Letter from Chip Northrup

More Thoughts on Subdivisions

Say the median home price in the proposed Manocherian land development is $600,000.00, with an assessed value of $420,000.00. New York townships get about 20 percent of the total property tax for houses outside of villages, so for the Town of Otsego that’s .20 x 1.70 = .34 and for the Town of Springfield .20 x 1.40 = .28 percent, or .0028 of the assessed value. For each completed house in the subdivision, Springfield would get 420K x .0028 = $1,176.00 per year, of which a fraction would be allocated to road maintenance, say half, or $588.00, for roads. Most of the planned development is accessed by seasonal roads. In order for lots to be sold and houses built, the roads will need to be paved. Even if the developer pays for all the road improvements up front, the towns will still be obligated to maintain the roads—including plow them, maintain and repair them, etc. for about $600.00 a year.

Most of the property is in the Town of Otsego. Most of the lots are to be cut off of existing seasonal roads. In order to access lots near the town line, each town will have to improve and maintain several miles of roads to provide year-round access to the new houses. For that obligation, Springfield would get $600.00—if the house is on its side of the town line. If the house is on the Otsego side, Springfield would get nothing to maintain the township roads to it. Vice versa for Otsego—it has zero tax revenue to maintain a town road to a house that’s across the line in Springfield.

Since the demand for remote, viewless houses in the woods is not particularly strong, both of the towns could end up with the privilege of maintaining a whole lot of roads to a few developed lots for a whole lot of nothing for a whole long time. Welcome to the land development speculation racket.

The most cost-effective form of subdivision for a developer—cutting speculative development lots off a rural public road—is the least cost-effective for a municipality. The most publically cost-effective, environmentally responsible way to develop land is by utilizing existing public infrastructure—municipal water and sewer systems and roads—not burden townships, school districts and EMS with servicing remote, low density, publicly uneconomic, environmentally harmful speculative land developments.

Chip Northrup
Cooperstown and Texas