A RATIONALE FOR THE REGIONALIZATION OF PUBLIC WATER SYSTEMS1

ABSTRACT. A rationale is set forth for requiring and/or encouraging the consolidation or regionalization of all systems beneath certain population size levels based on the small water systems’ capability to produce an adequate supply of safe drinking water at a reasonable cost to customers. Estimates for basic costs of water service including personnel, other operation and maintenance and capital are made and a range of water rates is suggested based on reasonableness and acceptability to customers. Guidelines are then drawn for a moderate rate of $10.00 per month and an upper limit rate of $15.00 per month to show the sizes at which public water systems might be expected to achieve fiscal viability. Finally, recommendations are made to State and Federal governmental agencies concerning possible legislation, plans and programs to achieve better public water service through the regionalization or consolidation of small public water systems.     

FEDERAL SUBSIDY OF IRRIGATION DEVELOPMENT1

ABSTRACT: The Congress of the United States has been concerned about public lands from the earliest days of this republic. The importance of irrigation on these public lands was explicitly noted with enactment of the Carey Act of 1884. This was reinforced with the passage in 1902 of “An Act appropriating the receipts from the sale and disposal of public lands in certain states and territories to the construction of irrigation works for the reclamation of arid lands.” This Act further specified that land so irrigated would be entered under the provisions of the Homestead Laws and developed in units of not less than 40 nor more than 160 acres. The enforcement of the 160 acre limitation has been reinforced by several recent lawsuits. These have reaffirmed the provisions of the Reclamation Law requiring owners receiving water from Federal projects to sell land in excess of 160 acres. While there have been Federal subsidies involved in the development of irrigation in the western states, the total amount of the subsidies are insignificant compared to the total Federal budget and the size of subsidies under other Federal programs. Thus, the real question in enforcing the 160 acre limitation may well be one of land reform rather than the distribution of Federal subsidies.     

Assessing flood mitigation,management, and enforcement using insurance data,California and the USA

Previous research found that National Flood Insurance Program (NFIP) premiums collected in some U.S. states, including California, have far exceeded damage payments. However, this finding raises the question of whether such an imbalance represents systematically good flood management or, instead, merely short-term hydrologic good luck. This study investigated patterns in flood losses on structures that pre-date and post-date the first available flood maps (“pre-Flood Insurance Rate Map [FIRM]” vs. “post-FIRM”) in California, several peer states, and nationwide. California has a larger inheritance of pre-FIRM structures than the national average, apparently reflecting development during the latter half of the 20th Century but before most Federal Emergency Management Agency (FEMA) flood maps. Pre-FIRM properties are a disproportionate cost burden on the system, and the number of pre-FIRM policies has declined over time, but only slowly. Local patterns in pre-FIRM claims suggest targeted areas for enhanced mitigation efforts, including buyouts. Conversely, we find that claims on post-FIRM policies are a reasonable metric of good floodplain management and enforcement, and California's 38% of post-FIRM policies generated just 24% of the state's NFIP claims. Local “post-FIRM claim hotspots” suggest areas to examine more closely. California continues to be a net payer into the National Flood Insurance Program, with $102 million in payouts 2009–2018 versus $2.3 billion in premiums collected, or 4.5 cents of premiums collected for every dollar of premiums. In California, its peer states, and nationwide, future management of flood risk depends on: (1) continued investment in flood control and mitigation of existing floodplain structures, and (2) prudent planning and limitations on new floodplain and coastal development.     

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.     

A hedonic model of public market transactions for open space protection

A hedonic price function is estimated that illustrates how the price per acre of open space paid by public buyers such as counties or land trusts, is influenced by local demand and supply factors. The empirical regression model is illustrated using 133 public transactions (73% are purchases and 27% are easements) of open space in the Front Range of Colorado. The mean price per acre was $13 635. If a property provides access to water bodies, this feature increases the price per acre by $937, while adjacency of the parcel to existing park or open space adds $11 039 an acre. A 1% increase in county population results in a 0.27% increase in price per acre. Easements cost $6783 less than purchases, a sizeable cost saving. The prediction capability of the hedonic price equation may be an alternative to traditional real estate appraisal techniques when agencies must determine fair market values of prospective open space parcels that vary in attributes from existing ones.     

