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The Changing Rural LandscapeRobert G. Healy & James L. Short aa Real Estate and land studies , San Diego State University , USAPublished online: 08 Jul 2010.

To cite this article: Robert G. Healy & James L. Short (1981) The Changing Rural Landscape, Environment: Science andPolicy for Sustainable Development, 23:10, 6-34

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Rural Landscape by Robert G. Healy & James L. Short

omething has happened in rural America. Perhaps the S first inkling came in the late

1960s, when government tabulations revealed that manufacturing employ- ment had started to grow more rapidly in the countryside than in metropolitan centers. About the same time, public perceptions of the countryside were changing-from images of poverty and backwardness to sometimes romanti- cized visions of the good life rural America seemed to offer-a slower pace, a less-polluted environment, an opportun- ity for individual self-expression. More recently has come a rather surprising finding of demographers that, starting about 1970, nonmetropolitan counties, including some far from the influence of any big city, were growing faster than metropolitan ones.

Farming, long dominant in the rural economy, has also been changing, both in character and in relative importance. Today, only 1 rural resident out of 10 lives on an operating farm. Even among farmers, more than half of aggregate income in most recent years has been derived from off-the-farm sources.

iij

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The interstate highway system has vastly expanded the typical rural dwel- ler’s access to shopping, to medical ser- vices, and to places of employment. And housing in rural areas recently has been built at a rate more than twice that of urban areas. The popular mental image of rural American life, with its emphasis on farming and its expectation of stability or decline, increasingly is out of joint with reality.

About the same time that rural America began to change in new direc- tions, our need for its traditional pro- ducts-food, wood, water, and recrea- tion-began to quicken. The massive increases in U.S. grain exports which began in 1973 put a sudden end to dec- ades of farm surpluses. Extremely rapid rises in timber prices through much of the 1970s helped exacerbate fears that the average American family might soon be unable to afford a new single-family house. The explosion of interest in out- door recreation activities of all sorts put great pressures on public lands and led many to wonder if private land could fill the gap.

The Rural Land Market

There are about 10 acres of rural land for each American. If the vast hold- ings of federal, state, and local govern- ments are ignored, there would still be about 6 acres per capita-a bit less than 1.3 billion acres. This privately owned land produces nearly all of the nation’s food and two-thirds of its timber. It provides water, recreation, grazing, min- erals, and wildlife habitat. It represents a large, and probably rising, proportion of the national wealth.

The bulk of our privately owned rural land (about 75 percent) is con- trolled by less than 5 percent of the pop- ulation. Each day, thousands of owners buy or sell it or make decisions as to its use. In doing so, they are principally motivated by personal preferences and by market forces, for government regu- lations on rural land are few. The iden- tity and motivations of these rural land- owners have been two of the great unknowns in land-use policy.

It is clear from even casual observa- tion that rural landowners are not just farmers, interested solely in cultivating

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Bob Laramie

land for the products it can yield. To- day, rural landowners may be recre- ationists, using small tracts of rural land for weekend or summer recreation. They may be retirees or people fed up with the hectic pace of city life. They may be speculators, holding rural prop- erty in anticipation of future urban growth. Moreover, traditional rural owners, such as farmers and timber companies, are increasingly aware that the real profits in land have been com- ing from appreciation in its price, rather than from using it to produce com- modities.

Decisions made by individual pri- vate landowners have an important, and sometimes irreversible, effect on the productivity and the beauty of the American countryside. Thus, it is essen- tial for conservationists, policymakers, and all concerned with land use to understand the rural land market-how it works, how it is changing, what it implies for public policy. Yet despite ,

the fact that landownershp and land- transfer information is a matter of pub- lic record in local communities, there has been no comprehensive study of the rural land market. Particularly lack- ing has been a treatment that deals with all types of rural land-farm, forest, recreational-and that is nationwide in its scope.

This article, which is based on newly available government data and our own

studies in six widely separated rural areas, is an attempt to offer a new, land- oriented perspective on the far-reaching changes that have recently been occur- ring throughout rural America. As a result of our studies,’ we have docu- mented three important trends that have dominated the rural land market for at least the last decade. These trends cut across all types of rural land and are found in nearly all parts of the country. They are setting the stage for vast eco- nomic, physical, and social changes.

Trends The first, and most dramatic, trend

has been a spectacular rise in the price of all types of rural properties. Since 1950, the per-acre price of farmland has risen eightfold.’ This has been a rate of increase nearly three times as rapid as the rate of overall inflation. Prices of timberland and of land with high scenic or recreational quality are difficult to document, but available evidence indi- cates that the rate of appreciation has been even more rapid for them than for farmland.

Second, there has been a broadening in the motives for purchasing rural land and increased participation in the market by “nontraditional” owners. The latter are most frequently found in areas where farming and other resource-based uses of the land have long been declining be-

cause of economic factors. The new owners stand in contrast to traditional owner-operators, who viewed their land primarily as a productive asset and worked it with their own hands. Non- traditional owners include new residents who use their 5-to40-acre rural parcel as a glorified house lot; weekend and summer recreation seekers; nonresident investors interested mainly in the record of land as a successful inflation hedge; urban dwellers who have inherited land from rural relatives; and corporations seeking to increase the scale and intensity of management or to change the land’s use .3

sizes of individual landownership units. Scale economies in agricultural produc- tion have resulted in increases in the size of farm units, particularly in those areas where commercial agriculture is the dominant land use.4 Rising land values have contributed to farm expansion, for farmers who own land purchased at low prices in years past are in a good position to use their equity in purchasing even more land. Farmers have also expanded their operations by leasing land owned by retired farmers or by outside investor^.^

Even as farm size is rising in some parts of the country, in other areas land is being divided. Land divisions are particularly prevalent in areas where commercial agriculture has declined in recent decades and where farmland has been reverting to forest. The 5-to-40-acre tracts most in demand by recreational or retirement buyers are typically smaller than the traditional- sized units of rural ownership.

