Valuing Preservation and Improvements 

of Water Quality in Clear Lake

Christopher Azevedo, Joseph Herriges, and Catherine Kling

Staff Report 01-SR 94

March 2001 

Center for Agricultural and Rural Development

Iowa State University

Ames, Iowa 50011-1070

www.card.iastate.edu

Christopher Azevedo is a postdoctoral research associate, Center for Agricultural and Rural 

Development (CARD). Joseph A. Herriges is a professor of economics, Department of 

Economics, Iowa State University. Catherine L. Kling is a professor of economics, Department of 

Economics, and head of the Resource and Environmental Policy Division (CARD), Iowa State 

University.

The authors would like to thank the following individuals for their help in survey design and data 

collection: John Downing, Jeff Kopaska, Kevin Egan, Jay Corrigan, Jinhua Zhao, David Knoll, Jim 

Wahl, and the participants of the Clear Lake focus group.

For questions or comments about the contents of this paper, please contact Catherine L. Kling, 

568 Heady Hall, Iowa State University, Ames, IA 50011-1070Ph: 515-294-5767, Fax: 515-294-

6336, e-mail: ckling@iastate.edu. Joseph A. Herriges, 280D Heady Hall, Iowa State University, 

Ames, IA 50011-1070; Ph: 515-294-4964, Fax: 515-294-0221, e-mail: jaherrig@iastate.edu.

This publication is available online on the CARD website: www.card.iastate.edu. Permission is 

granted to reproduce this information with appropriate attribution to the authors and the Center for 

Agricultural and Rural Development, Iowa State University, Ames, Iowa 50011-1070.

Iowa State University does not discriminate on the basis of race, color, age, religion, national origin, sexual 

orientation, sex, marital status, disability, or status as a U.S. Vietnam Era Veteran. Any persons having 

inquiries concerning this may contact the Director of Affirmative Action, 318 Beardshear Hall, 515-294-7612.
ii

Contents

Abstract.............................................................................................................................. iii

Introduction..........................................................................................................................1

Survey Design and Implementation.....................................................................................1

Survey Results .....................................................................................................................4

Conclusions........................................................................................................................16

Endnotes.............................................................................................................................18

Appendix A. Visitor’s Survey ...........................................................................................19

Appendix B. Local Resident’s Survey...............................................................................29
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Tables

Table 1. Average number of trips by time period................................................................5

Table 2. Average number of trips taken to other lakes and reservoirs ................................5

Figures

Figure 1. Clear Lake activities.............................................................................................5

Figure 2. Importance points.................................................................................................6

Figure 3. Projects: visitors...................................................................................................7

Figure 4. Projects: local residents........................................................................................8

Figure 5. Land use changes: visitors....................................................................................8

Figure 6. Land use changes: local residents ........................................................................9

Figure 7. Willingness to pay for Plan A: visitors ..............................................................11

Figure 8. Willingness to pay for Plan A: local residents...................................................12

Figure 9. Willingness to pay for Plan B, low improvement, visitors ................................14

Figure 10. Willingness to pay for Plan B, low improvement, local residents...................14

Figure 11. Willingness to pay for Plan B, high improvement, visitors .............................15

Figure 12. Number of trips taken at varying quality levels...............................................16
iv

Abstract

This report presents summary statistics and other results of a survey of Clear Lake 

visitors and residents. The purpose of the survey was to collect information concerning 

use and value of water quality improvements at Clear Lake. Support for the survey was 

provided by the Iowa Department of Natural Resources.
VALUING PRESERVATION AND IMPROVEMENTS

OF WATER QUALITY IN CLEAR LAKE

Introduction

This report describes the results of a study on Clear Lake as a recreational resource. 

It is intended to provide information on recreational usage of the lake, attitudes of 

recreators and local residents toward possible watershed management changes, as well as 

estimates of visitor’s and resident’s willingness to pay for water quality improvements at 

the lake. 

Survey Design and Implementation

In this section of the report, we provide an overview of the procedures used in 

selecting the samples and designing the Clear Lake Survey, the implementation 

procedures used to administer the survey, and the final survey response rates. 