PUBLIC EXPENDITURE PROGRAMS IN APPALACHIA AND THEIR IMPACT ON REGIONAL EMPLOYMENT1

ABSTRACT: The reduction of regional unemployment requires a sufficient demand for regional labor and the demand pattern must parallel that of supply. Due to the interdependency of Appalachian economy with the rest of the Nation, the leakage of the final demand imposed on a subregion of Appalachia is substantial. The more capital intensive the investment the higher the leakage which will lead to less demand for labor in Appalachia. While water resource projects are generally longterm projects which aim at structural changes in a regional economy, consumption expenditures induced by welfare payments or public employment programs are basically temporary measures for the rescue of unemployment. Average consumption and private investment programs may impose on Appalachia a larger material demand but the demand for the total regional labor, off-site and on-site combined, is estimated to be less than that from water resource investments. The public expenditure program for combating regional unemployment must be discretionary based on its purpose and its potential to generate optimum demand for labor which will be created by the pattern of regional resource distribution and interindustrial and interregional interactions. An interregional I/O model is best suited for analysis of this type.     

AESTHETIC PREFERENCE FOR WATER RESOURCE PROJECTS: AN APPLICATION OF Q METHODOLOGY1

ABSTRACT Many of the resources generating aesthetic and visual benefits are publically owned and their optimum use and development depends upon public investment. Traditionally, public investment decisions have been couched in economic terms requiring quantitative measurement of benefits and costs. Since many of the benefits these resources provide are not consumed when they are enjoyed, the total contribution of the resource is imperfectly measured in the usual market sense. Thus, if the provision of these public goods is left to the conventional market mechanism, less than socially optimal investment may occur. This study was designed to investigate whether aesthetic preferences related to water projects could be determined, and whether they differ among different groups of people. A Q sort of 44 photographs of a wide variety of water development projects was conducted with two groups, i.e., photographers (aesthetic man) and town assessors (economic man). The resultant analysis identified two significant factors. Factor 1 provided insight into a hypothesis of nature dominant or man dominant scenes. Factor 2 indicated that the respondents had a negative preference for projects which were in varying stages of completion or appeared to be polluted. Preferences were consistent between the two groups tested. The test revealed that people do not necessarily equate only naturalness with aesthetic appeal, but will accept development as aesthetic, provided that it is designed to complement the natural landscape.     

Making private capital flows to developing countries environmentally sustainable: the policy challenge

The 1990s have seen a dramatic shift in capital flows into the developing world. Despite pledges made at the 1992 UNCED Conference in Rio de Janeiro, official development aid has declined in real terms. At the same time, private direct investment and lending to developing countries has risen from $44 billion at the beginning of this decade to $256 billion in 1997, supporting a record economic boom in the developing world. Developing countries have become significant sources of capital, as well as hosts to transnational corporations.
Cases illustrating the negative impacts of large investments under environmentally lax conditions are contrasted with the rise of environmental screening of funds by commercial entities, such as banks, insurance companies and investors. Although the new inflows of foreign capital may have brought the spread of Western consumerism, this new economic potential has also contributed cutting-edge environmental technologies, that may assist developing countries leapfrog over the most damaging phases of industrialization.
The article discusses the role of public lending agencies, international organizations and NGOs in setting the investment climate that determines the effects of foreign capital on the natural resources base, communities and the environment. Various mechanisms for defining environmental standards are discussed, and a more active role for governments and the United Nations is advocated.     

Tourism and wetland conservation: application of travel cost and willingness to pay an entry fee at Ghodaghodi Lake Complex,Nepal

This study investigated the need and applicability of wetland tourism for resource conservation, using the case of Ghodaghodi Lake Complex, a Ramsar Site in western Nepal. The travel cost method (TCM) was used to determine the recreation potential of the lake complex, while the contingent valuation method (CVM) was used to calculate willingness of visitors to pay an entry fee as a payment vehicle for conservation. The per capita travel cost was found to be NPR 540 (US $7.71), while the mean willingness to pay an entry fee was NPR 34 (US $0.48) per visitor per entry. In addition, factors affecting wetland visitation rates and maximum willingness to pay were identified. Policy implications include the establishment of an entry fee system to offset conservation budgetary constraints, government investment in social benefits equating to at least per capita travel cost identified, and public‐private partnerships, with community participation in tourism promotion and wetland conservation.     

