant laborers, etc. While these latter hous- 38. Pennsylvania Vacation Land Developers Associ- ing types represent an overcount of the true ation, "Study Findings: Buildout Rate for number of second homes, the problem could not Pocono Projects," (East Stroudsberg, Pennsyl- be eliminated from the available data. Rural vania: Pennsylvania Vacation Land Developers housing units are all units outside of places Association, 1971), n.p. with populations of 2,500 or more and their immediately surrounding hinterlands. Seasonal 39. American Land Development Association, The vacant units are "intended for occupancy during Land Industry Survey, 1973, op. cit. only certain seasons of the year. Included are units intended for recreational use such as 40. American Land Development Association, Land beach cottages and hunting cabins, and vacant Industry Survey, 1972, op. cit. units held for herders, loggers, migratory labor, etc." Households owning second homes 41. "Survey of Recreational Land Developers and were derived from U.S. Department of Commerce, Their Projects," Richard L. Ragatz and the U.S. Census of Housing, 1970, Detailed Housing Urban Land Institute, 2a. @Lll- Fharacteristics, (Washington: Government Print- ing Office, 1972), Final Report HC (l)-Bl-52. 42. Raymond Burby, Household Decision Process in the Purchase and Use of Reservoir Recreation Land (Chapel Hill: University of North Caro- 52. John B. Lansing, Eva Mueller and Nancy Barth, lina, Water Resources Research Institute, Residential Location and Urban Mobility, ( -Ann 1971), p. 61. Arbor, Michigan: Survey Research Center, ln@ stitute for Social Research, University of 43. Ibid. Michigan, 1964). 44. Carolyn Feiss,.Second Homes in Washington, 53. American Telephone and Telegraph Company, "Sur- op. cit. vey of 9,231 Bell System Telephone Users,"(Un- published survey conducted by the Company 45. T.E. Dickinson and W.E. Johnston, "An Evalua- New York: 1965). tion of Owner's Expectation Of Building Within 54. "Second Home Trends Broaden Components Market," Remote Rural Subdivisions: Impacts on the Ru- Wood and Wood Products ral Community," (Ur-iblished paper presented XLVII (July, 1971), by the Joint Annual Meetings of the American p. 34; and "A New Look at Vacation Homes," Canadian and Western Agricultural Economics Journal of Home Building, (June, 1973), p. 160. Associations, Edmonton, Alberta, August 1973), n.p. 55. National Association of Home Builders, Pro- file of the Builder and His Industry, (Wash- 46. American Land Development Association,"Campers ington: National Association of Home Builders, are a New Breed of Pioneer," American Land, 1970), p. 183. volume 2, No. 2, (May 1973), p. 14. 56. "The Land Rush for Country Homes," Business 47. Recreational Vehicle Institute, Recreational Week (January 15, 1972), p.'76. Vehicles Facts and Trends, Des Plaines, Illi- nois: Recreational Vehicle Institute, 1973, 57. The 1970 Census reported 68,418,094 total hous- P. 19. ing units in the U.S. and 2,143,434 second homes. U.S. Department of Commerce, Bureau of 48. Ibid. the Census, U.S. Census of Housing, L970, De- tailed Housing Characteristics, (Washington: 49. "Survey of Recreational Land Developers and Government Printing Office, 1972), Final Re- Their Projects," Richard L. Ragatz and the Ur- port; HC (l)-Bl-52, Table 32. Figures for ban Land Institute, op. cit. second homes were obtained by combining the two C,ensus categories--"Rural Seasonal Vacant" 50. Unpublished survey conducted for this study by and "Other Rural Vacant." the Opinion Research Corporation, Princeton, N.J., op. cit. The 1973 Census figure of 58. Ibid. 67,430,000 U.S. households was used as the ba- sis for this estimate. 59. Ibid. 51. U.S. Department of Commerce, Bureau of the 60. These distributional changes among Census re- Census, U.S. Census of_Housinq, 1970, De- gions should only be considered rough approxi- tailed Housing Characteristics (Washington: mations since the definition of second homes Government Printing Office, 1972), Final Re- changed each time the Census was taken. The port HC (1), Appendix A-1 and Appendix B-7. definitions which were used to tally second homes are described in Table 6. 41 61. U.S. Department of Commerce, Bureau of the 76. American Society of Planning Officials, "Sur- Census, Second Homes in the United States, vey on Recreational Land Development," Unpub- op. cit- lished survey on local land use and develop- ment regulations affecting recreational land 62. John Borchert, Minnesota's Lakeshore: Re- developments, conducted by the American Soci- sources, Development, Policy Needs, (Minne- ety of Planning Officials, 1973. Mail survey apolis, Minnesota:.University of Minnesota, of 534 local and regional planning agencies Department of Geography, 1970), p. 35. consisting of: (1) subscribers to ASPO's Plan- ning Advisory Service; and (2) planning com- 63. U.S. Department of the Interior, Northern New missions in counties with three or more recre- England Vacation Home Study, 1966, op. QLit., ational land subdivisions registered with HUD's' p. 7. office of Interstate Land Sales Registration. The usable response rate was 17 per cent. 64. Larry Tombaugh, "Factors Influencing Vacation Home Locations," Journal of Leisure Research, 77. U.S. Department of Commerce, Bureau of the Vol. 2, No. I (Winter, 1970), p. 56. Census, Second Homes in the United States, 2a- cit. 65. Aluminum Company of America, "Vacation Home Interest Among Tenants of New York City Apart- 78. Ibid. ments," (Pittsburgh: Unpublished survey con- ducted by the Company, 1966), p. 23. 79. U.S. Department of Commerce, Bureau of the Census, Second Homes in the United States, 66. Carolyn Feiss, Second Homes in Washington, cit.; and United States Department of Com- op. cit., P. 16. merce, Bureau of the Census, U.S. Census of Housing: 1970, General Housing Characteri6- 67. Building Products Guide, "From Dreams to Real- tics, United States Summary, (Washington: ities," (Los Altos, California: Hudson Publish- Government Printing Office, 1972), Final inq Company, 1972), n.p. Report HC (I)-Al, Table 4. 68. American Land Development Association, The 80. U.S. Department of Commerce, Bureau of the Land Industry Survey 1973, 2a. cit., anT 7Sur- Census, Second Homes in the United States, vey of Recreational Land Developers and Their op- E'L-t- Projects," Richard L. Ragatz and the Urban Land Institute, op. cit. The ALDA Survey Re- 81. "Survey of Builders, Dealers, and Manufac- ported 52 per ceii-t-; gie- ULI Survey 48.9 per turers of Vacation Homes," "Survey of Devel- cent. opers of Vacation Home Communities," and "Survey of NAHB Members Who Participate in the Vacation Home Market," (New York: Unpub- 69. "Survey of Recreational Land Developers and lished surveys conducted by Richard L. Ragatz, Their Projects," Richard L. Ragatz and the Ithaca, 1966), n.p. Urban Land Institute, 2E. cit. 82. U.S. Department of Commerce, Bureau of the 70. Interview with Ron Jones, Mobile Home Manufac- Census, Second Homes in the United States, turers' Association, Washington, D.C., July 9, cit- 1973. .83- Wisconsin Survey Research Laboratory, "Second 71. Unpublished survey conducted for this study by Home Survey," (Madison: University of Wiscon- the Opinion Research Corporation, Princeton, sin, Wisconsin Survey Research Laboratory, N.J., 2a. cit. 1971). 72. "Securities Aspects, Registration Requirements 84. Malcolm Bevins, "Seasonal Home ownership in of Resort Condos and Rental Pools Explained," Vermont," (Burlington: University of Vermont, Apartment Construction News, (April, 1973). Department of Agricultural Economics, 1972), p. 5. 73. U.S. Department of Housing and Urban Develop- ment, Office of Interstate Land Sales Regis- 85. John Borchert, Minnesota's Lakeshore: Re- tration, Unpublished material obtained from sources, Development, Policy Needs, (Minneapo- the files, June, 1973. This figure far under- lis: University of Minnesota, Department of estimates the true total since the South At- Geography, 1970), p. 20, and, Brian J. Thor- lantic states do not include data from Florida, sen, Rollin B. Cooper, Sydney D. Stanifoeth, and the Pacific states do not include data and Rudolph A. Christiansen, "Wisconsin Sec- from California. ond Home Ownership: Wisconsin Residents," (Madison: University of Wisconsin, Recreation 74. "Survey of Recreational Land Developers and Resources Center and Department of Agricultu- Their Projects," Richard L. Ragatz and the ral Economics, 1973), p. 15. Urban Land Institute, op. cit. 86. Brian J. Thorsen, et al., "Wisconsin Second 75. Stanley Works, "Survey of Dealers, Builders, Home Ownership," op. cit. and Manufacturers of Vacation Homes," (New Britain, Connecticut: Unpublished's@udy con- 87. U.S. Department of Interior, Bureau of Out- ducted by the company, 1965), n.p.' door Recreation, Northern New England Vaca- tion Home Study, 1966, op. cit., p. 3. 42 88. U.S. Department of Commerce, Bureau of the tration, Unpublished material obtained from Census, Second Homes in the United States, the files, June, 1973. pp-- cit- 105. American Land Development Association, The 89. David Mosena, "The Classification of Second Land Industry Survey, 1971, op. cit. Homes: A Proposed System Based on an Inven- tory and Selected Analysis of Second Homes 106. "Leisure Boom: Biggest Ever and Still Grow- in Sevier County, Tennessee," (Knoxvillet ing," U.S. News and World Report, op. cit. Unpublished master's thesis, University of Tennessee, Department of Urban Planning, 107. "Survey of Recreational Land Developers and 1971), p. 81. Their Projects," Richard L. Ragatz and the 9D. American society of Planning officials, Wa .ter- Urban Land Institute, op. cit. fronts: Planning for Resort and Residential 108. U.S. Department of Commerce, Bureau of the Uses, Planning Advisory Service information Census, Current Population Reports, (Washing- Report No. 118, January, 1959, p. 30. ton: Government Printing office, Annual), Series P-60. 9.1. Robert W. Wells, "Summer Cottage Bows to Year Around Home," The Milwaukee Journal, Thursday, 109. Philip 0. Bruce, "Financing the Great Escape," September 5, 1957. (Unpublished paper, The First National Bank of 92. office of Public Affairs, Dartmouth College, Atlanta, Georgia, April 1, 1973), p. 38. Vacation Home Survey for the Two Rivers Re- 110. Peter Henley, "The Quiet Revolution in Leisure gion, 1973-74, A Report funded by the U.S. Time," occupational Quarterly, (May, 1965), Department of Housing and Urban Development P. 6. under the Comprehensive Planning Assistance Program authorized by Section 701 of the Hous- 111. Geoffrey H. Moore and Janice Neipert HedgRs, ing Act of 1954. "Trends in Labor and Leisure," Monthly Labor Review, (February, 1971), p. 6. 93. William E. Shands, The Subdivision of Virginia's Mountains, (Washington: Central 112. Ibid., p. 5-6. Atlantic Environment Center, February, 1974), p. 32. 113. Riva Poor, Four Days, Forty Hours, (Cambridge, 94. American Society of Planning officials, "Sur- Massachusetts: Bursk Poor, 1970). vey of Recreational Land Development," 2E. q@it- 114. U.S. Department of Health, Education 95. Ibid. and Welfare; Public Health Service, Vital Statistics of the United States, (Washington.: 96. Interview with officials of the Del Web Corpor- Government Printing office, Annual). ation, Massanutten Development Company, Harri- sonburg, Virginia, April, 1973. 115. U.S. Department of Health, Education, and Welfare; Social Security Administration_ 97. "The Resort Puzzle," House and Home, Vol. 44, Social Security Bulletin, (Washington: Gov- No. 3, September 1973, p. 93. ernment Printing office, 1972); and, United States Securities and Exchange Commission, 98. Interview with Tom Shepstone, Director of Private Noninsured Pension Funds, (Washington: Planning, Wayne County Planning Commission, ernment Printing Office, 1971). Homesdale, Pennsylvania, March 1972. 116. U.S. Department of Transportation, Federal 99. William E. Schumacher, 1970 Non-Resident Land- Highway Administration, Highway Statistics, owner Study, Green County, New York, Project (Washington: Government.Printing Office, Leader, (Cairo, New York. Extension Center, Annual). July 15, 1971), p. 28 and 29. 117. University of Michigan, Survey Research Cen- 100. Vacation Rome Survey of the Two Rivers Region, ter, Survey of Consumer Finances, (Ann Arbor: 1973-74, op. cit-, p. 2- University of Michigan, 1972). 101. Raymond Burby, Household Decision Processes 118. Air Transport Association of America, Air in the Purchase and Use of Reservoir Recrea- Transport Facts and Figures (Washington: Air tion Land, (Chapel Hill: University of North Transport Association of America, Annual); Carolina, Water Resources Research Institute, and, United States Department of Transporta- 1971), p. 44. tion, Federal Aviation Administration, FAA Statistical Handbook of Aviation, (Washii-ngton: 102. Interview with Gary Terry, Executive Vice Government Printing office, Annual). President, American Land Development Associa- tion, Washington, D.C., July 10, 1973. 119. U.S. Department of the Interior, National Park Service, Public Use of the National 103. Eleanor Carruth, "The Corporate Move to Lei- Parks, (Washington: Government Printing sure Towns," Fortune (April, 1971), p. 74. Office, Annual). 104. U.S. Department of Housing and Urban Develop- 120. U.S. Department of Commerce, Bureau of Eco- ment, Office of Interstate Land Sales Regis- nomic Analysis, The National Income and Pro- 43 such as leaving as much of the natural vegative covered in adjacent lakes and streams and even cover undisturbed as possible, providing catchment neighboring wells. Regional hydrological changes basins for silt, and promptly seeding bare soil. can result from increased impervious surfaces in a Other construction activities, like building an project covering only a portion of the watershed. artificial lake or increasing impervious surfaces Cumulative Impacts. The cumulative effects of by paving roads, create lasting and unavoidable development should also be considered. Analyzing environmental changes which may affect the water- environmental impacts exclusively on a project-by- shed or permanently alter the hydrology of an project basis can obscure the cumulative effects area. many subdivisions can have on an entire region. Use Impacts-. The environmental impacts re- For instance, the environmental effects of recre- sulting from the use of recreational subdivisions ational subdivisions in Warren County, Virginia, must also be considered, even though they may not can onlybe determined by monitoring the combined all be readily apparent at the time a project is impacts of the 90 recreational subdivisions which propos@ed User impacts are more varied and spread have been developed there on the environmental re- out over more time than construction impacts. In sources of the whole region. general they are functions of project density and occupancy rates, the quality of project facilities, Unique Environmental Considerations the future maintenance of those facilities, and While the environmental impacts of recreational the quality of services such as solid waste col- subdivisions are very similar to those of conven- lection. For example, increased seepage from ag- tional first home subdivisions, there are several ing septic tanks in some second home developments characteristics unique to recreational land develop- has polluted adjacent lake waters. Elsewhere in- ments which have a direct bearing on their impacts creased hunting and fishing activities have re- such as their tendancy to have lower improvement duced wildlife and fish populations, and the accu- standards, their attraction to more sensitive natur- mulation of solid waste.in some second home areas al areas, and their slower buildout rates and sea- has also been a serious problem. Many of these sonal occupancy patterns. user impacts can be mitigated through proper Man- Lower Improvement Standards. Although recre- agement of recreation resources and the provision ational subdivisions appe ar similar to conventional of adequate public services. first home subdivisions, they are often constructed The scale and character of development also to significantly lower standards. For example, sep- has important implications for environmental im- tic tanks are widely considered inadequate for sew- pacts from use. A 20-unit condominium may have age disposal. The Community Builders Handbook, a less impact than 20 single-family units on the well known land development text, states: same site, but more than 10 single-family units. A public sanitary sewer system to serve the The environmental impacts of a 100-acre recreation- site is the best solution to the sewage dis- posal problem. . . . Only as a last resort al subdivision may be minor compared to a large should you ever consider an on-lot system scale project like ITT's Palm Coast, a recreation- which means individual septic tanks or cess- pools.3 al development with a projected population of And a U.S. Public Health Service publication sup- 750,000 located in Flagler County, Florida.2 ports'this advice: Off-Site Impacts. Most environment 'al effects Because they [septic tanks] frequently fail of development can be felt far beyond the bound- due to adverse soil conditions, with surfac- aries of projects themselves. In order.to get a ing of partly treated sewage, severe health hazards often result. . . . Even under the complete picture of the effects of development, off- most favorable conditions, some degree of site or "down stream" impacts must be taken into failure will be experienced. . . . Subdivi- sion regulations should generally prohibit consideration. For example, the end results of septic tanks.4 runoff and erosion are often,most critical down Yet over two-thirds of the recreational subdivisions stream where siltation occurs. Contamination of registered with OILSR list septic tanks as the only ground water from faulty septic systems can be dis- available means of sewage disposal. 46 Other substandard development practices in Specific Environmental Impacts recreational subdivisions increase the likelihood Individual cases of environmental damage re- of environmental problems. Water supplies fre- sulting from recreational land development are abun- quently come from individual, on-site wells shar- dant, but each one is the result of a combination of ing the lot with a septic tank. Roads are often various localized conditions as discussed above. private and developed to lower than public stan- Studies on the environmental impacts of development dards, increasing problems with erosion and silta- are therefore limited by the particular set of con- tion. straints of each situation. Recognizing these limi- Locations in Critical Environmental Areas. tations, this section surveys a range of the develop- The unique locations of many recreational subdivi- ment impacts which have occurred in different envi- sions--in remote areas of high natural beauty--in- ronmental settings around the country in order to crease the potential for environmental conflicts provide an overview of the different types of prob- between man and nature. Furthermore, a majority lems experienced by communities to date. Many of of the existing second homes in the country are these problems could have been avoided or minimized located on or near some body of water, increasing through improved development practices and local the potential for water pollution. In Virginia, land use controls. Others unavoidably resulted from the State Division of Planning has designated the decisions to permit development to occur in the Massanutten Mountain as a critical environmental first place. area, yet that unique natural feature is surround- Lo cal Water Supplies. Ensuring adequate water ed by more than 100 recreational subdivision s.5 supplies for recreational subdivisions can be a prob- . Urbanizing Influence of Recreational Subdivi- lem not on ly in arid regions, but also in temperate sions. The 3,900 recreational subdivisions sur- regions of the country. The case of Shenandoah veyed in OILSR's files averaged 1,000 acres each Shores, a recreational subdivision in Warren County, with average lot sizes of less than one acre. At Virginia, provides a good example.7 Begun in 1959 this scale and lot density, such developments can as a second home project which is gradually becoming amount to a form of substantial urbanization. In permanently occupied, Shenandoah Shores featured a most rural communities, one large or several central water system, which, as lot buyers later dis- smaller projects can account for more growth than covered, violated State Health Department regula- has occurred in the entire history of the area. tions. Finally condemned by the Health Department Flagler County, Florida, with a current population in 1968, the Shenandoah Shores water system was of 4,454, will be substantially urbanized by the taken over by the property owners' association and Palm Coast recreational development mentioned brought up to state standards. But problems con- earlier if the projected 1990 population of tinued. In 1968 two wells were sufficient to support 750,000 materializes. the system; today a third well is being drilled in In recreational areas relatively close to order to satisfy rising demands for water within the metropolitan regions (e.g., 50 miles), continued project as a result of increased buildout, the con- pressures for urban sprawl and outward migration version of second homes permanent occupancy, and can increase the urbanizing effects from recre- competition for available ground water from other ational subdivisions in rural areas, especially new developments in the region. One well which pro- as more industries and jobs move to the suburbs duced a continual flow of 60 gallons per minute in and the permanent occupancy of second homes be- 1968 today pumps dry in 18 hours; and because of in- comes more feasible. Officials of still rural adequate sewage treatment in the project the entire Warren County, Virginia foresee the urbanization water supply, which depends upon wells, now requires of that county as inevitable as more and more per- chlorination at the rate of 1/4 ounce per 1,000 gal- manent homes are constructed on recreational lots lons. In 1968 no such treatment was necessary. Lo- and second homes are converted to permanent use.6 cal officials now suggest that county water and sewer 47 service is the only long-run answer for Shenandoah depends on well fields for its water; wells which Shores and neighboring recreational subdivisions. in Hillsbourough and Pasco Counties are now showing In and regions of the West the problem of depressions in the water level of the Floridan aqui- adequate local water supplies is tougher, and has fer by as much as 15 feet. Pasco County adopted become a major consumer issue. Surface and related a resolution to limit withdrawals of water by out- subsurface water in the West is formally appropri- siders to 500,000 gallons a day. But at the likely ated by state governments and allocated to specific rate of 150 gallons per person per day, this amount users. Prior allocations or rights have legal pre- of water would only serve 3,333 people--0.5 per cedence over new demands. It is thus surprising cent of the 1973 population of Pinellas County that 100,000-acre ranches, considered marginal for (648,741). cattle due to a lack of water are now being subdivi- Faced with major water shortages, Pinellas ded into small homesites. As a result, many of the County has imposed a moratorium on building in order streams on the eastern slope of the Rockies are to have time to work out possible solutions. The already over-appropriated, and the Colorado state severity of the water shortage was not accepted by goveinment has begun to deny well permits to lot commercial interests such as the Pinellas County owners in at least one county.8 Contractors and Builders Association, which quickly Regional W12ter Supplies and Groundwater Re- announced its opposition to the building moratorium. sources. Second home developments can have major Nevertheless, home owners have been notified of a impacts on regional water resources as well. In surcharge for water use in excess of their previous some areas, such impacts are already severe, and the consumption, and persons applying for exemptions threat of future crisis looms in others. are faced with stiff penalties for supplying misin- The heavily developed area in Florida north formation. An unexpected side effect of all these of Tampa along the Gulf Coast is experiencing a actions has been an increase in advertising urging depression of the water level in local aquifers still more people to buy land in Pasco County, where as a result of excessive groundwater withdrawals.9 such restrictions on construction and water consump- The lowered surface in the aquifer reduced pres- tion do not exist. sures in public water systems, allowed saltwater Groundwater problems exist elsewhere than coast- intrusion, and forced communities to declare build- al areas. For example, groundwater "mining" is com- ing moratoriums. These problems are further aggra- mon in the Southwest. Water levels in the Ogalla vated by the construction of so-called "Venetian formation in eastern New Mexico have been declining Canals." Designed to provide lot owners with boat since the 1940s. There the leisure industry in access to bay and ocean, these canals bring salt- general and second homes in particular have contri- water far inland, and often introduce it directly buted much to such situations by using large amounts into the aquifer.10 of water to maintain golf courses and lawns.11 Saltwater encroachment into Tampa and St. Regional water problems created by recreational Petersburg well fields as much as 40 years ago development in the Rocky Mountains are particularly forced those communities to import water from other complex. In most areas, all surface waters were long areas which are now hard pressed to supply their ago legally appropriated for agricultural, commer- own local needs. As a result of recent retirement cial, and community use, with nothing left over to and second home development in Pasco County', Florida support additional residential development. Since saltwater chlorides have intruded inland, sometimes the well fields of new subdivisions borrow from as much as several miles. The U.S. Public Health springs and other contributors to surface flow, Service recommends that chlorides not exceed 250 someone downstream suffers the loss of allocated milligrams per liter (mg/L) in public water supplies, water. Conflicts between second home and agricul- yet that concentration now exists in some deep, in- tural water needs in New Mexico have led to near land wells and increases to 16,000 mg/L only 100 violence along Fernando de Taos Creek and to tighter feet from shore. state controls over water allocations in the Hondo Pinellas County, further along this coast, also and Rio Grande River Basins.1 12 To avoid physical or 48 legal confrontations, developers may now purchase 25 per cent of the wells tested in Jefferson County existing rights, usually from agricultural hold- show pollution from improperly treated sewage; in ings, and convert them to domestic use, thus threat- this case nitrate readings run close to 40 mg/L ening a basic shift in local economies without any (the maximum safe level for a human baby) and there public determination that such shifts are desirable. are high coliform counts as well.14 High bacteria Water Quality. Poorly engineered septic fields counts have been recorded for two years from a 1300 in recreational subdivisions have harmed the quali- foot well (1200 feet of which is cased) in Orange ty of both ground and surface water resources. Evi- County, Florida.15 Potential problems of this sort dence is scattered nationwide, ranging from the are extremely widespread since two-thirds of all Virginia case of Shenandoah Shores cited earlier to recreational subdivisions use septic tanks for sew- occurrences of "yellow snow" at a Taos County, New age disposal. Mexico ski development as a result of sewage seeps Except for sediment loading, the impact of from condominiums and lodges on the mountainside.13 second homes on the quality of flowing streams is The State Engineer's Office in Colorado reports that v 7, 7@ A, -S e 4 4 - el@ "T J F ik Road construction in recreational subdivisions is a common cause of environmental problems. Steep grades and vertical cuts in this project invite heavy erosion. 49 difficult to define because of the variety and dis- Erosion from leisure developments during con- tribution of other potential pollution sources. struction phases is another major contributor to But there are reports such as the case of a once water quality problems and is compounded by storm intermittent stream on Virginia's Massanutten Moun- water runoff. The usual result of such pollution tain that is now flowing full time with septic field in both natural and artificial lakes is the rapid effluent from a second home complex.16 accumulation of silt and sometimes septic muck on Along the Florida coastal area discussed above, the lake bottom. Such siltation along with accel- second home developments have clearly had an impact erated eutrophication of the lake is the result of on water quality. Sewage effluent from plants in mineral or nutrient enrichment of the lake water varying stages of treatment is often discharged into which accelerates plant growth and can turn the streams, lakes, bays, lagoons, canals, or other slow- lake into a swamp. moving bodies of surface water. These waters become Artificial Lake Developments. Many second overenriched, resulting in rampant growth of water home developments include man-made impoundments de- weeds, fish kills, algal blooms, foul odors, dark signed for fishing, water sports, and scenic effects. coloration, destruction of native wetland plants, Such artificial lakes are easily polluted and should reduction of desirable wildlife, and a shift to less be constructed and managed with special care. Ac- desirable or "trash" species. Less obvious is the cording to the U.S. Geological Survey, "real estate accumulation of organic debris ("crud") from sewage lakes, because of their nature and manner of crea- discharge, and the high counts of bacteria that may tion, are more susceptible to eutrophication than themselves be dangerous to people, fish and other are most natural lakes."20 The size of the water- wildlife. shed is a crucial factor in providing a cleansing A test of water quality at 80 private home water flow necessary for a healthy lake environment. sites on 41 water bodies in West Florida was spon- Many artificial lakes with limited watersheds turn sored by the Environmental Information Center and out to be too small to absorb the effects of adja- conducted by the University of South Florida. In cent land development such as siltation from runoff addition to testing for coliform, samples taken near and erosion. A North Carolina study determined that the bottom were tested for Clostridium perfringens the watershed must be at least five times the area (or C. Welchii), a causative agent for gas gangrene. of the lake itself, with the ratio rising to 20:1 Both coliform and C. perfringens are indicators of in the Virginia Piedmont, and probably climbing much fecal contamination. High counts of both organisms, higher in less humid areas.21 substantially exceeding the maximum permissible under Sedimentation resulting from construction and state and county health and water pollution laws, shore erosion causes widespread problems for arti- were found in the large majority of cases. Accord- ficial lakes. Accordingly, the U.S. Geological ing to the study director, many of the bodies of Survey recommends that all grading for roads, sewers, water sampled could cause epidemics of various sew- and utilities be done prior to construction of proj- age-derived diseases . were they not so repulsive to ect lakes, that buffer zones of natural vegetation potential boaters and swimmers.17 at least 50 feet wide be left along all contributing Inadequate sewage treatment by septic systems streams, and that some degree of control be sought almost invariably degrades lakes, particularly in over other developments in the lakeshed. In short, areas of high density and where second homes are careful site selection is not enough for such lakes; being converted to permanent residences. A 1968 thorough and continued management is essential.22 study, for example, showed that 125 defective dis- The environmental hazards that artificial posal facilities contributed as much phosphorus to. lakes can present are exemplified by the case of Mine Cormorant Lake, Minnesota, as came from natural Run, a recreational subdivision in Warren County, sources.18 And the effects of septic tank leeching Virginia, in the Massanutten Mountain-Blue Ridge over 10 years changed Cochran Lake in northern Wis- area.23 The developers of the subdivision construc- consin from a pristine lake to a "300-acre algal ed three earthen dams across Mine Run Creek to create pond."19 a series of recreation lakes for residents of the 50 subdivision. mine Run Creek, at its point of dis- roads; tire worn depressions turned into small charge into the uppermost reservoir, was already watercourses, and small creeks into which the run- darkly silted, and each of the reservoirs had small off was discharged were discolored by eroded soil. but well formed deltas just below the point of the Elsewhere in the Massanutten Mountain-Blue Creek's discharge. Ridge area, ski slopes also present considerable po- The erosion of the land and siltation of Mine tential for erosion and aggravation of stream sil- Run Creek was further aggravated by irresponsible tation. Several ski runs showed evidence of severe development practices. The area cleared when the erosion when visited by the research team, and reservoirs were constructed, was still bare when officials at one ski resort said that they had re- observed during field surveys in 1973, and slopes seeded their slopes three times.30 Under even the around the reservoirs showed evidence of gullying, best conditions, mountain areas with steep slopes with the loosened earth washed directly into the and thin soil are prone to relatively high storm reservoirs. moreover, the three dams had not been water runoff. According to a report of the Lord properly maintained. Storm water washed out a Fairfax Planning District Commission (LFPDC), run- large portion of one of the dams so that the water off "exceeds 25 per cent of the total rainfall in cut a gorge through the easily erodible earth im- some areas.,,31 According to the District Water poundment, further aggravating the siltation of the Management Plan, this situation is primarily due to Creek. A Forest Service District Ranger reported a combination of "steep and irregular terrain cou- that the siltation of Mine Run destroyed what was pled with a comparatively shallow soil cover." once one of the best natural trout streams in the Construction on poor soils is also a serious region.24 problem in the Rocky Mountains. Slide areas, swell- Erosion, Siltation, and Landslides. Erosion ing clays, gypsum shales, joint systems, bedding is a major problem common to recreational subdivi- planes, and runoff areas all prove unhappy building sions, especially resulting from improperly located sites for unwary consumers , and construction thereon and poorly constructed roads. For example, at Lake threatens oblivion to downhill or downstream neigh- Tahoe, California, erosion from subdivision roads, bors., In one New Mexico development, 58 per cent of which ranges from 40 to 165 cubic yards per mile, 60,000 acres platted for subdivision exhibit severe accounts for 48-per cent of the sediment entering limitations for low building foundations, roads, and the lake, the greatest single source.25 In Nevada septic fields as well as being poorly suited for County, California, 160 miles of streams, which lawns and gardens.32 During the period from July, comprise 37 per cent of the County's total stream 1972 to April, 1973, 43 per cent of subdivisions re- milage have been damaged by siltation, stream bank viewed by the Colorado Geological Survey had plans alterations, and domestic waste from recreational inconsistent with geological conditions. A proper subdivisions.26 Sediment from second home devel- site analysis would cost only seven dollars per lot opments even shows up in satellite photographs of buyer, "probably less than a home owner would spend the marine waters along the west coast of Florida.27 on his mail box."33 Development can significantly increase sedi- At the extreme end of the erosion spectrum are mentati on rates. The sediment loading of Lake those second home developments whose poorly planned Barcroft in Virginia rose from 19 to 75 cubic feet road systems divert water out of natural drainage per acre per year during the urbanization of its courses and undermine the ability of slopes to sup- watershed.28 California estimates that erosion port themselves, thereby accelerating the natural during. construction is 10 times that derived from process of land slippage. Some large recreational cultivated land, 200 times that from pasture, and developments are located in actual landslide, mud- 2,000 times that from forest land.29 flow and alluvial fan areas, with individual cabins The Mine Run project further illustrates and condominiums constructed in known avalanche these points. Twice during the course of this chutes and rockfall zones. For example, geologists study, conditions in the subdivision were observed foresee major structural damage and loss of life in during moder ately heavy rainstorms which produced the event of major earthquakes in the Lake Tahoe excessive runoff. Rivulets cut deeply into the region.34 51 One of the better documented cases of land road network creates an impervious surface, as do slippage is that of the Marble Ski Area on Mount the large packed-earth parking lots sufficient to Daly, Gunnison County, Colorado.35 In June of accommodate 700 cars. Construction of a reservoir 1972, after a detailed site investigation, the to store and provide water for snow-making equip- Colorado Geological Survey warned County officials ment may serve as a retention facility for storm that the proposed development--including some water, but without measures to contain and retain 8,000 condominium units--was in an area of docu- flows through nearby Harshberger Gap, there could mented landslides and mudflows. Nevertheless, be extensive alteration of the hydrologic charac- County officials approved the project and construc- teristics in the streams flowing from the Kettle. tion began. The first landslide resulting from This potential change may be similar to the in- road construction occurred on May 14, 1973. Six creased water runoff in a small watershed which days later, according to Rocky Mountain News, "Tons drains another large subdivision in the Blue Ridge. of waterladen silt, rocks, trees and other debris There, the increased runoff, which backs up behind roared down Carbonate Creek Sunday afternoon into a small gap through which the stream flows, has re- the town of Marble." By late July, the Colorado sulted in an increase in the boundaries of the 50- Land Use Commission was calling the Marble Ski year floodplain.39 Area a "major hazard to public safety." Second home development along creek and river Hydrology and Floodplains-. Road pavement and floodplains is widespread, and periodic flooding roof. tops in recreational projects increase the im- seems almost an accepted event by some owners. To permeability of watersheds, and can cause major date, the problem has been treated largely as a con- hydrologic changes in the timing and volume of sumer issue. Questions should be raised, however, stream flow in fragile headwater areas. Increased regarding the extent to which public expenditures impermeability results in greater variations in may be required in the future for protecting second flows with more floods during heavy rainfalls, home developments from flood damage, as well as the smaller volumes during droughts,and shorter elapsed preemption of potential reservoir sites by develop- times between rainfalls and peak flows. ment in floodplain areas. In mountain subdivisions around Lake Tahoe, Estuaries and Shorelines. The impact of second one out of every six acres is often occupied by home development on coastal areas has been massive. roads and structures. As a result, normal peak Some major estuarine resources have been nearly de- runoffs from heavy rainstorms have increased two or stroyed by development such as the destruction of three times, leading to bank erosion, channel scour- 25 per cent or 9,000 acres of Ocean County, New ing, and loss of fish habitat in affected streams.36 Jersey's 36,000 acres of wetlands.40 Though buildout is low at Apple Mountain subdivision A report made for Florida's governor and execu- in Warren County, Virginia, there has been a mea- tive cabinet on the environmental effects of recre- surable increase in flood frequency along a small ational canals along coastlines and estuaries listed drainage area where water backs up behind a natural many types of environmental injury: constriction in the stream valley.37 The practice of developing waterfront prop- Elsewhere in the Massanutten Mountain-Blue erty by excavating artificial canals causes environmental degradation which reaches be- Ridge area of Virginia, the construction of one yond the boundaries of the immediately devel- resort development will produce vastly increased oped property and therefore affects the pub- lic interest. water runoff due to extensive alteration of the landscape. The first stages of development are The almost universal characteristic of these deep, narrow box-cut canals and dead-end con- taking place in a large, forested bowl called "the figurations is sluggish circulation and a Kettle." Although the developers are rightfully lack of flushing action, compounded by insuf- ficient tidal exchange or a lack of adequate proud of their decision to leave 57 per cent of the gravity flow due to flat terrain. land in undisturbed open space, large forest areas The lack of water exchange characteristic have been cleared and converted into ski slopes.38 of these canals leads to an accumulation of A large golf course is also planned. The extensive oxygen-demanding and toxic sediments and organic wastes, causing low dissolved oxygen, 52 objectionable odors, floating sludge, fish tion of new sand for shoreline and beach. However, kills and anaerobic and.septic conditions. construction of barrier dunes, breakwaters, and Eutrophication of limited-circulation bulkheads diverts wave energies along the shore canals is greatly accelerated by a heavy rather than inland, preventing deposition of sand pollution load due to the increased population density in relation to shore- and creating long-shore currents which erode both line length. The sources of pollution beach and shoreline, as seen at Miami Beach and the include urban runoff, septic tanks, sew- age effluent and live-aboard houseboats. North Carolina Outer Banks. In fresh water canals, these adv erse effects A particular shoreline problem along Atlantic are compounded by heavy infestations of coastal areas is posed by hurricanes, whose tidal aquatic weeds, the application of herbicides waves and floods generally cause more damage than and the addition of decaying vegetation to the accumulation.of oxygen-demanding bottom their winds. The Florida Gulf coast north of Tampa sediments. is especially susceptible to. hurricanes, and much of These conditions produce waterways with a the second home development between the coastal high- paucity, or a complete absence, of desir- able fish and aquatic life and which event- 'way and the shoreline is only three'to five feet ually become so contaminated that they are above sea level. Pinellas County has initiated unsafe for body contact. This investiga- flood zoning in an attempt to control development tion shows that the water in most of Florida's canals cannot meet federal and state water in flood-prone areas so as to qualify for protection quality standards, and canal characteris- under the National Flood Insurance Program. Adja- tics may make it impossible for these water- ways ever to achieve these minimum legal cent Pasco County has rejected such flood zoning, standards. even though almost all of its newest coastal devel- Many of these canals are deep incisions into opment lies within the hurricane flood zone.44 the aquifer and threaten underground water The fact that the new second home developments supplies either by lowering the water table through drainage, or by the flow of con- in this low-lying coastal area have so far escaped taminated canal water into the aquifer. hurricane damages unfortunately encourages complac- The contaminated condition of labyrinthine ency. The manager of one project observed, "I've canal systems presents a health hazard to been here for 15 years, and we haven't had a single both animals and humans, threatens the quality of receiving waters, and creates bad hurricane in all that time." But a planner costly problems in maintenance for both from the Pasco County Planning Department warned: individual property owners and public agencies. "It's not a matter of 'if'. It's simply a The consensus of contributors to this in- matter of 'when.' People think the so-called 50 or vestigation is that the present trend 100-year storm won't come for 50 or 100 years, but toward proliferation of canal-type devel- it'could happen next week. When we have a major opments, if continued unabated, will lead to an environmental disaster for Florida hurricane in western Pasco County it will be citizens.41 a tragedy."45 A similar study by the Virginia Institute of Air Quality. Disturbance of natural terrain marine sciences of a proposed development on the can lessen local or regional air quality by creat- waterfront in Virginia's Stafford County concluded ing dust during and beyond the r@anstruction phase that canals along Aquia Creek, a fish spawning and of a project. In New Mexico, in June, 1973, the nursery area, could only be harmed by "increased state Air Quality Control Board officially ordered pollution loads and boat traffic. . . .,,42 Horizon Corporation, a major recreational land de- Recreational land development can have other veloper, to prevent sand and dust from blowing off impacts on the land water interface than filling subdivision roads. Some lots in the development in, pollution, and depopulation of estuarine and were reported covered with as much as one and one- marsh life. Development of the shoreline by bulk- half feet of sand. New Mexico officials esti- heading, dune destruction, and replacement of mate that such subdivision roads are the source of natural dune systems with man-made "barrier dunes" 700 million tons of blowing dust per year--enough often contributes heavily to shore erosion.43 In to "cover Albuquerque one foot deep."46 their natural state, storm over-wash and the cush- Air quality can also be damaged by exhaust from ioning effect of marsh areas provide for deposi- increased automobile traffic in second home areas. 