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Advances in Applied Interdisciplinary Research Using Environmental Observations:
Focus on Environmental Real Estate Applications

Thomas Gay

     I am going to focus my presentation on showing you where industry is going and what is occurring with the integration of information, which is going to affect each and every person in this room in the coming years as you go about doing things that today you consider to be common and ordinary in the course of your lives. There is a tremendous change taking place in the marketplace. This change is occurring for a whole host of reasons. You all know the vast sums of information that are available to you within your various pursuits, be they government or scientific organizations. Today, this information is changing forms and shapes. With the enablement of the World Wide Web, it is moving out beyond the desks of businesses or organizations such as ours and actually moving into the hands of consumers--markets of one, as I like to call them--because of available bandwidth. The access to and relevance of the information are becoming increasingly clear. I am going to show you some examples of both of these factors and how the situation is evolving.

     There is also a growing appreciation within the private sector of the value of information. I have been around the information industry since the mid-1970s and have seen it change enormously over that time. Information now is being driven down into the desktops of every worker in an organization to help them make more effective decisions. I think the great productivity leap that is causing or driving our economy to be as strong as it is comes in large part out of this availability of information at the point of need. The goal we have at VISTA Information Solutions is to take the kind of information that we work with every day in our scientific pursuits and make it something that the consumer marketplace here in North America can use.

     I want to move our discussion out of the technological into some of the practical applications to give you a sense of how you personally would look at information. If you were getting ready to buy a home--whether on the Severn River in Maryland, in the San Francisco area, or in Southern California--would you like to know before you purchased a home whether or not there was a risk of that hill sliding down a month or a year after you bought the home? The answer is invariably yes.

     Today, knowledge of this type resides in all of our hands, and it is being provided more and more in the marketplace to help people make a decision, in the course of looking at real estate or looking at property risk. Let us just assume that it doesn't matter where you are, the illustrations of the demand are extraordinary. There is an initiative under way, or at least in its early stages, through the Federal Emergency Management Agency to rebuild the entire U.S. flood-mapping inventory. Last week a proposal was described in The Washington Post regarding charging home buyers $20 to $25 as an added closing cost to underwrite the development of a new national flood data layer to allow the knowledge of flood risk or flood exposure to be disseminated efficiently and accurately to those with the greatest need. It is also reflective of a shift of the cost burden of emergency response in flood management from the public sector to the private sector. I am not here to argue the merits of this proposal. Nevertheless, it is a very timely issue, especially given the North Carolina flood experience in 1999.

     When we look at environmental data in a private-sector company, I am pleased to say we look at them in many of the same ways that you do, although we provide some unique spins to the data. We look at data from the perspective of property risk information. Who cares what fire, earthquake, flood, environmental, or other of conditions may be? Essentially everyone in the property transfer business who is charged with trying to predict whether or not the home they are insuring, the property they are buying, or the loan they are putting in place on that property is in any way threatened by any condition that could diminish its use, its value, its insurability, or its desirability. There is a body of economic and liability drivers that creates the need for effective property risk information.

     Vertically integrating community data is the next area where the private sector has gone, bringing together with the data and information on the location of things that may or may not affect the desirability or use of a piece of property. For example, if you are in a wetland area or a protected historic zone, it is important to know this so that you can make the most effective decision.

     VISTA's focus is much more heavily on the real estate application. Therefore, properties for sale are vertically integrated into property risk and community data along with topological and geological information. The whole direction of the private sector is to bring all of this information into one location, integrate it, and then make it accessible in various forms and styles for the purpose of being able to make a more effective decision.

     Back in the "dark ages," VISTA built a fire district database. In this particular database, 28,000 fire districts in the United States were surveyed, geographically defined--that is, mapped and the boundaries digitized, and then put through a standard rating process to quantify what they had in the way of a fire protection component, number of full-time and part-time firefighters, equipment, water sources, and so forth. This standard was built for the insurance industry, and it was endorsed by insurance departments as the underwriting standard across the country. This information is available simply by putting a latitude, longitude, or address into a computer. The insurance industry has integrated this into automated underwriting systems across the country, and there is no reason why it couldn't serve other purposes beyond this.

     I cannot tell you more about landslide data than you know already, except that they are vitally important to the participants in the private sector, again be these banks, insurance companies, or you and I as consumers. The same is true with geological hazard or historical wind information. The reality is that the public sector has the greatest control or access to information on what is taking place on a local basis, yet this information is needed very much in the private sector and by consumers overall.

     VISTA is bringing this information together into a common platform. I am going to spend a moment talking about the environmental database again. We work hand-in-hand with environmental organizations across the country, approximately 600 different government organizations, and have built a database of environmental hazards. This database includes information about contamination, regulated facilities, toxic waste sites, storage facilities, and companies that require permits in order to handle the types of material they have. This is a database that we provide to government and to public-interest groups as part of our service for being able to receive these data from them. In the 1990s, VISTA started out with a thesis of building a database of all environmental conditions or records in the U.S. inventory, thinking this information was readily available. However, most of you know how difficult it is to get information, let alone to get it from different agencies.

     In those dark ages we were fairly naïve, thinking that it would be simply a case of going out and getting the records and making them computer addressable. We were very surprised and found that the information just was not available. Over time, however, and with investment, we took 60 million federal, state, and local government agency records and linked them together to create a point-specific record on approximately 4 million active environmental locations around the country. This database covers about a 25-year time span, the 25 years being an approximation of the point of origination of that agency that was responsible for monitoring a location or condition. So, if someone in your community fills out a form about a spill or a leaking tank or a regulated manufacturer of a chemical or a waste product, that form is incorporated into a database by our organization by bringing it in from any one of these 600 federal, state, or local government agencies.

