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The US Congress designated the Buffalo River in northern Arkansas as America's first National River in 1972, on the hundredth anniversary of the designation of Yellowstone as America's first National Park. Since then, the Buffalo National River has become the destination for over a million visitors annually, who float its "wild and scenic" waterways, hike along its bluffs, explore its caves, and fish and hunt its wildlife. The surrounding watershed areas are dominated by cattle ranching, poultry and dairy farms, and logging operations. These agribusiness activities hold the potential to cause serious pollution damage to the river as the watershed develops economically. Pollution damage could diminish the quantity and quality of recreational use of the National River. Relevant government agencies have responded to this potential crisis by licensing and regulating farming, forestry, and recreational operations within the watershed. This study provides an overview of the economic and political situation in the Buffalo National River watershed, and discusses policy options for dealing with pollution damage in the future.
Purpose of This Study
This study was sponsored by the Buffalo River Stewardship Foundation. While our sponsors share with the authors an environmentalist and conservationist outlook, this study will present opposing viewpoints and data which support other outlooks, and our conclusions were unbiased by any pre-determined goals. This study is intended to provide guidance to our sponsors in the best use of their resources. An unprejudiced appraisal of economic and political reality will avoid wasting the resources of the Stewardship Foundation and other concerned parties on unattainable or unfeasible goals. Finally, this study is intended to provide a source of information for wider discussion among the agencies and persons involved with the Buffalo National River watershed, so that all relevant parties can agree on mutually acceptable policies addressing both environmental and economic development goals. This study reviews pollution trends and recreational use trends, but is intended to provide an overview rather than a thorough analysis. We refer the reader to the ongoing National Park Service and Soil Conservation Service studies for more detailed analyses of pollution trends and land use trends. We are indebted to both the NPS and the SCS for generously providing their data and opinions. We also are grateful to the Stewardship Foundation for their sponsorship, and especially to Mr. Tim Jones for his enthusiastic support in preparing this study. We thank the long list of all those who we interviewed for this study, only some of whom are cited in the text.
Definitions, Regulatory Background, and Assumptions
We define the BNR Watershed as Marion, Newton, and Searcy Counties. The Buffalo National River (BNR) itself travels through those counties, but its tributaries flow from surrounding counties as well (Baxter, Boone, Pope, and Stone Counties). This study is intended to address pollution problems within the entire Buffalo River watershed, the region in which all water flows into the Buffalo River rather than into some other river. The boundaries of the watershed do not fall neatly along any political boundaries, so we use the three primary counties as a proxy for the watershed itself. Some parts of all three primary counties are outside the watershed, but the parts of other surrounding counties which are in the watershed and outside of our definition roughly compensate for the difference.
We define "agribusiness uses" as farms, ranches, livestock, and logging within the watershed. These uses constitute the primary employment activities in the watershed, as well as the primary sources of pollution. Hog farms and poultry farms contribute to pollution in the BNR by the runoff of hog manure and poultry litter. Both types of farms are regulated as "confined animal operations," but even those farms following regulations can contribute to fecal contamination during rainstorms. To address rainstorm runoff, "wet waste" operations (which includes most hog operations) are more heavily regulated than "dry waste" operations (which includes most poultry operations). Dairy farms and cattle ranches contribute to pollution by the trampling and grazing of riverbanks by cattle as well as by manure runoff. This problem is exacerbated by the widespread incidence in northern Arkansas of fescue toxicosis, an endophyte infection which causes a low-grade fever in cattle, so that they prefer to stand in water and hence directly deposit manure into feeder streams. Crop farms are not as prevalent in the watershed as livestock farms, but cropland as well as cattle pastures contribute to pollution by the runoff of fertilizer (often poultry litter).
Logging operations fall into two categories: privately-owned timber, and acreage owned by the United States Forest Service (USFS). In both categories, standing timber protects the BNR by absorbing agricultural runoff, and by buffering river volume fluctuations by holding water during rainfalls. Clear-cut acreage further contributes to BNR pollution by causing topsoil runoff. Private landowners have an incentive to clear-cut because US tax rules allow for an investment tax credit for clear cutting to offset profits from the sale of timber. Therefore, many private landowners "invest" in the conversion to pastureland, rather than harvest timber as an ongoing enterprise. A further incentive for conversion is the current high price for beef relative to timber; this incentive will diminish as prices go to the other end of their five- to seven-year cycles. In addition, the one-way flow of land use from timber to cattle (two weeks to turn a forest into pasture, but twenty years to turn a pasture into forest) implies that deforestation is a significant long-term pollution problem. The USFS land is not subject to tax credits for clear cutting, but the USFS subsidizes over-cutting by allowing below-cost timber sales. The USFS mission of combined recreation and timber production implies selective cutting instead of clear cutting. Nevertheless, the USFS still clear-cuts timber in the watershed (USFS practices are currently under appeal by the Sierra Club Legal Defense Fund).
"Recreational uses" means boating, hiking, camping, hunting, and fishing in the BNR watershed, as well as businesses related to recreation, travel, and tourism. We assume that all visitors to the three-county area are visiting for the purpose of recreational use of the BNR. The NPS directly controls which businesses may locate within park boundaries, but their jurisdiction extends only within the narrow boundaries. The primary NPS regulatory tool is the licensing of canoes, which limits the number of recreational concessionaires along the BNR (one canoe permit also allows two rafts, and johnboats are unregulated). Visitors who own their own recreational equipment are not subject to any regulations or fees. The NPS does "close" sections of the river when water levels or pollution levels are deemed unsafe, but closures are mainly enforced via commercial concessionaires.
