ECONOMIC EFFECTS OF RIVER RECREATION ON LOCAL ECONOMIES1

ABSTRACT: Outdoor recreation is a major, growing use of water resources in the United States. The economic effects of expenditures by visitors to three recreational river sites on local economies surrounding the sites were estimated using an input-output model (IMPL.AN). Expenditure data were from the Public Area Recreation Visitors Study (PARVS). Results indicate that visitor spending stimulates a considerable amount of economic activity and growth in local economies. Economic effects include increases in total gross output ranging from $2.6 million to $13.4 million, increases in total income ranging from $1.2 million to $5.6 million, and increases in employment ranging from 60 to 292 jobs.     

The conservation benefits of cost-effective land acquisition: A case study in Maryland

Economic theory asserts that to achieve maximum conservation benefits land acquisition needs to be cost effective. Yet the most common planning technique used by land conservation organizations is ‘benefit-targeting’ that focuses only on acquiring parcels with the highest benefits and ignores costs. Unlike most of the literature which focuses on covering problems, this research applies optimization techniques to achieve maximum aggregate conservation benefits for an ongoing land acquisition effort in the Catoctin Mountain Region in central Maryland. For this case study, optimization yields additional conservation benefits worth an estimated $3.1–$3.9 million or achieves the same level of conservation benefits but at a cost savings ranging from $0.9 to $3.5 million, depending on the initial budget size. Finally, the highest efficiencies are achieved in low budget scenarios, like those most prevalent in conservation efforts.     

Measuring the Net Economic Value of Recreational Boating as Water Levels Fluctuate1

Abstract: The purpose of this article was to show how the value of recreational boating can be assessed and how that value can be linked to water levels. Data were gathered via a survey of recreational boaters to determine days boated and willingness‐to‐pay (net economic value) for boating on Lake Ontario and on the St. Lawrence River in 2002. Depth measurements were taken at marinas and yacht clubs, boat launch ramps, and private docks. Stage‐damage curves were used to pinpoint at what water levels and to what extent boaters would be impacted. Boaters recreated an estimated 1.3 million days in 2002 and spent an estimated US$178 million in New York counties bordering Lake Ontario and the St. Lawrence River. The mean net economic value per day per boat (above current expenditures) was $69.36, with an estimated total net economic value of US$90 million. Using Lake Ontario as an example, the stage‐damage curves show that the overall negative impact would be small, between 245 and 248 ft. Maintaining water levels within that range for the entire boating season would be ideal for Lake Ontario boaters and associated businesses.     

Can California coastal managers plan for sea-level rise in a cost-effective way?

This paper examines five representative sites on the California coast to illustrate a cost-effective methodology using tools and data that local decision makers can apply to analyse the economics of sea level rise (SLR) adaptation. We estimate the costs/benefits of selected responses (e.g. no action, nourishment, seawalls) to future flooding and erosion risks exacerbated by SLR. We estimate the economic value of changes to public/private property, recreational and habitat value, and beach related spending/tax revenues. Our findings indicate that the costs of SLR are significant but uneven across communities, and there is no single best strategy for adaptation. For example, Los Angeles's Venice Beach could lose $450 million in tourism revenue by 2100 with a 1.4 m SLR scenario while San Francisco's Ocean Beach would lose $80 million, but the impacts to structures could total nearly $560 million at Ocean Beach compared to $50 million at Venice Beach.     

The cost of crop damage caused by ozone air pollution from motor vehicles

The effects of ozone air pollution on the agricultural sector are an important environmental challenge facing policy makers. Most studies of the economic impact of air pollution on agriculture have found that a 25% reduction in ambient ozone would provide benefits of at least $1–2 billion annually in the United States. This paper extends existing research by estimating the benefits of a reduction in emissions from a major source of ozone formation: motor-vehicle emissions. An agricultural production model is combined with an analysis of motor-vehicle emissions and air quality to estimate the impacts of emissions from six different motor-vehicle classes, at both the regional and national level. The benefits to the agricultural sector from completely eliminating ozone precursor emissions from motor vehicles ranges between $3·5 and $6·1 billion annually.     

