New federal rules designed to protect the pygmy owl could stall growth near urban areas in Arizona, critics say.
At issue are 435,000 acres of state trust lands, which are included in the U.S. Fish & Wildlife Service's new regulations to preserve desert habitat for the pygmy owl.
The new rules say 731,000 acres of federal, state and private land are critical for the survival of the owl.
Of that total, nearly 435,000 acres are state trust lands, which the state sells or trades to residential or commercial developers. Proceeds go to school districts.
The rules will hurt the value of the state trust land by restricting its use, said Mike Anable, state land commissioner.
"It's a cloud on the property that affects its value and affects its utility," Anable said.
Anable and other state officials, along with Arizona homebuilders and their attorneys, are expected to review the new federal rules to decide whether to challenge them in court.
If the state trust lands are protected for owl habitat, the state could be prevented from selling the land to help support schools, said Kirk Hays, an attorney with Phoenix law firm Gallagher & Kennedy, P.A.
Opposing the new rules are Arizona's homebuilders, who say protecting suspected owl habitat could slow or stop future growth in central and southern Arizona, Hays said.
Once the new federal rules are reviewed, the builders will consider a lawsuit to stop their enforcement.
"If there ever was one (issue) that could be challenged, it's this one," Hays said.
Hays' law firm represents several Arizona homebuilders who often bid when state trust lands are up for sale.
Another challenge will be considered by the state because of the impact of the rule on the sale of trust lands, said Scott Celley, executive assistant to Gov. Jane Hull.
"The governor has not ruled anything out in dealing with this because we think the impact of it has long-range consequences, Celley said.
The new rules require developers to complete three owl studies each summer, for two years, before developing their desert properties, Hays said.
A surveyor, after playing tape-recorded sounds of pygmy owls, listens for responses. If the surveyor fails to find evidence of the owls, the builder can develop the property.
But if evidence of an owl is found, the builder meets with Fish & Wildlife Service officials to determine whether to protect that property, swap it for other land, or reduce the density of the proposed development.
The new federal rules are the result of a lawsuit filed in October 1997 against the Secretary of the Interior by the Southwest Center for Biological Diversity, a conservation organization in southern Arizona. The complaint alleged the federal agency failed to designate critical habitat for the owl.
In Pima County, a report released earlier this year by Phoenix economist Elliott Pollack estimates that over 15 years, protecting owl habitat in the Tucson area will cost the region $8.5 billion in lost jobs, less taxes, less wages, lower property values and higher housing costs.
A similar study was not performed in Maricopa County because a review of 50 biological surveys in Maricopa and northern Pinal counties showed that pygmy owls have not been seen or heard in the region for nearly 30 years, said Connie Wilhelm-Garcia, executive director of the Home Builders Association of Central Arizona.
"We don't think there's any basis to designate Maricopa and northern Pinal counties as critical habitat for pygmy owls," Wilhelm-Garcia said.
Builders in Pima County are feeling the impact of the new regulations. In 1998, concern about owl habitat stopped construction of a new high school in northwest Tucson.
Earlier this year, officials in the community of Marana north of Tucson were cautioned by U.S. Fish & Wildlife Service officials about approving new zoning for development of land said to be owl habitat.
The 7-inch cactus ferruginous pygmy owl was added to the federal Endangered Species Act in 1997.
Until 1998, Pima County was the study area. But because of concern the owl's habitat was being threatened by urban growth in other areas, Fish & Wildlife added areas in eight other counties.
In Maricopa County, most of the region's undeveloped areas fall into this category: north of Bell Road, east of Pima Road, south of Southern Avenue and west of the proposed Loop 303.
Reprinted with permission of The Business Journal.