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3. Stricter Regulations or Enforcement
Environmental groups must promote any given policy with limited financial and political resources. This section evaluates six policy options that the Stewardship Foundation may want to advocate. It applies the criteria from the analytical framework described in Chapter 6, bearing in mind the political context described in Chapter 5. None of the options meet all of the criteria perfectly, but this analysis does allow the Stewardship Foundation to make decisions about the best use of its limited resources. For each policy option, we first describe the option, then analyze the option using our framework criteria, then recommend a course of action, then cite some anecdotal support for the recommendation.
Expand NPS Acreage?
The National Park Service currently has jurisdiction over 95,000 acres within the Buffalo National River watershed and has the authority to purchase an additional 2,000 acres as they see fit. An act of Congress would be necessary to expand beyond the current authorization of 97,000 acres. Such legislation could expand the park boundaries to include some of the major tributaries, and would hence control land use on acreage immediately adjacent to waterways which contribute heavily to BNR pollution levels. The Stewardship Foundation could lobby Congress to pass legislation authorizing additional acreage for the BNR.
The financial cost of expanding the BNR boundaries would be high, since thousands of acres of land would be purchased at "fair market values." However, that cost would be borne by the federal government, which would view the investment as small, compared to other federal programs, and the financial cost would not be a limiting factor in Congress' decision. The financial burden to the local NPS depends on how much funding the federal government allocates to the BNR's expansion. The economic costs are lower than the financial costs (see Chapter 3), but local residents would be damaged by the BNR's expansion. Because the region is poor (see chapter 1.5), expanding the BNR's boundaries would be viewed politically as taking from the poor (local residents) and giving to the rich (recreational visitors). The distributional economics of the BNR watershed would preclude the expansion of the NPS boundaries, and would preclude the federal purchase of any large acreage, under any federal agency.
In addition, the NPS itself does not support the expansion of the BNR boundaries. The NPS recognizes the preferences of local residents, and places its relationship with its neighbors above that of expansion. The NPS would not exercise its authority to purchase additional acreage even if Congress authorized so. While expanding the BNR's boundaries would certainly reduce pollution levels dramatically, and would certainly improve recreational quality as well, those benefits only occur if the policy is successfully implemented. Without NPS support, without Congressional support, and without local political support, an expansion of the BNR boundaries will never be successfully implemented, and hence this policy has no environmental effectiveness whatsoever. Expanding NPS jurisdiction is an easy answer -- it looks effective at reducing pollution, it looks cheap to local agencies, and it looks sustainable in its legislative permanence -- but it will not succeed in the current political circumstances.
Recommendation 7.1: Do not expand NPS authority.
The National Park Service's stewardship role is best served within its current jurisdiction. Expanding the BNR boundaries would not result in any additional protection.
There are mixed feelings about the role of the NPS. Some people view them as the primary environmental stewards of the region: "NPS looks out for environment, so we don't have to," says one concessionaire. Others view them as having had the BNR degrade on their watch. We saw no strong support for NPS expansion anywhere. When asked what he thought of expansion, a Chamber of Commerce representative said unambiguously, "No. Let's leave it at that."
Institute a Watershed Council?
There are no political agencies with jurisdiction over the entire BNR watershed. The NPS deals only with areas within the park boundaries; the USFS deals only with national forest areas; each county has jurisdiction only over its section of the watershed; the SCS even defines the watershed, in their latest study, as the parts south of the river. The Arkansas State Legislature is the only relevant political entity with jurisdiction over the entire watershed, and the BNR is not high on their agenda. A new "Watershed Council", a political entity with jurisdiction over the entire watershed and only over the watershed, and with a mission to deal with watershed issues, could perhaps best deal with BNR issues. Of the nine National Rivers in America, six have Watershed Councils, which operate with varying degrees of success. The Stewardship Foundation could organize and/or participate as a representative on the BNR Watershed Council.
A Watershed Council would have very low financial costs. It could be financed with federal dollars, depending on its enabling legislation. Its economic cost would be somewhat higher, since all relevant parties would have to invest substantial amounts of time to make a Council work.