Rural land usually commands a much higher price when it has been divided into smaller units, and real estate agents and investors have made a profitable business of catering to this demand. We refer to the process as parcellatiod -some rural people speak of it more colorfully as “land-busting.’’ Farmers themselves have found that they can cover a bad crop year or a child’s college tuition by splitting off a roadside parcel or two for residential use.

The dynamics of the rural land mar- ket in recent years can best be explained in terms of a rising demand-increasing for an extremely broad range of reasons--

Third, there have been changes in the

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confronting a very sluggish supply. Tra- ditional landowners have generally not responded to rising land prices by increasing the amount of land that they offer for sale. This is not irrational behavior on their part, for rural land is unlike most assets in that its sale by a resident owner-operator usually means that the seller must find a new place to live and perhaps a new occupation. Therefore, demographic factors, such as death or retirement, continue to be primary determinants of the amount of rural land that comes on the market each year.’

Recently, demands for rural land have been fueled by a revival of rural population growth. Starting around 1970, for the first time in decades, the population of nonmetropolitan areas began to grow more rapidly than that of metropolitan areas. The phenomenon has many causes and can be found vir- tually nationwide. “There is no real precedent for it,” says Calvin Beale, chief demographer for the USDA. “It marks a turning point [for] our soci- ety.”8

National statistics show that between 1970 and 1980 population increased by 15.4 percent in nonmetropolitan areas and by only 9.1 percent in metropolitan areas. The nonmetropolitan growth has

This article has been adapted from The Market for Rural Land, pub- lished by the Conservation Founda- tion, 1717 Massachusetts Ave., NW, Washington, D.C. The Conservation Foundation has also produced a 16mm movie, ”Growing Pains,“ about the increasing competition between new rural development and traditional ways of life. In the movie, Tyler County, Texas, San Luis Obispo County, California, and Plainfield Township, New Hampshire, are used to exemplify both the benefits and the problems of changing rural land use. The half- hour movie is available for purchase or rental. The Conservation Found- ation is a nonprofit research and communications organization whose purposes are “to improve the qual- ity of the environment and to pro- mote wise use of the earth’s re- sources.‘’

I

FIGURE 1. Percent increase in average value of farm real estate per acre, March 1970 - February 1980.

been about evenly divided between natural increase (the excess of births over deaths) and gains due to migration.

Nonmetropolitan areas no longer seem to be losing as many of the young people who in past decades would have left for urban areas. And, in a startling reversal of long-standing population trends, nonmetropolitan areas are attract- ing new residents from cities and sub- u r b ~ . ~ The fastest growth, occurring in counties that border on metropolitan areas, is the result of “metropolitan overspill.” One factor influencing this sort of growth has been the increased availability of jobs in the suburbs, which has created a new breed of long-distance commuter from homes or farms beyond the metropolitan limits.

ever, that have shown, i fno t the fastest growth, the most marked turnaround. After high and protracted net loss of population from people moving away during the 1950s and 1960s, even coun- ties outside metropolitan commuting distances and with no city of more than 2,500 people are starting to grow. Inter- estingly, this growth is most likely to occur in remote counties that are rich in natural amenities. Many counties lack- ing such amenities are still losing popula- tion.”

demand is, of course, rapidly rising prices. The price increase, in turn, has

It is the more remote rural areas, how-

The result of static supply and rising

increased the perceived attractiveness of rural land as an inflation hedge and may have further fueled the demand for it. As a result, the current return from devoting land to farming or forestry is very low in relation to the price of the land or to the mortgage pay- ments necessary to carry it. Increas- ingly, land buyers must justify their purchase not on current return but on future land price appreciation. And to a great degree this has been forthcom- ing-for example, in the last I0 years, American farmers collectively made more money from land price appre- ciation than they did from cultivating their land.

ent from the market for most commodi- ties. Each piece of land is different-a unique combination of location, size, fertility, and scenic attractiveness. There is no single institution where land is traded, but rather a series of interconnected local markets, joined together by fitful and imperfect flows of capital and information. Data describ- ing land markets are scarce, but it ap- pears that markets are segmented by type of land as well as by region, with distinct groups of buyers and patterns of price determination for agricultural land, for timber and recreational land, and for land with urbanization potential. But despite many imperfections in the market, relative land prices are influ-

The land market itself is very differ-

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enced in more or less reasonable ways by location and by fertility. When local land prices get too high or too low relative to those in other areas, adjust- ments eventually take place.

Issues At present, the United States has a

rural land base unmatched worldwide in its combination of size and fertility- 413 million acres of cropland, 505 mil- lion acres of nonfederal pastureland and rangeland, and 407 million acres of nonfederal forestland.” But projected growth in export demand for food and in domestic demands for lumber and paper suggests that, unless we markedly increase‘yields per acre, we could before long be using all of the land that can be made available. Parcellation, changing ownership patterns, and hgh land prices could impede our future ability to ex- pand commodity production.

Land Use

The workings of the rural land mar- ke t raise two broad classes of public issues. First, there are concerns about present and future land uses. The most basic of these is how landownership affects the availability of private land for future food and fiber production. At the present time, much of the country’s rural land continues to be owned by individuals and firms who are primarily interested in keeping it productive, and

who have the skills to do so. But certain recent land-market trends, if long con- tinued, point in the direction of some serious potential problems.

