ENDANGERED SPECIFS PROTECTION 

OVERSIGHT HEARING 

BEFORE THE 

COlVIlVIITTEE ON RESOURCES 

HOUSE OF REPRESENTATIVES 

ONE HUNDRED FOURTH CONGRESS 

SECOND SESSION 

ON 

EXAMINING THE EXPENDITURES OF AGENCIES THAT 

PARTICIPATE IN THE EFFORTS TO SAVE ENDANGERED AND THREATENED SPECffiS 

APRIL 17, 1996-WASHINGTON, DC 

Serial No. 104-65 

Printed for the use of the Committee on Resources 

24-936cc 

U.S. GOVERNMENT PRINTING OFFICE 

WASHINGTON : 1996 

For sale by the U.S. Government Printing Office 

Superintendent of Documents, Congressional Sales Office, Washington, DC 20402 

ISBN 0-16-052816-X 
COMMITTEE ON RESOURCES 

DON YOUNG, Alaska, Chairman 

W.J. (BILLY) TAUZIN, Louisiana GEORGE MILLER, California 

JAMES V. HANSEN, Utah EDWARD J. MARKEY, Massachusetts 

JIM SAXTON, New Jersey NICK J. RAHALL II, West Virginia 

ELTON GALLEGLY, California BRUCE F. VENTO, Minnesota 

JOHN J. DUNCAN, JR., Tennessee DALE E. KILDEE, Michigan 

JOEL HEFLEY, Colorado PAT WILLIAMS, Montana 

JOHN T. DOOLITTLE, California SAM GEJDENSON, Connecticut 

WAYNE ALLARD, Colorado BILL RICHARDSON, New Mexico 

WAYNE T. GILCHREST, Maryland PETER A. DEFAZIO, Oregon 

KEN CALVERT, California ENI F.H. FALEOMAVAEGA, American 

RICHARD W. POMBO, California Samoa 

PETER G. TORKILDSEN, Massachusetts TIM JOHNSON, South Dakota 

J.D. HAYWORTH, Arizona NEIL ABERCROMBIE, Hawaii 

FRANK A. CREMEANS, Ohio GERRY E. STUDDS, Massachusetts 

BARBARA CUBIN, Wyoming SOLOMON P. ORTIZ, Texas 

WES COOLEY, Oregon OWEN B. PICKETT, Virginia 

HELEN CHENOWETH, Idaho FRANK PALLONE, JR., New Jersey 

LINDA SMITH, Washington CALVIN M. DOOLEY, Californil'l 

GEORGE P. RADANOVICH, California CARLOS A. ROMERO-BARCELO, Puerto 

WALTER B. JONES, JR., North Carolina Rico 

WILLIAM M. (MAC) THORNBERRY, Texas MAURICE D. HINCHEY, New York 

RICHARD (DOC) HASTINGS, Washington ROBERT A. UNDERWOOD, Guam 

JACK METCALF, Washington SAM FARR, California 

JAMES B. LONGLEY, JR., Maine PATRICK J. KENNEDY, Rhode Island 

JOHN B. SHADEGG, Arizona 

JOHN E. ENSIGN, Nevada 

DANIEL VAL KISH, Chief of Staff 

DAVID DYE, Chief Counsel 

CHRISTINE KENNEDY, Chief Clerk/ Administrator 

JOHN LAWRENCE, Democratic Staff Director 

(Ill 
CONTENTS 

Hearing held April 17, 1996 .................................................................................. . 

Statement of Members: Cooley, Hon. Wes, a U.S. Representative from Oregon ................................ . Dooley, Hon. Calvin M., a U.S. Representative from California ................. . Gilchrest, Hon. Wayne T., a U.S. Representative from Maryland ............. .. Kildee, Hon. Dale E., a U.S. Representative from Michigan ...................... .. Pombo, Hon. Richard W., a U.S. Representative from California .............. .. Studds, Hon. Gerry E., a U.S. Representative from Massachusetts .......... .. Young, Hon. Don, a U.S. Representative from Alaska; and Chairman, 

Committee on Resources ............................................... .............................. . 

Statement of Witnesses: 

Beattie, Mollie, Director, U.S. Fish and Wildlife Service, Department 

of the Interior .......................... ..................................................................... . Prepared statement ......................................................................... ......... . Genega, Major General Stanley G., Director of Civil Works, U.S. Army 

Corps of Engineers ....................................................................................... . Prepared statement .......................... ........................................................ . Goodman, Sherri W., Deputy Under Secretary of Defense for Environmental Security, U.S. Department of Defense ............................. ......... ... .. Prepared statement .. ................. ....... .................................. ...................... . Hun~r •. Joe, Executive Director, Colorado River Energy Distributors Association ........................................................................................................ . Prepared statement ...................... ..................... .... .. ................................ .. Mazor, David F., Co-Chair, ESA Task Force, National Water Resources 

Association ........................... ...................................... ................................... . Prepared statement ................................................... ... .... .. ...................... . Pitts, William T., Colorado Water Congress ........................ .. ...................... .. Prepared statement ................................................................................. .. 

Ro!?~:~~~tfc~ku.~~b~~a~!::!~t~~e~~~;~ ~:~.~~~· ... ~~~~~~~~~ .. ~~~~~ .. ~~: Prepared statement ..... ....................................................... ............. ......... . Schmitten, Rolland A., Director, National Marine Fisheries Service, 

NOAA, U.S. Department of Commerce ................................... ................... . Prepared statement ...... ... .... ................... .. .............................. .. ......... .. .... .. Sharp, Sam, Supervisor, Imperial County, CA, representing Southern 

California Association of Governments ..... ....... .......... ................................ . Prepared statement .. ........... ..................................................... ........... ..... . Stovall, John F., General Counsel, Kern County Water Agency for the 

Association of California Water Agencies .................................................. . Prepared statement ........ ... ....................................................................... . Thomas, Jack Ward, Chief, Forest Service, U.S. Department of Agriculture ........................................................................................ ..... ............. .. Prepared statement ................................................................................. .. 

Additional material supplied: 

An Analysis of the Impact of the Endangered Species Act on Texas 

Rural Land Values, by Charles E. Gilliland .......................... .................... . Bonneville Power Administration's expected annual fish and wildlife costs 

to the Federal Columbia River Power System .......................................... . Economic Well-Being and Environmental Protection in the Pacific Northwest, a Consensus Report by Pacific Northwest Economists .................. .. Federal and State Endangered Species Expenditures, compiled by U.S. 

Fish and Wildlife Service .................... .... ..... .. ............... ........ ...................... . 

(Ill) 

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IV 

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Additional material supplied-Continued 

Funding of the Endangered Species Act-Are we adequately funding 

the Act?, by Committee on Resources Majority Staff ............. ................... 192 

Myths of Jobs vs. Resources: Environmental Protections and Economic 

Growth, by California Senate Office of Research ... . .. . .. ...... .... .. ... .. . . . . .. .. .. . .. 224 

Resource Management-Authorization Language Citation .......................... 218 

The Impact of Endangered Species Listings on Home Building and the 

Real Estate Industry ......................... .. ....... ... ................ ....... ........................ 319 

Communications submitted: 

Frampton, George T., Jr. (Interior Dept.): Letter with enclosures of April 

1, 1996, to Hon. Don Young .. ............ ... ... .......... ...... .... ....... .. ..... ........ ........... 172 

Genega, Maj. Gen. Stanley G. (Army): 

Letter with enclosure of April 29, 1996, to Hon. Helen Chenoweth 189 

Letter of April 22, 1996, to Hon. Don Young ............... ........................... 187 
ENDANGERED SPECIES PROTECTION 

WEDNESDAY, APRIL 17, 1996 

HOUSE OF REPRESENTATIVES 

COMMITTEE ON RESOURCES 

Washington, DC. 

The Committee met at 11:03 a.m. in room 1324 of the Longworth 

House Office Building, the Honorable Don Young (Chairman of the 

Committee) presiding. 

OPENING STATEMENT OF THE HON. DON YOUNG, A U.S. REPRESENTATIVE FROM ALASKA; AND CHAIRMAN, COMMITTEE 

ON RESOURCES 

The CHAIRMAN. The Committee will come to order. Good morning. 

I welcome all of you to this hearing on the funding of the Endangered Species Act of 1973. The purpose of this hearing is to examine the expenditures of the agencies that participate in the effort 

to save endangered and threatened species. 

In this election year, this Congress has been accused of gutting 

programs to protect endangered and threatened species. But, the 

record clearly reflects that this Congress and the American people 

have made an enormous investment in protecting and conserving 

our wildlife resources. 

The Secretary of Interior has been telling the American people 

that this Congress only provides about $40 million each year to 

protect endangered and threatened species. Those of us who have 

been working on this issue these many years know that we have 

made a substantially higher commitment in terms of funding. 

In 1993 alone, the Federal and state governments spent more 

than $233 million to protect endangered species versus the statement of the Secretary of $40 million. There are over 20 Federal 

agencies that spend tax dollars to protect endangered and threatened species. 

Total spending for ESA by the Federal and state governments is 

expected to exceed $3.6 billion dollars for the seven year period 

from 1991 to 1997. I want to restate that-$3.6 billion dollars. Congress appropriates over $6 billion to the Department of Interior 

each year to protect our natural resources. 

Of that amount, the Fish and Wildlife Service receives $1.1 billion to protect wildlife. The Fish and Wildlife Service is required 

to report each year on actual expenditures on the Endangered Species Act. 

According to the official Fish and Wildlife Service, those reports 

substantially underestimate the actual ESA-related spending. How-

(1) 
2 

ever, the reports themselves state that spending has increased 

from $43 million in 1989 to $291 million in 1992 and $233 million 

in 1993. 

Again, I go back to the Secretary's statement of $40 million. It 

is an example of election year rhetoric. 

The actual spending is far higher than even those numbers reveal. I've asked our staff to prepare an analysis of ESA-related 

spending. And, those documents are in your folders today. 

However, again, the Secretary of Interior still poor-mouths the 

enormous investment being made by the American people in wildlife protection, giving them little or no credit for these expenditures. Frankly, I am truly sorry that the Secretary of the Interior, 

Secretary Babbitt, did not accept our invitation to appear today to 

make the argument for proper funding of the ESA, according to 

him. I understand that he is going hiking instead. 

However, I am happy to welcome Mollie Beattie back. I am 

happy to have her here today, as I wished her a moment ago full 

speed and full recovery. She wished me the same thing. We both 

are achieving those goals. 

This Committee had hoped to question the Secretary today about 

some of the public misstatements he has made. And, we have documentation of all those misstatements. 

But, we will ask Ms. Beattie some of those questions and, most 

of all, we will ask her to take those questions back to him. I will 

assure you, he will be here before this Committee next week. 

It is important that this Committee, as the authorizing Committee for the ESA, determine whether these funding levels are adequate to accomplish the goals of the ESA and whether the American people are seeing a return of this enormous investment in 

terms of recovery of listed species. Our questions today will be addressed to all witnesses before us. 

Again, Ms. Beattie, we hope in the future that Secretary Babbitt 

will work a little harder to provide honest, factual information instead of political rhetoric to the people of America. 

Are there any other opening statements? Mr. Kildee. 

Mr. KILDEE. If he wishes, I will defer to Mr. Studds. If he has 

no comment, I-Mr. Studds--· Mr. STUDDS. I think the better part of wisdom is to retain silence 

here. I'm shocked at the generosity of my friend from Alaska with 

all the money he is spending on this. I am very touched. 

The CHAIRMAN. Well, you had a lot to do to help me spend it. 

Mr. STUDDS. I know. But, I was trying to think here if I had the 

alternative of taking a hike, which--

[Laughter.] 

Mr. STUDDS. [continuing]-decision I would make. 

[Laughter.] 

Mr. STUDDS. There are hikes and there are hikes, as the gentleman knows. 

The CHAIRMAN. Well, if the gentleman would yield, there are 

many people who have told me to take a hike, too. 

[Laughter.] 
3 

STATEMENT OF THE HON. GERRY E. STUDDS, A U.S. 

REPRESENTATIVE FROM MASSACHUSETI'S 

Mr. STUDDS. The gentleman said that. I certainly did not. 

I want to join the Chairman in our warmest welcome to Mollie. 

We are delighted to have you here. We really are. 

I think you probably have a renewed feel for the importance of 

the statute in question. We all do. 

It's very nice to have you back. It really is. 

And, I'm going to-you may not believe this, Mr. Chairman, but 

I am going to refrain from saying anything that would, by the 

remotest interpretation or stretch, be considered political rhetoric. 

I think it's very kind of you to hold a hearing on the Endangered 

Species Act and-this endangered Endangered Species Act. 

And, I will keep quiet and see what they have to say. The CHAIRMAN. The gentlemal). from New Jersey. 

Mr. SAXTON. No. 

Mr. STUDDS. Actually, I think we should report the bill, looking 

around the room. 

[Laughter.] 

The CHAIRMAN. The gentleman from Michigan. 

STATEMENT OF THE HON. DALE E. KILDEE, A U.S. 

REPRESENTATIVE FROM MICHIGAN 

Mr. KILDEE. Well, needless to say, our views on the Endangered 

Species Act are not quite parallel, Mr. Chairman. And, I find it one 

of the best congressional Acts on the books and am anxious to 

make sure that it structurally is not changed in its authorization, 

that it's--every bill-no bill is written on Mt. Sinai, certainly on 

Capitol Hill. · But, I really think that the bill that was reported out, I think, 

last October from this Committee had serious deficiencies. And, I 

want to make sure that we take care of those deficiencies in any 

authorization bill and to make sure also that sufficient appropriations are made for this bill. 

Thank you, Mr. Chairman. The CHAIRMAN. I thank the gentleman. The gentleman from 

Maryland. 

STATEMENT OF THE HON. WAYNE T. GILCHREST, A U.S. 

REPRESENTATIVE FROM MARYLAND 

Mr. GILCHREST. Thank you, Mr. Chairman. Tonight, I'm going to 

a baseball game in my District. It's a brand new stadium and it's 

called the Shore Birds. And, it's a minor league team. And, my staff encourages me to do that instead of just going 

home and spending a pleasant evening with the family, I should do 

ii with the Governor, another Senator, whatever. But, they encourage me because it's part of America's best past time, America's 

greatest past time-baseball. 

Well, this brings me into a conversation about the Endangered 

Species Act. To me, America's greatest past time is hard work, knowledge and friendship. That's why we have succeeded where 

other countries have failed. 

And, in an issue such as important yet, unfortunately, as volatile, misunderstood, sometimes approached from an extremist per-
4 

spective, this issue of biological diversify for this country, in my 

judgment, must be approached with people who are interested in 

it from all perspectives with hard work, knowledge and friendship. 

And, at that point, I think we will-all of us, collectively and together, regardless of our perspective-succeed in this endeavor, because it will be useful for future generations. 

And, I applaud you, Mr. Chairman, and the former Chairman of 

this Committee, for working together for so many years to bring us 

to this point. Thank you. 

The CHAIRMAN. The gentleman from California, Mr. Pombo. 

STATEMENT OF THE HON. RICHARD W. POMBO, A U.S. 

REPRESENTATIVE FROM CALIFORNIA 

Mr. POMBO. Thank you, Mr. Chairman. I would just like to say that I look forward to this hearing. Over 

the past couple of years, we've heard a lot about funding on endangered species. I look forward to the opportunity to hear from the 

Administration witnesses and the other witnesses on exactly how 

the money is being spent, whether or not it is being done in the 

best possible manner and what direction we go from here. So, thank you very much. The CHAIRMAN. Thank you. The gentleman from Oregon, Mr. 

Cooley. 

STATEMENT OF THE HON. WES COOLEY, A U.S. 

REPRESENTATIVE FROM OREGON 

Mr. CooLEY. Thank you, Mr. Chairman. I appreciate you holding 

this hearing. I want to say that I agree with my fellow colleagues that it's important to have these hearings and see how well we are doing and 

what we can do to bring a balance into the Endangered Species Act 

before it's renewed. Thank you. 

The CHAIRMAN. Thank you. The gentleman from California, Mr. 

Dooley. 

STATEMENT OF THE HON. CALVIN M. DOOLEY, A U.S. 

REPRESENTATIVE FROM CALIFORNIA 

Mr. DOOLEY. Thank you, Mr. Chairman. I appreciate you holding 

this hearing. 

I look forward to the testimony of the Administration witnesses 

but also of the second panel, which will include some folks from 

local agencies and also from the private sector, because we spend 

a lot of time focusing on the governmental cost of ESA. But, oftentimes I think we are overlooking where the direct impacts of the 

ESA lie in terms of the cost to our private sector as well as to our 

local communities. And, while Secretary Babbitt has made statements in the past 

that it's only costing Americans 16 cents per person to implement 

the ESA to achieve its objectives, I guess one of the things that I'm 

most interested in is if this is an Act that we are trying to meet 

some societal objectives, regardless if it's 16 cents or $5 a person, as policymakers we have to be concerned with how we allocate 

those costs among all people. And, hopefully with a reform that will 
5 

ultimately be enacted through this body, we will ensure that we 

are not burdening a select few with the cost of implementing the 

ESA. 

And, I thank you for having this hearing. 

The CHAIRMAN. I thank the gentleman. The gentleman from 

Michigan, I would just like to remind this hearing is on statements 

made by the Secretary of Interior prtmarily that have been absolutely untrue and outright lies. 

And, I just want to make sure that everybody knows how much 

money is being spent by the agencies themselves. And, this is what 

we are trying to find out, why these statements are being made, are they just political intent, are they outright----is he knowledgeable or is he unknowledgeable about this issue. 

And, that reminds me, I usually swear in the Administration witnesses. I look at this table and I see most of you I've dealt with 

before. I don't think there is any need of that. 

But, I'm going to suggest one thing. If I find, in fact, any of your 

testimony is not true, the next time you will be before this Committee very quickly you will be sworn in. 

The first witness is the Honorable Mollie Beattie, Director of the 

Fish and Wildlife Service, U.S. Department of the Interior. And, 

she is appearing on behalf, unfortunately, of the hiking Bruce Babbitt. 

Madam Secretary, you are up. 

STATEMENT OF MOLLIE BEATTIE, DIRECTOR, U.S. FISH AND 

WILDLIFE SERVICE, DEPARTMENT OF THE INTERIOR 

Ms. BEATTIE. Thank you, Mr. Chairman. And, thank you for your 

warm welcome back. 

It is, indeed, a pleasure to be here, especially when I consider 

that the alternative is the neurological unit at Johns Hopkins Hospital. So, I'm very glad to be here today. 

The Department of Interior, Mr. Chairman, has worked tirelessly 

over the last three years to improve the effectiveness of the Endangered Species Act and to identify and resolve problems with its im- plementation and administration. We have taken dramatic steps to 

implement and administer the ESA in a manner that conserves 

species, recognizes the needs of private landowners and achieves 

these benefits in the most cost effective manner. 

We have searched the attic, closets and basement of the Endangered Species Act and found many under-used authorities that 

have allowed us to resolve or avoid conflicts between species, conservation and other equally important needs of our society. We 

have used them successfully to resolve a set of past problems which 

we agree deserve attention. 

We are, however, discouraged that these concerted and successful 

efforts seem not to be reflected in continued attacks from some 

Members of this Congress which do not reflect this progress nor are 

reflected in this Committee's legislative proposal, H.R. 2275, which 

would effectively repeal the Act. We, therefore, have begun to wonder whether some congressional criticism of the Act is meant to be 

constructive or whether it is really an ideological attack on the fundamental premiss, which is strongly supported by the American 

people; and, that is that the conservation of species and ecosystems 
6 

is an ethical imperative, a critical element of a desirable future for 

people and the planet and an economic necessity. 

In support of this last point that the conservation of biodiversity 

is both economically feasible and necessary, I would ask to have introduced in the record three recent reports-"The Impact of Endangered Species Listings on Home Building and the Real Estate Industry;" a summary, "The Myths of Jobs vs. Resources: Environmental Protections and Economic Growth," from the California 

Senate Office of Research; and "Economic Well-Being and Environmental Protection in the Pacific Northwest, A Consensus Report by 

Pacific Northwest Economists." 

Let me illustrate the mixed message we feel we are getting from 

this Congress. Over a year ago, working with a variety of interests, 

including the Western Governors' Association, we developed a 10 

point plan for responding to a set of problems which we agreed 

were in need of attention, as I said. 

For example, in the past, the Endangered Species Act did not do 

enough to prevent endangerment, which is a much easier and 

much less costly challenge than reversing it. We agree that historically this was one of the Act's major shortcomings. 

So, for three years, we have put a great deal of time and resources into keeping so-called candidate species from approaching 

the endangered species list. Between July of 1994 and July of 1995, 

at least 15 candidate conservation agreements have been made 

with various cooperators, at least 20 more in progress. We are emphasizing working with partners to identify candidate 

species and to plan candidate conservation. By being anticipatory 

and cooperative, we believe, and we know, we can preclude the listing of many species. 

However, just as we begin to count successes in these efforts, this 

Congress has sev-erely curtailed the funds available for them, providing only $2.7 million reduced by more than one-third from 1995. 

In the 1996 appropriations bill originally passed by the House, no 

money was provided for candidate conservation. 

For our own and our sister departments, the funds for these discretionary, preventative measures, as opposed to mandated regulatory actions, will necessarily be first to be cut in the current 

round of budget reductions. We are perplexed by a mixed message 

that at once asks us to amend the problem and then withholds the 

means to do so. 

The message regarding the importance and economy of prevention rather than cure has been further muddied by the congressionally-mandated moratorium on the listing of species. One hundred 

eighty-two candidate species and 243 species already proposed for 

listing are caught in limbo under the moratorium. 

It is likely that without attention or protection, they will continue to decline. At the same time that Congress expresses concern 

about the cost-effectiveness of the Act, it seems to be making sure 

that the Act will take significantly more time and money and effort 

to recover these species when authority and funding are restored. 

The moratorium means less flexibility and certainty that we are 

able to provide to those affected and assures increased cost and 

chaos. We will sutTer. 
7 

A second historical problem of the ESA was its failure to provide 

certainty and incentives to private landowners. Although we've 

made great progress in investigating and providing incentives to 

landowners for habitat conservation as well as in removing doubt 

and uncertainty about their responsibilities under the Act, Congress has severely confined our continued efforts in this direction. 

Regarding the issue of certainty for landowners, we have required, since July of 1994, that all final listing rules include specific language defining actions to be considered as illegal take of a 

species. For example, when a freshwater mussel was recently listed, the Fish and Wildlife Service announced that farming and mining in North Carolina and Tennessee would not violate the ESA. 

With the moratorium, the Congress has left landowners and species in limbo relative to allowable activities should the species be 

listed. At present, we can neither work to prevent the listing nor 

provide information about what would be required if we cannot 

prevent the listing. 

Third, and finally, an example of our success in overcoming past 

problems is an expanding role of the states and tribes. In July of 

1994, wejublished a very comprehensive policy that outlined how 

states an tribes would be involved with all steps and phases of the 

Endangered Species Act implementation. 

In 1996, we asked for $27 million to assist with this effort. The 

Congress' funding proposal is for $8 million. 

We have, and continue to make, improvements if you will let 

us-and can continue to make improvements if you will let us, Mr. Chairman. If not, the legacy of the 104th Congress may be the destruction of one of our nation's most important and precious environmental laws and the impoverishment of our natural heritage. 

Thank you, Mr. Chairman. [Statement of Ms. Beattie may be found at end of hearing.] 

The CHAIRMAN. I thank you, Madam Secretary. The next witness 

is the Honorable Sherri Goodman, Deputy Under Secretary of Defense for Environmental Security, U.S. Department of Defense. 

Ms. Goodman. 

STATEMENT OF SHERRI W. GOODMAN, DEPUTY UNDER SECRETARY OF DEFENSE FOR ENVIRONMENTAl, SECURITY, U.S. 

DEPARTMENT OF DEFENSE 

Ms. GOODMAN. Thank you, Mr. Chairman and members of the 

Committee. I would ask that my testimony be submitted in the 

record in full. I will summarize it for you. 

I am pleased to be here today. As you may know, the Department of Defense is steward for over 25 million acres of land in the 

United States. This land is necessary to support the testing of 

weapon systems and the training of people so that our armed forces 

are equipped and ready to face any military challenge. To have the ability to deploy and fight successfully anywhere in 

the world, our armed forces must train in a wide variety of climatic 

and terrain conditions. Accordingly, training areas are located 

throughout the United States in grasslands, in deserts, coastal 

areas, forests and tundra. 

Our training lands are rich in natural resources and are often in 

pristine condition because they have been spared commercial and 
8 

other types of development. In some instances, these areas are the 

last remaining strongholds of species that have suffered from habitat destruction and other degradation. 

Over 400 species that are considered threatened or endangered 

can be found on lands managed by the Department of Defense. 

Today, I would like briefly to describe how the Department manages and maintains its testing and training lands to support the 

military mission, our primary purpose, while at the same time protecting endangered species found on these lands. 

Our military activities are planned to ensure the highest possible 

degree of safety. For example, buffer or safety zones are established 

around artillery or aerial bombing impact areas. 

These buffer zones, in which no activities are usually permitted, 

also benefit wildlife and particularly endangered and threatened 

species. For example, the protected red-cockaded woodpecker 

thrives in the buffer zones of Eglin Air Force Base, Florida, and of 

many other military installations in the southeastern United 

States. 

Each year, we put a considerable amount of effort into monitoring the migratory patterns and nesting habits of birds, including 

those which are listed as threatened and endangered. Why? 

This information is invaluable to our military planners, since it 

assists them in selecting low level flight training routes with reduced potential for bird strikes and the resultant loss of air crews 

and aircraft. One of the first things our military planners did when 

they went to plan for Desert Storm in Southwest Asia was to understand the migratory patterns of birds. 

This behavioral information also assists in selecting ground 

maintenance procedures around runways which discourage the 

nesting of birds in inappropriate locations. For example-and, as 

you will recall, Mr. Chairman-the Air Force's Bird Aircraft Strike 

Hazard Program is aimed at minimizing collisions between military 

aircraft and birds. This information is vital. 

In September 1995, an AWACS aircraft departing Elmendorf Air 

Force Base in Alaska struck a flock of Canada geese. The aircraft 

crashed and all 24 crew members were killed. 

As a result of this accident, the Air Force has improved its preparations for the bird migration season and developed a more aggressive program to detect and deter geese from runways around 

our military installation. This program has also had the effect of 

reducing adverse effects on bird populations. 

Also, in the interest of safety, the Department conducts controlled burns. These burns destroy unwanted underbrush, recycle 

nutrients and promote healthy, natural habitats. These can be vital 

to the survival of some threatened and endangered species. 

The Department must manage land in a manner that can support sustained training activity. This is an important consideration 

for the Army, whose training needs, especially for heavy armor are 

particularly hard on the natural terrain. 

However, if training and associated land maintenance are not 

carefully planned and managed, the land would soon deteriorate, 

becoming incapable of providing realistic training. So, our second 

goal, in addition to safety, is providing realistic training for our 

troops. 
9 

The Army, recognizing this requirement, has implemented a land 

management program called Integrated Training Area Management or ITAM at some 60 of our Army installations. ITAM balances the needs of training with the ability of the soils and vegetation to recover. 

Many actions taken to ensure a realistic training environment 

also benefit vegetation and wildlife. In recent years, the Department has been taking new management approaches that increase the flexibility to use land inhabited 

by threatened or endangered species. One approach to manage natural resources is to treat them as part of an ecosystem. 

Land management plans and species recovery plans are developed based on a full understanding of resources and habitat 

throughout the region. The plans balance the responsibility for supporting protected species among all major Federal landowners. 

In addition, the plans ensure future development does not interfere with mission capabilities and is compatible with measures to 

support and protect endangered or threatened species. This approach to land management is being used in the Mojave Desert 

where five extremely important training, testing and logistics installations are located. The Mojave Desert is where our troops 

trained for Desert Storm. 

DOD is working closely with other Federal agencies, including 

the Department of Interior and with the State of California, to develop a data base that will ultimately support the development of 

a desert-wide management plan. In some instances, DOD, in order 

to increase its operational flexibility-and this is our third conservation goal-has taken action to help a species thrive. 

These actions, while modest in cost, have been extremely effective. For example, efforts by the Marines to increase the number 

of mating pairs of the endangered Least Bell's vireo at Camp 

Pendelton in California have been so successful that the Fish and 

Wildlife Service has determined that the establishment of a critical 

habitat area there is no longer necessary. In addition, the Marines 

now have greater flexibility in their use of these sensitive lands, 

such as riverbeds, since the Service has determined that, given the 

size of this vireo population, a few inadvertent takings would be acceptable. 

There is a similar success story at Fort Irwin, home of the 

Army's National Training Center in the Mojave and of the desert 

tortoise. This tortoise is extremely vulnerable to predators in its in- fancy. 

Accordingly, the Anny, at modest cost, is raising tortoises in a 

protected area until their shells are hard enough to provide protec- tion against predators. Each year, the Army releases more mature 

tortoises than are killed by its training activities, thereby providing 

a net benefit to this endangered species at minimal cost. 

The CHAIRMAN. Ms. Goodman, how much more do you have? 

Ms. GOODMAN. I have just a very little bit more, Mr. Chairman. The CHAIRMAN. OK. 

Ms. GOODMAN. The Department makes investments each year 

that ensure that the military mission can be performed with limited or no impact on threatened or endangered species. In some in-
10 

stances, there have been actual benefits to the Department for protecting endangered species. 

Recently, the Navy installed propeller guards on its tugs at the 

Naval Submarine Base, Kings Bay, Georgia, to protect the manatee. The Navy soon discovered that these guards are effective not 

only in protecting the manatee, but the guards also increased the 

operating efficiency of the tugs. 

In summary, the Department has been able to meet the provisions of the Endangered Species Act, while at the same time conducting necessary training and testing to ensure that we are able 

to meet any military challenge. We've been able to effectively meet 

our stewardship responsibilities to protect these endangered species without adversely affecting the military mission. 

It has not hurt our military readiness. Our challenge is to continue to protect threatened and endangered species on military installations while we conduct increasingly realistic military training 

and maintain our military readiness. 

DOD has risen to this challenge by managing its 25 million acres 

of land through a comprehensive integrated stewardship program 

that ensures our activities do no harm to threatened or endangered 

species. The proof of our success can be seen not only by the thriving populations on military installations but also by the high state 

of the readiness of today's military forces. 

Thank you, Mr. Chairman. 

[Statement of Ms. Goodman may be found at end of hearing.] 

The CHAIRMAN. Thank you, Ms. Goodman. The next witness is 

Major General Stanley G. Genega, Director of Civil Works, U.S. 

Corps of Engineers, Department of the Army. 

Major. 

STATEMENT OF MAJOR GENERAL STANLEY G. GENEGA, 

DIRECTOR OF CIVIL WORKS, U.S. ARMY CORPS OF ENGINEERS 

Maj.Gen. GENEGA. Thank you, Mr. Chairman. It's a pleasure to 

be here and have the opportunity today to describe for you the expenditures and activities of the U.S. Army Corps of Engineers to 

conserve the endangered and threatened species in connection with 

our Civil Works activities. 

The Corps began to track its national expenditures for implementing the Endangered Species Act in response to the 1988 

amendments to the Act. I will summarize our responsibilities, expenditures to date and then provide an example that demonstrates 

our commitment to the effective implementation of the Act. 

The Army, through the Corps Civil Works Program, has planned, 

developed and currently maintains some 12,000 miles of waterways, has constructed 8,500 miles of flood control levees and 383 

reservoirs and has constructed and operates 75 hydroelectric power 

facilities. The Corps has stewardship responsibilities for nearly 12 

million acres of land and water at over 460 projects nationwide. 

The annual Corps response to the Department of the Interior has 

been standardized to include expenditures in the following categories: all costs related to consultation under Section 7 of the Act; 

all costs for Corps involvement in recovery teams and recovery 

plans; all costs associated with incidental take provisions issued 

with the Act's biological opinions; all costs incurred for studies, re-
11 

search, observers and monitoring required by the Act; and, finally, 

all costs for mitigation. 

In the first year of detailed accounting, Fiscal Year 1989, the 

Corps expended slightly more than $4 million for activities related 

to the Act. Since then, the Corps can demonstrate a continuing and 

increasing level of expenditure to ensure compliance. My detailed statement has great detail on all of those expenditures. 

To summarize, in Fiscal 1990 and 1991, our expenditures were 

in the range of $7 million to $8 million. From 1992 to 1994, the 

expenditures were in the range of $30 million to $50 million. 

And, in Fiscal 1995, the Corps spent approximately $95 million 

implementing the Endangered Species Act. We estimate in Fiscal 

Years 1996 and 1997 expenditures of $120 million and $145 million, respectively. 

Since Fiscal Year 1992, approximately 75 percent of the annual 

expenditures for compliance with the Act have been for salmon recovery efforts in the northwest. The remaining 25 percent is across 

all the other activities. 

I would now like to highlight a Corps activity, the maintenance 

of the Federal coastal navigation system in the southeastern United States, that demonstrates our commitment to effective implementation of the Act. A 1990 study by the National Academy of 

Sciences estimated that our hopper dredges were killing as many 

as 500 loggerhead sea turtles and up to 50 Kemp's ridley sea turtles annually. 

