EXIDE’S IMPACT ON FRISCO’S ECONOMIC UNDERDEVELOPMENT:
A BRIEF ANALYSIS
Prepared by Bill Luker Jr, PhD, Economics, University of Texas-Austin, 1992, LBJ School of Public Affairs at
the University of Texas-Austin, Texas A&M University, the University of Wisconsin-Madison, Verizon, the
University of North Texas Departments of Economics and Geography, Lockheed Martin, and the MITRE
Corporation, Washington DC. Founder and Director of economic and statistical research consultancy,
www.terranovumSolutions.net. Reachable toll-free at (855) 445-0834, or by email at
drbilllukerjr@teranovumSolutions.com. Curriculum Vita, client list, publications, and references available
upon request.
This is a summary analysis of impacts on property values of a sample of 90 homes in
close proximity (between 3000 and 3600 feet) to the former Exide Corporation’s lead
smelting operations in what is now downtown Frisco, TX. It uses reliable estimates
drawn from the very broad and deep empirical literature1 on the statistically and
commercially significant negative economic impacts of closely similar brownfield sites on
residential property values in their immediate locale.
Re-development of the Exide site and surrounding property cannot occur if
environmental remediation is viewed by the market as neither thorough nor complete.
The net result of years or even decades of contamination will not only continue to
depress values for both residential and commercial property, but will also hold down the
growth of local private employment and levels of personal and household income. All of
these factors will contribute to the indefinite perpetuation of economic underdevelopment
in Frisco.
In the case of Exide in Frisco, for the year 2011, findings from that literature were used
to calculate the negative impact on the assessed property values of 90 homes, a 3
percent non-random, spatially bounded sample from a population of 2782 homes
identified within .5 to 1.5 miles of Exide-Frisco.2 The 90 homes are distinguished by
three characteristics.
1

They are the largest cluster of homes in the data, between 3000 and 3600 feet
from Exide-Frisco, close enough to Frisco-Exide to detect some of the larger
negative impacts on their assessed property values that stem from their
proximity.

They are suffering additional negative impacts from their proximity to the toxic
contamination of Stewart Creek, which runs east through the Exide site, and into
what is being planned as Grand Park, roughly parallel to the 90 homes, at an
average distance of about 2500 feet.
The most recent and reliable of these studies is “Waste Sites and Property Values: A Meta
Analysis,” John B. Braden, Xia Feng, and Doo Hwan Hon. Environmental Resource Economics
(2011) 50: 175-201. The authors statistically analyze a pooled sample of data and findings from
46 separate studies, and found in all cases statistically and commercially significant negative
effects on property values from the presence of a contaminated site like Frisco-Exide. None of the
studies they reviewed found zero or positive effects.
2 Data on appraised values was from the Collin County Central Appraisal District.
Frisco Economic Development

Bill Luker Jr, PhD
Because the extent of the contamination remains uncertain, we use a “worst
case scenario” in which these homeowners are also being denied a 5 percent
positive impact on their property values—an amenity premium they should be
able to capture in the form of increased equity in their homes—from their
immediate adjacency to the proposed, but contaminated, Grand Park. The
downstream contamination of Stewart Creek into and through the entire length of
Grand Park, as it flows from the Exide site to Lake Lewisville, denies them that
premium.
Results of our calculations are summarized in Table 1., sections i. through vi., below.
Table 1.
Negative Impact on 90 Home Valuations From the Frisco-Exide Brownfield Site.
(All Data and Results, in Percents and Dollars, Are for 2011. N=Number of Homes in Study=903
i.
ii.
iii.
iv.
v.
vi.
Total
Assessed
Value of
Homes
Total Negative
Impact From
Exide-Frisco
Percent Total
Negative
Impact
Average
Assessed
Value of
Homes
Average
Negative
Impact From
Exide-Frisco
Average
Percent
Negative
Impact
$16.1m
$2.4m
14.9
$189,347
$24,613
13.0
This negative impact is substantial, from both the policy-maker’s viewpoint, and the
homeowners themselves.

There are double-digit negative impacts, in percentage terms, in the total
negative impact on assessed values of all 90 homes (sec iii., Table 1), and
average negative impact per home (sec vi.), respectively, at 14.9 and 13.0
percent.

There’s an average negative discount of $24,613 (section v.) (2011 dollars).

The homes’ average assessed value was $189,300.

With an average discount of $24,613, the average home would be more properly
assessed at $213,913

In other words, if it were not in close proximity to two sources of contamination,
i.e., Exide-Frisco and a dangerously contaminated Stewart Creek, the average
home would be assessed, again, at about $213k, $24k more than its current
appraisal of $189.3k.
These are large impacts on homeowners, to which the implicit costs—the opportunity
costs—of roughly 15 percent, or $25,000, are measured in what such an amount would
have earned if it had been saved in a financial instrument during the same period. While
3
Totals and averages are across a range of 3000-3600 feet from the Exide-Frisco Site.
2
Frisco Economic Development
Bill Luker Jr, PhD
returns on interest-bearing accounts are low, the recent run-up of the market would have
produced substantial gains.
Because these homes are characterized by their position within a non-random,
geographically bounded sample, the findings should be interpreted with some caution.
However, while they might represent an overestimate of impacts in this locale, they are
almost undoubtedly an underestimation of the economic impacts on these and other
homes throughout Greater Frisco, regardless of their distance from the Exide site.

These calculations do not include commercial properties, the aggregate effects
for which would be larger.

The contamination of Stewart Creek puts the development of Grand Park into
question, further exacerbating the negative discounting of Frisco property values
from the foregone gains in appraised values that would accrue to them from
having nearby parkland for recreation activities.

These amounts would be dwarfed if we had calculated the economic impact on
Frisco and Frisco ISD from property values discounted by its overall
underdevelopment, brought on by the presence of Exide just south of the old
center of what was once downtown Frisco, and packages of land in its intended
buffer zones that themselves house landfills polluted with lead smelting residues.
There’s almost a complete absence of residential or commercial property within a 2000foot radius of the Exide site. This lack of development creates a giant donut hole in the
town, at the center of which is the Exide site and its buffer zone of land zoned
agriculturally and industrially.
The costs we’ve reported, while substantial for many homeowners, will be
unquestionably dwarfed by the magnitude of those from the discounting of
residential and commercial property values, and the negative effect on local
personal income, employment, average and median household income, and
ultimately, lost tax revenue for local government (the City of Frisco and the Frisco
ISD), from the impact on the local economy of the Exide site and Stewart Creek’s
presence at the center of the doughnut hole.
A complete economic impact study of the ongoing toxic presence of the Exide site and
Stewart Creek would focus on prospects and scenarios for continued underdevelopment
or re-development of Frisco. Such a study would quantify those negative impacts, and
the positive impacts of a thorough and complete cleanup of the Exide site and Stewart
Creek, including,

Restoring property values to levels they would have been without the negative
impact,

Stimulating private investment by making those properties available for redevelopment;
3
Frisco Economic Development

Bill Luker Jr, PhD
Representing an investment in the economic development of Frisco, which will
positively affect economic measures of local well-being, including property tax
revenues.
4