Reuters

Far from 'frivolous spending,' data shows trails can actually boost property tax revenues

With budget crises a reality for local governments all over the country, recreation amenities like bike trails are often the first places to look for cuts. But according to research coming out of the University of Cincinnati, proximity to trails in urban areas increases property values, which in turn boosts the amount of property taxes filling government coffers.

The research, by planning professor Rainer vom Hofe and economics professor Olivier Parent, looked at houses along a 12-mile stretch of the Little Miami Scenic Trail, a former rail line that cuts across the northeastern portion of Cincinnati. The pair found that home buyers were willing to pay a premium of $9,000 to be within 1,000 feet of access to the trail.

"A bike trail like this has many types of returns. Residents can use it as a way to commute, and most people use it for recreation," says vom Hofe. "For local governments, you can make a strong argument that they get back some of the money invested in these public amenities in the form of higher property taxes. We see positive spillover in more densely populated urban areas as well as less densely populated, suburban areas." The study looked at 1,762 houses, worth an average of $263,517, that were located within 10,000 feet of the trail.

Although there’s no comprehensive way to track local spending on bike trails, there have been several proposals this year to cut federal funding for bike paths. Congressman John Mica of Florida called for eliminating the Transportation Enhancements and Recreational Trails programs, which fund many bike trails. Sen. Rand Paul of Kentucky wants to divert funds for the Transportation Enhancements program to bridge repair, while Sen. James Inhofe has said one of his top three priorities is to eliminate “frivolous spending for bike trails.” 

The bike-trail research backs up previous studies that have found links between bike paths and increased real-estate values. As vom Hofe was conducting his study, he was also on the hunt for a new house, which gave him insight into the amenities people look for when choosing where to live. And while he concedes that access to recreation isn’t as important as, say, a school district for many home buyers, he points out that trails are especially attractive in cities that are far from oceans, mountains and other natural attractions.

“Many cities don’t have the great outdoors next door,” he says. “They have to look at what they do have, and things like parks and trails and green space are all assets that people are willing to pay more to be located near.”

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