Sample Selection

Two groups of respondents were targeted to receive the survey: recreational users 

(visitors) of the lake and local residents. Although other population segments may value 

water quality improvements at Clear Lake, for example to protect the wildlife habitat the 

lake provides to migratory birds, we believed that the largest values would be associated 

with those who actually visit the lake or live in its vicinity. However, it is important to 

note that all of the information provided in this report relates only to those two population 

segments: those who have visited the lake at least once, and those who have residences in 

the cities of Clear Lake or Ventura, Iowa. 

To obtain addresses of visitors to the lake, potential respondents were intercepted 

while engaging in recreational activities at the lake. This occurred during the months of 

May, June, July, August, and September of 2000. A total of 1,024 recreators agreed to 

participate in a mail survey that was scheduled for October of that year. They were 
2 / Azevedo, Herriges, and Kling

informed that everyone who returned a completed survey would receive five dollars. The 

sample of local residents was provided by Survey Sampling, Inc., a sampling firm located 

in Connecticut. The sample of 900 names was randomly drawn from the white page 

listings for the cities of Clear Lake and Ventura, Iowa. 

It is important to note that the sampling of visitors on site, as was done here, will 

produce a sample that does not accurately represent the true population of visitors. This is 

because individuals who take more than the average number of trips have a higher chance 

of being intercepted and interviewed than their true representation in the population. 

Likewise, individuals who take fewer than the mean number of trips will be underrepresented in the sample. It is thus necessary to adjust the data by re-weighting the 

observations so that they appropriately represent the actual population. All summary 

statistics reported here have already been appropriately adjusted.

Structure of the Survey

The surveys mailed to the two groups (visitors and residents) were very similar. The 

survey was designed to focus on how the respondent values different levels of water 

quality at Clear Lake. In order to provide a baseline level of quality for the respondent, 

current conditions at Clear Lake were described. This description was developed in 

consultation with limnologists John Downing and Jeff Kopaska of the Animal Ecology 

Department at Iowa State University, both of whom have studied the water quality 

conditions at Clear Lake. Both versions of the survey contained the following description 

of the current conditions at the lake. 
Valuing Preservation and Improvements of Water Quality in Clear Lake / 3

Respondents were then presented with various plans, each describing a different 

overall condition of the lake (as defined by the above attributes), and were asked about 

their willingness to pay for the plan. Plan A described a decrease in water quality, and 

Plan B described an increase in water quality. Data pertaining to both of these plans will 

be summarized below.

In addition to the valuation questions, both versions of the survey also contained 

questions pertaining to the respondents’ support for various projects for improving water 

quality, their opinion concerning various land use changes, and the water quality 

attributes most important to them. Finally, socioeconomic information was gathered from 

all respondents.

The visitor’s and resident’s versions of the survey differed in that the visitor’s 

version collected information on the number of recreation trips the respondent took to the 

lake in the past year, as well as information on the number of trips the respondent 

planned to make in the coming year under various scenarios. The visitor’s and resident’s 

versions of the survey are contained in Appendixes A and B.

Water clarity objects distinguishable 6 inches to 1 

foot under water

Algae blooms 10 to 12 per year

Water color bright green to brown

Water odor mild odor, occasionally strong

Bacteria possible short-term swim advisories

Fish low diversity, good walleye

Overall, the current condition of Clear Lake can be summarized in terms of

general water color
4 / Azevedo, Herriges, and Kling

Response Rates

The visitor’s version of the survey was mailed in mid October while the resident’s 

version was mailed in early December. For both versions, respondents who did not return 

the survey were sent a reminder postcard approximately two weeks after the initial survey 

was mailed. After approximately two more weeks, survey recipients who still had not 

returned the survey were sent a second copy of the survey. Of the 1,024 surveys mailed to 

the group of visitors, 26 were returned by the post office as undeliverable. Of the 

deliverable surveys, 662 were returned, resulting in a 66 percent response rate. Of the 900 

surveys mailed to the group of local residents, 132 were returned as undeliverable. Of the 

deliverable surveys, 443 were returned, resulting in a 58 percent response rate.