53 222-B78 0 - 77 - 5 These problems are especially likely in mountain- fish and wildlife populations as a result of their ous regions where temperature inversions are com- angling and hunting activities. Severe impact is mon, such as in the Blue River Basin of Summit possible, at least locally. Other impacts may be County, Colorado where heavy increases in air more subtle, such as forced changes in daily routines pollution are expected from automobile exhaust or migration patterns of certain species. To date, emissions and wood-burning fireplaces during peak little special concern has been expressed about the recreat ional weekends.47 impacts of second home developments on endangered Solid Waste. Many officials interviewed dur- species of fish and wildlife. In the Lake Tahoe ing this study commented on the solid waste prob- region, for example, 13 wildlife species are on an lems caused by second home development. U.S. "undetermined," "rare," or "endangered" status.51 Forest Service officials in Virginia report the Almost all of them are highly intolerant of man's diversion of personnel, time, and equipment from activities. Some face extremely intensive threats. normal duties to roadside clean-up along routes The Anthony Green Heron depends almost entirely on leading to second home areas.48 An official of shore1ine habitat; which is being rapidly urbanized. the New Mexico Environmental improvement Agency The Tampa Bay Regional Planning Council has identi- says that increased line items for solid waste fied wildlife species of rare, endangered, peripher- control in county budgets were a stark indication al, and undetermined status in the Florida counties of the problems faced by second home areas.49 within its jurisdiction, but no program has been Fish and Wildlife. As natural environments suggested to protect key habitat areas from modifi- are replaced with recreational subdivisions, fish cation by second home developments.52 and wildlife populations change accordingly, some@ Critical Environmental Areas. Much recreational times for the better and sometimes for the worse, land development is attracted to areas lacking the depending on one's point of view. On the positive natural capacity to sustain intensive development,or side, it is worth noting that creeks capable of areas which would better serve the needs of society supporting only minimal aquatic life can be turned if left in their natural state. into substantial bass lakes suitable for recre- A study undertaken by Florida's Tampa Bay Re- ational.fishing, and that forest clearings and gional Planning Council concluded that recreational shrub plantings may even attract, at least in the development there was attracted to the most fragile short run, more deer and other wildlife by increas- natural environments, and avoided lands most suited ing food supplies. for urbanization.53 Consequently the Council has On the other hand, habitat destruction and de- classified county lands by recommended uses. Some creasing fish or wildlife populations may be ex- highly fragile or critical lands are classified pected over the long term , as recreational devel- "preservation" where it is of prime importance to opment and occupancy.intensify. These effects retain the character of the region by leaving them may extend beyond the boundaries of projects them- in their natural.state. The category "conservation" selves. For instance, the Virginia Water Control covers fragile lands that are to be developed care- Board warns of probable State Health Department fully, if at all. A third category is termed "suit- action to close oyster beds to harvest--an issue able for development." Though most lands in the of major importance to commercial interests on the Council's region fall into the third category, many Virginia coast. Along Big Grizzly Creek in Plumas resource conflicts exist where inappropriate devel- County, California, developers of Crocker Mountain opment occurs on prepervation or conservation lands. Estates had just completed extensive clearing of The Council states: roads and lots when the whole area was hit by a Almost 179,000 acres of preservation land major storm in August, 1967, silting stream hot- areas are left in the region and much of this area is currently in peril. Over toms and reducing aquatic life by an estimated 709,000 acres of conservation land areas 80 per cent.50 exist in the region and vast stretches of this land face development pressures today. Studies are lacking and informed opinion varies Over 108,000 acres of land resources cur- greatly on the effects second home owners have on rently are developed in a manner which re- sults in resource conflicts. The antici- 54 AM ifx, 41@ rAo,:, Special care must be taken to protect groundwater quality,in fragile environmental areas, such as along these coastal sand dunes. pated growth of the region will convert from the mangrove areas in the region indicates 16,000 to 22,000 acres each year into urban a reduction in forestation estimated at close use. Although almost 1,200,000 acres of to 50 percent in the coming decade. . . . land are vacant that are suitable for devel- Freshwater swamps in the region still face opment without special restriction, the de- the peril of destruction from land develop- velopmeift conflicts will continue to increase ment. . . . The benefits to man from preser- at a rate of 12.1 percent per annum, or about vation of these [swamp] areas relate to water six acres out of every ten that are developed supply protection, the sport fishing and hunt- will generate resource conflicts.54 ing industry, and the unique aesthetic values In the Tampa Bay region 60 per cent of urban of the areas . . . . The hurricane flood zone is undergoing the majority of intensive land development will be in the wrong place environmen- use changes throughout this region. The tally, while land highly suitable for development critical nature of development in this zone is reflected in the fact that it represents will be ignored, according to the Council. Preser- only 10 percent of the region but a majority vation conflict areas, where development has de- of new construction.55 spoiled natural areas deemed most useful when undis- The Florida critical areas are considered so valu- turbed, already account for 4,194 acres of the Tampa able and fragile that the Florida Coastal Coordinat- Bay region, and this acreage was expected to almost ing Council has.recommended that all coastal marshes double between 1972 and 1975. Present "conservation be designated "preservation areas." In such areas conflicts" are predicted to increase by 33,682 acres no alteration should be undertaken unless proven to to a total of 144,099 acres during the same time. be in the overriding public interest. Unfortunately, Almost 60 per cent of land to be developed between even this measure may be insufficient since all ur- 1972 and 1975 was expected to involve proposed con- ban developments above the wetlands direct their un- servation or preservation lands. 'wanted storm runoff, domestic waste water and other The Regional Planning Council provides insight pollutants downhill into ad Ijacent coastal wetlands. as to what this means in practical terms: Aesthetics. Part of the concern over recreation- The existing mangrove areas in the region al land development is a reaction to the aesthetic support a significant sport fishing in- impact of development--the removal of vegetation and dustry as well as certain well-documented construction which blights or blocks scenic vistas, ecological functions. Anticipated use of 55 Roads carved into this mountainside recreational subdivision degrade the aesthetic quality of the environ- ment, as well as threaten to cause siltation of downhill streams. and the architectural quality of the housing it- for earlier use as pasturage. All the lots have self. Second home projects can destroy a marsh been sold, but not many homes have been built yet. vista, intrude on a skyline, or light up a moun- However, those few structures which do exist stand tainside that once loomed black against the night out starkly on the hillside--the traditional A- sky. Aesthetic impacts range from the "invasion" frames and other assorted prefabricated houses, of wilderness by development to what the Nantucket along with a few trailers. Though not densely de- Islanders simply call a "loss of charm" as small veloped, this subdivision has dramatically altered villages are transformed by growth and development. a serene Blue Ridge vista. No matter how well a second home project is planned, Likewise, the precipitous slopes of the north- engineered, constructed, and operated, its mere ex- west flank of the Massanutten in Shenandoah County, is.tence in a formerly primitive or wilderness area Virginia are dotted with second homes. The owners stirs strong emotions and reactions among many of those homes have a spectacular view across the people. Such changes are felt most by those who Shenandoah Valley. At the same time, the grand knew the area as it existed before development. sweep of this magnificent mountain has been broken Landscape architects and planners speak of the by their presence. "gateway effect"--the attractive framing of the entrance to an area as small as a yard or as large Impacts on Public Lands as an entire region which reflects the character Many recreational land developers are attracted of the place and its people. Both these kinds of to areas near public lands--state and national parks, effects are evident in Virginia's Massanutten forests, and wildlife management areas. These sites Mountain-Blue Ridge area. Warren County has shown are not only rich in natural amenities, but they little sensitivity to its.gateway, the entrance to have the added benefit of offering free recreational the county through the Blue Ridge's Manassas Gap on facilities and protected natural landscapes to rec- Route 55. Just to the north of Route 55 in Warren reational property owners. The subdivision of pri- County lies an extensive second home subdivision. vate property, however, on inholdings (scattered par- The land has been cleared, some of it by farmers cels of private land within the boundaries of nation- 56 al forests) and adjacent to public lands, creates ment. One study from a national forest in Arizona a number of major administrative and environmental mentions several of these problems: problems for public land managers. Too little consideration has been given to waste disposal by most of the subdivisions. One of the most serious effects of recreational Residents are routinely depositing garbage subdivisions on public lands is their interference in containers in picnic areas, making un- with public land acquisition programs. For example, authorized dumps on public land, or simply scattering their waste indiscriminately the U.S. Forest Service still has a land acquisi- along roadways . . . . Public recreation areas in the study area are extensively tion program in effect. But much of the land which used by residents to the exclusion of tran- they have slated for public acquisition into the sient recreationists . . . . The development of subdivisions reduces habitat and restricts national forest system is under competitive pres- movement of wildlife . . . . At some undeter- sure from recreational land developers who are mined density, the subdivision development will begin to directly or indirectly inter- usually willing to pay more for the land. fere with the various product and service Problems in the George Washington National For- outputs from the National Forests. The resi- dential growth will progressively create ob- est in northern Virginia illustrate those being ex- structions to, for example, the volume of perienced in many other parts of the country. 56 The timber harvested, the kind of recreation opportunity provided, or the quality of water Forest Service currently owns 934,847 acres in the produced.59 George Washington National Forest, but has a pur- Forest Service officials also cite other impacts chase boundary comprising more than 1.6 million on public lands caused by recreational land develop- acres within which it may acquire additional land ment.60 For example, existing public recreation- when funds are available.57 Funds are limited, al facilities are overburdened. Fire hazards are however, and there is intense competition for them increased by inexperienced second home owners burn- among various forest districts around the country. ing trash or campfires on dangerous days. Since Recreational land development pressures have made they are usually widely scattered throughout the land acquisition even more difficult for the George area, it is difficult to notify and educate second Washington National Forest. For example, the home owners about fire dangers. Private lands which Forest Service was attempting to purchase the Mas- once were open to the public for hunting and recre- sanutten Mountain Kettle at $90 an acre, a unique ation are posted by subdivision property owners, geological feature adjacent to the National Forest. shifting increased hunting and recreation pressures The owners, however, demanded twice the price, and onto public lands. Second home owners also strongly sold it to a recreational land developer. The land object to timber cutting and management practices on is now the site of the Massanutten Ski Resort and adjacent public lands. second home community. A ranger from the George Primitive Forest Service roads are subjected to Washington National Forest summarized the acquisi- increased traffic loads from recreational property tion problem as follows: owners. And in some cases, poorly surveyed lot lines Land values are soaring because of specula- in recreational subdivisions wander across national tion and [recreational subdivision] develop- forest boundaries, resulting in conflicts of owner- ment. It has become increasingly more dif- ficult to purchase lands planned for recre- ship and use.61 ation because of high prices and quick sales Requests for special permits granted for ease- to developers. Inholdings, whether suitable or unsuitable for development, are being ments to run power lines, water and sewer lines, ac- purchased or looked at for possible subdivi- cess roads, and ski trails across public lands are sions. Most of these tracts were planned for National Forest acquisition but it is particularly threatening. The Forest Service has nearly impossible to compete with developers. granted many such permits in the past, but they are Many inholdings are key tracts that, if sub- divided, change the whole character of the becoming increasingly controversial. Such things surrounding land for most forest uses.58 as power lines detract from the otherwise natural Public land managers face a host of other prob- setting of the forest, and other improvements such lems caused by adjacent recreational land develop- as roads seem to only encourage more development. 57 NOTES 1. Three separate studies were conducted for this 13. Ibid. chapter by the Conservation Foundation and two of its affiliates: (1) "The Urbanization of 14. Interview with Hal Simpson, op. cit. Rural America: A Report on the Environmental Impact of the Leisure Home Industry," an un- 15. William M. Partington, Jr., "Environmental published paper prepared by Robert T. Dennis, Impact of Leisure Home Development on a Sec- The Conservation Foundation, Washington, D.C., tion of the Florida Coast," op. cit. 1974; (2) The Subdivision of Virginia's moun- tains: The Environmental Impact of Recre- 16. Interview with Charles D. Huppuch, District ational Subdivisions in the Massanutten Moun- Ranger, U.S. Forest Service, George Washington tain-Blue Ridge Area, Virginia: A Survey and National Forest, April, 1973. Report, by William E. Shands, Published by the Central Atlantic Environment Center, Washing- 17. For further details, see William M. Parting- ton, D.C., 1974; and (3) "Environmental Impact ton, Jr., "Environmental Impact of Leisure of Leisure Home Development on a Section of Home Development on a Section of the Florida the Florida Gulf Coast," Unpublished paper Coast," op. cit. prepared by William M. Partington, Jr., Envi- ronmental Information Center of the Florida 18. John Borchert, Minnesota's Lakeshore: Re- Cons4rvation Foundation, Inc., Winter Park, sources, Development, Policy Needs (Minneap- Floridar 1973. olis: University of Minnesota, Department Of Geography, 1970). 2. Helen Privett Bird, "Environmental and Econom- ic Impact of Rapid Growth on a Rural Area: 19. Steven M. Born, and Douglas A. Yanggen, Ender- Palm Coast," Environmental Affairs II (Spring, standing Lakes and Lake Problems (Madison, 1972), p. 154. Wisconsin: Upper Great Lakes Regional Commis- sion, 1973). 3. The Urban Land Institute, The Community Build- ers Handbook (Washington: The Urban Land In- 20. David A. Rickert, and Andrew M. Spieker, Real- stitute, 1968), p. 46. Estate Lakes Geological Survey Circular 601-G. (Washington: U.S. Department of Interior, 4. U.S. Department of Health, Education and Wel- 1971). fare, Public Health Service, Environmental Health Planning (Washington: U.S. Government 21. James R. Wallace, The Effects of Land Use Printing Office, 1971), p. 125. Change on the Hydrology of an Urban Watershed (Georgia Institute of Technology, Atlanta, 5- William E. Shands, The Subdivision of Vir- Georgia: September, 1971). ginia's Mountains: The Environmental Impact of Recreational Subdivisions in the Massanut- 22. David A. Rickert, and Andrew M. Spieker. Real- ten Mountain-Blue Ridge Area, Virginia: A Estate Lakes, op. cit. Survey and Report, op. cit. 23. Personal inspection of the site by the authors, 6. Interview with Warren Duncan, Town Manager, May, 1973. Front Royal, Virginia, May, 1973. 24. Charles D. Huppuch, letter to study staff mem- 7. William E. Shands, The Subdivision of Vir- ber, October 16, 1973. ginia's Mountains: The Environmental Impact of Recreational Subdivisions in the Massanut- 25. Limnology and Water Quality of the Lake Tahoe ten Mountain-Blue Ridge Area, Virginia: A Region (South Lake Tahoe, California: Tahoe Survey and Report, op. cit. Regl3inal Planning Agency and U.S. Forest Ser- 8. Interview with Hal Simpson, Office of the vice, July, 1971). State Engineers, Denver, Colorado, August, 26. Environmental Impact of Urbanization on the 1973. Foothill and Mountainous Lands of California 9. William M. Partington, Jr., "Environmental Im- (Sacramento, California: Department of Con- pact of Leisure Home Development on a Section servation, State of California, November, 1971). of the Florida Coast," op. cit- 27. Photograph seen by study staff member in files 10. See Franklin C. Daiber, et.al. "Environmental of U.S. Geologic Survey, Tampa, Florida, May Impact of Dredge and Fill Operations in Tidal 8, 1973. Wetlands Upon Fisheries Biology in Delaware," (Newark, Delaware: College of Marine Studies 28. David A. Rickert, and Andrew M. Spieker. Real- and Department of Biological Sciences, Uni- Estate Lakes, op. cit. versity of Delaware, December, 1972). 29. Environmental Impact of Urbanization on the 11. Interview with John Wright, New Mexico Envi- Foothill and Mountainous Lands of California, ronmental Improvement Agency, Santa Fe, New op. cit. Mexico, August, 1973. 30. Interview with Kenneth H. Brown, administra- 12. Ibid. tive sales manager, Massanutten Ski Resort, Warren County, Virginia, May, 1973. 58 31. Lord Fairfax Planning District Commission, "In- 44. Tampa Bay Regional Planning Council, "Environ- ventory-[of] Water Resources," Comprehensive mental Assessment of Development Atlas " (Tampa, Water Management Plan--Draft (Front Royal Florida: Tampa Bay Regional Planning Council, Virginia: Lord Fairfax Planning District Com- December, 1972). mission, 1973), p. 8. 45. Interview with Timothy C. Varney, Senior Plan- 32. Interview with John Wright, a- @fi_t- ner, Pasco County Planning Department, Dade City, Florida, July, 1973.. 33. John W. Rold, private communication to Lake- wood City Council, Jefferson County Commis- 46. "Horizon Corp. Warned to Curb Sand," Albuquer sioners and Golden City Council, Colorado que Journal, June 14, 1973. Geological Survey, September 2, 1971. 47. Wilbert J. Ulman, Mountain Recreational Commun- 34. Geology and Geomorphology of the Lake Tahoe ities and Land Use: "The Summit County Experi- Region (South Lake Tahoe, California: Tahoe ence " (Denver: The Colorado Land Use Commis- Regional Planning Agency and U.S. Forest sion, 1974), p. 86. Service, September, 1971). 35. Fred Brown, "Panel Cites 'Dangers' in Marble 48. Interview with Charles D. Huppuch, op. cit. Plan," Denver Post, July 26, 1975; "Marble 49. Interview with John Wright, M- cit- Ski Area Study 'Insufficient' EPA Tells Forest Service," Denver Post, August 23f 1973; William 50. Environmental Impact of Urbanization on the P. Rogers and John W. Rold, "Engineering Geo- Foothill and Mountainous Lands of California, logic Factors of the Marble Area, Gunnison op. cit. County, Colorado" (Colorado Gelogical Survey, Department of Natural Resources, June, 1972); 51. Wildlife of the Lake Tahoe Region (South Lake Richard J. Schneider, "Ecology Unit Votes to Tahoe, California: Tahoe Regional Planning Sue Gunnison in Marble Action," Rocky Mo Agency, May, 1971). tain News, April 12, 1973; "Massive Mr. Daly Mudslide Destroys Part of Private Road," 52. "A Preliminary Investigation of the Use of the Rocky Mountain News, May 15, 1973; "Second Natural Resources in the Tampa Bay Region as Mudslide Hits Marble Area," Rocky Mountain a Basis for Future Development Policy" (St. News, May 22, 1973; "Marble Area Growth Impact Petersburg, Florida: Florida Coastal Coordi- Prediction Queried," Rocky Mountain News, nating Council, December, 1972). August 24, 1973; and Suzanne Weiss, "Marble Ski Project Termed Public Hazard," Rocky 53. Information in this section is taken from Tampa Mountain News, July 26, 1973. Bay Regional Council Staff, "Environmental Assessment of Development: A Preliminary In- 36. Geology and Geomorphology of the Lake Tahoe vestigation of the Use of the Natural Resources Region op. cit. in the Tampa Bay Region as a Basis for Future Development Policy" (St. Petersburg, Florida: 37. William E. Shands, The Subdivision of Vir.- Florida Coastal Coordinating Council, December, ginia's Mountains: The Environmental Impact 1972). of Recreational Subdivisions in the Massanut- ten Mountain-Blue Ridge Area, Virginia: A 54. Ibid. Survey and Report, op. cit. 55. Ibid. 38. Interview with Kenneth Brown, op. cit. 56. Interview with Charles D. Huppuch, August, 39. Interview and correspondence with Richard N. 1973. Rollason, Chairman, Warren County Planning Commission, Front Royal, Virginia, May, 1973. 57. U.S. Department of Agriculture, Forest Service, National Forest System, Areas as of June 30, 40. George H. Nieswand, Calvin W. Stillman, and 1974 (File 1380 [5400]), p. 25. Anthongy J. Esser, "Survey of Estuarine Site Development Lagoon Homeowners, Ocean County, 58. Charles D. Huppuch, "Impact from Summer Home New Jersey" (New Jersey Water Resources Re- Subdivision on National Forest Administration," search Institute, Rutgers University, July, Unpublished paper, 1973. 1973). 41. William Barada and William M. Partington, Jr., 59. James C. Thompson and Gordon 0. Lewis, "Rural "Report of Investigation of the Environmental Residential Development on Private Land in the Effects of Private Waterfront Canals" (Winter Mongollon Rim ,Area of Arizona" (Fort Collins, Park, Florida: Environmental Information Cen- Colorado: Rocky Mountain Forest and Range ,ter of the Florida Conservation Foundation, Experiment Station, 1973). Inc., February 1, 1972). 60. Interview with Charles D. Huppuch, October, 42. Virginia Institute of Marine Science, "Joint 1973. VIMS/VMRC Subaqueous Application Report, on Application No. VMRC 73-230 by Aquia Corpora- 61. See Ibid. and James C. Thompson and Gordon 0. tion," July 23, 1973. Lewis, "Rural Residential Development on Pri- 43. Robert Dolan, "Barrier Islands: Natural and - vate Land in the Mongollon Rim Area of Arizona," Controlled," Coastal Gemorpholog (State Uni- op. cit. versity of New York, 1973), pp. 263-278. 59 CHAPTER 4 ECONOMIC IMPACTS OF RECREATIONAL LAND DEVELOPMENT Recreational land development can have both economic uses; thus, economic opportunities may be positive and negative economic effects on local lost. communities. On the positive side, development can Improved second home developments and resort produce property tax surpluses under certain condi- communities generate substantially more tax dollars tions, increase retail trade, and generate new job and also require more public services. In the early opportunities during both project construction and years of development, as second homes are being operation phases. On the negative side, the costs built, revenues for property taxes tend to more than of providing public services such as water and sewer cover the costs of public services. As projects be- services, police and.fire protection, and road main- come fully developed, and if second homes are con- tenance and snow removal to recreational subdivi- verted to permanent homes, service costs may exceed sions-can result in fiscal deficits under certain revenues. conditions. Displacement of existing jobs may occur The Local Economy. Recreational land develop- as land uses change, and local residents may find ments can involve major expenditures for engineer- their paychecks buying less as the costs of land ing, site design, recreational facilities, housing and housing, public services, food, and fuel are construction, and other items. The extent to which driven up by increased demand. these expenditures are made in the local economy This chapter examines the two fundamental eco- depends upon the characteristics and diversity of nomic effects of recreational land development: its that economy and the policies of each developer. fiscal effects on local government (will the taxes For example, the local labor force may not be suffi- generated by the development cover the costs of pro- ciently large or skilled to handle major recreation- viding public services for that development, and al land.development projects. In the early years of( under what conditions?); and its effect on the local development at Lake Tahoe, for example, many of the economy, including employment, retail trade, pro- construction workers had to be brought in from other perty values, and housing costs.1 cities because they were not available in Tahoe it- self. Similarly, if local business cannot supply Assessing Economic Impacts developers with the construction materials and Development Characteristics. Several factors equipment they need, the developers must purchase contribute to the economic effects of any recre- them elsewhere. ational land development. one major factor is the Diversified, large-scale economies have the kind of development involved--its type, size, level greatest ability to capture development expenditures. of improvements, and so on. Unimproved recreational They also have a larger multiplier effect. This subdivisions which involve minimal second home con- means that each dollar spent directly for develop- struction generate relatively few tax dollars since ment purposes is also spent again for other pur- property taxes are based on the improvements made on poses; thus, its effect throughout the economy is each lot. They also result in little developer and multiplied. According to several studies, recre- consumer spending in the local economy. At the ational land development can have a multiplier rang- same time, subdivisions with little or no occupancy ing between 1 and 2.2 cost the local government little in the way of pub- The Local Government. Another factor which lic-services. one of the major costs may be the affects the economic impact of.development is the change in economic use of that property from agri- capacity of local governments to provide the neces- culture or forestry to residential use. Although sub- sary public facilities and services. The critical divisions are generally taxed at higher rates than question is whether existing facilities and services agricultural land, they also preclude alternative are adequate.to absorb the demands by new develop- 61 ment, and if not will new development generate the Cost-revenue analysis is still an evolving necessary capital to expand local facilities and technique, and an exact determination of net fiscal services? Does the sewer system have sufficient impacts is often difficult to make. However, much capacity to absorb new development? Will more can be learned by examining some of the direct costs schools have to be built? Will more teachers or and revenues which local governments have experienced policemen have to be hired? with recreational land development to-date. Deter- Local fiscal policies, such as tax rates, the mining secondary costs and benefits is even more types of taxes used, and the rates at which pro- difficult and is beyond the scope of this analysis. perty is assessed also play an important role. In The fiscal impacts of development vary signifi- some areas assessment practices have a bigger ef- cantly from one community to another. As a rule, a fect than anything else. Most local governments rural community with few government services and fa- increase assessments only slightly when land is cilities will face more serious fiscal impacts than subdivided, leaving the major jump in taxes for a larger, more developed community. This is espe- when the housing is built. In other communities, cially true for recreational land development in re- where second home developments are given higher mote rural areas where vital public services and assessments as soon as they are subdivided, the facilities are either inadequate or unavailable.3 fiscal effects will be much different. The use of These communities nay be forced to raise taxes, in- such techniques as homestead exemptions to shift crease user charges, or create special taxing dis- the tax burdens from permanent residents to season- tricts to cover the costs of providing services to al residents can also affect the tax impacts of second home owners. On the other hand, where there second home developments. is excess capacity in existing community facilities, Secondary Impacts. Secondary economic impacts local governments may only face increased operating of recreational land development are very difficult and maintenance costs in the early years until growth to quantify, but they should still be considered in outstrips existing capacities and new capital im- any comprehensive evaluation of development impacts. provements are required. Major recreational land developments can act as Costs of Facilities and Services. One side of catalysts for more growth. In some cases, major re- the fiscal impact equation involves costs: capital sort developments have attracted other less im- costs (for constructing a regional water or sewer proved recreational subdivisions to a community, system, new schools, or a new fire station), and which attempt to benefit from the market created by operating and maintenance costs. In the following the more visible and more widely publicized resort section, six major cost categories are examined: projects. New jobs created by second home develop- (1) utilities (including water and sewer services); ment have, in some cases, attracted significant (2) roads; (3) schools; (4) police and fire protec- numbers of service employees from outside local tion; (5) health and welfare services; and (6) gen- jurisdictions, thus straining public services and, eral government administration. facilities (especially schools) even more. Utilities-The most important utilities for local governments to consider are the water and sanitary sewage systems. Other utilities include Fiscal Impacts on Local Government gas, electricity, and telephone service, but these The fiscal impacts of recreational land devel- aregenerally provided by public utility companies opment involve the costs of providing public ser- to individual property owners, and are not usually vices to developments versus the tax revenues gen- a burden to local government. Water and sewer ser- erated by those developments. The most important vices are the major concern. Less than 10 per cent consideration for local government is the net irn- of all recreational subdivisions registered with pact: do tax revenues cover the costs? The two OILSR contained or had access to Public sewage dis- major issues are: what services do recreational posal systems. Most recreational subdivisions land developments require, and how do costs and rely on private wells or community water systems revenues vary over time according to project char- run by a Property owners' association, with individ- acteristics and local governmentcapabilities? ual septic tanks for sewage disposal. 62 Even these privately built and supported facil- recreational subdivisions in Pike County, Pennsyl- ities may impose costs on the locality. New Mex- vania used septic tanks, the state Soil and Water ico currently has only enough water within the Conservation Commission claimed that soils in the state to support a population of 850,000 people area were generally unsuitable for septic tank use.7 without diverting water from existing farming and A study in Larimer County, Colorado, found that 64 industrial uses or buying water rights outside the per cent of the wells in one second home develop- state (the current population of New Mexico is ment were polluted by human waste.8 Five counties over one million and the state is buying water from in Northern Georgia, where considerable recreational Arizona).4 However, there are already enough sub- subdivision has occurred, operate no public sewage divided recreational lots in New Mexico to triple systems and have no plans to build any.9 the present population, if they are fully devel- A study conducted in rural Colorado found that oped. To date, the policy of some local govern- after the subdivision of over 5,000 recreational ments in New Mexico has been to refuse water ser- lots in Summit County, demands for sewer services vices to new developments. The Albuquerque City had outstripped the resources of the local tax base Commission'recently voted to deny water line ex- to finance them.10 Outside financial assistance tensions to subdivisions outside the city limits.5 was sought, but there were problems with that, too: While such an action saves local governments the "Repeated grant requests to finance a growing number co3--s of providing services in the short run, it of plants in an area where water quality is thought may not be a practical long run policy. As recre- to be degenerating has prompted the EPA to curtail ational property owners move into the state and additional grants pending proof of regional plan- become a stronger political force, such measures ning."ll In short, the major fiscal costs of pro- may no longer be politically acceptable. viding adequate water and sewer services to recre- Local governments will get by with few or no ational subdivisions have yet to be faced by many costs for water supply and sewage disposal systems host communities. as long as private systems function properly. Of- While water and sewer services are the major ten, however, it is only a matter of time before utilities of concern to local government, others failures occur and community health is threatened. should also be mentioned. The costs of installing new systems in many of Electricity is usually provided by public util- these developments may exceed the ability of many ities, and directly charged to the users. This is second home owners to pay, and local government not always the case, however. In the rural areas of will be forced to step in with subsidies from the Lassen County, California, electricity is provided general tax base. by a rural electrical cooperative which operates One second home subdivision in Warren County, under federal guidelines obligating it to provide Virginia, had a "central water system" installed power to anyone in the county. Officials of the by the developer. It was not, however, constructed utility company fear that if scattered recreational to state standards, and was condemned by the state development continues, it will go bankrupt.12 health department in 1968. It was then taken over by Although not a utility as such, solid waste the property owners' association and brought up to disposal imposes costs on local governments. Costs state standards. The chairman of the county plan- of collection and disposal facilities (usually coun- ning commission felt that it was only a matter of ty-run sanitary land fills) must be considered. time until the county would have to supply water Urban households produce almost twice as much solid and sewer services to the project.6 waste as rural households.13 According to officials The lack of adequate sewage treatment facili- in Hall County, Georgia, urban households continue ties is one of the most serious problems associ- to produce more solid waste than rural households ated with recreational subdivisions. Many rural even when they visit their second homes.14 governments have approved high-density recreational The cost of collecting solid waste from second land developments whose only means of sewage dis- homes is usually higher than for permanent homes, posal are septic tanks.. While 89 per cent of the partly because of the remote locations of the proj- 63 ects, but more often because of the seasonal vari- The costs of initial road construction within proj- ations in service demands created by second home ects are paid by developers. However, where there use. A report prepared by the U.S. Environmental are inadequate or nonexistent subdivision regula- Protection Agency found that ". . . the over-all tions, these roads are often minimal and substan- system cost per unit is much higher in recreation dard. In unimproved recreational subdivisions, they areas than in high population centers where con- are frequently nothing more than dirt roads, the tinuous use reduces expenditures."15 Local govern- purpose of which is to provide access to new lot ments must increase staff and equipment during sites for salesmen and customers. periods of peak occupancy in second home areas, There are two major reasons for inadequate either within their own systems or by contracting roads in recreational subdivisions. First, in many with private collection companies. A study of rural areas road standards were designed for very towns in the Adirondack Mountains of New York low densities, rather than the higher densities of stated that "In almost all Adirondack towns it has recreational subdivisions. Second, and even more been necessary to provide extra sanitary landfill common, most of the roads in recreational subdivi- hours because of the presence of leisure homes."16 sions are private roads which are not dedicated to Roads-Roads are one of the largest expenses local governments for maintenance. In only 18.2 per which local governments face in conjunction with cent of the recreational subdivisions registered recreational land development. In Deschutes County, with OILSR were on-site roads dedicated to local gov- Oregon, for example, the largest direct governmen- ernments. Most rural governments apply relaxed con- tal expense incurred as a result of recreational struction and right-of-way standards to private roads, land development was for road maintenance-17 Both thus allowing developers to make the least possible on-site and off-site roads should be considered. investment in roads. WS" 0 The remote locations of some second home developments can increase the costs of providing public services. 64 Permitting developers to install private roads require that some town roads be upgraded from arte- to low standards may save local governments some rial streets to major collectors. maintenance costs in the short run, but may cost Schools.--To many local government officials, them more in the long run. When the financial the most attractive feature of second homes is that burdens of road maintenance become excessive, pro- they pay the same property taxes as any other per- perty owners turn to local governments for help. manent dwellings, but send few children to local And many local governments find it difficult to schools. This is generally true, although there refuse them, either politically or legally. In are some exceptions. For example, Lake Latonka, a Pennsylvania, for example, state law requires local 300-unit second home development in Mercer County, townships to accept road dedications unless they Pennsylvania, sent 66 school pupils to county 23 have an ordinance spelling out construction stan- schools in the fall of 1973. Recreational sub- dards, in which case the property owners along the divisions may increase school costs in two ways: road must bring the road up to local government directly, through the generation of school children standards before dedication will be accepted.18 from permanent residents living in the subdivision, But maintenance is only one problem resulting from and indirectly, by stimulating secondary population substandard roads. Insufficient right-of-way width growth in the community. is another more serious problem, since it requires School busing costs for permanent resident the purchase of new land, a major capital expense.19 school children in recreational subdivisions can rise Subdivision roads must be wide enough to accommodate out of all proportion to their numbers due to the re- emergency and other public service vehicles. mote locations of some projects. In Okanogan Coun- Roads in a recreational subdivision near the ty, Washington, the local school district spent city of Madera, California, were accepted into the $2,136 in 1972 to bus nine children from one recrea- county road system, but the cost of maintenance be- tional subdivision.24 An even more extreme case came prohibitive. They were then placed in a spe- occurred in Madera County, California: cial maintenance district, which assesses all the . . . a family moved into a mountain sub- costs of maintenance to the lot owners.20 division 10 miles from the nearest school. In the family, there were children ranging Off-site roads which provide access to recre- from grade school to high school. At 12 noon a bus delivered the grade school student ational subdivisions may also require substantial home and made the return trip empty. At government investment for maintenance and improve- 2:30 the junior high student was delivered home and the bus returned empty. At 3:30 ment. Many rural, county roads are not adequate to the high school student was delivered home meet the new traffic loads placed on them. In and the bus returned empty. This continued for almost two years and it was found that 1972, Okanogan County, Washington spent $5,004 main- the transportation cost to the county for taining an access road to a recreational subdivi- this one family amounted to $2,000 a year. On the other handr this family's share of sion which provided only $1,637 in taxes to the taxes to the county was $250.25 county road department and another $1,309 to the In most cases to date, recreational subdivi- county general fund. 21 Before the subdivision sions have generated more than enough tax dollars existed, the county spent only $85 per year to grade to pay for the expenses of educating their children. the road. In addition, the road is considered un- A study of second homes in Ludlow, Vermont, states: safe for new traffic loads by the county road engi- Second home development has no adverse neer, who estimates it will cost $125,000 to im- financing effect on the local school sys- tem over the immediate future. Instead, prove. Second home development in Ludlow, Vermont, second home development has the effect is creating traffic jams, especially on access of substantially increasing the tax base without any corresponding increase in the roads to a ski resort in the town.22 Second home pupil role of the school system. . . . 26 growth in Ludlow has also required the maintenance This subsidization of local school systems by second and plowing of roads which previously were not home owners may not continue forever. As second maintained in winter. And changes in Ludlow traf- homes are converted to permanent dwellings, school fic patterns due to second home development will enrollments can be expected to rise. The Ludlow 65 study reported that over 45 per cent of the second rollments, and in 1973 had to resort to a new sched- homes there were expected to convert to permanent uling system where school facilities are used on a residences in the next 10 years, doubling the local year-round basis. school enrollments. If this occurs, taxes from Police and Fire Protection.