A comparison of two models for dealing with urban solid waste: Management by contract and management by public–private partnership

In work, we compared two models for dealing with urban solid waste in Brazil, namely, management by contract and management by public–private partnership. Management by contract, which is widely used by the public sector (municipalities) for urban solid waste collection and disposal and for acquiring goods and services for periods not greater than 60 months, is governed by Federal Law 8.666/93. Management by public–private partnership is governed by Federal Law 11.079/04 for contracts worth more than US$11,000,000 and involves costs for the private partner and public partner. The financial return for the private partner must be clearly delineated and the contract should last from 5 to 35 years. Management by public–private partnership that involves the management of municipal solid waste is very recent in Brazil. For this reason, the comparison between the two forms of management of municipal solid waste (management by contract and management by public–private partnership) described in this work is unprecedented in this country. Both of these models are used in the municipality of São Bernardo do Campo in the State of São Paulo, Brazil. For this study, information was gathered through semi-structured interviews with public works managers in São Bernardo do Campo, with members of an Association of Recyclable Material Collectors and with managers of a company contracted by the São Bernardo do Campo city hall, and also by researching public documents provided by the city hall. The interviews with the managers of the municipality of São Bernardo do Campo, the Association and the company were held in the headquarters of each institution. The documents analyzed, such as the plan for dealing with municipal solid waste, contracts and bids were made available electronically. Analysis of the results indicated that management by a public–private partnership was more advantageous for dealing with urban solid waste than management by contract since the former provided a strong selective collection program, reduced the amount of solid waste sent to sanitary embankments, led to the recovery an area of land previously degraded by the incorrect disposal of urban solid waste and stimulated the installation of an energy recovery unit.     

THEORY AND REALITY IN ALLOCATING FEDERAL RESOURCES TO WATER RESOURCES DEVELOPMENT1

ABSTRACT: Federal spending on water resource development projects exceeds $10 billion annually. This paper examines the economic theory and practice on which the Federal water resource development plans are based. Existing theoretical and applied problems result in overinvestment. These include 1) no standard of value for the tradeoff of environmental objectives with economic objectives; 2) benefits based on “willingness to pay,” but beneficiaries pay only a fraction of a project's costs; 3) beneficiaries “shop around” among program purposes in order to reduce their commitments; and 4) benefit/cost (B/C) analyses are based on a discount rate, which is consistently below the Federal borrowing rate. Furthermore, the Government Accounting Office (GAO) frequently finds that the agency regulations are inadequate and result in inconsistent and questionable benefit computations. The President has proposed a series of water policy reforms, to reduce some of the apparent overinvestment in water resource development, but fundmental corrective action rests with the members of Congress.     

A MODEL FOR ACHIEVING CONSISTENCY FOR COST SHARING IN WATER RESOURCE PROGRAMS1

ABSTRACT: Three basic principles of responsibility have influenced the Federal/non-Federal cost sharing rates for water resources programs (1) full payment by beneficiaries (2) exclusive Federal assumption of costs and (3) joint Federal/non-Federal sharing. The efforts to determine appropriate cost sharing rates have resulted in several hundred complex arrangements involving contributions, user charges and direct sales based on many variations of payment terms. This basic present value model was developed to determine the non-Federal cost shares which are expected to be paid for 32 different functional purposes emanating from Federal water resources programs and projects for both implementation and OMR stages. The model introduces the concept of a composite (implementation plus OMR) cost share as a focus developing appropriate cost sharing rates for the private, public and mixed outputs produced through public water resources investments. The model can be used as a focus for policy decisions on cost sharing which seek to achieve consistent and equitable cost shares for purposes provided while maintaining an efficient allocation of resources within water programs.     