0 Twenty-one percent of private forestland in the United States is held in ownership units of less than 100 acres.12 Many of these small units-and some larger ones-are owned by people more interested in recreation and ameni- ties than in managing for sustained-yield wood production. Yet increasingly, for- esters are counting on this land as a future source of national timber supply.

Foresters who deal with the rural public believe that landowners who have purchased forest tracts for recre- ation or for investment are frequently misinformed about both the economics of timber management and how it might fit into their plans. Many new, urban- oriented owners tend to view resource protection in preservationist terms rather than in terms of “conservation for use.” This leads the new owners to “conserve” the forest by not harvesting any of the trees on their property. Yet, in many parts of the country, foresters point out, the wood being conserved is of very low quality, the result of dec- ades of “high-grading’’ (selective cutting of the best timber), and it will not be much improved by the passage of time. They believe that prudent long-term management would involve heavy im- mediate harvesting and regeneration in

USDA-SCS/Harry Harden

sounder trees and more usable species. Recently, some foresters have been

advancing a new conception of “eco- logical forestry,” in which selective harvesting is used to improve wildlife habitat and scenic quality, while pro- ducing salable timber product^.'^ Per- haps this approach will begin to appeal to the owner who is not principally interested in timber production.

0 Recent rural population growth has brought about a proliferation of 2-to-I0 acre house lots, as well as 10- to-40 acre “farmettes” and “ranchettes.” Some of these occupy high-quality farm- land, newly subdivided to meet the residential demand. Such small parcels preclude commercial agriculture as we know it, and their dispersion across the countryside may also interfere with the future agricultural uses of adjoining parcel^.'^ A related land-use issue con- cerns whether the amount of land being held out of production by land specu- lators on the exurban fringe is larger than that actually required for future building needs.”

0 National data also reveal that 44 percent of farm and ranchland is owned by nonfarmers.I6 A great deal of this land is operated by farmers under short- term lease,” giving the operator little incentive to be concerned about main- taining the long-term fertility of the soil.

Still another concern is public access, for it is charged that nontradi- tional owners are likely to post land against hunting, fishing, and other pub- !ic uses long allowed by informal arrange- ment among local residents.

Landowner changes also can have an impact on landscape aesthetics, by a change in the pattern of cultivation (for example, the reversion of cropland to forest) or by the construction of fences, houses, and roadside commercial struc- tures.I8

Structure of Ownership

how the structure of landownership affects the economy and society of rural areas. Land is one of the chief sources of rural wealth, and the ability to con- trol its use is closely connected with economic power, social standing, and sometimes even political influence.

A second broad class of issues involves

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0 Growing foreign ownership of U.S. farmland recently became a political issue, although new surveys taken under a federal reporting law indicate its actual extent is still quite ~ma1l . l~ Concentra- tion of rural landownership in the hands of corporations and other absentee own- ers has brought controversy to many parts of the country, including Appa- lachia, Maine, and California. Both for- eign and corporate ownership are part of the larger issues of ownership concen- tration and resident versus absentee control.

Another set of issues involves the impacts, both positive and negative, of second homes and of rural population growth on the rural way of life. For example, it has been charged that new- comers have forced land prices in some rural areas to levels beyond the reach of local people who wish to buy land for farming or for homesites.

0 Finally, a wide-ranging debate is now occurring on the “structure of agriculture,” including consideration of the desirable size of farm units, the participation of nonfarm capital in agriculture, access to land for young farmers and for minorities, and the role of farming in a rural society in which farmers make up only a small minor- ity of rural residents.

Rural Places In an effort to learn more about

both land-market trends and the issues they raise, we chose six areas for inten- sive study: Loudoun County, Virginia (outlying portion); Tyler County, Texas; Hardy County and Pendleton County, West Virginia; Douglas County, Illinois; Plainfield township, New Hampshire; and San Luis Obispo Coun- ty, California. Together, they illustrate a continuum of remoteness, ranging from places just beyond the metropoli- tan fringe to places quite distant from any metropolis. And they include ex- amples of both fertile and marginal farmland, hardwood and softwood timberland, and land in demand for recreational and rural settlement.

In choosing these sites, we used a series of clear but flexible guidelines. First, each area had to be truly “rural.” Built-up areas, except for very small

According to the dictionary, rural refers to sparsely settled or agricultural areas, as distinct from settled communities. In practice, it seems easiest sim- ply to think of rural land as whatever is not urban.

This convention is followed by the U.S. Census Bureau, which defines as urban all incorporated or unincorporated places with populations of over 2,500, as well as densely populated areas on the fringe of large cities. Accord- ing to provisional census counts, the United States in 1980 contained 167.0 million urban residents. Since the total population was 226.5 million, this left 59.5 million rural residents. At the time of writing, 1980 figures for the amount of urban and rural land were not yet available. In 1970, urban land totalled 35 million acres or about 1.8 percent of the nation’s land area (ex- cluding Alaska and Hawaii). If urban densities did not change, urban popula- tion growth between 1970 and 1980 would make the nation’s urban land area in the latter year approximately 39 million acres, still leaving more than 98 percent of the nation’s land rural.