--Demands for in- second home owners would not be sufficient to cover creased police services depend on the size and occu- the increased costs of education. New classrooms pancy rates of recreational projects. The usual would have to be constructed, and transportation police protection offered by rural governments often expenses for busing would rise at greater than is strained by seasonal population fluctuations re- average rates due to the remote locations of many sulting from second homes. For instance, the size second homes. The Ludlow study also stated that of the Hall County, Georgia police force remains the quality of education offered would have to be constant throughout the year, even though the county upgraded due to the higher educational standards population more than doubles on summer weekends.30 expected to be demanded by second home owners from While minimum national standards suggest 1.4 police urban areas. officers per 1,000 inhabitants for an area with Hall These increased educational expenses resulting County's population, the county has only .63 offi- from the conversion of second homes to permanent cers per 1,000 permanent residen Its. This ratio homes have already occurred in some other areas. drops to .31 officers per 1,000 residents on peak Waitsfield, Vermont, is one example. summer weekends. In Waitsfield the school budget has more Generally, crime tends to increase with perma- than doubled in ten years, from $106,748 nent population growth. But second home areas pre- in 1961 to $253,274 in 1971, and during this time all five towns have had to sent some special problems. Sitting dark and empty build new schools, as part-time residepts much of the year, second homes are easy targets for became permanent residents.27 burglars, arsonists, and vandals. In Ludlow, Ver- Recreational land developments may also in- mont, police checks on second homes increased from crease school expenses indirectly by stimulating three in 1960 to 200 in 1972.31 Some vandalism oc- secondary population growth. The in-migration of curs during winter months when second homes are families seeking employment in service jobs gener- most often vacant. Yet one study reports that the ated by second home developments can result in in- most serious burglaries in second home areas occur creases in school enrollments. Where major second during the middle of the week in the summers, when home and resort community developments create a second home owners tend to leave more valuable items local economic boom, some communities have experi- in their homes.32 enced in-migration of job seekers and their fami- In Windham County, Vermont, police departments lies. The population of Pasco County, Florida in- are being created where none previously existed, due creased from 36,785 in 1960 to 107,750 in 1973. to recreational land development. Wilmington, Ver- Most of this increase was the result of retirees mont, which had no police department of its own five moving into the county, many of whom owned second years ago, now has three full-time policemen, five homes there.28 While retirees had no school-age to ten special officers (depending on the time of children themselves, they stimulated the growth of year), and a number of deputy sheriffs in addition service industries in the county. This, in turn, to assistance from the state police.33 Residents attracted younger job-seeking families to Pasco of Waitsfield, Vermont, said that the police force County, resulting in dramatic effects on t .he school had to be enlarged due to increased crime, drug system. Three per cent of the dwellings in one problems, and traffic congestion resulting from sec- 11,000-acre recreational development (almost sold ond home growth.34 For years the Ludlow, Vermont out) are occupied by full-time residents, many with police department consisted of one full-time police school-age children. This project alone could ne- chief. In 1964 a part-time officer was added for cessitate the construction of new schools. In 1972, weekends and summer months to help with traffic and a $15.9 million bond issue was passed to build complaints from the lake and mountain areas. In eight new schools in Pasco County.29 The school 1968, a full-time officer was assigned to patrol the system was caught unprepared for the growth in en- second home areas at night. The Ludlow study states: 66 The volume of complaints and traffic acci- as tax administration and collection, record keeping, dents continues to increase each year and licensing, inspection activities, and land use plan- becomes especially problematic on heavy tourist weekends when the town's popula- ning and zoning. Most of these are operating ex- tion grows to three or four times its normal size.35 penses, including staff salaries and equipment, but capital costs for new facilities may also be needed. Fire protection costs to local governments can also increase with the advent of second home devel- The worst situation occurs when a large recreational opment. In most rural areas, fire protection is subdivision is planned in a small rural community minimal and generally relies on volunteers. In with minimal staff and facilities to handle the in- many rural areas, no fire protection exists it all. creased operating needs of government. Of five counties containing recreational subdivi- The study of second home impacts on Ludlow, sions in Northern Georgia, none provided any fire Vermont reported the need for additional administra- protection.36 As second homes are constructed in tive staff assistants for the town manager, and a recreational subdivisions, demands for fire pro- full-time fire chief.40 New municipal accounting tection services can easily exceed existing capa- procedures were also necessarYr and the town charter bilfties. In Ludlow, Vermont, second homes built needed revision to modernize the form of local gov- on steep slopes are difficult for the town's anti- ernment. quated equipment to reach.37 High-rise condomini- Some of these governmental functions, such as ums present another unique fire protection problem tax collection and planning, are necessary whenever for some rural governments. In Summit County, land is being subdivided, regardless of whether it Colorado, military surplus fire trucks (which make becomes developed with second homes or not. Until UP the total inventory of the voluntary county fire recently, Grand County, Colorado had no planning department) are considered grossly inadequate for staff or any subdivision and zoning regulations. fighting fires in multi-story buildings. Remote However, a proposal for a 1,000-acre ski development locations and dense forestation make danger from forced the county not only to hire a planning staff, fire in some second home areas even more serious. but also to employ several planning consultants to Because of such problems, some second home devel- write subdivision and zoning regulations and to re- opers have bought their own equipment and staffed view the ski development.41 In Pasco County, Flor- it themselves.38 ida, the planning and zoning budget went from $15,000 Health and Welfare ServiQes.--Health and wel- in fiscal year 1970 (when it was first created) to fare costs can also rise with the advent of second $321,000 in fiscal year 1972, as a result of mount- home developments. Some studies have reported that ing development pressures.42 The simple subdivision hospital emergency rooms are busiest during seasons of land alone can greatly increase the costs of ad- of greatest second home use, usually during the ministering and collecting property taxes. A 1,000- summer.39 Both retirement and skiing communities acre tract of unimproved woodland under single owner- also place an added burden on local health facili- ship requires only one tax notice and one deed. When ties. Local welfare roles may also increase with subdivided into 1,000 single-family recreational lots unemployed seasonal job seekers attracted to the it requires 1,000 tax notices and deeds. Additional personnel are needed to maintain the records and pro area by the prospects of employment. The problem may be aggravated because many of the jobs created cess tax notices. Warren County, Virginia .is quite in second home areas are temporary and seasonal. literally running out of courthouse Space to store However, most unemployment payments are covered by such records for the more than 12,000 recreational payroll taxes and intergovernmental transfers ear- lots subdivided there since the early 1960s. @3 marked for this purpose, and may impose little di- - In areas where widespread, unimproved recre- rect fiscal costs on local governments. ational subdivisions have occurred, tax defaults by General Government Administration-Communities unhappy recreational lot owners have driven govern- experiencing recreational land development also ment administrative costs even higher. Tax defaults face the increased administrative costs of running are especially high on property purchased through the mail. Taos County, New Mexico, where tax defaults local governments. These costs include such items 67 are occurring on 10 per cent of the subdivided rec- ational land development are important. The issue reational lots, must trace delinquent titles back is whether the revenues generated by development 10 years and transfer them to the state, an added cover the costs. This depends on a number of fac- administrative burden to local government. Because tors. One important factor is timing. Since many of low tax rates on unimproved recreational lots second homes have a tendency to become permanent and the high costs of collecting taxes (Taos County homes over time, an analysis of net fiscal impacts spent over $4,700 on postage alone for tax collec- in the early years of a project might show a tax tion notices in 1972), local officials estimate surplus, while an analysis made 10 years later could that the county nets about $ .90 per lot.44 show a deficit. Local tax distribution policies Revenues Generated by Development. The major also affect the outcome of net fiscal impacts. source of revenue from recreational land development While the overall taxes generated by one develop- is the property tax. As a general rule, property in ment in Washington state were sufficient to cover recreational land developments is assessed no differ- the increased costs of education, the allocation of ently than comparable property; for example, a sec- tax dollars to other local government departments ond home with a full market value of $20,000 would left some with deficits.51 Political boundaries pay the same taxes as a $20,000 primary home.45 How- may also have an affect: one jurisdiction reaps ever, in some areas of the country, developers re- the tax benefits of development, while its political ceive tax breaks on recreational lots which they have neighbors suffer some of the costs--without being not yet sold (a practice common for all subdivisions). compensated. For example, the city of Aspen, Colo- In Deschutes County, Oregon, recreational lots still rado, has benefited from ski development through owned by the developer are taxed at 45 per cent of higher tax revenues, while surrounding Pitkin County the normal rate at which vacant, single-family lots has experienced increased school and government owned by individuals are taxed.46 In Wisconsin, a costs without comparable increased tax revenues.52 state statute called "Planner's Consideration" makes Most studies indicate that recreational land allowances for developer's carrying costs during the development has produced tax surpluses rather than sales stages of a project by permitting lower as- deficits to date. A survey of 30 towns within the sessed valuations of developer-owned lots. A study Adirondack State Park in New York found that 29 col- of Lake Redstone, a 1,498 lot second home subdivision le.cted a net tax surplus from second homes in their reported that "lots owned by individuals were charged jurisdictions.53 The town of Mashpee, Massachu- a tax 27 per cent to 34 per cent higher than the setts, which was once bankrupt, found itself with lots owned by the corporation."47 a year-end surplus of $249,574. According to local The mere subdivision of land into residential officials, one resort development in the town, New home sites usually makes it more valuable. However, Seabury, generated $318,274 above the costs of lo- the most substantial tax increases occur when homes cal government services provided to it, accounting are constructed. In areas with high concentrations for the town's healthy fiscal status.54 A recent of second homes, a large portion of the total pro- case study of the tax impact of a recreational sub- perty tax can be paid by second homes. For example, division in central Oregon reported that the proj- in Windham County, Vermont, second home owners pay ect was "generating $57,000 more than its service more than 25 per cent of the property taxes in 10 costs.,,55 However, the study was skeptical about out of 23 towns in the county.48 Property tax reve- the chances of this fiscal surplus continuing over nues from Quechee Lakes in Vermont rose from $14,000 the long run. A study of Lake Camelot and Lake a year prior to development in 1969, to $174,000 in Sherwood recreational developments in Wisconsin 1972, with only a small portion of the project built reported net tax surpluses from the project accru-' out.49 Lake Latonka, a 1,600 lot second home pro- ing to the town, the county, and the state govern- ject in Pennsylvania, produced from $120,000 to ment.56 $140,000 more in taxes than the land had yielded These positive fiscal impacts are primarily nrior to development.50 due to the fact that most recreational subdivisions Net Fiscal Impacts. Considered alone, neither have experienced slow buildout rates to date, and the costs nor the revenues associated with recre- so far include relatively few homes requiring pub- 68 lic services. Secondly, while there is some evi- lower or hold existing tax rates constant tends to dence that second homes tend to become permanently artificially inflate positive.fiscal effects of de- occupied over time, to date the large majority of velopment. second homes are still seasonally occupied and While most communities have experienced posi- therefore make few demands on local school systems. tive fiscal impacts from recreational land develop- Another reason many rural governments show a ment to date, negative impacts are possible in some net tax surplus from recreational land development cases. The planning director of Okanogan County, is because they,do not provide all the services Washington tallied the net fiscal cost of one 2,800 which new development might need. One town super- acre recreational subdivision and concluded, "This visor stated, "The balance is currently in favor of subdivision will not, in IDy lifetime, pay for it- the town, but the reverse would be the case if the self; but I'll be paying for it . . . and so will Town of Schroon [New York] did all of the improve- all taxpayers of Okanogan County."61 A study of ments requested by leisure homeowners," which in this the tax impacts of Tejon Ranch Lake, an 8,100-acre case involved town maintenance of private roads.57 recreational development in Kern County, California, The Ludlow study included in its analysis of fiscal computed the net tax impact of the subdivision on impacts the costs of services which were needed, but the county for four different sets of assumptions which were not being met by local government. The using different rates of completion and occupancy report states: by permanent residents. The study concluded, "Our The immediate effect of second home devel- projections indicate that the net costs imposed on opment has been to over-extend the town's existing ability to provide services - . . Kern County by the 'Project' will probably range Ludlow is not providing the minimum services, from about $2 million per year to over $9 million excluding the schools, that a community of its size and type is expected to furnish, due per year, depending upon how rapidly the 'Project' to budget limitations. If these needs were is completed and what percentage of the residents being met, it would mean approximately a 50 per cent increase in Ludlow's 1973 budget are permanent.,,62 ($291,632.87).58 Negative fiscal impacts are most likely to oc- Major capital needs may also be imposed upon local cur if recreational land developments become perma- governments by recreational subdivisions, the cost nently occupied, especially by families with a of which governments may try to avoid by doing with- substantial number of school-age children. A county out as long as possible. commissioner from Warren County, Virginia, stated: Also, some local government officials state Prior to subdivision, a 1,000-acre parcel that second home owners have higher expectations of of unimproved woodland (such as on moun- tain slopes) would be appraised at approxi- services than native rural residents, an opinion mately $100 per acre, assessed at 20% and backed up by several studies. A survey of absentee at the tax rate of $3.90 will raise $780 in real estate taxes. with the current property owners in New York reported that over half cost of education (from local funds) being of the respondents ranked five major public service.% $325 per pupil, this tax would pay the cost of county services for one family including (fire protection, police protection, water, sewer, education of two children. and garbage collection) as "worse" than in the com- When that same parcel is divided into 1,000 munity where their permanent homes were, located.59 one-acre lots, and each lot is appraised at $1,000, at the same assessment ratio and tax Another study stated: rate, the subdivision will raise $7,800 in The injection of new blood into an area, in real estate taxes, or the cost of services the form of urban population with high stan- for ten two-children families. dards and high expectations of public ser- Prior to subdivision, however, with no res- vices, has firm and long term effects toward idences on the property, there is no expense upgrading the range and standards of public to the county. After subdivision, the cost services. . . . The need for more expensive to the county depends on how many dwellings local services will arise in the future in are constructed, how many are used on a full- many areas of substantial vacation home devel- time basis, and how many full-time occupants opments.60 have school-age children.. Most fiscal studies deal only with actual costs and For example, suppose fifty percent pf these revenues, and do not consider needed services which 1,000 lots are improved by dwellings averag- ing $20,000 in appraised value, and suppose are not provided. Using additional tax revenues to fifty per cent of these dwellings are occu- 69 22 -878 0 - 77 - 5 pied full-time by families with an average property also stimulate retail businesses, buying of two school-age children. The tax to groceries, gasoline, and household goods. Develop- the county would increase to approximately $86,000 for the entire subdivision, but the ment can have other impacts on the local economy, cost to the county just for the full-time too. Recreational land development can also drive occupants would increase to about $200,000 per year. This does not include costs for up local land values and housing costs. whatever services are required by the part- Community Income. There are two major sources time residents, any expansion in the present level of services nor does it include any of income which flow from recreational land develop- capital outlay, such as additional class- ment into the local economy. One consists of ex- rooms for the estimated 500 additional chil- dren.63 penditures made by developers during various stages The fiscal balance tips to the negative side when of project planning and construction; the other con- enough dwelling units become permanently occupied by sists of expenditure .s made by the occupants of rec- families with school-age children to make the costs reational subdivisions. of educating them outweigh the property taxes gen- Development Expenditures-The Office of Inter- erated by the project. This delayed tax impact has state Land SalesIRegistration estimated annual na- prompted some to label recreational subdivisions tional sales of recreational,property at roughly "tax payers tim6 bombs."64 $5.5 billion. Part of this money is used by devel- The study of second home impacts on Ludlow, opers to pay realtors, architects, engineers, plan- Vermont concluded that: ners, surveyors, attorneys, bankers and accountants, Some second home developments can be a desir- as well as for other expenditures such as site engi- able broadening of the tax base for a commun- ity. However, at some determinable time, vary- neering, road construction, utility installation, ing from community to community, this type of landscaping, home construction, and operation and development will begin to have an adverse ef- fect on the provision of general governmental management of recreational facilities. Developers services. Even when this point is reached also need building materials and other retail and and surpassed, however, seasonal residential development can still appear to have little wholesale goods. Some of these goods and services effect on the tax rate as long as expensive are purchased in the host community. Approximately capital improvements and increases in operat- ing costs actually required by the new devel- one-third of the "hard costs" incurred by developers opment-are put off by local government.65 are spent on "improvements and engineering" and One problem for many rural governments is that they '.construction of amenities."67 have no substantial commercial and industrial bases Some land development expenditures are made by from which to draw taxes. In urban communities it property owners themselves for septic tank installa- is accepted that single-family residences commonly tion, well drilling, and home construction. A study do not pay their full share of tax dollars because of Lake Latonka, Pennsylvania, a 1,275-acre second such communities can rely on property taxes from com- home deve lopment with 1,600 lots, estimated develop- mercial and industrial development to make up the ment expenditures at approximately $4 million, with difference. Unfortunately, many rural areas do not another $3 million spent by property owners on home have other resources to fall back on. The Ludlow construction'between 1965 and 1970.68 Per lot im- study states, provements were $2,500--$1,500 by the developer and The potential of as much as half of the sea- $1,000 by private utility companies. In Fairfield sonal second home units becoming permanent with school-age children and without the cor- Glade, a recreational-retirement development for responding developments of the industrial base 20,000 families in Cumberland County, Tennessee, the may be, from a governmental financial point of view, a serious problem.66 company planned direct expenditures of $27 million on land development and housing construction between -Impacts on the Local Economy 1970 and 1973.69 Improvement costs per lot averaged In addition to the fiscal effects on local gov- approximately $3,500. ernment, recreational land development affects the The proportion of these expenditures which flows entire local economy as well. Local spending by into the host community depends on the local avail- recreational land developers creates jobs and stimu- ability of the required goods and services, and on lates business activity, some of which benefits local the choices of developers and property owners as to people. Second home owners visting their vacation where to spend their money. Obviously, the smaller 70 MOW- WW_ 5 51- @21 S _4 A - High amenity resort developments often include elaborate recreational facilities, increasing the likelihood that local economies will benefit from expenditures made by developers and property owners. and less'diverse the local economy, the fewer de- fair price for his land. And, since much of this velopment expenditures it will capture. Of the property is sold to speculators who have no inten- 551 U.S. counties containing recreational subdivi- tions of using their property, local economies stand sions filed with OILSR, over half (277 counties) to gain little more from development and improve- had less than 25,000 people in 1970, with total ment expenditures made by lot buyers than those made county employment bases of less than 10,000 each. by developers. . Development expenditures vary according to The proportion of direct expenditures on land the types of recreational projects. Unimproved development and housing construction made by devel- recreational subdivisions which account for the opers and second home owners in the local economy majority of recreational land development which varies. Some developers hire large engineering has occurred in the U.S., generally make no more firms from nearby metropolitan areas, rather than improvements in the land than local land use regu- local businesses. Housing construction is usually lations require. Many attempt to avoid areas with done by local contractors, however, except where land use controls if at all possible. Expendi- home owners choose mobile homes, prefabricated tures by these developers for land improvements units, or do-it-yourself kits. In the case of Lake can run as low as $200 to $300 per lot. A major Latonka, about 25 per cent of the total dollar ex- expenditure of recreational land developers is penditures for land development accrued to the coun- made for advertising and sales costs, most of which ty.70 Seventy-five per cent of the developer's are not likely to be made in the rural host com- financing, materials, and labor expenditures were munity. As far as the local economy is concerned, made outside the county. By contrast, an estimated the original land owner may be the only one who 50 per cent of the expenditures on home building stands to gain very much from unimproved recre- were made for locally purchased materials and paid ational lot sales projects, assuming he.receives a to local business and labor. The study of Fairfield 71 Glade reported that 70 per cent of total direct de- families with fully improved second homes visited velopment expenditures would be made "within 110 them more frequently. miles of Crossville."71 However, this larger re- Several other studies discuss breakdowns in gion includes three metropolitan areas, all of local expenditures in more detail. A detailed ac- which stand to receive more of the developer's counting of second home owner expenditures which expenses than Cumberland County, where the project remain in the local economy was made in the Minne- is located. sota study: User Expenditures-The national annual build- Of the $1,092 spent locally by the average out rate in recreational subdivisions is about two second home owner, about $500, nearly 50 per cent,was for merchandise. One-third per cent, meaning that these subdivisions generate may he estimated to have stayed in the little in the way of user expenditures. However, local area. About one-third or $360 was for combination expenditures, of which an where second homes do exist, their owners make a estimated two-thirds stayed in the local variety of expenditures in the local economy for area. Since all of this was for construc- tion, the proportion will be somewhat expendable goods such as groceries and gasoline, higher where locally produced lumber is durable household goods such as furniture and available. Almost $250--more than one- fifth--was spent for services, an estimated appliances, and services such as home maintenance. 85 per cent ofwhich went to local residents. User expenditures generated by second home devel- Thus about $600 of the $1,092 remained in the second-home community to generate addi- opments depend not only on the amount of buildout, tional personal income due to the multiplier but also on patterns of occupancy. For example, a effect.74 recreational subdivision in an area sporting multi- A study in Vermont found that recreational lot seasonal recreational attractions can expect higher owners living in the state spent only about $200 per annual usage rates. Consequently, the local econo- year at their property, while out-of-state property my will experience proportionately higher levels of owners spent approximately $710 annually (property retail expenditures associated with those visits. taxes are not included in either of these figures).75 A number of studies have surveyed retail ex- other local officials have commented that the dis- penditures made by second home owners in the host tance between the second and the primary home is an community econbmy. A 1966 study of second homes important factor in retail expenditures made by sec- in New England reported average annual expenditures ond home owners. An agricultural extension agent of $1,733, not including $192.55 paid in local pro- in Warren County, Virginia, commented that families perty taxes.72 These expenditures were made for who lived fairly close to their second homes, fur- nished them with castoffs from their primary homes, groceries, meals eaten out, home maintenance, sports equipment, furniture, and other household brought their groceries with them when they visited goods. A study of second homes in northern Minne- their second homes for the weekend, and bought sota reported average annual expenditures of $1,092 nothing more locally than a tank of gasoline to get per second home ($120 of which was for local pro- back home on.76 perty taxes).73 These expenditures are broken down The above data present a range of expenditures into various categories in Figure 1. made by second home owners in various host communi- The Minnesota study found a direct relation- ties. Most of the data are somewhat outdated, and ship between levels of expenditures and the incomes current levels of expenditures are probably higher. of second home owners; families with incomes over Assuming the average second home owner spends $1,500 $20,000 spent more than twice as much as families per year in the vicinity of his second home, the 3.5 with incomes under $8,000. Expenditures were also million second homes in the U.S. contribute over related to the physical quality of the second homes $5.25 billion annually to rural economies across themselves. Families owning second homes with the country. To small, rural communities, these ex- "complete indoor plumbing" spent more than double penditures can be very significant. In a recent what second home owners with lower quality facili- survey of 30 towns in New Yorkr with populations of ties spent. The main reason for this was t hat 1,500 or less, the entire economy in nine of the 72 Figure 1. Annual Expenditures in Rural Communities by Seasonal Home Owners Household Supplies $208 Gas and oil $105 Entertainment Utilities $72 $83 Property Taxes $118 Building Construction and Maintenance $357 Clothing, $21 Furnishings and Recreation, $29 Equipment, $43 Personal Services, $14 Other, $42 Source: Robert W. Snyder, "Seasonal Homes Benefit Rural Minnesota," Minnesota Science, Vol. 24, No. 2, (Winter, 1968), n.p. towns revolved around second homes.77 Local resi- effects of successive expenditures of that initial dents considered second homes vital to their econo- direct income. Part of the initial expenditures my. One example was the Town of Schroon: simply pass through local hands on their way out of . . . five building contractors, each em- the economy: they are "leaked" through the purchase ploying about 10 local men, depend on lei- of nonlocal goods and services, taxes, savings, and sure homes for 75%-plus of their business; 2 excavation contractors, employing 3 or 4 so on. However, a proportion of each dollar re- local men each, depend largely on leisure ceived by a local business or wage earner will be homes; a local building supplier, who has his own sawmill, supplies 75% of the build- respent in the local economy. The total impact on ing materials used by leisure homes; 2 community income will be some multiple value of the@ electrical contractors and 2 plumbers de- pend largely on leisure homes for their initial direct expenditures made by developers and business; and numerous caretaking jobs.78 second home owners. This process is called the Multiplier Effect.--The ini tial expenditures multiplier effectr and is illustrated in Figure 2. made by developers and second home owners in the The multiplier effect can be measured in terms local economy account for only the direct income of both income and jobs, andvaries from one com- received by the host community. However, the total munity to the next, with the size of the multiplier economic impact of local income derived from recre- dependent on both the si ze and diversity of the ational land development also includes the indirect local economy. In one study of the economic effects 73 Figure 2. Multiplier Effect-An Initial Income The case study of Lake Latonka, Pennsylvania, men- of $10.00 Will Upon Successive Respending tioned earlier made no attempt to derive a local Earn: .(For a Leakage of 50 Per Cent multiplier for Mercer County, but noted that the First Round $10.00 -50% appropriate multiplier was somewhere between 1.0 Second +5.00 -50% and 2.0.81 The study of Fairfield Glade chose a Third +2.50 multiplier of 1.8, based upon the findings of two Fourth +1.25 -50% other studies.82 Fifth +.63 -50% Employment. Recreational land development can Sixth +.31 -50% create new jobs in rural areas, depending on the ex- Seventh +.16 tent of development activity, the level of project Eighth +.08 -50% improvements, and the growth of the service sector Ninth +.04 -50% of the economy supporting new development. Unim- Tenth +.02 -50% proved recreational subdivisions offer very little in the way of new employment opportunities. Not much site development activity or housing construc- Sum $20.00 tion takes place, and since most of the recreation- al lots go unused, there is little additional de- mand for retail services. Source: Robert R. Nathan Associates, Inc., and Improved second home developments, on the other Resource Planning Associates, RecreatioA As an Industry, Appalachian Research Report No.2 hand, can have substantial positive impacts on the Prepared for the Appalachian Regional Commis- local job market. Table 1 shows increases in vari- sion, (Washington, December, 1966), p. 58. ous types of employment and payroll growth between 1967 and 1971 in various types of businesses in of the general commercial recreation industry on Adams County, Wisconsin (where the number of second counties within the Appalachian region of the U.S., homes more than doubled between 1960 and 1970) when county multipliers averaged 1.87, ranging from a a major 2,840-acre second home project, the Lake low of 1.13 to a high of 2.63.79 Translated into Sherwood--Lake Camelot complex, was developed.83 income, this means that for each $100 spent on rec- As shown in Table 1, the finance, insurance and reation with the local e.conomy, the total income real estate sector of the economy increased by 233.3 (direct and indirect) derived from that expenditure per cent, and retail trade increased 59.3 per cent. would equal $187. Translated into employment fig- In analyzing the net effects of development on ures, each person directly employed in recreational local employment--the number and types of jobs jobs would provide an additional .87 persons with created by development should be compared to the other employment. (The employment multiplier is number and types of jobs displaced. Much of the not necessarily equal to the income multiplier.) seven million acres of recreational property regis- The study found that communities with a labor force tered with OILSR supported some viable economic of less than 1,000 had multipliers under 1.5, while activity prior to subdivision. In Warren County, those in the 1,000 to 5,000 employee range had mul- Virginia, recreational subdivisions have displaced tipliers of 1.5 to 1.8. Beyond the 5,000 employee logging activities, meaning the loss of jobs for level, the multiplier continued to go up with fur- loggers, truck drivers, and sawmill operators.84 ther increases in the size of the labor force. Many recreational subdivisions were formerly pro- The Appalachian Regional Commission Study ductive farms, or in the Southwest, ranches. While suggested that the multiplier.effect for second these operations may be only marginally productive, home development might be slightly higher than for they do generate employment and income.85 the commercial recreational industry as a whole: New jobs created by recreational land develop- Vacation homes present a special aspect ment include construction and building trades if of recreation. The benefits flowing the project involves substantial improvements. from vacation home development have a more widespread effect than the benefits Many of the new job openings are for clerks in from comme .rcial recreation enterprises.80 small shops and stores, gas station attendants, 74 Table 1. Employment and Payroll Growth of Figure 3. Seasonal Index of Service Employment, Business Units in Adams County, Wisconsin Vermont, 1969 1967-1971 Per Cent 160- Type of Business 1967 1971 Change 140- Retail trade 189 301 59.3 Manufacturing 166 144 -13.3 120-- Finance, insurance and real estate 39 130 233.3 Mining .(D) decline decline Services 168 247 47.0 100-.- Wholesale trade (D) (D) (D) Contract construction 28 36 28.6 Transportation and 8O__ public utilities 55. (D) (D) 60- All Business Units 797 995 24.8 JAN FEB MAR APR MAY JUN JUL AUG SEP OCT NOV DEC I I Lamoille (D): Indicates disclosure is prohibited. Windham County Source: County Business Patterns-Wisconsin, 1967, Source: Vermont Social and Economic Characteris- 1971, Bureau of the Census, U.S. Department tics, Prepared under the auspices of the Ver- of Commerce. mont State Planning Office, June 1971, p. 59. waitresses in restaurants, and so on. While impor- competed with local residents for the new jobs. The tant to local economies, such retail jobs are among Appalachian Regional Commission study of the commer- the lowest paying jobs available. The Appalachian cial recreational industry stated: "Because of the Regional Commission study states: high peak employment many outsiders, mainly students, Compared to manufacturing employment, the have to be recruited to fill vacancies."88 A study wages in the service and trade industries of the ski and recreational land development indus- are low, and the recreation sector includes some of the lowest wages. Most of the oc- try in Warren County, Vermont, found that 88 per cupations require simple skills and little cent of the full-time, year-round jobs generated by training; consequently the pay is poor.86 The seasonality of employment in recreational development "are held by people who moved into War- areas can be a drawback. Not only are construction ren after development began."89 Local residents jobs likely to be temporary, but many of the retail also held few of the part-time jobs created by de- and service jobs created by second home development velopment. are available only during peak recreation seasons. Surveying 30 businesses, the Vermont study also Such seasonal fluctuations require heavy recruit- found that 83 per cent were owned or managed by ment during one season of the year and subsequent people who either did not live in Vermont, or who layoffs during another. The 22 largest ski areas moved to Warren, Vermont after development began.90 in Vermont have created 3,771 direct jobs, only 653 The study states that "local Vermonters have not of which are year-round.87 Figure 3 illustrates fared any better in getting managerial positions or the seasonality of employment in service industries in becoming businessmen than in getting jobs gener- in two Vermont Counties, Lamiolle and Windham, both ated by the ski development.". Field interviews con- of which experienced rapid growth in ski and second ducted in another popular ski area, Vail, Colorado, home development during the 1960s. found that most of the firms at Vail were operated Another important consideration is who gets by people new to the area.91 the new jobs. Recreational and retirement develop- Housing Costs and Land Values. Another economic ment in Paso County, Florida, attracted.many people impact of recreational land development on the host community is its effect on land values and housing from outside the community seeking employment who 75 costs in general. The costs of housing construc- market was strictly a seller's market. Land which tion are rising beyond the means of rural families sold for $40 an acre in 1967 now sells for $500, in many parts of the country, although not yet well and anyone in Deschutes County could sell his land documented. The inflated cost of land in recre- anytime he wished.97 ational areas has made the problem even more acute Such increased land values often result in in some communities. In Summit County, Colorado, increased taxes and, in some cases, marginally pro- land values have skyrocketed in recent years, from ductive farms have been taxed out of business.. A as low as $500 to $1,000 per acre to over $8,500 Vermont study states: and up.92 In Warren County, Virginia, a local . . when a woodlot happens to be located official said that native residents could no longer near a suburban area.or recreation area, an appraisal at house lot value quickly afford housing in the community due to the specu- encourages its sale. Gross income from lative rise in land prices caused by the more than an average acre of Vermont woodland is 90 recreational subdivisions located there.93 Com- $2.68 per year and as soon as the opportun- ity to develop the land for recreation be- menting on the effects of a major resort develop- comes feasible, land holders will avail themselves of the opportunity.98 ment the president of the Edinburg, Virginia Cham- ber of Commerce said that one of the most distress- Land sales to nonresidents in Iowa County, Wisconsin ing aspects of the project was the escalation of have placed remote, rural farms in similar positions land prices which were "rubbing off on valley land as farms on the urban fringe facing suburbanization, sending land values and taxes upwards, "even though prices so that local people can't afford to buy a there is little visible evidence in the town of more home anymore. It used to be that a young couple improvements, people or governmental services to here in Edinburg making $100 or $150 a week could help explain the upward trends."99 buy a lot for $500 and build a house. But now they Development and second home growth can affect can't."94 Similar situations were reported by other prices as well. The greater buying power of local officials and residents during field inter- more affluent second home owners tends to drive up views in Vermont and Oregon. Even in Bass Harbor, the prices of consumer items in general, especially Maine, where recreational land development has not during seasonal population peaks. As one resident yet been heavy, the influx of more affluent out- of Waitsfield, Vermont described the situation: siders has brought housing problems. According to "At the height of the season, meat is 30 cents a the town clerk, with the escalating prices of land pound more than it is in [nearby] Parishville at the and housing, mobile homes may be the "only recourse" same time of year, and you have to stand in line to local people have left.95 get it."100 Local residents interviewed about rec- In Aspen, Colorado, service employees of ski reational land development in Summit County, Colo- developments are having serious problems finding housing they can afford. There is no publicly sub- rado, said that "if they had to make purchases in sidized, low-cost housing, and trailer parks seem the local economy they could not afford to live there. In all cases the remedy was three or four to be the only answer.96 In Deschusets County, trips a month to Denver for shopping."101 Oregon, one local official said that the local land NOTES 1. This chapter was derived from an unpublished ington: Economic Research Service, U.S. Depart- paper entitled "An Assessi,.,.ent of the Economic ment of Agriculture, 1970), p. 9; Northern New and Fiscal Consequences of Second Home and England Vacation Home Study, 1966, (Washington: Recreational Land Development," Prepared for Bureau of Outdoor Recreation, U.S. Department this study by the Urban Land Institute, Wash- of interior, 1966). p. 12; Robert R. Nathan ington, D.C., April, 1974. Associates, Inc., and Resource Planning Associ- ates, Recreation as an Industry Research Re- 2. Studies which discuss multiplier effects of port No. 2, (Washington: Appalachian Regional second home development include: Richard Commission, 1966), p. 55. Brown, Economic Impact of Second Home Communi- ties, A Case Study of Lake Latonka, Pa., (Wash- 3. Domestic Council, office of the President, Re- port on National Growth, 1972), p. 25. 76 4. Second Home Developments, Congressional Record mont: Southern Windsor County Regional Plan- Senate, March 22, 1973, Sec. 5540. ning and Development Commission, 1973), p. 54. 5. Ibid. 23. Telephone interview with Mr. Rausch, Mercer County School Superintendent, Mercer County, 6. Interview with Richard N. Rollason, Chairman, Pennsylvania, November, 1973. Warren County Planning Commission, Virginia, April, 1973. 24. Correspondence with Arthur Olson, M. cit. 7. Second Home Developments, Congressional Rec- 25. Lyle E. Harrell, "Tour of Subdivisions in Las- ord, op. cit. sen and Madera Counties," op. cit. p. 4. 26. Edwin L. Johnson, Effect of Second Home De- 8. "Improper Sewage Disposal Cited," The Denver velopment on Ludlow, Vermont, 22. cit., P. Post, September 28, 1971, p. 20. 58-59. 9. Stephen E. Stine, Planning Recreational Com- 27. "Crime, Drugs Up When Rural Land Developed," munities to Serve Metropolitan Areas, Unpub- St. Lawrence Plain Dealer, Canton, N.Y., lished masters thesis, (Atlanta: Georgia September 6, 1972. Institute of Technology, October, 1973), p.66, 10. Wilbert J. Ulman, Mountain Recreational Com- 28. Lucy Ware Morgan, "Pasco Population: 107,750," munities and Land Use: "The Summit County St. Petersburg Times, April 21, 1973, p. 1. Experience," (Denver: The Colorado Land Use 29. Interview with Richard Morgan, North Suncoast Commission, 1974), p. 74. Bureau Chief, St. Petersburg Times, New Port 11. Ibid. p. 79. Richy, Florida, August, 1973. 12. Lyle E. Harrell, "Tour of Subdivisions in 30. Stephen E. Stine, Planning Recreational Com- Lassen and Madera Countiesr" Unpublished mu ities to Serve Metropolitan Areas, 2k. cit., paper, Josephine County Planning Department, p. 69. Grants Pass, Oregon, 1971, p. 3. 31. Edwin L. Johnson, Effect of Second Home Devel- opment on Ludlow, Vermont, op. cit., p. 44. 13. Wilbert J. Ulman, Mountain Recreational Com- munities and Land Use: "The Summit County- 32. Stephen E. Stine, Planning Recreational Com- Experience," op. cit. p. 73. munities to Serve Metropolitan Areas, op. cit., 14. Stephen E. Stine, Planning Recreational Com- 33. Interview with John Cronan, Town Manager, Wil- munities to Serve Metropolitan Areas, op. cit. mington, Vermont, August, 1973. p. 72. 15. "Seasonal Variations in visitors Presents 34. "Crime, Drugs Up When IRural Land Developed," Biggest Disposal Difficulty," Solid Wastes op- cit. management, 1972, p. 28. 35. Edwin L. Johnson, Effect on Second Home Devel- 16. Charles I. Zinser, The Impact of Leisure Homes opment on Ludlow, Vermont, op. ELit., p. 43. on the Economy of the Area Within the "Blue 36. Stephen E. Stine, Planning Recreational Com- Line" of the Adirondack Park, Unpublished munities to Serve Metropolitan Areas, op. cit., doctoral thesis, (Urbana, Illinois: Graduate p. 70. College of the University of Illinois at Urbana-Champaign, 1974), p. 162. 37. Edwin L. Johnson, Effect of Second Home Devel- 17. Interview with Lorrin Morgan, Planning Direc- opment on Ludlow, Vermont, op. cit., p. 38. tor, Deschutes County, Oregon, August, 1973. 38. Interview with Ted Smith, Development Manager, 18. Telephone interview with Tom Shepstone, Plan- Sunriver Properties, Inc., Sunriver, Oregon, ning Director, Wayne County, Pennsylvania, August, 1973. Feburary, 1974. 39. Stephen E. Stine, Planning Recreational Com- 19. Helen Privett Bird, "Environmental and Eco- munities to Serve Metropolitan Areas., op. Li@t. nomic Impact of Rapid Growth on a Rural Area: p. 67. Palm Coast," Environmental Affairs, 11 40. Edwin L. Johnson, Effect of Second Home Devel- (Spring, 1972), p. 154. opment on Ludlow, Vermont, op. cit., p. 36. 20. Lyle E. Harrell, "Tour of Subdivisions in 41. Interview with county planning staff, Grand Lassen and Madera Counties," op. cit. p. 4. County, Colorado, August, 1973. 21. Telephone interview and correspondence with 42. Tabulated from Pasco County Annual Reports, Arthur Olson, Planning Director, Okanogan Fiscal Year 1970 and 1972. County, Washington, September, 1973. 22. Edwin L. Johnson, Effect of Second Home Devel- 43. Interview with Elizabeth Malta, Warren County Supervisor, Warren County, Virginia, August, opment on Ludlow, Vermont, (Springfield, Ver- 1973. 77 44. Interview with Manuel Varela, County Offi- partment of Consumer Economics and Public cial, Taos County, New Mexico, August, 1973. Policy, Cornell University, July, 1973), p. 54. 45. Charles I. Zinzer, The Impact of Leisure Homes 60. Robert R. Nathan Associates, Inc., and Resource on the Economy of the Area Within the "Blue Planning Associates, Recreation as an Industry, Line" of the Adirondack Park, op. cit., p. op. cit., p. 54-55. 160. 