     The good part is where it is today. The hard part was getting here. Sixty million records formally in sites, all integrated into a common database and now residing in an extensible markup language (XML) environment, so that the data can be delivered to whomever has a need for that kind of information. We took it upon ourselves to do the XML mapping of the database because we have the economic incentives to do it. As a result, today you can look at a single point of data, whether it is the number of pounds of a particular material that is regulated or the life history of a tank leak or a Superfund site, and you can monitor it over time or pull out that data element for any issue that comes from the environmental data sets of the nation. Moreover, this information is dynamic. There are about 50,000 changes per month to this particular file. The goal was to bring it all together in a single point or a single location, integrate it geographically, integrate it vertically, and thus make it available to the various people who need it as end users in the private sector. If you type an address into a Web browser, you can get information on a particular property with all of these data integrated in a common manner.

     I suspect that most of you in this room can describe XML better than I can, but let me just take a minute to ensure that we all understand. XML, or derivations of XML, we believe will represent the step that democratizes information, that makes it available to the masses. I know that this is in the mission statement of quite a number of organizations represented here today. XML basically puts data into a common format and makes them Web deliverable. I am greatly oversimplifying, but XML is a language standard that means that when you and I talk about the same common condition, or the same piece of information, we are speaking the same data language as we bring it forward. The beauty of XML is that once a database has been mapped to an XML platform, it is very easy to access on any current or common technology you are working with, and it is easy to deliver this information to a host of new users or end points. I believe that there are a number of XML-style initiatives, and XML has a number of other names within the industry. VISTA has been working for a long time on making our data XML compatible. In addition, there is another initiative under way right now that will touch each and every one of us as consumers, this is the conversion of the U.S. real estate inventory to an XML format.

     We are in the business of delivering information to people who are trying to buy and sell houses, consumers like you and me, agents and brokers who serve us, and the various supplier channels that we go through in the process of moving or buying a house. The real estate listing data that you get from your real estate agent when you go out to look for a home or go on the Web and shop for homes are all moving to an XML platform. This allows us to take your house in Alexandria and overlay on it vertically all the kinds of information that reside elsewhere in our data, therefore enabling you to make an informed or a complete and effective decision, be you a consumer, a lender, or whoever. The development of these data for the real estate industry is being done under the auspices of the National Association of Realtors. VISTA is the technology provider and the XML architect of this initiative, which will have a far-reaching effect on all of us in terms of democratizing access to this information. In the future, all of the things that we commonly work with will be integrated vertically, and we hope to work with all of you in determining how you define and design your systems to make them faster to market or easier to use, or to attain the end goals of building this XML future.

     Why are we doing all this? Obviously we have the profit motive as a private-sector company. However, we are very concerned about bringing information to the public. The consumer "right to know" is well established.

     Today, for example, a consumer can go on the Web, and access www.nearmyhome.com, which is a free site. It allows consumers to type in a zip code and then to navigate with mapping tools down to their homes to see free information on what is going on in their community or neighborhood that may be of interest to them. Right now there are five or six data types that are all related to a neighborhood, yet with each passing month over the next 2 years we will see an additional layer of information being added to this consumer Web site. A layer of data might be a piece of flood information, information on wetlands, information on protected historic districts, and other areas that may be of interest to a consumer. All of this is aimed at making the consumer a participant in the decision-making process.

     Community awareness extends beyond geography to knowing what is going on with the people who are present in the community. You can go to a single Web site, type in the name of a company and get its history, its environmental behavior. For example, we can produce a corporate facility profile, which is an environmental profile of a company that includes the types of content that the Environmental Protection Agency readily makes available, as well as state and local information integrated into it, and put a format that is easily understood by a user.

     As we look at community awareness or regulatory drivers of wanting to know this type of information, the parties that seek most frequently to understand these data are the companies themselves. For example, getting access to spill data from 1981 inside a major chemical manufacturing organization was virtually impossible prior to the development of these integrated databases.

     Today, real estate disclosure requirements mean that these kinds of data have an impact. In 1998, a new law went into effect in California that creates a seller obligation to disclose the presence of natural hazards that may exist around a home. Lack of disclosure carries stiff penalties in California and can upset a real estate sale prior to its close. After the close, there is liability on both the real estate agent's and the seller's part if they fail to disclose. The availability of comprehensive, geographically referenced, environmental information can help relieve this liability, inform the buyer, take the pressure off the seller, and transfer risk onto the insurance industry. It also helps commerce continue to flow. This kind of information product now is evolving nationally. You will see it in the Washington, D.C., area within 3 or 4 months. Florida and Texas are already using this kind of product. The disclosure requirements that come out of the California initiative have been broadly embraced across the country. Why? Because the economic costs of such requirements are small, compared to the liability risks of all players, and it just makes good business sense.

     We also look at our responsibility for monitoring and governance. At VISTA, our information is readily available to anyone on any side of an issue, whether a public-interest group, such as the Sierra Club, any one of the other environmentally oriented public-interest groups, or the government. In fact, when there are major catastrophes anywhere in the country, our information is made freely available to federal agencies so they can respond properly. We give data to the Federal Emergency Management Agency and to others to help them respond to the public need. It is part of the covenant we have as trustees of this information in our sector.

     There is a revolution going on. I am excited about the chance to make this kind of presentation because I know people in industry don't often get the opportunity to show you how the rest of the world is responding to the things that you have access to or are involved in developing. I encourage you to initiate or continue in dialogue with firms on the private-sector side because there is a vast public good to be done, and there is a partnering opportunity for you and us.