A Hedonic Analysis of Combined Sewer Overflows (CSOs) in Northern New Jersey

Significant water pollution caused by flooding due to heavy precipitation and extreme weather events such as Hurricane Sandy and similar storms of the past have become a considerable problem, and changing weather patterns and sea level rise attributable to global climate change stand to further exacerbate the issue. During heavy precipitation events, combined stormwater and untreated sewage may be diverted to adjacent water bodies, resulting in contamination and water pollution that can be harmful to human and environmental health. This contamination, especially in urbanized areas of northern New Jersey, is largely a product of discharge events from combined sewer overflows (CSOs). Though the effects of the contamination caused by polluted water discharge through CSOs has been studied by some researchers, the socio-economic aspect of these issues has not received much scientific attention. This study seeks to understand the socio-economic facets arising due to of the continued use of CSOs in Elizabeth, Newark, and Paterson by using a hedonic analysis of homes near CSOs to evaluate its detrimental effect on the price of residences in these urban areas. We use real estate and county data in a GIS overlay to map residences and features in these urban New Jersey areas and undertake geospatial analysis to reveal the effects of household, neighborhood, and environmental attributes on sale price. We use the data from GIS analysis in logistic regressions in order to analyze the significance of a number of these factors, including proximity to the nearest CSO, and estimate the economic effect that each factor has on a residence’s final price. This information is critical for revealing the socio-economic consequences of continued CSO operation, and can provide data for preventing the worst of CSO problems in the case study cities and similar urban areas. Further, these results can be used to inform CSO management strategies, including the use of green infrastructure, to understand economic impacts and intuit public perceptions of various strategies.