A Watershed Council's effectiveness would depend heavily upon its being representative of all viewpoints. The Council should include representatives from the ranching and forestry industries, as well as government agency representatives and environmental representatives. To be effective, the Watershed Council must balance environment and development goals. If any party "politically captures" the Watershed Council, it would be viewed as a tool of the proponents of one side of the issue. An unbalanced Council would lose credibility and legitimacy, and hence would be less effective at watershed protection. The inclusion of all major parties also would ensure political support. Long-term political support for the Council's maintenance is more difficult, since the Council requires an ongoing effort by members, and hence requires an enthusiastic and dedicated leader. The Watershed Council's overall environmental effectiveness depends on what policies it can institute -- it is an intermediate step to some of the other policies described here.
Recommendation 7.2: Include agribusiness representatives on the Watershed Council.
Maintaining a balance between environment and development interests would ensure credibility, garner political support, and make a Watershed Council more effective.
The conventional wisdom is that agribusiness representatives are at odds with environmentalists. Anecdotally, we found that to be untrue -- representatives from all relevant organizations claimed that they wanted good stewardship of the BNR, and that they were good stewards. "We're custodians of the land," says one concessionaire. "We are just as interested in protecting the environment as anyone," says a Tyson Foods spokesperson, "We hunt and fish and swim and boat in these streams just like members of the Sierra Club do." Regarding a watershed council, a Chamber of Commerce member said, "it'd work with all sides." Others agreed that broad representation is essential to a Council's success.
Stricter Regulations or Stricter Enforcement?
There are many environmental regulations in the BNR watershed which are currently going unenforced, because the enforcing agencies recognize the economic difficulties that local residents would have in meeting the requirements. "Best management practices" (BMPs) are widely known, but are often not included in regulations, for the same economic reasons. The Stewardship Foundation could lobby enforcement agencies, especially DPC&E, for stronger enforcement, or could lobby the State Legislature for new laws to require implementation of BMPs.
The financial cost of stricter enforcement is low -- a few more enforcement personnel would make a substantial difference in the watershed. The same applies to a stricter set of regulations -- it is inexpensive to the implementing agency. It is more expensive in economic terms, because the financial burden is borne by relatively poor local residents. The high distributional cost is balanced by high environmental benefits, so that the overall economic cost is moderate.
The environmental impact of this policy would be very high, since it directly affects pollution levels. The enforcement agencies could further concentrate on restricting activities which hurt recreational quality, since that would be the explicit purpose of the increased regulation.
The political opposition to this policy, however, precludes its ever being implemented successfully. State legislators will not vote against the interests of their constituents, and their constituents would be very vocal in opposition to this policy, because it would hurt them financially. Enforcement agencies would be similarly unwilling to further enforce unpopular regulations. If somehow such laws got passed, they would be environmentally effective, and would indeed seem an easy solution for the long term -- but the political climate precludes such laws ever passing.
Recommendation 7.3: No new regulations.
Current regulations would be better enforced with more funding for enforcement agencies and funding for assistance projects.
Subsidized BMPs: The federal government currently subsidizes certain best management practices by splitting the cost 65/35. An animal waste system for a dairy, for example, costs $10,000, of which the government will pay $6,500 (and typically, the dairy farmers install the equipment themselves and pay their share in "sweat equity"). To get federal funds, there are "environmental strings" attached, to ensure BMPs are followed. The program, implemented via the SCS, could institute considerably more BMPs with additional funding. The SCS is currently conducting a study in order to get more funding for assistance in implementing BMPs. We recommend following the SCS model: assist financially with voluntary compliance with existing regulations, and forego making new regulations or enforcing current regulations without financial assistance.
Cattle versus timber prices: Current price structures contribute to the abundance of cattle in the region, because cattle prices are high relative to timber prices. Those prices are cyclical and can be expected to change to higher relative timber prices within two or three years. "With cattle selling for $1 per pound, there's lots of bulldozing. When it's back to 80¢, the bulldozing will stop," says a Cattlemen's Association representative.
Level of protection: "The BNR itself is the best protected river in the US," says a DPC&E representative. Furthermore, agribusiness use in the BNR watershed "is light compared to other Ozark watersheds." Promulgating new regulations is difficult in a context where the level of protection is relatively high, and in a situation where agribusiness use is relatively low. There is currently a moratorium on permits for new livestock operations in the watershed (DPC&E CAO permits), which is expected to last indefinitely.