U.S. FARM, RURAL, AND URBAN POPULATIONS, SELECTED YEARS, 1790-1980 (in millions)

YEAR FARM RURAL URBAN TOTAL

1 790

1850 1880 1910 1920 1930 1940 1950 1960 1970 1 980

1820 + + +

22.0 32.1 32.0 30.5 30.5 23.0 15.6 9.7 6.1a

3.7 89

19.6 36.1 50.2 51 B 54.0 57.5 54.5 54.1 539 59.5b

.2

.7 3.5

14.1 42.1 54.3 69.2 74.7

125.3 149.3 167.0b

96.8

3.9 9.6

23.2 50.2 92.2

106.0 123.2 132.1 151 -3 179.3 203.2 226.5

Source: USDA, Rural 0w.lopmont P.np.ctivos (March 1980); US. Bureau of tho Census, 1980 Census of Population; USDA, US. Farm Population. 1S80.

*Data not available.

a. Figure for 1980 based on curront definition of “farm.” Figure would bo &out

b. Provisional figure. 1.3 million hlgher if pre- 1978 definitlon wem used.

villages, were excluded. Moreover, open areas where land values .were signifi- cantly influenced by nearby urban de- velopment were also excluded. Loudoun County lies within a metropolitan sta- tistical area, but the portion of the county selected for study is, both on paper and on visual inspection, very rural, and it is an hour and a half com- mute to central Washington, D.C.

Second, each area had to be repre- sentative of its regional land market. Thus, in type of land and in the sources of demand for land, Hardy and Pendle- ton counties are similar to at least seven other counties in the Potomac High- lands area of West Virginia. Tyler and

Douglas Counties are representative in many ways of other rural counties within a 50-mile radius.

Third, each area had to illustrate a nationally common type of land or type of land-market trend. Douglas County exemplifies hundreds of other counties where commercial farming is still the dominant land use. Tyler County does the same with respect to softwood timber. Loudoun County has much in common with other exurban jurisdic- tions around the country, while Hardy County is like many areas experiencing the effects of widespread interest in outdoor recreation. Plainfield and San

(continued on page 30)

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6. S. F. Cook, Jr., “Topographic analysis of the Clear Lake Gnat problem,” Pan Pacific Entomologist 39 (1963): 98-102.

7. S . F. Cook, Jr., “The potential role of fish- ery management in the reduction of chaoborid midge populations and water quality enhance- ment,” Calif. Vector Views 15 (1968): 63-70.

8. S. F. Cook, Jr.. J. D. Conners. and R. L. Moore, “The impact of the fishery on the midge populations of Clear Lake, Lake County, California,” Annals Entomol. Soc. Amer. 57 (1964): 701-707. 9. Cook, note 7 above.

10. Ibid.

11. B. S . Nakashima and W. C. Leggett. “The role of fishes in the regulation of phosphorus availability in lakes,’’ Can. J. Fisheries & Aquatic Sci. 37 (1980): 1540-1549; J. F. Kitchell. et al., “Consumer regulation of nutrient cycling,” Bioscience 29 (1979): 28-34.

CHANGING RURAL LANDSCAPE

(continued from page 30)

Luis Obispo represent, among other things, the many rural areas experiencing substantial population growth from an influx of new people.

not only has there been considerable rural population growth and economic change, but that there have been changes in the land market that may anticipate and perhaps preordain future land-use change.

The results of the study indicate that

Loudoun County In the still rural western half of

b u d o u n County, Virginia, on the edge of the Washington, D.C., metropolis, formerly agricultural land is in great demand for large-lot residential parcels and for “hobby farms.” Fertile cropland areas have provided excellent soil con- ditions for septic systems and have sprouted suburban-style houses on 10- acre lots. Beyond the homesite and per- haps a garden, the rest of the parcel is rarely used by the new owner. Between 1954 and 1976, the mean size of a rural parcel in Loudoun County dropped by more than a third, from 47 to 3 1 acres. The drop appears to have resulted from a decrease in parcels of greater than 50 acres, and a substantial increase in those 1040-25 acres in size.

Accompanying the urban demand and the parcellation have been extremely h g h rates of land price increase, to the point that, at present, land prices throughout the county are far higher than can be justified by the land’s pro-

30

ductive capability. Local officials have shown increasing concern about con- trolling rural growth, but have not yet found a formula likely to preserve com- mercial agriculture in the face of a strong residential demand for land.

Tyler County

Tyler County, Texas, lies in the heart of the East Texas “pineywoods,” one of the most productive areas in the country for growing softwood timber. It is to just such areas that the lumber and paper industries must look to off- set the declining stock of oldgrowth timber in the Pacific Northwest. But the timber industry must compete for land with a host of new land buyers, who find that the peace (and low cost) of country living can offset a long commute to the refineries in Beaumont or the relatively low wages offered by a scattering of new rural industries. Recreation seekers and retirees also have found the pineywoods of interest; subdivisions of lakeside lots have been created to accommodate their homes and trailers.

of Tyler County landowners with hold- ings of less than 5 acres increased from 868 to 6,962. Some land has been taken off the private market by the federal government, which has purchased more than 10,000 acres in the county as part of the creation of the Big Thicket National Preserve.

For the present, the Tyler County landscape continues to consist mainly of a sea of industry-owned pine trees. But forces are in motion in this once- sleepy rural region that make new uses increasingly strong competitors for land.

Between 1954 and 1976, the number

Hardy County In Hardy County, West Virginia, poor

transportation networks and lack of employment opportunity meant decades of population decline. But starting in the late 1960s, abundant opportunities for hunting, fishing, and hiking started to attract the attention of urban recrea- tionists. Land prices were extremely !ow because of lack of local demand, and many urbanites found they could afford more land than they ever thought possible.