61. Correspondence with Arthur Olson, op. cit. 46. Michael H. Wilkins, Recreation-Residential Subdivision and Development Activities in 62. Systems Management Associates, The Tejon Ranch Deschutes County, Oregon, Unpublished masters Lake Project: An Evaluation of Its Impact on thesis, (Eugene, Oregon: Department of Urban Kern County Taxpayers, Abstract, Prepared for Planning, University of Oregon, December, Project Land Use Task Force, (Bakersfield, 1971), p. 60-61. California: Systems Management Associates, December 30, 1972), p. 2. 47. Clyde W. Richey, "Value and Property Taxes of a Second Home Subdivision: A Case Study," 63. William E. Shands, The Subdivision of Virginia's Land Economics, Vol. XLVIII, No. 4, November, Mountains: The Environmental Impact of Recre- 1972, p. 390. ational Subdivisions in the Massanutten Moun- tain-Blue Ridge Area, Virginia: Survey and 48. Walter Blucher, et. al., An Analysis of Social Report, (Washington: Central Atlantic Environ- and Economic Characteristics of Vermont, pre- ment Center, February, 1974), p. 34-35. pared under the auspices of the Vermont State Planning Office, June, 1971, p. 98. 64. "Subdivision 'Benefits' Mixed Bag," The Bulle- tin, Bend, Oregon, February 8, 1972, p. 3. 49. Quechee Times, Quechee Lakes, Vermont, Septem- ber, 1973. 65. Edwin L. Johnson, Effect of Second Home Develop ment on Ludlow, Vermont, op. cit., p. 5. 50. Richard Brown, Economic Impact of Second Home Communities: A Case Study of Lake Latonka, 66. Ibid., p. 6. Pa., ERS Report 425 (Washington: Economic Research Service, U.S. Department of Agricul- 67. "Survey of Recreational Land Developers and ture, November, 1970), p. IV. Their Projects," Unpublished survey conducted for this study by Richard L. Raqatz and the 51. Correspondence with Arthur Olson, op. cit. Urban Land Institute, (Washington, 1973), n.p., 52. Interview with Donna Bauer, Office of Plan- 68. Richard Brown, Economic Impact of Second Home ning, Aspen, Colorado, November, 1973. Communities: A Case Study of Lake Latonka, Pa-, op. cit-, p- 25- 53. Charles I. Zinzer, The Impact of Leisure Homes on the Economy of the Area Within the 69. Allan L. Pennington, The Economic Impact of the "Blue Line" of the Adirondack Park, op. cit., Proposed Fairfield Bay, Inc. Retirement-Recre- P. 158. ation Complex on Cumberland, Co., Tennessee, Prepared for Fairfield Bay, Inc., Little Rock, 54. Letter from the Board of Selectman, Town of Arkansas, undated; and, John L. Pepin, Fair- Mashpee, Massachusetts, June, 1973. field Galde--Its Socio-Economic Impact on Crossville, Cumberland County, July, 1973. 55. Gregory D. Tillson, Russell C. Youmans and Marion D. Thomas, Local Tax Impact of Recre- 70. Richard Brown, Economic Impact of Second Home ational Sub-Divisions: A Case Study, Special Communities: A Case Study of Lake Latonka, Report 365, Oregon State University Extension Pa., op. cit., p. 25. Service, July, 1972, p. 9. 71. John L. Pepin, Fairfield Glade--Its Socio- 56. Harold LeJeune, Economic Impacts of Artifi- Economic Impact on Crossville, Cumberland cial Lake Development: Lakes Sherwood and 221nt y, 22- cit- Camelot, A Case History, (Madison, Wisconsin: Upper Great Lakes Regional Commission, April, 72. Bureau of Outdoor Recreation, U.S. Department 1972), p. 37-39. of Interior, Northern New England Vacation Home Study, 1966, op. cit., p. 10. 57. Charles I. Zinzer, The Impact of Leisure Homes on the Economy of the Area Within the 73. Robert W. Snyder, "Seasonal Homes Benefit Rural "Blue Line" of the Adirondack Park, op. cit., Minnesota," Minnesota Science, Vol. 24, No. 2, p. 159. (Winter, 1968). 58. Edwin L. Johnson, Effect of Second Home De- 74. Ibid. velopment on Ludlow, Vermont, op. cit., p. 7. 75. Robert 0. Sinclair and Stephen B. Meyer, Non- 59. Lester H. Bagg, Carolyn Lebsock, and Richard resident Ownership of Property in Vermont, Lee Ragatz, The Role of the Absentee Property Bulletin 670, (Burlington, Vermoht: Agricul- Owner in Community Development, Cornell Mis- tural Experiment Station, University of Ver- cellaneous Bulletin (Ithaca, New York: De- mont, May, 1972), p. 25. 78 76. Interview with John Crist, Social Conserva- 88. Robert R. Nathan Associates, Inc., and Resource tion Service, Lurray, Virginia, April, 1973. Planning Associates, Recreation as an Industry, op. cit., P. 50. 77. Charles I. Zinzer, The Impact of Leisure Homes on the Economy of the Area Within the "Blue Line" of the Adirondack Park, op. cit., 89. Stephen Hedger, Project Director, Downhill in p. 164-65. Warren: The Effects of the Ski Industry and and Land Development on Warren, Vermont, mimeo- 78. Ibid., p. 165. graphed (Montpelier, Vermont: Vermont Public Interest Research Group, Inc., October, 1972), 79. Robert R. Nathan Associates, Inc., and Re- p. 3. source Planning Associates, Recreation as an Industry, op. cit., p. 57. 90. Ibid., p. 8. 80. Ibid., p. 52. 91. Interview with Don Macinduffer, Planning Direc- tor, Vail Associates, Vail Colorado, November, 1973. 81. Richard Brown, Economic Impact of Second Home Communities: A Case Study of Lake 92. Wilbert J. Ulman, Mountain Recreational Commun- Latonka, Pa., op. Cit- ities and Land Use: "The Summit County Experi- ence," op. cit., p. 42. 82. Cited works from which the multiplier was derived are: Robert R. Edminster and Osmond 93. Interview with Warren Duncan, Town Manager, L. Harline, An Economic Study of the Pro- Front Royal, Virginia, April, 1973. posed Canyonlands National Park and Related Recreation (Salt Lake City, Utah: Bureau .94. Ken Ringle, "Land Rush Changes Massanutten of Economic and Business Research, University Rural Life," The Washington Post, Tuesday, of Utah, 1962), p. 12; and C.B. Easterwood September 4, 1973. and Paul R. Lowry, The Socio-Economic Impact of the Proposed Potomac National River on the 95. Lynne Langley, "Undiscovered Harbor," Maine Contiguous Counties, Bureau of Business and Times, Vol. 5, No. 42, July 20, 1973, p-.3. Economic Research, Memphis State University, 1969. 96. Interview with Donna Bauer, op. cit. 83. Harold LeJeune, Net Tax Effect of Lake Sher- 97. Interview with Everett Turner, President, wood and Lake Camelot, A seminar report sub- Central Oregon Board of Realtors, Bend, Ore- mitted in partial fulfillment of the require- gon, August, 1973. ments for the degree of Master of Science, (Madison, Wisconsin: Cooperative Extension 98. Walter Blucher, et. al., An Analysis of Social Education, The University of Wis6onsin,1971), and Economic Cha@r_acteristics of Vermont, p. 1 and 7. op. cit., P. 88. 84. Interview with John Crist, op. cit. 99. Richard L. Stauber, The Tax on Property in Iowa County, Part II. (Madison, Wisconsin: 85. Local officials in Colorado, Washington, Institute of Governmental Affairs, University Montana, and Florida noted that considerable of Wisconsin-Extension, in cooperation with acreage previously used for farms, grazing The Department of Local Affairs and Develop- and timber production was displaced by rec- ment, 1973), p. 52. reational land development. 100. "Crime, Drugs Up When Rural Land Developed," 86. Robert R. Nathan Associates, Inc., and Re- it. OP- cir source Planning Associates, Recreation as.an Industry, op. cit., p. 48. 101.* Wilbert J. Ulman, Mountain Recreational Com- munities and Land Use: "The Summit County 87. J. Robert Hill, "1970 Vermont Ski Area Sur- Experience," op. cit., p. 42. vey," The Interagency Committee on Natural Resources, p. 19. 79 CHAPTER 5 SOCIAL AND CONSUMER IMPACTS OF RECREATIONAL LAND DEVELOPMENT Recreational land development can also affect community; with its rapidly expanding waves of vacation homes, bars, motels, and other host communities in other important ways besides commercial amenities; and with its predomi- through its environmental and economic impacts. nance of financially well-endowed out-of- Development can transform the social structure and staters, Stowe stands as a living example of what many other Vermont towns can poten- culture of rural communities. As the "summer peo- tially become as Vermont grows as a recre- ple" move to the countryside they bring with them ational outpost and full-time home for out- of-staters.2 fragments of their urban lifestyles, reflected in Recreational development has also transformed everything from increased traffic congestion and the Tahoe Basin into what has been called an "urban litter to different attitudes toward private prop- forest" with ". . increasing crime rates of all erty. Families converting second homes into year- kinds, crowding of public and private facilities, round residences become permanent members of the increased vehicular traffic beyond the carrying community and may even change its political struc- capacity of existing road systems, serious air pol- ture. As one local official put it, ". . -the more lution, litter in great quantity, higher noise levels people who.live in the country, the less 'country' and the like.',3 While Stowe and Tahoe are extreme it becomes."l examples of recreational and second home areas which The effects of the recreational land industry have become overdeveloped, many other communities on consumers have also been substantial. Probably have felt similar effects to lesser degrees. better known than any other single impact of devel- Cultural changes resulting from second home opment, consumer victimization has been a serious development seem most@threatening to rural residents national problem since the very beginning of the in areas where the sense of traditional culture is recreational land sales business. strong, as it is in many parts of New England. This chapter takes a brief look at some of As vacationers and new residents continue the major social effects that recreational land to pour into the area, the culture of this development can have on host communities, and local area, long a bastion of traditional rural Vermontism, will be diluted more and more attitudes toward these changes. Consumer victimi- toward the metropolitan culture that the zation is also examined. While these types of de- people have brought with them. As a result, the renowned independent rural culture of velopment impact are not always as easily measured Vermont will take a further step towards obsolescence.4 or documented as the environmental and economic effects of development, they are no less important The effects of growth and development can be subtly since they directly affect the quality of life of felt in small communities as existing social struc- those involved. tures and local institutions gradually begin to change. Social Impacts There is also . . . a general lessening of a sense of community in Fort Valley as more Changing Rural Culture. In its broadest sense, new people move in, attuned to a different the social impacts of recreational land development rhythm of life . . . instead of seeking people out they withdraw from them. . . . involve the gradual change of traditional rural Church life has always been a center of cultures and lifestyles into more urban environ- life in the valley . . . but the new people are up here on vacation or maybe on the ments. This change of character is felt in the weekend and don't feel obligated to go to physical transformation of communities as they be- church. They want to go visiting and buy their vegetables and eggs at the same time come more built up with recreational subdivisions, when people here usually go to church. So second homes, and related commercial facilities. *after awhile, people here start staying home to sell eggs and you have few people One observer describes the changing character of at church.5 Stowe, Vermont: Some communities report increases in crime With its decline as a traditional Vermont associated with intensive second home development. 81 Vandalism and burglary of vacant second homes are Characteristics of Second Home Owners.--Second particular problems. In Berkshire County, Massa- home ownership is no longer the exclusive privilege chusetts, breaking-and-entering and larceny cases of upper income families. Compared with the average average six a week, and second homes are the major household, second home owners earn somewhat higher target.6 Increased crime has meant more police for incomes, are older, and have slightly smaller fami- Waitsville, Vermont: lies (see Figure 1). In addition, more second We have two new State Police stationed in home owners own first homes than the rest of the the town and three new Deputy Sheriffs. population, and their first homes have higher market We need them to cope with the traffic, the crime rate, which has gone up, and the values than the average American home. According serious drug problem we now face.7 to one study, most recreational property buyers have Traffic congestion, especially on peak season- professional or managerial jobs, and have some col- al weekends, is also a problem. So is the increase lege education. Over one-fifth are college gradu- of trash and litter.8 And some communities have ates.10 expressed concern over the potential prospects of In 1970, the median family income for second poorly constructed second homes becoming blighted home owners was $10,950; it was $8,600 for all U.S. and run down. One local official commented, "Many households.11 Regional variations in median in- of the lakefront developments which started as va- comes for second home owners ranged from a high of cation spots have converted to permanent residences $11,200 in the Northeast to a low of $8,500 in the --usually with a slum character."9 South. These variations correspond roughly to Several of the economic impacts of recreation- national patterns for all family incomes. While al development discussed in the preceding chapter one-fourth (27.1 per cent) of all households had also have important social effects on rural fami- over $15,000 annual income in 1970, one-third (33 lies and rural lifestyles. For example, the way in per cent) of the second home owners had incomes which people earn their living changes as specula- over $15,000. It should be noted that since Census tive subdivisions and second homes replace farms data include all families which own second homes re- and woodlands. Where second home development has gardless of when they bought them, the incomes of been intensive, as in many Vermont communities, all second home owners tend to vary less from na- recreational economies have almost totally replaced tional norms than do other figures from more recent agricultural ones. In communities where farming is surveys. Census figures also include many retired economically marginal, opportunities to sell out couples who bought their second homes years ago are often considered a blessing. In other areas, while actively employed, but whose current annual however, such as the thriving dairy region of Wal-. incomes may be quite low. worth County, Wisconsin, there have been strong National income data on recreational lot buyers efforts to preserve dairy farming as a way of life are not collected by the Census. However, a 1973 in the face of heavy economic pressure from land California survey of re IcIreational lot buyers re- speculation and recreational development. The in- ported average family incomes at $17,000 with 46 creased costs of land and housing in rural areas per cent earning over $15,000, as shown in Table 1. are also an important social problem which many Families owning second homes tend to be slight- communities face (discussed in Chapter 4). It is ly smaller than average American families. Accord- ironic that the desire for second homes by some ing to the 1970 Census, the median U.S. household families helps to drive up the costs of land and housing for others struggling to acquire adequate size was 2.7 persons; it was 2.6 persons for house- holds owning second homes. Over one-third (35 per first homes. Contrasts in Population Characteri .stics. The cent) of the households owning second homes consist- cultural changes felt in second home areas are in ed of only two persons.. Although 28 per cent of all part due to the contrasts between second home U.S. household heads were under 35 years of age, owners and existing residents of rural. communi- only 14 per cent of the household heads owning sec- ties. ond homes were under 35. On the other hand, 30.6 per cent of all household heads in the country were 82 Figure 1. Socio-Economic comparisons of Households Owning Second Homes with All U.S. Households, 1970 50 yrs. $10,000 25 yrs. $5,000 Median Annual Median Age of Family Income Household Head 3 100% 2 50% Median Family Size Percentage owning Primary Home $20,000 100% ..... ..... $10,000 50% x-X':'j X X. X Value of Primary Per Cent Caucasian Owned Home Household Heads All U.S. Households Households Owning a Second Home Sources: Data for Households Owning Second Homes: U.S. Department of Commerce, Bureau of the Census, Public Use Sample of Basic Records from the 1970 Census, State Samples. Data for All U.S. Households: U.S. Department of Commerce, Bureau of the Census,-Metro- politan Housing Characteristics, United States and Regions, 1970. Report No. HC(2)-l. (Washington: Government Printing Office, 1972.) Tables A-3, A-7, and A-8; and U.S. Depart- ment of Commerce, Bureau of the Census, Detailed Housing Characteristics, United States Summary, 1970. Report No. HC(l)-Bl. (Washington: Government Printing Office, 1972.) Tables 29, 31, and 54. H 83 Table 1. Selected Characteristics of Recreational Lot Buyers, Siskiyou County, California, 1972 Characteristic Percent of Characteristic Percent of Respondents Respondents Annual Family Income Years of Formal Education Less than $10,000 24.3 Less than 9 years 7.0 $10,000 to $14,999 29.6 9 to 12 years 39.0 $15,000 to $24,999 38.3 13 to 16 years 32.0 $25,000 and over 7.8 17 years or more 22.0 100.0 100.0 Age of Household Head Occupation of Household Head Less than 31 years 17.3 Professional 43.0 31 to 40 years 21.6 Manager 12.0 41 to 50 years 32.2 Sales 4.0 51 to 60 years 22.4 Clerical 3.0 60 years or more 6.5 Craftsmen 15.0 100.0 Other 23.0 100.0 Source: T.E. Dickison and W.E. Johnston, "An Evaluation of Owner's Expectations of Building Within Remote Rural Subdivisions: Impacts on the Rural Community" (Paper presented for the Joint Annual Meetings of the American, Canadian, and Western Agricultural Economics Association, Edmonton, Alberta, August, 1973), pp. 11 and 29. 55 years old or older, while 4.16 per cent of the one in fifteen. In rural areas, however, one per- households owning second homes were over 55, Almost son in four is classified as poor.13 Rural popula- all second home owners were caucasian (94. 1 percent) tions also tend to be disproportionately young and and 73.1 per cent of them owned their primary homes old, with fewer people in the 20 to 64 year age as compared with 59.3 per cent of all U.S. house- groups due to rural-urban migration patterns.14 holds. In addition, over one-third (37.4 per cent) Impacts on Recreational Opportunities. Public of the households owning second homes also owned pri- recreational opportunities can also be affected by Mary homes valued at more than $ 25, 000, compared with development. In some cases new opportunities are only 23.8 per cent of all U.S. households. created; in other cases existing opportunities are Most second home owners live in urban areas reduced or lost. -In Deschutes County, one resort (see Figure 2). In 1970, over 75 per cent of all development opened its facilities (agolf course and second home owners were classified as urban resi- lodge) to the general public on a fee basis, making dents, as shown in Table 2. Over two-thirds (68 per the project a major recreational asset to the neigh- cent) of them lived in Standard Metropolitan Statis- boring community.15 But such cases are understand- tical Areas. Of that group, 31 per cent lived in ably rare. most projects include few recreational central cities and 26.2 per cent lived in the "urban facilities, and those which do usually reserve them balance" or suburbs. Nearly one-fourth (24.5 per exclusively for property owners (see Chapter 2). cent) of all second home owners lived in 10 metropoli- In some cases, public recreational opportuni- tan areas (New York, Los Angeles, Detroit, Chicago, ties have been reduced by second home developments. Philadelphia, Boston, San Francisco, Washington, In many parts of the country, for example, recre- D.C., Minneapolis/St. Paul, and Houston). ational lots and second homes adjacent to lakes, Rural Population Characteristics-In contrast coastlines, rivers, and public lands have inhibited, to second home owners, incomes and educational lev- and in some cases restricted public access to these els among rural families fall below the national areas by erecting a "wall of private ownership."16 average.12 There is more poverty among rural fami- In Deschutes County, Oregon several miles of Des- lies than urban ones. In metropolitan areas, one chutes River frontage were rendered inaccessible by in eight persons lives in poverty; in the suburbs, recreational projects along its banks.17 And in 84 Table 2. Households Owning Second Homes By Selected Geographical Divisions, United States, 1970 Percent of Total Geographical Total Households Percent of Households Owning Division Households Total Total a Second Home Second Homel Households (% of 2,889,771) United States 63,446,641 2,889,771 4.6 100.0 Inside SMSAs 43,866,473 1,964,714 4.5 68.0 Central City 21,627,464 896,910 4.1 31.0 Urban Balance 15,663,419 756,002 4.8 26.2 Remainder 6,575,590 311,802 4.7 10.8 Outside SMSAs 19,580,168 925,057 4.7 32.0 Urban2 47,649,414 2,174, 215 4.6 75.2 Rural 15,797,227 715,556 4.5 24.8 Rural-Nonfarm 12,720,372 586,405 4.6 20.3 Rural-farm 3,076,855 129,151 4.2 4.5 1A Second home is defined by the 1970 Census as, a single-family house, vacation cottage, hunting cabin, ski lodge, etc., which is owned and held for use sometime during the year by the owner or member of his household." 2"urban" refers to all urbanized areas as defined by the Census plus all places of 2,500 or more inhabi- tants outside of urbanized areas. Source: Derived from: United States Department of Commerce, Bureau of the Census, U.S. Census of Housing, 1970, Detailed Housing Characteristics (Washington: Government Printing Office, 1972.) Final Report HC(l)-Bl-52, Tables 37, 45, and 55. Warren County, Virginia, many local landowners had sail boating on small lakes, can compound these prob- once permitted public access to the George Washing- lems. One study states: ton National Forest across their property. Some- With more lake-lot owners and heavier use of times, local landowners even allowed hunting and lakes by the general public, pressures upon the water rise rapidly. Conflicts growing fishing on their own property. Once subdivided and out of these competing demands increase as sold, however, theqe lands were often posted with lakes become overloaded.21 Another study reported that 55 lakes surveyed no trespassing signs and traditional access routes to the National Forest were closed.18 in Wisconsin had serious use conflicts between swim- Recreational opportunities are also threatened mers, pleasure boaters, water skiers, fishermen, when subdividers buy up potential public recreation- sailors, and skin divers.22 al sites. Rising land prices, further inflated by Political Imp . Recreational land develop- recreational land development pressures, have made ment can also have significant political effects on public acquisition of parkland increasing difficult. local communities, depending on rates of permanent In Hall County, Georgia, recreational development occupancy and the extent to which recreational prop- blocked the public purchase of waterfront land erty owners get involved in local affairs. The slated for a county park.19 In Virginia, a strate- merits of such political changes depend on one's gic and unique piece of property under negotiation point of view. Native residents are often reluctant for inclusion in the George Washington National to welcome such changes. However, newcomers to sec- Forest was lost to a recreational land developer ond home communities can prove to be invaluable offering a higher bid.20 Second homes, roads, ski assets to local governments willing to put their slopes, and parking lots now occupy the Site. skills and energies to good use. crowding of public recreational facilities can Th e extent of involvement by recreational prop- also result from increased demands as second homes erty owners in local affairs varies according to grow in number. As crowding increases, conflicting their occupancy patterns and reasons for purchasing recreational activities, such as power boating and the property. A North Carolina study found that 85 222 -878 0 - 7 7 - 7 Fitlllr@ I Primary Residences of Second Home Owners, 1970 00 t Number of Second Home Owners 150,000 75,000 4b 25,000 10,000 1,000 Source: U.S. Department of Commerce, Bureau of the Census, U.S. Census of Housing, 1970 Detailed Housing Characteristics. (Washington: Government Printing Office, 1972). households most involved in their shoreline neigh- the reservoir on which the property is lo- borhoods, cated, water safety, and fire protection.28 The study showed that the problems most important to . . .tended to have acquired shoreline property for their primary residence the surrounding towns and rural communities received. rather than for recreation or invest- the lowest ratings as problems in the eyes of lake- ment purposes, to have higher family incomes, to be living in nonmetropoli- shore households: tan areas, to have had a strong orien- Under 15 per cent of the respondents con- tation toward such water-based recre- sidered the quality of local schools, rural ational activities as boating, fishing, poverty, availability of recreation facili- and swimming before acquiring,shoreline ties, traffic, or race relations to be very property, and to have heads who have serious or fairly serious problems in the better educations and who are employed "broader community" near their shoreline in professional and managerial occupa- property.29 tions.23 Similarly, a study of lake property owners in Permanent occupancy in second home.developments Wisconsin showed that those property owners who can result in significant political changes, as an participated rmst in their second home property increasing proportion of new residents begin taking owners' associations tended to be living in their an active part in the affairs of local government. second homes more, to be more highly educated, and In Wilmington, Vermont, where the skiing and second to have their permanent residences closer to their home industry has caused substantial permanent popu- recreational property than less-active second home lation growth, newcomers to the community hold the owners.24 majority of political posts. In 1973, only one of . Unimproved recreational subdivisions with Wilmington's three selectmen was a native.ok the little buildout have few, if any, immediate politi- town; the other two had been there for five and cal effects on local coimnunities. But they have eight years.30 Of the nine members of the planning commission, only three were natives. Of the five caused some apprehensions that outsiders would move in and dictate growth and development policies in members of the zoning board, only one was a native. the future.25 In New Mexico, for example, where All the members of the Board of Civil .Authority, all recreational lots already outnumber the total exist- the justices of the peace, and all the tax assessors ing state population, residents in some parts of were non-natives. In contrast, all local office the state are concerned about the future allocation holders were natives of the area in the nearby town of water rights as political constituencies change of Whitingham, where little second home development with the immigration of more and more families into had occurred. recreational subdivisions.26 Pasco County, Florida, is an extreme example I Involvement in local affairs tends to also be of political impact due to growth. From.,,1960 to low in second home areas where occupancy is mostly 1973, Pasco County's population grew from 33,000 to seasonal.27 Most second home owners come to the 108,000.31 Most of this growth was caused by re- country to relax, not to get involved. They are tirees moving into the county from Northern Cities. primarily active in their first home communities As a result, county government did a political about- where they work, shop, vote, and send their child- face within a few years. Pasco County had always been a Democratic stronghold. No Republican had ren to school. Because of their limited involvement, second home projects have been called "communities ever been elected to the five-member county commis- sion until 1970, when two Republican county commis- of limited liability." This attitude is evident in second home owner's perceptions of rural problems sioners were elected. The balance of power shifted reported in the North Carolina study: in 1972 when two more Republicans were elected to the county commission.32 As a general rule, households tend to per- ceive problems which are highly salient to Obviously, the effects of such a political their individual recreational and proprie- change can be far reaching. Local government prior- tary interests and to be unaware of more general problems common to the towns and ities in Pasco County have shifted to such things as rural communities near which their rec- growth control, mass transit planning and health reation property is located. The five problems perceived most often included care. Retirees have fought to keep industry out of vandalism, refuse disposal, drawdown of the county, and voted down several school bond is- 87 sues.33 In 1971, there was even a referendum held realizing that if others follow, the amenities which on a proposal to relocate the county court house they sought may be endangered. from the county seat in Dade City to the coastal area of the county where the recent growth has oc- Attitudes Toward Social Change curred.34 But such shifts in local government poli- Reactions to these social changes are often cies merely reflect the will of the changing major- emotional and therefore difficult to assess. Some ity, and are the inevitable facts of life in a high- native residents welcome the influx of new people ly mobile, democratic society. with attitudes and lifestyles different from their In some areas experiencing recreational devel- own. Others feel exploited and openly resent these opment, the newer residents take the greatest inter- "outsiders." Many local residents seem torn be- est in protecting the environment and controlling tween a desire for the affluence growth can bring, growth. Long-time residents often have vested in- and a fear of the negative side effects, some of terests in the status quo, and are not eager to see which seem to be the inevitable price of that growth. land use and development regulated. One observer Often local reactions to social change depend more writes: on the scale and speed of that change than on the Paradoxically but understandably, many actual change itself. Coloradans who live amidst the natural On the plus side, some existing residents of glories are upset by talk of control- ling growth to preserve beauty. It second home areas see development as a positive sounds to them like city folks threat- force attracting new people with fresh ideas, as ening to slam the door before the farmers and ranchers and small-town well as creating new economic opportunities. In a residents have shared in the state's California survey, rural young people favored the affluence.35 In Deschusets County, Oregon, new residents moving growth of recreational land development, hoping for into the county within the last five years have been new job opportunities and a wider variety of com- the most outspoken on environmental issues. People mercial, cultural, and recreational opportunities.38 who grew up in the area seem the least likely to many local residents interviewed in Deschutes County, acknowledge the problems implied by further growth Oregon considered the hiqh-amenity resort develop- and development.36 A survey in rural Minnesota ment occurring there an important asset to the com- found that second home owners favor a wide variety munity, partly due to the creation of new recre- of land use controls that the permanent residents ational opportunities open to the general public.39 in these rural areas oppose. The study states: A community college professor in Bend, Oregon noted Few areas have [land use and deve lopment] that the wealthier residents of recreational proj- regulations. Apparently, local people ects in the area had increased the local audience are opposed to them. But seasonal owners for fine arts, making summer theater possible in feel differently. . . . The pro respond- ents, all Twin Cities area residents own- the community.40 And a newspaper editor in Warren ing vacation homes in Crow Wing County, County, Virginia commented on the growth of second favored all of the regulations listed [commercial off-street parking require- home development by saying, ments, junkyard regulations, subdivision It's a good thing that this musty old regulations, sewage disposal system codes, inbred valley is getting some new ideas, land use zoning, time zoning for water skiing, lake area zoning for water ski- people who've seen more of the world than ing, minimum frontage requirements, mini- we have and who have some useful notions mum lot size zoning] by at least a two-to- about how we might do things differently.41 one ratio.37 But feelings toward recreational development The motives of these newcomers to second home run the opposite direction as well. One rural Vir- areas are perfectly clear. Their vested interests ginian stated, are in stopping further growth and change. Each I don't blame them for wanting to get away new resident hopes he will be the last one. from the city, but I don't want them to bring the city out to us.42 Called the "gangplank" or "last-one-in" syndrome, Some native residents feel as if they are being ex- these early arrivals want to pull in the gangplank ploited or "colonized" as the land is subdivided and shut the door on further growth and development, and sold off to wealthier outsiders. Describing 88 the impacts of development on the Massanutten Moun- victims of such things as high-pressure sales tactics, tain area of Virginia, one writer stated, deceptive and fradulent advertising schemes, and bro- Though the longtime residents of the Massa- ken promises. These problems have been concentrated nutten and its surrounding communities call most in the unimproved recreational lot sector of them 'city people,' they are more often residents of the lower-cost subdivisions the industry, and have involved some of the largest in Washington's suburban counties. They and best known business firms in the country. Today, have repeopled the mountain in some places and restructured its society in others, thousands of scattered recreational lots lie idle bringing money and new blood to many long and unimproved, many for sale, many others abandoned somnolent communities. But in so doing they have triggered economic, social and and tax delinquent. environmental changes that trouble many Consumer Complaints. Complaints of consumer long-term inhabitants.43 While pleased with some of the development victimization in recreational land sales have long which has taken place to date, three-fourths of the been a serious national issue. As early as 1964, respondents to an opinion survey conducted in Des- Senate hearings into "interstate mail order land chutes County did not want any further recreational sales" were conducted by the Subcommittee on Frauds subdivision there.44 Yet many residents considered and Misrepresentations Affecting the Elderly, com- further development inevitable, and had property of piling hundreds of pages of testimony documenting their own up for sale. One local realtor remarked industry practices.48 The Interstate Land Sales Full that few people really wanted to see the area change Disclosure Act of 1968 grew out of these Senate hear- very much, but they considered it inevitable, and ings, creating the Office of Interstate Land Sales besides, if it was going to happen anyway, there Registration (OILSR), the federal agency charged was a lot of money to be made from land sales.45 with regulating the recreational land industry. These feelings of colonization may be most pro- During the summer and fall of 1972, OILSR con- nounced on Indian reservations where several major ducted a series of public-hearings in 17 major cities recreational land developments have occurred through "to hear complaints from consumers about interstate the use of long-term lease agreements. In develop- land sales practices."49 The problems of the 60's ments such as Colonias de Santa Fe on the Tesuque had by no means disappeared. Attended by a total of reservation in New Mexico, Great Western Corpora- over 5,000 people, 360 people testified making a tion's Conchiti Lake on the Conchiti Pueblo (also total of some 800 allegations of abusive and unfair in New Mexico), and Legend Lake on Monominee-owned practices by land sales firms.50 land in Wisconsin--the clash between cultures could During the last half of 1973, OILSR received hardly be greater. One observer described develop- 1,500 unsolicited letters per month from consumer s, ment on the Conchiti reservation as follows: over half of which were complaints against land sales For 400 years the Conchiti have lived firms.51 Most of these complaints involved broken here as drum makers and subsistence promises made by the companies. Many were from pro- farmers, their culture largely intact spective consumers investigating companies before because the land remained theirs. . . . Soon, according to Great Western, there buying land. Others were from people who had already will be streets, shopping centers, hotels bought land but were investigating the sellers fur- and homes for more than 50,000 people at Conchiti Lake--almost none of them Indian, ther, apprehensive about their purchases. When News- of course, and certainly none of them week magazine published an article on recreational Conchiti Indians because the minimum cost for a new home at Conchiti Lake will land sales in 1973 and mentioned the availability of be something more than $30,000. Most a pamphlet on consumer protection, OILSR was swamped Conchiti do not earn that much in a life- time.46 with 10,000 requests'during the following two weeks.52 Several surveys have documented consumer dis- Consumer Victimization satisfaction further. In a survey conducted by the Consumer victimization in land sales has prob- Christian Science Monitor in 1973, 43 per cent of ably been the most widely publicized and best known the lot buyers responding answered that they were impact of the recreational land sales industry.47 '.generally dissatisfied with their deal."53 Fifty- Hundreds of thousands of consumers have been the five per cent of the respondents to a survey in 89 Siskiyou County, California stated that their re- County district attorney plus three class cently purchased lot in a recreational subdivision action lawsuits filed in state courts and two in federal courts. had not fully met their expectations.54 A Govern- ment Accounting Office study of both the industry The suits charged that the company had not provided the promised recreational facili- and OILSR included a survey of 2,000 recreational ties, had misrepresented the value and in- land buyers, and found that 28 per cent of the 650 vestment potential of the land, given false information about plans for access roads and respondents were dissatisfied with their pur- highways. They also charged that sales per- chases.55 Their most common complaints included sonnel had used two-way radios to imply that lots were selling fast.60 the developer's failure to deliver on promised im- In the end, Boise agreed to a $58.5 million settle- provements, deceptive sales practices, poor invest- ment, setting up a $24 million fund to cover the ment potential of the property, failure of devel- cost of refunds to buyers who wanted their money opers to provide adequate utility services, financ- back, and reserving another $21.5 million for admin- ing irregularities, property use restrictions, and istrative and maintenance costs and $13 million for excessive real property taxes. In another survey, completing promised improvements in the projects.61 recreational lot owners were asked if they would Beyond outright fraud, industry advertising and make the same decisions to buy their property over promotional techniques have also been a major sore again knowing what they know now. Two-thirds of spot with consumers. Many disgruntled lot owners the respondents said they would not.56 were never all that interested in owning recreation- Causes of Consumer Victimization. There are al property in the first place. They were victims several reasons for all the troubles consumers have of the "hard-sell." The recreational land industry had with recreational property. Misrepresentation has become notorious for some of its advertising and and fraud practiced by land sales firms have been promotional schemes. some of the most serious causes. In 1967, the Gulf Free dinners (complete with slide shows and American Corporation [now General Acceptance Prop- promotional pitches), and gifts for visiting develop- erties, Inc.] pleaded guilty before the Florida ments have been popular techniques used to attract Land Sales Board,on charges of fraudulent sales potential customers.62 Robert Cahn describes promo- practices.57 Sales were suspended for 30 days and tional dinners in a Christian Science Monitor arti- the company was fined $5,000. In addition, they cle: were ordered to refund the money to anyone affected One of the most popular sales devices is the by the 1,300 cases of land switching in Collier free dinner party, usually given in a small County, and another 600 cases in Lee County, to banquet room of one of the good restaurants or hotels of a city. The guests, whose in- which the company admitted. In November, 1972, a terests were whetted by direct mail or tele- U.S. District Court found Missouri Developer Robert phone, come with the expectation of hearing a sales presentation. V. Steinhilber guilty on a two-count indictment of lying about the availability of water facilities in What they are not prepared for is the intens- ity and skill of the sales pitch. The opera- his project.58 tion is based on getting the prospects' sig- One of the most widely known fraud cases in natures on a sales contract before they have time to think about whether it meets their the industry involved the series of suits brought specific needs.63 against Boise Cascade. Late in 1971, the state of The intensity of such sales pitches is the key to California won a temporary restraining order many land sales which otherwise might not have oc- against the Boise land sales subsidiaries on the curred. Another writer describes these tactics in grounds that the firm's salesmen-bad used fraudu- more detail: lent sales tactics at several projects.59 Six law- If the prospect balks, however, the sales suits were finally brought against the firm charg- person is taught a number of strategies to get him to cross over to the promised ing misrepresentation in land sales in 19 subdivi- land. The sales person is cautioned never sions in California and one in Nevada. - to give up on a prospect as long as he can grasp at any excuse to keep the conversa- . . .The suits included civil actions tion open, counting on the prospect's re- filed by the California attorney gen- sistance giving out before the salesman's eral's office and the Contra Costa store of reopening gambits. As the sales 90 manual for the California promotion begun able to do any sort of comparison shopping. A study by N.K. Mendelshon put it, 'Ninety per from Minnesota reported that some firms had been cent of the people buy because they lack the courage to continue saying no.,64 able to "greatly" inflate the selling prices of Another promotional technique involves flying lakeshore property due to the buyer's inability to consumers to the site itself. As early as 1966, compare prices. Gulf American Corporation was flying prospective One example of this is the Fort Mille Lacs customers to their projects in-15 company-owned Development on the west shore of Mille Lacs Lake. Off-lake lots were priced at about aircraft.65 During the winter months, freezing $2,500 each. This price bears no relation- ship to comparable land outside of, and prospects from Minneapolis, Chicago, and Cleveland near to, Port Mille Lacs. One salesman have been invited down to the sunny Southwest for stressed the scarcity of lakeshore property an all-expense paid holiday and a tour of a recre- when selling inland lands, a dubious appeal when more than half of Minnesota's lakeshore ational subdivision. Other promotional techniques remains undeveloped.71 have included telephone solicitations--"boiler Unexpectedly high costs of improving recre- rooms" using WATS lines to generate several thou- ational lots as homesites in some cases have also sand calls per day to potential customers.66 been a source of consumer problems. Often as little The ULI survey questioned developers on the as one-third of the total sales price of lots have most effective promotional techniques used. Com- represented initial investments in land and improve- mercial advertising via radio, TV, and newspapers ments. This has been in large part due to the fact ranked highest. On-site sales were considered the that so much of the developer's initial investment second best method.67 ALDA reported that news- has been spent on,soft costs (advertising, promotion, papers and direct mail advertising were the two administrative overhead, etc.) rather than on hard most successful techniques used by their members.68 costs such as land acquisition, engineering and In a California survey of recreational lot buyers, site design, and installation of improvements and the initial contact in most cases was made by mail facilities. In the early days of the recreational advertising.69 land boom, many land sales firms operated on a for- , Consumer victimization has also resulted in mula which distributed gross sales prices for lots part from the consumer's own lack of knowledge of roughly into three categories: one-third for land the real estate business in general, and the speci- acquisiton and site improvements, one-third for ad- fic market in question. Results from a survey in vertising and sales costs, and one-third for pro- Northern California found that the large majority fit.72 The 1973 AIDA survey reported that 45 per of recreational lot buyers rated their prior in- cent of the average gross sales in recreational vestment experiences as below average; and over land was spent on soft costs. One-third was spent half of these had no prior experience in real es- on sales commissions, sales overhead, advertising, tate investment at all.70 Besides the information and promotion.73 The ULI Survey reported lower necessary to make an intelligent investment deci- figures; soft costs accounted for 36.3 per cent of sion is often difficult for the buyer to obtain-- gross sales, with 25.6 per cent spent on sales and information such as environmental hazards which the advertising.74 land may be subject