Institute a Tourism Tax?
Currently, recreational users of the BNR pay a 2% tax on canoe rentals, which is collected via concessionaires and sent to the NPS in Washington. We label as a "tourism tax" any policy such as increasing user fees, instituting entry fees, or dedicating existing revenue streams to pollution reduction in the BNR. A "pollution tax" would achieve the same purpose, of creating a dedicated revenue stream for pollution reduction in the BNR. We explore here a number of aspects of how to implement an environmental tax, any of which the Stewardship Foundation could lobby for.
In financial terms, a tourism tax is fairly inexpensive to implement and inexpensive to those paying it because the tax base is large. In economic terms, a tourism tax could have high benefits, if the revenue is used for pollution reduction, and could have low economic costs, if local residents are exempted from the tax.
Visitors are willing to pay more for recreational use of the BNR than they actually do pay -- a tourism tax would transfer part of that willingness to pay from visitors to polluters, to reduce pollution of the BNR. The polluters themselves could be made to pay -- for instance, by taxing each head of cattle, or some other form of "pollution tax." A tourism tax assumes that the polluters have a "right" to pollute, and asks visitors pay for polluters to give up their right (i.e., pollute a little less). A pollution tax assumes that visitors have a "right" to a clean watershed, and asks polluters to pay for visitors to give up that right (i.e., enjoy a little less clean watershed). The outcome would be the same, in economic terms -- there would be less pollution, for the same money spent. The difference is in political terms (who gets the assignment of "rights") and in distributional terms (who spends the money to pay for the pollution reduction).
In this case, the polluters are all local residents, and constitute a large political constituency. The visitors are all non-local (if locals are exempted from the tax, as discussed below), and are often from out of state (57%, according to our estimates in Table F-1). In political terms, it's clear who has "rights": the polluters do, much more so than BNR visitors. We make no ethical judgment here about the assignment of rights -- we are stating the political reality. Ethically, long-time residents do have a case for the automatic assignment of all rights to them, since the BNR and its concomitant rules were made after their arrival.
In distributional terms, polluters have a strong case also, since the three counties in the watershed represent some of the poorest areas in Arkansas, and indeed one of the poorer areas of the whole United States (see chapter 1.5 for a discussion, and Appendix A for a detailed profile of the region). People coming to the BNR for a recreational visit are likely to be more wealthy than local residents. Furthermore, a tourism tax asks visitors to pay from money which they are voluntarily spending discretionary income, while a pollution tax asks polluters to pay directly from earnings which constitute their livelihood.
Recommendation 7.4.1: Use a tourism tax instead of a pollution tax.
Increasing taxes on recreational activities transfers funds from people outside Arkansas' political constituency, and to one of the poorest areas of the country.
In environmental terms, a tourism tax could be very effective at reducing pollution levels if revenue from the tax is "earmarked" for use in BMP assistance programs. Funding for "best management practices" is the bottleneck in implementation, as discussed in section 7.3. If the revenue is not "earmarked," the pollution impact would be very small, limited only to the pollution decrease associated with the decrease in recreational use (fewer tourists means less trash, etc.). In terms of recreational quality, the pollution improvements are offset somewhat by the decreased quality associated with having to pay more.
In political terms, a tourism tax is supportable, without the expenditure of too much political capital, if local residents are exempted. It is readily sustainable, since once tax revenues begin, there will be a constituency to maintain the revenue flow. Overall, this policy's environmental effectiveness is determined by whether funds are earmarked for pollution reduction. Next we discuss means of implementing a tourism tax.
Tourism Tax Framework
1. Exempt locals: Local residents already shoulder a substantial burden for the river, and they have a certain "right" to use it free, since their families have typically lived there since before the institution of the National River status. A motel room tax, for instance, would automatically exempt locals.
Recommendation 7.4.2: Exempt local residents from the tourism tax.
In order to minimize economic maldistribution and maximize political support, arrange the tax such that local residents pay little or none of it.