As new demand forced land prices up, investment interest quickened. Local

and out-of-town developers alike were eager to accommodate the new money, creating medium-sized parcels and specu- lative lots out of abandoned farms and woodlands. New owners are frequently interested in environmental amenities, but they appear to be doing little to upgrade the area’s forest resource, badly degraded by decades of exploitative “high-grading,’’ which left only crooked trees and unsalable species. Although urban buyers have been of some help to the local economy, they have also cre- ated animosity, for example, by posting land against hunting that was formerly open to the local community.

Douglas County The flat, phenomenally fertile land

of Douglas County, Unois, is typical of the Corn Belt, one of the world’s most productive agricultural areas. Although there is very little urbanization pressure, and no recreational demand, Douglas County farmland sells for between $3,000 and $4,000 per acre. And unlike our other study sites, the strongest bidders in the land market in recent years have been expanding local farmers, eager to borrow on the appreciated value of their holdings to finance new purchases.

As a result of this farm expansion, the number of farms has fallen over the years, and average farm size has crept upward. Coupled with a very rapid in- crease in land values, this has resulted in an enormous rise in the value of the average farm. In 1978, the average value of land and buildings on a Douglas Coun- ty farm was more than $700,000. Young farmers have difficulty competing in such a land market-it is often said ruefully that “the only way for a young person to get a farm is to inherit it or marry it.”

Plain field, Ale w Hampshire The township of Plainfield, New

Hampshire, lies in the scenic valley of the upper Connecticut River. The town participated in the century-long decline of New England agriculture, and over the years its landscape changed from being predominantly cleared fields to one that is mostly forested. There are now few full-time farmers left.

But growth is picking up, as persons working in factories and professions in small New England cities recognize the

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township as an attractive area for low- density rural settlement. In 1977 Plain- field again equaled the all-time popula- tion peak it had first reached-in 1860.

Ironically, the population revival comes at a time when New England agriculture is experiencing a modest recovery of its own. Plainfield residents must decide how to preserve the town’s rural look and its agricultural potential in a situation in which the vast majority of landowners no longer have a direct tie to the soil.

San Luis Obispo County

San Luis Obispo County, California, is located in the center of the so-called “San-San Gap,” the last long stretch of unurbanized coastline between San Diego and San Francisco. Its dry graz- ing land has long been dominated by cattle ranches that are large enough to compensate for low productivity per acre.

reminiscent of Southern California ear- lier in this century, is in great demand by retirees, hobby farmers, and other refugees from crowded metropolitan centers. Land prices have soared and ranchers are paper millionaires. Some have already subdivided-between 1969 and 1977 the number of holdings of less than 5 acres rose 55 percent while those greater than 100 acres fell 22 per- cent. And the county must also contend with thousands of tiny unserviced rural lots, subdivided decades before, and only now in demand by new settlers.

Local officials have implemented some of the strictest rural zoning in the country, but find it difficult to hold the line in the face of the large disparity between the land’s commercial agricul- tural value and its value as rural home- sites.

But now the county’s open landscape,

Po I icies Most of the trends and forces we

have identified as widespread in the rural land market are mainly developing slowly. Rural settlement has not threat- ened our current food production, nor has small parcel size caused a timber famine. But these trends, if long con- tinued, could not only threaten our future supplies of food and timber but

Environment, Vol. 23, No. 10

drastically change the characteristic look of the rural landscape. If large quantities of potentially productive rural land are devoted to urban, residential, or recrea- tional uses, if parcel sizes are too small for efficient management, or if land and timber are neglected or abused by their owners, it may take literally decades to cope with the results.

tral cities may be appropriate. Forces that began to be noticed by economists, sociologists, and planners as early as the 1930s-migration to the big cities by the rural poor and the movement of the af- fluent to the suburbs-eventually pro- duced a fiscal crisis for cities in the 1970s. Would we not have been better prepared had we begun to understand and moni- tor what was happening to our central cities at a time when the process of decline was just beginning?

In dealing with rural land, an overrid- ing social goal must be to conserve the land’s ability to fulfill its traditional pro- duc tive, environmental, and aesthetic functions.20 Given market pressures, however, approaches to this goal must begin by understanding the desires and

An analogy to the long decline of cen-

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aspirations of rural landowners and try- ing to turn their private energies in more constructive directions.

To this end, we must create new models of rural physical development and new institutions for owning and m a n a p g rural land. We must put to- gether a new body of knowledge about rural planning, borrowing from urban planning, but also incorporating insights from agricultural economics, geography, forestry, regional science, and rural sociology.21 We must recognize the diversity of rural places, and the diversi- ty of interests within them. And we must recognize that both government and the private owners themselves must participate in solutions.

Limiting Parcellation One set of policies should be directed

at limiting parcellation. Despite the con- siderable parcellation that has already occurred, 83 percent of the private land in the United States continues to be held in units of 100 acres or more-gen- erally units large enough to continue the efficient production of food or fiber. Parcellation can be limited partly by

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making it more difficult to divide land, partly by making it unnecessary.

.From the regulatory side, local governments in rural areas should set minimum lot sizes that are related to the economically efficient size of an agricultural parcel. Rather than encour- aging the carving up of large areas into 5- or 10-acre house lots, regulations should be directed toward clustering new development on less productive land, with the better lands permanectly reserved, in relatively large tracts, for agricultural or forestry use. This can be done through cluster zoning, through transfers of development rights (TDR),22 or through encouragement of “mixed use” (residential/farming, recreational/ forestry) developments.

Public policies should encourage the revival of rural towns and villages as an alternative to settlement in the open countryside. As a starting point, they should discourage the commercial strips and edge-of-town shopping center devel- opments that have eroded the natural advantages of country towns as living environments.

