COOPERSTOWN -- Lease or no lease?
In a region where hundreds of parcels have been leased to energy companies, more and more prospective home buyers are asking whether the real estate they are eyeing is under lease to a gas drilling company, according to several local real estate agents.
"It is impacting us to the point that we have actually lost sales because of it," said Dave LaDuke, a broker with John Mitchell Real Estate in Cooperstown.
Savvy buyers are not only asking about the status of the properties they'd like to view but also whether any other tracts of nearby land are under lease with gas companies, real estate agents said.
Unless they are possibly speculating they could profit by leasing the land themselves to a gas company, they often walk away from the property when they hear the land it sits on is under lease, real estate agents said.
"This is affecting the marketing of houses drastically, and it's affecting our sales," said Ron Johnson, an associate broker with Hubbell's Real Estate in Cooperstown. "People in general are very skeptical about buying land next to leases or houses next to leases. If they go through with the purchase, the buyers know they are going to have to live with it for a long time."
Would-be sellers whose homes are leased or next to leased lands are finding that buyers are concerned about potential pollution in wells, and concerned they may have difficulty obtaining a mortgage or homeowner's insurance.
"The banks are reluctant to take on these mortgages," Cedar Ridge Realty sales agent Kelly Branigan said. That makes it more difficult for the seller to find a buyer, she said.
Real estate agents said they are required by their code of ethics to disclose any material fact about a condition that could impact the value of a property. In anticipation that buyers will want to know up front about whether a property is leased or not, some real estate ads are beginning to include mention of if the property is under such an agreement.
Eric Lein, a sales agent with Realty USA in Oneonta, said he is surprised when he encounters buyers who have no interest in knowing whether gas drilling could be permitted in an area where they are looking for a house.
"This is something that isn't discussed enough," Lein said. "I know if I was looking for a piece of property and somebody in my area was going to have fracking on his property, I wouldn't buy in that area."
In Otsego County, a total of 1,148 parcels of land are under lease with gas companies, according to the Otsego County Conservation Association, which compiled the information from records kept by the Otsego County Clerk's office. A map showing the location of those parcels is posted on the group's web site: www.occainfo.org.
Homeowners who sign away the drilling rights to their land to natural gas companies are taking a major risk with their mortgage because mortgage agreements prohibit heavy industrial activity and hazardous materials on the property, said Elisabeth Radow, a real estate lawyer from Westchester County and an expert on gas leases.
"The notion of setting up a heavy industrial enterprise on your property is something your lender is going to want to know about," Radow said.
Also put into jeopardy by a drilling lease is the owner's homeowner's insurance policy.
"There is the potential that homeowner's insurance carriers will decline to insure homeowners who have gas leases because they don't want to be pulled into litigation and pay the litigation expenses," she noted.
And even though the state Department of Environmental Conservation is continuing to review draft rules that would allow hydrofracking to go forward, she said real estate shoppers should be especially cautious when looking in an area where there are leases.
"People have to assume that these operations are going to be going on wherever they see that a lease exists," she said.
Still another reason for caution for buyers who have no desire to lease their land to gas companies is New York's compulsory integration law, which can force neighbors into a drilling pool even when they have refused to sign a lease, Radow said.
Homeowners who have signed leases and think they can get out of them simply by waiting for the expiration date are often in for a rude awakening thanks to automatic renewal clauses that work to the advantage of the drilling companies, said Syracuse-based environmental lawyer Joseph Heath.
Heath, who has conducted lease termination workshops for homeowners seeking to get out of the agreements they signed with gas companies, said some leases allow the companies to extend the agreement simply by commencing "operations."
In one case in Pennsylvania, he said a company extended a lease simply by parking a bulldozer on a property before the agreement expired.
"It's an incredibly broad definition of what are 'operations,'" Heath said.
COOPERSTOWN -- Lease or no lease?