The Corps South Atlantic Division restricted hopper dredging in 

those navigation channels to the period of December through 

March. We began an intensive research effort to develop new technologies to protect sea turtles and to determine the seasonal distribution of sea turtles. 

Through our research efforts, we have developed a hopper dredge 

draghead designed to deflect the sea turtles while not affecting the 

dredging production rates. Our damage to turtles has reduced dramatically to single figures in a given season. 

Another endangered species, the right whale, was found to be at 

potential risk during that window which was designed to protect 

the sea turtles. The offshore areas of northern Florida and southern Georgia are the only known calving areas for the right whale 

in the entire north Atlantic. To protect these whales, we conduct observation flights over the 

waters. And, when right whales are sighted, dredge operators are 

instructed to slow down. Not a single right whale has been imperiled in well over 1,000 trips to the deposition areas for the dredge 

materials. 

In conclusion, Mr. Chairman, the Corps has been making diligent 

efforts, utilizing state-of-the-art equipment and technologies, to efficiently and effectively understand, protect and restore endangered 

species and the communities and ecosystems to which they belong. 

That concludes my statement, sir. I would be happy to answer 

your questions. 

[Statement of Major General Genega may be found at end of 

hearing.] 
12 

The CHAIRMAN. Thank you, Major General. Excuse me. I saw the 

first word "Major," Major General. 

The next witness is Rolland Schmitten, Director of the National 

Marine Fisheries Service, U.S. Department of Commerce. 

Rolli e. 

STATEMENT OF ROLLAND A. SCHMITTEN, DIRECTOR, NATIONAL MARINE FISHERIES SERVICE, NATIONAL OCEANIC 

AND ATMOSPHERIC ADMINISTRATION, U.S. DEPARTMENT 

OF COMMERCE 

Mr. SCHMITTEN. Good morning, Mr. Chairman, and members of 

the Resource Committee. I very much appreciate this opportunity 

to review the implementation and administration of the Endangered Species Act by my agency, with a particular focus on the cost 

to administer the Act and our efforts to prevent species from being 

listed. I've submitted my written testimony, and I will just summarize some of the key aspects from that testimony. 

The Endangered Species Act is one of the main reasons that I 

came to Washington, D.C. Not only do I support the Act, but I support the necessary changes to the Act that will make it more efficient. 

I believe as strongly today as when I left the other Washington 

that Americans value their environment. In particular, they want 

clean air and water and places relatively untouched by humans. 

And, certainly, they value the wild species that reside there. A lot 

of Americans and American businesses equate a healthy environment with a healthy lifestyle with a healthy economy. 

Poll after poll continue to show that not only do Americans desire 

a healthy environment and associated wild species but are willing 

to pay for that privilege. There are many legislative tools that provide the American public with a clean environment, but only one 

primary tool that gives protection to wild species. And that is the 

Endangered Species Act. 

It has been often described as the single most significant law to 

protect species in the world. However, like much other legislation 

more than 20 years old, the Act is long overdue for changes that 

not only will help restore and preserve species but will make it 

more efficient too. 

The most significant improvement to the Endangered Species Act 

will be that it becomes more proactive in protecting species before 

they become threatened or endangered so as to avoid listings rather than ambulance chasing after species whose very low populations require them to be listed as threatened or endangered 

under the ESA. The wait for listing not only drives up costs but 

more often lengthens the period of recovery. 

Last March, the Department of Interior and the Department of 

Commerce, jointly, offered a 10 point plan outlining administrative 

steps to improve the management of the Act. I think key among 

those steps are the following three: one, allowing the public, especially our states, a bigger role in the process; second, providing certainty, at least predictability, to private landowners who encounter 

endangered species on their land; and, third, requiring peer reviewed science for decisionmaking. 
13 

One of the more important proactive tools to avoid listing is the 

Habitat Conservation Plan, the HCP. This is a tool which, in conjunction with Fish and Wildlife, we are initiating in many parts of 

the U.S. in partnership with the private sector to protect species. 

The HCP gives the private sector the certainty it needs to make 

business decisions for the future. It also gives the agency the assurance that, in a watershed or an ecosystem basis, species are protected. I view this as a win/win approach, where previously gridlock and 

lawsuits have surrounded our listed species. To illustrate the magnitude of our involvement with HCPs, we currently have 29 listed 

species the agency manages. We are involved in 35 proposed HCPs, 

representing nearly 6 million acres around the United States. 

Just a brief comment on costs to maintain listed species. It's extremely difficult to put a price on the environment or wild species. 

The Act does not engage in establishing the value or the worth of 

threatened or endangered species but simply directs what actions 

are to be taken to list and recover species. In fact, costs are only 

mentioned in two places in the Act. Both of those are in Section 

4, the Creation of Critical Habitat and in recovery plans, where we 

are to estimate both the time--

The CHAIRMAN. Rollie, let me interrupt you. This hearing is on 

your cost and what it is costing you and where you are spending 

the money. 

I don't need to have the philosophy of this Administration. I 

want to get to the roots of where the Secretary has been saying it 

only costs $40 million. 

I have already heard each one of you say it has been costingin fact, I've got the record here. The Corps of Engineers, this last 

year, $94 million. The Department of Defense, $19 million. 

If I can get down to where you are, Rollie, it's a considerable 

amount of money. The National Marine Fisheries Service, $21 million. 

So, let's talk about where we are spending the money and how 

you are spending the money and if, in fact, you are being shortchanged. I don't want to hear the philosophies. 

Mr. SCHMITTEN. Mr. Chairman, my very next sentence was going 

toThe CHAIRMAN. Well, I'm waiting for those sentences. 

Mr. SCHMITTEN. 1996, our cost was $21.2 million. In 1997, our 

cost is $23.5, of which nearly half of that is for northwest salmon. 

I would note that in managing costs, it's important that we take 

the most cost-effective approach in utilizing the public dollars and 

also that we--I think, as Mr. Dooley commented-that we spread 

the cost of recovery equitably among constituents, so no one sector 

bears a disproportionate burden of the recovery. 

Those are just a few examples of our administration of the ESA. 

We are constantly aware of costs associated with the management 

of the ESA. And, we continue to examine and reexamine how to be 

a more effective manager. Mr. Chairman, I do appreciate the opportunity to be here. 

[Statement of Mr. Schmitten may be found at end of hearing.] 

The CHAIRMAN. Thank you, Rollie. The next witness is Jack 

Ward Thomas, Chief of U.S. Forest Service. 
14 

Jack. 

STATEMENT OF JACK WARD THOMAS, CHIEF, FOREST 

SERVICE, U.S. DEPARTMENT OF AGRICULTURE 

Mr. THOMAS. Good morning, sir. I will be as brief as possible and 

maybe we can publish the whole thing in the record. 

Our threatened and endangered species program exists to assure 

protection and conservation of species and the ecosystems on which 

they depend while providing and contributing to the sustenance of 

other uses, such as forage for livestock, trees for wood products, 

recreation opportunities, including hunting and fishing, wilderness 

and bountiful clean water for on-forest and downstream use. To 

this end, consideration for threatened, endangered and sensitive 

species is interwoven in all of our activities. 

We have four major administrative operations in the Forest Service-the National Forest System, Research, State and Private Forestry and International Forestry. Each one of those areas has responsibilities in implementing ESA. 

In order to meet the diversity goal in the regulations pursuant 

to the National Forest Management Act, to that end, we have both 

a threatened and endangered species program, pursuant to ESA, 

and a sensitive species program, pursuant to the National Forest 

Management Act. We don't track these programs separately. We 

track them as a single entity since many of the protection and mitigation measures, habitat restoration and enhancement projects and 

research and inventory work overlap. 

Some portion of every program in the Forest Service is related 

to protecting species diversity while providing human benefits. 

Therefore, the costs reported today for the threatened, endangered 

and sensitive program does not include all expenditures for maintaining these species under such programs as range, fire and forest 

pest management. 

In addition, because of the integrated nature of our work, there 

is a budget line item for ecosystem planning, inventory and monitoring, which also includes some expenditures that benefit threatened and endangered species. 

Our goal is to implement and administer the threatened, endangered. and sensitive species program in an effective and efficient 

manner. 

Section 7 consultations have been streamlined dramatically cooperatively with the Fish and Wildlife Service, the National Marine 

Fisheries Service, the Bureau of Land Management and the EPA. 

Early involvement of these agencies in the planning phase of development have led to much shortened timeframes for consultation 

with significant savings. 

Nationwide, in terms of Forest Service operations, I know of no 

backlog in consultation, which is a dramatic improvement in efficiency over the last 18 months. 

In FY-1995, $20.5 million were expended to manage threatened 

and endangered species out of a total appropriation of $23.6 million, which included the sensitive species protection. An additional 

$11.5 million was spent to protect sensitive species which came 

from other programs as needed to implement forest management 

activity. 
15 

Research costs for threatened, endangered and sensitive species 

were $9.6 million. The specific budget line item for threatened, endangered and sensitive species comprises less than 5 percent of the 

Forest Service 1995 budget. 

However, all directly attributable costs of about $44.7 million out 

of a total of $3.06 billion are about 11 percent of the Forest Service 

budget total. 

I would make the point in closing that about one-third of all the 

species currently listed occur on national forest and grasslands. 

Now, I expect as human population pressure and development increase, the Federal lands will become increasingly important to the 

survival of those species. 

We are moving toward an ecosystem approach to management in 

order to better simultaneously meet the objectives set forth in the 

laws that direct our action. And, I would point out that if you look 

at the confluence of all of those laws, we will probably be in approximately the same place as we would with or without the Endangered Species Act. 

We hope by maintaining and restoring ecosystems that the productivity of the land will not be impaired and those systems upon 

which plant and animals and human beings depend will remain 

functional. This is where the multiple benefits come from over 

time. 

Without those natural functioning systems, those benefits are at 

extreme risk. I feel that investments made today provide long:term 

benefits and will cost less in the long run. 

And, I would be happy to answer your questions. } 

[Statement of Mr. Thomas may be found at end of hearing.] 

The CHAIRMAN. Thank you, Jack. The next witness is Jack Robertson, Deputy Administrator, Bonneville Power Administration, U. 

S. Department of Energy. 

STATEMENT OF JACK ROBERTSON, DEPUTY CHIEF EXECUTIVE OFFICER, BONNEVILLE POWER ADMINISTRATION, U.S. 

DEPARTMENT OF ENERGY 

Mr. RoBERTSON. Thank you, Mr. Chairman. In the interest of 

time, I am going to try to boil down my testimony and ask that the 

whole testimony be submitted for the record. 

Again, my name is Jack Robertson, Deputy CEO of Bonneville. 

Bonneville was created to market power from the Federal hydroelectric resources in the Columbia River Basin. Bonneville's operations are completely funded by revenues and sale of energy and 

transmission services. 

Under the 1974 Federal Columbia River Transmission System 

Act, Bonneville deposits revenues from energy and transmission 

sales into the Bonneville Fund at the U.S. Treasury and is responsible for repaying the Federal investment in the northwest hydro 

system with these revenues. Bonneville does not receive annual Federal appropriations. The 

Federal investment, which Bonneville is responsible for repaying, 

does include investments made by other Federal agencies such as 

the Corps, the Bureau, the U.S. Fish and Wildlife Service in hydroelectric facilities including measures designed to mitigate for Federal hydroelectric development damage to fishery resources. 
16 

In 1980, the Northwest Electric Power and Planning Conservation Act was signed into law. That law, as well as other statutory 

directives, requires that Bonneville provide mitigation to fish and 

wildlife resources damaged as a result of Federal hydroelectric development within the Columbia Basin. 

The Act also establishes the Northwest Power Planning Council, 

two representatives for the governors of each of the four northwest 

states-Oregon, Washington, Idaho and Montana. The Council is 

entrusted with the responsibility of developing a fish and wildlife 

program that protects and enhances fish and wildlife in the Columbia Basin. 

The Region's 13 tribes believe the program helps fulfill U.S. treaty and trust responsibilities. Bonneville is required to act consistent with the program developed by the Council. 

The Council has adopted a series of fish and wildlife programs, 

the most recent of which was adopted in December 1994. Consequently, Bonneville has fish and wildlife mitigation responsibilities that extend beyond those required under the Endangered Spe- cies Act. 

Prior to 1990, the Council program included significant measures 

designed to improve the health of salmon as well as other fish and 

wildlife. Despite these actions, particular salmon stocks continued 

to decline. 

In 1990, the first petition for listing of a Columbia Basin salmon 

stock was received by the National Marine Fisheries Service. By 

1993, NMFS had decided to list three Columbia salmon stocks as 

threatened or endangered-Snake River sockeye, Snake River 

spring/summer chinook and Snake River fall chinook. 

In addition, in 1994, the U.S. Fish and Wildlife Service listed the 

Kootenai River white sturgeon as an endangered species. During 

the petition process and following the listing decisions, the Council 

developed new fish and wildlife programs that incorporated additional measures for salmon and sturgeon recovery. 

Starting in 1993, NMFS issued the first of several biological 

opinions identifying measures that are necessary to avoid threats 

to the continued existence of the species. There is significant overlap in the measures called for in the NMFS biological opinions and 

the Council program. Since 1991, Bonneville's fish and wildlife expenditures-getting 

to your point, Mr. Chairman-have increased dramatically. These 

increases, along with dramatically decreasing prices from alternative electric power suppliers in 1994 and 1995, led Bonneville 

customers to consider buying electric power from entities other 

than Bonneville. 

In order to help assure a healthy Bonneville and a recovery of 

dwindling salmon runs in the northwest, Administration officials 

developed a plan for identifying the actions necessary for the fishers while limiting the exposure of BPA ratepayers to increasing 

fish and wildlife costs. Those discussions resulted in an October 

1995 letter from the Office of Management and Budget Director, Alice Rivlin, to Senator Mark Hatfield that established expected 

BPA funding levels for all its fish and wildlife mitigation responsibilities and fallback mechanisms should the court orders lead to 

additional costs for Bonneville. 
17 

Under the agreement, Bonneville will, over the next six years, 

provide an average of approximately $250 million per year in direct 

expenditures and will incur an average of approximately $183 million annually in power costs and foregone revenues. These annual 

power costs and foregone revenues could range from approximately 

$90 million to $280 million, depending on weather and water conditions and the prices of alternative electric power supplies. 

The Administration believes that with these funds, one, adequate 

measures will be taken to protect ESA-listed salmon and sturgeon 

stocks in the Columbia Basin; two, the hydroelectric operations 

prescribed in the NMFS and U.S. Fish and Wildlife opinions will 

be met; and, three, the implementation of the Council plan will 

proceed unimpeded; and, four, Bonneville will be able to continue 

to repay the Treasury, which was about $1 billion last year alone, 

for Federal appropriations provided to other Federal agencies for 

fishery activities that mitigate damage caused by Federal hydroelectric facilities. 

BPA's submittal to you of March 14th identifies estimated costs 

incurred by BPA that are required by ESA. In addition, in an attachment, it identifies the total expenditures Bonneville is making 

for fish and wildlife activities under its statutory obligations. 

These total costs, estimated to average $435 million over the six 

years, Fiscal Year 1996 through Fiscal Year 2001, are based on the 

Rivlin to Hatfield letter mentioned earlier and are consistent with 

the estimates provided to you by the power Council. There are essentially three types of fish and wildlife mitigation actions that create costs for Bonneville. These are, one, operational changes to the hydro system designed 

to increase river velocity or improve dam passage; two, direct expenditures by Bonneville for measures such as fish hatcheries; and, 

three, expenditures made by other Federal agencies for which Bonneville has the responsibility to repay. 

It's important to note that in the absence of ESA, Mr. Chairman, 

many of the costs identified by Bonneville as required by ESA 

might still be undertaken as a result of Bonneville's obligations 

under the Northwest Power Act or other statutes. So, in conclusion, I would just say that Bonneville recognizes 

there are other variables involved in mitigation recovery, such as 

harvest, habitat and hatcheries. Others, such as fishermen, are 

paying in terms of reduced catches. However, Bonneville believes the costs of fish and wildlife mitigation for the Federal hydroelectric system are appropriately borne 

by the beneficiaries of that system. 

The Administration is proud to have reached an agreement 

which should provide adequate funding to mitigate for damage 

done by Federal hydroelectric facilities to the Columbia River fish 

and wildlife resource, including threatened and endangered species 

within the system, while also limiting the exposure for northwest 

ratepayers. 

And, with that, Mr. Chairman, I conclude my testimony. 

[Statement of Mr. Robertson may be found at end of hearing.] 

The CHAIRMAN. Thank you, Mr. Robertson. I am going right 

down the line. 
18 

Ms. Beattie, what is your-what's the President's request for endangered species money for Fish and Wildlife this year? 

Ms. BEATTIE. Mr. Chairman, I believe it's $83 million. 

The CHAIRMAN. Eighty-three million. What is the request from 

the Defense Department? 

Ms. GoODMAN. Mr. Chairman, the Department of Defense does 

not make a specific request for work to protect endangered and 

threatened species. 

The CHAIRMAN. But, you spent $21 million last year or a little 

over--

Ms. GoODMAN. In Fiscal Year 1995, we estimate we invested approximately $19.5 million to protect threatened and endangered 

species. That is--

The CHAIRMAN. What is your estimate--

Ms. GooDMAN. That is less than .1--

The CHAIRMAN. I am asking what is your estimate for this year? 

Ms. GoODMAN. I don't yet have an estimate. 

The CHAIRMAN. Well, you spent $19 million last year. Are you 

going to spend more this year or less? 

Ms. GOODMAN. I would think it would be approximately the 

same, if not a little bit less. 

The CHAIRMA."l'. We will put down $21 million. OK. Major General? 

Maj.Gen. GENEGA. Sir, we expect about $120 million. 

The CHAIRMAN. One hundred twenty million dollars. Rollie? 

Mr. SCHMITTEN. Twenty-three point five million. 

The CHAIR.M.AN. Twenty-three point five million. Jack? 

Mr. THOM.ei.S. It's $22 million, Mr. Chairman, directly. But, as I point~d out earlier, it will probably, by the time we add research 

and ~ther items in, the direct line item for it is about $22. It's 

dowrra bit. 

But, in total, I would suspect about $40. 

The CHAIRMAN. Forty. And, Jack? 

Mr. ROBERTSON. Mr. Chairman, as you know, it's difficult to pull 

the ESA costs out of our overall $435 million program that includes 

costs associated with the Northwest Power Planning Act as well. 

But, when we estimated this for the Committee, we thought it 

would be, as best we could determine, about $265 million in fiscal 

year 1996. The CHAIRMAN. Two hundred sixty-five million. 

Mr. DEFAZIO. Mr. Chairman, before you add it up, could you 

yield, because I think there will be a problem with the math? I 

think this is an important point. And, I'm not trying to be mischievous here. 

The CHAIRMAN. Pardon? 

Mr. DEFAZIO. Could you yield for a moment, because I think 

that--

The CHAIRMAN. Ms. Beattie has-she didn't bring in the BLM, 

the Bureau of Reclamations to that. You have that, too, don't you? 

Ms. BEATTIE. Mr. Chairman, forgive me. I gave you a Fish and 

Wildlife Service number and you were asking a departmental question. 

The CHAIRMA."l'. Departmental number, because this is what the 

Secretary keeps referring to as $40 million a year. 
19 

Ms. BEATTIE. Great. If you can just hang on for one minute, we 

will make an addition here. 

The CHAIRMAN. OK. Peter. 

Mr. DEFAZIO. Thank you, Mr. Chairman. Mr. Chairman, I would 

just like to point out-and perhaps the panel could clarify herethe Corps is reporting a number, but in their own testimony they 

say that 73 percent of the number that is related to northwest 

salmon is being reimbursed by BPA users who are reporting a 

number at the far end of the table. 

So, part of the number being reported by the Corps is being paid 

by BPA power users. And, I don't know how many of the other 

numbers across there might also-what other agencies might receive some reimbursement from BP A. 

So, I want to make sure we don't get any double counting here, 

because we are paying our share in the northwest. 

The CHAIRMAN. Yes. I am hoping that will be clarified. I don't 

think there will be double counting in there. 

The two of you can talk to that. Is there double counting there? 

Maj.Gen. GENEGA. Sir, I will have to check those exact numbers. 

I believe I may show a portion of my dollars-a portion are directed--

The CHAIRMAN. OK. I want the exact figures, because again I 

want to stress the purpose of this hearing is the outright lies of the 

Secretary saying we are only spending $40 million a year on the 

Endangered Species Act. 

And, if I total this up, it's about $645 million this year. And, the 

estimates, if I'm not mistaken, at the end of three years it will beexcuse me, by 1997, it will be $3.622 billion. 

And, I want to stress this, that this is the type of information 

that we are trying to achieve from each agency, what this Act is 

actually costing. We are not arguing whether it's beneficial or not. 

We are not arguing whether it's the right thing to do or not. 

What we are arguing is we do not like, and I do not like, as 

Chairman of this Committee, to have an Administration of this caliber lying to the general public. And, he's lying, lying, lying. 

And, he will be here next week. And, he will be under oath. And, 

he better have the answers 

I'm not finished yet. 

Ms. BEATTIE. Mr. Chairman, can I give you--

The CHAIRMAN. Yes, go ahead, ma'am. 

Ms. BEATTIE. May I give you theThe CHAIRMAN. Yes. 

Ms. BEATTIE. [continuing]-departmental number? 

The CHAIRMAN. Yes. 

Ms. BEATTIE. Roughly $199 million. 

The CHAIRMAN. One ninety-nine million? 

Ms. BEATTIE. Right. And, I'm also advised-! was not presentthat the $40 million or $45 million number is a number for recovery, that the discussion was about the recovery budget. The CHAIRMAN. Well, all I know is just what he is accusing the 

Congress. He says it's only costing 16 cents per voter. This is the 

type of information he's putting out. 
20 

Now, Rollie, before I jumped on you awhile ago, the thing that 

got me is what you were saying is what is in our bill. I'm not arguing about our bill. 

Peer review, rewarding, identification, all of this is in our bill. How many of you read our bill, by the way? 

Have you read it, Rollie? You read it? 

Mr. SCHMITTEN. Yes. 

The CHAIR..l\fAN. Have any of you critiqued the bill and offered 

back to the Committee what you think should be improved upon 

it? Or, have you been told not to do it? Or, have you been asked 

to do it? 

Well, I'm asking you to do it. And, let's start with you, Mollie. 

What's wrong with our bill? 

Ms. BEATTIE. I'm sorry, sir. You are talking about--

The CHAIRMAN. 'What's wrong with our bill, because you mention 

in your testimony--

Ms. BEATTIE. [continuing]-H.R. 2275? 

The CHAIRMAN. Yes. Ms. BEATTIE. We believe it.-do you mean, what's wrong with it 

in terms of--

The CHAIRMAN. Well, what's wrong with it? In fact, it has more 

funding in that bill for ESA than presently exists today. 

Ms. BEATTIE. It's our understanding, Mr. Chairman, that that is 

an authorization, not any kind of an appropriation. The CHAIRMA...l\1. Well, that's the whole ESA Act itself. We can't 

do anything. This is what's in the Act itself. It's authorization under the original Act. And, we appropriate money under the appropriations process. 

But, under the--our bill, we actually authorize a higher number 

of dollars to be spent on what we all think is very, very important. What I am asking you, and what the Secretary is going to be 

asked, no one has ever told me what's wrong with our bill. 

Ms. BEATTIE. Well, we--

The CHAIRMAN. All I've ever heard is it's a terrible bill, because 

Don Young and Richard Pombo wrote it. 

Ms. BEATTIE. Well, certainly--

The CHAIRMAN. That's all I hear from the Sierra Club. That's all 

I hear from Friends of the Earth. That's all I hear from all the rest 

of them. 

But, no one has ever said what's wrong with the bill. In fact, I 

talked to the Secretary at the beginning of this session and I said, 

"Bring down some suggestions on how we can improve this Act, 

where people hate the administrations right now and," not this Administration, every administration, "how it has been implemented." 

I've never got that. 

Ms. BEATTIE. I think we would be happy to provide you with 

some of our substantive criticisms. Many of them have to do with 

the effect on the scientific base of the Act. The CHAIRMAN. Again, I'm just saying this has been used as a 

political ploy when there is a definite need for improvement upon 

that Act. I heard Jack Ward Thomas say that. I heard Rollie say 

it. In fact, I've heard every one of these agencies say it. 
21 

Even Ms. Goodman here, in fact, talks about the Defense Department. Has any of the other agencies ever told you you couldn't do 

something at the Defense Department because of the Endangered 

Species Act? 

Ms. BEA'ITIE. Have any of the other--

The CHAIRMAN. No, no. I'm talking about Ms. Goodman now. 

Ms. BEA'ITIE. Oh, I'm sorry. 

Ms. GOODMAN. Mr. Chairman, the current Endangered Species 

Act does provide for a national security exemption. The Department of Defense has never sought such an exemption. The CHAIRMAN. So, you don't have to list anybody if you don't 

want to? But, you have been-you've been--

Ms. GOODMAN. We could seek an exemption under the Act, but 

we have never seen the need to do so. 

The CHAIRMAN. OK. Now, secondly, who participates in endangered species cataloguing of those species on military bases? 

Ms. GOODMAN. Each of our military installations participates. 

They have--

The CHAIRMAN. I mean, anybody, any other agencies or is it just 

you? Is it in-house? 

Ms. GOODMAL'l". We work very closely with the Fish and Wildlife 

Service at all of our military installations that have threatened 

and/or endangered species. The CHAIRMAN. All right. I'm out of time. And, Richard Pombo, 

would you take the Chair, please? 

And, you can continue this questioning. 

Mr. POMBO. I recognize the Ranking Member, Mr. Miller. 

Mr. MILLER. Thank you, Mr. Chairman. I guess this hearing is 

about the allegations of the Chair, whether or not the Secretary of 

the Interior is a liar or not. 

And, those are obviously very serious charges. And, I don't think 

that the testimony to date supports those charges. 

But, let's just-let me ask a couple of questions here. In the figures-apparently this is all going to depend upon these figures that 

are developed or have been developed. 

Mr. DeFazio just raised the question about the figure reported by 

the Corps, what amount of that is reimbursed by BPA with respect 

to the Columbia River operations system, what amount is reimbursed by BPA. The Northwest Power Act requires you to reimburse up to what amount? 

Mr. ROBERTSON. Which is, on average. We reimburse the hydro 

power cost associated with dams about 78 percent. Mr. DeFazio's 

point is a good one. We do add reimbursable costs into our cumulative--

Mr. MILLER. And, those costs are driven by the Northwest Power 

Act? 

Mr. ROBERTSON. That's correct. Mr. MILLER. When you apply-and let me ask you both, the 

Corps and-because I don't know whether it applies both to the 

Corps and BPA. When you apply costs to maintenance of species 

or recovery programs, all the regimes that you operate under there, 

you apply a cost of power revenues foregone and the purchase of 

substitute power; is that correct? 

Mr. ROBERTSON. Yes. 
22 

Mr. MILLER. Do you do that when you reduce flows for irrigation 

and/or navigation? 

Mr. ROBERTSON. No. Mr. MILLER. I see. So, the critters get charged, but those who use 

the river system and those who require you-the laws that have 

been written for you to withhold water for navigation or withhold 

water for irrigation so you can do time of release do not get 

charged? 

Mr. ROBERTSON. Under the Acts, including the Northwest Power 

Act, we have a responsibility to determine the crediting mechanism 

for fish and wildlife, to include, for example, purchased power that 

we get from California, for example, in order to mitigate for those 

flows. So, we are trying to comport with the laws of--

Mr. MILLER. No. That's what the law requires you to do. Mr. RoBERTSON. That's correct. Mr. MILLER. But, the allegation that is made that, you know, 

somehow the Secretary is a liar here might be suggestive that 

maybe Congress is cooking the books, because we have skewered 

the accounting system against that. And, I would assume that if I 

went down to the Central Valley Project I might find the same 

thing. I don't know whether that's true or not. I think they are here 

later or something. 

I don't know when you put on the books, the Colorado River system puts on the books, releases for environment if those are costs 

or releases-where they hold for irrigation late in the year, whether that's a cost or not. I don't know. 

But, I think when we make allegations about somebody's lying, 

we ought to know how the figures are, in fact, arrived at, whether 

we are-I think in one of the memo's we've been given the background for this hearing, in fact, the moneys from BPA to the Corps 

have been double counted. I don't say you've done that, but I think 

in putting these figures together. These are very serious charges. 

And, in fact, I think the other thing that would be helpful for us 

to know-and maybe you can help for the hearing next week-and 

that is to what extent are these costs driven by other statutes. 

Some of these costs are driven by statutes creating the refuge system, creating obligations within the refuge system. 

They are driven by the Central Valley Project Improvement Act. 

We have obligated that project now to do certain things outside of 

ESA or in accordance with or compliance with state obligations 

that are there and state sense of responsibility is there. 

What, if any, of these costs are driven by state acts, proposals 

or projects, where you are responding to state highway systems or 

to state tidal land decisions? 

I mean, I think this is important, because the notion that you are 

going to lay all of this off on ESA and if there is not a dollar for 

dollar accounting that somehow the Secretary is a liar, I think 

completely-it's my impression that this would completely 

mischaracterize how this law is administered in conjunction with 

a whole other set of bodies of laws that have grown up in the forestry industry, in the Bureau of Reclamation and in the Power 

Acts, in the Refuge Acts. You know, I think that we've got to take 

a look at that. 
23 

The biggest figure-since I came to the hearing-that has been 

on the table is the BPA, the $265 million. What would you be 

spending, you know, just under the Northwest Power Act? 

Mr. ROBERTSON. As I indicated in my testimony, Mr. Miller, 

there is a significant amount of costs associated with the Northwest Power Act and the Planning Council's Fish and Wildlife Program that is designed by the four northwest governors. 

Mr. MILLER. Right. 

Mr. ROBERTSON. But, we did our best, because it's an integrated 

hydro system and if you pull a piece apart--

Mr. MILLER. Well, that's--

Mr. ROBERTSON. We did the best we could to kind of figure out 

from this which were ESA-dominated costs versus costs associated 

with the Northwest Power Act and theMr. MILLER. But, pardon me. I am running out of time, and I 

don't mean to characterize you. 

But, I mean, I think that's the point. These are integrated systems. The CVP, the Colorado River system, the refuge system of 

this nation, the shorelines of this nation, the tidal lands, these are 

all integrated systems. 

In some cases, they run across states. And, the fact of the matter 

is that they are integrated. 

And, the fact is in many of these instances the Congress has 

come in with independent actions-! assume they are representing 

the constituents of their states and their districts-and directed 

these entities, these various power authorities and others, to take 

better care of the environment and have given you the costs and, 

in some cases, given you the money to do that. The Northwest 

Power Act and the Planning Councils came long after ESA. 

Am I right, Peter? Isn't that correct? Because there was concern 

in the northwest about the loss of these species. 

The Central Valley Improvement Act came long after the initiation of either the Central Valley or ESA, but we directed costs and 

we directed expenditures. And, so I think it's a little disingenuous 

to suggest that all environmental costs end up on the back of ESA 

or even the administration of ESA ends up on the back of ESA, because you are directed to do things that are in conformity with or 

in spite of ESA under these various authorities. 

Thank you, Mr. Chairman. 

Mr. POMBO. Mr. Hansen. 

Mr. HANSEN. Thank you, Mr. Chairman. In regard to the validity 

of some of the things that the Secretary has said, let me point out, 

if I may, respectfully, and that is Mr. Hefley passed a bill called 

H.R. 260 some time about national parks, which most of the people 

from the Department agreed on in the 103rd session of Congress. 

Now, I have a list of everyplace the Secretary has been going. In 

fact, I happen to have every statement that he has made. 

And, he talks about the closing of national parks all on through 

his statement. And, I would sure like to see somewhere in H.R. 260 

that it closes one national park. 

In fact, on Page 13, it specifically states it closes no national 

parks, only the same way it has been done. And, if anybody wants 

that list of the Secretary standing up and whipping up the crowd 
24 

to a frenzy about these crazies, they are closing national parks, I 

would be happy to do it. 

And, I am looking forward to having the Secretary come in, because I intend to go through that list point by point, park by park. 

And, let me unequivocally state there is no park closing bill, regardless of what Secretary Babbitt or President Clinton has said. 

Now, call that what you want, but somewhere along the line, I 

have a very hard time saying that is truth of the first way. 

Ms. Beattie, if I may ask you a question, a lot of people around 

here have talked for a long time and we've spent a lot of time in 

this Committee trying to modify the Endangered Species Act. For 

some reason, some people get the impression that if a bill is passed 

around here that it has come from the hands of Moses and it cannot be changed, one comma. 

I personally feel that Mr. Pombo and Chairman Young have done 

a very good job. And, the Committee has worked very diligently on 

this. 

I haven't seen from your group anything saying where you agree 

or disagree with the bill that has now passed this Committee regarding the Endangered Species Act. Is there such an animal? 

Have you given us some suggestions on it? And, who didyou give 

it to? 

Ms. BEATIIE. Mr. Chairman, I believe that we-and, Congressman, I believe that we did provide testimony, a hearing at which 

I was not present, but Assistant Secretary George Frampton spoke 

to the bill and, I believe, provided a fairly detailed critique. 

Mr. Chairman, may I also read-maybe I can clear up a little 

confusion on this $40 million number and perhaps go back to the 

question. I've got a letter from Assistant Secretary Frampton to 

Chairman Young, dated April 1st. 