Survey Results

In this section of the report we provide summary statistics from the Clear Lake 

survey, focusing on (a) reported visitation and spending patterns, (b) attitudes toward 

various watershed and land use changes, and (c) implied valuations.

Visitation

On average, visitors reported a high usage of Clear Lake between November 1999 

and October 2000. The average total number of trips taken was 6.6. Of those trips, an 

average of 2.67 were multiple day visits (i.e. the respondents spent at least one night in or 

around Clear Lake). Respondents indicated that they expected to make an average of 6.63 

trips to Clear Lake over the next year. Respondents reported having visited Clear Lake an 

average of 3.63 times over the past five years. Table 1 shows the average number of trips 

(both multi-day and single-day) reported by time period, while Figure 1 shows the 

average percentage of time devoted to various activities reported by respondents. As 

expected, a majority of trips were taken during the summer months. The most popular 

recreation activity engaged in by visitors was recreational boating. 

Table 2 shows the average number of trips taken from November 1999 through 

October 2000 to other lakes and reservoirs. Minnesota lakes, Saylorville Lake, the 

Mississippi River, and other unlisted lakes appear to be the main alternatives to Clear Lake. 
Valuing Preservation and Improvements of Water Quality in Clear Lake / 5

TABLE 1. Average number of trips by time period

Time Period Number of Visits

November 1999 through February 2000 0.62

March 2000 through May 2000 1.13

June 2000 through August 2000 3.70

September 2000 through October 2000 1.13

FIGURE 1. Clear Lake activities

TABLE 2. Average number of trips taken to other lakes and reservoirs

Lake or 

Reservoir

Number 

of Visits

Lake or

Reservoir

Number 

of Visits

Lake Okoboji-East and West 0.98 Lake Odessa 0.05

Lost Island Lake 0.03 Rathbun Reservoir 0.97

Rice Lake 0.36 Mississippi River 0.77

Spirit Lake 0.23 Minnesota Lakes 1.76

Storm Lake 0.10 Wisconsin Lakes 0.19

Tuttle Lake 0.04 Lake Red Rock 0.40

Saylorville Lake 1.96 Other 2.78

Coralville Reservoir 0.12
6 / Azevedo, Herriges, and Kling

Spending

Respondents reported spending an average of $51 in or near the town of Clear Lake 

on a typical visit. Respondents from Iowa reported spending an average of $48 per trip, 

while out-of-state respondents reported spending an average of $93 per trip.

Spending can also be categorized by the type of trip taken. Respondents who took 

only single-day visits reported spending an average of $26 per trip, while respondents 

who took only multi-day visits reported spending an average of $98 per trip. 

Opinions

Respondents were asked to allocate 100 importance points to the lake characteristics 

listed in Figure 2. The average point allocation is shown for both visitors and residents. 

Safety from bacterial contamination is the most important characteristic for both visitors 

and local residents. As expected, those characteristics associated with water recreation 

are slightly more important to visitors, while water clarity and lack of water odor are 

slightly more important to local residents.

FIGURE 2. Importance points
Valuing Preservation and Improvements of Water Quality in Clear Lake / 7

Figures 3, 4, 5, and 6 show respondent’s opinions toward various water quality 

projects and land use changes. In general, both visitors and local residents appear to 

either support, or are indifferent to, most projects and land use changes. Very few 

respondents in either group oppose repair of storm drains or restoration to Ventura 

Marsh. Restrictions on residential development are supported by roughly 75 percent of 

local residents surveyed, with fewer than 10 percent opposing restrictions.

The issue that generated the most opposition among respondents was the institution 

of non-motor boat days. Roughly 40 percent of visitors oppose non-motor boat days, with 

about 34 percent supporting them. In the case of local residents, roughly 30 percent 

oppose non-motor boat days, while about 45 percent support them. Increased no-wake 

zones are supported by about 60 percent of local residents and about 43 percent of 

visitors. Roughly 70 percent of local residents and only about 37 percent of visitors 

support limiting motor horsepower. There appears to be wide support for restoration of 

woodlands, prairies, and wetlands in both groups.