From the demand side, new forms ’

of landholding should be developed, so that the ownership or use of land can be shared among a number of people with- out physically dividing the land. These forms can include arrangements by which groups of people buy land in common for forestry and recreational use, as well as open-ended “community” land trusts.*j

More attention should also be paid to inducing landowners to permit public uses on private land, so that contiguous tracts of land can be open for hunting, fishing, or other forms of recreation, even while remaining privately owned.

For land that has already been sub- divided, methods of common manage- ment should be devised. This is particu- larly true for the tens of millions of acres of fragmented nonindustrial timberlands, which could be managed through timber cooperatives or through industry- sponsored landowner assistance pro- grams. In a few cases, especially in very scenic areas, government agencies may have to intervene to reassemble previously fragmented recreational lots.

Encouraging Productivity Another goal of policy should be im-

proving rural land management, regard- less of parcel size. This certainly does not mean that every acre of rural land must be intensely cultivated. But it does contrast sharply with the near-total lack of management of so much of the rural land owned by people whose major aim is price appreciation or recreational use. Educational programs should be aimed specifically at these owners to try to convince them that simple neglect is not synonymous with resource conservation. A high priority should be given to per- suading absentee owners of cropland to pay more attention to the maintenance of soil fertility and the control of

erosion. Another priority should be to develop and promote methods of non- industrial forest management that emphasize environmental and amenity values, while allowing the production of a certain amount of salable wood.

Tax policies affecting rural land should encourage productive use24 and should provide subsidies for landown- ers only in exchange for significant public benefits. Federal tax subsidies that encourage the unproductive hold- ing of rural land primarily for price appreciation should be eliminated and the subsidies redirected to promote more active owner efforts in forest management and erosion contr01.~’ Preferential assessment of farm and forest land under state or local pro- grams should be more closely tied to good land management or to the pro- vision of direct public benefit (for example, if land is open for public access). However, at the same time, bet- ter rural assessment practices should ensure that owners whose development opportunities are restricted by land- use controls pay taxes ohly on the basis of permitted uses.

The problem of access to land for young farmers is a difficult one. Direct subsidies, such as below-market loans for land buying, are extremely expensive and are likely to benefit only a small number of people. We would prefer to see the problem addressed in more indirect ways. First, existing federal

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farm progr,ams should be reoriented so that they no longer have the effect of favoring ever-larger scales of operation. Second, we would ldce to see-a general loosening of rural land supply through modification of those economic incen- tives that encourage long-time owners to retain land as an inflation hedge, even though they are not maximizing income from it. The general policy approach should again be to make the pursuit of income from farming, rather than of capital appreciation, the most lucrative activity within the agricultural sector.

Collecting Data A final policy recommendation per-

tains to the information base on which policymakers rely in making their de- cisions. Until only two years ago, it could be truly said that “no one knows who owns rural America.” Recent sur- veys by the U.S. Department of Agri- culture have greatly increased our knowl- edge of ownership patterns. But peri- odic monitoring of ownership changes over time is essential if market trends are to be accurately charted. Owner- ship data must also be more closely integrated with existing data on land uses, so that hypotheses can be gener- ated and tested about the relation of landownership to land management. And the collection of current land price data must be broadened to include prices of recreational and forest land as well as farm land.

In the last decade, unprecedented changes have come to rural areas all over America. Understanding the changing land market, whch often anticipates and even preordains more visible changes in the land itself, is essential to under- standing and coping with current and future growth. ROBERT G. HEALY is an economist and sen- ior associate at The Conservation Foundation who has written extensively on land-use issues and policies. He is currently on the faculty of the College of Architecture and Urban Plan- ning at the University o f California, Los Angeles. He previously served on the research staffs of the Urban Institute and Resources for the Future and has taught regional plan- ning at Harvard University.

JAMES L. SHORT is a professor of real estate and land studies at San Diego State University, He has conducted studies o f housing policy, agricultural land preservation, and the economics o f new town develop- ment. Before joining the university, he was on the research staff of the Federal Home Loan Bank Board, Washington, D.C.

Environment, Vol. 23, NO. 10

1. These studies were undertaken under the auspices of the Conservation Foundation and were funded by the Richard King Mellon Foundation. For a much more extensive pre- sentation of the findings of this study, and of the research and documentation on which they are based, see Robert G . Healy and James L. Short, The Market for Rural Land. The Conservation Foundation, Washington, D.C., 1981.

2. See US. Department of Agriculture, Farm Real Estate Market Development, various issues. In using this series, we follow the usual convention of using prices of “farm real estate” as synonomous with land prices. In fact, the value of structures has dropped over time, from 29 percent of total real-estate value in 1950 to 17 percent in 1980. Thus, the figure presented here understates the rise in the value of bare land, which has, on a per-acre basis, risen nearly 1100 percent over the period 1950-80. We have chosen not to separate land and structure value both because of data limi- tations and because the two are physically inseparable.