He says, "For Fiscal Year 1995, Service appropriations to carry 

out programs for the recovery of listed species were $39.7 million." 

That may be misleading, because recovery under the Endangered 

Species Act has a capital "R." It is actually a sub-line item. It has 

a formal meaning. 

This paragraph may look like we simply mean the recovery of endangered species is the whole program. But, $39.7 million was the 

recovery-essentially the line item. That's not quite technically 

true, but the line item. 

One other paragraph. In the same letter, the Secretary says, 

"Based on the published Federal and state endangered species expenditure reports, for Fiscal Years 1989 to 1993, which identify expenditures that are reasonably identifiable for the conservation of 

threatened and endangered species by Federal and state agencies, 

about $861,800,000 was expended during the five year period." 

So, I think the distinction here is between a total number and 

a $40 million number quoted as one sub item of the endangered 

species budget. And, that may have led to the confusion. 

That letter is April 1. And, I believe all members have it. 

Mr. HA.i'l'SEN. How many-let me ask you this question. 

Mr. POMBO. Not taking from your time, Mr. Hansen, I would like 

to request that he be given the additional time. The quote that I 

believe the Chairman referred to that came from the Secretary was 

that-and this is from the Secretary, "Never mind that this Act is 
25 

working, having saved 99 percent of all listed species. Never mind 

that it effectively protects hundreds of plants and animals from 

grizzly bears to whooping cranes to greenback cutthroat trout. 

Never mind that it's doing so well, costing each American 16 cents 

per year." 

That was the quote that came from the Secretary. And, I have 

read Mr. Frampton's letter, but I believe that the letter is different 

than what the Secretary said. 

So-and I will yield back to Mr. Hansen. 

Mr. HANSEN. Thank you. Let me just state that regarding the information that Mr. Frampton has, I haven't seen it as one of the 

senior members of this Committee. 

And, I really think this Committee worked very diligently. I don't 

think one of us came up with anything we really wanted. 

This was a composite of what we felt should be changed. Every 

law, you work with it awhile and you see that it has some necessary changes. 

And, I think this is what happened in this Act. I am a little disappointed in the Administration for not coming up with something 

to say, "Look, we disagree." 

I've had call after call in to Mr. Babbitt and Mr. Kennedy. And, 

Mr. Kennedy has returned most of my calls, as Jack Ward Thomas 

does. And, we can sit down and resolve things. But, I kind of-when I get this stonewalling bit, it kind of irritates me a little bit. I would kind of like to know why it's so doggone hard to do an HCP. 

In the state that I represent, down in southern Utah, we have 

the desert tortoise. And, that little county of Washington County 

put millions of dollars in it. 

They came back here, spent hours and hours with George 

Frampton. I went down with them twice. And, it took us years to 

get it done at a cost that would, in effect, break most of our little 

counties and cities in America. 

Why is it so very difficult? And, we really didn't change it much 

from the first to the last. I mean, where is all this red tape coming from? 

Ms. BEATTIE. Congressman, it's difficult, because it's new. When 

we first came to this job and the idea of actually using HCPs, we 

had, I think, about 20 in place. We now have 150 in place and 200 

applications in our in-box. 

And, so we are getting good at it. Any time you take time to involve all parties to be very careful about-to provide long-term 

plans that provide certainty, it's going, in the short run, to cost 

more and save money in the long run. 

We just, as of yesterday, finished essentially an HCP in southern 

California. It was approved by the County Board of Supervisors in 

Orange County by a 5/0 vote yesterday. 

And, here is a letter from a development company in southern 

California. The Irvin Company has been a participant, because it 

seemed to hold a promise of a better way to achieve meaningful environmental protection in concert with continued economic prosperity. 

An HCP offers several advantages. Comprehensive planning of 

multiple species and habitats before they are in crisis; in other 
26 

words, preventative medicine. Coordinating overlapping, Federal, 

state and local regulatory processes. 

Now, that kind of thing is important to do. And, it doesn't come 

cheap. It takes time. Voluntary local consensus building and greater certainty for the environment and the economy. 

Mr. HANSEN. The problem with your HCPs is when you finally 

get one resolved, you move into a lot of private ground. And, the 

few I have watched, that's what it was a result of. 

And, in Washington County in the State of Utah, they have 

agreed to buy a lot of private ground. If I take that and extrapolate 

that out over the number of areas where HCPs are pending, you 

don't have enough money in the budget. 

You don't have enough money in your budget to take care of 

what you have agreed to do on the private ground in the State of 

Utah. How do-this is kind of nonsense. 

What's going on? 

Ms. BEATTIE. Congressman, I can tell you that we are making 

them work and that it's an eminently sensible approach to say, 

"Look, this habitat here, let's keep the economy going on this habitat here and let's save this habitat over here." It-and you are 

going to---

Mr. HANSEN. Ms. Beattie, what I'm saying is an HCP is sitting 

there and finally we agree on this is private ground where we happen to have an endangered species and this is public ground. And, 

we finally start drawing lines and saying this will be here. 

But, we can't just say to those people, "Well, you've owned the 

ground for 40 years. Take off, guy, you don't deserve it anymore." 

We have to pay them. 

I mean, that's just basic law, so to speak, eminent domain in the 

counties and the cities. We do that all the time. 

Just in this one instance, I don't think it will be 20 years before 

those people are paid off. And, what do they do in the interim period? 

I mean, you've got-you are talking millions and millions of dollars right there in that little county. 

Ms. BEATTIE. Congressman--

Mr. HANSEN. Now, I go over to the Mojave area. You start going 

into the areas around the Grand Canyon. You go to the areas in 

the south. 

I just don't know where you are going to come up with that kind 

of money. 

Ms. BEATTIE. Well, with your permission, I would love to provide 

you with some of the funding mechanisms that we have used to 

make these HCPs work around the country. And, many of them are 

very creative. And, we have many successes. Mr. HA.."'l"SEN. Well, I guess my time is up. But, I would like to 

send you some questions. And, I would really appreciate it if you 

would respond to them. Ms. BEATTIE. I would be more than happy to. 

Mr. HANSEN. Every time I send a question to Mr. Babbitt, I don't 

get a response lately. But, I would like to have some of you folks 

respond. And, I would appreciate it. 

Thank you, Mr. Chairman. 

Mr. POMBO. Thank you. Mr. Kildee. 
27 

Mr. KILDEE. Thank you, Mr. Chairman. To Ms. Beattie, could the 

moratorium, an additional listing of endangered species, not only 

lead to possible extinction of some species but also to a greater cost 

to the taxpayer in saving certain species because of the greater 

endangerment? 

Ms. BEA'ITIE. Yes, Congressman. I think the number I have here 

is 243 species are being held in limbo. These were already proposed 

for listing in addition to another 182 candidates species. 

Of that 243, I believe the number is about 160 that we are worried about may get very close-are getting closer to the brink. They 

have significant threats facing them, significant ongoing threats 

facing them, from which they are now not being protected. And, the basic theory of the Endangered Species Act expenses is 

that the longer you wait the more it costs. The longer you wait, the 

less certainty you can offer landowners, the less kind of cooperative 

long-term planning you have time to do. 

It's the old theorem that the lack of planning always costs more. 

And, if we have to wait until the species has gone over the edge 

and try to pull it back on, it takes more effort, more money and, 

I would say, more chaos. 

Mr. KILDEE. What was the-I wonder just what the purpose of 

the moratorium was. Was it to save dollars or was it some problem 

with the concept of biological diversity? 

Ms. BEA'ITIE. I can't speak to that, Congressman. Mr. KILDEE. I probably should ask the person who put the moratorium on. But, it would seem to me that it wasn't the question of 

trying to balance the budget, as was in the Contract With America, 

trying to balance the budget. 

But, it would seem to me that when you put a moratorium on 

something like that, it's really a misconception or a lack of agreement with the idea that biological diversity is very important. 

Ms. BEA'ITIE. That would certainly have a negative effect on biological diversity. I can't speak to whether that was the intent. 

But, if it were either to reduce costs or improve certainty, it has 

had the opposite effect. 

Mr. KILDEE. Thank you very much. 

Mr. MILLER. Will the gentleman yield? 

Mr. KILDEE. I will be glad to yield to the gentleman. Mr. MILLER. On that point, I think already in California we have 

seen a case where the moratorium-where we have small businesses that are associated with recreational fishing and some of the 

commercial fishing interests who have sought the listing of the 

salmon but have been now told by the court that because of the 

moratorium, while it should be listed, they cannot list it. And, I 

think the point made here by Ms. Beattie is that the longer we 

wait the more expensive it gets. 

These people actually believe-and I think with some pretty good 

intuition here, given the history of these fisheries-that they are 

going to lose their business opportunity and their investments if, 

in fact, we don't take steps now to try to save these fisheries. But, 

that's all being put off under the moratorium. 

So, it's not about saving money. It may be saving some administrative dollars somewhere in the governmental organizations, state 

and local governments. 
28 

But, it's costing private people a lot of money, because what they 

can't either arrive at is the certainty of knowing where they are 

going and getting on with these actions so people can, in fact, utilize their business opportunities, their land or otherwise. And, so, 

you know, it's having its effect. 

It wasn't a free moratorium .. And, unfortunately, in this case, it's 

hitting a lot of relatively marginal and small family businesses that 

caters to tens of thousands of people who enjoy recreational fishing 

and create that industry in parts of the west coast. 

I thank the gentleman for yielding. 

Mr. KILDEE. Thank you. I yield back the balance of my time, Mr. Chairman. 

Mr. POMBO. Mr. Saxton. 

Mr. SAXTON. Thank you, Mr. Chairman. Mr. Chairman, from the 

testimony today, I think everybody in the room can agree that the 

Federal Government alone spends significantly more than $40 million a year on endangered species matters. 

And, so, at least for right now, I would like to get past that and 

just say that we spend a significant amount of money, whatever it 

is. And, we ought to be about trying to figure out how to spend that 

in the most efficient way that will benefit everybody who is interested in this issue and, in fact, the endangered species as well. 

It seems to me that the reauthorization ought to proceed with 

that in mind and that there are, at least, two major concerns. One 

was exemplified in the "Philadelphia Inquirer" a month or so ago. 

And, there are a group of people who are very concerned about 

making changes to the Act to take care of these concerns that were 

expressed in this article. And, that is that-the headline of the· article said that more species are disappearing today than at any 

time since the dinosaur disappeared. 

That was the headline. And, the article went on to explain why 

that was happening and gave examples. 

And, there is another group of folks who are equally concerned 

about this Act, because they think it doesn't work very well for 

them in their areas. And, there is a legitimacy to that, as well, because many people have suffered grave economic losses because of 

the way this Act operates. 

Now, in listening to the testimony this morning, I heard, and 

particularly Rollie Schmitten began to talk about how to change 

the Act to solve these kinds of problems. And, that's what I think 

we ought to be doing. 

Now, Ms. Beattie, let me just ask you. Rollie mentioned prevention. If, in fact, we were able to prevent species from becoming 

threatened, much less endangered, it seems to me that that would 

be a good exercise. It would certainly cost the Federal Government 

less, I would think. 

Do you have in mind any ways that we might look at legislation 

that might begin to accomplish that? 

Ms. BEATTIE. Yes, we do. The 10 point plan that we put out last 

year, just a little over a year ago, included mostly administrative 

changes that would move us toward higher certainty at lower costs, 

better conservation, et cetera. 

Mr. SAXTON. Entering into agreements with landowners that--

Ms. BEATTIE. Yes. 
29 

Mr. SAXTON. [continuing]-they might agree to voluntarily? 

Ms. BEATTIE. Exactly, which is largely what the Habitat Conservation Planning covers. There were also in that 10 point plan 

several improvements toward the end that you just mentioned, 

Congressman, and other improvements which, again, we agree 

need attention that really require a legislative change. 

And, I could give you some examples. They involve some sort of 

technical explanations of the Act, which areMr. SAXTON. Thank you. 

Ms. BEATTIE. [continuing]-fairly--

Mr. SAXTON. Let me move on to another question, because my 

five minutes will just fly right by. I spent several days last week 

out with Ms. Cubin in her district, talking with her constituents 

about predator control. And, of course, you can't talk about predator control without talking about the Endangered Species Act. 

And, it seems folks in Wyoming don't like this Act at all, as you 

probably know, or at least most of them don't. And, one reason is 

that we have protected the grizzly bear to the extent that many 

ranchers think they are going to be out of business because of predation that happens because of the recovered grizzly bear. 

And, yet it continues to be an endangered and protected species. 

It seems to me that there ought to be some changes to the current 

law with regard to the de-listing process. 

Now, Mr. Pombo has suggested some very dramatic changes, I 

think. Maybe they move in the right direction. Maybe they move 

too far. 

But, it seems to me that there would be more public support if 

we could do something to streamline the de-listing process. 

Ms. BEATTIE. I agree with you. In times, Congressman, of short 

budgets, the de-listing process sometimes doesn't get as much of 

our attention as many other emergencies that are facing us. 

We have worked very hard to turn that around recently and to 

work on as many de-listings and what we call up-listings, going from endangered to threatened, which has much more flexibility in 

terms of how you can deal with those species. 

Mr. SAXTON. let me just move on to another subject that's near 

and dear to my heart. And, that is peer review. 

It's not required under the current law, as I understand it. Do 

you believe that there should be more expert scientific attention 

paid to these issues and would that help the bill to work better? 

Ms. BEATTIE. I will say that we would welcome a legislative 

change that reflected the fairly thorough peer review through 

which we put our decisions now. Because the law doesn't require 

it doesn't mean we haven't been doing it. 

And, we have been doing it fairly assiduously and fairly carefully. We seek out all experts on an issue and ask them to look at 

our decisions and to make recommendations to us. 

Mr. SAXTON. Well, thank you. Once again, Mr. Chairman, I think 

we have established that there is a significant expenditure on behalf of endangered species. 

And, I think that the Chairman should be commended and you 

should be commended for helping to bring this matter to light. And, 

I would just like to say that the issues that I just discussed with 

Ms. Beattie are issues that I know you are concerned about and 

24-936 96-2 
30 

that I'm concerned about and that Mr. Gilchrest is concerned 

about, and I'm sure others are concerned about. 

And, I think we can find some common ground here if we work 

together, as Mr. Gilchrest suggested in his opening statement. 

Thank you. 

Ms. BEA'ITIE. Thank you, Congressman. 

Mr. POMBO. Mr. DeFazio. Mr. DEFAZIO. Thank you, Mr. Chairman. I would like to go back 

to the point I raised when the Chairman was in his initial interrogatory, which is the double counting. 

I mean, you all are members of one Administration. And, I would 

hope that by next week, apparently when the Secretary is coming, that the Administration could come up with a unified number that 

doesn't double count. 

But, let's-! mean, at this point, now, General, have you had an 

opportunity to review that issue? 

Maj.Gen. GENEGA. Sir, I don't have the number. I would like to 

submit that for the record. 

[The information may be found in letter of April 22, 1996, at end 

of hearing.] 

Maj.Gen. GENEGA. 1-my numbers do include the reimbursement 

from BPA. I'm certain of that. I just don't know the amount. But, I will submit it for all those 

years. 

Mr. DEFAZIO. OK. And, Mr. Robertson, then your numbers would 

reflect the reimbursement to the Corps of Engineers? 

Mr. ROBERTSON. Our overall numbers do reflect our reimbursement historically to the Corps of Engineers, that's correct. 

Mr. DEFAZIO. All right. There's at least one clear instance of, you 

know, millions of dollars of double counting here. 

And, I would like to make certain that we, as much as possible, 

get those things clarified. 

To Mr. Robertson also, to follow up on Representative Miller's 

question about the other things which are or are not counted, my 

understanding is the number you have given us here reflects power 

foregone and power purchased. And, you are saying-! thought I 

heard you say, but it would seem to me to contradict, that you have 

somehow culled that down and these numbers are attributable 

mostly to ESA as opposed to the Northwest Power Act requirements? 

Mr. ROBERTSON. The total amount of our budget for fish and 

wildlife, as I indicated, is $435 million. And, of that amount, about 

$183 million, on average, is for power purchases or for foregone 

revenues, which is basically spill at each of the Federal projects. 

In the breakout that we sent the Committee, as of March 14th, 

we do include both power purchases and foregone revenues as one 

of the expenses. They are included as an ESA-related expense. And, they are tabulated because of the calculus specifically in 

1996 at $195 million together. Mr. DEFAZIO. But, at another point in your testimony, you said 

that you had tried to discern what was attributable to the Northwest Power Act and what was attributable to ESA. 

Mr. ROBERTSON. Right. 
31 

Mr. DEFAZIO. Now, you are not saying that all your so-called 

foregone revenues and power purchases are attributable just to the 

Endangered Species Act? 

Mr. ROBERTSON. Well, the biological opinion that was put together by NMFS since 1980 has increased the number-the river 

has changed dramatically as a result of the biological opinion. And, 

that has changed the shape and course of our power purchase responsibilities and our spill as well. 

Now, coincidental with that-so beginning in about 1992, as we 

went through biological opinion review under the ESA, we did 

change flows and spill significantly. And, we tried to capture that 

reality in the numbers. 

There was, coincidental with that, changes associated with the 

Council Plan under the Northwest Power Act, most recently in 

1994. And, they also incorporated changes of spill and flow. 

And, so the fundamentals are that since the law requires that we 

act under both of those Acts, we are significantly adding those 

costs. And, your question is why is it counted ESA versus under 

the Northwest Power Act. 

Mr. DEFAZIO. Yes. 

Mr. ROBERTSON. The answer is that it's related largely to biological opinions. If the Northwest Power Planning Council changes 

their fish and wildlife program numbers discussed, and the ESA 

didn't exist, those numbers would drop. 

Mr. DEFAZIO. But, the Council plan, as I understand the Council 

plan, and I'm somewhat a student of this, I think would engender 

most of the same costs. 

Mr. ROBERTSON. I think that's fair to say under the present plan. 

Mr. DEFAZIO. So, I think that the statement earlier that you had 

culled down to things that were mostly attributable to ESA is not 

entirely supportable here. And, in fact, we would say that even if 

the ESA were repealed or the Pombo/Y oung version of ESA were 

put into effect, you would still have a significant number of those 

costs. 

And, also in terms of--

Mr. ROBERTSON. As long as the Power Council didn't changeMr. DEFAZIO. Right. And, since they are charged with recovery 

and since we've gone from salmon too numerous to count to salmon 

that we can individually name, I don't think the Council is going 

to immediately-if I could ask Ms. Beattie just for reference, where 

do most of the Columbia River salmon go? 

Are they north turning or south turning? Are you aware? 

Ms. BEATTIE. A trick question. 

Mr. DEFAZIO. Well, Rollie, do you want to answer that? You 

know that? 

Mr. SCHMITTEN. Yes, Mr. Chairman. Most of them are north 

turning. 

Mr. DEFAZIO. North turning? 

Mr. SCHMITTEN. Yes, sir. 

Mr. DEFAZIO. Where do they go? 

Mr. SCHMITTEN. They go both off of the north coast of Vancouver 

Island, then off the southeast portions of Alaska, out into the Bering Sea and make a cyclic turn and ultimately come back at the 

end of four years. 
32 

Mr. DEFAZIO. So, could we intimate that some of those salmon 

are perhaps caught by an Alaska-based fisherman? 

Mr. SCHMITTEN. Yes, sir. 

Mr. DEFAZIO. OK. I wish the Chairman was here. We want to 

make sure that he's aware of that. 

[Laughter.] 

Mr. DEFAZIO. If I could return to Mr. Robertson for a moment, 

I believe also, when I chaired a subcommittee oversight on BPA a 

few years ago, it took me-after three attempts I did finally get a 

number from BPA regarding foregone revenues because of irrigation and summer navigation. 

Are you familiar with that number? If not, I can provide it. 

Mr. ROBERTSON. I think it was about $150 million to $300 million, depending on the alternative costs. 

Mr. DEFAZIO. That's correct. OK. Thank you. I would just like to 

point out that, I mean, we have a disturbed river system. We have 

the dams. 

And, yes, if you ran the dams only for hydro power and excluded 

irrigation and excluded summer navigation and excluded fish and 

fish recovery, we could have cheaper power. But, I don't think that 

even my colleagues on the other side of the aisle would advocate 

that we do away with the irrigation and the navigation in order to 

have a pure market-based power rate. 

And, they probably might not even go so far as to advocate we 

shouldn't run it totally to the detriment of the salmon. But, maybe 

not. 

Mr. RoBERTSON. Just to add to the point, Mr. DeFazio, since 

we've submitted that information to you a couple of years ago, 

those numbers, we think, have gone down somewhat. They are still 

significant, obviously, but they are based on marketplace alternatives for power. And, as you know, those alternative marketplaces have gone down almost by half. So, the number is smaller 

but it's still significant, we think. 

We would be happy to provide an updated number for you. 

Mr. DEFAZIO. All right. Well, the marketplace-of course, marketplace power but also river conditions have changed. And, so this 

year I would assume that your estimates of foregone revenues due 

to spill, since my understanding is you are in a condition where 

you are spilling more than, in fact, people want to spill because of 

the high river conditions, that those numbers would come down, 

too. 

Mr. ROBERTSON. Right now, river conditions are 134 percent of 

normal. It's a huge water year. 

And, so we are spilling uncontrollably at this point. The river is 

only 40 percent controlled by the dams. So, there are a lot of control questions and spill questions that relate to natural runoff. 

Mr. MILLER. Could we put the fish power out to bid and see if 

maybe we could get a better deal? 

Mr. POMBO. Mr. Gilchrest. 

Mr. GILCHREST. Thank you. Just a quick, off the record comment 

to Mollie. I took my son to Castleton and Johnson. 

If we took the Fish and Wildlife budget dealing with ESA, I 

would suppose that we-and you don't have to tell us now, but the 

$39 million for recovery, there's also, I'm sure, line items for de-
33 

listing for habitat conservation costs, for research. All those items 

could be specifically given to us. 

Ms. BEATTIE. Absolutely. Som~e-listing is, in fact, the same 

line item as listing, which is why at the moment we have almost 

$2 million worth of de-listings to do, which we can't do because the 

entire listing crew has been put in mothballs because of the moratorium. So, the de-listings just sit there. We don't have anybody to 

do them. 

And, my point is that the de-listing and the listing are the same 

line item. But, yes, we can give you all that information. Recovery 

is a line item, et cetera. 

Mr. GILCHREST. I would like to ask a rather generic question and 

have each of you respond to it in the time that's remaining. Basically, what would you say are the benefits to the areas that you 

serve as far as the local people in those regions are concerned and, 

I guess to a larger extent, the Nation as a whole as a result of your 

expenditures directly related to the Endangered Species Act? 

We spend a lot of money, whether it's Fish and Wildlife, the Department of Defense, Corps of Engineers, NMFS, National Forest 

and so on. We spend money as a result of the law. 

Can you tell us, as a result of your activities, what are the direct 

and indirect benefits related to those costs? 

Does anybody want to--

Ms. GOODMAN. The direct benefit is that we in the Department 

of Defense are able to provide realistic training because we maintain the natural habitat. The indirect benefits are that we provide 

safe operations in terms of preventing bird strikes against aircraft, 

and we also provide flexibility in our training by working cooperatively with the Fish and Wildlife Service to recover species on one 

part of a military installation in order to allow for greater flexibility in training in other parts of the installation. 

The larger and very important indirect benefit is that our military is there to defend America. And, part of defending America 

means defending where we live, where we work and where we play. 

And, that's the natural habitat. That is part of our military, part 

of our American heritage. 

So, we take that as part and parcel of what the Department of 

Defense mission truly is. 

Mr. GILCHREST. Thank you. 

Maj.Gen. GENEGA. Sir, I would say it enables the Army Corps of 

Engineers to get the job done, to get our contribution to the economic security of this country in navigation, hydro power and flood 

control in a fashion that preserves the environment and thus ensures that frankly our grandchildren and great, great grandchildren are still going to be able to get those jobs done with a 

healthy environment. 

Mr. GILCHREST. Thank you. 

Mr. THOMAS. I could say that, one, is-again, as I said to begin 

with, I'm not sure this Act is costing us anything that we would 

not be obligated to do under other Acts that tell us how we should 

manage the people's lands. For example, to quote from the Endangered Species Act, "to provide a means whereby the ecosystems 

upon which endangered species and threatened species depend may 

be conserved." 
34 

Those are the same ecosystems that people depend on to provide 

over the centuries a flow of goods and services. 

I would also point out that, according to the Multiple Use Sustain Yield Act, it says that our objectives are to be accomplished 

without impairment of the productivity of the land, with consideration given to relative values of various resources and not necessarily the combination that gives the greatest dollar return or 

greatest unit output. 

So, basically, I think that this, along with the other Acts under 

which we do, is to preserve those ecosystems of which these are a 

symbol. And, then why do we do that? In order to retain the ability 

to produce goods and services that all the American people require. 

Mr. GILCHREST. Thank you very much. 

Mr. SCHMITTEN. Mr. Gilchrest, I think the direct benefit, from 

our point of view, is that no species have gone extinct. Under our 

management, the great whales, the fin fishes and others will continue in existence for future generations to enjoy. 

I think indirectly it certainly reflects what I hear the public saying in its support for the environment and species that are there. 

Many people, certainly in the northwest, identify the health of the 

environment also with the health of the species. 

And, bald eagles and salmon from the northwest are good indicators of species. And, so I think that we do provide a good service. 

Mr. GILCHREST. Thank you. With your indulgence, Mr. Chairman, there's two more. 

Mr. Robertson? 

Mr. ROBERTSON. Thank you. Just briefly, I'd like to make a point 

about salmon as a life long northwesterner. 

In the northwest, salmon is literally a religious issue. For example, salmon is essential to tribal rights and to the religion of the 

tribes. In all of the years that I've been involved in the fish issue, 

nobody in the northwest doesn't want to bring back salmon as 

quickly and effectively as possible because of jobs, because of religious objectives and because salmon is part of a way of life. 

No one wants to see salmon disappear. 

We have done many, many direct things with our fish program 

beyond flows and spill regimes that we talked about earlier. These 

include predator control programs, law enforcement programs, 

hatchery development programs, and research programs. We 

worked together with NMFS to save the sockeye of Red Fish Lake 

early before it went extinct. 

We have wildlife improvement programs throughout the region 

as a result of what we have funded. And, at Bonneville we are 

proud to have accomplished these things. 

I just want to re-stress that the funding for this comes from 

northwest ratepayers, through Bonneville. It doesn't come from 

U.S. taxpayers. 

We think there are specific breakthrough accomplishments that 

have occurred as a result of our actions that have been excellent 

for the future of the ecology of the northwest. 

Mr. GILCHREST. Thank you very much. Ms. Beattie. 

Ms. BEATTIE. Congressman, I've heard people mention benefits 

that are not up to me to judge, because whether they are locally 

valued or not is not up to me. But, benefits such as open space. 
35 

I will say, however, that economic activity that is driving species 

of plants and wildlife over the brink of extinction is probably, by 

definition, unsustainable. So, perhaps the conservation of species 

offers a foundation for a sustainable economy and a sustainable future for people. 

Mr. GILCHREST. Thank you. 

Ms. BEATTIE. And, finally, I would say that it allows local people 

not to have to look at their kids some day 20 years from now and 

say, "There used to be something here called a salmon. There used 

to be something here called a grizzly bear, but it was too much 

trouble and too much money for us to save." 

Mr. GILCHREST. Thank you all very much. Thank you, Mr. Chairman. 

Mr. POMBO. Mr. Dooley. 

Mr. DOOLEY. Thank you, Mr. Chairman. And, just in prefacing 

my questions, I would say I think it's unfortunate that we are 

spending so much time worrying about the accuracies of some 

statements of either the Secretary or anyone else. 

Obviously, any member of Congress spends a great deal of time 

trying to put the best spin on a lot of issues and messages that we 

are trying to send out there. And, I think the issue at hand here 

is really what are the policy changes we need to be considering. 

I think that there is no question we are spending a lot of money 

within the Administration on the implementation of ESA. I guess 

what I'm also concerned with, though, is that there is an associated 

cost that is also being incurred by other public agencies and private 

individuals that is directly related to the implementation. 

I know that the Administration was concerned about one of the 

aspects of the Pombo/Y oung bill in terms of compensation to private property owners as it would relate to additional costs which 

could not be absorbed by the agency. What I would be more interested in, though, is that there's other tangible and hard costs that 

other agencies, non-Federal Government, are engaged in in ten,ns 

of additional consultant fees mitigation fees that are being requested. 

Is there any effort on the part of Fish and Wildlife, Ms. Beattie, 

to try to account for any of these costs that are associated with 

ESA implementation by Fish and Wildlife? 

Ms. BEATTIE. I'm sorry, Congressman. Are you talking about 

those incurred by people who would not be here today with a total? 

In other wordsMr. DOOLEY. Well, we have some people that are going to be testifying in the next hearing, someone with the Kern County Water 

Agency. 

Ms. BEATTIE. OK. 

Mr. DOOLEY. And, you know, a case in point would be when they 

are being asked by Fish and Wildlife for what are ongoing operations and maintenance that there might be the occurrence of an 

endangered species, that they are being asked by Fish and Wildlife 

to have an offset of maybe a 20 to one in terms of acres. 

Does the Fish and Wildlife Service keep any type of accounting 

on what the request and what has been agreed to by other agencies, both public and private, non-Federal, in implementation of the 

ESA? 
36 

Ms. BEATTIE. We keep an accounting for other Federal agencies 

and down to the state level but not below. I can tell you that one 

of our proposals in the 10 point plan is to involve all impacted parties in finding the least cost means to recovery. So, that is one of our proposals. That may, in fact, give us an opportunity to keep a better accounting below the state level. 

But, that is one of our newly instituted policies. And, it would 

help us to that end. 

Mr. DOOLEY. And, I think that's something that I think we call 

be receptive to, because one of the things I think we are all getting 

at here is how can we ensure that we are going to maximize the 

expenditures, both by the public and the private sector, in terms 

of getting the greatest results, which goes also I think to the cost 

benefit as well as some way to quantify the benefits. 

Major General, I just had another instance in my district which 

showed a little bit of difficulty in maintaining some consistency 

within administrative agencies in terms where the Army Corps is 

in charge with managing the flood flows and flood storage within 

Lake Isabella in Kern County, which we had a problem earlier this 

year because of the habitation of a southwest willow fly catcher 

within the basin, the lake basin, itself actually in willow trees that 

were planted, as directed by the Fish and Wildlife. We had a situation there when the Army Corps filed their plan 

for the normal operations of the reservoir, which would be consistent with the flood control obligations, is that it triggered basically 

a consultation which ran the risk of not allowing that reservoir to 

be filled for the flood control. Obviously, it could impose jeopardy 

downstream. 

You know, you have projects throughout the United States. How 

often is this a situation which you are finding yourself in? 

And, are you finding yourself in a situation where you are having 

more difficulty resolving these issues now than you were five years 

ago? I mean, your budget obviously is showing you are spending a 

lot of money doing something a lot more than you did five years 

ago. 

Maj.Gen. GENEGA. Well, sir, I think it's fair to say that we are 

spending more energy on those kinds of things today. But, I would 

think that that--I would say that that is a result of the general 

heightening and the awareness of the American people to those 

kinds of issues. And, certainly we are spending more effort than five years before 

that or five or 20 before that. But, I think we are able to resolve 

those problems. 

We are able to achieve some balance, albeit a different balance 

than what we had five years ago or 10 years ago. But, we have 

been able to resolve them in most cases. 

Mr. DooLEY. I guess this gets back to the whole issue, though, 

in terms of what I think is critical in the allocation of the costs of 

providing for the societal benefit of the protection of species. And, 

how do we ensure it? 

I mean, it's obviously general fund dollars when it's administrative costs. But, sometimes we are asking private property owners, as well as some entities which are representing a very special or 
37 

smaller constituency, to bear the primary financial burden in providing for the preservation of species. 

And, I think that's what some of us are concerned with in terms 

of reform. How do we share this burden? 

And, I guess that is what brings me to my final question for you, 

Ms. Beattie, is that I have some concerns with what was the administrative proposal that would, in fact, exempt landowners of 

less than five acres? 

Once again, while you can make some arguments in terms of the 

aggregation of a land mass that could allow for maybe an effective 

mitigation, restoration or recovery, but at the same time you are 

once again limiting the number of people and those property owners who are going to be making a direct contribution to the recovery of a species. And, in fact, you are then once again allocating 

the burden of recovery to an ever smaller group of individuals. 

And, I guess, I just question how is the administration-when on 

the one hand you believe that economics shouldn't necessarily be 

a factor yet you introduce a policy such as limiting blanket the consideration of any landowner of less than five acres? 

Ms. BEATTIE. Let me start, Congressman, with your first point, 

which was how to share the burden. We have a number of proposals, a number of ideas, we would like to explore, which are really 

ideas for giving landowners incentives, which is different than compensation. But, it's certainly very workable. 

The instinct to take care of wildlife is already usually in landowners. If you can give them an incentive to go with it, then that's 

probably the least cost way to do it. 

We have a number of ideas on that one. On the-and I would be 

happy to come over and tell you what we've thought about with 

that. 

The question about the five acre exemption, we felt, first of all, 

compelled to go with something like that, because we discovered in 

the law that-and this only has to do with threatened species. And, 

we discovered in the law when a species is threatened, there is immediately a presumption that destruction of habitat will be a violation. 

