State-wide results indicate that brokers are split on their judgment of the ESA's effect on sales volume. Most respondents (84 percent) either indicated no change or unknown for the effect on built-up urban real estate. However, sizable minorities (40 to 45 percent) indicated a perceived dip in volume as a result of the ESA during the past five years for developed vacant land, urban fringe land and transitional rural land. Few respondents had observed increases in sales volume (0.6 to 3.0 percent). These results lead to the conclusion that, as a group, brokers appear to be largely uncertain about the effect of the ESA on sales volume. However, sizable minorities have discerned declines in value associated with ESA. Furthermore, those minorities are located in areas where the act has attracted the greatest attention, leading to the conclusion that the effect is uneven across Texas. Most of the value loss indicated in the survey concentrated on the urban fringe and transitional land groups. The largest median value change estimates for these groups centered in the Texas Hill Country (40 percent overall decline for urban fringe and 30 percent decline for transitional lands) and the northeast corner of Texas (35 percent for urban fringe). These areas are noteworthy as areas with habitat for the golden-cheeked warbler and red-cockaded woodpecker, respectively. Additionally, panelists indicated estimated declines ranging between 10 and 20 percent for farmland and rangeland statewide. Finally, respondents forecast state-wide median declines (12.5 to 25 percent) in value for affected properties during the next five years. The report concludes: Time will reveal the extent of aggregate property value impact from the ESA. Texas brokers who are active in the market believe that the impact has been negative and will continue. While a few respondents indicate that property values have risen, the majority either do not know the impact or believe that values have declined.1o Although this reported evidence does not demonstrate a verifiable effect associated with ESA, it does indicate that a consensus among brokers foresees values falling because of the act. Property Tax Evaluation Adjustments Property value serves as the primary index of local taxation in Texas, and landowners typically seek to keep the assessed values of their properties at the lowest possible level. Although many tax bills for agricultural land are based on productivity values in agricultural use rather than the taxable market value, even owners of land taxed on agricultural use values have an incentive to keep market value estimates for these properties low to limit the potential rollback tax." For much of the land impacted by ESA, agreements between assessment authorities and the landowners are the first point where negotiated valuation adjustments appear. In 1994 owners requested valuation reductions for properties affected by a variety of endangered species including: golden-cheeked warbler, cave invertebrates, the black-capped vireo, miscellaneous other restrictions and the restrictions associated with the "Save Our Springs" program. According to the Travis County Central Appraisal District (CAD), 1994 adjustments were applied to 897 properties totaling a 43 percent reduction from the initial market values. By this estimate, these environmental restrictions resulted in a $74 million reduction in taxable market value as shown in the following table. 12 Effects of Endangered Species Act on Taxable Market Values This information closely approximates the overall decline estimated by respondents to the Jones survey. The overall decline of 43 percent is a weighted average decline with actual individual changes ranging from zero to as much as 74 percent of value. No increases were imposed because of ESA. The data also conform to judgments registered in the Jones survey specifically showing the most pronounced declines in agricultural land that is not receiving productivity valuation treatment (probably transitional and urban fringe lands) and vacant platted lots with 51 and 45 percent declines, respectively. These adjustments reflect the assessment authority's best estimate of the value effects following from ESA habitat designation. Tax values are frequently dismissed as indicators of market value for specific properties because they are based on mass appraisal techniques. This may lead to contentions that the tax valuations do not provide compelling evidence regarding ESA impact. However, the Comptroller's Office Property Tax Division indicates that the Travis County CAD appraises properties at 99 percent of market value overall, with a coefficient of dispersion of 10.99. This indicates an acceptable level of accuracy in appraisal, especially when compared with a state-wide coefficient of dispersion of 14.17. On vacant platted lots and rural real estate, Travis CAD appraised at 100 percent of market value in 1994 with coefficients of dispersion of 17.05 and 16.39, respectively, compared to statewide coefficients of 19.68 and 18.61.13 This official state study of appraisal records indicates that Travis County appraised values tend to approach market value, on average, and that those appraisals have an acceptable level of accuracy that exceeds others in the remainder of the state. Thus, the Travis County CAD staff has demonstrated a high degree of knowledge and skill in estimating property values for taxation. While this evidence does not conclusively demonstrate a substantive negative impact from ESA. it does contribute to the mounting numbers of informed real estate market participants anticipating value declines for some properties in the wake of ESA designations. Land Value Studies Information Analysis of land price data maintained by the Real Estate Center" could provide information in either of the two dimensions expected to reveal ESA's impact on value. Specifically, the data could evidence land value impact if either unexplained sales volume or price changes occurred while ESA was an issue in land markets. However, information in rural land sales studies conducted by the Center neither conclusively confirms nor denies ESA effects. Land prices in the most likely affected areas (Austin, Waco and the Edwards PlateauSouth) increased from 1992 to 1994, but the sales volume may have decreased in the AustinWaco areas. The price increases appear to contradict foreseen negative effects. However, the expected negative effects may have occurred on affected properties with the declines being swamped in market-wide data where disproportionate numbers of unaffected properties sold. Although the recorded price increases do not confirm expected price declines, neither do they effectively refute the forecast of substantial negative effects for ESA. The anticipated negative effect simply may not have appeared as a market-wide, price depressing influence for a variety of possible reasons. First, observers indicate that the most visible influence arising from ESA on affected properties appears as buyer avoidance. If buyers are indeed shying away from properties that they deem at risk for curtailed use, transactions moving through the market would contain fewer sales of affected properties. Furthermore, strong demand for land in areas that contain affected properties would be concentrated on fewer remaining unaffected acres, driving |