FIGURE 3. Projects: visitors
8 / Azevedo, Herriges, and Kling

FIGURE 4. Projects: local residents

FIGURE 5. Land use changes: visitors
Valuing Preservation and Improvements of Water Quality in Clear Lake / 9

FIGURE 6. Land use changes: local residents

Valuation

One important goal of the survey was to estimate the value that both visitors and 

local residents place on the preservation and/or restoration of Clear Lake. Conservation 

budgets are tight and there are more projects than there is money to fund them. Thus, 

society must decide where to focus the available resources, both private and public 

sources. To help with these decisions, economists have devised methods to measure the 

value people place on environmental goods as measured by their willingness to pay for 

the goods. Two of these techniques are employed in this study. The first method is based 

on observing the public use of a natural resource (visits to the lake) and inferring visitors’ 

willingness to pay for the resource from their behavior. The second method is based on 

directly asking whether people are willing to pay various sums of money to support a 

particular project. 

The first value estimated in this study is the willingness to pay for the existing level 

of Clear Lake visits. This can be thought of as providing a baseline of the value visitors 

place on preserving the existing level of the resource in terms of how much enjoyment 

they get from Clear Lake at its current level of water quality. Based only on the reported 

single-day trips data, the average recreational value per season of Clear Lake is $28 per 

visitor. Analysis of multiple-day trips has not been completed to date and is not 
10 / Azevedo, Herriges, and Kling

represented in this value. Since 25 percent of the reported trips to the lake were multipleday trips, they represent a potentially significant source of value.

Next, the value of various water quality changes was estimated. Both the visitor’s 

and resident’s version of the survey contained a scenario entitled Plan A. The description 

of the plan stated that if nothing is done to improve the water quality of the lake, it is 

likely to deteriorate over the next decade. Specifically, respondents were told to suppose 

that the conditions at Clear Lake were as follows:

They were then asked the following question, “Would you vote yes on a referendum 

to maintain the current water quality of Clear Lake and avoid the deteriorated water 

quality as described under Plan A? The proposed project would cost you $B (payable in 

five [$B/5] installments over a five-year period). In this question, the value of “B” was 

varied so that different respondents were faced with different project costs.1 Figure 7 

plots the relationship between the percentage of visitors indicating they would be willing 

to pay the stated amount along the horizontal axis. Roughly 85 percent would be willing 

to pay $30 toward this plan ($6 annually for five years), but only about 20 percent would 
Valuing Preservation and Improvements of Water Quality in Clear Lake / 11

FIGURE 7. Willingness to pay for Plan A: visitors

be willing to pay $150. Based on these data, the average willingness to pay is 

approximately $104 per visitor in support of Plan A.2

Figure 8 plots the relationship between the percentage of local residents indicating 

they would be willing to pay the stated amount along the horizontal axis. Though the 

trend is somewhat less pronounced for the local residents, statistical analysis clearly 

indicates that fewer people are willing to contribute at the higher bid levels. On average, 

local residents would be willing to pay approximately $568 in support of Plan A. This 

significantly higher value for residents is not surprising given their continuous exposure 

to the lake and its attributes. 

While Plan A focused on the respondent’s willingness to pay to avoid a deterioration 

in water quality, Plan B focused on willingness to pay for improvements in water quality. 

Two versions of Plan B were created: the first described a program that would result in a 

moderate improvement in water quality over the next five to ten years, while the second 

described a program that would result in a substantial improvement in water quality over 

the next ten to twenty years. Both versions are shown below. 
12 / Azevedo, Herriges, and Kling

FIGURE 8. Willingness to pay for Plan A: Local residents
Valuing Preservation and Improvements of Water Quality in Clear Lake / 13

Figure 9 shows the data from the visitor’s survey for the low quality improvement. 

As before, the relationship between the percentage of respondents indicating they would 

be willing to pay the stated amount of the horizontal axis is plotted. Based on these data, 

visitors would, on average, be willing to pay approximately $85 in support of the low 

quality improvement described in Plan B. 

This value is actually less than the $104 visitors were willing to pay for Plan A, 

which simply maintained the current lake conditions. However, the two results are not 

statistically different, suggesting that visitors are willing to pay roughly $100 to maintain 

the lake, but little, if any, for modest improvements.