2. A tourism tax is only environmentally effective if the revenue is used for environmental improvement. A tourism tax in itself has little effect on environmental quality in the BNR. The little effect it has is due to the decrease in tourism which it will cause. "Best management practices" (BMPs), such as using dead chicken composters, leaving trees standing in gullies, replacing fescue with bermuda grass, and so on, are acknowledged by industry-supported agencies and are recognized as cost-effective. On private land, few BMPs are mandated or even regulated -- most are voluntary practices, which the SCS recommends and provides information. While many small landowners are willing to implement BMPs, most BMPs require a large initial investment, which many small landowners cannot afford. A "tourism tax" could provide funds for subsidizing the initial investment for equipment for BMPs.
Recommendation 7.4.3: "Earmark" revenues for pollution reduction.
A tourism tax is only useful if the revenue is used directly to fund BMPs.
We recommend against a tourism tax without earmarked revenues. This recommendation precludes the NPS from administering the tax -- they must send all revenue to federal general NPS fund. We recommend implementing a tourism tax at the county level or state level, with revenue earmarked for BMPs in the BNR watershed.
Tourism Tax Options
1. Raise the 2% concessionaire tax? Increasing the tax on canoes would further reduce canoe usage, but would certainly raise more revenue for small increases. A better option would be to lobby for legislation to earmark revenue from the canoe tax be to programs which decrease BNR watershed pollution. If possible, the NPS concessionaire tax should be earmarked for local use (as recommended in the Vail Agenda).
2. Tax on motel rooms? Taxing motels in the watershed would focus the tax burden on visitors instead of local residents. Such a tax under state jurisdiction, county jurisdiction, or under the jurisdiction of a new Watershed Council.
3. BNR entry fee? An entry fee to the BNR would be unfeasible -- there are too many entry points, because the river is a "linear park." But if an entry fee ever comes to pass, locals should be exempted. One might look at Figure F-5, the demand curve for the BNR, and estimate how many visitors would still come with higher entry fees (and hence estimate the revenue). Such an estimate would be accurate -- but we do not recommend instituting an entry fee at all.
4. Stumpage tax on tree cutting? A tax on each tree cut would reflect the "environmental externality" of damage to the river. It would be effective only if it could be applied to USFS cutting as well as private cutting. A more effective approach is to change USFS below-cost timber sales and other poor management practices, if forest externalities are to be addressed.
Purchase "Conservation Acreage" along the Tributaries?
The most environmentally sensitive acreage in the BNR watershed is land which borders waterways and has a steep slope. Ensuring that that acreage stays forested, and stays free of cattle, could dramatically decrease manure runoff, soil runoff, and decrease pollution levels in the river in general. The Stewardship Foundation could set up a "conservation acreage" fund to purchase riparian zones along tributaries or land in gullies, and then fence off and grow trees on that land.
The primary barrier to this policy is the financial cost -- the market price for land along tributaries is about $1,500 to $2,000 per acre, and many hundreds of acres would have to be purchased to make a difference in pollution levels. The economic cost is better, since a voluntary sale program would ensure that land remains in its "best use" -- i.e., land which has a higher value as pasture or other agribusiness use would not be sold. A higher price could be offered depending on the "environmental sensitivity" of the particular acreage, and hence pollution levels could be cost-effectively improved. In terms of recreational quality, biodiversity would be increased by having "wild" acreage adjacent to tributaries, but "pristineness" will never be achieved because many abutters would opt not to sell.
The opposition to selling, we conclude, limits the overall environmental effectiveness of this policy option. Many landowners would not sell at any price, because their families have traditionally live on that land and selling it would be viewed as selling one's heritage.
Recommendation 7.5: Lease riparian land rather than purchasing it.
Purchasing conservation acreage will not result in enough acreage owned to make a substantive difference in pollution levels.
Why not just encourage best management practices (BMPs) in all forests in the watershed? While instituting BMPs would be better than the current practices, BMPs are not an ecological panacea. Fast-growing trees (pines and other softwoods) earn more profit than slow-growing trees (oaks and other hardwoods). The USFS has killed off hardwood acreage in "timber conversion" programs to promote better yields. The USFS also encourages "even-aged" forests, where all the trees are roughly the same height so that cutting can occur in larger and more efficient batches. Both practices indeed yield more timber. Both practices also do great ecological harm. Ecosystems consisting of one tree species have less biodiversity (fewer species of animals and plants other than the trees themselves) because many species depend on certain trees or certain habitats which would not exist in a forest with all softwoods (for example, squirrels subsist on acorns from oak trees, and owls subsist on squirrels, so both are absent in a softwood forest). Even-aged ecosystems similarly have less habitat diversity and hence less biodiversity. In summary, forest BMPs are the best management practices for production purposes, but are not the best management practices for ecological purposes.