to, the actual costs of instal- Often having paid relatively high prices for ling improvements to make the lot usable, and the unimproved lots, many consumers have been unable to costs of public services and the conditions under afford the improvements necessary to make their lots which they may or may hot be provided by the local usable as homesites. The remoteness of some of authorities. these projects has made improvements even more dif- Many lot buyers live hundreds of miles from ficult and costly. One study investigated the their purchases, and know little about the particu- costs of improving a recreational lot in a Colorado lar real estate markets in which they are shopping. subdivision.75 For power, a gasoline generator Millions of acres of land in Arizona and New Mexico costing between $900.00 and $1,300 was recommended. have been sold to people in New York, Detroit, and No electrical lines from the local power company Chicago who never visited the property and were un- were available yet, and their installation would 91 cost $5,000 per mile. For sewage disposal, a sep- systems, lot prices have relatively little tangible tic tank would have to be used at an average cost value behind them. of about $800. For water, the lot owner would have For example, G.A.C. Properties of Arizona, to drill his own well at a cost of from $6 to $8 while attempting to have the tax value of its Rio Rico lots reduced, stated that ap- per foot for a well anywhere from 100 to 250 feet proximately 49% of the projected future deep. Telephone lines were not available in the value'(i.e., the developer's sale price) of the land parcel value was based on promotion area, and installation would cost about $400 per costs. Considerable time must pass and many mile. real improvements put in before 'value' is equal to the original sales price.79 Recreational Land as an Investment. Much of Not surprisingly, resale experiences of many the negative impact of the recreational land devel- recreational lot buyers have been dismal. In seven opment business on consumers can be traced to the major recreational subdivisions located in Arizona heavy emphasis placed on the "investment potential" (including such well known projects as Arizona City of recreational property. It has been estimated and Rio Rico),resale prices for lots have averaged that between one-third and one-half of the consurn- from a low of 61 per cent to a high of 88 per cent ers of recreational lots have been primarily seek- of their original sales price.80 A random sampling ing speculative investments, with no intentions of of resale records in Lake'of the Woods, a recreation- ever using their property themselves (see Chapter al subdivision near Washington, D.C., found that the 2). One survey reported the proportion of inves- large majority of lots were sold for less than the tors as high as 70 per cent of all lot buyers in a original pruchase price.81 In one survey of recre- project.76 This yearn for investment opportunities ational lot owners, over half of the respondents had has resulted in considerable consumer disappoint- their lots up for resale, but 85 per cent of these ment, not to mention the needless premature subdi- "expected less than a fair return on their invest- vision of thousands of lots around the country. ment.,,82 For the most part, these small-time specula- For some, finding a buyer at any price seems tors in recreational land are typical American unlikely. Initially, unimproved recreational lots families of average means looking for a bargain. have required 'expensive advertising and promotional They have little experience or expertise in real schemes designed to sell property to a widely scat- estate investment. One expose on the industry tered national market. Individual lot owners have states: "Swamp lands, desert wastes, and other no such resources to help them find successive buy- real estate of dubious value are still sold as 'in- ers for their property. Often living hundreds of vestments' to people of modest means."77 These miles from their property, they have little choice people often disregard the kind of sound reasoning but to attempt to sell their property through a lo- they would normally use for a much less expensive cal realtor. But many local markets either do not investment. A land salesman from one of the major exist at all, or have reached the saturation point. firms in the industry was reported as saying: The plight of many consumers is summed up in this . . . if you keep saying buy, buy, buy, letter from a New Mexico realtor to his client: they'll say, 'I don't want to buy any- thing'; but if you keep saying invest, Dear Mr. [lot owner]: invest, invest, everybody wants to invest, everybody's interested in mak- With regard to your lots 10 and 11, Block 3, ing money.78 Unit 16, 1 am very sorry to inform you that People investing in recreational lots are I have been unable to interest anyone in them at any price. wagering their purchase price against the odds of further improvements being made in the property, The reason is, Mr. that they are located in the main Easterly drainage area without which appreciation is not likely to occur for all the land to the West and North. I to any significant degree. Because so much of the- don't know if you have seen the lots or not, but all the access roads, as well as the lots developer's initial investment is spent on selling themselves, are under water during wet weather. the land (for such things as advertising and pro- Because of the water standing there, the soil motional schemes) rather than on physical improve- is very heavy and when it is wet, not even ments such as adequate streets, sewers, and water four-wheel drive vehicles can reach them. In 92 order to build there, the road would have In some parts of the country, such as Florida and to be built up, as well as considerable the Southwest, local recreational lot markets are fill in the lots. so glutted that independent realtors will not even I am awfully sorry about this, but it is list these properties. Faced with such prospects, impossible to do anything about it. I have shown the lots, but no one is in@ many lot owners have simply stopped making payments terested. on their property, cutting their losses short and Yours very truly, letting the property revert back to the seller or to the local government for delinquent property (New Mexico realtor)83 taxes.84 NOTES 1. Virginia Page, "The Future of Brattleboro," lation, and available in tape form. The Public Reprinted by The Brattleboro Reformer, from Use Sample represents a sample of 2 million its issues of December 4-8, 1972, p. 5. households across the United States. These households were selected from the Basic Records 2. Steve McLeod, "Stowe-Cambridge," The Times- of the 1970 Census of Population to provide Argus, Barre, Vermont. more in-depth detail than available in any pub- lished form. For further information about the 3. James McEvoy, III and Sharon Williams, Visual Public Use Sample, see: U.S. Department of Pollution in the Lake Tahoe Basin: A Report Commerce, Bureau of Census, Social and Economic to the Tahoe Regional Planning Agency, (Davis: Statistics Administration, Public Use Samples University of California, 1971), p. 2. of Basic Records from the 1970 Census: De- scription and Technical Documentation (Washing- 4. Steve McLeod, "Billtown-Breckfield, Morris- ton: Government Printing Office, 1972). ville-Hyde Park," The Times-Argus, Barre, Vermont. 12. Advisory Commission on Intergovernmental Rela- tions, Urban and Rural America: Policies for 5. Ken Ringle, "Land Rush Changes Massanutten Growth, (Washington: Government Printing Of- Rural Life," The Washington Post, Tuesday, fice, 1966), pp. 20-28. September 4, 1973. 13. Niles M. Hansen, Rural Poverty and the Urban 6. Sheafe Satterthwaite, Leisure Homes in the Crisis: A Strategy for Regional Development, Berkshires (Williamstown, Massachusetts: (Bloomington, Indiana: Indiana University Center for Environmental Studies, Williams Press, 1970), pp. 33-34. College, 1969), p. X. 14. Advisory Commission on Intergovernmental Rela- 7. "Crime, Drugs Up When Rural Land Developed," tions, Urban and Rural America: Policies for St. Lawrence Plain Dealer, September 6, 1972, Future Growth, op. cit., pp. 20-28. Canton, New York. 15. Interview with Lorrin Morgan, Planning Director, 8. James C. Thompson and Gordon D. Lewis, "Rural Deschutes County, Oregon, August, 1973. Residential Development on Private Land in the Mogollon Rim Area of Arizona," (Fort 16. Shaefe Satterthwaite, Leisure Homes in the Collins, Colorado: Rocky Mountain Forest and Berkshires, op. cit. Range Experiment Station), unpublished mono- graph. 17. Interview with Lorrin Morgan, op. cit. 9. American Society of Planning officials, "Survey 18. Interview with Charles Huppuch, George Washing- on Recreational Land Development," Unpublished ton National Forest, Warren County, Virginia, survey on local land use and development regu- April 25, 1973. lations affecting recreational land develop- ments, conducted by the American Society of 19. Interview with Clevis Cooper, Chairman, Hall Planning Officials, 1973. Comments made by County Planning Commission, Gainesville, Ga., questionnaire respondents. August 6, 1974. 10. T.E. Dickison and W.E. Johnston, "An Evalua- 20. Interview with Charles Huppuch, op. cit. tion of Owner's Expectations of Building With- in Remote Rural Subdivisions: Impacts on the 21. Steven M. Born and Douglas A. Yanggen, Ender- Rural Community," Paper presented for the Joint standing Lakes and Lake Problems (Madison: Annual Meetings of the American, Canadian, and Upper Great Lakes Regional Commission, 1974), Western Agricultural Economics Association, p. 27. Edmonton, Alberta, August, 1973, pp. 11 and 29. 22. Jon A. Kusler, Farnum Alston, Guy Phillips, 11. The most complete data available on the socio- Don Dowsky, John Muraski, and Laran Gilbert, economic characteristics of second home owners Rural Land Use in Wisconsin: A Preliminary is found in the unpublished Public Use Sample Description of Problems and Preventive Efforts, of Basic Records, from the 1970 Census of Popu- (Madison: institute for Environmental Studies, 93 University of Wisconsin, December, 1972), 39. Interview with Lorrin Morgan, op. cit. p. 86. 40. Interview with Ray Hatton, Central Oregon Com- 23. Raymond J. Burby, III, Household Decision munity College, and Planning Commissioner, Processes in the Purchase and Use of Reser- Bend, Oregon, August, 1973. voir Recreation Land (Chapel Hill, North Carolina, 1971), p. 127. 41. Interview with Edward T. Bromfield, Jr., Editor, Warren Sentinel, Front Royal, Virginia, Septem- 24. Lowell L. Klessig, Lake Property Owners in ber 27, 1973. Northern Wisconsin, op. cit., pp. 112-146. Also see Lester H. Bagg, Carolyn Lebsock, 42. Ken Ringle, "Land Rush Changes Massanutten and Richard Lee Ragatz, The Role of the Rural Life," op. cit. Absentee Property Owner in Community Develop ment, (Ithaca, New York: Department of Con- 43. Ibid. sumer Economics and Public Policy, Cornell University, 1 July, 1973), p. 45-58. 44. Interview with Lorrin Morgan, op. cit. 25. Fred R. Gross, New Mexico State Senator, Albuquerque Journal, undated material from 45. interview with Everett Turner, Central Oregon the files of the Central Clearing House, Board of Realtors, Bend, Oregon, August, 1973. Santa Fe, New Mexico. 46. Robert A. Jones, "Selling the Mirage: A Nice 26. Interview with Brant Calkin, Director, Central Piece of Desert," The Nation, Vol. 213, No. 20, Clearing House, Santa Fe, New Mexico, August, December 13, 1971, pp. 1 616-618. Also see 1973. Anthony Wolff, "Subdividing the Reservations," Planning, December, 1973, pp. 19-23. 27. Raymond J. Burby, III, Household Decision Processes in the Purchase and Use of Reservoir 47. Several recent books include detailed accounts Recreation Land, op. cit., p. 127. of consumer problems in recreational land sales: (1) Anthony Wolff, Unreal Estate, San Francisco: 28. Ibid., p. 144. Sierra Club, 1973; (2) Morton C. Paulson, The Great Land Hustle, Chicago: Henry Regnery _Eom- 29. Ibid., p. 133. pany, 1972; (3) Vince Conboy, Expose: Florida's Billion Dollar Land Fraud, Naples, Florida: 30. Interview with William Nelson, Deerfield Val- Vince Conboy, 1972; and (4) Leonard Downie, Jr., ley correspondent, Battleboro Reformer, Wil- Mortgage on America, New York: Praeger Publish- mington, Vermont, August 15, 1973. ers, 1974. 31. Lucy Ware Morgan, "Pasco Population: 107,750," 48. Interstate Mail Order Land Sales, Hearings St. Petersburg Times, April 21, 1973, p. 1. Before the Subcommittee on Frauds and Mis- representations Affecting the Elderly of the 32. Interview with Matt Prahasky, Pasco County Special Committee on Aging, United States Commissioner, New Port Richey, Florida, Senate, 88th Congress, Second Session, Parts August 2, 1973. 1,2, and 3, (Washington: Government Printing Office, May 18-20, 1964). 33. Interview with William Wiley, Planning Direc- tor, Pasco County, Florida, August 1, 1973. 49. Anthony Wolff, Unreal Estate, op. cit., p. 264. 34. Interview with Richard Morgan, North Suncoast 50. Testimony of George K. Bernstein, Interstate Bureau Chief, St. Petersburg Times, New Port Land Sales Administrator, U.S. Department of Richey, Florida, August 2, 1973. Housing and Urban Development, before the Sub- committee on Housing, House Committee on Bank- 35. Juan Cameron, "Growth is a Fighting Word in ing and Currency, May 1, 1973, p. 2. Colorado's Mountain Wonderland," Fortune, October, 1973, p. 157. 51. Interview with Allen Kappeler, Office of Inter- state Land Sales Registration, U.S. Department 36. Interview with Bill Ellis, The Bulletin, Bend, of Housing and Urban Development, January 24, Oregon, August, 1973. 1974. 37. Robert W. Snyder, "Vacation Homes, Economic 52. Ibid. Development and Local Government Policy in Rural Minnesota," Minnesota Agricultural Eco- 53. Robert Cahn, "What You, the Reader, Say Should nomist, No. 519, (S@. Paul: Agriculturel Ex- Be Done About Land Sales," Christian Science tension Service, University of Minnesota, Monitor, April 6, 1973, p. 9. 1969), pp. I and 4. - 54. T.E. Dickinson and W.E. Johnson, "An Evalua- 38. School of Architecture and Urban Planning, and tion of Owner's Expectation s of Building With- the Environmental and Engineering Program, in Remote Rural Subdivisions: Impacts on the Facing the Future: Five Alternatives for Mam- Rural Community," (Paper presented for the moth Lakes, (Los Angeles: The University of joint annual meeting of the American, Canadian, of California, 1972), p. d. (Preface). and Western Agricultural Economics Association, Edmonton, Alberta, August, 1973). 94 55. Government Accounting office, Comptroller data obtained from the author, Department of General of the United States, Report to the Agricultural Economics, University of California, Congress, Need for Improved Consumer Protec- Davis, 1972. tion in Interstate Land Sales, (Washington: Government Printing Office, 1973) p. 22. 71. John Borchert, Minnesota's Lakeshore: Resources, Development, Policy Needs (Minneapolis: Univer- 56. Anthony Wolff, Unreal Estate, M. cit., p.160. sity of Minnesota, Department of Geography, 1970), . 1970), p. 14. 57. Vince Conboy, Expose: Florida's Billion Dol- lar Land Fraud, op. cit., p. 80. 72. Interview with Carl Burlingame, Editor, Recre- ational Land Leisure Housing Report, April 17, 58. HUD-No. 72@620, Wednesday, November 8, 1972. 1973. 59. Rodgers, William H., Jr., "Boise Cascade: The 73. American Land Development Association, The Land One That Didn't Get Away," The Washington Industry Survey, 1973., op. cit. Monthly, November, 1972, p. 50. 74. "Survey of Recreational Land Developers and 60. "Boise Cascade Agrees to $58.5 Million Settle- Their Projects," Richard L. Ragatz and the ment of Land Sales Lawsuits," House and Home, Urban Land Institute, op. cit. February, 1973, p. 25. 75. William K. Reilly, Editor, The Use of Land: A 61. Ibid. Citizens' Policy Guide to Urban Growth, A Task Force Report Sponsored by the Rockefeller 62. Robert Cahn, "Caution: Land Salesmen at Work," Brothers Fund, (New York: Thomas Y. Crowell Christian Science Monitor (January 19, 1973), Company, 1973), p. 269. P. 9. 76. William K. Reilly, Editor, The Use of Land, 63. Ibid. op. cit., p. 264, 266. 64. Anthony Wolff, Unreal Estate, op. cit., p. 69. 77. Morton C. Paulson, The Great Land Hustle, 2R. cit., p. 158. 65. Morton Paulson, The Great Land Hustle, Op- cit-, P. 19. 78. Anthony Wolff, Unreal Estate, op. cit., p. 68. 66. Robert Cahn, "Caution: Land Salesmen at Work," 79. Erich K. Bleck, "Merchandising Remote Subdivi- op- cit- sion Lots in Southern Arizona," Arizona Re- search, Vol. 21, No. 8-9, August-September, 67. "Survey of Recreational Land Developers and 1972), p. 14. Their Projects," Unpublished survey conducted for this study by Richard L. Ragatz and the BO. Erich K. Bleck, "Merchandising Remote Subdivi- Urban Land Institute (Washington, 1973), n.p. sion Lots in Southern Arizona," op. cit., p. 14. 68. American Land Development Association, The 81. Morton C. Paulson, "Reselling Land: Profits Land Industry Survev, 1973,(Washington: Ameri- Rare for Second Home Sites," The National Ob- can Land Development Association), n.p. server, April 20, 1074, p. 8. 69. T.E. Dickenson and W.E. Johnston, "Remote Rec- 82. Anthony Wolff, Unreal Estate, op. cit., p. 160. reational Subdivision Study," (Unpublished study, Davis, California: Department of Agri- 83. Letter from Seldon Baker, Broker-Realtor to cultural Economics, University of California, William F..Reese, Hopkins, South Carolina, 1973), n.p. February 23, 1971. 70. Warren E. Johnston, "Remote Recreational Subdi- 84. American Society of Planning officials, "Survey visions in Northeastern California" Unpublished on Recreational Land Development," op. cit. 95 CHAPTER 6 PUBLIC REGULATION OF RECREATIONAL LAND DEVELOPMENT The major governmental response to the various Developers have frequently souaht out rural areas impacts of recreational land development has been a which had the least regulatory red tape to wade flurry of federal and state laws to protect con- through.1 As a result, numerous recreational subdi- sumers. But the host of environmental, economic, visions and second home projects have been developed and social impacts of development have posed with little public scrutiny. equally, if not more serious problems for other State governments have begun reclaiming an in- groups besides consumers, especially the rural host creasing share of the responsibilities for control- communities in which development has occurred. ling land development, pHmarily due to the lack of This chapter reviews regulatory trends in the local, adequate regulation at the local level, and the in- state, and federal response to recreational land creasing awareness of environmental problems which development, concentrating on land development regu- are of greater than local concern. Some state con- lations controlling the location and quality of trols, such as environmental impact requirements, development, and also sections on federal and have had direct effects on recreational land devel- state consumer protection measures. opment. Other controls have affected development Most of the serious impacts of recreational indirectly, most notably by protecting or preserving land development can be traced to two major factors: critical environmental areas which are often under the location of development, and the quality or heavy pressure from recreational land development. level of standards at which projects are con- But in spite of increasing state involvement in land structed. The most glaring environmental problems use regulation, local governments still bear the are usually the result of development occurring in brunt of the responsibility. the wrong place, the inadequacy of project improve- No federal legislation besides the 1969 Inter- ments, or both. Economic impacts also hinge on the state Land Sales Full Disclosure Act has been en- location and quality of projects. Remote locations acted in direct response to the adverse impacts of make public services more costly to deliver. In- recreational land development. However, a number of adequate site improvements mean that lot owners, federal laws, such as the National Environmental the general public, or both, will have to pay the Policy Act and the Coastal Zone Management Act have costs of improving or repairing these facilities in had some indirect effects on development. the future. Location and quality are also big fac- tors affecting the consumer; failure to deliver Local Regulation .promised site improvements is one of the major con- Cities, and to a lesser extent counties, have sumer complaints against recreational land devel- traditionally regulated the use of land and set opers. Consumer protection could be substantially development standards within the exercise of their improved if more attention was paid to the quality police powers to protect the "health, safety, and of the products being marketed. general welfare" of the public. Zoning ordinances, Controlling these problems has traditionally subdivision regulations, and health and structural been the responsibility of local government through codes have long been the key tools for controlling land use and development regulations. However, the development. For better or worse, these regulations areas of the country where recreational land devel- have been the nation's first line of defense against the adverse environmental, economic, and social im- opment pressures have been the greatest are the same areas of the country which have had the weak- pacts of urbanization in metropolitan areas. est development regulations. Many rural govern- Local Regulatory Problems. Most of the major ments had few or no regulations whatsoever when the negative environmental and economic impacts of rec- reational land development can be directly attri- recreational land boom hit. Many still have none. buted to problems with land development regulations 97 at the local level--the lack of regulations, weak 25 per cent of the non-metropolitan counties as op- regulations, and poor administration and enforce- posed to 51 per cent of the metropolitan counties. ment. Professional staff assistance is often non- Only 48 per cent of the non-metropolitan counties existent or insufficient. And many communities reported that they performed any planning functions, have misunderstood the potential impacts of devel- as opposed to 76 per cent of the metropolitan coun- opment, thus making regulatory decisions they later ties. Zoning and subdivision regulations occur even regretted. less frequently in the unincorporated portions of Lack of Regulations.--The recreational land counties. In 1971, zoning existed in the unincor- development boom caught many rural governments porated areas of 39 per cent of the nation's coun- totally by surprise, without any controls over land ties; subdivision regulations governing unincorpo- use and development standards. In a survey of lo- rated areas existed in only 25 per cent-of the coun- cal,regulatory practices, 70 per cent of the com- ties. munities had recreational lots which had been sub- While many communities are still without regu- divided before any regulations were ever adopted. 2 lations, their numbers are declining. As recently Warren County, Virginia, for example, had no as 1968, less than 24 per cent of all U.S. counties land development regulations of any kind when a few had zoning ordinances and only 29 per cent of all early recreational subdivisions were developed there counties had subdivision regulations.8 A 1973 sur- in the late 1950s.3 In 1966, the county adopted its vey of selected recreational land developers re- first set of subdivision regulations, but only after ported that 69 per cent had encountered zoning ordi- at least 15,000 lots had been platted and recorded nances and 88 per cent had encountered subdivision in approximately 90 recreational subdivisions. In regulations.9 1972, Warren County strengthened its subdivision Structural regulations such as building codes regulations, and in 1973 adopted floodplain controls are also lacking in many rural areas. In Pasco and its first zoning ordinance. Recreational land County, Florida, retirees from the north helped development fell off sharply after subdivision regu- swell the county's population from 33,000 to 108,000 lations were adopted, but the regulations came too between 1960 and 1973. Complaints over shoddy con- late to avoid impacts from the development of lots struction practices finally resulted in local ef- already platted. forts to adopt the county's first building code in In Deschutes County, Oregon, no zoning or sub- 1973. Local officials expected the code to be a division regulations existed until 1970. They had highly amended version of the Southern Standard been adopted back in 1967, but were subsequently Building Code, often criticized as a traditionally voted out along with the county planning commis- weak code in itself.10 In 1970, 27 per cent of all sion.4 Over 70 per cent of Deschutes County is in dwelling units in Deschutes County, Oregon were in public ownership, mostly controlled by the U.S. a "dilapidated or deteriorating condition," yet in Bureau of Land Management and the Forest Service. 5 1973, the county still had no building, plumbing, or Two-thirds of the remaining private land in the electrical codes.11 county has been subdivided into homesites, 70 per Most rural areas still have no structural codes. cent of which occurred as recreational subdivisions In 1971, a survey of county governments reported (over 20,000 lots) between 1960 and 1970--before only 21 per cent of all responding counties as hav- local regulations were in effect. 6 ing any "code enfo'rcement."12 Forty-two per cent of Warren and Deschutes Counties are not unique. the metropolitan counties had codes, while only 18 As recently as 1971, a survey of one@third of the per cent of non-metropolitan counties had them. And, nation's counties showed that only 41 per cent of the majority of counties reporting code enforcement the non-metropolitan counties (less than,100,000 activities did so only for incorporated areas (60 population) had zoning regulations.7 The figure per cent), leaving construction in the uni ,ncorpo- for metropolitan counties (over 100,000 population) rated, rural areas unregulated. was 55 per cent. The disparity was even greater This lack of regulation is no mystery. Local for subdivision regulations, which existed in only governments rarely adopt legislation in anticipation 98 of a problem. Only after a problem has occurred In Okanogan County, Washington, as in many are laws passed to avoid further damage. The rural counties, the subdivision regulations only amount and sophistication of local land development apply to projects with lots be low some maximum regulations tend to vary directly with pressures size. In Okanogan County, the maximum is 20 acres. for land development. In remote rural areas of the Developers subdividing property into lots larger country where development pressures have been mini- than 20 acres can avoid filing subdivision plats. mal, there has been little interest in regulations. Other loopholes in the regulations permit the re- There are other reasons for the lack of local subdividing of these 20-acre parcels into four lots, regulations too. One is a deep-seated political also without filing any plats. The Okanogan County resistance to government control over private pro- Planning Director states that, "In effect, subdivi- perty. In most rural communities, the less govern- sions are being created where they would not be mental control the better, especially when it comes allowed under the Platting Ordinance."15 Over to control over the use of land.13 25,000 acres of land in the county have been subdi- Inadequate Regulations-The absence of regu- vided into 20-acre recreational lots to avoid meet- lations accounts for only part of the local regula- ing the requirements of the county platting ordinance. tory problem. Inadequate regulations are also a Unsophisticated zoning techniques in Summit serious problem. In the ASPO survey of local regu- County, Colorado, have allowed recreational devel- lations, over one-third of the respondents reported opment there to ignore environmental constraints: that their regulations were either "less than ade- In many cases throughout the country, resi- quate" or "very ineffective."14 Most regulatory dential zoning is defined as follows: low, medium, or, high density, which usually tools were not designed to manage large-scale proj- means from one to twenty-five units per ects, and consequently ignore many important con- acre depending on the designation and has reached a high of sixty in Breckenridge. siderations. What some communities call subdivi- Blanket zoning such as this is simplistic sion regulations are nothing more than simple plat- and unworkable in mountainous areas where in the same fifty-acre parcel a developer ting laws which only require developers to survey may be confronted with variation in slope, lot lines and roads, and file a plat at the county streams, poorly drained wetlands, thin soils, and exposure, among other concerns. courthouse. Yet, if his parcel is zoned to accommodate J .4 A 4, t w, Ail lie, IN , e-K Si V". % r ;7@ 4* .6 S - Development standards in many rural areas are too lenient, often permitting construction on excessive slopes with weak controls over grading' or the removal of vegetation. 99 a certain number of units per acre he ulations are so new and staff so few, that subdivi- fully expects to develop to that density regardless of environmental limitations.i6 sions sometimes go unregistered, and for that mat- In Wayne County, Pennsylvania, road mainte- ter, unnoticed by local authorities until there is nance has been a problem in some recreational sub- a complaint by a lot owner or an application for a divisions due to their substandard design. Wayne building permit. In Utah, many recreational sub- County's road ordinance only specifies the width of divisions are approved by local governments prior the right-of-way, and contains no standards speci- to determining whether water and sewage systems can fying the quantity or quality of base and surface be provided. Home construction often gets underway materials, as commonly required in most suburban before anyone discovers that these facilities will subdivision regulations.17 In Deschutes County, not be available. According to the Utah Division Oregon, a local newspaper reported that the "recre- of Health, such deficiencies usually result in ational subdivision section of the [Deschutes "permanent health hazards."22 County Subdivision] Ordinance was compromised to Other regulations are often inadequately ad- suit real estate people, the county planning com- ministered and enforced as well. Public health mission and the State Board of Health."18 The regulations are one good example. Enforcement is Ordinance does not require developers to provide generally a matter of state concern--a part of the community water or sewer systems for lots larger state's police powers--and is usually shared with than one acre, even though they are adjacent to local governments.23 In Warren County, Virginia, rivers and streams, or in other low lying areas of a number of recreational lots were unexplainably the county where the level of the water table is approved by local health officials, even though dangerously high. they did not meet current health codes.24 Other Poor Administration and Enforcement-In addi- problems can occur when developers are relied on tion to being substantively weak, many local land to do their own testing and submit the findings to development regulations are poorly administered local officials. Staff limitations often prohibit and enforced. Insufficient staff to handle the anything more than sample testing. As a result, heavy workload is often the major problem. For subdivisions are approved with some individual lots example: which do not comply with the health code. In Tuolumne County, Earl Maqwoode is the Finally, there is the age-old problem of cor- total planning staff. The county now has ruption in government, from which rural govern- 20,000 recreational subdivision lots de- ments are no more immune than any other levels of veloped and Magwoode says, 'We're so far behind, I need at least two years to catch government. Several local officials interviewed up. We are $2 million behind in our road in the course of this study mentioned that corrup- work, and there probably isn't enough water available to meet the demands of the exist- tion had destroyed the effectiveness of develop- ing subdivisions, if they are built up.' ment regulations. Conflicts of interest are com- In Mendocino County the work loads imposed mon where people with land development and real by a single project, Brooktrails, were so estate interests sit on local planning commissions great the developer's engineering company was allowed to pay the county employees and county boards of supervisors. overtime to expedite county technical re- view and authorization.19 A California legislature joint committee on open space lands found that thirty-one In 1968, the National Commission on Urban Problems per cent of the county planning commission- reported: ers in the state have at least a direct beneficial interest in [commission) deci- Less than one-fourth of all the jurisdic- sions . . . [and there] is strong evidence tions attempting to regulate land use and that planning commissions, as presently building practices have any full-time em- structured and regulated, potentially can ployees so engaged, and in only 1 in 9 of be utilized in a manner contrary to public them is such regulation directed by a full- interest. time employee paid as much as $9,000 a year.20 A 1973 survey reported that the national median was Not long after the committee's report was issued, the Riverside County grand jury only two authorized professional planning positions indicted a county supervisor, a planning in city and county planning agencies with popula- commissioner, and three developer repre- sentatives on charges of perjury, bribery tions under 50,000.21 In some rural counties, reg- and conspiracy. It is alleged the developer 100 of a proposed recreation subdivision use these recreational lots as homesites, they influenced the county officials through create few impacts, and need little attention or a $3,500 campaign contribution. The supervisor switched his vote to 'yes,' regulation. This analysis is often true, but such making the project vote 3-2 in favor of unimproved land sales promotions are hard to dis- development, according to the allega- tions.25 tinguish from legitimate recreational subdivisions Large recreational land developments create serious which stand good chances of becoming real communi- temptations for local officials, who are often ties. local businessmen as well. For example: Third, because second homes are usually Such projects create another problem thought to be only seasonally occupied, they are in small counties. They create jobs also thought to have much less impact than perma- and they require services that local businessmen would like to supply. nent homes. Developers often argue strongly for So a painting contractor, who is also variances from local regulations on the grounds a planning commissioner, bids and gets a job on a big project in his own that seasonal occupancy creates less impact and county; a county counsel, on his own less necessity for improvements. One local planner time, handles legal matters for a major developer. In a third county, stated, "They [developers] attempt, more than in a real estate man--planning commis- conventional subdivisions, to get you to wave or sioner, halfway through a discussion of a major project, announces he is modify all of your regulations."28 Some of these licensed to sell land for that parti- arguments make sense to the extent that second cular development, and will therefore abstain from voting. All three indi- homes remain seasonally occupied, but no acceptable viduals were open about their relation- method of assuring that they do has been found. ships, and they saw no conflicts.26 Failure to Recognize Development as Urbaniza- Trends in Present Practices. Re creational tion.--Many local governments have not been quick land development has stimulated many local govern- to recognize or appreciate the full implications ments into action. The number of communities reg- of recreational land development, and therefore ulating land development continues to grow each not so quick to adopt regulations to deal with year, often as a direct result of experiences with them. There are several reasons for this. First, recreational subdivisions. Still others have been it is difficult for local officials in rural areas motivated to strengthen existing regulations. to foresee any rapid forms of urban development Conventional Standards-Local governments which have taken steps to regulate recreational In metropolitan fringe areas, where domino urbani- zation has traditionally been the pattern, a com- land development have relied on the conventional techniques of zoning and subdivision regulation, munity could anticipate its own future by looking down the road at what was already happening. But and structural and health codes. Their approach recreational land development is more independent has been generally uniform. The ASPO survey of of cities than bedroom suburbs, and leapfrogs into local regulatory practices conducted for this the hinterlands surprising communities unprepared study reported that 78 per cent of the responding for rapid growth. In Warren County, Virginia, jurisdictions applied the same regulations to rec- just 60 miles from Washington, D.C., some local reational subdivisions as they did to first home officials found inconceivable the suggestion that subdivisions.29 In the negotiation process be- their county could become transformed into another tween local officials and developers, where an Fairfax County (a highly urbanized county to the increasing number of today's development decisions north, closer to Washington).27 are being made, 72 per cent of the respondents Second, in many communities where premature stated that they made no distinctions between recreational subdivisions have occurred, local standards for second and Ifirst home developments. officials have had difficulties taking such devel- The policy adopted by San Diego County provides a opment seriously. They assume that recreational good statement of this common approach: lots are being sold to "suckers back east," none Purpose of whom would really consider moving way out to The purpose of this policy is to indicate the middle of nowhere. As long as no onewants to to the citizens of San Diego County and 101 222 - 878 0 - 77 - 8 subdividers in particular, the criteria local health regulations. In such situations, the which will be applied to developments two sets of regulations are enforced separately, proposed for "second" homes in the moun- tainous areas of the County which lie i.e., subdivisions through the plat approval pro- west and south of AnZa-Borrego Desert cess, and health codes through the issuance of State Park and easterly of a line at the base of the coastal foot hills . . . . building or septic tank permits. In many counties Background in eastern Pennsylvania, for example, the law does Large land holdings have been or are being not prevent subdivisions from occurring on unaccept- acquired by persons interested in provid- able soil. Sewage disposal is controlled on a lot ing the public an opportunity to acquire by lot basis by local health officials at the time parcel of land which can be developed with a "second" home. The County recognizes the property owner applies for a sewage permit.33 the need to provide an opportunity for such As a result, many recreational lots have been sub- recreation oriented developments in the back country, but also recognizes that with divided which are in conflict with local health the passage of time a "second" home has a requirements for water supply and sewage disposal tendency to become a full-time home, and, as such, all public services connected with systems. And again because of the law's silence, full-time residency must be provided for at many subdivisions have been allowed to occur in the time of initial development. some parts of the country with no accessible ground- Policy water. For example, between 1962 and 1972, only It is the policy of the Board of Super- 41 per cent of the recreational lots registered visors that: All development shall con- form to the County of San Diego General with the Utah Real Estate Division claimed availa- Plan as adopted or amended as to land use bility of water.34 and density. If proposed developments conform to the General Plan, the follow- Some local governments have taken steps to ing services and facilities shall be pro- avoid this problem by requiring health department vided and the noted development standards complied with.30 approval prior to local approval of subdivision A local planning director comments on his communi- plats. The Utah County, Utah zoning ordinance now ty.s policy by stating: contains such a provision: Our regulations require that any recrea- where domestic sewage disposal is to be tional subdivision located within our accomplished by the use of individual jurisdiction, provide the same facilities sewage disposal facilities, the suitabil- ity of the land for sewage disposal shall as any "normal" subdivision. We do not be determined by standard seepage tests accept the theory that recreational subdi- before the development is given prelimi- visions do not place all the demands upon nary approval. Suitability of the water local government a normal subdivision supply shall also be determined by standard would.31 water analysis before the development is Public health laws and building codes make given final approval.35 few, if any, distinctions between second and first A number of arguments have been advanced sup- homes. Distinctions are made, however, in enforce- porting the application of the same standards to ment. Local health officials are often lenient both second and first home development. First, with recreational lot owners if they bought their many local governments have found that the impacts property before the regulations took effect. In of second home development are not significantly Deschutes County, Oregon, the local sanitarian's different from those of first home development.36 office has an unwritten policy of making compro- Impacts resulting from construction are similar, if mises on septic tank permits with lot owners whose not identical. Impacts from occupancy and use may purchases predate the regulations--lots which do differ during the early years, but should be con- not meet the new one-acre minimum requirements for sidered on the basis of periods of peak occupancy, on-site septic tanks.32 Also many lot buyers have rather than on the basis of total or average occu- purchased property which never did meet the health pancy. Even though a recreational subdivision may codes, and many local officials are lenient in be heavily occupied during only one season of the. these cases too. The major cause of this problem year, critical facilities such as water and sewer is that in many rural areas, the approval of subdi- systems and roads must be designed to accommodate vision plots is not contingent upon first meeting user demands during periods of occupAncy. 102 Also, second homes tend to become perma- . . . there is no effective way of guaran- teeing that a second home will always be a mently occupied year round, either by their origi- second home. There are more important nal or successive owners. In the ASPO survey of things to do than check on who is living localregulatory practices, the most frequent jus- in a house year-round or on vacation.38 tification for requiring recreational land develop- Utah County, Utah, adopted a zoning ordinance ment to meet the same standards as conventional containing a "Mountain Home Developments" zone de- first home development was that second homes would signed to control the impacts of recreational sub- eventually become first homes, making any signifi- divisions in the mountains by restricting occupancy cant distinction between the two pointless. Sev- to a maximum of 180 days per year.39 Already, how- eral respondents commented on this point: ever, severallot owners have expressed their inten- . . . second home units ultimately become tions of settling permanently in their "mountain first home units. homes," and the county has no practical means of There is no such thing as a second home enforcing the ordinance. Local officials concede subdivision. It may be designed that way, that regulating occupancy has not worked, and in- but in a short time, it is permanent and, therefore, should be treated as a first tend to revoke the ordinance entirely. 40 home development. Variations from Conventional Standards-In Basically . . . experience has shown that spite of the above arguments, some local govern- second homes tend to become first homes sooner or later. ments do make regulatory distinctions between sec- ond home and first home developments. In a few Numerous second homes have now become first homes. Therefore, who is to say instances, local governments have been tougher on what is a second home?37 recreational subdivisions than on first home subdi- Permitting reduced subdivision improvement and con- visions. San Diego County's "Back-Country Subdivi- struction standards for second homes would only sion" policy requires that a proven source of water postpone the need for improvements until some be named, and puts more restrictions on grading in later date when the rate of permanent occupancy mountainous areas. 41 Since many recreational subdi- demanded it. Such an approach would be difficult visions are attracted to sensitive environmental to enforce, and the costs for some improvements, areas, there are good reasons to review them more such as major sewer extensions, could wind up being carefully and often require stricter standards. One borne by the general public. Logic demands that local official states: the developer be required to install all basic im- provements at the outset, of course passing their Initially there is perhaps a more denfensive attitude toward the [second home] project. cost on to consumers in the price of the lots. It is examined much more closely in regard Finally, making major regulatory distinctions to its potential environmental impact, where- as a first home subdivision receives a more between second and first home development is admin- balanced review.42 istratively difficult for local governments. Some Deschutes County has created a "Rural Recreation developers argue that standards should be reduced Residential Zone" conforming to an already well- for second homes minimizing their impacts in other established pattern of recreational subdivisions in ways, such as by restricting.periods of occupancy, the county.43 Minimum lot sizes in this zone are or requiring certain improvements only when homes higher than in conventional urban and suburban are converted to permanent use. There are two ar- residential zones, primarily because of high water guments against this approach. First, as mentioned tables in many of these areas and the dangers of earlier, the most significant impacts are not all groundwater pollution from septic tank seepage. that different, regardless of annual occupancy But these types of considorations focus on the ca- rates. Improvement requirements should be made on pacity of the land itself, not on any particular the basis of density, not occupancy. Second, and forms of development, such as recreational subdivi- even more important, it is administratively (if not sions. All forms of land development in sensitive politically) impractical to enforce a policy limit- environmental areas should.be required to meet,, ing occupancy. As one local official put it: stricter standards to the extent they are necessary. 