That presumption-and that is not-the law does not require 

that. The presumption can be that what you are doing is OK unless 

we tell you. 

And, so we felt compelled to give landowners that kind of asince the law was not behind us on that and it had just been assumed over the years, we felt compelled to give some landowners 

an exemption. And, there had to be a breakpoint. 

How do you define, you know, who does and who doesn't? So, 

there had to be a breakpoint. 

And, that seemed like a good one. We looked at percentages of 

ownerships below and above certain thresholds. 

In terms of then putting the burden on an ever fewer number of 

landowners, we are then at least talking about larger landowners, 

which spreads it a little thinner. And, again, if we can come back 

to looking at incentives for landowners, maybe we can cure both 

problems. 

Mr. POMBO. Ms. Cubin. 
38 

Ms. CUBIN. Thank you, Mr. Chairman. Dealing with this Endangered Species Act, as well as the Young/Pombo version of the Endangered Species Act, reminds me of four blind people who were 

asked to identify an elephant. And, two of them are on the front 

of the elephant and two of them are on the back and everybody is 

telling the truth as they see it but certainly not getting the same 

result. 

And, I think that goes a long way in explaining why there are 

such vast differences in how people feel about the Endangered Species Act and whether or not it is productive and whether or not it's 

worth the money that has been spent on it. 

I think you all realize that the particular problem that Wyoming 

has in dealing with many Federal programs, whether it's with-not 

programs, agencies, whether it's the Park Service, the Forest Service or Fish and Wildlife, whatever, has to do with the ownership 

pattern of the land in Wyoming. It's-it originally was checkerboard with every other section being owned by the Federal Government. 

This was after the Homestead Act expired with every other section being owned by the Federal Government. And, the in between 

ones were private property. 

So, that is what--and, of course, that has-you know, it has 

changed a little bit through the years. But, there's still Federal 

property that is totally isolated by private property and vice-versa. 

So, that, I think, goes a long way in describing the problems that 

Wyoming people have in dealing with the Federal agencies. And, 

my request, to you all-and I know that you do it as much as you 

can, but to please take those special circumstances into consideration when dealing with problems that constituencies run into, whether it's with the Endangered Species Act or whether it's with 

forest plans or whatever, because it is a real, real difficult situation 

for everyone. 

I don't have, but I would love to have, a copy of the 10 point plan 

that you talked about that you developed last year for improving 

administration. I would like to have that very much. I actually have way more questions than I have time. I want to 

ask a little bit about the grizzly bear. 

What is the population goal for the grizzly bear? Do you know 

right off? 

Ms. BEA'ITIE. In terms of numbers? 

Ms. CUBIN. Yes. 

Ms. BEA'ITIE. 1 can't tell you, Congressman. But, I will be happy 

to provide that. I knew all those once. The-~me goal is to have three populations at a certain size. And, 

the reason we want three populations is because--! believe it's 

three, is because that gives us redundancy in the system so if you 

lose one to disease or predation or something. 

Ms. CUBIN. Yes. 

Ms. BEA'ITIE. So, that is our goal. And, we are very close with 

two at the moment. 

Ms. CUBIN. Do you know if the same plan--do you plan to do the 

same thing with the wolf? 

Ms. BEATTIE. Yes. The plan is similar, in that it calls for a certain number of packs in each of a few areas. And, we will then con-
39 

sider the wolf recovered. That's considered a self-sustaining number. 

Ms. CUBIN. So, you don't consider the grizzly recovered at this 

point? 

Ms. BEATTIE. It's getting very close but not quite, in our estimation. 

Ms. CUBIN. How many times has the-I believe, and I might be 

wrong on the numbers, but I believe that in the beginning, the plan 

for recovering the grizzly said when 250 grizzlies are alive and 

well. And, that happened. 

And, then it went up to 350. And, then it went up to 500. And, 

it has been increased many, many times. 

Why was that? I mean, because what it seems to me is that the 

plan changed over time rather than-or the administration 

changed over time--

Ms. BEATTIE. Or the finish line moved. 

Ms. CUBIN. I don't know what caused it. What caused that? 

Ms. BEATTIE. There are some technical reasons. It had to do with 

learning new things about the grizzly bear. 

And, I would be happy to provide those for you. I can't tell you 

off the top of my head, but they were biological sorts of-biological 

information coming from research or new understanding that made 

us think again. 

The grizzly bear is obviously a reclusive species that's hard to 

study and not as reclusive as I know some people wished, but--

Ms. CUBIN. Yes. In fact, people up there on the North Fork or 

the Park's Fork don't let their kids walk to school, because there 

are so many grizzlies in the Coyote area. People who live out in the 

foothills, we call them, but back here in the east they would call 

them mountains. 

But, the foothills in Park County, you really are not safe to be 

back in there, because in that area there are so many grizzlies. 

And, I mean, I do know this to be true, because I've been up there 

myself. 

But, anyway-so I would really appreciate knowing why the goal 

changed--

Ms. BEATTIE. I would be happy to do that. Ms. CUBIN. [continuing]-through the years. And, also related to 

the wolf-and I'm sure that you all are aware that I was opposed 

to the introduction of the wolf. They are there. 

So, it certainly is a waste at this point. I mean, I don't want to 

see a lot more money poured into the reintroduetion of the wolf, 

but certainly I hope it works now since they are there and we've 

spent the money anyway. 

So, I would like the same sort of analysis on the wolf. What 

changes do you foresee or-I mean, that's the problem, is that 

there is no certainty for the people that live on that land. 

And, so-and the distrust, not just for Federai agencies but for 

the Congress, distrust for the President, distrust for government, 

because it seems we change rules after the game starts. And, then 

my constituents say, "Hey, this isn't fair." And, it's hard to justify 

that it is. 

So--
40 

Ms. BEATTIE. I would be happy to get you the information on the 

grizzly bear and reassure you that it was on the basis-if things 

change, it was on the basis of scientific evidence, not on the basis 

of-' -

Ms. CUBIN. Politics. Ms. BEATTIE. [continuing]-politics. Right. 

Ms. CUBIN. I hope. Ms. BEATTIE. On the wolf, we don't foresee any changes. We also 

agree that we hope we never have to do another reintroduction, that the last one will bring the species up and off the endangered 

species list so it can go back to the states to manage and save us 

a great deal of effort. But, we don't, at this moment, foresee any changes in that pro- gram. Ms. CUBIN. As was expected, the population of the coyote is down 

because of the predation of the wolf. And, I think that's probably 

what all biologists planned. And, certainly I'm not sad to see that happen:. But, you know, it 

is worrisome that the larger animals now will be--I'm talking do- mestic animals-more threatened by the wolf than they were by 

the coyote. And, that has always been a problem that I wanted to avoid and 

I would like to resolve, you know, when those things occur. I don't 

think that-I think that preserving a species is good for the public. And, I would say it is. 

Then-and I don't know of anyone that disagrees with that. I 

mean, I don't think anybody, on whatever side you are on, wants 

to see species vanish off of the face of the earth. But, if it is for the public good, then shouldn't the whole public 

pay for it? I mean, shouldn't it be the responsibility of everyone instead of just those people who happen to own private land right 

next to federally owned land? 

So, you know, it's kind of a rhetorical question. Just a couple of 

more, Mr. Chairman, and then I will be quiet. Sometimes-on€ more minute? OK. Sometimes the ESA regulations force other government agencies to have to t ake a certain action based on the ESA. 

When there is a conflict, when you disagree, who should win? 

And, is there a process for deciding? 

I mean, I assume right now that you have the ultimate say because the ESA is the biggest law I know of. 

Ms. BEATTIE. In answer to your first question, we should win. 

[Laughter.] 

Ms. CUBIN. Right, always. Ms. BEATTIE. In fact, that's not in our interest, to win. 

Ms. CUBIN. All right. 

Ms. BEATTIE. Our interest is to have a decision made that is of 

mutual benefit and · protects our mutual interests, which they are. 

We have a very detailed process that is called consultation, which is also a iine item under the ESA, a very detailed process, now detailed in a handbook of how to make those consultations, 

how to resolve conflicts. And, I hope my colleagues will agree that 

nine times out of IO we do. 
41 

Ms. CUBIN. So, you-if you couldn't, then should-do you think 

that it would, in any way, be good to have a third party arbitrate 

that disagreement between two different agencies? 

Ms. BEATTIE. I'm sure there are a number of means we could use 

where there is a deadlocked conflict, which is a real rarity. 

Ms. CUBIN. The reason I'm talking about this is because unplanned money spent out of, say, the Department of Agriculture or 

Forest Service or something like that, that Fish and Wildlife mandates that, you know, a big portion of money come out of somebody 

else's budget, it surely would be easier keeping track of how much 

we do spend on endangered species or preservation if we could do 

that. 

So, I will be thinking along those lines, too. I don't have any further questions. Well, I do, but you won't let me ask them. Thanks. Mr. POMBO. Ms. Chenoweth. 

Ms. CHENOWETH. Thank you, Mr. Chairman. Ms. Beattie, I wanted to say that I'm very glad to see you back. You are a courageous 

woman and leader. 

Ms. BEATTIE. Thank you. 

Ms. CHENOWETH. And, you are a fine example for many women 

in leadership. It's good to have you back. 

Ms. BEATTIE. Thank you. 

Ms. CHENOWETH. I wanted to ask the General a couple of questions. General Genega, in 1991, the Corps of Engineers spent about 

$7.5 million directly on the Endangered Species Act. And, in 1995, 

you spent $94.8 million on the Endangered Species Act. And, that's 

a 1,300 percent increase in your expenditures. How many species have been directly recovered as a result of the 

Corps of Engineers' activities? 

Maj.Gen. GENEGA. I think it's fair to say that I could not take 

credit for any species recovered as a result of those expenditures. 

But, we participate with the other agencies, some or all of the other 

agencies, at the table here in recovery efforts for particular species. We-in preparation for this, we don't account for the dollars in 

that particular way. We don't account for them by recovery plan 

and our dollars toward that. 

We are embarked on a fair amount of research right now trying 

to go back a couple of years and see if we can reconstruct that. But, 

I think it would not be fair for me to take credit for any recovery 

plan by the actions of the Corps independent of the others. 

Ms. CHENOWETH. Do you still regard your first priority as being 

that of navigation in commerce-hydro power and flood control, as 

you mentioned earlier? 

Maj.Gen. GENEGA. Yes, ma'am. 

Ms. CHENOWETH. Where do those priorities line out in terms of 

your management of the Corps? 

Maj.Gen GENEGA. Well, I would say those are our priorities. 

Those are the Corps' missions. 

Now, we do those in a different fashion today than we have in 

the past. And, that's in response to various laws like the Clean 

Water Act, like the Endangered Species Act and the Safe Drinking 

Water Act and on and on, though we do them in a slightly different 

fashion. 
42 

But, I come to work everyday committed to, as do some 27,000 

other employees on the Civil Works side of the Army Corps of Engineers, delivering our responsibilities under navigation and flood 

control and hydro power. 

Ms. CHENOWETH. General, in 1994, the Corps was appropriated 

an overall amount of $208 million to carry out its duties. And, in 

that year, roughly $52 million was spent on the Endangered Species Act. 

In 1995, however, the Corps was appropriated $192 million for 

its overall mission, And, yet, it spent $95 million on the Endangered Species Act. 

I don't understand the difference between 1994 and 1995, in that 

it appears that the priorities may have changed to the degree that 

in 1994 25 percent of your expenditures went toward ESA and in 

1995 it appeared that nearly 50 percent or over 50 percent went 

toward the Endangered Species Act. Now, that concerns me, because there are other priorities, too, such as navigation, hydro 

power and flood control. 

And, how many of these cuts were directed at the other priorities? It had to be-there had to be other priorities that didn't have 

the attention that ESA had. Maj.Gen. GENEGA. Yes, ma'am. I will have to get with you, I suspect, afterwards to see the source of those figures that you gave. 

My appropriation from the Congress under the Energy and 

Water Act for the entire Civil Works for 1995 was about $3.4 billion. And, you mentioned a number of-so, the $95 million expenditure is against that $3.4 billion as opposed to the number that you 

used. I'm not sure of the source of those numbers. 

Ms. CHENOWETH. Well, these were duties in recreation. These 

were appropriations for recreation. 

Maj.Gen. GENEGA. I see. 

[See letter of April 29, 1996, at end of hearing.] 

Ms. CHENOWETH. And, I also wanted to ask Mr. Schmitten, in 

1991 the National Marine Fisheries Service spent $3.6 million on 

the ESA. In 1995, there was $21 million that we have--these are 

the figures we have gotten in our office. 

And, that's an increase of over 700 percent. What-how many 

species were recovered as a result of that 700 percent increase? 

Mr. SCHMITTEN. Let me first explain where the cost came from. 

In 1990, we received the first ever Pacific Northwest salmon listing 

petition. That has increased to probably over two dozen petitions 

since then. 

The first final listing of salmon species in the Pacific Northwest 

occured in 1991. At that point, our cost did significantly increase 

because we went to managing the species. 

As far as recovery, we have not lost any species. 

Nothing has gone extinct once we have taken over. And, we have 

implemented actions in the recovery plans for the species. So, we 

have not lost anything for the public. I'm sorry, I need to also answer your question. Recovery is measured by the recovery team in the life cycles. 

And, it's estimated that it will take 12 years for a full recovery. 
43 

Ms. CHENOWETH. Mr. Schmitten, we have not had one sockeye 

salmon return to Red Fish Lake. And, yet we have built huge 

amounts of paper. 

We, in Idaho, are becoming increasingly impatient with the National Marine Fisheries Service. Whereas, we all would like to see 

the salmon returned to our lakes and rivers and streams, the mission is not being accomplished and yet the taxpayers are putting 

out enormous amounts of money. 

We are becoming increasingly impatient about that. I-Mr. 

Chairman, I would ask for just two more minutes and then I have 

to leave. 

Mr. Schmitten, when you were in front of our Committee before 

and then when we had one of your representatives, Mr. Bellmore, 

in front of our Committee, I asked about a rancher who isn't even 

adjacent to a stream or a river where salmon had historically been 

present. His water rights were taken, as far as his ability to use 

his water rights, the Yantash Ditch project. 

I have asked and asked and asked. You have assured me a response on this. And, it has not been forthcoming. 

Mr. Bellmore referred me a response on this. It is important to 

Idaho to know where your stand is on appropriated water rights. 

And, so I would again urge, in front of this Committee, that we 

begin to work together and that I would like to see the response 

that has been promised by you to this Committee, not just on that 

issue, I mean that particular case, but because your agency's activities have interfered with appropriated water rights. And, then--

Mr. SCHMITTEN. May I answer that? I think I have a good answer for you. 

Ms. CHENOWETH. Sure. Yes. I have one more question to Mr. 

Robertson, but--

Mr. SCHMITTEN. OK. I reviewed the Yantash Ditch because we've 

talked about it. And, each issue that you and I have discussed, I 

think we have worked to a resolution that we are both happy with. 

Ms. CHENOWETH. That's not the case. And, I know you are back 

here in Washington, D.C. 

But, we could spend all of my time and yours, too, talking about 

that one case. But, I would like to work with you in private on it. 

Mr. SCHMITTEN. We reached an agreement with the landowner 

in the Yantash Ditch. The flows that he requested are the flows 

that we will have in our consultation. 

I think it's something that all the parties are pleased with. And, 

I wanted to announce that to you today. 

Ms. CHENOWETH. Thank you. There still is a problem with the 

acceptance of the Weir, so we are not through this problem yet. 

But, Mr. Robertson, I did have a quick statement to you. And, 

then I wanted to ask you a question. 

You mentioned the religious issue that the tribes have expressed. 

And, whereas, I believe all people in America should be free to worship as they please, the First Amendment of the Constitution, you 

know, guards the government against and prevents the government from any establishment of religion, a government religion. 

And, when we see government agency heads talking about this, 

we are getting perilously close to the establishment of a religion 
44 

and tax dollars going to further the programs of people who want 

to engage in an object of worship. Conservation is one thing. 

And, object of worship, we are getting perilously close to danger. 

And, when children cannot have--or students cannot have prayers 

in school or they may not even have their baccalaureate service 

where there is no administrative activity, they may not have their 

own prayers at baccalaureate, then, I think that we need to guard 

against that. And, I have spoken out on that issue. I will continue 

to, because I don't think tax dollars should go to support a religious 

practice. 

You have been around for quite awhile. You have a good reputation. 

But, I remember when the Northwest Power Act came into being. Did you ever envision that the Act itself would be so tipped toward 

the mitigation enhancement of fish and wildlife and tipped away 

from your agency being able to provide a constant and low cost 

source of power to the users up in the northwest? 

Mr. ROBERTSON. Well, Mrs. Chenoweth, I would just say a couple 

of quick things. One is that I certainly didn't mean to bring government closer to involving itself in the religious question in response 

to your first point. 

Ms. CHENOWETH. Thank you. 

Mr. ROBERTSON. I was trying to make a point about how emotionally important salmon are to the northwest generally and, of 

course, specifically to the ceremony of some religions. But, that was 

really the only point. 

The point you make about the Act is that Bonneville has to balance its purposes, just like the Corps has balances in its mission, 

and others do, as well. And, fundamentally, the Act was driven by 

what was perceived to be an energy shortage at the time, and to 

assure low cost electric energy for the northwest. 

But, it did introduce the issue of mitigation directly for damage 

done to fish and wildlife by the hydroelectric system. Now, as to your point, the energy market has changed radically 

since 1980. It has almost turned on its head. Now low cost energy 

is the course of the day and Bonneville is in competition to meet 

that market. 

And, that was not true in 1980. So, to deliver our mission, we 

have to balance all of our costs, including fish and wildlife. And, to sum up quickly, because I know your time is short, I 

would honestly say the amount of fish and wildlife we are paying 

for right now is larger than I would have imagined. I think it's 

larger than most people would have imagined in 1980. On the 

other hand, given the arrangement we put together last year with 

the Administration for the 10 year stability of our fish and wildlife 

costs, we think we can manage our mission, sell low cost power to 

the northwest and continue to meet the obligations for fish and 

wildlife and other public purposes. And, a number of your constituents in Idaho, I hope, will sign up 

for that power shortly. Ms. CHENOWETH. Thank you, Mr. Robertson. 

Mr. POMBO. Mr. Hastings. 

Mr. HASTINGS. Thank you, Mr. Chairman. Mr. Robertson, I want 

to clarify a few of the statements that you made in response to 
45 

questions from Mr. Miller and Mr. DeFazio so I can understand 

this also. 

You have-you say there is a cost of roughly $435 million in 

costs. Part of it is direct and part of it is from foregone lost of revenues. 

And, you conceded, I think if I heard you correctly, to Mr. 

DeFazio that part of the foregone revenues is, in part, because of 

the Northwest Power Planning Council and in part to ESA. You 

haven't broken that out apparently? 

Mr. ROBERTSON. We have. There is-of the $435, there are two 

big categories. 

Mr. HASTINGS. Right. That's--

Mr. ROBERTSON. One is direct costs, which are $252 and then the 

$183, both foregone revenues and--

Mr. HASTINGS. I'm talking about that $183. 

Mr. ROBERTSON. Right. 

Mr. HASTINGS. And, you conceded to Mr. DeFazio that part of 

that could be attributed to theMr. ROBERTSON. Yes. 

Mr. HASTINGS. [continuing]-Northwest Power and the ESA. 

Have you broken out-because of how the Northwest Power Planning Act is written and ESA, have you broken that out, the difference? 

Mr. ROBERTSON. It's difficult to do that breakout because of the 

integration of the hydro system and the overlap of those two responsibilities. We did start, I think, responding to the biological 

opinion and changing river operations in 1992 in response to the 

listings that were mentioned earlier by Mr. Schmitten. And, that did begin to change the hydro system. And, the Northwest Power Planning Council came along with that and made its 

recommendations as well. 

Under the Northwest Power Planning Act, we are to act consistent with the Council's recommendations. And, the standard under 

the Endangered Species Act is, I think, legally somewhat higher. [The following was received in reference to the above:] 

BONNEVILLE POWER ADMINISTRATION'S EXPECTED ANNUAL FISH AND WILDLIFE 

COSTS TO THE FEDERAL COLUMBIA RIVER POWER SYSTEM 

Bonneville is able to estimate the amount of energy lost at the mid-Columbia 

projects as a result of operations for fish and wildlife with computer models. However, th,e ability to identify foregone revenues separately from additional power purchases \the two components of total net costs) is dependent upon knowledge of the affected utility's energy loads relative to its energy resources. Thus Bonneville can make the differentiation for itself, but is not able to do so for other utilities. This 

task can best be accomplished by the affected utility itself. At the mid-Columbia 

projects there are more than ten utilities affected. 

Mr. HASTINGS. OK Does that figure include the loss of revenue 

that the Big Columbia PODs would have? 

Mr. ROBERTSON. No, it does not. Mr. HASTINGS. Any estimate of how much that would be? 

Mr. ROBERTSON. (can try to get that for the record. I don't have 

one in front of me. 

Mr. HASTINGS. Just-I know. Get it for the record. But, for the 

record here, make a rough guess and we can amend it later on. 

Roughly, what would you think? 
46 

Mr. ROBERTSON. Of the hydro portion alone? 

Mr. HASTINGS. Yes, hydro only. 

Mr. ROBERTSON. Oh, boy. 

Mr. HASTINGS. Ten percent, 15 percent? 

Mr. ROBERTSON. Maybe that, 15 percent. But, I wouldn't want to 

put it in the record. 

Mr. HASTINGS. OK. Let's just be on the low side. Fifteen percent 

more. So, now we are over $200 million in foregone revenues. There's 

no caps on the Big Columbia PODs, so they don't enjoy what you 

have. Now, the Chairman has been getting very antsy when we go over 

five minutes. And, I don't want to irritate him. Now, the $250 million direct cost, how much-that is different 

now. That is direct cost. How much of that-and Mr. Miller has kind of gone into this a 

bit and then his time ran out and he didn't get to pursue it. And, 

you were going to answer that, I thought. How much of the $250 million direct cost is attributable just to 

ESA? And, how much is a mix between that and Northwest Power 

Planning Council? 

And, how much is Northwest Power Planning Council? How do 

you break that down? 

Mr. ROBERTSON. The way we broke that out for the Committee 

was that $57 million of direct program expense and approximately $13 million in capital were related to the Endangered Species Act, 

in addition to the $190 or so million related to foregone revenues 

and power purchases. Mr. HASTING~ , So, you are looking at roughly-my figure then is 

roughly 70-about 25 percent roughly, a little bit more than 25 

percent, of the direct cost is attributed to ESA? 

Mr. ROBERTSON. That's what we've done for the Committee. 

Mr. HASTINGS. Now, does this figure include the Big Columbia 

PODs? 

Mr. ROBERTSON. No. 

Mr. HASTINGS. So, the Big Columbia PODs, then, is another cost. 

And, if 15 percent-! don't want to hold you to the 15/ercent. 

But, if it's true on foregone revenues, that shoul be probably 

pretty close to what direct costs would be. I know, for example, 

that the Big Columbia PODs, everyone of them, are doing a fish 

bypass system, which is because they think it's good policy. I see the Corps of Engineers is just starting to do that on one 

of the dams, on the Snake River. I don't know if you are doing it 

on other dams. 

But, these are the type of costs that are direct costs that are attributed to ESA. Is that a fair statement? 

Mr. ROBERTSON. If you are talking-! would like for Mid-Columbia PUDs to speak for themselves, but they have made changes. In 

fact, in some cases, they have made changes that we are trying to 

replicate on the main stem, because we think they may be highly 

beneficial to fish and bypass operations. 

And, they have experienced those costs under their licenses. Mr. HASTINGS. OK. General? 

Maj.Gen. GENEGA. I believe that's an accurate statement, sir. 
47 

Mr. HASTINGS. OK. How many dams have you tried these fish 

bypass systems on? 

Maj.Gen. GENEGA. Sir, we have fish bypass systems on probably 

close to half our dams across the--

Mr. HAsTINGS. I'm talking about the surface collectors, which is 

a newer technology. 

Maj.Gen. GENEGA. Yes, sir. We are just getting into the surface 

technology business literally within the last year or year and a 

half. 

Mr. HASTINGS. It's interesting that the Big Columbia PODs on 

the five dams they have, they have three surface collectors that I 

am aware of right off the bat. OK. 

One last thing. I know this is-because of these costs, these are 

spread out over the ratepayers. 

Do you have--have you broken this down to what it costs, say, 

an average resident, the irrigators, the DSis, what impact that has 

had of these costs you are talking about, the full $435 million? 

Mr. ROBERTSON. The $435 million represents, in simple terms, 

about 20-22 cents on every dollar generated by sales of power go 

toward fish and wildlife mitigation. So, basically, if you are buying 

Bonneville power, 22 cents of the power dollar you pay is going for 

fish and wildlife mitigation. 

Mr. HASTINGS. And, finally, Mr. Chairman, I will just make 

one-the fact that I brought up the Big Columbia PODs and Mr. 

Robertson obviously couldn't accurately estimate what theircosts 

are, that ought to be in the record. And, I would like to have t)nanimous consent to add that to the record in addition to this testimony 

so that we can put it in there to reflect the true costs there on the 

Columbia River. 

Mr. POMBO. Without objection. 

Mr. MILLER. Mr. Chairman, if I might just have a couple of seconds here to make a statement. 

Mr. POMBO. You are given two seconds. 

Mr. MILLER. Your generosity overwhelms me. [Laughter.] 

Mr. MILLER. I think this has been a very important panel, because my impression is that we are looking at the Department of 

Defense, a subsection here of the Corps of Engineers, the Forest 

Service; and, not represented at the table, but the Bureau of Reclamation; and, the Bonneville Power Administration, all of whom 

got their charters a long time ago when the world was very different. And, what they are now are multi-purpose agencies. 

Secretary Goodman said that, in fact, the mission is much more 

encompassing now than maybe we traditionally thought of it. 

Those of us who are struggling with base closures and cleanup, as 

you are within your budget, recognize the horrible decisions that 

were made many, many years ago when we were ignorant about 

the ramifications of those decisions and the costs of cleaning those 

up. 

More and more of the military construction budget is going back 

to clean those up, as opposed to providing housing and services for 

our personnel. 

You had one charge at the outset of Bonneville Power-regulate 

that river, develop the power and try to develop some navigation . 
48 

The Central Valley Project, up until a few years ago, was really not 

a multi-purpose agency. It was water delivery to one constituency, 

the State Water Project in California. 

These are not sins. This is the way we looked at the world in the 

50's· and the 60's. 

The Corps of Engineers, I came to office arguing with you. A year 

and a half ago or two years ago, on a bipartisan basis with business, labor and environmentalists, we came up with a dredging 

plan for San Francisco Bay, because we all do business different 

today than we did before. 

And, all of these agencies were involved. It used to be about how 

many board feet you could get to market-the only question asked. 

But, the fact of the matter is, all of those single-purpose missions 

would be unacceptable today if you never had the Endangered Species Act. The people in the northwest are not going to stand for the 

eradication of their forests. 

We are not going to stand for the eradication of the delta environment. And, it goes on and on and on. 

And, I think the purpose here is we can argue over whether or 

not the Secretary of the Interior was precise. But, the mission is 

somewhat more imprecise. 

And, the mission is a lot about learning as we go along. And, 

budgets do jump as listings take place and we find ways to avoid 

them-habitat conservation areas and other arrangements such as 

that. 

And, I think this has been very instructive, because whether or 

not we are going to use the Secretary's statement to try to impeach 

the Endangered Species Act or get rid of the Endangered Species 

Act or whatever the options are, the fact of the matter is that what 

we know is that the American public supports it overwhelmingly 

because they've seen an improvement and a diversity brought to 

their communities that maybe they, in fact, weren't even aware of 

before. 

It's certainly reflected in the northwest and certainly reflected in 

California where we now have many competing interests and a lot 

more people not only that are entitled to, but you can't keep them 

from the table where these decisions are being made. Years ago, hell, on this Committee you didn't have anybody west of the Mississippi. 

And, the decisions were made in the 17 western states, as they 

used to start every speech in this Committee. Today, Mr. Markey 

is from Boston. And, it goes right on down the road, because other 

people want say in how we develop and how we administer the 

public lands and resources. 

And, so, you know, you are caught in a transition. It has been 

a long transition since endangered species, since the environmental 

movement, since the Earth Day at the beginning of the 70's. 

But, the fact is, that's where the Nation is going. And, all of your 

agencies have recognized this. Now, we can beat up on you until the cows come home. But, the 

fact of the matter is that that's where the Nation is going. 

It is about the protection and the enhancement of the resources 

of this country. And, that doesn't preclude the utilization. 
49 

And, that doesn't preclude the commercial exploitation. And, I 

mean exploitation in the sense of activity, not in derogatory terms. 

That can all be done. But, it's done when you put together forest 

plans or you put together dredging plans and you no longer just 

say, "How big a ship are we bringing in here." You have got to 

know a lot of other things and take a lot of other views from city 

councils and boards of supervisors and water agencies and all the 

rest of them. 

And, I think that's what this panel has illustrated. We can talk 

about costs but, you know, in California we spent almost more than 

$1.5 billion just building the San Luis unit. They have paid back 

$60 million. 

Nobody asked what was the cost. But, now when all of a sudden 

we want to talk about some multi uses and protecting the environment and doing some other things, we are absorbed with costs. Nobody has asked those navigators on the river how much they 

could pay in fees. We know that's all subsidized, whether it's on the 

Columbia or the Mississippi or the Hudson or anywhere else. 

And, nobody is asking people to pay back all that money for 

those dredgings. But, if we dredge, we make a decision because 

somebody wants to protect the environment and all of a sudden we 

become very cost conscious. 

And, I think the realism of the administration of your agencies 

is that it comes-you know, the incoming is coming from everywhere. You get it from everywhere when you go to make decisions. 

That's a kind of democracy. And, there is a cost associated with 

that. 

And, there is a whole array of values out there about the environment or about economic activity or what have. And, those today 

have to be taken into consideration. 

You didn't have to take them into consideration when I first 

came to this Congress. You didn't have to take them into consideration when you were building the Central Valley Project or the 

Central Utah Project. 

But, you know when we changed the Central Utah Project? Because the people in Utah overwhelmingly voted to change it, not 

because the Congress voted but the people in Utah changed. 

Why are we changing the project in Arizona? Because the old 

way went bankrupt and the state has changed. And, tourism looks 

a lot more attractive and retirement developments. 

What's going on in Nevada? Ten percent of the water generates 

90 percent of the jobs. Ninety percent of the water generates 10 

percent of the jobs. That equation won't hold up in a modern society. 

So, these are changes. And, the environment gets taken into consideration. 

I want to thank you very much for your participation, because 

I think you gave us a real looking glass into the kinds of decisions 

and the kinds of constituencies that we would demand you respond 

to, because there are local constituents. Thev wear a lot of different 

hats, but they come from the areas that we represent. 

And, I want to thank you very much for your participation on 

this panel. Thank you, Mr. Chairman, for the extra time. 
50 

Mr. POMBO. You are welcome. Well, I, too, want to thank you for 

your testimony and for your answering the questions that were 

presented to you in the best that you were able to. 

And, I think George is right about one thing. And, so maybe this 

is a looking glass. Maybe this does open people's eyes a little bit. 

You know, the statement that the Secretary made referred toby, I believe what Ms. Beattie said, referred to one small part of 

Fish and Wildlife's budget. And, that was what he was saying was 

16 cents per person. 

But, when you look into the looking glass, you see that that is 

just one small part of your budget, which is one small part of the 

Interior budget, which is one very small part of the Federal budget, 

which reflected by all of you sitting there adds up to a considerable 

amount of money and a considerable amount of bureaucracy, a considerable amount of people that are involved. 

When I have people in my district that want to plant grapes, 

they have to go to the Army Corps of Engineers to get pennission 

to plant grapes on their property, who has to go through Fish and 

Wildlife to find out whether or not there is endangered species on 

that property. And, the Bureau of Reclamation is involved because 

of water issues that come in. 

And, pretty soon, everybody that is sitting at that table, with the 

exception of Bonneville, who would love to sell power down my 

way, but with the exception of them, everybody there is involved 

one way or another. And, you know, when you get into an issue 

like endangered species, it involves all of the Federal agencies and 

it involves money from all of the Federal agencies. And, what you bring to us is a very small part of the overall cost. The ~verall cost of the Endangered Species Act is many, many time~ the cost to the taxpayer, the cost that you spend through 

your agencies. 

Mr. Dooley, in his questions and in his opening statement, pointed out that the cost to local government and private property owners is many times what even you spend. So, you know, there is a 

lot involved with all of this. I would like to ask Ms. Beattie, if I may, ask you a question. We 

started with a list of candidate species of over 4,000 species. And, 

I don't have this in front of me right now, so I'm paraphrasing it. But, I recently read a press release or a statement that came out 

of, I believe, your agency that said that after intensive research 

and investigation, you had narrowed that down to 243 species that 

were going to be put on the list or that were proposed to put on 

the list. Did you peer review all 4,000 some odd species to determine whether or not the science you had used was accurate? 

Ms. BEATIIE. Mr. Chainnan, we kept two tiers, basically two file 

cabinets, of candidate species. People write into us and say-you 

know, people, usually scientists, write into us and say, "We think 

such and such is declining." 