Cost-benefit analysis of an accelerated vehicle-retirement programme

High taxes on new cars in Israel provide an incentive for car owners to defer the purchase of new vehicles. The result is a vehicle fleet of older, more polluting vehicles, with air pollution costs estimated at up to $530 million annually. The purpose of this paper is to conduct a cost benefit analysis (CBA) of an accelerated vehicle-retirement (AVR) programme. The analysis considers the private car fleet as well as trucks and buses. The study develops an economic model to identify the optimal payment level that will maximise the net benefit of the programme, and then apply the model to three different vehicle categories. It finds that an AVR programme for private cars may indeed yield significant net benefits, while a similar programme for trucks and buses fails to meet the cost-benefit test. For private cars, the study finds that even according to a conservative estimate, the programme will result in the voluntary retirement of approximately 98,000 private cars, with a present value net benefit of more than $50 million. This is equal to a 17% reduction in total annual private car air pollution costs for the five-year time span of the proposed programme.     

Increasing the public benefits of agricultural conservation easements: an illustration with the Central Valley Farmland Trust in the San Joaquin Valley

Agricultural conservation easements (ACEs) involve the significant expenditure of public funds through either tax benefits and/or direct public expenditures. The selection of agricultural parcels for conservation should, therefore, maximise net public benefits to the extent possible within financial constraints and the need for agricultural viability to maintain working landscapes. Some programmes select agricultural parcels for conservation easements based only on agricultural viability and/or land cost, however, without explicit consideration of the many other public benefits often associated with ACEs. This paper illustrates application of a method for increasing the public benefits of agricultural conservation easements through a case study in the northern San Joaquin Valley of California. The method is a strategic planning process that incorporates both a GIS-based quantitative assessment and a more qualitative assessment. Such an approach is a supplement to – rather than a substitute for – the more science-based Landscape Evaluation and Site Evaluation (LESA) approach developed by the US Soil Conservation Service (SCS) and cost-minimisation approaches that emphasise economic considerations. However, we show that public land use planning and regulatory policies are essential for agricultural conservation. Acquisition strategies in isolation will not be successful without complementary public regulatory policies.     

ECONOMIC EVALUATION OF RIPARIAN BUFFERS IN AN AGRICULTURAL WATERSHED1

ABSTRACT: This study determines the most cost effective spatial pattern of farming systems for improving water quality and evaluates the economic value of riparian buffers in reducing agricultural nonpoint source pollution in a Midwestern agricultural watershed. Economic and water quality impacts of alternative farming systems are evaluated using the CARE and SWAT models, respectively. The water quality benefits of riparian buffers are estimated by combining experimental data and simulated water quality impacts of fanning systems obtained using SWAT. The net economic value of riparian buffers in improving water quality is estimated by total watershed net return with riparian buffers minus total watershed net return without riparian buffers minus the opportunity cost of riparian buffers. Exclusive of maintenance cost, the net economic value of riparian buffers in reducing atrazine concentration from 45 to 24 ppb is $612,117 and the savings in government cost is $631,710. Results strongly support efforts that encourage farmers to develop or maintain riparian buffers adjacent to streams.     

Resident Motivations and Willingness-to-Pay for Urban Biodiversity Conservation in Guangzhou (China)

The monetary assessment of biodiversity measures the welfare damages brought by biodiversity losses and the cost-benefit analysis of conservation projects in a socio-economic context. The contingent valuation method could include motivational factors to strengthen economic analysis of nature conservation. This study analyzed Guangzhou residents’ motivations and willingness-to-pay (WTP) for an urban biodiversity conservation program in the National Baiyun Mountain Scenic Area (BMSA). The peri-urban natural site, offering refuge to some endemic species, is under increasing development pressures for recreational and residential use. A questionnaire survey was conducted in the Guangzhou metropolitan area during June to October 2007. We interviewed face-to-face 720 stratified sampled households to probe residents’ attitudes towards the city’s environmental issues, motivations for urban nature conservation, and WTP for biodiversity conservation. Principal component analysis identified five motivational factors, including environmental benefit, ecological diversity, nature-culture interaction, landscape-recreation function, and intergenerational sustainability, which illustrated the general economic values of urban nature. Logistic regression was applied to predict the probability of people being willing to pay for the urban biodiversity conservation in BMSA. The significant predictors of WTP included household income and the factor nature-culture interaction. The median WTP estimated RMB149/household (about US$19.5/household) per year and an aggregate of RMB291 million (approximately US$19.5/household) per year and an aggregate of RMB291 million (approximately US38.2 million) annually to support the urban conservation project. Including public motivations into contingent valuation presents a promising approach to conduct cost-benefit analysis of public projects in China.     