103 Some communities do relax their development the developer will not usually be around to install regulations for recreational subdivisions. Usually, the facilities, and local governments will be faced this is done by granting special permits or vari- with the often difficult task of asking lot owners ances from existing regulations rather than by to make the capital outlays for the necessary im- adopting separate provisions or standards for rec- provements. In some cases, the lot owners may not reational land development. Street standards are even be able to afford to pay these costs. In other the most frequently relaxed, usually permitting cases, it may be politically difficult to force them less durable surfacing material in anticipation of to cover the entire cost themselves, and the general lower traffic volumes.44 Variances are also com- tax-paying public will have to absorb the difference. monly requested from standards regarding such items In Deschutes County, Oregon, the local planning com- as curbs and gutters, storm drainage systems, side- mission has adopted the policy of not requiring walks, and street lighting. recreational subdivisions to include paved roads.45 There are several common arguments for relax- This policy is based on the fact that it may be ing standards. One is that seasonal occupancy years before any substantial home construction creates lower impacts than permanent occupancy. occurs in these subdivisions. Since the roads are Septic tanks used only seasonally are less hazard- being dedicated to the county, it is cheaper, at ous than septic tanks used year-round. But some least in the short run, for the county to maintain other important facilities, such as central water unpaved roads rather than paved ones. Later, if and sewage systems, must be designed to handle substantial home construction actually occurs, they demands during periods of peak occupancy. Density will face the task of improving roads. and peak loads should be the real determinants of A final argument for relaxing standards for improvement needs, not occupancy rates. The lower second homes is that many conventional subdivision the density, the better the case for relaxing some improvement requirements (such as curbs and gutters standards. Of course, all residential developments and street lighting) detract from the rustic recre- should be required to meet sound planning, engineer- ational environment developers are trying to create ing and health principles based on density and the and consumers are in search of. Where rustic char- carrying capacity of the site regardless of whether acter can be preserved without endangering the envi- they are designed for permanent or vacation use. ronment and project residents, such arguments have Another argument for relaxing conventional merit in some cases. Again, however, variations standards is that major facilities such as central from existing development standards should be based water and sewer systems are not needed during the on sound planning and design criteria depending on early years of a recreational subdivision, since density and carrying capacity regardless of whether so many people buy lots for speculation and do not a project is to be rustic orurban in character, for intend to use them, and since most buyers purchase seasonal or permanent use. , their lots on 10-year installment contracts which The Role of Property owners' Associations- prohibit home construction until the lots are paid Many rural governments are more inclined to grant off and the title has been transferred. If im- variances from existing standards if they are re- provements were installed initially, they would lieved of future responsibilities for maintaining simply sit and disintegrate during the years of project facilities, such as roads, water and'sewer low buildout. But one could argue that if basic systems, and recreational facilities. In some cas- site improvements are not needed at the time the es, local governments have clearly sought to avoid property is subdivided, then by the same token, the their traditional responsibilities by permitting or subdivision is not needed either, since it is being encouraging developers to set up property owners' developed prematurely. associations. These associations are typically non- The important questions for local governments profit corporations modeled after home owners' to consider are who should pay for the improve- associations common in metropolitan suburbs and con- ments, and when is it administratively most effi- dominiums. cient to require installation of facilities? By Delegating quasi-governmental responsibility to the time lot buyers have paid off their contracts, property owners' associations in recreational subdi- 104 visions raises a number of concerns. First, while dents. 49 In California, and elsewhere, some asso- the suburban experience with home owners! associa- ciations have folded, leaving subdivisions with no tions has been largely positive, property owners' controlling entities. 50 when this happens, local associations in recreational subdivisions differ in governments usually have to step in and assume re- several important respects. Homeowners, associa- sponsibilities for project maintenance, as well as tions are made up of permanent residents who are costs. present year-round, and most of whom move into the New Techniques.--New techniques for analyzing project and join the association within a rela- and regulating development are evolving continuously, tively short period of time. On the other hand, such as environmental and fiscal impact analysis, and property owners, associations in recreational sub- flexible zoning controls such as planned unit devel- divisions consist of three distinctly different opment ordinances. Usually, these planning and regu- groups of people with distinctly different sets of latory techniques require increased staff capabili- interests. One group includes speculative lot ties. Most of them are not yet widely used in rural owners who have no intentions of building, have communities, nor even in many urban communities for little interest in the project, and want to minimize that matter. Still, such new techniques offer in- their investments in the property, including main- creased opportunities to better manage recreational tenance fees paid to the property owners, associa- development in the future, and they should be care- tion. A second group consists of second homeowners fully considered. who have built second homes for vacation use, but The environmental impact review process is who only visit the project intermittently and must probably the most important new analytical technique divide their energies and interests between their applied to land development in the 1970's. Some first and second homes. The third group consists consider it the "single most important change in of the permanent residents of the project, often land use regulations since zoning." 51 The EIS out- retirees, who are the most concerned about levels lines the effects of a project on its environment, of project maintenance and the operations of the and enables decision makers to make more informed association in general. These divergent interest choices. Its purpose is to "force full disclosure groups can create*cohflicts over things like set- of the environmental consequences of a propo�ed ac- ting maintenance fees and the use of project facili- tion," and to ultimately inject environmental con- ties, and generally make managing such an associa- siderations into the initial design process. But tion more difficult than in a first home community.46 few local governments apply this review technique In addition, since many recreational properzy to private development projects. California and owners are often non-residents of the area, and non- Washington are two pioneer states where local gov- residents of the state as well, conducting business ernments use the EIS to evaluate private development in any democratic fashion is difficult. It is typi- proposals, as well as public actions. cally hard to get quorums at project meetings, and Santa Cruz County, California has used the EIS some associations have had to conduct much of their process to review several recreational land develop- business by mail.47 Heavy resident involvement is ments. Since environmental impact is the focus of essential for a healthy association, and therefore the process, rather than any particular type of de- less democratic organizational forms than the normal velopment activity, no distinctions are made when homeowners' association (such as the community trust) reviewing recreational land development proposals. might be more suitable for recreational projects.48 The county planning department uses its own staff Finally, there is always the danger that the or commission's consultants to write environmental property owners' association cannot manage its own impact statements, charging developers' fees to affairs or afford the financial burden of maintain- cover the costs. Most communities, however, go no ing the facilities it owns. Experience to date in- further than preparing guidelines for writing state- dicates that these associations have been less ac- ments,requiring developers to prepare the actual tive and less successful than comparable suburban statements. Washington also enacted legislation associations composed entirely of permanent resi- establishing an EIS process for local governments 105 in 1971. Since two court decisions in 1973, the pro- courages more flexible and innovative site design. cess has been applied to private subdivisions, in- it is especially attractive for use in natural areas cluding recreational subdivisions. 52 such as along shorelines or in rugged terrain since Relatively few recreational land development housing can be clustered and important natural fea- proposals (or any other proposals) have ever been tures of the site preserved. turned down due to the findings of an environmental Regulating Old Subdivisions-Even where con- impact statement, however, the process has often re- trols have been implemented there is still the prob- sulted in better project design, which is its pri- lem of avoiding adverse impacts from all the vacant mary intent. Local officials in both Santa Cruz recreational lots created before regulations took County and King County, Washington commented that effect. Warren County, Virginia had 15,000 recre- important design changes had been made in second home ational lots created prior to the adoption of developments through use of the EIS process. 53 subdivision regulations in 1966. Over 20,000 rec- A few rural communities faced with recreational reational lots were created in Deschutes County, land development pressures have attempted to in- Oregon, before subdivision regulations and a zoning corporate considerations for the socio-economic ordinance were put into effect in 1970. impacts of recreational land development into their Seventy per cent of the communities surveyed regulations. Warren County, Virginia has used de- by ASPO contained recreational lots which had been velopment application fees to finance a cost-bene- subdivided prior to the adoption of the regulations, fit study of a recreational land development pro- and which did not meet current minimum standards posal.54 Warren County's study focused on the set forth in those regulations.56 Development pres- fiscal impacts of the project on county government, sures for home construction on these lots have including projections of the taxes generated and occurred in over half of these communities. The the public expenses incurred over time. Such problem local governments face is what to do when studies have also estimated impacts of recreational these requests for development occur. projects on local employment and local business Responses to this problem have varied. In the firms. majority of cases, construction has been permitted Bayfield County, Wisconsin, offers another ex- on recreational lots which p Iredate the regulations ample. This community has amended its zoning ordi- without current standards being met. In other cases, nance to require economic impact statements from compromises have been made. In Deschutes County, subdivisions ot more than 100 lots: recreational lots which predate the zoning ordi- The applicant shall submit with his applica- nance do not have to conform to minimum lot size tion for approval a detailed economic impact requirements, but they must meet standards for statement by competent professional help, such as engineers, land planners, and experts building setbacks and yard requirements.57 Local on government finance, showing the expected officials compromise least on health code require- tax revenues to be paid by the proposed devel- opment to the county, town, and school, util- ments, although flexibility occurs here too. Health ity and sanitary districts, and the cost rea- requirements are usually made retroactive and apply sonably expected to be incurred by them in providing all governmental services required to all vacant lots, regardless of when they were by the development and those who will live in subdivided. Unbuildable lots exist in many parts it.55 of the country because they do not meet local health These types of requirements are used like environ- code requirements for sewage disposal. many of mental impact statements. They provide additional these lot owners will be denied permission to build, information for local planning commissioners and and there is little likelihood that central sewer legislators making project approval decisions, and systems will be installed. Consumers in this pre- can be used to negotiate more acceptable projects dicament must assemble several lots until they have with developers. a parcel which complies with the health code, or The planned unit development (PUD) technique is else sell out. One local planner reports his com- also becoming more common to rural communities. The munity's policy as follows: PUD process permits relief from the monotony and Unimproved substandard lots cannot be built rigidity of conventional zoning provisions, and en- upon unless minimum health department re- 106 quirements are met by combining lots to get right state control. Equally, if not more important [the) required square footage (11,000 square are the new state laws aimed at protecting critical feet) . 58 Another planner reports: natural areas--areas which are often under the great- The lots must meet building code require- est pressure from recre .ational land development. ments regarding water and sewers, i.e., Protecting consumers through land sales laws is also they must be buildable sites, but they do an important state responsibility. not need to meet current subdivision re- quirements.59 Controlling Land Development. State controls Some communities seem to have these priorities of land development have taken both the forms of man- turned around, standing firm on their subdivision dating local regulator y systems as well as direct requirements (building setbacks and yard dimenr state controls over ce.rtain typesof projects, such sions), while relaxing their health codes. as large-scale subdivisions. This same question arises concerning the con- Mandatory Local Controls-Some states (Colo- version of second homes to permanent homes when the rado, Montana, and Oregon) have begun requiring structures in question do not meet current building local governments to adopt regulations backed up by code requirements. over three-fourths of the com- the threat of state intervention if local govern- munities responding to the ASPO survey had second ments fail to act. In 1969, the Oregon Legislature homes which had been converted to year-round resi- passed a law requiring every city and county in the dences; over half of these structures did not meet State to adopt comprehensive land use plans and the current building code requirements for first zoning ordinances by the end of 1971. Although the homes.60 Most of these communities (84 per cent) law authorized the Governor to extend the deadline, reported no regul ations which required any struc- it also allowed him to develop a comprehensive plan tural improvements to be made at the time of con- and zoning ordinance for any city or county con- version to permanent occupancy. Of those few which sidered making inadequate progress. Further, the do try to regulate improvements at conversion (i.e., Governor was given the power to enforce State imposed bringing them "up to code"), most require the owner to regulations with court injunctions against develop- obtain a certificate of occupancy to use a second ment propo sals which violated State regulations. On home as a permanent home. But enforcement of such one occasion, the Governor placed a moratorium on regulations is highly impractical and most of these the issuance of building permits in Lincoln County, structures are only regulated if a complaint is until the county commissioners agreed to complete filed by an adjacent property owner or some other their comprehensive plan and zoning ordinance. In party, or if the owner files an application for another instance, at the request of the Jefferson additions or improvements to be made to the build- County commissioners, the Governor placed a mora- ing. torium on new subdivision plats until the commis- sioners could adopt a subdivision ordinance and com- State Regulations plete a land use plan. Many state governments have broken the tradi- This initial act gave local governments no tional pattern of local responsibility for all land guidelines and no money, both major shortcomings.61 use decisions by enacting a variety of legislation Senate Bill 100, adopted by the 1973 Oregon Legis- giving states more direct control over land use. lature corrected these problems by creating a De- While aimed at all forms of land development, much partment of Land Conservation and Development to of this emerging body of state legislation has a establish statewide land use planning goals and direct bearing on recreational land development. guidelines by January, 1975, and authorized an ap- Some state laws, such as Vermont's.Act 250, have propriation of $2 million to be distributed to been drafted primarily in response to intensive local governments.62 Within one year after ap- recreational land development. proval of the statewide guidelines, all local com- There are two major thrusts of emerging state prensive plans and development-related ordinances legislation which affect recreational land devel- must be in compliance.63 The bill also charges opment. One involves direct controls over develop- the department with issuing permits for activities ment, either by forcing local action, or by out- of statewide significance, including sewer and edu- 107 cational facilities, and with recommending areas of and propose guidelines and techniques for directing statewide concern to a new Joint Legislative Com- future growth. mittee on Land Use. In 1970, Vermont passed the Environmental Con- State governments have strengthened other types trol Law (Act 250) largely in response to the pi:es- of local regulations as well. In Montana for ex- sures of recreational land development. In requir- ample: ing state and regional approval of all proposals The State Department of Environmental and for major residential subdivisions and highways, Health Services is required to promulgate rules and standards relating to adequacy Act 250 requires a series of statewide plans to be of water supply and the quality of sewage adopted as part of the criteria for project review. and solid waste disposal systems for all subdivision developments. No such devel- The first plan was an interim land capability plan opment is permitted without department ap- which described existing land uses in the state and proval, and application for approval must include certain specified information as provided a Preliminary classification of lands to water, sewage and solid waste disposal, based on physical limitations of development, suit- at the approval of the local health offi- cer. 64 ability for agriculture, forestry, or mining, and In 1973, Oregon health laws were substantially the existence of unique or fragile environmental strengthened when sewage disposal approvals were conditions. 69 The second land use plan, the "Capa- assisgned to the State's new Environmental Quality bility and Development Plan," set forth state land Board. 65 The law prohibits any local government use goals and objectives and was adopted in 1973. from approving any subdivision, land partitioning, The final plan, classifies all land as urban,.rural plat or plan until it has received a written ap- residential, agricultural conservation (prime agri- proval from the Environmental Quality Board. This cultural land), resources and agricultural conser- requirement helps to insure that no recreational vation (secondary agricultural and forest lands) or lots can be sold without adequate sewage disposal reserves.70 These plans will provide a policy base facilities, and it also takes some of the political for state agencies and local governments to use in pressure off of local planning commissions. adopting land use controls, and provide general use States have also increased their role in code criteria to be considered in approval of highways enforcement. In 1970, Connecticut became the first and large residential developments, including rec- state to adopt a mandatory, uniformly administered reational land developments. statewide code covering all types of structures, Developments of Regional Impact-Several with Maryland, Michigan, and Minnesota adopting states have adopted legislation to deal with devel- similar codes in succeeding years@66 Several other opments creating greater than local impacts. One states have adopted less comprehensive, statewide example is Florida's Environmental Land and Water codes exempting certain types of structures (e.g., Management Act of 1972. 71 Based in part on the one and two family units) or setting standards only American Law Institute's Model Land Development for particular kinds of units (e.g., manufactured Cole, the two major components of Florida's program structures). Some of these codes are voluntary, regulate developments of regional impact and criti- but the trend is toward mandatory requirements. In cal environmental areas. The law designated the almost every case, they are administered locally, Division of State Planning to prepare a comprehen- although most of the states, like Connecticut, pro- sive state land use plan as a policy framework, and vide a state building code standards committee to created an Environmental Land Management Study Com- hear appeals. 67 mittee to report to the governor and legislature on Statewide Land Use Plans-In addition to mak- strategies for related issues such as local subdi- ing local regulations mandatory, more than half of vision regulations, land sales, development rights, the states have adopted some form of statewide land and tax policies. use plan-68 Although statewide plans vary consider- Under the law, every developer proposing a ably, they generally assess land and water resources, project classified as a development of regional project future needs for these resources, examine impact (DRI) must file a form with the local gov- current land use problems and governmental responses, ernment, the regional agency, and the Division of 108 State Planning, including detailed information on has been to upgrade projects by attaching condi- how the project will affect the region's environ- tions to permits on a case-by-case basis, with mental and natural resources, public facilities, little effect on the location of projects. Special and economy. conditions imposed on developments have included a Partly in reaction to rapidly increasing sec- variety of environmental, economic, and design cri- ond home development on inland lakes, Maine passed teria such as the prohibition of future expansion; the Site Location of Development Act in 1970. requirements for underground utility lines, perfor- Under the act, the State Environmental Improvement mance bonds, landscaping, and road size; and time commission (EIC) is given the power to enforce a limits on construction phasing.73 By late 1973, permit-approval system for all large commercial the state Environmental Board had approved all but developments, including residential subdivisions 64 of the 1,079 applications received, although larger than 20 acres, as well as any other residen- about 80 per cent of the approvals included state- tial projects that would require effluent discharge imposed conditions.74 permission from the EIC. Approval is based on the Environmental Impact Review.--As of April, developer's financial capability, on the impact of 1975, 24 states had adopted an environmental impact the proposed development on -traffic and the natural statement review process.75 The large majority of environment, and on soil suitability of development these acts only apply to the activities of state sites. By the end of 1971 most of the permit ap- governments (such as state road construction and plications processed in Maine were for residential other state public works projects), ignoring private subdivisions. About 83 per cent of the applica- development projects. Some limited measure of con- tions were for the construction of housing, and ap- trol over recreational land development is possible proximately half of these were for seasonal housing. by reviewing state development activities necessitated The connission has approved most of the applica- totally or in part by recreational land development. tions, in many cases attaching additional condi- New York's Environmental Conservation Law, passed in tions improving the quality of the developments.72 1975, requires an EIS for all local government ac- Vermont's Environmental Control Law (Act 250) tions which might have significant effects on the en- established an Environmental Board, assisted by vironment, including the issuance of permits and the seven regional commissions, to review all proposals adoption of local development policies and regula- for large-scale projects in the state. The act, tions. As written, this law could have important in- which includes an incentive for local zoning, re- direct effects on development. 76 Still, the EIS quires state permits for all residential develop- process will have its most significant effects on rec- ment proposals on tracts of land of one acre or reational projects when applied directly to private larger in areas where no local zoning exists. In development proposals Ias in California and Washington. areas with local zoning, state permits are required Protecting Critical Areas. Some of the most im- for developments of 10 acres or more and for subdi- portant kinds of emerging state regulations are those visions of 10 or more lots. Permit applications designed to protect geographic areas with special are reviewed according to 10 environmental criteria scenic, natural, scientific, or historic value. There included in the act. Criteria include findings are many kinds of geographic areas in which no recre- that the proposed development will not result in ational subdivisions should occur, and others in undue water or air pollution; has an adequate water which developent frequently removes land from the supply and will not cause any unreasonable traffic market which might be put to better use serving the congestion or otherwise overly tax the local gov- recreational needs of the public rather than being ernment's ability to provide schools and other subdivided for the private recreational use of a few. governmental facilities and services; will no-,@ have As one local planner put it: an unduly adverse effect on scenic, historic or The greatest problem (with recreational irreplaceable natural areas; and will be in con- land] is the danger that such subdivi- formance with local, regional and state plans. sions will preempt (the] most appealing Since the passage, the main effect of Act 250 natural settings and degrade or destroy 109 them--while at the same time complyin of developing a comprehensive plan for conserving with [local] subdivision regulations.@7 and restoring the coastal environment, including General Critical Area Laws-Many critical implementation procedures. Each regional commis- area regulations are general in scope, designed to sion must submit a comprehensive development plan protect a range of environments such as floodplains, to the state commission, which in turn must present shorelines, wetlands, and mountains. Maine passed a final plan to the legislature for approval or a bill in 1974 providing funds for local govern- amendment. Recreational subdivisions require per- ments to designate critical areas themselves, and mits, like all other projects, and must prove that produce plans for the protection of these areas they will not cause any substantial adverse envi- within half a year of their selection. The act also ronmental effects. New Jersey is another state established a Critical Areas Advisory Board to using direct controls to protect its coastline. assist local governments in identifying areas of The Coastal Area Facilities Review Act@ requires critical concern and to coordinate plans for their approval by the New Jersey Department of Environ- use and protection.78 Under the Environmental Land and Water manage- mental Protection of residential developments con- ment Act, Florida's critical areas legislation al- sistinq of 25 or more units between the shoreline and observable road courses. lows for more state involvement than Maine's act. Other states have opted for local coastline The definition of critical areas is very broad in protection. Washington's Shoreline Management Act the Florida Act, including not only environmental, natural, historical, and archeological areas, but of 1971 requires local governments to prepare com- also areas of major development potential and areas prehensive management plans in accordance with affected by major public investments. Indeed, they state guidelines.82 Subject to state review, they are so broadly defined that the regulations may be are also required to administer a permit program applied to nearly all land use problem areas.79 for all substantial shoreline development (defined The Florida Division of State Planning recom- as development worth over $1,000 with 200 feet of mends boundaries for areas of critical state con- streams, wetlands, and lakes, as well as oceans). The law is administered by the Department of Ecol- cern, details why areas are critical, and estab- ogy, which has the authority to intervene where lishes development guidelines for each specific localities fail to act. area. If the Governor and his cabinet approve an Beach and Shoreland Access Laws-In some area, the local government is given six months to areas, recreational subdivisions and second homes adopt land use regulations based on the state guide- have formed walls of private property along coasts lines. If the local government fails to adopt ade- and shorelines, seriously restricting access to quate regulations, the Division of State Planning prepares the regulations, and may seek court en- public beaches. In most states, the mean hightide forcement if local enforcement is inadequate.80 mark is considered the dividing line between public Coastal Zone Management.--Threatened by a and private beach ownership. Although the fore- variety of development pressures, including recre- shore area is held in trust for the public, private ational land development, most coastal states have ownership of the backshore area often blocks access begun working on programs to protect their coast- and prevents its use. 83 without provisions for lines. The specifics of these programs vary public access being made, these areas can become greatly, but there are two basic approaches--direct "de facto" private beaches for second home owners. state control and state guidance of local planning Oregon, Texas, and California have taken steps to and regulation. prevent this. (The 1976 Amendments to the Coastal California has probably gone the farthest with Zone Management Act, discussed in the section on direct controls.81 With passage of the California federal regulations, include provisions for improv- Coastal Zone Conservation Act (Proposition 20) by ing public beach access.) statewide referendum in 1972, the State Coastal Both Oregon and Texas have open beach laws Zone Conservation Commission and six regional com- which preserve foreshore areas for public use, even missions were established with a three year mandate where backshore areas are privately owned. In 110 addition to establishing a public easement for all A similar public access problem exists along land on the Oregon coast from the extreme low tide. river and lake.shorelines where recreational land to the vegetation line, the law delegates broad development has occurred. In Wisconsin, the water powers to the Highway Commission, permitting them Resources Act of 1966 required counties to adopt to purchase private property contiguous to the regulations for all shoreland in accordance with ocean shore for public access if such access is not standards and criteria developed by the Department otherwise available. They are also charged with of Natural Resources. Included in the standards regulating the use of the ocean shore, controlling are requirements that all new subdivisions Must construction by permit, and regulating the use of provide public access to navigable waters.87 The adjacent public lands, but not private lands.84 law does not remedy blocked access in older subdi- California has adopted several strong measures visions predating the Act, and the state will have dealing with its coastline. In 1970, the state to purchase easements or the land itself at key passed AB 493 which prohibits approval of any access points in older developments. coastal subdivision that does not provide reason- Shoreland Regulations-Providing public able public access from the public highways to the access to navigable waters was only one of the land below the ordinary high water mark, either reasons behind Wisconsin's water Resources Act. within or at a reasonable distance from the subdi- Like other states, Wisconsin also adopted the regu- vision.85 California's Proposition 20 also has an lations to prevent developments from destroying important effect on beach access. In turning down scenic shoreland areas and the quality of adjacent a permit for a single family home in Sea Ranch (a waters. Traditionally, states have regulated pri- second home development) in October, 1973, the vate activities which directly affected public State Coastline Commission indicated that such ex- waters, including dredging and filling, damming, clusive subdivisions would have to take more public and pollution control. At the same time, control- needs into consideration, including the provision of public access to beaches.86 MAL 'Abit'" A V". _71 In many parts of the country, waterfront second homes have created walls of private ownership, hindering public access to streams, lakes, and the coastline. ill ling shoreland uses above the highwater mark has marsh areas which are rarely suitable for building, traditionally been left to local governments. In and permit few uses. The Residential-Recreational recent years, however, a number of states, includ- district includes land amenable to light develop- ing Wisconsin, Minnesota, Maine, Vermont, Michigan, ment, and specifically permits seasonal and year- and Washington, have passed laws requiring local round single-family dwellings. The General Pur- governments to adopt shoreland regulations in ac- pose District, the least restrictive category, per- cordance with minimum state standards. Under these mits most types of development as long as 100 foot laws, the states will adopt regulations for local minimum setbacks from navigable waters are ob- areas failing to comply with state guidelines. 88 served. These zoning classifications are included Shoreland regulations use many of the same techni- in a Model Shoreland Protection Ordinance which ques found in zoning and subdivision controls, such supersedes all county shoreland zoning with the as regulating lot sizes and setbacks from the shore- exception of those sections which are more restric- line, as well as regulating dredging and filling, tive than the model provisions.92 and removal of shoreline vegetation.89 Both the Minnesota and Wisconsin laws contain Minnesota and Wisconsin both have shoreland sections applying specifically to subdivisions. regulations which follow this general pattern. The Wisconsin Model Ordinance contains particularly Minnesota's Shoreland Management Act, adopted in strong measures which prohibit land from being sub- 1969, reauired all counties to adopt shoreland con- divided which is "held unsuitable" by the county servation ordinances meeting minimum state stan- planning agencies for reasons of flooding, inade- dards and criteria by July lr 1972. Recent amend- quate drainage,.soil and rock erosion potential, ments to the Act extended its coverage to shore- unfavorable topography, inadequate water supply or lands in both municipal and unincorporated areas. sewage disposal capabilities or any other features Under the Act, the state is required to impose a likely to be harmful to the health, safety or wel- model ordinance if local governments do not adopt fare of the public.93 acceptable regulations. The minimum state stan- Adirondack Park Agency Act-In a few cases, dards establish a sanitary code, minimum lot states have adopted comprehensive land use con- sizes, building setbacks, and subdivision regula- trols for particular unique areas under heavy rec- tions. While these requirements apply only to new reational land development pressures. The Adiron- subdivisons, existing development must meet code dack Park Agency Act of 1971 is one of the most standards for sewage disposal. 90 comprehensive such measures. Although the Wisconsin Water Resources Act The Adirondack Park covers six million acres of 1966 still applies only to unincorporated areas, of publicly and privately owned forests, lakes and it is otherwise very similar to the Minnesota act. mountains in upstate New York. A popular second It authorizes the State Department of Natural Re- home area since the 19th Century, the park has sources to impose shoreland protection regulations been experie ncing increasing second home develop- in the event counties do not adopt acceptable regu- ment. These development pressures plus the in- lations, and sets down strict criteria regarding ability of many small communities in the Adiron- lot sizes; minimum setbacks for sewage disposal dacks to deal effectively with land use problems, and water supply systems from the highwater mark; led to passage of the Adirondack Park Agency Act maximum clearing of trees and other vegetation; in 1971.94 maximum site coverage by buildings; placement of The goals of the act are both to preserve and roads; and the suitability of land for various use the unique scenic, natural and recreational types of development.91 assets of the park, to develop long-range policy Wisconsin's law provides for three types of based on state-wide concern for the park, and to shoreland zoning classification--Conservancy, encourage local land use planning. To achieve Residential-Recreational, and General Purpose-- these goals, the a.gency prepared the AdirondacIk with different u.se and development standards for Park Land Use and Development Plan which took effect each. Conservancy.districts are mainly swamp and August 1, 1973. The plan classifies all private lands in the park into six land use areas, with com- 112 patible uses and intensity of development specified cated outside of the regulating state but marketing for each area. It aims to preserve the open space land to in-state residents). Registration require- character of thepark by centralizing the most in- ments differ for in-state and out-of-state proj- tense development in hamlet areas, which consist of ects--usually by being tougher on out-of-state de- existing towns with room for growth. Rural use and velopments. Second, several state acts go beyond resource management areas, in which only minor de- the limited intent of full disclosure by including velopment will be allowed, make up 87 per cent of requirements which affect the quality of the de- the private land in the park.95 The plan includes velopment itself, primarily through bonding require- lake and river shoreline restrictions, and a review ments which guarantee that promised improvements and permit system.96 will, in fact, be constructed. At least two states Projects subject to review are classified into (Georgia and New York) require in-state developers two groups. Class A projects are defined as those to post performance bonds, and 15 states make this developments with "potential major impact, [or] requirement for out-of-state subdivisions. near especially critical environmental areas," and Aside from these distinctions, most state land include subdivisions of 100 or more lots in hamlet sales acts have been modeled after the federal stat- areas. Outside hamlet areas, much smaller subdivi- ute in one way or another. All but two (Maine and sions are included in Class A. All Class A projects South Dakota) require property reports to be given must be reviewed and approved by the agency, as well to prospective buyers. Most of them include provi- as local governments if they are located in areas sions for rights of recision, several of which are covered by local land use plans. Class B projects longer than the federal cooling-off period of 48 are those which have some potential, though less hours. (Michigan has a five-day unwaiverable period critical impacts. They are subject to agency re- of recision; California requires a 14-day right view only if there is no approved local land use of recision.) The federal minimum lot requirement plan in effect.97 for filing (50 or more lots) is the highest mini- The location and quality of future recreational mum used by any of the states (with the exception subdivisions in the Adirondack Park will be directly of Minnesota's which is 51 and Georgia's 150 lot affected by the act. Densities typical in most rec- minimum for in-state developers). Many states reational subdivisions will not be permitted on require subdivisions with far fewer lots to regis- much of the park's remaining open lands, and proj- ter; 12 states require registrations from all sub- ects which are approved will have to meet stringent divisions containing five lots or more. environmental measures. As a result, the Adirondack In most cases, developers are required to Park will he preserved as a highly desirable second register with the state, usually with departments home location for those already there, as well as of real estate or real estate commissions. New the limited number of projects which will be ap- Mexico requires registration with the counties. proved in the future. In six states (Alabama, Maine, North Carolina, State Land Sales Regulations.--Consumer pro- Pennsylvania, Tennessee, and Wisconsin) wide dis- tection in recreational land sales is also consid- cretion for registration requirements is granted ered an important state responsibility. As of May, to planning regions, counties, and/or municipali- 1973, 41 states had adopted some form of legisla- ties. These local units of government are allowed tion requiring the registration of land sales of- to formulate their own regulations and require ferings.98 registration with local officials. Six states Most state land sales laws are modeled after (Maine, Minnesota, Missouri, Ohio, Tennessee, and the federal Interstate Land Sales Full Disclosure Vermont) require registration through their securi- Act of 1968 (discussed in the next section), but ties acts. West Virginia requires registration they differ in two important respects. First, many through its Blue Sky Law, and Iowa requires regis- states' lavis differentiate between projects located tration under its Consumer Fraud Act.. in-state, (regardless of where the land is sold), Among the states, there is a great deal of and projects located out-of-state (i.e., those lo- variation in land sales regulations. Seventeen 113 states.regulate only the sale of out-of-state land. Not surprisingly, out-of-state subdividers Eighteen states make some provision for the accept- are scarce in California. But ironically, California's home-grown land hustlers, such ance of federal filings in lieu of state registra- as the California city promoters, flourish tion. Tennessee does not require registration of under much less stringent rules and enforce- ment, and they have the lucrative, land- in-state land with the state but the planning happy California market all to themselves.102 regions may require such registration if they choose New York's law has also been highly acclaimed. to; Maine, on the other hand, delegates its authority Since 1969, the office of New York's Attorney Gen- to register subdivisions to the municipalities. Both eral has been responsible for the return of approx- states require registration of out-of-state land imately "$7 million in restitution for victimized through their securities acts. In Pennsylvania, plan- land buyers.',103 One author states that, "Many ning agencies may regulate in-state development offerings with routine clearance from federal au- while the sale of out-of-state land is regulated thorities have been banned in New York.,,104 through state licensing regulations. State land sales regulations as a whole com- California's regulations governing land sales prise a fragmented maze of widely varying restric- are considered to be among the toughest. Before tions offering consumers generally less overall any land in subdivisions of five or more lots can be protection in the form of full disclosure than do sold, the state real estate commissioner must issue OILSR's regulations. But the bonding requirements a Final Subdivision Public Report informing prospec- of a few key states are important exceptions which tive buyers of important facts about the property.99 go beyond the relatively weak techniques of full Out-of-state developers selling in California must disclosure by providing assurances of developer receive a permit from the State Department of Real performance. Estate. The regulations require an appraisal of the lots in the particular subdivision to determine if Federal Regulations the lot prices are "fair, just, and equitable." The The federal government's response to recrea- appraisal must be made by the department appraiser tional land development has been primarily limited and the cost borne by the developer. The "fair, to consumer protection legislation administered by just, and equitable" provision means that the price OILSR, and other types of consumer protection laws of the land offered must bear some relationship to administered by the Securities and Exchange Commis- the price of comparable land in surrounding areas. sion and the Federal Trade Commission. As a result, "Developers who promise improvements must put up the federal government has had little influence over financial security to guarantee them--usually a the location or substantive quality of recreational performance bond backed by a construction con- land development. tract."100 Lots may not be sold as speculative in- The OILSR has maintained a policy of aiding vestments unless the subdivider submits an economic consumers only through full disclosure legislation, feasibility report which contains "facts sufficient staying well away from any kinds of development to justify" claims made of investment value. standards.105 The unsuccessful National Loan Use California's tough out-of-state land sales law Planning Act (which passed the Senate in 1973, but has forced many developers to ignore the major mar- failed in the House in 1974) would have provided kets that exist there. federal assistance for state land use planning Significantly, many of the largest land programs, and included a number of specific land companies, including GAC Corporation and use problem areas which state plans were to address, Horizon Corporation, have not met Cali- fornia's requirements and are not permit- including large recreational land developments.106 ted to sell there. From September, 1963 unitl the time this book went to press, It also contained an amendment which would have the state did not authorize sales in Cali- required state land use plans to include a program fornia of any subdivided land located in to regulate "land sales or development projects ,107 Florida.10I- However, like most state land sales acts which make other bills aimed specifically at controlling vari- the distinction, the California law Iis not tough on ous aspects of recreational land development have local subdividers. 