MINING AGREEMENTS IN DEVELOPING COUNTRIES-ISSUES OF FINANCE AND TAXATION

This article continues a Forum series on recent trends in mining contracts between host countries and foreign investors begun in the April 1977 issue. Based on intensive research carried out for the preparation of a book on Mining Ventures in Developing Countries , published recently in the Federal Republic of Germany, the authors discuss sources of finance, institutions, exchange controls and special accounts, royalties, income taxation, and equity participation. They conclude that taxation is most likely to remain the principal source of income; equity participation should be evaluated carefully as it does not automatically guarantee maximum benefits. The combination of taxes and royalties provide a steady flow of income. An increase of the total tax burden beyond a certain percentage may be counterproductive for the host country, as it encourages the investor to look for less controllable means of shifting profits or discourages investment for exploration and development.     

IMPROVING URBAN WATERWAYS IN EMERGING COUNTRIES: AN ACTION PLAN FOR MADRAS1

ABSTRACT: Typically, infrastructure agencies build massive water projects to serve expanding populations in emerging country cities, but collect and treat only a fraction of the resulting wastewater. This effluent often overwhelms existing sewerage systems and fouls waterways. Cleaning urban waterways requires large investments over long terms and the political will to make and sustain them. This challenge - difficult in advanced countries - becomes daunting with the scarce resources and weak institutions typical of emerging countries. This paper presents a framework to structure such a strategy, and applies it to Madras, India. It consists of three parts: (1) setting a vision through a participatory process; (2) macro investments mainly in wastewater treatment that use least-cost methods; and (3) micro investments in small projects that involve local people and galvanize public support. The macro investment, $350 million for Madras, appears very large, but averages out to $66 per capita, far below the $1,000-$2,000 typical of advanced country cities. Micro projects to be undertaken by Non-Governmental Organizations (NGOs) included an independent wastewater monitoring program, sanitary upgrading of slums along waterways banks, a cattle waste demonstration project, and an industrial pollution survey. Together, a macro/micro strategy promises the funding and political will to achieve a balanced vision of waterways quality.     

THE CENTRAL ARIZONA WATER CONTROL STUDY: A CASE FOR MULTIOBJECTIVE PLANNING AND PUBLIC INVOLVEMENT1

This paper describes the successful application of a multiobjective planning framework, incorporating substantial public involvement, to a major water resources decision involving intense confilcts. The study was initiated to help resolve more than a decade of controversy over a project proposed to control flooding and provide regulatory storage in the Phoenix, Arizona, area. The public was actively involved in the development of study goals and the specification of acceptable tradeoffs between multiple objectives. A wide range of structural and nonstructural alternatives was formulated and evaluated in relation to these objectives, and broad-based support was developed for a new plan. Reasons for the successful outcome are discussed, as well as implications for water resources planning under the new Federal Principles and Guidelines.     

Adding public value: The limits of corporate responsibility

It is suggested that natural resource companies undertaking large-scale projects may be expanding the scope of corporate social responsibility by working to enhance the capabilities of the public sector. Naturally companies are concerned to protect their investments, and to ensure their viability. They will therefore invest in necessary infrastructure and facilities of all types, where those are lacking. Such investment often provides benefits to the wider community, but with a few exceptions these are normally incidental byproducts rather than inherent objectives. The motivation for companies to provide resources of all types in order to enhance the capabilities of the public sector to provide public services is usually an expectation is that the tangible benefits will exceed the costs, rather than altruism. One driving force is to secure and maintain a company's social licence to operate. More recently competition from Chinese firms is prompting private sector companies to offer comparable investments in infrastructure. It is unclear whether investment in public sector capabilities is cyclical and liable to cutbacks when market conditions deteriorate. Changing market conditions affect not just corporate willingness to spend but also host countries’ bargaining strengths. In boom periods host countries will be more able to secure straightforward financial benefits through higher tax receipts than when markets are weak. Beyond the specific needs of individual projects corporate policies are strongly influenced by the beliefs of senior managers. External pressures both from international institutions and from NGOs also drive corporate behaviour. The success of investment in public sector capabilities relies in the end on the responses of host countries, and on how closely the objectives and interests of the government are aligned with maximising the nation's long term wealth and welfare. Where they are not corporate resources may be frittered away. There are also questions over the legitimacy of corporate investments, especially by foreign-owned companies. They have a right to offer advice and protect their legitimate interests, but these may not always coincide with those of their host countries. There is a range of questions about the appropriate role of companies, which lead on to feasible and effective ways of improving weak governance.     