Potential of the Conservation Reserve Program to control agricultural surface water pollution

The Conservation Reserve Program (CRP), initiated by the Conservation Title of the Food Security Act of 1985, is the primary federal program to control nonpointsource pollution in agricultural watersheds of the United States. However, the program is designed primarily to reduce soil erosion rather than to retire croplands in a manner optimal for controlling runoff of sediment and associated pollutants. This study estimates potential enrollment of streamside and floodplain croplands in this ten-year retirement program in order to gauge the potential of the CRP as a water-quality improvement policy. A contingent choice survey design was employed in Fayette County, Illinois, to demonstrate that there is substantial potential for retirement of streamside and floodplain croplands in the CRP. Enrollments in each program climb from less than 6% to over 83% of eligible croplands as the annual rental rate is increased from $20 to $200/acre. Potential retirement of streamside and floodplain croplands declines, however, if tree planting, drainage removal, or a 20-year contract are required. The potential of a CRP-based water-quality program to improve water quality and aquatic ecosystems in agricultural watersheds is thus substantial but constrained by the economic trade-offs that farmers make between crop production and conservation incentives in determining the use of their riparian lands.     

VISITOR VALUES AND LOCAL ECONOMIC IMPACTS OF RIPARIAN HABITAT PRESERVATION: CALIFORNIA'S KERN RIVER PRESERVE1

ABSTRACT: Preservation of the few remaining ecologically vital riparian areas in the southwestern United States is a significant policy concern. This article reports on two economic aspects of preserving a nationally renowned riparian birding area in Southern California. First, the article examines visitor willingness to pay (WTP) for habitat restoration and estimates an annual WTP of US $77 per visitor to preserve the habitat, about a half‐million dollars a year for estimated visitor numbers in 2000 and 2001. Second, it documents visitor expenditures in the local economy to be approximately three‐quarters of a million dollars per year. This direct visitor spending attributable to the riparian habitat generates around US $1.3 million in increased local business activity in this relatively remote rural area.     

Prioritizing Agricultural Lands for Conservation Buffer Placement Using Multiple Criteria1

Qiu, Zeyuan, 2010. Prioritizing Agricultural Lands for Conservation Buffer Placement Using Multiple Criteria. Journal of the American Water Resources Association (JAWRA) 1-13. DOI: 10.1111/j.1752-1688.2010.00466.x Abstract: Although conservation buffers are multifunctional, the current conservation buffer planning strategies tend to use a single criterion, most frequently a hydrological or soil condition indicator, to guide conservation buffer placement. This study presents a watershed planning approach that prioritizes agricultural lands for conservation buffers based on multiple selection criteria and applies the approach to Raritan Basin in central New Jersey. The multiple selection criteria include soil erodibility, hydrological sensitivity, wildlife habitat, and impervious surface rate. These criteria capture the conservation buffers’ benefits in reducing soil erosion, controlling runoff generation, enhancing wildlife habitat, and mitigating stormwater impacts, respectively. An expert panel was used to identify and define the section criteria, review the measured values of those criteria, and develop the classification scales that assign the class score to each criterion. The prioritization is based on the summation of the criteria class scores. About one-third of agricultural lands are prioritized for conservation buffers in Raritan Basin. The total program cost of converting those prioritized agricultural lands to conservation buffers in Raritan Basin is estimated to be between $54.8 and 102.9 million depending on the composition of installed conservation buffer practices.     

Evaluation of the impact of forest reserves on harvesting costs and provincial revenues in ontario

The establishment of forest reserves for the benefit of other resources and other land uses in areas where timber harvesting is taking place constitutes a significant withdrawal of wood fiber annually in Ontario.This article reports on a case study carried out on a representative forest area in northern Ontario where the primary land use is timber extraction. The results projected to the whole province show that the direct cost to the provincial economy of removing these forest lands from timber production is of the order of $2.5 million annually.     