114 been introduced into Congress, but none have become such as shopping centers and schools, recreational law. facilities, municipal services; current taxes and Some federal initiatives, however, have had copies of audited and certified financial state- important indirect effects.* For example, the ments of the developer for the last full fiscal National Environmental Policy Act set the model year as well as means of financing proposed im- for many similar state acts which have had direct provements in the land.110 A land developer may effects on development. Other federal legislation not use any kind of interstate transportation or such as air and water quality regulations, may be- communication to sell land unless HUD has accepted gin to have increasing impacts on rural land use, his Statement of Record. If HUD accepts the state- but have focused primarily on urban areas to date, ment, the registration automatically becomes effec- and have had little influence on recreational sub- tive 30 days after filing, unless the developer is division activity. While the recreational land notified of filing deficiencies prior to that time. development industry is wary of how emerging feder- The Property Report is an abbreviated version al laws will be interpreted and enforced, so far of the information contained in the Statement of their cumulative effects on recreational develop- Record, and is required by the act to be given to ment have been far more potential than real.108 the prospective buyer either before or at the time Interstate Land Sales Full Disclosure Act. of signing a sales co ntract. Failure to do so en- Several federal agencies have some authority to tities a purchaser to,void his contract. A pur- regulate varying industry practices in recreation- chaser also may void his contract within three busi- al land sales. Key authority comes from the Inter- ness days after entering into a land transaction if state Land Sales Full Disclosure Act (Title XIV of he received the report less than 48 hours before he the Housing and Urban Development Act of 1968, as signed the contract. The Property Report is the amended). The act, administered by the QILSR gives key mechanism for consumer protection--the actual HUD jurisdiction over the sale or lease of lots in method of providing disclosure of pertinent facts any subdivision, to the consumer. In question and answer form, it . . . which is divided or proposed to be covers a minimum of 20 important factsbuyers should divided into 50 or more lots, whether con- tiguous or not, for the purposes of sale know about the land (along with some additional or lease by a single developer, or a group items when specifically required) including: of developers acting in concert. a . .109 - Distances to nearby communities over paved The act is a disclosure law modeled after the or unpaved roads; 1933 Securities and Exchange Act. It requires land - Existence of mortgages or liens on the pro- developers and land sales firms to register their perty; - Whether contract payments are placed in projects with HUD. Developers must pay a fee (based escrow, a special fund set aside to insure on a sliding scale tied to the number of lots being that all payments are applied to the pur- offered, but not to exceed $1,000), along with two chase of the property;. documents: a Statement of Record and a Property - Availability of sewer and water service or septic tanks and wells; Report, which are reviewed by OILSR staff for com- - Present and proposed utility services and pliance with the regulations. The Statement of charges; Record is a highly detailed document calling for - The number of homes currently occupied; specific company and project information including - Soil and foundation conditions which could such things as ownership interests in the land; spe- cause problems in construction or in using septic tanks; and cific physical project information such as topogra- - The type of title the buyer will receive Phy and climate; the status of title to the land and when he will receive it.111 and details on any encumbrances, deed restrictions Not all subdivision offerings are covered by or covenants which the land might be Subject to; OILSR regulations. The act provides for 10 statu- current status of project development such as roads, tory exemptions from registration with HUD, some utilities, and internal or neighboring facilities which require no review or approvali others for which developers can only become'eligible upon HUD's 115 review and approval. Exemptions not requiring re- The regulations implementing the Interstate view and approval by HUD include: Land Sales Full Disclosure Act have been revised Sale or lease of: several times since passage of the act. In 1973, the regulations were revised on the basis of testi- - Tracts of fewer than 50 lots which are not a part of a common promotional sales mony gathered in public hearings in 17 cities. The plan; key changes include the following: - Lots in a subdivision where every lot is A requirement that developers give buyers five acres or more in size; an audited financial statement of the com- - Lots upon which a residential, commercial pany in any case where its sales exceed or industrial building has been erected 300 lots or $500,000 in value. or where a sales contract obligates the seller to build one within two years; Developers must disclose in property reports past or pending 'disciplinary proceedings, - Real estate pursuant to a court order; bankruptcies or litigation' involving the - Real estate by government agencies; company or principal officers if these could affect buyers. These disclosures would have - Lots purchased wholesale by a person en- to include indictments of convictions re- gaged in the building business or buying lated to land sales. for resale to persons engaged in such business; There must be detailed reports on environ- mental factors. These include 'unusual' - Lots which exceed 10,000 square feet and noises, flooding conditions and odors from sell for less than $100, including clos- 'noxious smoke, chemical fumes, stagnant ing costs. ponds, slaughterhouse and sewage treatment Lease of: facilities.' - Lots for terms not exceeding five years, The developer must say whether or not he is providing the lessee is not required to legally and.financially obligated to make renew his lease. promised improvements, such as installation of clubhouses and swimming pools. He also Sale of: must disclose the availability of units and - Evidences of indebtedness secured by a sewage facilities.114 mortgage or deed of trust--for example, In addition, the new regulations contained the resale of a note generated by a land sale; guidelines governing land developer's advertising - Securities issued by a real estate invest- practices: ment trust; Ads now must advise buyers to obtain property - Cemetery lots.112 reports and must state whether pictured im- provements actually exist or are 'merely Exemptions which require HUD review and appro- promised.' Advertisers can't say a project val to qualify for eligibility include: is 'minutes away' from somewhere unless the mileage is also given. And the mileage must Tracts for which the HUD Secretary issues be measured via roads accessible by car. an exemption order waiving enforcement as, unnecessary for protection of purchasers. The ads also must @isclose whether pictured To qualify, the exemption request must scenes actually exist on the land being of- apply to a single transaction only, or fered or whether the pictures were taken else- involve a subdivision with fewer than where. And on the front page of the property 300 lots located, offered, and advertised reports to buyers must be overprinted in red within one State,and with no more than capital letters: 'purchasers should read this five per cent of the lots sold to nonresi- document before signing anything.'115 dents of that state in any given year; Under the provisions of the Interstate Land and Lots sold 'onsite, free and clear of Sales Full Disclosure Act, HUD is authorized to liens.' To qualify for this exemption, bring an action in any U.S. district court to en- the seller must file a claim with HUD join practices which violate the act, such as sale and prove that he sells only to purchas- ers who make onsite inspections and of unregistered land, improper disclosure in a prop- that all property restrictions are bene-, erty report, or deceptive sales practices. HUD is ficial and enforceable by lot owners. The seller must furnish buyers a HUD-ap- also authorized to transmit to the Attorney General proved statement setting forth reserva- evidence concerning illegal acts or practices, so tions, taxes, assessments and restric- tions on the lot, prior to signing the that he may initiate criminal proceedings. Willful sales contract. He must obtain a receipt violations of the act are punishable by a fine up for the statement from the buyer and file receipts with HUD once each year. The to $5,000 or imprisonment up to five years, or sales contract must require that the buyer both. By law, HUD can also institute formal admin- receive a deed within 120 days after sign- ing the contract.113 116 istrative proceedings which can lead to the suspen- 2. The offering of participation in a rental pool arrangement; and Sion of a developer's right to sell land covered 3. The offering of a rental or similar under the act.116 arrangement whereby the purchaser must Securities Act of 1933. Administered by the hold his unit available for rental for any part of the year, must use an ex- Securities and Exchange Commission (SEC), the Secu- clusive rental agent or is otherwise rities Act of 1933 was adopted by Congress to "pro- materially restricted in his occupancy vide full and fair disclosure of the character of or rental of his unit.120 securities sold in interstate and foreign commerce In addition, recreational land developments which and throughout the mails, and to prevent frauds in have been designated as securities offerings are sub- the sale thereof. ."117 The 1933 Securities ject to the fraud provisions of the 1933 Securities Act is the nation's model disclosure law, and re- Exchange Act, and their sales personnel can be re- quires extensive registration requirements and dis- quired to register and undergo examinations for closure of securities offered through the publica- licensing as brokers. tion and delivery of a detailed prospectus. Truth in Lending Act and the Federal Trade In 1946, the U.S. Supreme Court heard the Commission Act. Another government agency with case of SEC v. W.J. Howey Co., and held that "the some authority over consumer problems in land purchase of a subdivision of an orange grove coupled sales is the Federal Trade Commission (FTC). Un- with an offer of a service contract was found to der.the provisions of the 1969 Truth in Lending constitute an 'investment contract' within the de- Act (Regulation Z), the FTC is concerned with "un- finition of that term" in the 1933 Securities Act.118 fair" or "deceptive" sales practices used by any With this decision, the SEC expanded its authority commercial company, regardless of the products into various real estate offerings including author- involved. The FTC's main concern with the recre- ity over many recreational condominium and coopera- ational lot industry is deceptive advertising prac- tive arrangements common today. tices. A deceptive activity is defined as: The SEC has interpreted the Howey decision as . . . an affirmative misstatement of fact-- that is an express statement which is false applying to condominium sales which are coupled with as well as any reasonably implied state- rental or management agreements, and where the real ment. Such misrepresentations in the land @sales industry might include misdescriptions estate interest is offered together with a service of land location, exaggerations of the mar-- contract which includes rental services performed ket value, or the investment potential of a specific piece of land. by some management agent. Guidelines published by It might also be deceptive for a seller to SEC state that: withhold material information when he knows where this is the case any offering of any or should know that, if the buyer also had such securities must comply with the regis- the information, he probably,would not tration and prospectus delivery require- enter the sales agreement. Examples of ments of the Securities Act, unless an ex- this kind of deception include failure to emption therefrom is available, and must inform the purchaser of restrictive cove- comply with the anti-fraud provisions of nants, material easements, zoning ordi- the Securities Act and the Securities Ex- nances which would affect the use of the change Act and the regulations thereunder.119 land, or plans which public officials might have for the land in question. The guidelines summarize the types of proper- In significant part, the requirements of ties which the SEC laws apply to as follows: the Office of Interstate Land Sales Regis- In summary, the offering of condominium units tration and states seek to make certain that such disclosures are made. However, in conjunction with any one of the following will cause the, offering to be viewed as an to the extent that.promotional or advertis- offering of securities in the form of invest- ing materials used by the seller or the ment contracts: oral claims of the salesmen differ in any material respect from such disclosure state- 1. The condominiums, with any rental ar- ments, then their purpose is frustrated and rangements or other similar service, a deceptive practice may result which would. are offered and sold with emphasis on be challengeable by the Commission.121 the economic benefits to the purchaser to be derived from the managerial ef- The FTC also has the authority to issue cease forts of the promoter, or a third party and desist orders against firms guilty of deceptive designated or arranged for by the pro- moter, from rental of the units. or unfair trade practices in commerce under Sec- tion 5 of the Federal Trade Commission Act.122 117 222-878 0 - 77 - They also have widespread authority to regulate de- to protect consumers have had a relatively mild ceptive or misleading advertising. They may take effect on industry practices as a whole, with the several actions against guilty business including exception of OILSR. SEC regulations have been es- requiring full disclosure statements in a manner sentially limited to condominiums, a small segment comparable to the SEC, requiring a company to make of the recreational land development market. While restitution to consumers where money was secured in the FTC has wide ranging authority to regulate an unlawful manner or when the product is determined developers' advertising and marketing practices, to be worthless, and forcing the guilty party to do they have not exercised this authority very much corrective advertising. Failure to comply with an until recently. The bulk of the consumer protec- FTC order can bring a civil penalty of up to $5,000 tion job at the federal level has been left to per day for each violation. OILSR. Until recently, the FTC had taken relatively In 1972, OILSR was elevated in HUD's organiza- few actions against land sales firms; reports had tional structure to a position reporting directly been issued against four companies, each of which to the Secretary. The agency became more active complied with the FTC orders immediately.123 Then in consumer education. Enforcement activities in March, 1974, the FTC announced that it had tenta- were stepped up. The 17-city public hearings tour tively adopted a consent order from the GAC Corpora- which started two months after the agency's re- tion of Miami. in making amends for alleged fraudu- organization, was well received, and eventually lent market practices, GAC agreed to: W make cash culminated in the adoption of tougher revised regu- or land swap settlements totalling an estimated $17 lations. million for up to 50,000 consumers; (2) establish OILSR has essentially three actions it may binding dates in sales contracts for the completion take against a developer: (1) it can suspend sales, of promised improvements; (3) provide a mandatory usually for some factual or procedural error in 10-day cooling off period in which buyers can cancel the material filed by the developer; (2) it can contracts; (4) state clearly in the sales contracts issue notices of proceedings against developers, uncertainties of the future value of land being sold, requiring a hearing based on some suspicion of potential difficulties in reselling it, and warn buy- wrongdoing; and (3) it will follow up on complaint letters received from consumers. Also, OILSR of- ers that they should consult an attorney or a quali- fied real estate advisor before signing a sales con- ten reaches administrative agreements with devel- tract; and (5) a requirement that company sales per- opets, resulting in developers sending letters of sonnel abide by the conditions of the consent agree- recision to consumers who have purchased lots, giv- ment or be fired.124 The action against GAC estab- ing buyers the opportunity to void their sales con- lishes a new precedent for more aggressive exercise tracts and have their down payments, installments, of FTC authority over industry sales practices. 125 taxes, and assessments refunded. Mail Fraud Laws. The U.S. Postal Service also Sales have been suspended in over 250 devel- has some consumer protection authority through its opments since March, 1972. OILSR suspended sales Mail Fraud laws, which prohibit misrepresentative only 12 times in its previous three years of opera- or fraudulent advertising through U.S. mails.126 tion. By following up on complaint letters from Penalties up to $1,000 or five years in prison consumers, OILSR estimates that as of July, 1973 may be levied for each violation (each individual it had accounted for approximately $750,000 in piece of mail is considered a separate violation). refunds to dissatisfied customers. Unregistered Cases against land sales companies have gone up developers sought out by OILSR had been required slightly in recent years, but not significantly to send out 7,800 recision letters to their cus- more than for other types of businesses. Since tomers, which resulted in over $1.2 million in 1968, there have been 41 convictions against land refunds to dissatisfied purchasers of unregistered sales firms for violating mail fraud laws, and in land. OILSR had instituted seven criminal actions 1973, 63 cases were under investigation.127 resulting in three convictions, and four still Effectiveness of Federal Consumer Protection awaiting trial.128 Since 1973., substantial addi- Measures. Most federal agencies with some authority tional progress has been made. 118 In spite of some important victories on behalf as well as some debate over how "full" disclosure of recreational land buyers, however, consumer vic- should actually be. The property report is sup- timization continues. OILSR still receives complaint posed to be a warninq--the cover reads "PURCHASER letters at high rates. A 1973 report issued by the SHOULD READ THIS DOCUMENT BEFORE SIGNING ANYTHING" General Accounting Office concluded that bILSR was --but it has sometimes had just the opposite effect. not capable of adequately controlling the recre- one of the reasons for this warning, overprinted on ational land industry, primarily due to the small the cover in capital red letters was that: size of its staff.129 The GAC report found that . . . too many people were under the im- evident violations of the law exist and numerous pression that the existence of a property report meant that HUD had approved not complaints have gone unanswered. OILSR has only just the paper work but the development been in operation five years, and did not begin to itself.132 actively enforce the law until 1972. Charged with One industry critic said that the property report policing the entire recreational land development "affects the dignity of an official document, re- industry, OILSR has a full time staff of 74 (present- sponding to official questions under the penalty of ly authorized to increase to 80).130 Agency offi- the law," while the information it contains is sup- cials still estimate that less than half of the de- plied.by the regulatee, and much of it is based on velopers subject to the law have complied by regis- intentions rather than actual fact.133 A few developers have taken advantage of the tering their projects with HUD. In an effort to re- consumer's ignorance, announcing registration of solve some of these problems, OILSR placed an addi- tional 30 staff members in regional field offices their projects with HUD in their advertising, there- during the summer of 1974. by creating a false air of federal certification. Part of the reason for continued consumer .vic- Other cases exist in which salesmen have actually timization is the heavy reliance on the full disclo- told prospective customers that the "registration sure technique. Full disclosure has long been used constituted a government endorsement of the offer- in securities markets, providing investors with de- ing-,,134 Even HUD has on occasion encouraged con- tailed information to help them evaluate the invest- sumer confidence. ment potential of stocks and other securities. But - At times, the federal government's land- sales regulators themselves have been some problems occur when it is applied to consumer more than willing to boast of their pro- motional effect on the business they products such as recreat.ional lots. The full disclo- were commissioned to regulate in the sure technique permits the sale of a worthless pro- public interest. HUD's Office of Inter- duct as long as the buyer is told it's worthless. state Land Sales Registration (OILSR) had barely been in operation for 10 months in The seller is in complete compliance with the law so February, 1970 when it expressed its sat- long as he.provides the buyer with the product in- isfaction today with greater confidence under a consumer protection law. . . . 135 formation required'by the law. Full disclosure laws HUD officials admit that the mere existence of na- do not pass any judgment on the value or fitness of tional consumer protection legislation (especially the product itself, and in no way regulate the sub- when it receives a lot of Publicity) tends to lull stantive quality of the product. The cover page of consumers into a state of artificial security. the property report which OILSR requires developers Even when all goes-well with the delivery of to give to prospective buyers states: an accurate property report, the success of the law The Interstate Land Sales Full Disclosure must still rely on the consumer to read the report. Act specifically prohibits any representa- tion to the effect that the Federal Govern- All full disclosure legislation can do is provide ment has in any way passed upon the merits the buyer with information--there is no way of of, or given approval to this subdivision, or passed upon the value, if any, of the guaranteeing he will read it, much less ponder it property.131 (which he should, since the amount of technical in- The major problem with the full disclosure formation contained in a property report is far too technique is that this message does not always get detailed to digest on the spot). If the consumer through to the lot buyer. For a variety of reasons does not take the trouble to inform himself with there is often a breakdown in this communication process of disclosing important product information, 119 the data provided, there is little the Interstate ments to the Clean Air Act of 1973 (77 Stat. 392) Land Sales Full Disclosure Act can do. give authority for the protection and control of . . . where an individual gets absolutely the nation's air quality to the Environmental Pro- full and complete disclosure about perti- nent aspects of the land, and the sales- tection Agency (EPA). Regulations which were form- man tells him something else orally and erly the responsibility of state and local author- the individual fails to read the property report and buys on the salesman's oral ities are now in the hands of the EPA.140 The misrepresentation, there's practically goals of the 1970 legislation are to protect the nothing we can do to help the individual.136 public health through the enforcement of primary In addition, disclosure laws are at a serious air quality standards, and also to protect against disadvantage when forced to compete with a sales damage to the natural environment, property, eco- pitch for the consumer's attention. The property nomic values, and personal well-being, through en- report is often presented to the buyer in the mid- forcement of secondary air quality standards.141 dle of a high-pressured sales pitch often accom- States must prepare implementation plans for meet- panied by an artificial climate of urgency. Many ing national air quality standards, which must be consumers buy on the spot, giving their purchase approved by the EPA. The act as amended has had little, if any, thought. Policing the verbal claims effects on automobile design, transportation plan- made by land salesmen is virtually impossible, and ning, energy production, and land use. Its effects leaves the consumer alone to fend for himself. on recreational land development, however, have National Environmental Policy Act. The Nation- been minimal to date. It is possible that, at some al Environmental Policy Act (NEPA) requires federal agencies to consider the environmental consequences future date, the Clean Air Act could influence the of their actions, and prepare and circulate environ- design or location of large-scale developments. Water Pollution control Act Amendments of mental impact statements as specified in section 1972. The Federal Water Pollution Control Act, 102(2)(C) of the act. The large majority of impact statements filed have pertained to roads, watershed passed in 1956, established a program of water protection, and flood control projects by the De- quality standards and federal aid to local author- partment of Transportation and the Corps of Engi- ities for pollution control. By 1970, it was clear neers.137 that the program had not stopped deterioration of It has been argued that recreational land sales the nation's rivers, lakes and streams, and several branches of the federal government began to take should be subject to the requirements of NEPA. IIn action to solve the problem.142 In December of 1974, a suit was filed in federal court by two Okla- 1970, EPA and the Army Corps of Engineers began a homa environmental groups "to force the preparation permit and fine system for pollution discharges of environmental impact statements on interstate under the authority of the Refuse Act of 1899. Ob- land sales registrations filed with OILSR."138 OILSR, which once considered filing one EIS for its viously a stop-gap measure, the system "broke down and collapsed of its own weight."143 After exten- entire registration procedure, held the position sive hearings and debate, and a presidential veto, that registration only involves the collection of Congress enacted the Water Pollution Control Act Project information, and does not constitute a ma- jor action sIince OILSR has no authority to approve Amendments of 1972. or disapprove any actual plans for a project. The This legislation aims to eliminate all pollut- lower court ruled in favor of the environmental- ing discharges into navigable waters in the U.S. by 1985, and in the interim, to achieve a level of ists, and the case was appealed to the U.S. Supreme water quality which protects aquatic life and pre- Court.139 On June 24, 1976, the court held that serves waters for recreational use by 1983. EPA, while NEPA does apply to the Interstate Land Sales which administers the act, is responsible for water Full Disclosure Act, the impact statement require- quality standards and a permit system to be .run in ments cannot be reasonably applied to the 30-day cooperation with the states. Federal aid is avail- registration review process. able for areawide water quality planning and con- Clean Air Act Amendments of 1970. The amend- struction of municipal waste watertreatment works. 120 Like air pollution, water pollution is caused torical, esthetic, ecologicalr or cultural value.147 by both point and nonpoint sources. Inadequate Also, the act authorizes funds through 1980 for sewage disposal systems can pollute both surface and states to use in acquiring access ways to public ground water. Erosion and runoff from construction beaches. sites can cause siltation of streams and lakes, dam- It is too early to tell what specific effects aging aquatic life and water quality. this legislation will have on recreational land de- To date, EPA's enforcement activities have been velopment, but since development pressures are high focused on point sources--primarily industrial dis- in coastal areas, state management and regulatory charges and municipal sewage treatment plants. In programs stimulated by federal dollars may help to some areas where municipal treatment works are in- reduce some of the conflicts between land develop- adequate, EPA may refuse to permit new hook-ups un- ment and coastal environments which have occurred til the facility meets EPA standards. in the past. Section 208 of the act describes the content of Flood Disaster Protection Act. Flood-related the areawide waste treatment management plans, call- losses in the U.S. are estimated at $1 billion an- ing for the evaluation and control Of nonpoint nually, and they are increasing each year as more sources of pollution and specifically mentioning development occurs in flood plains.148 Administered construction-related pollution. Land use controls by HUD and the Federal Insurance Administration, the are a suggested means of controlling nonpoint Flood Disaster Protection Act of 1973 increases the sources, but details are left up to regional plan- amounts of insurance available and requires flood- ning agencies.144 These water quality plans, with plain management in communities which are receiving their resulting land use controls, are the one part federal financial assistance under a number of dif- of the Water Pollution Control Act most likely to ferent programs. To be eligible for insurance on have an impact on recreational land development. public and private property, a county or municipal- Coastal Zone Management Act. Another Federal ity must have HUD-approved land use regulations law which could have important indirect effects on covering flood-prone areas. Such regulations are recreational land development is the Coastal Zone typical zoning ordinances and building codes. Flood- Management Act passed by Congress in 1972.1 45 The prone areas include the 100-year flood plain on in- purpose of the act is to protect coastal areas by land lakes, rivers and streams; ocean and Great encouraging state management programs for the wise Lakes shorelines which are subject to storm erosion; use of land and water resources. Administered by and areas prone to mudslides (mainly in Califor- the National Oceanic and Atmospheric Administration, nia).149 the act makes grant monies available to the 30 coast- Counties and municipalities which do not par- al states for up to two-thirds of the cost of de- ticipate in the Flood Insurance Program will not be veloping and administering state coastal zone pro- eligible for assistance under the FRA, Veterans Ad- grams. ministration, Small Business Administration, and State grants are supporting such activities as other federal agency programs. in addition, banks resource inventories, the preparation of environmen- and savings and loan institutions under federal tal impact guidelines, and the development of plans supervision will not make loans on uninsured and regulations for the use of coastal areas.146 personal property and real estate in flood-prone Rhode Island plans to use a portion of its funds to areas. 150 study the impacts of energy and recreational needs Federal Income Tax Laws. The federal govern- on its coastal zone. ment may also have an influence on the recreational One important provision of the 1976 amendments land development industry through its income tax to the Coastal'Zone Management Act requires that policies. Until recently, many second homeowners state management programs receiving funds under the enjoyed what amounted to a small "tax shelter" if act include a planning process for the protection they rented their second home out during a portion of and access to public beaches and other public of the year.151 The Internal Revenue Service (IRS) coastal areas of environmental, recreational, his- allowed second homeowners to charge their expenses, 121 including annual depreciation allowances, against a bona fide profit-making venture ratherthan pri- rental income, resulting in a net operating loss marily for his own use. With the closing of this which could be claimed as a tax deduction against tax loophole, second homes now receive the same ordinary income. tax advantages as primary homes. Whether or not In mid-1972, the IRS released new retroactive these new regulations have had any dampening effect tax regulations implementing portions of the Tax on second home construction is unknown, but histor- Reform Act of 1969. The new rules permit second ically most second homes have been held for the pri- homeowners to count expenses equal to but not ex- vate use of their owners.rather than being rented ceeding rental income received, and only if the out. Second homeowners can still deduct mortgage owner can show that the property was purchased as interest payments from their income tax. NOTES 1. Rutherford H. Platt, "Backwoods Urban Growth: 11. Grunwald Crawford and Associates, Comprehen The Recreation Land Development Boom," Proceed- sive Plan to 1990, 22. cit., p. 10, 13. ings of the Association of American Geographers, Vol. 5, 1973, p. 228. 12. National Association of Counties, From Amer-- ica's Counties Today: 1973, (Washington: 1973), 2. American Society of Planning Officials, "Survey p. 31. on Recreational Land Development,'! Unpublished survey on local land use and development regu- 13. Alan J. Hahn, "Planning in Rural Areas," lations affecting recreational land develop- Journal of the American Institute of Planners, ments, conducted for this study by the American Vol. 34, No. 1, (January, 1970), pp. 44-49. Society of Planning Officials, (Chicago: 1973). n.p. 14. American Society of Planning Officials, "Sur- vey on Recreational Land Development," op..cit. 3. William E. Shands, The Subdivision of Virginia's Mountains: The Environmental IM2act of Recre- 15. Correspondence with Arthur 0. Olson, Planning ational Subdivisions in the Massanutten Moun- Director, Okanogan County, Washington, August tain-Blue Ridge Area, Virginia: A Survey and 3, 1973. Report. (Washington: The Central Atlantic Environment Center, February, 1974). 16. Wilbert H. Ulman, Mountain Recreational Com- munities and Land Use: The Summit County Ex- 4. Interview with Lorin Morgan, Director, Des- perience. (Denver: Colorado Land Use Commis- chutes County Planning Department, Bend, Oregon, sion, December, 1973), p. 49. August, 1973. 17. Telephone Interview with Tom Shepstone, Direc- 5. Grunwald Crawford and Associates, Comprehensive tor of Planning, Wayne County Planning Com- Plan to 1990, Prepared for the Deschutes County mission, Homesdale, Pennsylvania, February 22, Planning Commission, Deschutes County, Oregon, 1974. January, 1970, p. 11. 18. "Subdivision Law Compromised for Recreational 6. Interview with Lorin Morgan, op. cit. Plots," The Bulletin, Bend, Oregon, Wednes- day, February 9, 1972, p. 6. 7. U.S. Advisory Commission on Intergovernmental 19. Rod Taylor, "Subdividing the Wilderness," Relations, Profile of County Government, (Wash- Prepared from the Sierra Club Bulletin, (San ington: Government Printing Office, January, Francisco: Sierra Club, January, 1971), n.p. 1972), p. 34. 8. National Commission on Urban Problems, Local 20. Allen D. Manvel, for the National Commission Land and Building Regulations, (Washington: on Urban Problems, Local Land and Building Government Printing Office, 1968), p. 24. Regulations: How Many Agencies; What Prac- tices; How Much Personnel7 Research Report No. 6, (Washington: Government Printing 9. "Survey of Recreational Land Developers and Office, 1968), p. iii. Their Projects," Unpublished survey conducted 21. Brian Rogal, Expenditures, Staff, and Salaries for this study by Richard L. Ragatz and the Urban Land Institute, (Washington: 1973), n.p. of Planning Agencies: 1973, Planning Advisory Service Report No. 88, (Chicago: American Society of Planning Officials, February, 1973), 10. Interview with George Robertson, Executive p. 28. Director, Pasco County Builders Association, 22. John P. Workman, Donald W. MacPherson, Darwin New Port Richey, Florida, August, 1973. B. Nielsen, and James J. Kennedy. A Tax- 122 payer's Problern--Pecreational subdivisions in 42. Ibid. Utah. (Logan, Utah: Utah State University Press, 1974), p. 9. 43. Deschutes County Zoning Ordinance, No. PL-5, December, 1971, p. 15. 23. Frank P. Gad, Public Health Law Manual; A Handbook on the Legal Aspects of Public Health 44. American Society of Planning Officials, "Sur- Administration and Enforcement, Prepared under vey on Recreational Land Development," op. cit. the joint sponsorship of the U.S. Public Health Service and the American Public Health Associ- 45. Interview with Lorin Morgan, op'. cit. ation, Inc., New York, 1970, p. 16. 46. Interview with Harlan A. Clinkenbeard, Assist- 24. Interview with Carl Hammonds, Regional Planner, ant Director, Southeastern Wisconsin Regional Lord Fairfax Planning District Commission, Planning Commission, Waukesha, Wisconsin, July Front Royal, Virginia, April 25, 1973. 23, 1973. 25. Rod Taylor, "Subdividing the Wilderness," 47. Interview with Colonel Richard N. Rollason, op. cit. Chairman, Warren County Planning Commission, Front Royal, Virginia, April 25, 1973. 26. Ib. id. 48. Robert 1. Gould, "Property-Owners Associations: 27. Interview with Warren Duncan, City Manager, Avoid Problems with Planning," American Land, Front Royal, Virginia, July, 1973. Vol. 2, No. 5, 1973, p. 22. 49. Telephone Interview with Robert 1. Could, Vice 28. American Society of Planning officials, "Sur- President, Community Management Corporation, vey on Recreational Land Development," op. cit. Reston, Virginia, April 10, 1973. 29. Ibid. 50. Lyle E. Harrell, "Tour of Subdivisions in Lassen and Madera Counties," Unpublished 30. County of San Diego, California, "Back-Country paper, Josephine County Planning Department, Subdivision," Policy Number 1-26, p. 1. Grants Pass, Oregon, 1971, p. 6. 31. American Society of Planning officials, "Sur- 51. Robert Gladstone, and Robert Witherspoon, vey on Recreational Land Development," op. cit. "Environmental Impact Statements: A Current 32. Michael H. Wilkins, "Recreation-Residential overview," Environmental Comment, No. 10, Subdivisions and Development Activities in (June, 1974), p. 5.. Deschutes County, Oregon," Unpublished masters 52. Telephone Interview with David Strong, Chief thesis, (Eugene, Oregon: Department of Urban Deputy Prosecuting Attorney, Island County, Planning, University of Oregon, December, 1971), Washington, July 30, 1974. p. 12R. 53. Telephone Interview with John Keegan, Assist- 33. William G. Connolly, "Suburbia Marches on the ant Prosecuting Attorney, King County, Wash- Poconoc," New York Times, September 23, 1973, ington, July 29, 1975; and, Telephone Inter- p. 46. view with Ken Boud, Chief Environmental Plan- ner, Santa Cruz County Planning Department, 34. John P. Workman, et. al., A Taxpayer's Problem Santa Cruz, California, July 26, 1974. --Recreational Subdivisions in Utah, op. cit., P.9. 54. Hammer, Siler, George Associates, "Cost-Bene- 35. The 1970 Revised Zoning Ordinance of Utah fit Analysis for Thunderbird Site," Unpublished County, Utah, July, 1973. study prepared for the Warren County Planning Commission, Warren County, Virginia, December, 36. Several of the local planning departments re- 1973. sponding to the ASPO survey commented that they treated second and first home development the 55. "Amendment to the Bayfield County Subdivision same because of the similarity of their im- Control Ordinance," Bayfield County, Wisconsin, pacts. August 31, 1972, p. 4. 37. American Society of Planning officials, "Sur- 56. American Society of Planning Officials, "Sur- vey on Recreational Land Development," op.cit. vey on Recreational Land Development," op. Cit- 38. Ibid. 57. Michael H. Wilkins, "Recreation-Residential Subdivisions and Development Activities in 39. The 1970 Revised Zoning Ordinance of Utah Deschutes County, Oregon," op. cit., p. 46. County, Utah, op. cit., pp. 5-14. 58. American Society of Planning Officials, "Sur- 40. Telephone interview with Harold M. Pavlos, vey on Recreational Land Development," op. cit. Planner, Utah County Planning Commission, Provo, Utah, March 5, 1974. 59. Ibid. 41. American Society of Planning officials, "Sur- 60. Ibid. vey on Recreational Land Development," op. cit. 123 61. Tom McCall, "Oregon: Come Visit but Don't 78. Land Use Planning Reports, Vol. 2, No. 5, Stay," State Government, Summer, 1973, pp- shington: Plus Publications, Inc., March 4, 167-168. 1974), p. 10. 62. Summary of State Land Use Controls: A Special 79. Richard G. Rubino, "An Evaluation: Florida's Report from Land Use'Planning Reports, (Wash- Land use Law," State Government, Summer, 1973, ington: Plus Publications, Inc., September, p. 174. 1971), p. 21. 80. Phyllis Meyers, Slow Start in Paradise, 63. U.S. Senate, Committee on Interior and Insular op. cit., p. 14. Affairs, National Land Use Policy Legislation- 93rd Congress: An Analysis of Legislative 81. Paul O'Mara, "The Coastline Becomes Protected," Proposals and State Laws, Prepared by the En- Planning, the ASPO Magazine, Vol. 39, No. 3, vironmental Policy Division-Congressional 1973, march-April, 1973, p. 27. Research Service, (Washington: April, 1973, p. 161. 82. Land Use Planning Reports, Vol. 2, No. 1, 64. American Society of Planning-Officials,,Zoning (Washington: Plus Publications, Inc., March Digest, Vol. 25, Issue 3, (Chicago: 1973), p. 12, 1973), p. 8. 78. 83. "U.S. Struggle to Meet Demand for More Public 65. Interview with Lorin Morgan, op. cit. Beaches," The Christian Science Monitor, July 8, 1972, p. 10. 66. International City Managers Association, "Tech- 64 Oregon Coastal Planning Group, Study Design. nical Currency in the Local Building Code," Prepared for the Oregon Coastal Conservation Urban Data Service Reports, Vol. 3, No. 4, and Development Commission, (San Francisco: April, 1971, p. 4. 1972), pp. 54-55. 67. Telephone Interview with H. Tejuja, Mechanical 85. Michael Freedr "Reaching the Sea Around Us: Engineer, office of Buildinq.Standards and Interests Clash over Coastline Access," Cali- Code Services, National Bureau of,Standards, fornia Journal, October, 1972, p. 301. Washington, D.C., May 9, 1974. 68- A Summary of State Land Use Controls: A spe@7 86. Philip Fradkin, "Sea Home Developments," En- vironmental Comment, No. 4, (Washington: cial Report from Land Use Planning Reports, Urban Land Institute, December, 1973), p. 6. op. cit., pp. 280, 28-29. 87. Fred Bosselman and David Callies, The Quiet 69. Fred Bosselman and David Callies, "Quiet Revo- Revolution in Land Use Controls. Prepared lution-Summary Report," contained in the Coun- for the Council on Environmental Quality, cil of State Governments,' The State's Role in (Washington: Government Printing Office, Land Resource Management, (Lexington, Kentucky: 1971), p. 240. January, 1972), p. 76. 88. Jon A. Kusler, Survey: Lake Protection and 70. A Summary of State Land Use Controls: A Spe- Rehabilitation Legislation in the United cial Report from Land Use Planning Reports, States. An Inland Lake Renewal and Shoreland op. cit., p. 25. Management Demonstration Project Report funded by the Upper Great Lakes Regional Commission, 71. Phyllis Myers, Slow Start in Paradise, (Wash- March, 1972, pp. 2-3. ington: The Conservation Foundation, February, 1974), pp. 14-15. 89. Steven M. Born, and Douglas A. Yanggen, Under- standing Lakes and Lake Problems. Prepared 72. Fred Bosselman and David Callies, "Quiet Revo- for the Upper Great Lakes Regional Commission, lution-Summary Report," op. cit., p. 79. (Madison, Wisconsin,@ 1972 ), pp. 34-35. 73. Richard F. Krochalis, "Statewide Land Use Plan- 90. R.W. Snyder, "An overview: Minnesota's Shore- ning," Urban Land,@September, 1972, p. 12. land Management Program," Minnesota Tourist 74. Travel Notes, Vol. 9, No. 1, University of James Nathan Miller, "Hawaii's Quiet Revolu- Minnesota, Cooperative Extension Service, tion Hits the Mainland," National Civic Review, February, 1971, p. 2. September, 1973, p. 419. 