Figure 10 shows the data from the local resident’s survey for the low quality 

improvement. Based on these data, local residents would, on average, be willing to pay 

approximately $550 in support of the low quality improvement described in Plan B. 

Again, this value is slightly lower than the $568 local residents were willing to pay for 

Plan A, though the two are not statistically different. This indicates that local residents 

are willing to pay roughly $550 to maintain the lake, but little, in any, for modest 

improvements. 
14 / Azevedo, Herriges, and Kling

FIGURE 9. Willingness to pay for Plan B, low improvement: visitors

FIGURE 10. Willingness to pay for Plan B, low improvement: local residents
Valuing Preservation and Improvements of Water Quality in Clear Lake / 15

Figure 11 shows the data from the visitor’s survey for the high quality improvement. 

Based on these data, visitors would, on average, be willing to pay approximately $425 in 

support of the high quality improvement described in Plan B. 

In addition to the values described above, visitors indicated that the quality changes 

described in the survey would affect the number of trips they would expect to take. As 

described above, visitors indicated that they took an average of 6.60 trips between 

November 1999 and October 2000. They also reported that over the course of the next 

year they expected to make 6.63 trips to Clear Lake. After each quality change plan was 

described, the respondent was asked to consider all the recreation trips they made to 

Clear Lake in the past year, and report the number of trips they would have made if 

conditions were as described in the plan. This information is summarized in Figure 12.

The response to the decreased water quality described in Plan A is dramatic. With 

the decrease in water quality, visitors would take an average of about two trips. Visitors 

also responded to the higher water quality scenarios by indicating that they would 

increase the number of trips they would take. With the low quality improvement, 

respondents would take an average of 7.03 trips, while with the high quality 

improvement, respondents would take an average of 10.32 trips.

The average income level reported for the visitor’s survey was $45,000. Average 

household size was about 3 people, and about 61 percent of the respondents were male.

FIGURE 11. Willingness to pay for Plan B, high improvement: visitors
16 / Azevedo, Herriges, and Kling

FIGURE 12. Number of trips taken at varying quality levels

The average income level reported for the local resident’s survey was $40,000. 

Average household size was about 2.5 people, and about 67 percent of the respondents 

were male.

Conclusions

Clear Lake is very important as a recreational resource, with visitors reporting high, 

persistent usage of the lake. Both visitors and residents indicated a high willingness to 

pay to avoid further deterioration of the lake. When asked about their willingness to pay 

for improvement, respondents indicated that they are willing to pay only moderate 

amounts for a low quality improvement to the lake, but they are willing to pay 

substantially more for a significant quality improvement to the conditions at the lake. 

This strong preference for the high quality improvement over the low quality 

improvement is also borne out by the number of trips visitors expect to take under each 

scenario. With the current conditions, visitors reported that they expect to take 6.63 trips 

next year. The expected number of trips falls to about 2 trips under Plan A (deteriorated 
Valuing Preservation and Improvements of Water Quality in Clear Lake / 17

quality). With the low quality improvement, the expected number of trips is 7.03, not 

much different than the expected number of trips under current conditions, which is 

consistent with the relatively low values reported for Plan A. However, with the high 

quality improvement, the expected number of trips jumps significantly, to about 10. 

Thus, respondents appear to highly value avoiding further deterioration to the lake, and if 

quality is to be improved at the lake, they indicate a strong preference for a high quality 

improvement.

Finally, it is important to remember that the value estimates presented in this paper 

are point estimates. That is, though they are not reported in this paper, there is a sampling 

error associated with each estimate. For example, the point estimate for the local 

residents’ willingness to pay for Plan B is $550 with a margin of error of ± $226.3
Endnotes

1. The value of “B” varied between $15 and $150 for visitors and between $45 and $450 for local 

residents.

2. The value of $104 was generated via a formal statistical model. 

3. This margin of error represents a 90 percent confidence interval.
Appendix A

Visitor’s Survey 
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Appendix B

Local Resident’s Survey
30 / Azevedo, Herriges, and Kling
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