Regional economic impacts of water management alternatives: the case of Devils Lake,North Dakota,USA

Devils Lake, located in a closed basin in northeastern North Dakota has over a century-long history of highly fluctuating water levels. The lake has risen nearly 25 feet (7.7 m) since 1993, more than doubling its surface area. Rising water levels have affected rural lands, transportation routes, and communities near the lake. In response to rising lake levels, Federal, state and local agencies have adopted a three-part approach to flood damage reduction, consisting of (1) upper basin water management to reduce the amount of water reaching the lake, (2) protection for structures and infrastructure if the lake continues to rise, and (3) developing an emergency outlet to release some lake water. The purpose of this study was to provide information about the net regional economic effects of a proposed emergency outlet for Devils Lake. An input-output model was used to estimate the regional economic effects of the outlet, under two scenarios: (1) the most likely future situation (MLS) and (2) a best case situation (BCS) (i.e., where the benefits from the outlet would be greatest), albeit an unlikely one. Regional economic effects of the outlet include effects on transportation (road and railroad construction), agriculture (land kept in production, returned to production sooner, or kept in production longer), residential relocations, and outlet construction expenditures. Effects are measured as changes in gross business volume (gross receipts) for various sectors, secondary employment, and local tax collections. The net regional economic effects of the proposed outlet would be relatively small, and consideration of these economic impacts would not strengthen the case for an outlet.