91. Northern Environmental Council, "Can We Pre- 75. Council on Environmental Quality, The Sixth vent Future Chaos from Recreational Land Annual Report, (Washington: U.S. Government Developments?," Policy Research Paper No. 12, Printing Office, December, 1975), p. 653. October, 1972. 7.6. Ibid., p. 652. 92. Fred Bosselman and David Callies, The Quiet Revolution in Land Use Controls, op. cit., 77. American Society of Planning Officials, "Sur- pp. 241-242. vey on Recreational Land Development," op. cit. 93. Ibid. p, 242. 124 94. Charles Irvin Zinser, "The Impact of Leisure 108. Interview with Robert G. McCunes, Vice Presi- Homes on the Economy of the Area within the dent for Government Relations_ American Land 'Blue Line' of the Adirondack Park," Unpub- Development Association, Washington, D.C., lished PhD dissertation, (Urbana-Champaign: January 24, 1974. University of Illinois, 1974). 95. Ibid., p. 69. 109. Housing and Urban Development Act of 1968 (Public Law 90-448, 82 Stat. 476, 590; 15 96. Adirondack Park Land Use and Development Plan U.S.C. 1791) Title XIV-Interstate Land Sales, and Recommendations for Implementation, (Ray Sec. 1402. (3). Brook, New York: Adirondack Park Agency, March 6, 1973). 110. Sample Statement of Record, Prepared by the Office of Interstate Land Sales Registration, 97. Interview with Richard F. Estes, Jr., Assist- U.S. Department of Housing and Urban Develop- ant Director, Adirondack Park Agency, July 2, ment, Washington, November, 1973. Obtainable 1974. from the Superintendent of Documents, U.S. Government Printing Office, Washington, D.C. 98. Subsequent information on state land sales 20402. regulations was obtained from the files of the U.S. Department of Housing and Urban 111. U.S. Department of Housing and Urban Depart- Development, Office of Interstate Land Sales ment, Buying Lots from Developers, U.S. Gov- Registration, January 24, 1974; and the Arneri- ernment Printing Office, Washington, 1973, can Land Development Association, Digest of p. 7. State Land Sales Regulations (Washington: American Land Development Association, 1973). 112. Ibid., p. 12. 99. T.E. Dickinson and W.E. Johnston, "An Evalua- 113. Ibid., p. 13. tion of Owner's Expectations of Building with- in Remote Rural Subdivisions: Impacts on the 1141. Tough New Rules Force Recreation-Land Sellers Rural Cormnunity," op. cit. to Reveal Finances Plus 'Unusual' Noises, Smells," The Wall Street Journal, Thursday, 100. Morton C. Paulson, The Great Land Hustle, January 24, 1974, p. 32. (Chicago: Henry Regnery Company, 1972), p. 169. 115. Ibid. 101. Ibid. 116. General Accounting office, Need for Improved Consumer Protection In Interstate Land Sales, 102. Anthony Wolff, Unreal Estate, (San Francisco: (Washington: Government Printing office, 1973), Sierra Club, 1973), p. 266-267. p. 5-9. 117. Securities Act of 1933 (As Amended to Octob4r 103. Morton C. Paulson, The Great Land Hus Itle, op. 22, 1965) (Public - No. 22 73D Congress], cit., P. 169. [H.R. 54801, United States Securities and Ex- 104. Ibid. change Commission. 118. American Land Development Association, Land 105. Statement of George K. Bernstein, Interstate Development Law Reporter, (Washington: Amer- Land Sales Administrator, Department of Hous- ican Land Development Association, 1973), ing and Urban Development, at the Convention p. III-LDLR-SEC-C-i. of the National Association of Real Estate License Law Officials, Las Vegas, Nevada, 119. "Guidelines as to the Applicability of the November 8, 1972, HUD News Release. Federal Securities Laws to Offers and Sales of Condominiums or Units in a Real Estate 106. Committee on Interior and Insular Affairs, Development," Securities and Exchange Commis- U.S. Senate, Land Use Policy and Planning sion, Washington, January 4, 1973, Securities Assistance Act Report, U.S. Senate, 93rd Con- Act of 1933, Release No. 5347, p. 1. gress' lst. Session, Report No. 93-197 (Wash- ington: Government Printing Office, June 7, 120. Ibid., p. 4. 1973), p. 39. 121. Richard C. Foster, "The Federal Trade Commis- 107. S.268, Sect. 202(d)(2). The Amendment, intro- sion and Consumer Protection in the Land Sales duced by Senator Gaylord Nelson of Wisconsin, Industry" (remarks made before the Third Annual would have suggested that state programs re- Industry-State-Pederal Siminar, Ft. Lauderdale, quire developers to submit,a schedule of plan- Florida, November 4, 1971), pp. 4-5. ned improvements and proof of financial capa- bility to complete the improvements. A "State- 122. American Land Development Association, Land ment of potential effects" was called for, Development Law Reporter, op. cit., p. II- which would take into account water and power LKLR-FTC-3. supply, waste disposal, potential flooding and soil stability problems, scenic resources, 123. These three reports are available from the public open space, and the fiscal impacts of Federal Trade Commission and are entitled: proposed developments. (1) "Final Consent Order: Great Western United Corporation," C-23-6; (2) "Complaint Against 125 Great Northern" 7123378; (3) "Final Opinion 138. American Society of Planning Officials, Land of Commission: Charnita, Ind.," 8829. Use Law and Zoning Digest, Vol. 26, No. 3, 124. Recreation.Land and Leisure Housing Report, 1974 ., pp. 2-3. Vol. 5, No. 5. (Los Altos, California: Hous- 139. Flint Ridge Development Co. v. Scenic Rivers ing Data Bureau, Inc., April 15, 1974), p. 1. Association of Oklahoma, F.2d (6th 125. "GAC Consent order Should Be Land Industry Cir. 1975), cert. granted, 44 U.S.L.W. 3344 Model, Says FTC's Foster," Housing Develop- (U.S. Dec, 9, 1975). ment Reporter, (Washington: The Bureau of 140. Fred Bosselman, Duane A. Feurer, and David L. National Affairs, Inc.). Callies, EPA Authority Affecting Land Use, a Report Prepared for the Office of Planning 126. A summary description of these laws is avail- and Evaluation, U.S. Environmental Protection Agency, (Chicago: Ross, Hardies, O'Keefe, able in: "Mail Fraud Laws Protecting: Con- Babcock & Parsons, March 12, 1974). sumers, Investors, Businessmen, Patients, Students" (Washington: Government Printing 141. Environmental Protection Agency, "Prevention Office, 1971). of Significant Air Quality Deterioration, Pro- proposed Rule-making," Federal Register, Vol. 127.- Interview with Anthony Miller, United States 38, No. 135, (Washington: Government Printing Postal Service, Washington, D.C., July 10, Office, July 16, 1974), p. 18987. 1973. 128. Testimony of George K. Bernstein, Interstate 142. "New Legislation for Water Quality," Resources, Land Sales Administrator, Department of Hous- No. 42, (Baltimore: Resources for the Future, ing and Urban Development, Before the Subcom- January, 1973), p. 2. mittee on Housing, Housing Committee on Bank- ing and Currency, May 8, 1973; and interview 143. Lester Edelman, "Congressional Intent of the with Alan Kappeler, OILSR, January 24, 1974. 1972 Federal Water Pollution Control Act," Journal of Water Pollution Control Federation, 129. U.S. Government Accounting Office, Need for Vol. 45, No. 1, (Washington- Water Pollution Improved Consumer Protection in Interstate Control Federation, January, 1973), p. 158. Land Sales, op. cit., p. 2. 144. Land Use Planning Reports, (Washington: Plus Interview with Allen Kappeler, OILSR, January lications, Inc., December 31, 1973), pp. 24, 1974. 6-8. 131. Sample Property Report, Prepared by the 145. Coastal Zone Management Act of 1972, P.L. Office of Interstate Land Sales Registration, 92-583. U.S. Department of Housing and Urban Devel- 146. Land and the Environment, Vol. 2, No. 6, opment, Washington, November, 1973. Obtain- able from the Superintendent of Documents, (Silver Spring, Maryland: Business Publica- tions, Inc., March 22, 1974), p. 45. U.S. Government Printing Office, Washington, D.C. 20402. 147. Coastal Zone Management Act Amendments of 132. George Bernstein, "OILSR Administrator 1976 (P.L. 94-370), Sections 305 and 315. Addresses Land Developers," American Land, 148. Nicholas Lally, "The National Flood Insurance Vol. 2, No. 9, December, 1973, p. 7. Program: A New Land-Use Tool," Environmental 133. Anthony Wolff, Unreal Estate, op. cit., Comment, No. 8, (Washington: Urban Land In- p. 260. situte, April, 1974), p. 13. 134. Morton C. Paulson, The Great Land Hustle, 149. Telephone Interview with William C. Fucik op. cit., p. 173. Director, Regional Flood Insurance Office, Department of Housing and Urban Development, 135. Anthony Wolff, Unreal Estate, op. cit., Chicago, Illinois, July 15, 1974. p. 258. 150. Southeastern Illinois Regional Planning and 136. George K. Bernstein, "OILSR Administrator Development Commission Newsletter, Vol. 5, Addresses Land Developers," cit., p. 7. No. 3, (Harrisburg: April, 1974). 151. "For 'Second Home' Owners: A Stiff New Tax Rule," U.S. News and World Report, Vol. 73, 137. Council on Environmental Quality, Environmen- No. 4, July 24, 1972, p. 63; and Telephone tal Quality: The Fourth Annual Report of the Interview with Taxpayer Service, Internal Council on Environmental Quality , (Washington: -Revenue Servicer Chicago, Illinois, July 30, Government Printing Office, September, 1973), 1974. pp. 242-245. 126 SELECTED BIBLIOGRAPHY This bibliography has been organized into six sub- tion; (5) Regulation; and (6) General/miscellaneous. ject categories to help the reader find material on Entries which address more than one of these sub- specific aspects of recreational land development: jects are listed either in the category with which (1) Market/Inventory Studies; (2) Environmental Im- they deal primarily or in the category entitled pacts; (3) Economic Impacts; (4) Consumer Protec- General/Miscellaneous. MARKET/INVENTORY STUDIES nomics Division, Economic Research Service, U.S. Department of Agriculture, August 1964. Agency of Environmental Conservation, State of Ver- mont. Vermont Vacation Home Inventory, 1973. "The Land Rush for Country,Homes." Business Week Montpelier: June 1974. (January 15, 1972), pp. 76, 78. American Land Development Association. "American "Leisure Boom: Biggest Ever and Still Growing," Land Second Home Report, 1973." American Land U.S. News & World Report (April 17, 1972), pp. 2: 7 (July 1973), pp. 16-7. 42-45. The Land Industry Survey, 1973. Washing- "The New American Land Rush." Time (February 28, ton, D.C.: 1973. 1972), pp. 72-73. -. The Land Industry Survey, 1974. Washing- "Now- A Rush to Buy Land." U.S. News & World Re- ton, D.C.: 1974. port (March 9, 1970), p. 54. Arizona office of Economic Planning and Develop- Ragatz, Richard L, Vacation Homes- An Analysis of ment. Arizona's Remote Subdivisionst An In- the Market for Seasonal Recreational Housing. ventory. Phoenix, Ariz.: January 1975. Ithaca, New York: Department of Housing and Urban Design, Cornell University, 1969. "Away From It All: The Second-Home Boom." News- week (August 5, 1968), pp. 58-60. Associates, Inc. Recreational Properties: An Analysis of the Markets for Privately Owned Bevins, Malcolm. Seasonal Home Ownership in Ver- Recreational Lots and Leisure Homes. Prepared mont. Burlington: University of Vermont, De- for the President's Council on Environmental partment of Agricultural Economics, 1972. Quality, U.S. Department of Housing and Urban Development, and Appalachian Regional Commis- Carruth, Eleanor. "The Corporate Move to Leisure sion. Eugene, Ore.: May 1974. Towns." Fortune (April 1971), p. 74. Recreational Properties in Appalachia: An Donovan, George. Vermont Vacation Home Survey. Analysis of the Markets for Privately Owned Montpelier: Vermont Development Department Recreational Lots and Leisure Homes. Prepared and'the Interagency Committee on Natural Re- for the Appalachian Regional Commission. Eu- sources, 1969. gene, Ore.: September 1974. Economic Research Associates. Evaluation of Deter- Reardon, Tim. "The Expanding Market for Recrea- minants of Successful Developments in Califor- tion condominiums." Real Estate Report (Fall, nia's Recreational Land Market. Los Angeles: 1973). Chicago., Real Estate Research Corpor- 1970. ation. "83 Billion Dollars for Leisure: Now the Fastest- Schumacher, William E. 1970 Non-Resident Landowner Growing Business in America." U.S. News and Study: Green County, New York. Cairo, N.Y.: World Report (September 15, 1969), pp. 58-61. D.M. Extension Center, 1971. Fine, I.V., and Tuttle, Roy E. Private Seasonal Sinclair, Robert 0., and Meyer, Stephen B. Non- Housing in Wisconsin. Wisconsin Development resident Ownership of Property in Vermont. Series. Madison: Department of Resource De- Bulletin 670. Burlington. Agricultural Ex- velopment, State of Wisconsin, 1966. periment Station, University of Vermont, May 1972. Fine, I.V., and Werner, E.E. Private Cottages in Wisconsin. Wisconsin Recreation Papers, vol. Snyder, Robert S., and Adams, Duane. Seasonal 1, no. 4. Madison: Bureau of Business Re- Recreation Properties in Minnesota. Minne- search'and Service, School of Commerce, Uni- sota Farm Business Notes No. 495. St. Paul: versity of Wisconsin, April 1960. Agricultural Extension Service, Institute of Agriculture, University of Minnesota, May Johnson, Hugh A. Rural Residential Recreation Sub- 1967. divisions Serving the Washington, D.C., Area, 1963. Agricultural Economic Report no. 59. Thorsen, Brian J.; Cooper, Rollin B.; Staniforth, Washington, D.C.- Resource Development Eco- Sydney D.; and Christiansen, Rudolph A. Wis- 127 consin Second Home Ownership: Wisconsin Resi- mental IM2act Analysis: Philosophy and Meth- dents. Madison: Recreation Resources Center oas. SEA Grant Publication WIS-SG-72-111. and Department of Agricultural Economics, Uni- @iadison: SEA Grant Program, University of versity of Wisconsin, 1973. Wisconsin, 1972. U.S. Department of Commerce, Bureau of the Census, Geology and Geomorpholo2y of the Lake Tahoe Region. and U.S. Department of Agriculture, Forest A guide for planning prepared for Tahoe Re- Service. Second Homes in the United States. gional Planning Agency and U.S. Forest Service. H-121, no. 16, Washington, D.C.: June 1969. South Lake Tahoe, Calif.: September 1971. U.S. Department of Interior, Bureau of Outdoor Rec- Georgia Mountains Planning and Development Commis- reation. Northern New England Vacation Home sion, Survey and Analysis of the Environ- Study, 1966. Washington, D.C.: 1967. mental Impact of Leisure-Oriented Residential iTevelopments. Sponsored by the Department of Wright, Gordon. ,Selling Condominiums Two at a Community Development and prepared in coopera- Time: One Near Chicago, Other in Florida." tion with the U.S. Department of Housing and House and Home (October 1972), p. 36. urban Development. Gainesville, Ga.: January 1974. ENVIRONMENTAL IMPACTS Glaize, Katie. "Developers Strike Gold in Homes Away from Home," Environmental Action 4: 13 Bevins, Malcolm J. Attitudes on Environmental Qual- (November 11, 1972), pp. 11-13. ity in Six Vermont Lakeshore Communities. Northeastern Regional Research Publication Bul- Jezeski, James, J., et al. Impact of Large Recyea- letin 671. Burlington: Agricultural Experi- tional Developments Upon Semi-Primitive Envi- ment Station, University of Vermont, 1972. ronments. Bozeman: Center for Interdisci- plinary Studies, Montana State University, "Big Sky: Paradox in Paradise." Colorado Magazine, June 1973. (September-October 1973), pp. 19-23, 68-71. Kusler, Jon A. Artificial Lake and Land Subdivi7 Bird, Helen Privett. "Environmental and Economic sions. An Inland Lake Renewal and Shoreland Impact of Rapid Growth on a Rural Area: Palm Management Demonstration Project funded by the Coast." Environmental Affairs 2: 1 (Spring Upper Great Lakes Regional Planning Commission. 1972), pp. 154-171. Madison: University of Wisconsin and Wisconsin State Department of Natural Resources, March Browning, Peter. "Mickey Mouse in the Mountains: 1972. The Folks Who Brought You Disneyland Yearn to Turn California's Mineral King Valley into a Carrying Capacity Controls for Recreation Mammoth Ski Resort." Harper's Magazine (March Water Uses. An Inland Lake Renewal and Shore- 1972), pp. 65-71. land Management Demonstration Project Report funded by the Upper Great Lake Regional Plan- Burby, Raymond J., III; Donnelly, Thomas G.; and ning Commission, Madison: 1972. Weiss, Shirley F. Lake Norman Development Im- pact Study. Prepared for the Central Carolina Leopold, Luna B.; Clarke, Frank E.; Hanshaw, Bruce Council of Governments and the Lake Norman Ma7 B.; and Balsley, James R. A Procedure for rine Commission. Chapel Hill: Center for Ur- Evaluating Environmental Impact. Circular ban and Regional Studies,.University of North 645, Washington: U.S. Geological Survey, De- Carolina, June 1972. partment of the Interior, 1971. California Department of Conservation, Division of Limnology and Water ouality of the Lake Tahoe Re- Soil Conservation. Environmental Impact of gion. A guide for planning prepared for Ta- Urbanization on the Foothill and Mountainous hoe Regional Planning Agency and U.S. Forest Lands of California. Sacramento., November Service. South Lake Tahoe, Calif.: July 1971. 1971. Minnesota Department of Natural Resources, Division Campbell, Charles E. "Some Environmental Effects of of Waters, Soils, and Minerals. Shoreland Man Rural Subdividing in an Arid Area: A Case agement: Elements and Explanation of the Study in Arizona." Journal of Geography 71: 3 Shoreland Rules and Regulations. Supplementa- (March 1972.), 147-15-z. ry Report no. 2. St. Paul: August 1971. Daiber, Franklin C., et al. Environmental Impact of Nieswand, George H.; Stillman, Calvin W.; and Ess- Dredge and Fill (TPE;rations in Tidal Wetlands er, Anthony J. Survey of Estuarine Site De- Upon Fisheries Biology in Delaware. Newark, velopment Lagoon Homeowners, Ocean County, New Delaware: College of Marine Studies and De- Jersey. New Brunswick, N.J.: New Jersey Water partment of Biological Sciences, University of Resources Research Institute, Rutgers Univer- Delaware, December 1972. sity, July 1973. Dickert, Thomas G., and Domeny, Katherine R., eds. Rickert, David A., and Spieker, Andrew M. Real Es- Environmental Impact Assessment: Guidelines tate Lakes. Circular 601-G, Washington, D.C.: and Commentary. Berkeley: University Exten- U.S. Geological survey, Department of the In- sion, University of California, 1974. terior, 1971. Ditton, Robert B., and Goodale, Thomas 1. Environ- "Seasonal Variations in Visitors Present Biggest 128 Disposal Difficulty." Solid Wastes Manage- N. Y. : 1966. ment/Liquid Wastes Management and Refuse Re- moval Journal 15: 10 (October 1972), pp. 28, David, Elizabeth L. "The Exploding Demand for Rec- 30, and 60. reation Property." Land Economics 45: 2 (May 1969), pp. 206-217, Shands, William E. The Subdivision of Virginia's Mountains: The Environmental Impact of Rec- "The Dollars and Cents of Recreation," House and reational Subdivisions in the Massanutten Home (February 1973), pp. 75-108. Mountain-Blue Ridge Area, Virginia: A Survey and Report. Washington, D.C.: Central Atlan- "For 'Second Home' owners: A Stiff New Tax Rule." tic Environment Center, February 1974. U.S. News & World Report (July 24, 1972), pp. 63-64. Sharkway, M. Atef, and Greaskamp, James A. Inland Lake Renewal and Management Demonstration: Hedger, Stephen. Downhill in Warren: The Effects Lily Lake Forest Recreational Environment. of the Ski Industry and Land Development in Madison: Environmental Awareneness Center, Warren, Vermont. Montpelier; Vermont Public School of Natural Resources, University of Interest Research Group, Inc., October 1972. Wisconsin, 1971. Paul Henrick and Associates. The Impact of Recrea- Stuart, David G. Impacts of Large Recreational De- tion Vacation and Travel on New Hampshire-- velopments Upon Semi-Primitive Environments: 1954, 1958, 1963, 1967, 1970. Concord: Office The Gallatin Canyon Case Study. Bozeman: of City Planning, State of New Hampshire, May Montana State University, June 1974. 1971. Tahoe Regional Planning Agency. Guideline for Pre- Isard, Walter, and Coughlin, Robert. Municipal paring an Environmental Information Report as Costs a@d Revenues Resulting from Community Required for Submittal of Applications to the Growth. Federal Reserve Bank of Boston and Tahoe Regional Planning Agency. South Lake American Institute of Planners. Boston: Tahoe, Calif.: January 1973. Chandler-Davis Publishing Company, 1967. Trzyna, Thaddeus C. Environmental Impact Require- Johnson, Edwin L. Effect of Second Home Development ments in the States. Claremont, Calif.: on Ludlow, Vermont, 1973. Southern Windsor Center for California Public Affairs, The County Regional Planning Commission by ENVICO. Claremont Colleges, 1974. Springfield, Vt.: 1973. Turrentine, Julie Paltenghe. "Endangered Island; Knetch, Jack L., and Parrott, C. Jennings. "Esti- Nantucket's Fate May Portend the Future of the mating the Influence of Large Reservoirs on Other Rare Natural Areas Throughout the Coun- Land Values." Appraisal Journal 32: 4 (Octo- try." Catalyst 3: 2 (Spring 1969), pp. 10-14. ber 1964), pp. 537-546. University of California, Los Angeles, School of "Land-Sales Companies Refigure Their Books." Busi- Architecture and Urban Planning, and the Envi- ness Week (May 12, 1973), pp. 78, 80. ronmental Science and Engineering Program. Facing the Future: Five Alternatives for Mam- LeJeune, Harold. Economic Impacts of Artificial mouth Lakes. Summary report of the Mammouth Lake Development: Lakes Sherwood and eamelot, Lakes/UCLA Project. Los Angeles: Friends of A Case History. An Inland Lake Renewal and Mammoth, 1972. Shoreland Management Demonstration Project Re- port funded by the Upper Great Lakes Regional Vrchota, Janet. "Amelia Island: Ecologically Sen- Commission. Madison: April 1972. sitive Resort." Design and Environment 4: 1 (spring 1973), pp. 44-47. - . Net Tax Effect of Lake Sherwood and Lake Camelot. A seminar report submitted in par- Wallace, James R. The Effects of Land-Use Change tial fulfillment of the requirements for the on the Hydrology of an Urban Watershed. At- degree of Master of Science. Madison: Coop- lanta: Georgia Institute of Technology, Sep- erative Extension Education, University of tember 1971. Wisconsin, 1971. Wildlife of the Lake Tahoe Region. A guide for Mace, Ruth L. Municipal Cost-Revenue Research in planning prepared for Tahoe Regional Planning the U.S.--A Critical Survey of Research to Agency, South Lake Tahoe, Calif.: May 1971. measure Municipal Costs and Revenues in Rela- tion to Land Uses and Areas: 1933-1960. Cha- pel Hill: Institute of Government, University ECONOMIC IMPACTS of North Carolina, 1961. Brown, Richard N.*, Jr. Economic Impact of Second- Muller, Thomas, and Dawson, Grace. The Fiscal Im- Home Communities: A Case Study of Lake Laton- pact of Residential and Commercial Development: ka, Pa. Washington, D.C.: Economic Research A Case Study. Washington, D.C.t Urban Land Service, U.S. Department of Agriculture, No- Institute, December.1972. vember 1970. Robert R. Nathan Associates, Inc, Impact of Devel- Chautauqua County Planning Board and Department of opment of Assateague Island: @n Analysis of Planning. Second Homes and Their Impact on Alternative Modes of Development and Their Ef- the Economy of Chautauqua County. Mayville, fects on Worcester County and its Finances. 129 Washington, D.C,: April 12, 1963, U.S. Department of Interior, Bureau of Outdoor Rec- reation. Recreation Land Price Escalation. Recreation as an Industry, Prepared for Washington, D.C.: 1967. the Appalachian Regional Commission, Washing- ton, D.C.: December 1966. Workman, John P.; MacPherson, Donald W.; Nielsen, Darwin B.; and Kennedy, James J. A Taxpayer's Pendl, Charles R. "The Appraisal of Recreational Problem--Recreational Subdivisions in Utah. Land on Inland Lakes and Streams." Appraisal Loan, Utah: Utah State University Press, 1974. Journal 39: 4 (October 1971), pp. 583-591. Zinser, Charles I. "The Impact of Leisure Homes on Pennington, Allen L. The Economic Impact of the the Economy of the Area Within the 'Blue Line' Proposed Fairfield Bay, Inc., Retirement--Rec- of the Adirondack Park." Unpublished Ph.D. reation Complex in Cumberla I County, Tennes- dissertation, University of Illinois, 1974. see. Prepared for Fairfield Bay, Inc. Little Rock, Ark. .CONSUMER PROTECTION Richey, Clyde W. "Value and Property Taxes of a Second Home Subdivisioni Case Study." Land Bernstein, George K. "The State's Role Is Paramount Economics 48: 4 (November 1972), pp. 387-392. in Interstate Land Sales." HUD Challenge (June 1973), pp. 2-6. Rosner, Monroe. Fiscal Impact Model: A Simulation Approach to Analyzing the Local Fiscal Impact Bleck, Erick K. "Merchandising Remote Subdivision of Second-Home Development." Paper presented Lots in Southern Arizona." Arizona Research at the 40th Annual National Planning Confer- (August-September 1972), p. 74.. ence, American Society of Planning Officials, Chicago, May 15, 1974. Boschken, Herman L. Corporate Power and the Mis- I marketing of Urban Development: Boise cascade Schaenman, Philip S. and Muller, Thomas. Measuring Recreation Communities. New York: Praeger Impacts of Land Development. Washington, D.C.t. Publishers, 1974. The Urban Institute, 1974. A Checklist for Buying Property in Small Lake De- Smith, William C. "A Lender Looks at Second-Home velopments. Columbia, Mo.! Extension Divi- Financing." Real Estate Review 3: 2 (Summer, sion, University of Missouri, 1973. 1973), pp. 27-30. Conboy, Vince. Expose: Florida's Billion Dollar Snyder, Robert. "Seasonal Homes Benefit Rural Min- Land Fraud. Naples, Fla.: 1972. nesota." Minnesota Science 24: 2 (Winter, 1966), pp. 16-21. Eberl, George and Loomis, Ken. "Buying U.S. Land Overseas." The Staro and Stripes (December 14, "Vacation Homes, Economic Development, and 1972). entire issue. Local Government Policy in Rural Minnesota." Minnesota Agricultural Economist, no. 519. St. Gardner, Judy. "Land-Sales Industry Braces for Paul: Agricultural Extension Service, Insti- Tighter Federal, State Regulation." National tute of Agriculture, University of Minnesota, Journal 5: 3 (January 20, 1973), pp. 90-98. June 1969. U.S. Government Accounting Office, Comptroller Gen- Strang, William A. Recreation and the Local Econ- eral of the United States. Need for Improved omy: An Input-Output Model of a Recreational- Consumer Protection in Interstate Land Sales. Oriented Economy. Technical Bulletin no. 4. Report to the Congress. Washington, D.C.: Madison: SEA Grant Program, University of Wis- U.S. Government Printing Office, 1973. consin, October 1970. A Guide to Wise Land Buying: Facts You Should Know Systems Analysis and Research Corporation. Economic About the Land of Enchantment. Santa Fe, N.M.: Impact of Recreation, Vacation, and Travel on Central Clearing House, 1973. New Hampshire. Concord, N.H.: July 1965. Hanmaker, John. "An Investigation of the Organized Systems Management Association. The Tejon Ranch Second Home Community Market in Georgia to De- Lake Project: An Evaluation of its Impact on termine if Property owners Receive or Will Re- Kern County Ta?:2ayers. Prepared forthe Pro- ceive the Facilities for Which They Pay." Un- ject Land-Use Task Force. Bakersfield, Calif.: published Ph.D. dissertation. Georgia State December 30, 1972. University, 1971. Tillson, Gregory D.; Youmans, Russell C.; and Thom- Jones, Robert. "Selling the Miraqez A Nice Piece as, Marion D. Local Tax Impact of Recreation- of Desert." Nation (December 13, 1971), pp. al Subdivisions: A Case Study. Special Report 616-626. 365. Corvallis: Oregon State University Ex- tension Service, July 1972. Lake Development Property: A Consumer's Buyin Guide. Columbia, Mo.: Extension Division, Udell, Jon G. Expenditures and Perceptions of Pr22- University of Missouri, 1974. erty Owners at Lakes Sherwood and Camelot. Madison: Bureau of Business Research and Ser- Mowrer, Richard. "Land Salesmen from U.S. Bilk vice, University of Wisconsin, July 1973. Spain-based G,I.Is." Christian Science Monitor 130 (March 10, 1973), p. 1. ning." Urban Land (September 1972), pp. 8-13. Paulson, Morton C. "Reselling Land: Profits Rare Kusler, ion A. Survey: Lake Protection and Reha- for Second Homes Sites." National Observer bilitation Legislation in the United States. (April 20, 1974), p. 8. An Inland Lake Renewal and Shoreland Manage- ment Demonstration Project report funded by Tyson, Dorothy. America Is for Sale. New York: the Upper Great Lakes Regional Commission. Farnsworth Publishing Company, 1972. Madison: University of Wisconsin and Wiscon- sin State Department of Natural Resources, U.S. Department of Housing and Urban Development. March 1972. Buying Lots from Developers. Washington, D.C.: U.S. Government,Printing Office, 1973. "Land Use: The Rage for Reform." Time (October 1, 1973), pp. 88-89. Get the Facts Before Buying Land. Washing- ton, D.C.: U.S. Government Printing office, Levy, James L. "Vermont's New Approach to Land De- 1971. velopment." American Bar Association Journal (October 1973), pp. 1158-1160. Office of Interstate Land Sales Registra- tion. "Land Registration, Formal Procedures, Moses, Raphael J. "Water as a Tool for Recreation- and Advertising Sales Practices, and Posting al Land-Use Planning." Syracuse Law Review of Notices of Suspension." Federal Register 24: 3 (Summer, 1973), pp. 1047-1056. 38: 170, Part II, Washington, D.C., Septern- ber 4, 1973. Noone, James A., and Woolley, Barbara B. "New Fed- eral Program Seeks to Aid States in Control of Statement of Record and Property Report: Coastal-Area Exploitation." National Journal Sample Subdivision Filing for the Office of (December 9, 1972), pp. 1889-1898. Interstate Land Sales Registration. Washing- ton, D.C.: October 1973. O'Mara, Paul. "The Coast Becomes Protected." Planning (March-April 1973), pp. 24-27. Wolff, Anthony. "Invest in the West: New Yorkers Fall for the Land Con." New York Magazine "Recent California Planning Statutes and Mountain (September 1972). Area Subdivisions: The Need for Regional Land-Use Control." Ecology Law Quarterly "Subdividing the Reservations." Planning (Winter,1973), pp. 197-244. (December 1973), pp. 19-23. Rogal, Brian. Subdivision Iarovement Guarantees. Planning Advisory Service Report No. 298, @REGULATION Chicago: American Society of Planning Offi- cials, January 1974. Bosselman, Fred, and Callies, David. The Quiet Revolution in Land-Use Control. Prepared for Rubino, Richard G. "An Evaluation: Florida's the Council on Environmental Quality. Wash- Land-Use Law." State Government (summer, ington, D.C.: November 1971. 1973) pp. 172-179. Carlson, Richard James. "Remote Recreational De- Rubino, Richard G. and William R. Wagner, The velopments: The Identification of Control State's Role in Land Resource Management. Approaches Based on an Evaluation and Analy- Lexington, Ky.: Council of State Governments, sis of-Recreational Subdivisions in Avery and January 1972. Watauga County, North Carolina." Unpublished masters thesis, University of Tennessee, June Solberg, Erling D., and Pfister, Ralph R. Rural 1974. Zoning in the United States: Analysis of En@ abling Legislation. Miscellaneous Publication Carter, Luther J. "Land Use Law (II): Florida Is no. 1232. Washington, D.C.: Economic Re- a Major Testing Ground." Science (November search Service, U.S. Department of Agricul- 30, 1973), pp. 902-908. ture, 1972. Deal, David T. Public Law and Land-Use Controls: "Special Report: A Summary of State Land-Use The Massanutten Mountain Area, a Case in Laws." Land-Use Planning Reports 1: 1 (March Point. Based on a study conducted in conjunc- 12, 1973), pp. 6-9. tiori with the Environmental Law Program of George Washington University. Washington, "Special Report: How the States Struggle to Keep D.C.: Spring 1972. 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Homer Fieldhouse Associates. Recreation Land De- Paulson, Morton C. The Great Land Hustle. Chicago: velopment. Prepared for the Bureau of Recre- Henry Regnery Company, 1972. ation, Division of Economic Development, Wis- consin Department of Local Affairs and Devel- Public Land Law Review Commission. one-Third of the opment. Madison: 1967. Nation's Land. Washington, D.C.: U.S. Govern- ment Printing Office, June 1970. "In Pursuit of the Second Home." Newsweek (April 17, 1972), pp. 84-85. Ragatz, Richard Lee. "Vacation Housing: A Missing Component in Urban and Regional Theory." Land Interagency Committee for Outdoor Recreation. Economics 46: 2 (May 1970), pp. 118-126. Second Homes in Washington. Summary Report based on a survey and information compiled by Reilly, William K., ed. The Use of Land: A Citi- Carolina Feiss. Pullman: Cooperative Exten- zens' Policy Guide to Urban Growth. 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"Development Boom in Southeast Working Paper no. 1. Prepared for the Asso- Florida Megalopolis Creates a Host of Urban ciation of Towns of the State of New York, Ills." New York Times (April 22, 1973). Annual Meeting, February 8, 1972, New York City. Voorheesville, N.Y.: Cooperative Ex- Northern Environmental Council. Can We Prevent tension, Community Resource Development, Cor- Future Chaos From Recreational Land Develop- nell Regional Office, 1972. 133 222-87B 0 - 77 - 10 Wilkins, Michael H. "Recreation-Residential Subdi- Wilkins, Michael H., and Ragatz, Richard L. "cul- vision and Development Activities in Deschutes tural Changes and Leisure Time." Leisure To- County, Oregon." Unpublished masters thesis. day 1: 1 (February 1972). University of Oregon, 1971. Wolff, Anthony. Unreal Estate. San Francisco: Sierra Club, 1973. 134 APPENDIX A Recreational Land Subdivisions, Lots, and Acres Filed with the U.S. office of Interstate Land Sales Registration Ranked in Order of Number of Lots 1974 State Recreational Land Recreational Lots Acres Subdivisions United States 3,900 3,375,621 7,146,229 1. Florida 547 919,672 1,942,155 2. Texas 463 717r239 876,390 3. New Mexico 81 342,341 1,030,208 4. Arizona 426 260,728 467,015 5. California 252 159,944 622,329 6. Colorado 214 87,810 824,700 7. Pennsylvania 136 75,146 135,435 8. Virginia 112 57,019 85,303 9. Missouri 137 54,538 64,715 10. Arkansas 76 52,695 101,449 11. Tennessee 64 45,577 52,057 12. Michigan ill 44,710 67,713 13. Mississippi 38 44,686 32,297 14. North Carolina 127 38,424 92,204 15. Georgia 55 35,380 42,369 16. Nevada 33 34,129 70,208 17. Ohio 34 32,648 21,725 18. Washington 88 26,682 53,408 19. Hawaii 30 24,454 67,944 20. West Virginia 28 23,817 10,753 21. Illinois 26 22,317 35,328 22. Indiana 34 22,190 13,341 23. Maryland 50 21,975 29,061 24. Kentucky 60 20,863 30,033 25. Oregon 38 17,453 30,695 26. Oklahoma 53 16,644 13,003 27. Utah 45 15,257 49,247 28. Louisiana 44 15,1'62 8,888 29. New Jersey 20 14,676 8,377 30. South Carolina 39 13,058 40,027 31. Kansas 15 12,198 5,817 32. Iowa 23 11,930 10,294 33. Alabama 30 11,896 12,904 34. Wisconsin 50 10,524 30,617 35. Maine 29 10,267 23,003 36. Minnesota 17 9,464 21,891 37. Massachusetts 39 9i290 7,860 38. New Hampshire 51 8,298 23,350 39. New York 15 7,083 10,492 40. Vermont 27 6,756 20,080 41. Idaho 43 5,901 14,735 42. Nebraska 9 3,990 4,863 43. Delaware 17 3,801 1,247 44. Montana 22 2,828 20,688 45. Connecticut 4 2,155 2,958 46. Wyoming 8 1,276 12,607 47. Alaska 3 553 1,536 48. South Dakota 4 377 3,000 49. North Dakota 0 0 0 50. Rhode Island 0 0 0 Source: U.S. Department of Housing and Urban Development, office of Interstate Land Sales Registration, Unpublished material obtained from the files, January, 1974. 135 APPENDIX B Second Homes by Number, Per Cent of Total Second Homes, and Per Cent of Total Housing Units, Ranked by Number Per State United States, 1970 State Secon d Per Cent of Total Second Total Second Homes As A Homesi Homesl (Per Cent of Housing Per Cent of Total 2,143,434) Units Housing Units United States 2,143,434 100.0 68,418,094 3.1 1. Michigan 188,864 8.8 2,954,451 6.4 2. New York 181,138 8.5 6,298,385 2.9 3. Texas 130,580 6.1 3,825,299 3.4 4. Wisconsin 100,336 4.7 1,472,257 6.8 5. California 96,639 4.5 6,994,533 1.4 6. Pennsylvania 92,813 4.3 3,924,503 2.4 7. Minnesota 83,855 3.9 1,276,082 6.6 8. Maine 73,562 3.4 397,140 18.5 9. North Carolina 66,811 3.1 1,641,131 4.1 10. Missouri 64,330 3.0 1,673,332 3.8 11. New Jersey 61,033 2.9 2,387,535 2.6 12. Massachusetts 51,746 2.4 1,890,319 2.7 13. Ohio 47,936 2.2 3,465,161 1.4 14. Virginia 46,525 2.2 1,492,887 3.1 15. Indiana 45,367 2.1 1,730,020 2.6 16. Washington 45,010 2.1 1,220,447 3.7 17. New Hampshire 43,908 2.1 280,962 15.6 18. Florida 41,735 2.0 2 526,536 1.7 19. Illinois 38,722 1.8 3:701,866 1.1 20. South Carolina 36,242 1.7 812,148. 4.5 21. Colorado 35,467 1.7 757,053 4.7 22. Georgia 33,683 1.6 1,471,132 2.3 23. Kentucky 33,332 1.6 1,064,436 3.1 24. Tennessee 32,680 1.5 1,300,183 2.5 25. Alabama 32,663 1.5 1,120,219- 2.9 26. Louisiana 30,833 1.4 1,150,313 2.7 27. Iowa 29,192 1.4 958,560 3.1 28. Mississippi 28,364 1.3 699,168 4.1 29. Maryland 28,014 1.3 1,248,747 2.2 30. Oklahoma 27,758 1.3 925,238 3.0 31. Arkansas 27,658 1.3 675,593 4.1 32. Vermont 27,291 1.3 165,068 16.5 33. West Virginia 26,230 1.2 597,266 4.4 34. Oregon 20,946 1.0 744,602 2.8 35. Kansas 20,724 1.0 791,022 2.6 36. Nebraska 18,521 .9 514,617 3.6 37. Arizona 16,380 .8 584,116 2.8 38. Montana 16,225 .8 246,603 6.6 39. Idaho 15,335 .7 244,681 6.3 40. Connecticut 15,325 .7 980,849 1.6 41. South Dakota 15,000 .7 225,183 6.7 42. New Mexico 14,527 .7 325,715 4.5 43. North Dakota 14,301 .6 256,222 5.6 44. Rhode Island 9,974 .4 317,193 3.1 45. Delaware 8,134 .3 180r212 4.5 46. Utah 7,979 .3 315,734 2.5 47. Alaska 6,705 .3 88,428 7.6 48. Wyoming 5,711 .3 116,323 4.9 49. Nevada 4,277 .2 172,558 2.5 50. Hawaii 3,053 .1 216,066 1.4 lSecond homes are enumerated by combining the United States Bureau of the Census categories,"Rural Seasonal Vacant" and "Other Rural Vacant." This combination basically includes housing units which are intended for occupancy during only certain seasons of the year. Source: United States Department of Commerce, Bureau of the Census, U.S. Census of Housing, 1 970 De- tailed Housing Characteristics (Washington: Government Printing Office, 1972), Final Report HC(l)- B1-52, Table 32. 136 APPENDIX C Households Owning Second Homes, Ranked by Number per State, United States, 1970 Per Cent of Total Households Owning State Total Households Households Owning Per Cent of Total a Second Homel a Seco Ind Home Households (% of 2,889,771) United States 63,446,641 2,889,771 4.6 100.0 1. New York 5,913,861 289,164 4.9 10.1 2. California 6,573,861 264,342 4.0 9.1 3. Michigan 2,654,059 185,778 7.0 6.4 4. Texas 3,433,996 164,785 4.8 5.7 5. Pennsylvania 3,702,304 153,jll 4.1 5.4 r. .Florida 2,284,786 146,020 6.4 5.1 7. Massachusetts 11759,692 112,962 6.4 3.9 8. Illinois 3,502,138 110r933 3.2 3.8 9. Ohio 3,289,432 105,129 3.2 3.6 10. New Jersey 2,218,182 101,680 4.6 3.6 11. Minnesota 1,153,946 6.7 2.7 12. Wisconsin 1,328,804 76,216 5.7 2.6 13. Washington 1,105,587 65,376 .5.9 2.3 14. Indiana 1,609,494 59,506 3.7 2.1 15. North Carolina 1,509,564 56,265 3.7 1.9 16. Missouri 1,520,567 55,750 3.7 1.9 17. Virginia 1,390,636 53,133 3.8 1.8 18. Georgia 1,369,225 50,380 3.7 1.7 19. Louisiana 1,052,038 46,877 4.5 1.6 20. Connecticut 933,269 45,777 4.9 1.6 21. Alabama 1,034,113 43,108 4.2 1.5 22. Maryland 1,175,073 42,990 3.7 1.5 23. Tennessee 1,213,187 38,451 3.2 1.3 24. Arizona 539,157 36,674 6.8 1.3 25. Maine 302,923 35,666 11.8 1.2 26. South Carolina 734,373 34,829 4.7 1.2 27. Colorado 690,928 34,775. 5.0 1.2 28. Kentucky 983,665 32,601 3.3 1.1 29. Oklahoma 850,803 31,151 3.7 1.1 30. Iowa 896,311 30,104 3.4 1.0 31. Oregon 691,631 30,032 4.3 1.0 32. West Virginia 547,214 23,999 4.4 .8 33. Kansas 727r364 22,925 3.2 .8 34. Mississippi 636,724 20,154 3.2 .7 35. Arkansas 615,424 19,863 3.2 .7 36. New Mexico 289,389 18r671 6.5 .6 37. New Hampshire 225,378 17,345 7.8 .6 38. Montana 217,304 15,983 7.4 .6 39. Nebraska 473,721 15,207 3.2 .5 40. Rhode Island 291,965 13,337 4.6 .5 41. District of Columbia 262,538 12,905 4.9 .4 42. Idaho 218,960 12,641 5.8 .4 43. Utah 297,934 12,222 4.1 .4 44. Vermont 132,098 11,835 9.0 .4 45. North Dakota 181,613 10,562 5.8 .4 46. Delaware 164,804 9,517 5.8 .3 47. South Dakota 200,807 9,410 4.7 .3 48. Hawaii 203,088 8,463 4.2 .3 49. Alaska 79,059 8,389 10.6 .3 50. Nevada 160,052 8,139 5.1 .3 51. Wyoming 104,600 7,340 7.0 .3 Source: Uni ted States Department of Commerce, Bureau of the Census, U.S. Census of Housing, 1970, Detailed Housing Characteristics (Washington: Government Printing Office, 1972), Final Report HC(l)-BI-52, Table 37. 137 APPENDIX D Shifts in the Distribution of Second Homes By State, 1950, 1960, and 1970, and Per Cent Change 1950-1970 and 1960-1970 Difference in Difference in State Per Cent of Total Second Homes in United States Pe.r Cent: Per Cent: 1950 1960 1970 1950-1970 1960-1970 1. Michigan 9.6 8.5 8.8 - .8 .3 2. New York 15.4 12.9 8.5 -6.9 -4.4 3. Texas 4.1 4.0 6.1 2.0 2.1 4. Wisconsin 5.0 4.5 4.7 - .3 .2 5. California 5.6 6.3 4.5 -1.1 -1.8 6. Pennsylvania 4.2 4.4 4.3 .1 - .1 7. Minnesota 3.9 4.0 3.9 0 .1 8. Maine 3.6 3.4 3.4 - .2 0 9. North Carolina 1.3 1.9 3.1 1.8 1.2 10. Missouri 1.2 1.8 3.0 1.8 1.2 11. New Jersey 7.5 6.3 2.9 -4.6 -3.4 12. Massachusetts 5.4 4.6 2.4 -3.0 -2.2 13. Ohio 2.2 2.1 2.2 0 .1 14. Virginia .9 1.2 2.2 1.3. 1.0 15. Indiana 2.1 2.0 2.1 0 .1 16. Washington 2.1 1.9 2.1 0 .2 17. New Hampshire 2.3 1.8 2.1 - .2 .3 18. Florida 2.4 3.8 2.0 - .4 -1.8 19. Illinois 1.9 1.9 1.8 - .1 - .1 20. South Carolina .7 1.1 1.7 1.0 .6 21. Colorado 1.9 1.3 1.7 - .2 .4 22. Georgia- .7 1.2 1.6 .9 .4 23. Kentucky .4 .8 1.6 1.2 .8 24. Tennessee .5 .8 1.5 1.0 .7 25. Alabama .6 1.0 1.5 .9 .5 26. Louisiana .6 1.1 1.4 .8 .3 27. Iowa .7 .9 1.4 .7 .5 28. Mississippi .6 .9 1.3 .7 .4 29. Maryland 1.7 1.3 1.3 .4 0 30. Oklahoma .5 .9 1.3 .8 .4 31. Arkansas .7 1.0 1.3 .6 .3 32. Vermont 1.0 1.0 1.3 .3 .3 33. West Virginia .4 .7 1.2 .8 .5 34. Oregon 1.2 .9 1.0 .2 .1 35. Kansas .4 .6 1.0 .6 .4 36. Nebraska .3 .5 .9 .6 .4 37. Arizona .5 .7 .8 .3 .1 38. Montana .5 .7 .8 .3 .1 39. Idaho .5 .7 .7 .2 0 40. Connecticut 2.2 1.7 .7 -1.5 -1.0 41. South Dakota .3 .4 .7 .4 .3 42. New Mexico .4 .5 .7 .3 .2 43. North Dakota .2 .4 .6 .4 .2 44. Rhode Island 1.1 .8 .4 .7 .4 45. Delaware .3 .3 .3 0 0 46. Utah .2 .3 .3 .1 0 47. Alaska -- .2 .3 -- .1 48. Wyoming .2 .3 .3 .1 0 49. Nevada .1 .1 .2 .1 .1 50. Hawaii -- .1 .1 -- 0 Sources: U.S. Department of Commerce, Bureau of the Census: (1) U.S. Census of Housing: 1950, United States Summary (Washington: Government Printing Office, 1953), Final Report H-Al, Table 17, ("Seasonal Vacant Dwelling Units"); (2) U.S. Census of Housing, 19 60, States and Small Areas, United States Sum- mary (Washington: Government Printing Office, 1963), Final Report HC(l)-l, Table 3, ("Units Held for Occasional Use" minus "Vacant for Migratory Workers" plus "Other Seasonal Vacant Units"); (3) U.S. Cen- sus of Housing, 1970, Detailed Housing Characteristics, United States Summary (Washington: Government Printing Office, 1972), Final Report HC(l)-Bl, Table 32, ("Rural Vacant" plus "Other Rural Vacant"). 138 Appendix E Estimated ownership of Recreational Properties by Type of Property and Region of the U.S., 1973 Type of Property United Northeast North South West States Central Number of Households 67,430,000 16,075,000 18,451,000 20,825,000 12,079,000 Number of Households Owning 5,732,000 1,410,000 1,462,000 1,712,000 1,148,000 Recreational Properties Per Cent of Total Households 8.5 8.8 7.9 8.2 9.5 in Region Number of Households Owning Vacant Recreational Lots for 877,000 199,000 240,000 249,000' 189,000 Speculation/Investment Per Cent of Total Households 1.3 1.2 1.3 1.2 1.6 in Region Number of Households Owning Vacant Recreational Lots for 1'@16'000 298,000 357,000 461,000 300,000 Future Building Per Cent of Total Households 2.1 1.9 1.9 2.2 2.5 in Region Number of Households Owning Single Family Detached Second 3,237,000 864,400 813,400 926,300 632,900 Homes Per Cent of Total Households 4.8 5.4 4.4 4.5 5.2 in Region Number of Households Owning 202,000 48,200 61,800 65,800 26,200 Resort Condominium Units Per Cent of Total Households in Region .3 .3 .3 .3 .3 Source: Unpublished survey designed by Richard L. Ragatz and conducted for this study by the Opinion Re- search Corporation, Princeton, N.J., October, 1973, using a stratified sample of 7,190 U.S. house- holds. Data on numbers of households was obtained from the U.S. Department of Commerce, Bureau of the Census, Demographic Projections for the United States (Washington: Government Printing office, 1973). Current Population Reports, Series P-25, No. 476, Tables 7 and E, pp. 25-26. 139 U.S. GOVERNMENT PRINTING OFFICE 1976 0-222-878 Other CEQ Land Use Studies Available at U.S. Government Printing Office: Subdividing Rural America@lmpacts of Recreational Lot and Second Home Development Executive Summary by the American Society of Planning Off icials, 1976 The Growth Shapers-The Land Use Impacts of Infrastructure Investments, by Urban Systems Research & Engineering, Inc., 1976 Untaxing Open Space-An Evaluation of the Effectiveness of Differential Assessment of Farms and Open Spaces Executive Summary Analysis by the Regional Science Research Institute, 1976 Recreation on Water Supply Reservoirs: A Handbook for Increased Use, by Urban Systems Research & Engineering, Inc., 1975 The Delaware River Basin-An Environmental Assessment of Three Centuries of Change, 1975 Land Use (Reprinted from the Fifth Annual Report of the Council on Environ- mental Quality), 1974 Potential onshore Effects of Oil and Gas Production on the Atlantic and Gulf of Alaska Outer Continental Shelf, Volume IV of OCS Oil and Gas-An Environ- mental Assessment, by Resource Planning Associates, Inc., and David M. Dornbusch & Co., 1974 The Costs of Sprawl: Environmental and Economic Costs of Alternative De- velopment Patterns at the Urban Fringe Executive Summary Detailed Cost Analysis Literature Review and Bibliography prepared for CEQ, HUD, and EPA by Real Estate Research Corporation, 1974 The Taking Issue-An Analysis of the Constitutional Limits of Land Use Control, by Fred Bos'selman, David Callies, and John Banta, 1973 @ The Quiet Revolution in Land Use Control-Summary Report, by Fred Bossel- man and David Callies, 1971 Available at National Technical Information Service U.S. Department of Commerce: The Costs of Sprawl: Case Studies and Further Research, prepared for CEQ and HUD by Real Estate Research Corporation, 1976 Interceptor Sewers and Suburban Sprawl Volume 1: Analysis Volume 2: Case Studies by Urban Systems Research & Engineering, Inc., 1974 Recreational Properties: An Analysis of the Markets for Privately Owned Recreational Lots and Leisure Homes, by Richard L. Ragatz Associates, Inc., 1974 Total Urban Water Pollution Loads: The Impact of Storm Water, by Enviro Con- trol, Inc., 1974 . Potential Onshore Effects of Deepwater Oil Term i na I-Related Industrial Development Volume 1: Executive Summary Volume [I: Mid-Atlantic Region and Maine Volume III: Gulf Coast Region Volume IV: Appendices by Arthur D. Little, Inc., 1973 Land Use Change and Environmental Quality,in Urban Areas: Some Com- parative Studies (Denver, Los Angeles, Kansas City, Baltimore, Riverside/ San Bernardino), by Earth Satellite Corporation, 1973 In preparation: Land use impacts of federal taxes Land use inside cities Costs OT metropolitan development patterns Secondary impacts of western energy development COASTAL ZONE INFORMAMON CENTER I @ -1 0- 3 6668 00002 5