If we can find some information, some backup to that, that indicates this is worth looking at from a scientific point of view, good 

scientific infonnation, we will--or, we don't-let's start with we 

don't, we used to call it a Candidate 2. You know, we basically 

saved the letter. 
51 

And, we had a Level 2, which was the other file cabinet. And, 

we would put it in there and see if it-if something showed up in 

the future and maybe we would have some information that we 

kept on file. 

We decided that this probably wasn't the most efficient system, 

keeping these two file cabinets and what we really-with our 

scarce resources, we really need to be focusing on that Number 1 

drawer, making candidate conservation agreements with people 

and try to keep those off the list. Those are the ones with a good 

foundation of scientific evidence showing that the allegations about 

declining populations are true. 

Mr. POMBO. So, are those-the ones in--

Ms. BEA'ITIE. We got rid of--

Mr. POMBO. [continuing]-Category 1, were those peer reviewed? 

Ms. BEA'ITIE. Those will be peer reviewed if they are listed. We 

do ask scientists about them, yes. 

We ask for scientific information on whether people have found, 

whether researchers have found--

Mr. POMBO. So, people have submitted scientific evidence to Fish 

and Wildlife and--

Ms. BEA'ITIE. For Candidate ls so that--

Mr. POMBO. For Candidate 1. 

Ms. BEA'ITIE. Right. Basically, what--

Mr. POMBO. Has anybody other than the scientist who prepared 

that outside of Fish and Wildlife looked at and determined whether 

or not it was accurate? 

Ms. BEA'ITIE. On Candidate 1? 

Mr. POMBO. Yes. 

Ms. BEATTIE. How do we-do we gather up-the answer is yes. 

We get input from the states, input from any scientists who happen 

to know this species and look to see if there is a critical mass of 

information that says good scientific information and consensus 

that says, "Yeah, we think there is some concern over this species." 

We call it a Candidate 1. 

Mr. POMBO. You and I need to taik about this. 

Ms. BEATTIE. OK. 

Mr. POMBO. And, I won't put you through this right now at a 

hearing. But, you and I ~·eally do need to sit down and talk about 

this, because what you are telling me is totally contradictory to 

what I believe is actually happening. 

So, we do need to talk about this, because the---in order for you 

to do what you just said you are doing, I do not believe you have 

the budget nor do you have the manpower to achieve what you just 

said you were doing--

Ms. BEATTIE. Well, as I--

Mr. POMBO. [continuing]-because we are talking about several 

thousand species. And, if you narrow this down to 243, you are 

claiming that you did all the scientific data on these and going 

down to the 243 you are saying that you have the 243 ready to go. 

Ms. BEA'ITIE. Mr. Chairman, let me state it differently. On the 

Category 2s, we simply decided that it was not efficient use of our 

time and money to be keeping track of them, because we don't 

have--
52 

Mr. POMBO. And, what percentage of the total 4,100 or whatever 

is Category 2? Half? 

Ms. BEATTIE. Three thousand eight hundred. And, on Category 

1, I'm saying that we are not launching a research project out of 

the Fish and Wildlife Service. We don't do that pretty much in any 

case. 

We rely on--

Mr. POMBO. So, the 243 are not exactly ready to go, because you 

have not done all the scientific data to verify that they are endangered or threatened? 

Ms. BEATTIE. They-those 243 are proposed for listing. That's not 

the whole list of candidate species. 

Mr. POMBO. I know. The whole list is 4,000 something. Ms. BEATTIE. No, no. The whole list-we just got rid of 3,800 off 

that list, because we decided it wasn't efficient use of our time. 

Mr. POMBO. Well, how many do you have on the candidate list 

now? 

Ms. BEATTIE. One hundred eighty-two. 

Mr. POMBO. Where did the 243 number come from? 

Ms. BEATTIE. That's-those are the species that were proposed 

for listing when the moratorium came on, that were ready to go 

through the listing process when the moratorium was imposed. 

Mr. POMBO. So, that's why there's two different numbers that 

have been released? 

Ms. BEATTIE. Right. 

Mr. POMBO. So, you have 243 plus 184? 

Ms. BEATTIE. No, 183, something like that. 

Mr. POMBO. Whatever. 

Ms. BEATTIE. Yes. But, the candidate species, Mr. Chairman, are 

treated very differently. 

At the time, we-I should also say that we don't do primary research. We rely on scientists who are known to have an interest 

in the species. We rely on peer reviewed literature, etcetera. 

We are not launching a research project on 183 species of our 

own, using our own--

Mr. POMBO. That's a big part of the problem with the way the 

current Act is working, is that right there, because you allow the 

ability of someone with a vested interest in a species being listed 

to be the one who puts up the information. And, I do not believe 

it's being accurately peer reviewed nor is it being accurately challenged, in that there are things that end up on the list or the candidate list. 

And, the candidate list is very important, because a lot of the 

things that you've talked about, that Mr. Saxton has talked about, 

would afford endangered species protection to those which are on 

the candidate list, because now we are talking about keeping them 

from becoming threatened or endangered so we are going to begin 

to afford protection to species which have not gone through the listing process or that vetting process. Even the very limited amount 

of peer review that you actually do, those species are even before 

that. 

And, now we are talking about affording some type of protection 

to those. So, that candidate list is extremely important in what is 

on there. 
53 

So, in-I mean, I didn't want to get into all of this. But, what 

you are saying is important. 

Mr. MILLER. Mr. Chairman--

Ms. BEATTIE. Mr. Chairman, I mean, it strikes us as sort of eminently sensible, since we've sat here and talked about costs all day, 

to try and put some effort into prevention. 

Mr. POMBO. Oh, I agree with you. And, if you would read my bill, 

you would understand that I do agree with that and that that is 

important. 

Mr. Miller. Mr. MILLER. One of the-it may be related to this, but it's a concern that has been raised among my constituents in some cases, is 

the suggestion-and I don't know the accuracy of it, but the suggestion is that this process builds on itself. Somebody makes a recommendation. You take a look at this. You talk to other people who 

know about it. And, you get a list of concerns saying, "Yeah, we think that this 

is a viable candidate." But, if you don't think that, maybe the door 

isn't as wide open for those who might-you know, the scientists 

who might think otherwise or other interested parties would, however you would want to classify them. 

So, then, because there is sort of a-let's say, a positive file saying this should be a candidate or seriously considered or whatever, 

that that sort of stays on there. And, then all of a sudden, the 

Corps and others start moving in a direction that suggests they 

have got to take some actions with respect to a project or what 

have you, because this is a candidate. 

But, what we really don't know, at that same time, is whether 

or not there is a body of evidence that suggests that is not the case, 

the suggestion being there is sort of not an affirmative call for evidence to the contrary. 

Ms. BEATTIE. In terms of the candidate list? 

Mr. MILLER Yeah. And, then all of a sudden, restrictions and actions start t1owing from the notion, "Well, we have an obligation, 

because this is really a strong candidate." 

But, maybe that's not the case. That's the suggestion. I don't 

know if it's accurate or not. 

Ms. BEATTIE. In terms of our peer review process, generally it is 

as thorough as we can make it. And, we do call for opposing opinions. 

And, I could cite, for instance, in California a-I wish I could remember the name of the fish, but a dart or whatever was rejected 

under opposing opinions because some said that there were other 

populations. 

Mr. MILLER. Is that the ordinary-excuse me for taking your 

time, but is that the ordinary course of, you know, the method of 

operation here? 

Ms. BEATTIE. It certainly is in the listing process. And, I'm going 

to ask somebody behind me to kick me in terms of the candidate 

process. I'm not as familiar with it. 

I can tell you, however, that I believe everybody seated to my left 

or their organizations have signed a cooperative agreement on candidate conservation. That has worked very well in terms of doing 

that. 
54 

It doesn't address your concern about whether or not we are able 

t()-because we actually go to work on candidates, which is the 

point you are making, whether we do thereby stifle or not invite 

opposing opinions. 

Mr. POMBO. Reclaiming my time, I think that that's part of the 

danger of what you are talking about. And, that is-I mean, this 

is not a quick fix. This is not an administrative fix. This is not 

something that you can, you know, wave an executive order over 

and change. 

But, to do what you are really talking about doing requires a bill 

like H.R. 2275 to accomplish. And, I realize that there are things 

in there that you don't like and that we will disagree on. 

But, it requires that kind of a fundamental change in order to 

achieve what you are talking about doing. I mean, all the things 

that you have brought up and that this panel has brought up are 

the same things that we battled with in trying to come up with a 

way to make the Endangered Species Act work. It's the problems that people have brought up, that our constituents have brought up to us over the past several/ears. It's all of 

these things that fundamentally have to be change . Money is a big part of this whole equation. And, in our bill, we 

put more money into it, because we know that you are going to 

have to spend the money in order to do that. And, the question is going to be whether or not we can make this 

thing work so it has the fundamental support of those that are 

being regulated so that we can go in and say this is a worthwhile 

project that needs to be funded. Ms. BEATTIE. Congressman, to the change in the review of the 

peer review of--excuse me. The change in the peer review of candidate species could be done administratively. 

Mr. POMBO. Well--

Ms. BEATTIE. We wouldn't need a--

Mr. POMBO. [continuing)-! would argue with you that what you 

are doing administratively is not peer review. It is better than 

what was being done, but it is not a true peer review nor is it an 

accurate way of determining whether or not the science you are 

using-! mean, when we sat down and tried to draft peer review 

language, I spent a lot of time with people in the Administration 

who are scientists asking them what is an accurate way to peer review this kind of science. 

And, that's what we tried to reflect. And, I don't believe that 

what is currently happening could honestly be called peer review, 

in the same respect that these scientists told me, "This is what 

should be done to determine whether or not that's good science." 

I mean, I am way over time. And, I would like to talk to you 

about that. 

Ms. BEATTIE. I would be happy to. 

Mr. POMBO. When you-I'm glad to see you here. And, when 

you've got an opportunity, I would like to do that. And, to the rest of the panel, thank you very much for taking the 

time to come in and testify. I would like to call up the second panel. I apologize for the length 

of the hearing up to this point, but it is an extremely important 

topic. 
55 

If the second panel would come forward. If you would take your 

seats, we could get started. 

I want to apologize for the lengthy first panel. I do appreciate 

you being here. And, I appreciate you sticking around. 

So, if you would like to start, the floor is yours, Mr. Mazour. 

STATEMENT OF DAVID F. MAZOUR, CO-CHAIR, ESA TASK 

FORCE, NATIONAL WATER RESOURCES ASSOCIATION; ACCOMPANIED BY WILLIAM T. PITTS 

Mr. MAZOUR. Thank you, Mr. Chairman. My name is Dave 

Mazour. I am with the Central Nebraska Public Power and Irrigation District. 

And, behind me is Tom Pitts, with the Colorado Water Congress. 

And, we appreciate the chance and the opportunity to come here 

before you and testify on behalf of the National Water Resources 

Association. 

Tom and I are members of the Association's Endangered Species 

Act Task Force. We are co-chairs. 

And, NWRA, as you probably realize, represents 17 western 

states and water users in those 17 western states. Our members 

provide water for municipal, industrial and agricultural purposes. 

Our members seek to do that in an efficient and environmentally 

sound way. 

Now, National Water Resources Association supports the goal of 

the Endangered Species Act. We feel that conservation and protection of wildlife species and, in particular, endangered species is a 

very worthwhile national goal. 

We also feel that cost effectiveness and sound science are fundamental to the protection and a long-term enduring program. Unfortunately, we are seeing in our areas that people are losing confidence in the Act and, in particular, the way it's being implemented. 

Some of our members have been saddled with Endangered Species Act requirements that are costing millions of dollars that are 

providing little or marginal benefits. We feel that the root cause of 

this problem is that all Federal actions are subordinated to the Endangered Species Act. 

That involves Federal permits, Federal licenses which our particular district is going through, loans and, yes, even the operation 

of Federal dams. Operational plans are subject to Section 7 consultation. 

It seems that the Endangered Species Act has given absolute 

power to the Fish and Wildlife Service and to Marine Fisheries. We 

find that it does not require some of the balancing of Federal responsibilities. 

It doesn't require the application of sound science. And, most of 

all, it does not require the consideration of economic or environmental impacts. 

We feel that really the American people and Congress are faced 

really with two choices. We can have an Endangered Species Act 

that is positive and constructive and one that permits economic activity to proceed in compliance and also with protection of threatened and endangered species or we can see one, on the other hand, 
56 

that impedes and thwarts the economic activity and puts a great 

burden of cost on our citizens with little or no benefit. 

And, it's our perception that the latter of those two is what is 

happening right now. In the testimony that I have provided in advance, there are some 

examples from six states of specific examples of ESA requirements 

and the costs associated with those. When the question was raised 

by Chairman Young on costs, Tom Pitts, my co-chair, did some 

quick arithmetic to try and tabulate those costs. And, we come up 

with a number of annual costs from those examples in those six 

states, and they don't include everything, but $800 million per 

year. 

Capital costs are between $300 and $1.3 billion. I think there are 

two points from those examples. And, I can speak to those in Nebraska, but I cannot speak to 

those very well in the other states. But, there are two points that 

I think would be raised when you look at those. 

First of all, the costs are extremely, extremely high. And, secondly, the benefits, in many cases, are questionable. 

And, what are we getting for the dollars that are spent? It seems 

that in Nebraska, in those two examples that I cited, because we 

are using recommendations of the Fish and Wildlife Service rather 

than subjecting the recommendations to a more thorough scientific 

scrutiny, we are getting less benefit for the habitat, less benefit for 

the species at a greater cost. 

The districts have tried some things on an experimental basis for 

the protection of terns and plovers. Our work and our proposals 

work better, costs less, produce more for the species. But, yet they 

are resisted by the Fish and Wildlife Service. 

In summary, I would like to say that the Endangered Species 

Act, we believe, can be rewritten in a way. The House bill is an 

extremely good bill. 

We feel that changes in the Act need to address it from an institutional way so that institutionally it will facilitate good, sound decisions and the development of reasonable decisions that are based 

on strong science and find ways to institutionally change the bill 

so that it will promote cost-effective measures for the protection of 

the species. Currently, we don't feel that's occurring right now. 

And, we would encourage this Committee to proceed with enactment of the ESA reform bill. Thank you very much. 

[Statement of Mr. Mazour and Mr. Pitts may be found at end of 

hearing.] 

Mr. POMBO. Thank you. Mr. Hunter. 

STATEMENT OF JOE HUNTER, EXECUTIVE DIRECTOR, COLORADO RIVER ENERGY DISTRIBUTORS ASSOCIATION, SALT 

LAKE CITY, UTAH. 

Mr. HUNTER. Thank you, Mr. Chairman. I would ask that my entire statement be submitted for the record. And, I will, in the interest of time, try to dramatically summarize here. The Colorado River Energy Distributors Association represents 

more than 100 consumer-owned electric systems in Arizona, Colorado, Nevada, New Mexico, Utah and Wyoming. Combined, these 
57 

members distribute more than 80 percent of the electricity generated by the Colorado River Storage Project. 

That project consists essentially of five Federal dams in the 

Upper Colorado River basin and the associated generators, transmission, et cetera. 

As was discussed with the first panel, the implementation of the 

Endangered Species Act affects hydro power really in a couple of 

ways. The first way, which is perhaps the most easily identified, 

is when the Federal agencies-in our case, the Bureau of Reclamation-engage in Endangered Species Act research activities, recovery planning, et cetera, and ascribe those costs to their own budgets. 

In fact, to the extent they are deemed part of the operation of 

the project, those costs are recouped primarily through the sale of 

power. In the case of the Colorado River Storage Project, power 

sales cover all of the costs of generating power, a portion of the 

joint costs and in excess of 90 percent of the costs of irrigation. 

So, in essence, if the project incurs a cost in the name of endangered species recovery, protection, whatever, it finds its way, by 

law, into the rates that the people I represent pay for power and, 

more importantly, their consumers. So, you do have those direct 

costs. 

The far more ominous costs, from our standpoint-and, again, 

you heard some of this in the discussion with the folks from Bonneville this morning-are the costs of lost generation. The most popular and most attractive option quite often, when we are talking 

about fishes, as we are usually in the Colorado River, is to re-operate the dams, to alter the way they are operated from historic operations to provide specific flows at specific times for the species. 

Given the way most western river basins are operated, and particularly the Colorado River, whenever you make those kinds of 

changes, you will have an impact on the value and, in most cases, 

the amount of hydro power that is produced. There are very real 

costs attached to those changes. 

And, in our case, particularly in the Colorado River, we frankly 

have very little input as to how those changes are made. We wait 

to see what the process produces in terms of an operational 

scheme. And, then we incur the cost. 

I will give you a couple of examples. Right now, at Flaming 

Gorge Dam in northern Utah, which is part of the Colorado River 

system, the dam has been operated for the past several years essentially for the benefit of four endangered fishes. 

There is a program called the Recovery Implementation Program 

for endangered fishes of the Colorado River. So, we have a hydroelectric dam that essentially has been operated for the benefit of 

those fishes. 

First of all, we had to do several years of research to test various 

flows in order to prepare the biological opinion under which the 

dam would then be operated. The annual cost-and I have these 

numbers in my testimony-for that activity was about $5 million 

a year, the economic cost. 

Then, we ended up with a biological opinion, which dictated the 

flows we are now operating under. The annual estimated cost of 

those flows will be about $2 million a year. 
58 

And, as I point out in my written testimony, 11 years and $45 

million later, we still don't know how Flaming Gorge Dam is going 

to be operated in the future and what those costs will be. 

Another example can be found at Glen Canyon Dam. A lot of you 

saw the publicity, I'm sure, related to the recent spike flow there. 

I want to make it very clear that what I'm talking about right 

now is not that spike flow. What I am talking about are changes 

in the operation of Glen Canyon Dam that have been called for 

under a biological opinion that would require five years of research 

flows, that would essentially flatten the river according to season 

for the benefit, specifically, of the endangered fish. 

This is separate and apart from the changes we've already undertaken at Glen Canyon Dam for other environmental values, including the spike flow that you saw a coufle of weeks ago. Again, 

it's in my testimony, but the grand total o five years of such flows 

would be roughly $395 million, again costs that would find their 

way directly into the rates our consumers pay for power. 

Thank you, Mr. Chairman. I will be happy to answer any questions. 

[Statement of Mr. Hunter may be found at end of hearing.] 

Mr. POMBO. Thank you. Mr. Stovall. 

STATEMENT OF JOHN F. STOVALL, GENERAL COUNSEL, KERN 

COUNTY WATER AGENCY FOR THE ASSOCIATION OF CALIFORNIA WATER AGENCIES, BAKERSFIELD, CALIFORNIA 

Mr. STOVALL. Yes, Mr. Chairman. Thank you. If you will forgive 

me a personal comment, it's quite a nice place you've got here. 

I haven't heard anyone say that. But, for those of us from outside 

the Beltway, it's a very impressive place you work in and a very 

important task you are engaged in. I appreciate the opportunity to 

be here to discuss these things with you. 

Mr. POMBO. Well, this place is as much yours as it is mine. So, 

enjoy it. 

Mr. STOVALL. It sounds good. It's ours. It's ours. 

I am here on behalf of the Association of California Water Agencies. I am actually counsel for the Kern County Water Agency and 

also the Chairman of the Legal Committee of the State Water Contractors. I am here today because I'm the Chairman of the Endangered Species Work Group for the Association of California Water 

Agencies. 

The main point we would like to make and I think to leave you 

with relates to a statement that has been attributed to Yogi Berra, 

as a lot of statements have. One of his comments was, "It ain't over 

'til it's over." 

I think one of our main problems with the Endangered Species 

Act is you never know what the cost of a project you are engaged 

in is going to be. It really isn't over because the Endangered Species Act and the Federal agencies enforcing that Act can always 

ask for additional costs. In fact, in our area, the Endangered Species Act is often referred to as the mother of all unfunded mandates. 

I think what you've heard today sort of emphasizes that. I've 

quoted a number of different examples of the costs that have been 

imposed on the California Water Agencies in my written testimony, 
59 

so I won't repeat those here but would be glad to answer any questions you might have about them. What I would really like to focus on is this idea that local governments, such as our water agencies, make what we consider to be 

huge investments for the public good in our areas. In the case of 

water agencies, that's water supply projects and flood control 

projects. And, we have this continuing problem that the costs of 

those projects are never fully known, because there is this repetitive kind of process where wildlife agencies come in and ask for 

additional money. It's very difficult for us to deal with, because we 

create a funding structure to fund particular infrastructure improvements-and you line up the ways of paying for that-and 

then along comes another requirement that adds additional costs. 

It's difficult for us to deal with those things. It's even more difficult for our constituents when they may be engaged, for example, 

in family farming, and those costs come along. It's not only difficult if they can't pay those costs, they are forced 

to walk away from a family farm; it becomes a tragedy. 

Yet we are here today seeking ways to break the kind of impasse 

that has developed around ESA reform. What I would like to emphasize is just a few key points. We have set out a number of other 

points in the written testimony, which I won't repeat here. 

The key points I would like to discuss with you are. Number one, 

as important as this hearing is and as appreciative as I'm sure we 

all are of your interests in finding out what these costs are, it is 

reflective in a way of a failure of the system. 

I was up here last year talking to a staffer on the-well, I won't 

identify the staffer-talking about the need for reform. His comment to me-it certainly wasn't anyone on this Committee- was, 

"Well, you can't expect us to legislate based on anecdote." That 

kind of irritated me at the time. But, in thinking about it, I became 

even more irritated, because it struck me: well whose responsibility 

is it really to keep track of these costs? It should be the agencies. 

Rather than the kind of information that we are gathering now 

on the true costs, which are the costs to the public, the costs to 

local governments, of this Act, there should be a systematic way of 

keeping track of those costs. I noticed a fellow from the Corps 

seemed to have a pretty good way of keeping track of the costs that 

he incurred. It seems to me that the Fish and Wildlife Service 

should also keep track of those costs. There should be a record of 

the kinds of demands that they've made onrublic agencies and private persons for compensation in the way o land or money, or pay- ments for trust funds, and the kinds of costs that are incurred in 

attorneys fees and consultants fees, so that those could be then 

scored by the Congressional Budget Office or the Office of Management and Budget so that all of those costs could easily be tracked. I think we would be very surprised at what those costs are. I notice I have run out of time, so I will stop there. If there were one 

thing that came out of this hearing, I would certainly love to see 

that as a systematic way of tracking all of these costs, not just the 

salaries of the enforcer because that's a very minimal part of it. It's 

the impact on the people that the enforcer is dealing with that real- ly is significant here. 

[Statement of Mr. Stovall may be found at end of hearing.] 
60 

Mr. PoMBO. I think that's probably a very good way to put it, in 

that you can't just determine the cost of a program by the salary 

of the enforcer. And, that's a big part of the problem. 

Yes, sir, Mr. Sharp. 

STATEMENT OF SAM SHARP, SUPERVISOR, IMPERIAL COUNTY, 

CALIFORNIA, REPRESENTING SOUTHERN CALIFORNIA ASSOCIATION OF GOVERNMENTS 

Mr. SHARP. Mr. Chairman and honorable Members of Congress, 

I am Sam Sharp, Supervisor of Imperial County, southern California. I am here on behalf of the Southern California Association of 

Governments, SCAG, which is the metropolitan planning organization for a six county region and the largest council of governments 

in the nation. 

I am a member of SCAG's 70 member Regional Council that is 

composed of county supervisors, mayors and city council members 

from the Counties of Los Angeles, Orange, Riverside, Ventura, San 

Bernardino and Imperial. I am a member of the Energy and Environment Committee. 

And, I also represent SCAG as an appointee to the Governor's 

Committee on Biodiversity. And, I also sit as a Federal appointee 

on the Desert Advisory Council. 

I am going to submit written testimony, and I just want to make 

some salient points here and move on. 

The Energy and Environment Committee has devoted a great 

deal of time this past year reviewing the Endangered Species Act 

reauthorization issues. And, Mr. Chairman, I would submit that it 

is a region that is highly supportive of endangered species, but 

working through the committee assignments and finally on to the 

Regional Council, we found that there were multiple problems with 

the Act as it now is presented. 

And, in our review and some testimony that we presented to you 

some months ago, in the Regional Council we had a vote of 57 to 

2 to support our position on reviewing. And, the main issues, of 

course, were on the "take" of private property without just compensation and the peer review. 

We have multiple problems with that, because we, in our own 

area, see abuses that the peers have never addressed in 10 years 

of our endeavor to get them to acknowledge that there is a problem 

with some of their original assessments. 

We have counties, such as Riverside, where they have already 

put away $120 million for the mitigation of one rat, the Stephens' 

Kangaroo rat. And, that's not enough. 

And, they are also faced with multiple other endangered species 

potential. We, in Imperial County, it's a low desert area. Much of 

our area is below sea level, but we also have a tremendous number 

of endangered species, potential. 

And, we see contradictory Federal law right now that keeps these 

species from being able to return, such as the wild horse protection 

which covers the burro and the burro is in direct competition to the 

Big Horn sheep. We see the other species that have the same problem. 
61 

And, so we are hoping in the moratorium period that there are 

going to be some looks at those issues. But, we didn't see anything 

come about that, indeed, would have helped us out on that. 

We believe that a multi-species habitat preservation approach 

should be the way. We find that if you take one potential species 

at a time--in our county alone, when you take out a half a million 

acres of farm ground that is intensively farmed, the Salton Sea 

which is, of course, available to some of the endangered specieswe have 275,000 acres of military. We just-when you take the 

desert tortoise out, that potential area out and the desert protected 

area out, there's nothing left. 

Imperial County has an unemployment rate right at this minute 

of 26 percent. And, it ranges to 33.7 percent. 

We are highly dependent upon recreation to help us with our 

economy. And, we are also-25 percent of our property tax comes 

from mining and geothermal. And, these are being very drastically 

affected by the continuation of desert protection, the endangered 

species and whatever, the next one down the line. 

And, we are extremely apprehensive about our economy. I see I 

am about out of time, but we do have an area that is supportive 

but they have some--as indicated by our vote at SCAG, they have 

some very severe reservations about the program as now presented. 

And, we would certainly like this Committee to review our recommendations, because we will be so highly impacted by the Endangered Species Act. Fifty-eight percent of our private property 

has a potential of being listed under the Endangered Species Act. 

And, that's pretty drastic. 

And, we certainly appreciate you are here today. And, we would 

certainly-we have an open space in conservation element that we 

will send to you and also that just became available today, a document from the Growth Management Institute. 

And, it is the "Bio Life Conservation Economic Development Dialogue for the Southern California Area." And, we will certainly 

make copies and return them to you post haste. 

[Statement of Mr. Sharp may be found at end of hearing.] 

Mr. POMBO. And, I would appreciate that. I would like to have 

a copy of that. 

Mr. Sharp, between you and Mr. Stovall, it's probably two of the 

most impacted areas in the country when it comes to endangered 

species and just the sheer number of species that you have to deal 

with. And, I know that cost has been a major factor in a lot of the 

decisions you've had to make. 

As a local elected government official, you have had to determine 

what your development fees are going to be based upon what the 

costs are to the county of developing. It's my understanding that 

you have had to reflect some of the costs of endangered species in 

the price of new homes, in the price of developing in your area, as 

we have in mine. 

Mr. SHARP. Mr. Chairman, we have to do that. Our county is in 

such bad financial shape that when we, last year, had to turn down 

an immunization program for infants because we did not have the 

match, you can see how drastic our situation is. 

24-936 96-3 
62 

And, endangered species, I'm sorry to say, isn't that high up on 

the list when we have to make that kind of decision. There were 

five supervisors that went out of that meeting crying. 

And, I will tell you. It's not good to be poor. And, when we see 

Riverside with $130 million already invested in one species and our 

entire yearly budget is only $150 million plus the part that we control is $21 million. So, there is not a whole lot there. 

And, it is being passed on to development and the mines. And, 

hopefully, we won't push them out of the region because the expense of operation is getting such that--

Mr. POMBO. But, what you are telling me is it has impactedit has impacted other parts of your budget as well. I understand 

in a county in California, a very small percentage of your budget 

is discretionary. 

In my county, it's about 15 percent that is discretionary. The rest 

of it is Federal or state mandate, how you are going to spend it. 

And, I would imagine that at Imperial that it's not much different than that, because we have similar unemployment rates and 

similar problems. So, I would assume that to be true. 

So, that-the cost of implementing an endangered species program is a mandate from the Federal Government. And, that takes 

away from the discretionary spending that you have. 

Mr. SHARP. You are right. And, Mr. Chair, in our-in the SCAG 

recommendation, we felt that we-as you mentioned, we are really 

on the cutting edge of the endangered species cost, as is Kern 

County. And, we strongly feel that if this is a national priority and 

a state priority that those two entities should be there with their 

checkbook and help us out. 

It's very easy to live in a metropolitan area and be supportive of 

the Endangered Species Act, because there's very little expense 

that is going to be coming out of their pocket. And, if you want to 

become a member, we say, "Bring your pocketbook with you in the 

form of Federal support or state support." 

As you well know, California has endangered species regulations 

that are even tougher than the Federal Act. And, so we really have 

a double whammy. 

Mr. POMBO. In speaking with some of the guys that we are dealing with, the gnatcatcher on the coast, they told me that the private cost was going to approach $1 billion, not the state or local 

government nor the Federal Government but the private cost was 

going to approach $1 billion before they were done. 

And, that would have to be absorbed into that economy in a very, 

very small region of the country. 

Mr. SHARP. We see that. And, I don't have those figures for you, 

Mr. Chairman, but we see it in the small programs that we have 

going. 

We are in the process right now of permitting a regional waste 

by rail project. And, this site is going to be on the footprint of an 

old mine-of a mine that's existing right now. 

So, there is very little additional environmental work that should 

have been necessary. But, we watched-this has been going into 

the sixth year and we are looking at two more years, because one 

government agency won't sign before the other and the other one 

won't sign before that one does. 
63 

And, it just goes on and on. And, in the meantime, this is a facility that is needed by the metropolitan area of Los Angeles. 

And, we are looking forward to using part of that money stream 

to take care of our environmental problems. But, until that happens, we don't have the money. 

Mr. POMBO. Mr. Stovall, in your experience-and something that 

you said made me think of this. If the environmental cost, the endangered species cost, drives up the cost of irrigation water to the 

point where the people that are using it can no longer afford to 

farm, that's not included in any of these costs that we've talked 

about. 

I mean, the actual costs may be very, very small when you look 

at it. But, that person just lost their ranch and all their future income and everything else. 

And, that's not considered in any of these costs. And, quite frankly, we tried to find out what the national costs were on the private 

sector of the Endangered Species Act. 

And, nobody has any idea. 

Mr. STOVALL. I think that's absolutely correct, Mr. Chairman. 

We've had instances. 

I think when you were out to Kern County, there was a fellow 

there who testified about the loss of his farm, as all of these impacts came down on him and finally he just couldn't do it anymore. 

And, it's that kind of tragedy that really isn't accounted for anywhere at this point. 

Mr. POMBO. Your unemployment rates in your area have to be 

in the low 20's. 

Mr. STOVALL. Right. We-in Kern County itself, actually because 

we have a large groundwater basin, we are a little bit under 20. 

But, along the west side of not only Kern County but also the 

neighboring counties, where they have no groundwater basin to 

rely on as a kind of regulating mechanism, those areas were experiencing certainly in the 20's. 

I believe in Coalinga, in that vicinity, in the drought, we had unemployment rates approaching 40 percent. Our fear is that the Endangered Species Act not become a kind of permanent regulatory 

drought that impacts those areas to the same degree. 

Mr. POMBO. And, that is directly attributable to the-I mean, we 

have always had a relatively high unemployment rate in the valley, 

in California. These very large numbers is what we've seen since 

the regulatory drought took effect and we had the problems with 

delivery of irrigation water. 

And, from all of the implications that I've seen, that can be directly attributed to the Endangered Species Act and the way it was 

being implemented. 

Mr. STOVALL. I think our studies have shown that-most of our 

water comes from the Bay Delta. That in a normal year-and I 

don't mean to sound disparaging of the agreement which was 

reached, the Bay Delta Accord, because it saved us a lot of water 

over what the agencies were actually demanding-but, in a normal 

year, we are looking at something around 350,000 to 400,000 acre 

feet of water that are taken out of the water supply from both the 

State Water Project and the Central Valley Project. And, that can 

translate directly into jobs. 
64 

Mr. POMBO. Translates directly into irrigation water for 100,000 

to 150,000 acres of farm land. 

Mr. STOVALL. That's right. 

Mr. POMBO. Mr. Hunter, I believe in your testimony you made 

the comment of the Endangered Species Act takes precedence. Am 

I mistaken that you said that? 

And, I've heard a lot of people say that, that it takes precedence 

over other Federal laws and Federal mandates and the missions of 

Federal agencies. 

Mr. HUNTER. Well, whether it does or not, I don't know. But, it 

certainly is being implemented that way in the Colorado River 

Basin. 

What I was referring to and would emphasize is that there are 

Federal statutes that govern the operation of Federal water 

projects, that identify what the benefits are, who the beneficiaries 

are, how they should be paid for. Our experience in recent years 

has been that riding in with the banner of the Endangered Species 

Act gives the Federal Government, particularly the Fish and Wildlife Service, the opportunity to essentially disrupt those priorities 

and those benefits. And, as I said, we feel as though we have very little, if any, influence on those decisions that are made, even though the impacts, 

as I pointed out, are enormous. Mr. POMBO. Do you feel that with the amount of dollars that you 

are talking about that it's costing the people within your coalition 

that you could do a better job of recovering species than what is 

currently being done? 