ENFORCEMENT LIMITATIONS IN WATER QUALITY CONTROL1

The Federal role in the enforcement of water quality requirements is of recent development. It began with the enactment in 1956 of the Federal Water Pollution Control Act as permanent law. It has been expanded by successive amendments to the Act to cover the pollution of navigable as well as interstate waters which endangers the health or welfare of persons, and to cover violations of water quality standards established for interstate waters. Two different enforcement procedures are prescribed in the law to be followed in the two types of enforcement actions. While questions have arisen of jurisdiction, States' rights, and disregard or duplication of local efforts, such questions do not lastingly impede the exercise of Federal enforcement authority and are of value in establishing a body of precedents. Limitations have their basis in the statutory distinctions between interstate and intrastate pollution which govern the application of the enforcement authority, even though a case of intrastate pollution may be as serious or more serious than a case of interstate pollution. An additional limitation results from the statutory time intervals between procedural stages in an action. Lack of data is a limitation but can always be overcome and at most causes delay. State laws which protect the confidentiality of required reports are more of a limitation. Investigative teams may obtain the needed information, however, for consideration in public meetings. Public support for effective water quality control measures, especially enforcement, and for the expenditures needed to enhance the environment, is widespread. Such support may be instrumental in modifying or eliminating existing statutory limitations.     

Developing new environmental excellence programs: Lessons from epa's environmental leadership program

Interest in the concept—and implementation—of environmental excellence is at an all-time high. A wealth of examples from individual companies, trade associations, states, industry coalitions, and the federal government illustrate the growing acceptance by a wide range of stakeholders of a management systems approach to environmental issues. Perhaps nowhere is this more clear than in the collection of public comments submitted to EPA in response to its January 15, 1993, Federal Register notice, which proposed the creation of an Environmental Leadership Program (ELP). The authors, both of whom worked on the ELP, review these public comments and offer a set of “do's and don'ts” for organizations interested in establishing an environmental excellence program. In addition, the authors outline the Green Track proposal, a plan to structure an alternate regulatory pathway based on environmental excellence.     

RURAL HOUSEHOLD RESPONSE TO WATER CONTAMINATION IN WEST VIRGINIA1

ABSTRACT: About one-third of all West Virginians obtain domestic water from private water wells. In this research, mail and telephone surveys were used to investigate household responses to bacteria, mineral, and organic chemical contamination of domestic water supplies. Of households who were informed of contamination and acknowledged the problem, over 85 percent took action to avoid exposure to water contamination problems. The most common action was to clean and/or repair the water system (55.9 percent of valid surveys). Approximately 45 percent of households made investments of either a water treatment system, a new water source, or correction of contamination source. The average, annual economic cost of rural household actions was $320 for bacteria, $357 for minerals, and $1,090 for organic contamination. These economic costs represent a lower bound estimate for rural household willingness-to-pay (WTP) for a reduction in domestic water contamination from government action. On average, investment actions had lower annual economic costs than noninvestment actions of boiling and hauling water so that households who undertook investment actions in response to water contamination would have a lower WTP for government action to reduce water contamination. When effectiveness of water treatment systems was evaluated, treatment systems which require minimal household maintenance were found to reduce exposure to water contamination to safe levels as households intended when they installed the system. Treatment systems which were commonly ineffective included those which required continual maintenance (e.g., chiorinators) or were not designed to solve the contaminant problem for which they were purchased (e.g., filter systems for bacteria).     

New strategy in urban water management in Mexico: the case of Mexico's Federal District

This paper focuses on the strategy of Mexico's Federal District to achieve better water management. It highlights some of the main aspects of the current institutional framework. The article starts by providing a general overview of the current state of the water sector in Mexico. An analysis of the new strategies for the provision of water services in Mexico's Federal District is presented as a case study. It exemplifies the type of private sector participation that has recently been adopted in the water sector in Mexico. The article analyzes the functions of agencies involved in water distribution in the Federal District, and discusses the performance of private firms as well as some of the main difficulties encountered. Lessons have been learned from this application. It can be concluded that long-term commitment on the part of both public and private entities is one of the key factors in achieving a more efficient urban water management. The article reflects plans implemented and approved as of January 1998.