- Local News
EPA deems pipeline study 'insufficient'
The U.S. Environmental Protection Agency has concluded that a draft report on the environmental impacts of the proposed Constitution Pipeline is "insufficient," and that a potential option of co-locating the transmission line along Interstate 88 "has not been fully evaluated."
State OKs $28M grant for Sidney to fight floods
â€œItâ€™s a very exciting time for us,â€� Sidney Mayor Andrew Matviak said about receiving state approval for more than $28 million for flood mitigation projects. The funding still requires federal authorization, but local officials expected that would be forthcoming.
Local students earn Girl Scouts' highest honors
Two local young women have earned the highest award in Girl Scouting after spending more than 80 hours working on projects to impact their communities.
SUNY Delhi dinner to offer a taste of Portugal
More than 100 students in SUNY Delhi's hospitality management program will join forces on Thursday to present a gourmet four-course dinner, organizers said Monday.
Hartwick student honored for economic analysis
The topic on which a Hartwick College student wrote an award-winning essay was the inspiration for her to return to school after 35 years, she said Wednesday.
Police: Sex offender removed GPS device
A sex offender from Delaware County was arrested Wednesday after he allegedly removed a monitoring device from his body and hid in a Hamden residence.
Mayor laments recurring vandalism of city trees
Two young trees planted near the intersection of Market and Lower Main Street recently were vandalized, the mayor said Wednesday.
Bassett : No date yet for psychiatric unit's closure
No date has been announced for the closure of the inpatient psychiatric unit at Bassett Medical Center in Cooperstown. Bassett is completing necessary paperwork and awaiting a response from the state Office of Mental Health, Bassett spokeswoman Karen Huxtable said Wednesday.
Airport panel to meet today
The city's Airport Commission will meet at Oneonta City Hall, 258 Main St., at 4 p.m. today.
- Wednesday, April 16, 2014
Local forum to focus on heroin epidemic
The growing local, state and national problem of heroin use will be the focus of an upcoming forum in Oneonta
Walton woman reprints 'jewel' of local history
A "precious jewel" of local history has been polished up to a new shine by an area author.
Common Council puts manager search into motion
The Oneonta Common Council passed motions initiating a search for a city manager and a review of the City Charter, among other business during a meeting in City Hall on Tuesday night. Also, the mayor and some council members raised concerns about the impact of the pending closure of the inpatient psychiatric unit at Bassett Medical Center, quizzing the police and fire chiefs who were present to give monthly department reports.
Most back casino plan at Schoharie forum
RICHMONDVILLE -- The Schoharie County Board of Supervisors heard strong public sentiment Tuesday night in favor of bringing a Las Vegas-style casino to the county, though some residents gave the proposal a chilly reception.
Speedway foes score new legal victory
The controversial New York Safety Track in Harpersfield will face significant limitations on attendance and engine sizes when it opens this year after the facility lost the latest round of a legal battle initiated by neighboring home owners.
Officials warn of possible flooding
Flood watches were set Tuesday for Otsego, Delaware and Chenango counties, but officials said they had no reports of flooding or related problems by 4:30 p.m.
- Tuesday, April 15, 2014
SAFE Act registration deadline arrives
One of the most controversial components of the New York SAFE Act -- mandatory registration of assault weapons -- kicks in today. Those who fail to comply could end up facing criminal charges.
OWL, college team up to teach kids science
More than 70 little ones gathered at SUNY Oneonta's Science Discovery Center on Saturday to learn about a world far littler than their own.
Council to discuss city manager search
The search for the city's second city manager, a review of the charter and a penalty for unregistered vacant properties will be among topics addressed at the Common Council meeting tonight.
Deadline nears for school board race
Petitions for one of three open seats on the Oneonta City School District Board of Education are due by 4 p.m. April 30, District Clerk Eileen Lishansky said.
Local Jews grieve for victims of Kansas shooting
Members of the Oneonta Jewish community said that they did not feel the shootings in Kansas were of particular concern to this area.
- EPA deems pipeline study 'insufficient'