Mr. HUNTER. Absolutely. One of the things that we do, CREDA, 

and I know a number of other entities like us do the same, we, in 

fact, employ our own researchers, our own biologists. The stakes 

are that high. 

And, we continually question and recommend alternatives and 

debate the efficacy of some of the actions that are being taken. But, 

if I could take a little bit of liberty here, one of the problems I see, 

particularly as it relates to the use of power revenues-and I suspect it would apply to the use of water revenues as well-is that 

there is no discipline in that budget for the regulators. 

In other words, we are viewed as a bottomless pit of funds. It's 

like, "Well, let's try this this year and see how it works and see 

what happens." And, we end up paying the cost. 

There is no cost to the Federal Government of doing that. And, 

often there is no identifiable cost to anyone else. 

It merely appears a couple of years down the road in your water 

or power rates. And, we would submit that if there were some limitations placed on that kind of activity that we would get better 

science, better recovery programs and probably better results with 

fewer dollars spent. 

Mr. POMBO. So, you believe that there should be some type of 

cost accountability on the regulators? 

Mr. HUNTER. Absolutely. 

Mr. PoMBO. Which, in Mr. Sharp's testimony when he talked 

about compensation of private property rights, that's what it's really all about, is some accountability for the cost of the actions that 

they are taking. I mean, they have openly gone out, as has Kern 
65 

County, and tried to establish an HCP, tried to work out a cooperative agreement that everybody could live under, that if there is no 

cost to the agency whatsoever of what they are demanding, then 

they can demand anything they want because it doesn't cost them 

anything. 

There is no down side to them. Mr. HUNTER. Right. 

Mr. POMBO. And, unfortunately, under the current Act, I believe 

that's what is happening. 

Mr. Mazour, when we talk about western water, there is-to the 

best of my knowledge, there is no one, no district or no one that 

is not operating without some impact from the ESA at this point, 

whether it is in terms of irrigation or whether it's in terms of production of power. For that matter, we have a number of them in 

terms of recreational and commercial uses as well, commercial 

shipping uses. 

Would you have any idea what the direct cost is to the water 

agencies that you represent? Has anybody ever sat down and started saying, "It's costing my district this much and mine this much" 

and just actually gone through and figured out what that cost is? 

Mr. MAzOUR. Well, we really haven't yet. But, in preparation for 

this testimony, our Association asked for some information from 

some of our members. 

And, like I say, we received some responses back from examples 

in six states. And, the numbers get pretty high. 

Now, it's somewhat difficult to tabulate the numbers, because 

there are-and you have spoken to this already. There are substantial numbers that come with the regulatory burden of getting 

through the loans or the permits or whatever that oftentimes don't 

show up. 

And, those are the costs of the consultants, the lawyers, the staff 

time, the experimental studies. And, then those oftentimes never 

show up and you just get to the next part of direct actions hopefully for the purpose of protecting the species. 

And, our experience in Nebraska is that some of those requirements and recommendations of the Federal agencies really don't do 

a very good job of protecting the species. And, they cost an awful 

lot of money. And, other alternatives work better. 

But, in direct answer to your question, we have not tabulated. 

And, I imagine you would find that quite helpful. 

Mr. POMBO. If you do have that opportunity to begin to gather 

that data, I would be interested in that. I'm sure that it would be 

quite an undertaking just to figure it out. 

But, if you do, I would be interested in that. 

Mr. MAZOUR. In about a half an hour, our National Water Resources Association Task Force will be meeting down the street a 

ways. And, we will bring that up and pass on to them the interest 

of you and this Committee in getting some more definite answers 

on that subject. 

Mr. POMBO. The point of this hearing and the reason that we 

started down this track was that there has been a misconception 

or something that was put out that the cost of the Endangered Species Act was very small. And, we've all heard it likened to every-
66 

thing from the cost of buying pizza in Washington, D.C., to the cost 

of one mile of freeway. 

We've heard all of these examples of how much we spend on endangered species. The reality is it's much, much higher than anybody would ever admit. 

And, I think that this hearing has pointed out that it goes in all 

reaches of the Federal Government. And, that is just the tip of the 

iceberg when you actually start getting into what we are spending. 

You know, whether you are a power producing agency and you 

have a $265 million annual cost or whether you are an irrigation 

district that because of a loss of production that it's several hundred million dollars in your region, we are spending a huge amount 

of money. Even by the Federal Government's standards, we are 

spending a huge amount of money in trying to recover species. 

And, quite frankly, we are doing a terrible job of doing it. !-regardless of which side of this issue you are on, everybody-when 

I ask that question, "Could you do a better job with the money that 

is being spent," everybody tells me yes. 

I mean, whether you come from an environmental group, a local 

environmental group, or whether you come from an industry group, 

they all say yes, there's a lot better way to do it. If you are spending your own money, you can figure out a better way to have results. 

And, when we look at changes, that's part of what has to be 

changed, is that the local people have to be brought in and you 

have to try to figure out a way to spend the money better than 

what we are doing. 

Before I wrap this up, I just want to ask all of you. I did not hear 

in your testimony, in reviewing your testimony or in your answers 

to the questions or your oral statement, any of you say that you 

felt like you didn't care about the Endangered Species Act, you 

didn't care about wildlife, that you would just as soon do away with 

the Endangered Species Act. I did not hear any of you mention that 

you felt like we ought to gut the Endangered Species Act or repeal 

it. 

Is that correct? Do any of you want to--

Mr. SHARP. Mr. Chairman, I come from one of the most conservative areas in the United States. And, those little farmers out 

there, they could care-almost care less what's happening anywhere else if it isn't agriculture. 

But, they realize that Endangered Species is an Act that has 

merit. But, they also realize that they-that some of their farming 

practices are going to be in jeopardy because of the fact that endangered species, if they move into an area where they have not 

plowed under, they could lose the use of the land. The farmer up 

at Temecula is an outstanding example of that. 

And, no, they are-they want the Endangered Species Act, but 

they want the information in properly. If I may give an example, 

we are desert, extremely dry, less than three inches of rain a year. 

And, in the late 70's when the agencies were there doing the preliminary studies on flora and fauna, there was never any study 

done on rainfall. And, in those years, it was right after a 100 year 

rain and a 50 year rain and everything was blooming and everything was doing very well. 
67 

Seven years later, in the fifth year of a drought, they came back 

and did the second evaluation. And, of course, everything was in 

horrible shape. 

And, we have gone to the agencies. And, supposedly it was 

passed on to the peers. And, there has never been any consideration. 

If you turn the water faucet off in your own yard for a year, you 

are going to see a drastic reduction of plants, especially in your 

yard. And, here we have an area that it's nothing for some of those 

areas to go three years without rain. 

So, we are just saying get your information correct and then 

make your decision. And, we don't think that they have done that 

up to this point. 

Mr. POMBO. So, the message that you are bringing to Washington 

is that we need to make changes. You realize how important it is 

to protect species, how important it is to protect our fish and wildlife, but there are changes that need to be made in the current Act. 

Mr. SHARP. Absolutely, Mr. Chair. 

Mr. STOVALL. Yes, I concur in that, Mr. Chairman. I think many 

of our agencies are engaged in projects where they could actually 

be very beneficial to the environment, but they seem to get all 

balled up in this red tape and cost. It's really unnecessary. 

One of the things that impacts us is the fear actually of increased mandates after we've done one of these projects. Folks I 

know down in the metropolitan water district and in our area 

would like to engage in projects that can have some significant environmental benefits and enter into an agreement with the enforcement agencies. Yet, they can never, under the current Act, guarantee us or assure us that if we lay all this land fallow and allow species to invade it, that if some species is listed in the future that 

they won't be coming back and knocking at our door and asking for 

more. 

I think the project that Mr. Dooley referenced earlier on is an example of that. Where some of our agencies have done things to help 

the environment and they have wound up being penalized for it. 

That's not good for the environment either. . If we can avoid that kind of thing, I think that actually stands 

a chance of really providing some voluntary efforts to create environmental benefits. 

Mr. POMBO. Thank you. I would like to thank all of you for coming and testifying before the Committee. 

There may be further questions that members of the Committee 

may like to submit to you. Everybody on the Committee has received copies of your testimony. 

And, if there are further questions, they will be forwarded to you· 

in writing. And, if you could respond in a timely fashion to those 

questions, I would greatly appreciate it. 

And, again, I appreciate you sticking around all day for us. So, 

thank you very much. 

The hearing is adjourned. 

[Whereupon, the hearing was adjourned at 2:37p.m.; and the following was submitted for the record:] 
68 

STATEMENT OF ~LLIE BEATTIE, DIRECTOR, U.S. FISH AND WILDLIFE 

SERVICE, DEPARTMENT OF THE INTERIOR, BEFORE Tat ROUSE COMMITTEE 

ON RESOURCES, REGARDING THE IMPLEMENTATION AND ADMINISTRATION OF 

THE ENDANGERED SPECIES ACT. 

APRIL 17, 1996 

Mr. Chairman and members of the Resources Committee, I am very 

pleased to be here today to represent the Department of the 

Interior concerning the administration and implementation of the 

Endangered Species Act .(ESA). 

The last year has been a challenging one for me. I have had an 

opportunity to contemplate my life and the wonderful and 

intricate con9ections between all living things that share the 

Earth. And I am deeply convinced that our future is inextricably 

linked to the future of wildlife. If we are creating a world 

which is so inhospitable that hundreds and even thousands of 

species cannot survive, ultimately we will find our own survival 

threatened as well. 

;t 

In the heat of a public controversy, when people are knocking on 

-both your door and. on my door,. it is tempting to take the easy 

way out and avoid the hard decisions required to conserve wild 

species that often appear to have no known value to human 

society. Yet science tells us that hundreds of wild species may 

hold as yet undiscovered cures fcir cancer and other diseases. 

The deeisions we make about the Endangered Species Act this year 

will influence the medical treatments available to our children 
69 

and grandchildren in the 21st century. 

We must do our best to conserve all species, because there is no 

way for us to know what is still out there. Just two weeks ago, 

the Washington Post reported on the discovery of a new fossil 

primate, a tiny animal that lived millions of years ago and 

weighed no more than a few o~nces. Scientists now believe this 

very animal was an essential link in the evolution of higher 

primates, including human beings. When I read that article, I 

had to ask myself what future wonders we might be losing every 

time some small and seemingly insignificant creature becomes 

extinct. 

The Endangered Species Act is, in the scheme of things, a step in 

the right direction. Of all the species protected by the Act 

since 1973, 99.9% have averted extinction. The Act is fulfilling 

its charter to protect species and their habitats. However, no 

law is perfect and this Administration has stepP,ed forward and is 

nat only proposing, but implementing steps to improve the Act. 

Mr . Chairman, this Department has worked tirelessly over the last 

three years to change how the Act is administered and to make it 

work better for the American people. We have taken steps to 

implement and administer the ESA in a manner that conserves 

species, recognizes the rights of private property owners and 

achieves the most benefits in the most cost effective manner. 

2 
70 

Previously unexplored opportunities already contained in the ESA 

are being pursued. In doing so, we have discovered that the ESA 

has a wide array of tools to resolve or avoid conflicts between 

species conservation and the needs of our society. 

Last March, the Department of the Interior, in conjunction with 

the Department of Commerce, put forth a document · known as the 

"10-point plan" detailing the steps we be.lieve we can implement 

administratively to improve the· Act and highlighting those issues 

we believe must be dealt with legislatively. The objectives of 

the plan are based on a common-sense approach to the ESA and a 

concerted effort to address legitimate problems while preserving 

the core goal of protecting our nation's priceless biological 

heritage. The Department believes that the steps we have taken 

are indeed improving the way the Act works for both species and 

humans. 

Unfortunately, over the last two years, our efforts have been 

greatly. hindered by Congressional actions including reduct-ions in 

funding and the imposition of a listing moratorium. In addition, 

the legislation approved by this Committee to 'reauthorize the 

Act, H.R. 2275, would undermine the sciertific foundation of the 

ESA and impose a costly and bureaucratic process that would 

provide virtually no protection for species. 

A striking example of where the Department's efforts are being 

3 
71 

hirlclered by Congre·ssional actions would be in the area of 

candidate conservation. All of us would agree that the most 

opportune time to conserve species and their habitat is before 

the protections of the Act are necessary. In fact, one of the 

shortfalls of how natural resources were previously managed was 

that not enough ·emphasis was placed on candidate conservation. 

Over the last several years, ·the Department has placed increased 

priority on tl:)e early conservation of species. Between July 

1994 and July 1995, at least 15 candidate conservation agreements 

have been entered into and at least 20 or more such agreements 

are currently being developed. In addition, the FWS is in the 

process of finalizing guidance that will stress working with our 

partners to identify candidate species and to plan candidate 

conservation actions. By being proactive, we hope to preclude 

the listing of many species i'n the future. 

We have reached out to other agencies and private groups such as 

universities, State wildlife management agencies, resort 

developers and private landowners to undertake candidate 

conservation activities. As an example, a Memorandum of 

Agreement was completed to promote restoration and conservation . . . actions .that may make it unnecessary to list the r.obust redhorse 

(a candidate .fish species). Cooperators on this proj.ect include 

·the Fish and Wiidlife Service (FWS), National Biological Service 

(NBS), state agencies (GA,SC,NC), power companies, and 

4 
72 

conservation groups. 

Unfortunately, this Congress has chosen to severely curtail the 

funds available to participate and encourage these proactive 

measures. In fact, in the 1996 Interior Appropriations bill 

originally passed by the House, no money was provided for 

candidate conservation. In other words, Members of the House 

agreed to zero out funding for efforts that would greatly benefit 

both the public and species. 

The issue of providing landowners affected either directly or 

indirectly by the ESA with certainty is another area that I 

believe all parties would agree needs additional attention. Yet 

once again, Congress has stepped in and severely curtailed our 

efforts to improve both the listing process and the flexibility 

that can be provided to landowners. 

Over the last several years, numerous steps have been taken to 

improve the process by which a species is listed, as well as the 

administration of the ESA for those species already listed. 

Petition management guidance, to be released soon, will identify 

the data standards for accepting petitions to list a species. 

On July 1, 1994, the FWS and National Marine Fisheries Service 

(NMFS) jointly issued several policies to, among other things, 

ensure that the highest quality scientific information is used to 

5 
73 

develop and implement all ESA .related activities. Since that 

time, listing proposals and draft recovery ·plans have been made: 

subject to independent scientific peer review. The policies 

issued in July 1994 also increase greatly private sector 

involvement in activities dealing with the implementation of the 

ESA, thereby providing more certainty by involving the 

stakeholders in the process. 

Also, since July 1994, all final listing rules now state clearly 

which actions within the range of the listed species are or are 

not, likely to result in a "take" 0f listed wildlife in 

violation of the. ESA, to the extent that such actions are known. 

For ·example, when the Appalachian elk toe (a freshwater mussel) 

was listed, the FWS announced up ~ront that farming and legal 

mining activities in North Carolina and Tennessee would not 

likely result in a violation of the ESA. 

Additional steps are also being ta.ken to provide landowrier·s ,with 

certainty regarding potential future impacts · of ESA actions.. The 

"no surprises" policy announced by. Secreta.ry Babbitt in August 

1994, assures private landowners participating .in Habitat 

Conservation Plans · ·(HCPs) that·. no additional requirements wi~l be 

imposed on plan participants for species .covered by that HCP. 

The" Department is also proud of another common sense policy, the 

"safe harbor" program and its potential for encouraging p·rivate 

6 
74 

landowners to be involved in the recovery ,of listed species. The 

"safe harbor" program's goal is to encourage landowners to 

provide habitat for listed species. Under this program, private 

landowners with assistance from the FWS or with other qualified 

Federal or state agencies develop a management program to be 

carried out on their lands for the benefit of listed species. 

Based on such a program, a Safe Harbor Agreement is entered into 

at least by the Service and the lanQ.owner. The Service, in turn, 

will issue the private landowner a permit for any future take of 

listed species above the existing conditions at the time of the 

agreement. Over 23 "safe harbor" agreements, mostly in the 

Southeast and the West, have been or are being developed. In the 

past year, for the Sandhill area of North Carolina alone, 6 nonfederal landowners have been given safe harbor agreements and it 

is anticipated that an additional 15 will be developed this year. 

In addition, twQ HCPs incorporating safe harbor agreements have 

been approved by the FWS. 

More is also being done to use Habitat Conservation Plans to ease 

the regulatory burdens of the ESA on private landowners. In 

1992, 14 HCPs had been approved. As of the first March 1996, 141 

permits had been issued, and 300 more are in the works, 

demonstrating the flexibility of the ESA as it relates to the 

needs of private landowners. A new section 10 (HCP) handbook to 

be released soon provides clear guidance for all aspects of the 

HCP program; establishes a "low-effect" HCP category with 

7 
75 

expedited permit approval procedures; increases coordination 

requirements between the Field and Regional offices; establishes 

specific time periods for processing incidental take permit 

applications; and allows unlist·ed species to be named in the HCP, 

expediting future pe.rmit amendments if a species i s subsequently 

listed. 

Unfortunately, these proactive efforts by the Department are 

being hindered by this Congress. Last March Congress imposed a 

moratorium on all final listings and designatiqns of critical 

habitat. In imposing the moratorium, the Conference report makes 

it very clear that th·e moratorium was to be a "time out", not a 

long-term interruption of the listing process which is vital to 

species protection. Mr. Chairman, it has been over a year since 

this moratorium was enacted and funding for the ESA has been 

severely reduced. In addition, the Department is without an 

appropriations bill for Fiscal Year 1996, which ends in only 5 

months. 

The combination of these events is for all practical purpos~s 

devastating the Department's approach to species conservatien. 

Congressional listing prohibitions and funding cuts are eroding 

the Department's ability to implement the ESA in a manner that 

provides maximum flexibility in species conservation to avoid 

potential conflicts. Although imposing a moratorium and cutting 

funds may temporarily avoid a few of the ·immediate problems faced 

8 
76 

by the 104th Congress, in the long-term these actions will harm 

rather than benefit both species and landowners ' who must find a 

way to comply with the ESA. 

238 U.S. species already proposed for listing are caught in limbo 

under the moratorium and an addi·tional 182 listing candidates are 

also vulnerable. Under the current scenario, the status of these 

spPcies may continue to decline and the public's petitions will 

go unanswered, If we continue to ignore these species, it will 

take more time, money and effort to recover them when we finally 

do receive the money and authority to protect them. The longer 

we delay action on these species, the less flexibility we are 

able to provide to those who are affected by the Act. This 

outcome is bad for the economy, bad for private landowners and 

especially bad for the species involved. Congress must lift the 

morator~um and restore full funding to the endangered species 

program immediately. 

For many other activities required under the Endangered Species 

Act such as consultation, recovery and cooperation with states, 

Congress has again proposed budget cuts that will significantly 

impede the Department's ability to be responsive to landowners 

while protecting species. 

Federal agencies and the lands under their jurisdiction are key 

to· species conservation. Sig~ificant progress is being made in 

9 
77 

improving and increasing the involvement of other federal 

agencies in endangered species issues. The section 7 interagency 

Consultation process is one of the most important parts of the 

ESA. Consultation occurs with other agencies to ensure that 

federal projects are not likely to jeopardize the continued 

existence of listed species. It is an integral component of 

listed species recovery. 

Several Memoranda of Understanding (MOU) and Memoranda of 

Agreements have been developed to facilitate increased 

cooperation among federal agencies. For example, in May 1994, 

FWS signed a multi-agency MOU to establish a Federal Native Plant 

Conservati~n Committee to identify priority conservation needs 

for native plants and their habitats. To date this agreement has 

been signed by 9 Federal agencies and 50 other cooperators. 

Obviously, the Federal government is not the only player in the 

implementation of the ESA. In addition to the cooperation of 

private citizens, building new partnerships and strengthening 

existing ones with state, tribal and local governments is 

essential to achieving the goals of the Act. Policy directives 

to enhance the participation of state fish and wildlife agencies 

in implementation of the ESA, include state expertise and 

information in the listing, consultation and recovery processes. 

have been issued. One of the most important components of the 

ESA is the Cooperative Grants provided to state programs, and we 

10 
78 

wi ll continue to pursue increased funding for these grants. 

Programs such as th~ reintroducti6n of bl ac k-footed fe r rets would 

not have been possible wi thout t he ac tive participation of the 

sta:tes. 

Finally, the goal of any endangered species program is the 

recovery of species. Compare the small amount .of time the 

recovery program has been in place, only 20 years, to the long 

period that many species hav.e been in declin~ -- for some , about 

300 years -- and one has to conclude that the program is a 

resounding success. For species protected in 1973 by the 

original Act,. 58.% are stable or improving; .for speci~s listed 

between 1974-78 , 42% are stable or improving; for species ·listed 

between 1979-88! 44% are stable or improving ; and for those 

listed after 1989, about 22% are stable or improving. The fact 

that al~ost all listed species still exist speaks to the 

trem~ndous success of the program. 

Recovery plans are being developed in a timely manner that 

includes the input of a diversified group of stakeholders; 

promotes the conservation of multiple species and their· habitats; 

and minimizes the social and economic impacts of recovering the 

species. For example, over 7 multi-species recovery plans have 

been or are being developed at this time, ·including the 

Everglades Recovery plan, the Southwestern Riparian Recovery Team 

and the Mobile River Recovery Plan. 

11 
79 

I ·am well aware that some will object to r estor i ng the endangered 

species program on the grounds that the country can~ot afford to 

protect endangered species. Mr . Chairman, it is my firmly held 

belief that the country cannot afford NOT t o protect endangered 

species. Three recent reports by independent economists examined 

t!'le assumption that environmental regulations, and endangered 

species protections in particular, are damaging to the economy. 

All three concluded that the data do not support this belief, and 

that indeed a . heal thy. environment is essential to a heal thy 

economy. 

A repor~, endorsed by 60 Pacific Northwest economists, found 

that between 1988 and 1994, the number of jobs in Idaho, Montana, 

Oregon, and Washington increased by 940,000, or 18 percent ·-- two 

to. three times the national rate . These economists note that the 

Pacific Northwest is making a successful transition from J 

' dependence on a few extractive industries to a modern, widely 

diversified economy. These economists found that natural 

la.ndscapes today may often generate .more new jobs and income by 

providing a beautiful and healthy environment, making the Pacific 

Northwest an attractive place to live and work. "A healthy 

environment," they report, "is q. major stimulus for a healthy 

economy." 

Another report is a preliminary work by M.IT economist Dr. Stephen 

Meyer on the impact of endangered species listings on home 

12 
80 

bui lding and the real esta t e industry . Dr. Meyer examined the 

assertion that the listing of the northern spott'ed owl drove up 

timber prices and increased the cost of new single-family homes 

across the nation. He found that housing construction rates drive 

long-standing cycles of production and prices in Pacifi c 

Northwest timber, and the.re is no evidence -that the listing of 

the spotted owl had a demonstrabl e impact on timber prices, or 

that the price of Pacific Northwe st timber had any measurable 

effec t on home prices. 

The California Senate Office of Research built on the MIT study 

and found that in California environmental regulations have had 

minimal impact on plant closings and job losses. This report 

also says market forces played a greater role in paring back jobs 

in the timber industry than did the limits on harvest of oldgrowth timber required to protect the owl. I am providing all 

three reports for the Committee. 

I am well aware t·hat conservation values cannot be reduced to 

mere dollars and cents. But as government officials, we are 

properly required to calculate the expenditures for our programs. 

The Interior Department has submitted detailed information 

related to the expenditures for the endangered species program 

requested by the Chairman . I would like t o request that the 

Department's response be included ~s part of the hearing record. 

Included in this response were the Expenditure Reports for 1992 

13 
81 

and 1993. The Expenditure Reports detail the amount of money 

reported spent by all Federal and State agencies on endangered 

species 1ssues including all of the Department's agencies. Also 

attached to my testimony is a summary of each of the Department 

of Interior's agencies/bureaus expenditures on endangered species 

programs. 

I would like to thank the Members for the opportunity to appear 

before the Committee on behalf of the Department of the Interior 

and I will be happy to answer any questions Members might have 

related to this information. Also, accompa·nying me today are 

officials from the agencies at the Department of the Interior 

including BLM, NBS, NPS, BOR, and FWS to provide technical 

assistance on questions relating to their ESA expenditures. 

In closing, the ESA is a necessary and important component of our 

efforts to protect this nation's biodiversity. I believe that as 

a nation we can afford to protect endangered species, and there 

are powerfully compelling reasons for doing so. This D~partment 

is continuing to make the Act work better for species and the 

public. However, if we are to be successful in our efforts, 

Congress must adequately fund the program and remove the shackles 

of the listing moratorium. Don't let the legacy of the 104th 

Congress be the destruction of one of our nation's most important 

environmental laws, and the impoverishment of our natural 

her i ta.•Je. 

14 
1 ~.DEPARTMENT OF THE INT

ENDANGERED SPECIES EXPENDITURES <x $1 0

YEARS I 989- I 993 
83 

NOT FOR PUBLICATION UNTIL RELEASED BY THE 

HOUSE RESOURCES COMMITTEE 

---~)-::'0-> ~~ ;·_ y~;~~~i)A:·:·:f~:i&/ " .. ,DEPARTMENT·OF DEFENSE·.·· Lt\ "/:~,'·f·/?7 .. 

... •i"£~~~£2:'·•'?&~:0t~: 

STATEMENT OF 

SHERRI W. GOODMAN 

DEPUTY UNDER SECRETARY OF DEFENSE 

(ENVIRONMENTAL SECURITY) 

BEFORE THE 

HOUSE RESOURCES COMMITTEE 

APRIL 17, 1995 

NOT FOR PUBLICATION UNTIL RELEASED BY THE 

HOUSE RESOURCES COMMITTEE 
84 

I would like to thank Chairman Young and the members of the House Resources 

Committee for inviting me to testify today on behalf of the Department of Defense. 

DoD is a large user of land, sea, and !l.irspace. We manage 25 million acres of 

land across the United States, a land measurably the size of the state of Virginia. DcD 

has 400 major military installations and is the third largest land management department 

in the United States. DoD lands are managed first and foremost to provide for the 

military training and testing necessary to enhance readiness. 

DoD land is needed to support readiness, testing of new weapon systems, testing 

of munitions, deployment of weapon systems, and combat training exercises. Specific 

and unique natural features of the land are crucial to military readiness. To have the 

ability to deploy and fight successfully anywhere in the world, the armed forces must 

train in a wide variety of climatic and terrain conditions. Accordingly, training areas are 

located throughout the United States on grasslands, desens, coastal areas, forests and 

tundra. For example, desert environments are used for maneuvers that involve large, 

mechanized battalions; coastal zones z.nd beaches provide the setting for missile launches 

and amphibious landings; forested areas are essential for small arms combat training; a11d, 

large open areas are needed to accommodate air-to-ground bombing ranges. 

DoD lands are rich in various natural resources and we have an obligation to 

protect those resources for future generations. Our lands are hl)me to many important 

species and habitats. At least400 candidate and listed threatened and endangered species 

are found on our installations. Our im;tallations also contain some of the finest remaining 

examples of such rare native vegetative communities as old-growth forests, tall-grass 

prairies, and vernal pool wetlands. DoD takes pride in its stewardship program and has 

had policies in place to protect natural and cultural resources for many years. This early 

commitment has evolved into well-defined, formalized, and integrated conse-rvation 

policies. 

Our military lands and waters hold a storehouse of rare biological resources --

desert tortoise, bald eagle, manatee, least tern, greenback cutthroat trout, desert bighorn 

sheep, western snowy plover, smooth coneflower, red-cockaded woodpecker, Florida 

scrub jay, loggerhead sea turtle-- just to name a few. Consultations under the National 

Environmental Policy Act and section 7 of the Endangered Species Act have been carried 

out for over 20 years. DoD has been extremely successful in balancing compliance with 

the Endangered Species Act with conducting military training activities to ensure military 

readiness and provide for national security. No DoD lands however, are managed solely 

for the protection of endangered or threatened species. 

DoD's conservation program is closely tied to support the military mission. 

Sound conservation management practices enhance mission safety; promote sustainability 

of training areas; provide increased flexibility for military trainers; and enhance the 

quality of life for our installation residents and those that reside in the vicinity of an 
85 

installation. And, sound conservation management helps sustain our natural resources, 

including our threatened and endangered species. 

Our military activities are performed to ensure the highest possible safety of 

operations. For example, buffer or safety zones are established around artillery or aerial 

bombing impact areas. These buffer zones, in which no activities are usually permitted, 

also benefit wildlife, particularly endangered species. For example, the red-cockaded 

woodpecker thrives in the buffer zones at Eglin Air Force Base (AFB), Florida-- a 

perfect example of how performing the military mission and protecting natural resources 

often are mutually beneficial endeavors. 

Another important mission-oriented safety program is the Bird Air Strike Hazard 

(BASH) program, aimed at minimizing collisions between military aircraft and birds. 

Knowledge of where birds travel, nest, and feed helps DoD avoid problem areas and 

therefore avoid loss of life or the destruction of valuable airplanes. In September 1995, 

an E-3B A WACs aircraft departing Elmendorf AFB in Alaska, struck a flock of Canada 

geese. The aircraft crashed and all 24 crew members were killed. As a result of this 

accident, the Air Force has improved its preparation for the bird migration season and 

developed a more aggressive program to detect and deter geese. This program has also 

reduced adverse effects on bird populations. 

Controlled burns enhance public safety, protect DoD assets that are essential to 

conducting training, and can open inaccessible areas to ground training. These measures 

destroy unwanted undergrowth, recycle nutrients, and promote healthy, natural habitat. 

They can also be vital to the survival of some threatened and endangered species. 

DoD must manage land in such a manner that it can support sustained training 

activity. This is an important consideration for the Army whose training needs, especially 

for heavy armor, are particularly hard on the natural terrain. However, if training and 

associated land maintenance is not carefully planned and managed, the land will 

deteriorate, and eventually become incapable of providing realistic training. The 

Integrated Training Area Management (IT AM) program was developed to ensure 

sustained use of military lands to support readiness training. The program balances the 

demands of training activities with the ability of the land to recover from the affects of 

training. ITAM employs technologies such as Land Condition-Trend Analysis Computer 

programs, global positioning systems (GPS), and geographic information systems (GIS) 

to monitor trends in the condition of soils, vegetation, and sensitive resources over time, 

and to determine appropriate management actions, such as rotation of training areas. 

Enhanced awareness is another important component of IT AM. Military personnel are 

briefed on environmental issues and are more aware of sensitive ecological areas or 

endangered species located in their training area. Installations using IT AM's approaches 

to natural resource management will ultimately increase the level of realism in their 

training exercises. 

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In addition to IT AM, DoD installations use other management tools to conserve 

and enhance fish and wildlife populations. Under authority of the Sikes Act, we work in 

cooperation with the Department of the Interior and State fish and wildlife agencies. Our 

current efforts focus on completing biologic inventories on all our lands, and preparing 

and implementing management plans to sustain these resources. These plans are 

comprehensive blueprints for managing species and their habitats on a base so lands will 

be preserved for generations to come. 

DoD integrates all facets of natural resources management, including hunting and 

fishing, commercial forestry and agriculture programs, outdoor recreation, and threatened 

and endangered species management with the military mission. Activities primarily 

focused to benefit one program component are planned to benefit other elements as well. 

For example, erosion control programs intended to protect threatened and endangered 

species habitat, or to prevent soil runoff into streams, also sustain management of 

critically important military training lands. These programs provide resource managers a 

better understanding of plant and animal life, ground disturbances, soil characteristics, 

and the land's ability to withstand training uses. By using comprehensive, integrated 

resource planning, DoD natural resource managers ensure that military mission 

requirements are met and threatened and endangered species are preserved. 

In recent years, DoD has developed new management approaches to increase 

military training flexibility on the use of land inhabited by a threatened or endangered 

species. One approach is to manage natural resources as part of an entire ecosystem. 

Land management plans and species recovery plans are developed based upon a more 

complete understanding of resources and habitat throughout the region. The plans 

balance the responsibility for supporting endangered species among all major federal 

landowners. In addition, the plans ensure future development does not interfere with 

mission capabilities and is compatible with measures to protect endangered or threatened 

species. That's why we're moving to an ecosystem approach to managing our lands. At 

Camp Pendleton, this new approach is exemplified by the recent signing of the first 

multi-species programmatic agreement with the U.S. Fish and Wildlife Service. This 

agreement, which protects 14 riparian species, also allows the Marine Corps increased 

access to riparian and beach areas at Pendleton for training. 

Detailed inventories have resulted in a lessening of restrictions on military 

operations. For example, at Nellis Air Force Range in Nevada, a focused plant inventory 

Jed to the discovery of a large population of a poppy that had been proposed for addition 

to the Federal endangered species Jist. The size of the population and the protection 

provided by the Air Force's management of the range resulted in a determination that the 

species need not' be listed. 

DoD's ecosystem approach to managing its natural resources considers groups of 

plant and animal species instead of relying on traditional management of single species. 

It promotes adaptive management sustainable for both human and ecological purposes. 