Balancing Conservation and Economic Sustainability: The Future of the Amazon Timber Industry

Logging has been a much maligned feature of frontier development in the Amazon. Most discussions ignore the fact that logging can be part of a renewable, environmentally benign, and broadly equitable economic activity in these remote places. We estimate there to be some 4.5 ± 1.35 billion m³ of commercial timber volume in the Brazilian Amazon today, of which 1.2 billion m³ is currently profitable to harvest, with a total potential stumpage value of $15.4 billion. A successful forest sector in the Brazilian Amazon will integrate timber harvesting on private lands and on unprotected and unsettled government lands with timber concessions on public lands. If a legal, productive, timber industry can be established outside of protected areas, it will deliver environmental benefits in synergy with those provided by the region’s network of protected areas, the latter of which we estimate to have an opportunity cost from lost timber revenues of $2.3 billion over 30 years. Indeed, on all land accessible to harvesting, the timber industry could produce an average of more than 16 million m³ per year over a 30-year harvest cycle—entirely outside of current protected areas—providing $4.8 billion in returns to landowners and generating $1.8 billion in sawnwood sales tax revenue. This level of harvest could be profitably complemented with an additional 10% from logging concessions on National Forests. This advance, however, should be realized only through widespread adoption of reduced impact logging techniques.     

THE BUREAU OF RECLAMATION'S ROLE IN AMERICA'S GROWTH1

ABSTRACT. The Bureau of Reclamation was created to implement the Reclamation Act of 1902 and subsequent legislation to conserve and develop the water resources of the western states for maximum efficient use. This has been accomplished by the planning and construction of major multiple use projects which now supply water to approximately eight million acres of land which annually produce 52 million tons of food and fiber with a gross crop value of approximately $2 billion. Fifteen million people are served with municipal and industrial water supplies and hydroelectric power from Bureau projects now returns $160 million annually to the Treasury. Flood control, recreation, and fish and wildlife enhancement are other major benefits. The Bureau of Reclamation is now undertaking a Westwide Survey of water resources and of the needs of the future which is more far-reaching than anything heretofore accomplished. The information accumulated during this ten-year survey will determine whether there is a necessity for consideration of major interbasin transfer of water supply.     

Regional economic impacts of Grand Canyon river runners

Economic impact analysis (EIA) of outdoor recreation can provide critical social information concerning the utilization of natural resources. Outdoor recreation and other non-consumptive uses of resources are viewed as environmentally friendly alternatives to extractive-type industries. While outdoor recreation can be an appropriate use of resources, it generates both beneficial and adverse socioeconomic impacts on rural communities. The authors used EIA to assess the regional economic impacts of rafting in Grand Canyon National Park. The Grand Canyon region of northern Arizona represents a rural US economy that is highly dependent upon tourism and recreational expenditures. The purpose of this research is twofold. The first is to ascertain the previously unknown regional economic impacts of Grand Canyon river runners. The second purpose is to examine attributes of these economic impacts in terms of regional multipliers, leakage, and types of employment created. Most of the literature on economic impacts of outdoor recreation has focused strictly on the positive economic impacts, failing to illuminate the coinciding adverse and constraining economic impacts. Examining the attributes of economic impacts can highlight deficiencies and constraints that limit the economic benefits of recreation and tourism. Regional expenditure information was obtained by surveying non-commercial boaters and commercial outfitters. The authors used IMPLAN input-output modeling to assess direct, indirect, and induced effects of Grand Canyon river runners. Multipliers were calculated for output, employment, and income. Over 22,000 people rafted on the Colorado River through Grand Canyon National Park in 2001, resulting in an estimated $21,100,000 of regional expenditures to the greater Grand Canyon economy. However, over 50% of all rafting-related expenditures were not captured by the regional economy and many of the jobs created by the rafting industry are lower-wage and seasonal. Policy recommendations are given for increasing the regional retention of rafting expenditures and for understanding both the beneficial and adverse impacts that accompany outdoor recreation in rural areas.     