We assume that all relevant reducible pollution is caused by agribusiness activity. Pollution caused by recreational activity, such as trash and human waste, we assume is minimal. Certainly tourists should be advised that they should take care where they dispose of wastes, but recreation-based waste is not addressed by this study or any of the relevant agencies active in the watershed. Wildlife-based pollution (such as fecal coliform contamination from beavers) is also assumed to be minimal compared to domesticated animal wastes, and is similarly not addressed in this study since it is not subject to reduction by policy action. Since the costs of enforcing any control measures on tourists or wildlife is quite prohibitive due to the transitory nature of these populations, such regulation would not be a feasible policy option, even in the unlikely event that these sources were found to be major polluters.
We define "financial value" to mean actual costs, and "economic value" to include costs other than dollars and costs to other parties. Financial values mean the dollars that are spent by the person or agency undertaking the activity. Other "external costs and benefits" are included in the economic value, as are distributional costs and benefits, impact on taxes, impact on employment, and so on.
Description of the Buffalo National River
The Buffalo River meanders through northern Arkansas for a distance of 132 miles. Its watershed covers 1,338 square miles (860,000 acres). The National River area extends for about a mile on each side of the river, except in three wilderness areas, where the park is wider. The tributaries which feed the Buffalo River are all outside the park boundaries, except for a small section along Richland Creek. The Buffalo is renowned for its limestone bluffs and countless caves, which extend up the tributaries and into the surrounding hills. The watershed is also famous for its archaeological, botanical, and geological richness. The BNR was established in 1972 in response to popular demand to avoid damming by the US Corps of Engineers. Congress has designated 15.8 miles of the Buffalo "wild and scenic" due to its uniqueness and spectacular scenery. DPC&E has designated seven miles as "threatened" due to pollution. The BNR is the fourth most popular tourist attraction in the state of Arkansas.
Roles of Relevant Agencies
The BNR is regulated and influenced by an array of federal agencies (NPS, USFS, SCS), state agencies (AG&F, DPC&E, Extension Service), local agencies (County Chambers of Commerce), and private organizations (Cattlemen's Association, environmental groups).
Socioeconomic Profile of the Buffalo National River Watershed Region
The BNR three-county region is poor. In terms of per capita income, Searcy County is second poorest of Arkansas' 75 counties. Newton County is tenth poorest, and Marion County is also below the median. About 25% of all people in the three-county region are below the poverty level, compared to 18% for all of Arkansas, and 12% for all of the US. However, real income levels have been growing, faster than the rest of Arkansas and the rest of the US. During the 1980s, the number of people below the poverty line has fallen, while the number of people below the poverty line across the US has risen. The per capita income gap between the three-county region and the rest of Arkansas is shrinking.
People have been moving out of the region, especially Searcy County. Marion County has grown in population, but has grown slower than the rest of the country. The region remains lightly populated, compared with the rest of Arkansas and the US. The three-county region is older than average, and will continue to age. There are significantly fewer young people and many more elderly people in the region compared to Arkansas and the US. The region is less educated than the rest of Arkansas and the rest of the US, although that difference may be largely attributable to the age difference.
Unemployment rates in the three-county region are comparable to Arkansas as a whole, but unemployment is concentrated in Newton and Searcy Counties. Newton and Searcy Counties have consistently suffered higher unemployment rates than Arkansas as a whole, which in turn has consistently suffered higher unemployment rates than the US as a whole. However, as with per capita income, job growth has been much stronger in the three-county region than average, so the unemployment gap is slowly closing.
One in five jobs in the region are in farming and livestock, compared to one in eighteen for Arkansas and one in thirty-seven for the US. The three-county region is heavily oriented towards agribusiness, but earnings in that sector are significantly lower than elsewhere. The low per-job productivity in Marion and Newton Counties suggests that farmers there do not rely on farming income as their sole source of income.
Finally, the number of farms per capita has been holding steady for two decades. The number of farms has been growing in Searcy County, and falling in Marion County, so that the number of farms overall just keeps pace with population growth in the three-county region. There are three times as many farms per capita in the region than in Arkansas as a whole, and nine times as many farms per capita in the region than in America as a whole. The typical farm size is considerably smaller in the three-county region than in the US as a whole, and somewhat smaller than the average Arkansas farm. Farm size has been falling slowly in the 1980s.
Outline of this Study
With this broad background on the politics, economics, and pollution problems of the region, we move on to more specific analysis. Chapter 2 outlines the direct financial benefits of agribusiness use of the BNR watershed, and compares that to the direct financial benefits of recreational use. Chapter 3 compares the economic benefits of agribusiness and recreational use, beyond the direct financial benefits. Chapter 4 assesses trends in pollution levels and in recreational use levels, and looks at possible correlations between increasing pollution and decreasing tourism. Chapter 5 describes the political situation in the BNR watershed region. Chapter 6 outlines a framework in which to analyze policy options for the watershed. Chapter 7 analyzes six policy options within that framework, and makes recommendations for action by the Stewardship Foundation. A series of appendices details our data sources, our methodology, and provides statistics which could be used for further analysis.