The Camp Pendleton example demonstrates how a heavily-used military base can 

3 
87 

coordinate plans for military activities and management of ecological zones for numerous 

threatened and endangered species. 

A similar effort to enhance mission capabilities and protect threatened resources is 

being undertaken in California's Mojave Desert. Most of DoD's large-scale unit training 

exercises and major weapons testing is conducted in the Mojave Desert. In the Mojave, 

our troops trained for Desert Storm. Located in the area are such major installations as 

the Anny's National Training Center (NTC) at Fort Irwin, Marine Corps Ground Combat 

Center Twepty-Nine Palms, Edwards AFB, and Naval Air Weapons Center China Lake. 

DoD protects many natural resources on these lands that are significant to its long-term 

sustainability. All the Mojave installations are working to protect the current and future 

missions at the military installations located in the Mojave Desert by developing land 

management plans. As part of this effort, all major land owners in the region would 

contribute to the development of a scientific data base that will be used in preparing 

species protection and land management plans. This data base will provide land 

managers and military personnel a better understanding of the total desert ecosystem and 

provide greater flexibility in the use of the Mojave for military activities. 

DoD funds used to manage and protect threatened and endangered species come 

from each Military Service's overall conservation budget or from special sources such as 

the Legacy Resources Management Program. DoD will invest approximately $150 

million in FY96 for conservation programs to manage and maintain its training and 

testing areas. ~only a small portion of this amount-- less than 15 percent -- is devoted to 

activities that affect endangered or threatened species or are required by the Endangered 

Species Act. Last year, DoD invested approximately $19.5 million in actions specifically 

designed to benefit these protected species. DoD's investment in conservation activities 

is primarily to support readiness training. Consequently, many activities attributed to the 

Endangered Species Act would be accomplished in any event in order to ensure effective 

training or testing. 

In these times of shrinking budgets, federal agencies -- no matter what their 

mission -- must work together to share resources and information and implement 

management plans. No one agency can unilaterally solve today's environmental 

problems nor adequately protect species -- it requires a cooperative effort. I am extremely 

pleased to be here today with the directors and assistant administrators from the various 

federal agencies that share the Department of Defense's interest in protecting endangered 

and threatened species. 

The military testing and training mission is compatible with the goals of 

environmental agencies. But it takes careful planning. The fact that threatened and 

endangered species have continued to thrive on our military installations is proof of this. 

Protection of threatened and endangered species has not hurt our military readiness and, 

in some cases, has even enhanced it. DoD's challenge is to continue to protect threatened 

and endangered species on military installations while we conduct increasingly realistic 

military training and maintain military readiness. DoD has risen to this challenge by 

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managing its 25 million acres through a comprehensive integrated stewardship program 

that ensures our activities do not harm threatened or endangered species. The proof of 

our success, therefore, cannot only be seen by thriving threatened and endangered species 

populations on military installations, but also by our high state of military readiness. 

I would like to share with the Committee today a few of our many success stories 

in endangered species management. Eglin Air Force Base in northern Florida is home to 

the fourth largest population of endangered red-cockaded woodpeckers in the country. 

The Air Force has carried out both short-term, species-specific projects, and long-term, 

ecosystem-based actions that enhance the woodpecker's habitat. These actions include 

prescribed fires to control invading hardwood trees and promoting the regeneration of the 

longleaf pine forest upon which the woodpecker depends. Air Force units that train in the 

forests treat nesting trees as biologically contaminated sites or mines to avoid disturbance 

of the woodpecker. These techniques demonstrate how DoD is integrating the needs of 

an endangered species with those of the military mission. 

The Army conducted a detailed review of natural resource plans for installations 

in the southeastern United States, focusing on the endangered red-cockaded woodpecker. 

In coordination with the U.S. Fish and Wildlife Service, the Army reviewed the plan, 

evaluated the viability of existing populations, and developed standard management 

guidelines for use of such tools as prescribed burns, protection of nesting trees, and 

control of hardwood understory growth. The habitat maintenance aspects of these 

guidelines are assisting installation resource managers to satisfy requirements of the 

Endangered Species Act. 

In addition, we are currently consulting with the U.S. Fish and Wildlife Service to 

revise the training restrictions aspects within the management guidelines and the manner 

in which we determine red-cockaded woodpecker (RCW) population goals at Army 

installations. This initiative was undertaken in order to address concerns that the training 

restrictions outlined within the Army's guidelines were unnecessarily hampering training 

realism, particularly at Fort Bragg, North Carolina. On December 7, 1995, the Army and 

the U.S. Fish and Wildlife Service tentatively agreed to revised management principles 

that would enhance training realism on Army installations while conserving and even 

enlarging RCW populations on Army installations. The primary benefits of the 

agreement will be two-fold. First, the revised guidelines will reduce the total acreage of 

land subject to training restrictions at Fort Bragg and other southeastern Army 

installations. Second, endangered species management plans approved under the revised 

guidelines, with the U.S. Fish and Wildlife Service's concurrence, will provide freedom 

from training restrictions at some of the areas where the Army actively recruits and 

manages the growth of RCW populations in mission essential areas of an installation. 

We believe this agreement with the U. S. Fish and Wildlife Service strikes a reasonable 

balance between the training mission and conservation of the woodpecker. The Army 

and the U. S. Fish and Wildlife Service are continuing work on this initiative and hope to 

implement the new guidelines this summer at Fort Bragg and other Army installations. 

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This approach may have applications with other endangered species at military 

installations conducting intensive military training or testing activities. 

The Navy is implementing management plans designed to protect endangered 

marine species. To protect the endangered West Indian manatee, managers at Naval 

Submarine Base Kings Bay, Georgia, worked to design a protective device that would 

prevent manatees from being injured or killed by ship propellers. After a prototype 

design was tested, the guard was found to be successful not only in protecting the 

manatee, but also in improving the efficiency of the tugboat on which it was installed. 

Because of the mutual benefit to manatees and naval operations, guards have been 

installed on all Navy craft (does not include ships) operating in the bay. This example 

highlights how the protection of a species can lead to other, unexpected benefits. 

In some instances, DoD, in order to increase operational flexibility, has taken 

action to help a species thrive. These actions, while modest in cost, have been extremely 

effective. For example, efforts by the Marines to increase the number of mating pairs of 

the least Bell's vireo, an endangered songbird, have been so successful that the U.S. Fish 

and Wildlife Service has determined that the establishment of a critical habitat area is no 

longer warranted. In addition, the Marines have greater flexibility in their uses of 

sensitive lands, such as riverbeds, since the U.S. Fish and Wildlife Service has 

determined that, given the size of the vireo population, a few inadvertent takings would 

be acceptable. 

Fewer than 700 Greenback Cutthroat Trout, native to the Arkansas River, 

remained in existence in 1978. Since 1981, Fort Carson, Colorado, in coordination with 

the U.S. Fish and Wildlife Service and the Colorado Division of Wildlife, has been 

involved in a recovery effort for this species, which is officially listed as threatened. In 

I 98 I, Fort Carson filed a change of use for an existing water right and constructed a 

broodstock pond for rearing the Greenbacks. Initially, 40 Greenbacks were transported to 

Fort Carson's pond. Eggs and fish from this pond have been used to establish 

reproducing populations within national forests. Due to the overall success of this 

recovery program, Fort Carson now has a limited catch and release program for this 

species that is sanctioned by the U.S. Fish and Wildlife Service. 

DoD would not have the option of being a major player in these partnerships and 

interagency working groups had we not had years of responsible natural resource 

planning on our installations behind us. Knowing the challenges that exist when an 

agency must manage lands for several sometimes-conflicting purposes has enabled DoD 

to participate with land management agencies on an equal footing . The work of our 

natural resources managers at our installations forms the strong foundation for this 

increased conservation role. 

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DoD makes investments each year to ensure that missions can be performed with 

little or no impact on threatened or endangered species. DoD has been able to meet the 

provisions of the Endangered Species Act and at the same time conduct the necessary 

training and testing to be ready to meet any military challenge. 

I would be happy to answer any questions from the Committee. 

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DEPARTMENT OF lllE ARMY 

OFFICE OF lllE ASSISTANT SECRETARY OF lllE ARMY 

(CIVIL WORKS) 

COMPLETE STATEMENT 

OF 

MAJOR GENERAL STANLEY G. GENEGA 

DIRECI'OR OF CIVIL WORKS 

U.S. ARMY CORPS OF ENGINEERS 

BEFORE lllE 

HOUSE OF REPRESENTATIVES 

COMMITTEE ON RESOURCES 

ON 

IMPLEMENTATION AND ADMINISTRATION 

OF lllE 

ENDANGERED SPECIES ACT 

WASHINGTON, D. C. 

APRIL 17, 1996 

MR. CHAIRMAN AND MEMBERS OF lllE COMMITTEE: 

INTRODUCTION 

I am Major Generu Scanley G. Geoep, Director of Civil Works for lbe U.S. Army Corps of 

Engineers. 1baok you for lbe opponuoity to describe lbe expendirures and associated activities of lbe Corps to 

conserve endangered and lbreatened species in coDDeCiion wilb our Civil Works Program. 

The Corps began to keep track of its national expeoditures for implementing lbe Endangered Species 

Act (Act) during Fiscal Year 1989. The Department of lbe Interior, in response to the 1988 Amendments to lbe 

Endangered Species Act, requested lbat lbe Corps provide a species-by-species accounting of our expenditures 

in implementing our duties and responsibilities pursuant to lbe Act. i will summarize our responsibilities, 

expenditures to date, and lben provide a perspective on four different regions of lbe country lbat bave 

particularly significant and on-going issues involving Federally listed endangered and threatened species. 

ARMY'S RESPONSmiLITIES 

Tbe Army, throutzh lbe Corps Civil Works Program, carries out project related activities of planning, 

construction, operations and maintenance to implement lbe Secretary of lbe Army's aulborities for navigation, 

flood damage reduction, environmental protection and restoration, and related purposes. The Corps also carries 

out the Wetlands Regulatory Program autborized under Section 404 of lbe Clean Water Act, the 1899 Rivers 

and Harbors Act, and lbe Marine Protection, Research, and Sanctuaries Act. The Corps bas planned, 

developed, and cumntly maintains 12,000 miles of waterways; bas constructed 8,500 miles of flood conrrol 

levees and 383 reservoirs; and bas constructed and operates 75 hydroelectric power facilities. The Corps bas 

stewardship responsibility for nearly 12 million acres of land and water at over 460 projects. 

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The Co1p5 Civil Works Program deals wilh lhe Endangered Species Act primarily in four functional 

areas: project planning; resource management at existing projects; dredging of Federally-maintained waterways; 

and, the operation of multipurpose flood damage reduction and hydropower projects. In these functional areas, 

determinations are made concerning whether consultation is required under lhe Endangered Species Act, and 

whether mitigation or conservation and other steps under lhe Act are appropriate. 

In addition to these functional areas, the Corps carries out a regulatory program that provides the 

authority to ~le Secretary of the Army to regulate: dredging, structures and other types of work in navigable 

waters of the United States; the discharge of dredged or fill material into waters of the United States, including 

wetlands, under Section 404 of the Clean Water Act; and the transport of dredged material for the purpose or 

ocean disposal WJder Section 103 of the Marine Protection, Research and Sanctuaries Act. Compliance with the 

Endangered Species Act is required before issuance or any permit under our regulatory program. 

FISCAL YEAR EXPENDITURES 

The a~mual Corps response to the Department or the Interior bas been standardized to include 

expenditures in the following categories: all costs related to consultation Wlder Section 7 or the Endangered 

Species Act: all costs for Corps involvement in recovery teams and recovery plans; all costs associated with 

'incidental take' provisions issued with lhe Act's biological opinions; all costs incurred for studies, research, 

observers and monitoring required by the Act; and, all costs for mitigation. There are no regulatory program 

funds spent directly to administer, implement, conserve or protect endangered or threatened species. The Corps 

does, however, spend regulatory funds in evaluating and conditioning permits that support the conservation and 

protection or endangered and threatened species. These petmit processing costs are included in lhe expenditure 

figures provided below. 

ln Fiscal Year 1989, the Corps expended $4,081 ,000 for activities relating to endangered or threatened 

species. Over 30 percent of that amount was for three species in the Corps South Pacific Division, primarily in 

Califorrtia and Arizona. Those species '''ere lhe Bell's least vireo, lhe California least tem, and lhe desert 

tonoise. 

In Fiscal Year 1990, the Corps expended $8,081,000. Almost SO percent of this was for three species 

in California. 

In Fiscal Year 1991, lhe Corps expended $7,675,000. Of this, a total of $2,500,000 was spent for sea 

turtles and the n:d<oclcaded woodpecker wilhio the jurisdiction of lhe Corps South Atlantic Division and 

$1,400,000 was spent for the Bell's least vireo in Califorrtia. 

In Fiscal Year 1992, lhe Corps expende-d $30,168,000. The dramatic jump in costs reflects 

expenditures of approximately $13,000,000 by the ColpS North Pacific Division on all manen related to lhe 

salmon crisis in the Columbia and Snake Riven, Washington, Oregon, and Idaho; where several species of 

Pacific salmon bad been listed as either threatened or endangered pursuant to lhe Act. This figure includes 

costs for fish passage facilities on the Columbia River that benefit endangered species. We would note lhat the 

juvenile fish passage program was initiated prior to the listing of salmon species. It sbould also be ooted, lhat 

other species, DO( tlueateoed or endangered (sucb as steelbead), also benefit from these facilities. 

In Fiscal Year 1993, the Co1p5 expended $33,960,000, of which the single largest cost was for 

litigation, recovery and resource protection activities related to rnauen involving Pacific salmon in the northwest 

($21,600,000). 

In Fiscal Year 1994, the Corps expended $51 ,866,000. Again, the single largest portion of this figure 

was allocated 10 matters involving the Pacific salmon in Washington and Oregon, wben: the Co1p5 spent 

$40,800,000 on fish passage facilities and olher measures to protect tlueatened and endangered fish as required 

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93 

by 1be Act. 

In Fiscal Year 1995, 1be Corps estimates lbac itlpCIIC approximacely $95,000,000 lmplemeodaa cbe · · · EDdaJiaered Species Act. 1bis is an esrimace because Corps field oftlccs haw 1101 :yec 1q1011Cd delai1ed apec:ICsby-apec:ics expeodicures used 10 prepa.e die formal Corps .eponto lbc Depanmeot or lbc lncerior. Tbe Fiscal 

Year 1995 estimace of expeodi~~~~es for Pacific salmon aloDC is $83,000,000, due, primarily, to fish passaae 

facility coosuuction io Washioston on die Columbia and Soake Riwrs. II sbould be aoled lbat aboul 73 pezm~l 

of lhese appropriaced expeodi~~~~es a.e .epaid to die Treasury by power users lhrousb lbc BoDDeVille Power 

Adminisuation. 

We estimate expeodi~~~~es io Fiscal Years 1996 and 1997 to be $120,000,000 and $145,000,000, 

.espec:tively, due larscly to coscs for coosuuction and operation or lbc fish passase IIICISURS on tbc Columbia 

and Soake Rivers io Washington, Oregon, and Idaho. Tbe Corps estimates that Fiscal Year 1996 expeodiiiiJeS 

on salmon will be approximacely $ 7$,000,000. In Fiscal Year 1997, we project salmon expendicures will apio 

iocJease to approximacely $ 107,000,000. 

REGIONAL ACTIVITIES 

I would now like to bigblislll four Corps activities, io four .egioos of die country, lbat have siaoificaot 

eodaosered apec:ics issues warranting discussion. In each case, lbc activicy or project is complex and lbc 

eodanse.ed species of concem have bigh visibilicy on both a regional and national level. 

PACIFIC NORTHWEST HYDROPOWER- SALMON 

Tbe Corps operates twelve mainstem projecll io die Columbia-Snake River basio lbat provide 

hydropower, flood cootrol, irrigation, fish and wildlife, wacer supply and navigation usc. Tbe dams also chansc 

river conditions, flows, and temperatures. Tbese changes can adversely affect aquatic U~. and creace obslacles 

for misratios salmon. Tbe Corps has mitisated for etreccs or lbc dams on fish and wildli~ sioce Booneville 

Dam was constructed io the lace 1930s. Mitisalion iocludes juvenile and adult bypass syscems lbr misratioa 

salmon 11 lbc eight Corps dams io the lower Columbia and Snake Rivers. Tbe Endaoaered Species Act llsdup 

or lbc Soake River ulmon in 1991 and 1992 have accelerated efforll to improve llsh JIISS&8C 1ya1e1111 atlbcle 

dams. A National MariDC Flsberies Service biolosical opinion oa lbc etrecll of hydropower syscea operation 

on listed Snake River salmon, issued io March 1995, iocludes recommendations lbr cbaaaes to project 

operations and the bypass systems 10 improw salmon misratioa conditions. A Corps R«ord or Decision 

cloc:umeots tbc aseacy's iDieDt to implemetlllbc biolosical apioioa's IIICISURS to lbc exceot possible. 

Although lbcre is muth lbciiS placed on improvements at lbc dams, o1ber factors in die Almon lifecycle, such u qualicy or ocean and 11rea111 habitat and lbc effects or hall:beries Uld hanesls, are also beW, 

addressed. Salmoa habitat is diverse Uld JCOBrlpbicall)' widespread, affeclins IDID)' diffcriaa iotcresllsucb U 

fishers. irripton, sbippers. m:.eatioaal uscn, and power pmclucen. Most ialeresu ia lbc .elfao apee that 

healthy ulmon runs are impoJWll to tbe reBiooaJ economy and culture and much or lbc wort &bead relateS 10 

the creatioll or a cODsellllll oa rebuildias Stocb. 

SOlTiliEAST COAST NAVIGATION- SEA TURTLES AND RIGHT WHALES 

Tbe second Corps activity thal1 wish 10 bisbliJbl is •be lllliateaance of die Federal coual aaviptioa 

s)'Siem alons lbc southeuc coast of lbc United States. A 1990 SIUdy by lbc Nallonal Acadelll)' or Scleaces, 

eolitled 'Decline of the Sea Tunies, Causes and PreYC'IItioD, • eSiimaled lbat hopper dredses ~ lr:illiaa u 

many u SOO loBBCllleld sea tunles Uld up to SO Kemp's ridley sea tun1es &JIIIU&Ily. Moaitoriaa of ehaaDcl 

maia~eaance activities at lbc Brunswick and Savannah, GeoraJa, ship ehanaels from March tJuuusb July 1991 

clocumealed lbc monalicy or 38 sea tunles. 

3 

24-936 96-4 
94 

FoUowins m:eipt of a resional biolosical opinion under lbe EndaJlsered Species Act, lbc Corps Soulh 

Atlantic Division issued policy suidance reslrictins hopper dredsins in Soulheasl navisalion clwmels to lbc 

perind of December lhroush March. An intensive research effon was also initialed to develop new ccchnolosies 

10 protect sea tunics and to detenoine lbe seasonal distribution of sea tunles. In cooperation wilh lhe National 

Marine Fisheries Service, restricted dredgins demonstrated Chat, in a 3 year period, a total of 20 million cubic 

yards of material were dredsed from nine harbor projects wilh lhe unintentional takins of only one Kemp's 

ridley and eisht losserhead sea tunics. While lbese losses are unfonunate, it is substanlially less Chan lhe 

number allowed by lhe incidental take provision in lhe biological opinion. Throush our reseuth elfon, we 

have developed a hopperdredse draghead designed 10 deflect sea tunics. While not affectins dredgins 

production rates, Ibis deflecting draghead was 9S percent effective in deflectins artificial sea runles during 

developmental testins. 

The Corps sea runle research effon is producing biological information in addition to lhe dredgina 

effects results. Each runic collected during lhe monitoring effon was measured, aged and tasscd. Furure 

recaprure of lhese tunics will yield new informacion on sea runic growth rates, behavior and distribution. 

Anolher endangered species, lhe right whale, was found to be at potential risk durina lhe December 

lhroush March dredging window established for sea tunic procccrion. The offshore areas of nonhero Florida 

and soulhem Georaia are lhe only known risht whale calving srounds in lhc nonb Atlantic Ocean. To protect 

lhe~lhe~~~~~~~~~~~-~·~are 

sisbtcd, dredse operators, enmute 10 an ocean disposal site, are insuucccd 10 reduce speed. Not a sinsle right 

whale ~ ~ imperiled in over a lhousand round trips 10 lhe disposal site. This interascncy cffon, dubbed 

lhe "Risht Whale Early Wamins System, • is pan of lhe recovery effon for the whale under lhe Endangered 

Species Act. 

MISSISSIPPI AND MISSOURI RIVERS AND TRIBUTARIES- SHORE BIRDS AND STURGEON 

Two shore birds given protection by lhe Endangered Species Act, lhe least rem and lhe pipina plover, 

nest on bare sandbars and islands below Corps consuucted and operated reservoirs in lhe Missouri River. In 

I986, lhe year after lhese species were added to lhe endangered species list, lhe Corps began operating lhe 

Missouri River Mainstcm Reservoir system 10 prevent flooding of lhese species' nests. 

Formal consultation under section 7 of lhe Act was iniriated wilh lhe Fish and Wildlife Service in 1987 

and concluded in 1990 wilh lhe issuance of a "jeopardy" biological opinion. The Fish and Wildlife Service 

determined Chat jeopardy could be avoided lhroush habitat creation, censusing and surveying nesting areas, 

public information and education, and scheduling reservoir water releases 10 avoid impacting lhe birds and lheir 

nests. The Corps ~ implemenccd lhese alternatives, and lhe effectiveness of lhese measures can be seen in lhe 

use of lhe Corps<reared nesting habitat. As m:ently as 1993, lhe only least terns nesting below Gavins Point 

Dam were on 18 Corps-made islands, totaling approximately 12S acres. This represented an estimated 27 

percent of lhe IOtal adult least rem nesting population on lhe entire Missouri River sysrem. Success ~ not 

been easy. While meeting lhe primary purposes of flood control and navigation, we have strussled 10 meetlhe 

bird productivity goals, (i.e ., number of youns fledged per nesting pair of adults) set fonb in lbc Fish and 

Wildlife Service biological opinion. Our effons have been made more difficult by period of drousht and 

flooding. For instance, in 199S hish reservoir storage, coupled wilh large inflows resulted in lhe need 10 

evacuate stored Oood waters during lhe nestina season. Worlcing wilh the Service. we coltecccd appro1im&tely 

3SO esss from the river, propagated lhe esss. and released 220 chicks 10 the wild. This action allowed us 10 

meet our flood control responsibility while minimizing monality 10 lhe birds. 

The pallid srurgeon, present in lhe Missouri 111d Mississippi Rivers, was listed under lbc Act as an 

endangered species in 1990. In May 1990 lhC Corps and the U. S. Fish and Wildlife Service entered informal 

Section 7 consultation regarding lhe Missouri River Master Water Control Manual Review and Update (Master 

4 
95 

Manual Review), wllic:b was iniliaced in November 1989. 1be Corps made a decerminatiou dial cbanpalbe 

wacer coouol plan •may affect" lbe incerior Jeuc cem. lbe pipina plover and lbe pallid snqeon and iniliaced 

formal SecliOD 7 coasulcatioo wilb lbe Service oa December 8, 1993. Coasulcatioo wilb lbe Service cootinucs 

u we proc:eed in ~viewina and updaliDa lbe wacer coouol manual. 

GULF INTRACOASTAL WATER.WAY ·WHOOPING CRANE 

A 30-mile portioa of lbe Gulf IDUKOUIII Wacerway in TelliS, includina a 13.1!5-mile JeKb wilbin lbe 

Aransu Nalional Wildlife Reruae. c1011es deslpced critical babicac of lbe endanaered wboopina ctane. 

Crilical babicac is beiDa 1011 ac a race of abouc cwo ac~ per year due 10 erosioo caused by wave aclioo and 

cumncs in lbe wacerway. 1be Fisb and Wildlife Service draft biotosic:at opioioo scaces lbal vessel movemcnl is 

lbe principal cause of wboopins crane babicacloss in Ibis -•· and allbouSb vessel operations - under Coast 

Guard jurisdictiou, lbe Service bas looRd co lbe Corps co ~lve lbc pmblem. In lbc lbon-term, lbe Corps 

GaiYH1011 Dislricc participaled in a voluoceer-supponed pmjeccco fill and place baas of dry cooc~ mix at 

cricical areu aloaJ lbe ~- Also, aboUI 9,300 feet of articulaced coac~ce mal bank pro~Kiioll wu 

coasuucced aloos one crirically erodins •~• in 1992 and 1993. Tbese cwo effons successfully accomplisbed 

lbeir purposes. 1be Galvescoo Dislricc is worJdn8 wilb lbe Corps Wacerways Experimenc Scalioo 10 develop 

bank pmceclioo pmjeccs ucilizina mace rial mulincly dredsed from lbe wacerway. In addilioo 10 cooliuuina lbe 

placemenc of cooc~ce mac procecrioo, oosoina feuibilicy sludies by lbe Corps a~ exanliDina lbe c~lioo and 

~scoralioo of approximacely 1,600 ac~s of marsb for crane babicac, u pan of lbe naviprioo pmjecc's Dredsed 

Macerial Manasemenc Plan. 

CONCLUSION 

As is evidenl from lbc expeodicures and examples provided above, il is clear lbal wilb lbe cOmplcxiries 

or lbe Endanaered Species Ace, lbe public and privace ince~SIS lbac become panncn in implemenlina lbe Ace, 

and lbe ceclmical cballeoses facina lbe Corps, we will coocinuc co devoce sisoific:aot ~un:es 10 lbesc issues. 

1be Corps bas been makina diliSCOC effons, urilizins scace-of-lbe-an equipmeot and cecbniques, co eflicieody 

and effeclively uodenllnd, protecl and ~core endaosered species and lbe communicies and ecosyscems 10 wllic:b 

IIIey belonJ. 

5 
96 

T .. tt-.y of 

Jtolluad A.. Sehllitt-. 

•atioaal Marine Wi8heri.. Service 

•atioaal Oceanic aDd A.t:.o8plleric Adaillhtratioa 

U.S. Depar~t of c-rce 

Before tU 

ec-ittee oa ae.ource• u.s. aou.e of ll.epr .. -.tati, .. 

April 17, ltt6 

Mr. Chairman and Members of the Committee: I am Rolland 

Schmitten, Assistant Administrator for Fisheries, National 

Oceanic and Atmospheric Administration, U.S. Department of 

Commerce, and Director of the National Marine Fisheries Service 

(NMPS) . I appreciate this opportunity to discuss the amount of 

funds the National Marine Fisheries Service has used to conserve 

and recover listed endangered and threatened species under the 

Endangered Species Act (BSA) , as well as the Agency's efforts to 

prevent species from declining to the point where they need to be 

listed under the BSA in the first place. 

pyndina 

Starting with funding ... in FY 1992, NMPS received a total of 

$8.5 million for BSA activities. Due to increased 

responsibilities, primarily the listing of salmon, the amount 

increased to $21.2 million in FY 1996. The Administration's 

funding request for FY 1997 BSA.-related activities is $23 . 5 

million. These funds are for the entire NMPS BSA program, 

including recovery, listing status and review, research and 
97 

enforcement activities. Attached to this testimony is a chart of 

HMFS' BSA funding history over the last 5 years. 

The cost of recovery for some species may seem overwhelming, 

but this is a reflection of the peril faced by species at the 

time of listing. Most species come under the protection of the 

BSA when they are already endangered or threatened with 

extinction, so that recovery takes many years, even generations. 

However, even if unlimited funding were available, our goal 

should be to prevent species from becoming threatened or 

endangered in the first place . 

However, NMFS is using every available resource it has to 

prevent the need to list marine and anadromous species. One of 

these resources is the Magnuson Fishery Conservation and 

Management Act (Magnuson Act). Through this Act, NMFS has a 

unique association with the fishing industry, constituent groups, 

states, tribal agencies and other Federal organizations also 

charged with the development of fishery harvest policy located/ in 

Federal or state waters. For example, in 1993, NMFS proposed to 

list harbor porpoise in the Gulf of Maine as threatened under the 

BSA primarily due eo the large bycatch of this species in the 

Gulf of Maine gillnet fishery. However, since 1992 and prior to 

any determination regarding an BSA final listing, NMPS and the 

Northeast Fishery Management Council have been working together 

through .the Magnuson Act and the current Marine Mammal Protection 

2 
98 

Act (MMPA) take reduction team process to reduce bycatch to a 

level that is sustainable to the population and will not require 

that the species be listed. 

The NMFS habitat conservation program also provides many 

avenues for promoting recovery and conservation. The recent 

National Research Council report on science and the BSA stated 

that protection of habitat is absolutely crucial to the survival 

and recovery of species. Without habitat protection, a species 

cannot survive, and it cannot recover. There is no alternative. 

Bach year, the NMFS habitat conservation program reviews and 

provides advice on thousands of individual actions that affect 

habitat. By being involved early in the planning process, NMPS 

can save valuable fishery and other living marine resource 

habitats. One important example is to use our authority under 

the Federal Power Act to require passage of fish around 

hydroelectric . dams . 

The NMPS Restoration Center guides NOAA's efforts to restore 

damaged and degraded habitats. The Center has had a number of 

well-recognized successes in a variety of important areas that 

support endangered and threatened species. For example, the 

Center coordinated the NMPS role as a Federal sponsor for 

wetlands restoration in Louisiana and last year completed a major 

coral reef restoration project in the Florida Keys. 

3 
99 

Under the Marine Mammal Protection Act, NMPS takes action 

before BSA listing is necessary. For exaaple, under the MMPA, a 

conservation plan has been developed for depleted northern fur 

seals which includes management measures to stem further 

declines. Similarly, an MMPA conservation plan for the northwest 

Atlantic coastal migratory stock of bottlenose dolphins is being 

developed. This stock of bottlenose dolphins experienced by a 

large die-off in 1987-88. AD MMPA conservation plan for harbor 

seals in southeast Alaska is also being developed. That stock of 

harbor seals has shown a major population decline, and HMPS wants 

to identify and correct any problems before it becomes necessary 

to list the stock under the BSA. 

Purther1 witb coogresaioaal fUIIding in 1994 and 19951 HMPS 

is developing criteria that~ be uaed to delist or ~ fraa 

.,...ngend etatus all)' of tbe large wbal.e species. Several 

.,...ngend wbal.u were lieted u a result of ~rcial wbal.ing 

threats. Witb tbe i~ate threat of wbal.ing gcllle1 lltPS 1a 

reviewing tbe etatue of ..ay species with tbe intent to propose a 

c:Mnge in BSA statue. 

any ... 1. 

'!'be Jlortb Pacific populatica of gray wbal.e _. ~ fraa 

tbe .,...ngend speciu liet after its populatica iDcreued frcia 

·fewer than 101 000 in the lt30s to 211 000 in ltt4. I ~d like 

to -....be tbet tbe recovezy of tbe gray wbale did ~ happen 

• 
100 

overnight. It was a long process and certainly the MMPA and the 

BSA were crucial in preventing its extinction. 

Di•ea•• MOnitoring 

Under the Marine Mammal Health and Stranding Response Act, 

NMFS is making an effort to detect potential problems before they 

become major issues. As part of this program NMFS is monitoring 

contaminant levels in marine mammals. The program has also been 

successful in detecting serious diseases in marine mammal 

populations before major epidemics occur. F~r example, phocine 

distemper virus has been found in east coast seals. 

Retrospective analyses determined that the disease has been 

present in the population for some time and that we are unlikely 

to see the type of epidemic that killed over 17,000 seals when 

the same disease was introduced into Burope in 1988. 

morbillivirus has been detected in dolphin populations off the 

Atlantic and Gulf coasts. Just this Fall, the first evidence of 

Morbillivirus. was found in a dolphin population in the Pacific 

Ocean. We found evidence of exposure in four common dolphins 

that stranded in California. NMFS is currently sponsoring 

research on brucellosis in harbor seals in the State of 

Washingt~n. 

Take Reduction T .... 

Under the 1994 amendments to the Marine Mammal Protection 

Act, NMFS is developing and implementing Take Reduction Plans 

5 
101 

designed to assist in the recovery or prevent the depletion of 

stocks which interact with fisheries. Some fisheries interact 

frequently or occasionally with marine mammal stocks that are 

designated as endangered or threatened under the BSA, depleted 

under the MMPA, or whose level of human-caused mortality exceeds 

the stock's calculated Potential Biological Removal (PBR) level. 

Take Reduction Teams are producing plans that will lower the 

levels of mortality caused by incidental interactions between 

fisheries and marine mammal stocks. 

Take Reduction Teams have been formed for 1) the Gulf of 

Maine harbor porpoise, 2) Atlantic offshore cetaceans (including 

right whales and humpback whales, both listed as endangered under 

the BSA), an~ 3) Pacific offshore cetaceans (including sperm 

whales, listed as endangered under the BSA). The Teams are made 

up of individuals who represent the span of interests and 

affected parties impacted by these decisions, including the 

commercial and recreational fishing industries, fishery 

management councils, interstate fishery coamissions, academic--~ 

scientific organizations, state officials, native Alaskans or 

other Native American interests if appropriate, environmental 

groups, and NMPS representatives. 

NMPS anticipates that the implementation of Take Reduction 

Plans will result in the immediate reduction of fishery-related 

incidental serious injuries and mortalities to below PBR for all 

6 
102 

strategic stocks affected, and to insignificant levels 

approaching a zero mortality and serious rate within five years. 