3. As with most aspects of rural land sales, we simply do not have national statistics describing trends in the demand for land or in patterns of ownership. However, the US. Department of Agriculture’s (USDA’s) first nationwide landownership survey. taken in 1978. does give us a picture of ownership patterns at a single moment in time. Accord- ing to USDA’s national survey. more land is owned by farmers than by any other group in the United States. The total amounts to a half billion acres. or 38 Percent of all Pri- vately held acreage. This is certainly not surprising, given the Large amount of US. land that is devoted to agriculture. Neverthe- less, it is interesting to note the study’s find- ing that 44 percent of farmland and ranch- land is owned by nonfarmers. Next in importance among landowners are retirees, who hoId 190 million acres, or 14 percent of all private land. Many in this group are probably retired farmers who either have leased their fields to tenants and continue

to live on the fannstead or who have moved off the farm entirely to spend their later years elsewhere. The remainder of U.S. land is owned by white-collar workers (12 per- cent); nonfamily corporations (11 percent); blue-collar and service workers (7 percent); family corporations (5 percent); housewives (3 percent); and “others,” including estates (7 percent). James A. Lewis, Landownership in the United States, USDA Economics, Statistics and Cooperatives Service, Agricul- ture Information Bulletin No. 435. Govern- ment Printing Office, Washington, D.C., 1980.

4. Between 1950 and 1979, the average size of a U.S. farm more than doubled, reaching 450 acres per fann. Even as small fanners were leaving the countryside, their neighbors were buying land to expand operations.

5. Newly available data from the 1978 USDA national landownership survey indi- cate that 94 percent of cropland is held in units of 50 acres or more, and that more than 90 percent of rangeland is in units of 160 acres or more.

6. Webster’s Third New International Dictionary defines parcellation as “division into parcels.” The term sometimes also appears in the planning literature as “parcel- ization.”

7. The 1978 USDA landownership survey found that 28 percent of currently owned land had been acquired in the period 1960- 78; 26 percent in 1960-69. Regionally, in recent yeam the highest land turnover has been in the Midwest, the lowest in the Deep South.

8. Quoted in Jourdan Houston, “How’re You Gonna Keep ’Em Down in New York After They’ve Seen hesque Isle.” Country Journal. April 1977.

9. Outmigration from nonmetropolitan counties has fallen about 12 percent since the late 1960s. James J. Zuiches and David L. Brown. “Changing Character of the Non- metropolitan Population, 1950-75.” in Thomas R. Ford, ed.. Rural USA: Persistence and Change. Iowa State University Press, h e s , 1978, p. 65. An excellent recent over- view of nonmetropolitan population-growth

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data and a review of demographers’ think- ing on the matter may be found in Larry H. Long and Diana DeAre, Migration to Non- metropolitan Areas: Appraising the Trend and Reasons for Moving, U S . Census Bureau, Special Demographic Analyses CDS 8-2, Government F’rinting Office, Washington, D.C.. November 1980. The authors observe that nonmetropolitan growth has not slowed since the 1974 energy crisis and that “non- metropolitan areas in the aggregate are likely to continue, for a while anyway, to have higher rates of population growth than metro- politan areas.”

10. Richard Lamb, “Intra-regional Growth in Non-Metropolitan America: Change in the Pattern of Change” (Paper presented to the annual meeting of the Association of Ameri- can Geographers. April 1977). See also, Kevin F. McCarthy and Peter A. Momison. The Changing Demographic and Economic Structure of Nonmetropolitan Areas in the 1970s. Rand Paper P-6062. Rand Corporation. Santa Monica, January 1979. Both studies showed higher growth rates in nonmetro- politan counties specializing in retirement and recreation.

11. Data are from the 1977 Soil Conservation

advantage to the speculator. The Depart- ment of Agriculture estimates that 24 million acres of land that could be used as cropland are being held for possible urban use. Such land is “very near other land already in urban use and known to be held by a person or corporation for development.” U S . Depart- ment of Agriculture, Soil Conservation Ser- vice, Potential Cropland Study, Statistical Bulletin 578, Government Printing Office, Washington, 1977.

16. Lewis, note 3 above.

17. A t present about one-third of all farm- land, approximately 300 million acres, is rented rather than owned by its operators. There is no exact measure of the percentage of farmland operated by someone other than its owner. One estimate, based on data from the 1974 Census of Agriculture, is that 32 percent of acreage in farms is rented from nonfarmers. plus another 5 to 7 percent rented from other farm operators. Bruce Hottel and David H. Hamngton, “Tenure and Equity Influences on the Incomes of Farmers,” in U.S. Department of Agriculture. Structure Issues of American Agriculture, Government Printing Office, 1979, Washing- ton, D.C.. p. 97. The 1978 USDA land-

suitable. In theory, owners of land in the receiving area would buy development rights from other landowners and transfer them to their own property, thus leading to clustering of development. However, a national survey found that by 1980 only ten municipalities and two counties had adopted TDR for the preservation of farmland and other open space. Only five TDR transactions, involving 184 acres, had taken place. See Coughlin. Keene, et al., note 20 above, pp. 174-79. One of the nation’s most ambitious agricultural TDR programs was adopted by Montgomery County, Maryland, in 1980. See Plowing New Ground: Questions and Answers, Mont- gomery County. Maryland, Agricultural and Rural Open Space Preservation Program, Mont- gomery County Planning Board, Silver Spring, Maryland, 1981.

23. A community land trust is an institution by which land is perpetually owned by a non- profit group, but rented to individuals for farming or homesteads under long-term lease. See John Blackmore, “Community Land Trusts Offer a Hopeful Way Back to Land,” Smith- sonian (June 1978). Community land trusts frequently are set up in the legal form o! a nonprofit membership corporation, rather **.. . 9.

Service National Resources Inventory. ownership survey reported 252 million acres man as a zrusc‘

12. Twelve percent of forest land is in owner- ships of less than 50 acres. Small tract size raises the cost of harvesting timber; even more serious is parcellation’s impact on the use of productivity-raising management methods. For example, a recent study of forestland in Oklahoma demonstrated that parcel size had a measurable influence on the intensity of forest management. As might be expected. the researchers found that the larger the tract size the greater the likelihood that the owner would be interested in wood production; the

of farmland (27 percent of the total) were rented from a nonoperator landlord. Robert Otte, “Farm and Ranchland Ownership in the US., 1978,” unpublished, US. Depart- ment of Agriculture. Washington, D.C., 1981.

