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Valuation of Natural Resource Improvements in the Adirondacks

This report is highlighted in the Summer 2005 issue of Resources;
the feature article is available for download below. 

Residents of New York place at least a $48 per household per year value on improvements in air and water quality that they would be willing to support to ensure the sustainability of the Adirondack ecosystem at a high level, according to a new RFF Report,  Valuation of Natural Resource Improvements in the Adirondacks, by RFF scholars  Spencer Banzhaf, Dallas Burtraw, David Evans, and Alan Krupnick.

Depending on the statistical approach used, the estimates could exceed $159 per household. With seven million households in the state, this amounts to benefits of such improvements of $336 million to $1.1 billion annually.

That finding was among the results from a carefully designed survey taken to assess how strongly New Yorkers feel about preserving and enhancing the Adirondacks as an environmentally sound recreational and wilderness area.

"Citizens of New York evidently value the beauty and opportunities afforded by the Adirondacks, even if they never intend to visit the area," says Dallas Burtraw, a senior fellow at RFF and a principal author of the study. "These results imply that there is a broad commitment to taking actions - and even bearing the costs, if necessary - to curb the impacts of acid rain and other contaminations that are degrading the region."

Link to RFF Report

Valuation of Natural
Resource Improvements
in the Adirondacks

September 2004

Adirondack Park was established by the New York Legislature in 1892 and covers 20 percent of the state, nearly three times the area of Yellowstone National Park, much of it in wilderness. The area encompasses more than 40 mountains soaring higher than 4,000 feet, six major river basins, and nearly 3,000 lakes, most created by glaciers during the Ice Age. The region also includes the largest assemblage of old growth forests east of the Mississippi.

Countering Effects of Acid Rain

The Park's small, high elevation lakes are particularly sensitive to acidification from airborne deposits of sulfur and nitrogen compounds. State officials have long contended that power-generating plants in neighboring states are the chief contributors of atmospheric pollutants that are key components of acid rain. As many as half of the lakes in the region lack significant aquatic life.

"Many of the lakes appear on the surface as pristine and picturesque settings," says Research Associate David Evans. "But beneath the surface there may be almost no significant fish or plant life because the water has become so acidic."

The Resources for the Future report, financed largely by the Environmental Protection Agency, is the culmination of a five-year project that sought to understand the science of acid rain damage in the Adirondacks, translate that understanding into a sophisticated survey to gauge preferences for improvements in the park ecosystem, and implement the survey through both the Internet and mail.

                      

The research also:

  • Delivers the first estimates of the strength of preferences for Adirondacks improvements (as measured in money terms) for all residents of New York, including those who do not visit the Park. When the Clean Air Act Amendments were passed to address this problem, nothing was known about how strong these values were.
  • Finds that the values aggregated over all New Yorkers account for about 1/10th of the cost of air quality improvements for the entire country. These values would be added to values for Adirondacks improvements held by non-New Yorkers and values held by all U.S. residents for other reasons (such as health, visibility, and materials damages).
  • Appears to help justify further emissions reductions, given that these reductions would yield sizable benefits.

The project employed extensive use of focus groups and utilized a rigorous and carefully crafted survey of a representative sample of over 1,800 New Yorkers to ascertain their inclination to pay for improvement efforts. Administered by Knowledge Networks, an independent and highly regarded survey research firm, the questionnaire was given in the late summer and fall of 2003, at a time when the state was projecting large budget deficits.

"Even though some of our respondents feel their taxes are too high, are living through tight times, and may question some of the science, they care about this resource to the point of being willing to pay something to improve it," says RFF Fellow Spencer Banzhaf.

Determining Willingness to Pay for Environmental Quality

Link to Resources Article

Forever Wild,
But Do We Care?

Summer 2005 Resources

RFF researchers Burtraw, Banzhaf, Evans and Senior Fellow Alan Krupnick presented to survey participants a hypothetical scientific intervention to improve the quality of the lakes, forests, and bird populations that would be applied across wide areas of the region to neutralize acid deposits over a ten-year period and restore normal life in lakes of concern after restocking the lakes with fish.

This ploy was used in order to give respondents a sense that a real-world solution existed and to fairly elicit their preferences for improvements. These preferences need to be quantified in money terms to be compared with the costs of any new programs. "Most people think that further cutting power plant emissions (as well as emissions from other sources) is the long-term solution, and they are right," says Krupnick. "But if you ask people if they are willing to pay for reductions in utility emissions, people simply say it is not the responsibility of taxpayers to solve the problem that was created by the electricity generators - and they won't reveal their preferences for Adirondack clean-up."

The survey found that households with children and those who lived closer to the Adirondack region would benefit more from an improvement program, and respondents who described themselves as liberal were more likely to support the idea than those who said they were conservative. Respondents who were at higher income levels approved the idea more than middle-income households.

 

Valuation of Natural Resource Improvements
in the Adirondacks

RFF Seminar
April 14, 2004
 
Link to Audio of RFF Seminar
Link to Slides of RFF Seminar

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