GIS NYS Style

On October 8, 2006, for the second year in a row I attended the New York State Geographic Information Systems Conference. (see http://www.esf.edu/nysgisconf/)  Last year my goal was to catch up with the latest whiz-bang applications after first attending the national conference (and taking a week-long workshop) in 1996. (See www.urisa.org for the national organization.) I have since learned that one needs to use these mapping programs on a regular basis to be at all proficient, so I now secure the services of others to do the work, even when I design the applications.

GIS applications are awesomely powerful, capable of illustrating arrays of data and their relationships beyond any other means.  Since an estimated 90 percent of data has a spatial dimension, these tools provide us with analyses that portray instantly the relationships, and indeed the concepts, that make arguments convincing.  Applications are growing in variety and power so fast that newly minted techies command impressive salaries.   Therefore the public sector has frequently lagged behind private enterprise in securing the people who go to the private sector to do marketing, resource analysis, planning and trending.  But the public sector is beginning to catch up, and uses in real estate planning and taxation are becoming common.  New York localities have now traced the boundaries of every property parcel in the state.  This has allowed for the mapping of land values and their comparison, what portends to be a revolution in property taxation once political leaders understand its potential.  Today, such work relies upon assessment data that is typically far from accurate.   But the maps can easily highlight the inaccuracies and anomalies in ways that spreadsheets cannot.  In due course it should be possible even to do time series analysis.

While last year my time was spent largely in attending panel presentations, this year I registered as an exhibitor and a presenter.  I was likely the only person at the conference who was not a GIS techie.  But I've learned to talk a good game, and my presentation was attended by close to a hundred people, after which I invited them to stop by my exhibit table.  Now that I am working with a proficient GIS technician, I am able to do work on the cutting edge of applications of the Georgist approaches to economics and taxation.  Rather than rewrite what appeared in the conference program, here it is below:

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NYS GIS Conference Presentation Abstract
H. William Batt, Ph.D., Bob Breglio, MRP,  Central Research Group, Inc.

This presentation shows how GIS technology can revolutionize property assessment and taxation, with radical improvements for local economies as well.

Completed creation of property parcel shape files in New York State allows for the practical representation of land value assessment beyond what has ever before been possible.  Land value maps have a history traceable to the extensive work of New York City Assessor Lawson Purdy beginning in 1909, and have been widely advocated by assessors, but they were such a labor-intensive challenge that only occasionally maintained.  GIS technology now changes all this, and portends even greater changes in the near future. 

With the separate parcel assessment of land, required by state law, land value maps are now easily and inexpensively created, at least relative to prior history.  We can not only make land value maps; we can also show the efficiency by which land sites are used by showing ratios between building to land value, or any other ratios.  Land value gradients are easily calculated, and so also the impact of infrastructure investments upon site value.  Anomalies in land assessment are quickly revealed and apparent.

Most importantly of all, simulating land value taxation can be shown -- who would pay more and who would pay less, showing how feasible such a tax regime actually is.  The accurate valuation of land separate from improvements, what has long been thought to be an obstacle to land taxation, can now be overcome.  It may even be a short step to accomplishing the task of assessment itself using various algorithms and parcel sales records in conjunction with GIS technology. 

Dr. Batt, is a former university professor and later the staff political scientist of the New York Legislative Tax Study Commission.  Retired since 1992, he has devoted his efforts entirely to effectuating tax policies built upon the school of economic philosophy of Henry George.  Mr. Breglio is a retired GIS Specialist, who worked for years for the Neighborhood Preservation Coalition of New York State  as well as being an elected town Assessor and GIS instructor at SUNY Albany. 
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The half-hour I had to talk was adequate to describe how land configurations grow out of economic activity and how the gradients of land value explain much of our property value.  The presentation may soon be online at the conference and association’s website, but several of the maps  that I used are already available at http://www.urbantools.org/research-and-studies/imaging-the-land-value-tax .  My challenge to the assembled techies was to ask them to create land value maps for every locality in the state, so that assessors could plainly see how consistent their valuations are.  A day later I was sent one such map.  Because land and improvements are now taxed at the same rate by and large, little attention is typically given to the division between them.  The only thing that matters is that the total valuations are right.  By mapping only the land values, it becomes quickly and easily apparent when the values assigned are wanting.  Moreover, because buildings depreciate, any increase in the parcel values is due to the land. (A 2006 St Louis Federal Reserve Bank study by Davis and Palumbo calculated the building decline at about 1.5 percent yearly.)  So parcel valuations are quickly out of whack unless assessments are done frequently.  In New York, a new law requires assessments be done at least once every five years, far different than what has been the case historically.  Troy, for example, has not had a revaluation for 29 years, and it looks like it is going to put off the task once more given its current fiscal difficulty.  My city of Albany finally did a revaluation in 1995 after going almost five decades without performing the job.  Even then assessments were so slipshod that two subsequent updates still have not adequately adjusted to real market prices. 

With effort, I’ve found land value maps in many places.  One map, taken from a study of metropolitan New York done recently by the New York Federal Reserve Bank (Current Issues in Economics and Finance, Vol 14, No 3, 2008), was based not on assessments but on the records of recent sales.  The study showed that recent values in mid-town Manhattan reached levels of $12,600 per square foot!  I found another book written in 1903 – Richard Hurd’s, Principles of City Land Values -- that calculated the values of land parcels in several major American cities, both at the epicenter of economic activity and further out.  As laborious and expensive as that work was a century ago, today's GIS technology makes its performance simple and quick.  What is most exciting of all is the prospect that sales data could soon be fed into assessment roll databases instantaneously, and that "real time" land value maps could provide a running record of land value configurations much as weather maps and other spatial data is maintained.  Think about the possibility that the assessed value of land parcels could be performed for pennies compared to the hundreds of dollars that such tasks cost today.

To be sure, the technology will not be applied absent a better understanding of land economics and taxation theory.  But what was at one time an enormously expensive task, the valuation of sites, together with what was nothing more than a plausible and theoretical economic paradigm, is today empirically demonstrable and inexpensively applicable.  This is an exciting time for Georgist economics, and current financial crises beg for its dissemination.  I’m in the process of now of writing a short history of land value maps and how it has happened that they we employed more commonly a century ago than they are today.  And this is now what I hope to help change.