18. There is evident concern in many parts of the country about the passing of traditional rural landscapes. See the dozens of papers on the subject in Our National Landscape (Pro- ceedings of a Conference on Applied Tech- niques for Analysis and Management of the Visual Resource. April 23-25, 1979, Incline

24. Ideal tax regulations would allow owners of working farms and forestlands to defer any property-tax payment that amounted to more than. say, 5 percent of their annual net income. This deferred tax liability would be- come a permanent lien on the land, payable with interest when the land was sold. The policy would allow traditional farmers to con- tinue working their land, even if its rising price made potential property taxes very high. And it would make owners of idle property (who would not qualify for the tax deferral) pay a

- . greater Snare of rural taxes.

25. These subsidies include the low rate at which capital gains are taxed (now reduced even further under the new 1981 tax law-

higher was the intensity of management; and the greater was the probability of harvest. Richard P. Thompson and J. Greg Jones, “Classifying Nonindustrial Private Forestland

Village. Nevada), General Technical Report PSW-35. U S . Forest Service, Pacific South- west Forest and Range Experiment Station, Berkeley, Calif.. 1979.

by Tract Size,’’ Journal of Forestry 79 (May

13. See Leon Minkler, Woodland Ecology, Syracuse University Press, Syracuse. N.Y.. 1975. 14. Ironically. well-intended local and state

uted to parcellation by causing lots used for

19. J. Peter DeBraal and T. Alexander Maichrowicz, Foreign Ownership of US. Agricultural Land, February 1,1979- December 31,1980. Agriculture Informa- tion Bulletin #448. Economics and Sta-

culture, Washington, D.C.. 1981.

from a maximum of 28 to 20 percent). The low capital gains tax encourages speculators to buy and retain land even though it is not fully (or at all) utilized for productive purposes.

1981): 288-291.

land-use regulations have sometimes contrib- Service, u*s’ Department Of

FRENCH ECOLOGISTS development to be larger than they would otherwise have been. For example, many counties have zoned their rural portions so that building lots must be at least 5 or 10 acres. This requirement may inadvertently increase the total amount of land in medium- sized parcels, which are unnecessarily large for residential purposes, yet far too small for most agricultural uses. Similarly, Vermont’s state land-use law (Act 250) exempts parcels of more than 10 acres from certain regulations. It is said that subdividers have chosen to avoid the costs of compliance with the law by creat- ing lots just slightly larger than the 10-acre limit

15. Richard F. Muth suggests that the capital gains provisions of federal income- tax laws have increased the amount of land affected by speculation. He argues that “the fact that the return from holding land for future use is taxed as a capital gain en- courages more land to be held for future

20. An up-to-date bibliography of the litera- ture on methods for identifying and preserv- ing productive agricultural land is National Agricultural Lands Study, Agricultural Land Retention and Availability: A Bibliographic Source Book, Government Printing Office, Washington, D.C.. 1981. For a summary of state and local policies toward agricultural land, see Robert E. Coughlin, John C. Keene. et al., The Protection of Farmland: A Refer- ence Guidebook for State and Local Govern- ments Government Printing Office, Washing- ton, D.C., 1981.

21. For recent examples of thinking on rural planning, see Vernon P. Deines and Ann D. Watts, “A New Mood for Rural and Small Town Planning,” PAS Memo no. 80-5, American Planning Association, Chicago. June 1980; and Lee Nellis. “Planning with Rural Values,” Journal of Soil and Water Con- servation 35 (March-April 1980): 69.

(continued from page 20)

25. Ibid., p. 148. The first reactor at Fessen- heim was scheduled to begin operating a few weeks after the municipal election, and a second was within a year of completion. Con- sequently, the election of an anti-nuclear list to the city council was symbolically im- portant but of little practical significance.

26. Ibid., P. 148.

27. Ibid., P. 119. Statement by Jean-Claude Delarue. “La grande famille des dcologistes,” March 20. 1977.

28. Le Nouvel Observateur. “L’dlectorat ‘vert.’ ” February 7, 1977, p. 24. The results of a SOFRES poll, reprinted in the article, show that 59 percent of ecologist voters. just prior to the municipal elections, identi- fied themselves as “left” or “extreme left,” where= only 27 percent described themselves

conve-kon than would otherwise be the 22. Under a TDR zoning ordinance, each land- as “center,” “right,” or “extreme right.” case.” Richard F. Muth. “Urban Residential Land and Housing Markets.” in Harvey S . Perloff and Lowdon Wingo. Jr., eds., Issues in Urban Economics, Johns Hopkins Uni- versity Press for Resources for the Future. Baltimore. 1968. P. 315. Since that state-

owner in a defined region is assigned a certain number of development rights (for example. each receives the right to build one house for every 20 acres he owns). See John J. Costonis. Space Adrift, University of Illinois Press, Urbana, 1974. These rights can only be exer-

29. Vadrot, note 13 above, p. 154. Addition- ally, the Parti Socialiste Unifid’s ideology is outlined in Pour vivre, produire et havailler autrement: Programme autogestionnaire present6 par le PSU, Paris: Editions Syros, .I ,.-0 I Y 1 0 . ment was made, capital-gains tax rates have

been further reduced, increasing the tax cised in a defined “development receiving area” where clustered development would be 30. In 1972, the Programme Commun,

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