Conservation acreage, where forests are left in their wild state, are ecologically superior to forests which are managed as timber resources. Conservation acreage would allow mixed-age forests of both hardwoods and softwoods, with their concomitantly higher biodiversity. Increased biodiversity does not decrease pollution levels in the BNR, and hence is not discussed as a criterion in our policy framework, but it does fit the general goals of improved environmental quality in the BNR watershed.
Conservation Easements along the Tributaries?
Leasing "conservation easements" solves many of the problems of the purchasing arrangement described above. As with conservation purchases, riparian land or other environmentally sensitive acreage would be leased, with revenue from a "conservation fund" from donors. The lease would state that the landowner retains ownership rights, and personal usage rights, but yields the right to cut trees, graze cattle, or otherwise commercially use the acreage. The "easement" acreage would be fenced off to prevent livestock intrusions, and would be left to grow wild. The lease would last for twenty or thirty years -- long enough to grow trees, but short enough that landowners could anticipate the lease's termination. Replacing pastures along tributaries, and reforesting steep slopes, would absorb substantial agribusiness runoff and would protect the BNR. The Stewardship Foundation could set up a "conservation easement" fund to lease riparian zones along tributaries or land in gullies, and then fence off and grow trees on that land.
Financially, the cost of conservation leasing is the same as conservation purchases, except that it's considerably easier to start small, since the payments are spread out over many years. Economically, leasing easements is identical to purchasing them -- both imply "best use" choices, and both are inherently beneficial because of their voluntary nature (landowners who would not benefit would simply not participate in leasing). Environmentally, higher prices could be offered for more sensitive acreage, to attempt a thorough "pristine corridor" along tributaries. Pollution level improvements are perhaps limited by restrictions in the leases regarding use of adjacent acreage (many leases would have to be compromise arrangements with landowners, so the effectiveness would be less than outright purchases). Politically, there would be much less opposition than to purchases. Overall, the effectiveness of conservation easements could be very high, and we believe this policy represents the most cost-effective use of effort and resources.
Recommendation 7.6: Establish a "Conservation Easement" fund.
A "BNR Stewardship Foundation" could raise funds from donors to lease and protect environmentally sensitive acreage.
Cost estimates for conservation leases:. A 100-foot zone for 100 miles at $2,000 per acre would cost $5.2 million to purchase (26 acres per mile, if the zone is 100 feet on both sides of the river). Fair market value at the prevailing bank interest rate of 2.5% interest would be $50 per acre per year, which landowners will accept as long as it's more than their profit per acre now (refer to Table 2.2: net income is $74 per acre for cleared farms). Paying above the average profit would require an offer of $75 per acre -- one would therefore need $195,000 per year to lease 100 miles of riparian rights. In addition, electric fence costs $300 per 1/4 mile (farmers would pay for the electricity themselves. Barbed wire costs more, about $900 per 1/4 mile). The fencing cost for 100 miles of easement land would be a one-time expenditure of $240,000.There is a successful precedent of easement programs in the watershed already. In the region around Boxley and in the Richland Valley, much acreage remains under private ownership, though the NPS purchased (as easements) the right to prevent unsightly development. There is a precedent for a "stewardship foundation" as well -- the H.E.R.O.E.S. program (Buffalo Heritage and Economic Resource Organization for Environmental Stewardship) might serve as a model for future foundations.
Other Policy Options
A future study could consider further policy options beyond the six analyzed here. We recommend beginning a future study with an analysis of publicity. First, newspaper articles might correlate with increases and decreases in visitation -- a survey of regional newspapers would be needed. Second, a policy option would be to increase environmental awareness of the problem -- to educate the public about the economic impact of BNR cleanup. One concessionaire says, "pollution means trash from tourists."