ECONOMIC ANALYSIS OF WETLAND RESTORATION ALONG THE ILLINOIS RIVER1

Creating and restoring wetland and riparian ecosystems between farms and adjacent streams and rivers in the Upper Mississippi River Basin would reduce nitrogen loads and hypoxia in the Gulf of Mexico and increase local environmental benefits. Economic efficiency and economic impacts of the Hennepin and Hopper Lakes Restoration Project in Illinois were evaluated. The project converted 999 ha of cropland to bottomland forest, backwater lakes, and flood‐plain wetland habitat. Project benefits were estimated by summing the economic values of wetlands estimated in other studies. Project costs were estimated by the loss in the gross value of agricultural production from the conversion of corn and soybean acreage to wetlands. Estimated annual net benefit of wetland restoration in the project area amounted to US$1,827 per ha of restored wetland or US$1.83 million for the project area, indicating that the project is economically efficient. Impacts of the project on the regional economy were estimated (using IMPLAN) in terms of changes in total output, household income, and employment. The project is estimated to increase total output by US$2,028,576, household income by US$1,379,676, and employment by 56 persons, indicating that it has positive net economic impacts on the regional economy.     

The Economic Value of Open Space: A Review and Synthesis

/ Communities increasingly face development pressures that can irreversibly alter open space lands. While the monetary costs and benefits of development are typically known, the corresponding values of natural lands are complex and difficult to measure. This paper reviews different concepts of economic value in relation to open space, describes methods for quantifying these values, and presents examples of each from published literature. Open space benefits accruing to citizens as market values or consumers' surplus include market and enhancement values, production values, natural systems value, use and nonuse values, and various intangible values. Economic impacts that open space lands have on local communities and economies include fiscal impacts on municipal budgets, expenditures from open space-related activities, and impacts from employment and tax revenues. These values are not universally present within a given community, nor are they quantitatively additive. However, a comprehensive consideration of the multiple values of open space will better inform community decisions about land conservation and development. KEY WORDS: Conservation; Economic value; Land use; Open space; Zoning     

MEASURING ECONOMIC LOSSES FROM GROUND WATER CONTAMINATION: AN INVESTIGATION OF HOUSEHOLD AVOIDANCE COSTS1

ABSTRACT: Economic losses from ground water contamination were estimated in a central Pennsylvania community. The averting expenditures method was applied via a mail survey of households in which water contained the unregulated volatile organic chemical, perchloroethylene (PCE). Expenditures were estimated at $148,900 (1987 dollars) over the six-month contamination period or approximately $252 per household annually. These costs underestimate the lower bound measure of welfare losses to households from ground water contamination. An upper bound measure of welfare losses was estimated at $383 per household annually. These estimates do not represent the full economic losses resulting from ground water contamination since the study did not address municipal-level and business avoidance costs and losses from actual health effects, increased fear and anxiety, ecological damages, and nonuser ground water benefits. The results expand the existing empirical base of information about municipal-level responses and economic losses from ground water contamination to include household-level impacts. The findings indicate that households undertake substantial averting actions in response to ground water contamination and that such actions can have significant economic consequences. The extent and magnitude of avoidance costs documented suggests that policy-makers should give greater attention to this category of economic losses.     

THE ROLE OF AGRICULTURAL GROUNDWATER CONSERVATION IN ACHIEVING ZERO OVERDRAFT IN ARIZONA1

ABSTRACT: The elimination of groundwater overdraft was a key feature of the 1980 Arizona Groundwater Management Act. To achieve this goal, the Arizona Department of Water Resources identified several Active Management Areas and developed urban, industrial, and agricultural water conservation plans. This study examines the reductions in groundwater use through agricultural water conservation in the Phoenix Active Management Area (AMA). Linear programming models are developed to analyze changes in groundwater use and net returns to agriculture over a 38-year period, 1990 to 2025, for farming areas in the Phoenix AMA. Results indicate that the agricultural conservation program provides only modest groundwater savings under a wide range of scenarios. The low level of savings is partly due to the current economically efficient use of water. Other policy measures such as retiring agricultural land may be necessary if the Phoenix AMA is to meet its overdraft reduction goals; even if urban water conservation goals are met.