This will aid in recovery efforts for listed stocks and prevent 

the fishery-related depletion of stocks which are in danger of 

being listed as threatened or endangered in the future. 

Sea Turtles 

NMPS and the Fish and Wildlife Service (PWS) share 

jurisdiction and responsibility for endangered or threatened sea 

turtle species. NMPS emphasizes conservation efforts in the 

marine environment while PWS focuses its efforts on nesting 

beaches. Due to the wide distribution and migratory habits of 

sea turtles, it is only through collaborative efforts with the 

southeastern coastal states and international cooperation such as 

we have with Mexico that we can hope to recover sea turtle 

populations. NMFS recovery efforts are much broader than the 

widely publici~ed TBD requirements for shrimp vessels and include 

assessing impacts of long line fisheries and flounder trawling 

fisheries, support for research into a deadly disease causing ./ 

tumorous growths on green turtles, and collaboration with the 

Corps of Engineers to reduce mortality from dredging activities. 

Because of vigilant protection of nesting turtles and nests 

in Mexico and restrictions on shrimping activities in both our 

countries, the most endangered sea turtle, the Kemp's ridley, is 

turning the corner and its decline towards extinction is being 

7 
103 

reversed. There is also encouraging evidence that the nesting 

population of green turtles in Florida is increasing. Nbile the 

U.S. population of loggerheads, which is the second largest in 

the world, appears stable, we are gravely concerned about 

juvenile and sub-adult mortality from long line fisheries in the 

Mediterranean and eastern Atlantic. We are similarly concerned 

about impacts of Pacific long line fisheries on leatherback& 

which are experiencing dramatic declines in the Pacific. 

These examples demonstrate that persistent and strong 

conservation measures carried out in collaboration with other 

nations can effect sea turtle recovery but they also point out 

that there are still significant unresolved threats which require 

major efforts if recovery is to be sustained in the long term. 

Sa~ aDd tlae UA 

There have never been fewer salmon in the Columbia River 

basin than today. Although actions have been taken to halt the 

decline, it continues. Since the Snake River listings, HMPS b•s 

proposed to list several populations of coho and steelhead. 

Before these become final listings, HMPS is taking steps in 

cooperation with other Federal agencies to reduce the economic 

impact of the listings and achieve regional consensus on bow to 

best proceed with conservation efforts. 

8 
104 

For all Northwest salmon species, whether listed, proposed 

for listing, or candidates for listing, NMFS is using its 

resources to ensure better public participation, ·fairness, and 

certainty. To create partnerships, NMFS works closely with state 

and local governments, tribal groups, industry organizations and 

private property owners. In fact, when NMPS announced its 

proposed listing for coastal coho salmon populations, 

representatives of the Governors of California, Oregon, and 

Washington participated in the announcement and pledged the 

commitments of the three states to assume a lead role in 

developing state-based conservation strategies in partnership 

with Federal and tribal authorities. This conservation 

partnership is opening a new era that reflects many of the 

recommendations of the Western Governors• Association concerning 

the BSA. 

Throughout the Pacific Northwest local •watershed councils" 

have been forming. These councils are generally driven by 

private citizens taking voluntary actions to improve salmon 

habitat. 

Much of the salmon habitat in the Pacific Northwest is 

located on large tracts of privately owned commercial timber 

stands. Large landowners have the ability to make a real 

difference in a watershed through their land management 

activities. Also, they have the technical and financial 

9 
105 

resources to conduct watershed analyses and develop comprehensive 

watershed plans. 

Last Fall the Administration announced its •No Surprises• 

policy, under which landowners who develop an approved habitat 

conservation plan (HCP) for any threatened or endangered species 

will not be subject to later demands for a larger land or 

financial commitment if the plan is adhered to--even if the needs 

of any species covered by the plan increase over time. A 

landowner who agrees to provide for the long-term conservation of 

species in accordance with an approved HCP is assured that 

activities on the land can proceed without having any addition 

mitigation requirements imposed, except as provided under the 

terms of the plan itself. Species that are not yet listed are 

also being covered under the umbrella of an HCP and, if listed, 

the landowner, state or local government does not have to take 

additional protective measures if the species is already included 

in the HCP. One of the benefits is that it provides the 

predictability that the private sector needs. 

Also, I am proud to report that NMFS and the Fish and 

Wildlife Service have coordinated development of HCPs to allow 

private landowners the advantage of one-stop shopping. Both 

staffs are located in one office in the Pacific Northwest and 

literally work side by side for efficiency and coordination . 

10 
106 

NMFS is integrating conservation measures on Federal and 

non-Federal lands. The development of HCPs on non-Federal lands 

that supplement the protective conservation measures in place on 

Federal lands is central to this effort. NMFS fishery biologists 

work directly with HCP applicants to assess fish habitat and 

stream conditions on their lands, and assist applicants in 

preparing conservation plans, including both riparian buffers and 

road management strategies, that meet both the needs of listed, 

proposed or candidate species and the landowners. CUrrently, 

NMFS is working on about 35 HCPs that cover a land area of over 6 

million acres. 

Rather than wait until a species is listed to address 

potential adverse effects of land management activities, NMFS 

believes it is beneficial to incorporate conservation efforts 

early on. While NMFS can provide leadership as the Federal 

marine resource agency, from so to 90 percent of all the habitat 

of species proposed for listing is bordered by non-Federal lands, 

much of it consisting of private timber stands. Therefore, 

private actions must play a significant role in restoring the 

health of these species. Incentives, such as those provided by 

HCPs, are important to encourage landowners to participate in the 

recovery of species. The threat of an BSA listing with the 

resulting consequences should not be the driving force in 

enlisting this participation. 

11 
107 

Recoveey of Sa~ 

One of the most important UDdertakings for salmon in the 

Pacific Northwest will be the development and implementation of 

the NMFS Recovecy Plan. CUrrently published as a proposed plan 

for which public comment has been solicited, this comprehensive 

document proposes to set forth a course of action that is 

intended not only to recover threatened and endangered salmon, 

but to create a management policy that will remove the need for 

further salmonid listings. 'l11e proposed R.ecovecy Plan approaches 

the ecosystem as a whole. It proposes to include tasks that will 

have beneficial effects on all aquatic species in the Snake River 

system. The proposed Plan is baaed on principles of adaptive 

manag..ent which allows IMPS to continually update our approach 

as new info:r.ation ~s availllble. lleV data will be applied 

to the benefit of all species sbariag the Snake River syat ... 

A Pacific Sal- Task Force operatiDg out of lfaahiDgton, 

D.C. is establiahiag overall policies and coordination for 

recovery. '1'be taak fore. highligbts tbe President's coac:em that 

Federal coordination abould focus aa tbe urgent issue of aalwm 

recovery. '1'be task force will enaura that cabiDet-level 

executives an not aaly intorMd, !Nt involved with the efforts 

to natore Pacific aal-. ODe of tbe priary goals of tbe task 

force is to allay tbe states' concern over uncoordinated 

reaponaea -.mg the agencies involved. 

12 
108 

Another group, the Pacific Salmon Coordinating Committee, 

operates on the west coast under the leadership of the NMPS 

Northwest Regional Director. This group coordinates and 

implements Federal efforts on the west coast. A Memorandum of 

Understanding that created the Committee recognizes that 

•intergovernmental• efforts include coordination with the states, 

tribes and private stakeholders. One of the most important goals 

of the committee is to find incentives for private landowners to 

become a part of the restoration effort . 

The National Academy of Science's report on salmon confirms 

that our fundamental approach to Snake River recovery is solid 

and based on the best science available . Despite the political 

controversies and legal battles, NMFS has forged a proposed Plan 

that uses this science in a comprehensive manner as a foundation 

for its proposed recommendations, in keeping with the original 

intent of Congress in requiring recovery plans. 

The people of the Pacific Northwest are proud of their 

abundant natural resources and have demonstrated through 

countless community projects their dedication to restoring the 

once legendary Pacific salmon runs . Given adequate information, 

technical assistance and funding, grassroots efforts to protect 

and restore salmon habitat can play a fundamental role in 

rebuilding this precious resource. Salmon is the icon of quality 

of life in the Northwest, and quality of life is one of the 

13 
important features of the economic engine of the west coast which 

makes the loss of salmon unthinkable. 

Atlautic Sat.oa 

Not all salmon recovery efforts are taking place in the 

Northwest. CUrrently, in the northeastern United States, NMFS is 

working on recovering Atlantic salmon which has been proposed for 

listing under the BSA jointly by NMFS and the Fish and Wildlife 

Service. One of our efforts is to work with the State of Maine 

on a conservation plan that addresses net pen aquaculture, 

recreational fishing, and agriculture impacts on wild stocks of 

Atlantic salmon. 

Conclusion 

Through partnerships with public and private groups and 

through the resources within our own agency such as the Magnuson 

Act and the Marine Mammal Protection Act, NMFS is using every 

tool it has to prevent listings and to recover those species that 

are listed. We plan efficient use of our BSA funding. Often, 

funds spent for a listed species also reduce the need for another 

species to be listed. Our participation in international 

treaties such as CITBS and the International Whaling Convention 

facilitates U.S . efforts to recover species. We consider the 

effects of the actions of our entire agency on ecosystems and 

watersheds. In the long-term, these conservation actions will 

have a major beneficial impact on the economic, cultural and 

14 
110 

recreational opportunities in every region of the nation. In the 

short-term, these conservation strategies can reduce economic 

impacts and increase certainty for private property owners, 

industry, and local, state and Federal government agencies. 

However, as much as I would like to say that we no longer need 

the BSA, there continues to be an unprecedented increase in 

extinction of species in this nation and throughout the world. 

On the other hand, I am encouraged when I can report to you about 

so many public and private groups that are dedicated to 

preserving their natural heritage. 

Thank you, Mr. Chairman. This concludes my testi1110ny. I 

will be pleased to answer any questions you -Y have. 

15 
Species apecific1 

program•, project•, 

YY92 

$8.5M 

$7 . 0M 

activities, • salaries 

111 

YY93 YY94 

$8.8M 

$7 . 4M $7.0M 

YY95 PY96* YY97 (requeeted) 

$17.0M $21. 2M $23.5M 

$8.6M $7 . 7M $8.2M 

Enforcement $0.3M $0.3M SO . SM $0.5M $0.5M $0.SM 

Recovery--planning, 

implementation, 

• monitoring 

Northwest salmon 

Other listed species 

Listing ' status 

reviews 

$0.2M $0.2M $0.2M $7 . 0M $ll . OM $14 . 8M 

$1.0M $0.9M $0 . 9M 

($4 . 0M) ($10 . 0M) ($10 . 0M) 

($3 . 0M) ($3 . 0M) ($4 . 8M) 

$0 . 9M $0 . OM' $0 . 0M 

Baaed on continuing resolution funding 

1 Including, for example, Hawaiian monk seals, Hawaiian sea turtles, steller sea lions, Columbia River endangered species studies, Sacramento River winter-run chinook and protected apeciea studies. 

2

Punding of $0 . 9 million included under specie• •pecific (eee footnote 1). 

16 
112 

STATEMENT OF 

JACK WARD THOMAS, CHIEF 

FOREST SERVICE 

UNITED STATES DEPARTMENT OF A~RICULTURE 

Before the 

Committee on Resources 

United States House of Representatives 

Concerning Forest Service Implementation and 

Administration of the 

Endangered Species Act of 1973. as Amended 

Washington, D.C. 

April 17, 1996 

MR. CHAIRMAN AND MEMBERS OF THE COMMITTEE: 

Thank you for the opportunity to discuss how the Forest Service is 

implementing and administering the Endangered Species Act of 1973. 

Background 

As you know, the Forest Service conserves species and the 

ecosystems upon which they depend on behalf of the American people 

as directed by law and regulation. The Endangered Species Act 

(ESA) and the Resource Planning Act of 1974, as amended by the 

National Forest Management Act of 1976, are the primary laws we 

follow to protect species. The Multiple Use Sustained Yield Act 

of 1960 and the Resource Planning Act of 1974, as amended by the 

National Forest Management Act of 1976, in concert with the 

Endangered Species Act, define the breadth of our conservation 

responsibilities. 
113 

These laws require management of 191 m~~~ion acre s of National 

Forests and Grasslands to sustain a broad array of benefits. It 

is the interaction of these laws that act in concert with others 

that define and authorize the duties and actions the Forest 

' Service takes to provide these multiple benefits . 

Forest Service authority to manage for multiple uses is found in 

the Multiple Use Sustained Yield Act of 1960 which states that the 

Secretary of Agriculture is authorized and directed to develop and 

administer the renewable surface resources of the National Forests 

for multiple use and sustained yield . In addition, the Act states 

that 

" It is the policy of Congress that the National Forests are 

established and shall be administered for outdoor recreation, 

range, timber, watershed, and wildlife and fish purposes." 

This is to be accomplished 

"without impairment of the productivity of the land, with 

consideration being given to the relative values of the 

various resources, and not necessarily the combination of uses 

that will give the greatest dollar return or greatest unit 

output. • 

2 
114 

The Endangered Species Act of 1973 was enacted to 

•provide a means whereby the ecosystems upon which endangered 

species and threatened species depend may be conserved [and) 

to provide a program for the conservation of such endangered 

species and threatened species.• 

Section 7 of the Endangered Species Act requires federal agency 

consultation with the Fish and Wildlife Service and National 

Marine Fisheries Service to carry out species conservation 

programs to ensure that agency actions or prospective actions do 

not jeopardize the continued existence of any listed or proposed 

species for listing or result in destruction or adverse 

modification of any designated or proposed critical habitats. 

The National Forest Management Act of 1976 requires the Forest 

Service to develop, maintain and revise plans for units of the 

Natidnal Forest System and 

•assure that plans ... provide for diversity of plant and 

animal communities based on the suitability and capability of 

the specific land area in order to meet overall multiple-use 

objectives .... 

3 
115 

Taken together, these laws prov .. '"'e the basJ. :o: 

Forest Service programs I will now describe. 

· _;.i aut.<' ':.y fur t.he 

Many, perhaps most, 

of the costs associated with carrying out the requirements of the 

Endangered Species Act are necessary to meet agency obligations 

under the Multiple Use Sustained Yield Act, National Forest 

Management Act and the cumulative effects provision under the 

National Environmental Policy Act. 

Forest Service Programs 

There are pitfalls in examining one Forest Service program 

separate from all Forest Service programs. In many cases programs 

cannot exist independently of others, and meet the multiple 

objectives and constraints of all applicable laws. 

The threatened and endangered species program exists to assure 

protection and conservation of species (and the ecosystems on 

which species depend) while providing and contributing to the 

sustenance of other uses such as forage for livestock, trees for 

wood products, recreation opportunities for hunting and fishing, 

wilderness and bountiful clean water for on-Forest and downstream 

use. To this end, consideration for threatened, endangered and 

sensitive species is interwoven in all aspects of Forest Service 

activities. 

There are four major administrative areas in the Forest Service --

4 
116 

the National Forest System, Forest Service Research, Private 

Forestry and International Forestry. Each area has 

responsibilities in implementing ESA. 

The agency must meet the diversity of species goal in the 

regulations pursuant to NFMA. To that end, the Forest Service has 

a threatened and endangered species program (pursuant to ESA) and 

a sensitive species program (pursuant to NFMA and ESA.) In the 

budget, these programs are tracked as a single entity since many 

of the protection and mitigation measures, habitat restoration and 

enhancement projects, and research and inventory work overlap. 

Work conducted on any threatened, endangered, or sensitive species 

will also hold benefits for other species with which it is 

ecologically associated. 

However, some portion of every program in the Forest Service is 

related to protecting species diversity and providing human 

benefits. These costs are part of achieving the Agency ' s mission 

as defined by law. These costs can not be easily separated nor 

tracked as a cost item attributable solely to sustenance of 

threatened and endangered species. 

For example, the portion of the cost to control wildfires that 

benefits such species can also benefit other resources (such as 

watersheds and timber) or save facilities. Therefore, the costs I 

report today for the specific threatened, endangered and sensitive 

species program likely do not include costs for maintaining those 

5 
117 

species reported under other programs such as range, fire, and 

forest pest management. In addition, because of the integrated 

nature of Forest Service work, we now have a budget line item for 

ecosystem planning, inventory and monitoring, which includes 

expenditures that may also benefit threatened and endangered 

species. 

The Forest Service's threatened, endangered and sensitive species 

program goals are: 

· To promote the recovery of listed species through habitat 

improvement, ecosystem restoration, and habitat protection. 

- To prevent the need to list additional species under the ESA 

through management action and research. 

- To coordinate with other resource areas, such as timber and 

range, to ensure sustainable production of commodities. 

· To provide high quality conservation education to the public 

and users of the National Forests. 

· To provide research to understand the needs of species and 

the impact of human activities and natural events on species 

and their habitat. 

Our goal is to implement and administer the threatened, endangered 

6 
118 

and sensitive species program in the most effective and efficient 

manner to meet agency objectives. 

For instance, we have joined in partnerships with other agencies, 

private organizations and the public. In 1995, 55\ of the stream 

inventories, 27\ of the lake and terrestrial inventories, 21\ of 

the structures built, 33\ of the education presentations,and sot 

of the interpretive sites constructed were partially funded from 

partnerships. Of 12 . 1 million dollars spent, 7 . 1 million dollars 

came from partners. 

We have streamlined section 7 consultations under the BSA. This 

has been a cooperative effort between the United States Fish and 

Wildlife Service (FWS), National Marine Fisheries Service (NMFSl, 

Bureau of Land Management IBLM), Environmental Protection Agency 

(BPA), and the Forest Service . Barly involvement of these 

agencies in the planning phase of project development has led to 

shortened time frames for consultation which we expect will 

provide significant cost savings. This approach has been very 

successful. Por example, in the Pacific Northwest, with few 

exceptions, informal consultations are completed in less than 30 

days. Formal consultations are completed in less than 60 days. In 

PY 1995, consultations in western Oregon averaged 33 days. 

Nationwide, there is no known backlog in consultation, which is a 

.ajor accQ.plishment in improving the efficiency of the Endangered 

Species Act. 

7 
119 

Forest Service Research has also be . improvJ.ng e .veness c1.nd 

efficiency by designing research projects that enc- ... -SS 

communities, landscapes, and ecosystems, as encouraged by the 

Endangered Species Act. There are many examples of research 

projects which have used this approach to generate scientific 

information to be used by the Agency for management purposes. For 

instance, the guidelines for the northern spotted owl have been 

expanded to accommodate the needs of over 1400 species associated 

with old-growth. Other examples are the goshawk guidelines which 

will provide for the protection of this sensitive raptor species 

as well as over 30 of its prey species. 

In FY 1995, 20 . 5 million dollars have been expended to manage 

threatened and endangered spec.ies out of a total appropriated 

program of 23.6 million dollars which includes sensitive species 

protection. However, an additional 11.5 million dollars was spent 

to protect sensitive species from other programs as needed to 

implement forest management activities. Research costs for 

threatened, endangered and sensitive species were 9.6 million 

dollars. The specific threatened, endangered and sensitive 

species program comprises less than 5 percent of the Forest 

Service FY 1995 budget. 

8 
120 

Accomplishments and Future Needs 

The Forest Service has been successful in protecting and improving 

conditions for many threatened and endangered species throughout 

the United States and has been instrumental in focusing attention 

on international conservation efforts. With help from the Forest 

Service, the bald eagl e, pergrine falcon, grizzly bear, eastern 

timber wolf, black·footed ferret, Puerto Rican parrot, red 

cockaded woodpecker, and greenback cutthroat trout have been 

brought back from the brink of extinction. Several of these 

species have been or are under consideration for being 

reclassified from Endangered to Threatened status. 

It should be noted that threatened, endangered and sensitive 

species programs benefit not only species but also lead to other 

benefits for people through improved water quality and soil 

productivity, sustained economies through sustainable resources, 

enhanced recreation opportunities and preserved sources of genetic 

and raw materials for agricultural and industrial products, to 

name but a few. 

About one-third of all species currently listed under the ESA 

exist on National Forests and Grasslands. As human population 

pressure and development increase, Federal lands will become 

increasingly important to the survival of threatened and 

endangered species. 

9 
121 

Conclusion 

Forest Service programs are moving toward an ecosystem approach to 

management of National Forests in order to better simultaneously 

meet the objectives set forth in the Multiple Use Sustained Yiell 

Act, Endangered Species Act and the National Forest Management 

Act . I believe this approach is an effective and efficient way to 

achieve these objectives to best meet the needs of the public. 

By maintaining or restorir.g ecosystems, the productivity of the 

land will not be impaired and the ecosystems upon which plant and 

animal species depend will be functioning properly. Thus the 

ecological foundation is in place from which multiple benefits can 

be derived over time . Without natural systems functioning 

properly -- these multiple benefits will be at risk. Investments 

made today will provide long term benefits in the future and will 

cost the public less in the long run. 

This concludes my prepared remarks. I would be happy to answer any 

questions you may have. 

ll 
122 

STATEMENT OF JACK ROBERTSON 

DEPUTY CHIEF EXECUTIVE OFFICER 

BONNEVILLE POWER ADMINISTRATION 

UNITED STATES DEPARTMENT OF ENERGY 

BEFORE THE 

U.S. HOUSE OF REPRESENTATIVES 

COMMITTEE ON RESOURCES 

April17, 1996 
123 

Chairman Young, thank you for the opportunity to present the views of the Bonneville 

Power Administration (BPA) before the House Committee on Resources. I am 

Jack Robertson, Deputy Chief Executive Officer of BP A. 

My statement today will include a brief discussion of BP A's history. I will also provide 

information to the Committee on the amount of fish and wildlife funds that are 

(I) appropriated to other federal agencies and repaid by BPA, and (2) spent directly by 

the BP A to administer, implement, conserve and protect endangered or threatened species 

or funding of efforts to prevent species from needing the protection of the Endangered 

Species Act (ESA). 

Profile of Bonneville 

BoiUleville was created to market power from the Federal hydroelectric resources in the 

Columbia River Basin. BoiUleville's operations are completely funded by revenues from 

the sale of energy and transmission services. Under the 1974 Federal Columbia River 

Transmission System Act, BoiUleville deposits revenues from energy and transmission 

'sales into the Bonneville Fund at the United States Treasury (Treasury), and is 

responsible for repaying the Federal investment in the Northwest hydroelectric system 

with these revenues. BPA does not receive annual Federal appropriations. The Federal 

investment which BoiUleville is responsible for repaying does include investments made 

by other Federal agenci~s (Corps of Engineers, Bureau of Reclamation, United States 
124 

Fish and Wildlife Service (USFWS)) in hydroelectric facilities including measures 

designed to mitigate for Federal hydroelectric development damage to the fishery 

resource. 

In 1980, the Northwest Electric Power and Planning Conservation Act (Northwest Power 

Act) was signed into law. That law, as well as other statutory directives, requires that 

Bonneville provide mitigation to the fish and wildlife resources damaged as a result of 

Federal hydroelectric development within the Columbia River Basin. The Act also 

establishes the Northwest Power Planning Council (Council), a body composed of two 

representatives from each of the states of Washington, Oregon, Idaho, and Montana. The 

Council is entrusted with the responsibility of developing a fish and wildlife program that 

protects and enhances fish and wildlife in the Columbia Basin. The Region's 13 tribes 

believe the program helps fulfill the United States' treaty and trust responsibilities. 

Bonneville is required to act consistent with the program developed by the Council. The 

Council has adopted a series offish and wildlife programs, the most recent of which was 

adopted in December 1994. Consequently, Bonneville has fish and wildlife mitigation 

responsibilities that extend beyond those required under the ESA. 

Prior to 1990, the Council program included significant measures designed to improve 

the health of salmon as well as other fish and wildlife. Despite these actions particular 

salmon stocks continued to decline. In 1990, the first petition for the listing of a 

Columbia Basin salmon stock was received by the National Marine Fisheries Service 

2 
125 

(NMFS). By 1993, NMFS had decided to list three Columbia Basin salmon stocks as 

threatened or endangered: Snake River sockeye, Snake River spring/summer chinook 

and Snake River fall chinook. In addition, in 1994 the USFWS listed the Kootenai River 

white sturgeon as an endangered species. During the petition processes and following the 

listing decisions the Council developed new fish and wildlife programs that incorporated 

additional measures to aid salmon and sturgeon recovery. Starting in 1993, NMFS issued 

the first of several biological opinions identifying measures that are necessary to avoid 

threats to the continued existence of the species. There is significant overlap in the 

measures called for in the NMFS biological opinions and the Council program. 

BP A Funding of ESA Related Activities 

Since 1991, SPA's fish and wildlife expenditures have increased dramatically. These 

increases, along with dramatically decreasing prices from alternative electric power 

suppliers in 1994 and 19.95, led BPA customers to consider buying electric power from 

entities other than BP A. In order to help assure a healthy BP A and a recovery of 

dwindling salmon runs in the Northwest, Administration officials developed a plan for 

identifying the actions necessary for the fisheries while limiting the exposure of BPA 

ratepayers to increasing fish and wildlife costs. Those discussions resulted in an October 

1995 letter from Office of Management and Budget Director Alice Rivlin to Senator 

Mark Hatfield that established expected BPA funding levels for all its fish and wildlife 

mitigation responsibilities and fallback mechanisms should court orders lead to additional 

3 

24-936 96-5 
126 

costs for BPA. Under that agreement, BP A will, over the next six years, provide an 

average of approximately $250 million per year in direct expenditures and will incur an 

average of approximately $183 million annually in power costs and foregone revenue. 

These annual power costs and foregone revenues could range from approximately 

$90-280 million depending on weather and water conditions and the prices of alternative 

electric power supplies. 

The Administration believes that with these funds (I) adequate measures will be taken to 

protect ESA listed salmon and sturgeon stocks in the Columbia Basin, (2) the 

hydrosystem operations prescribed in the NM,FS and USFWS opinions will be met, 

(3) the implementation of the Cmmcil plan will proceed unimpeded, and (4) BPA will be 

able to continue to repay the Treasury for Federal appropriations provided to other 

Federal agencies for fishery activities that mitigate damage caused by Federal 

hydroelectric facilities. 

BPA's submittal to you of March 14 identifies estimated costs incurred by BPA that are 

required by the ESA. In addition, in an attachment, it identifies the total expenditure 

BP A is making for fish and wildlife activities under all its statutory obligations. These 

total costs, estimated to average $435 million over the six years, FY 1996 !hrough 

FY 2002, are based on the Rivlin to Hatfield letter mentioned earlier and are consistent 

with the estimates provided to you by the Council. There are essentially three types of 

fish and wildlife mitigation actions that create ,costs for BPA. These actions are; 

4 
127 

(1) operational changes to the hydroelectric system designed to increase river velocity or 

improve dam passage, (2) direct expenditures by BP A for measures such as fish 

hatcheries, (3) expenditures made by other Federal agencies for which BPA has the 

responsibility to repay. 

It is important to note that in the absence of the ESA, many of the costs identified by 

BPA as required by the ESA might still be undertaken as a result ofBPA's obligations 

under the Northwest Power Act or other statutes. 

It should also be noted that the Administration has agreed that costs incurred by BPA, 

which should have been allocated to other non-power purposes, will be credited to BPA 

ratepayers. When BPA makes expenditures for fish and wildlife it does so on behalf of 

the entire Federal hydrosystem, including non-power purposes such as irrigation, 

mitigation and flood control. Yet, BPA ratepayers by law are not responsible for paying 

for costs associated with the non-power features of Federal hydrosystem facilities. The 

Administration agreement, therefore, also will lead to an approximate $60 million annual 

credit to BPA 's payment to the Treasury. This further reduces the effect of fish and 

wildlife expenditures on ratepayers. 

5 
128 

Conclusion 

BPA recognizes that there are others variables involved in mitigation and recovery such 

as harvest, habitat and hatcheries. Others, such as fishermen, are also paying in terms of 

reduced catches, however, BPA believes the costs of fish and wildlife mitigation for the 

Federal hydroelectric system are appropriately borne by the beneficiaries of that system. 

The Administration is proud to have reached an agreement which should provide 

adequate funding to mitigate for damage done by Federal hydroelectric facilities to the 

Columbia River fish and wildlife resource, including threatened and endangered species 

within the system, while also limiting the exposure for Northwest ratepayers. 

Mr. Chairman, this concludes my formal statement. I welcome any questions you may 

have. 

6 
129 

TESTIMONY of the 

NATIONAL WATER RESOURCES ASSOCIATION 

Presented by 

DAVID F. MAZOUR and WILLIAM T. PITTS 

before the 

HOUSE RESOURCES COMMITTEE 

APRIL 17, 1996 
130 

Mr. Chairman, members of the Committee, thank you for offering us the 

opportunity of presenting our views on the Endangered Species Act and in 

particular costs to our members of ESA compliance. My name is David F. 

Mazour. I am the Assistant General Manager for the Central Public Power 

and Irrigation District and with me is William T. Pitts, member of the 

Colorado Water Congress. Together, we are presenting testimony in 

behalf of the National Water Resources Association. Currently we serve as 

Co-chairs of the association's ESA Task Force. NWRA is a national 

organization representing western water users in the 17 states. Our 

member organizations provide water services for municipal, industrial and 

agricultural uses. We seek to provide those services in an efficient and 

environmentally sound manner, taking in to account the needs of fish and 

wildlife. 

NWRA supports the goals of the Endangered Species Act. Protection and 

conservation of all wildlife and in particular, threatened and endangered 

species is a worthwhile national goal. Cost effective and scientifically 

sound measures to protect endangered and threatened species are 

fundamental to an enduring program. Unfortunately, many are losing 

confidence in the Act because of the way it is being implemented. Many of 

our member organizations have been saddled with ESA requirements 

costing millions of dollars that have provided little or no benefit to the 

species. The root cause is that all federal actions are subordinated to the 

Endangered Species Act, including: granting of permits, licenses, loans, 

and operation of federal dams. The power granted to the U.S. Fish and 

Wildlife Service and National Marine Fisheries Service is virtually 

absolute. Science and cost effectiveness have taken a back seat to the power 

granted to federal agencies and field biologists. The present ESA does not 

require balancing of federal responsibilities, the application of sound 

science, or consideration of the economic or environmental impacts of 

actions to protect endangered species. 

Mr. Chairman, our message today is a simple one. The Endangered 

Species Act can either be one of two things: a positive, constructive law 

that will permit economic activity to continue in this Nation side-by-side 

with threatened and endangered species, or it can be a law that impedes and 

thwarts economic activity at great costs to all Americans and still does not 

protect and conserve wildlife and its habitat, especially endangered species . 

From our perspective, the Endangered Species Act has fallen into the latter 

category. 

1 
131 

The members of the NWRA represent an important economic sector of our 

economy. It is a sector of the economy that frequently comes into direct 

contact with the Endangered Species Act and its regulatory burdens. 

The economic development of the Western United States has been based on 

the development of water for agriculture, municipal, industrial, recreation, 

wildlife, arid hydroelectric generation. In many states the entire local or 

regional economy has been built around such projects. For example, in 

South Central Nebraska, my home, Platte River projects support a billion 

dollar agricultural economy that now is threatened because of the 

regulatory impact of the Endangered Species Act on federal relicensing to 

operate these Platte River projects in the future. 

Mr. Chairman, attached to this statement are more detailed descriptions of 

not only the projects in Nebraska, but examples of the impact of the 

Endangered Species Act on major economic activities in Colorado, Idaho, 

Nevada, Utah, and Washington. These are just a few example, but ones in 

which major costs are being incurred in meeting the regulatory impacts of 

the Endangered Species Act. 

In most of these cases, the regulatory costs are simply that: costs associated 

with hiring technical consultants, lawyers, doing studies and tests and 

responding to numerous government requests for information, data, 

reports and economic analyses. In other cases, large amounts of money are 

actually being expended on questionable activities as required by federal 

agencies. It is doubtful whether these expenditures are the most cost 

effective for protecting the species from possible extinction, increasing 

their numbers, or creating the type of habitat that will guarantee their 

continued existence. However, under the current ESA, federal agencies 

can require these expenditures without assurance of benefits to the species. 

The members of the NWRA believe the Endangered Species Act can be 

rewritten in a way that will allow economic activities to continue but in a 

way that will protect and preserve threatened and endangered species and 

their habitat. A statute that promotes sound science and cost effective 

approaches to wildlife protection should be the goal of Congress and we 

urge this committee to enact such legislation. 

Again, Mr. Chairman and members of the committee, thank you for the 

opportunity to share our views on the cost of compliance with the ESA. 

Attachments: 

2 
132 

COLORADO 

The Colorado River Water Conservation District was "required" to commit to releasing 

3,000 acre feet in three out of every five years, of water stored under state decrees for 

delivery approximately 200 river miles downstream to the designated habitat. Ostensibly, 

this is to be an interim use of the water to be returned to the River District after the F&WS 

acquires finn water elsewhere in the Colorado Basin. The 3,000 acre feet are currently 

valued at a subsidized price of $100 per acre foot for delivery in the Colorado River Basin. 

This results in a loss to the project of at least $300,000 three years out of five. 

Name of Organization: 

Contact: 

Address: 

Phone: 

FAX: 

IDAHO 

Colorado River Water Conservation 

District 

Rolly Fischer 

Secretary /Engineer 

Suite #204 

201 Centennial Street 

P.O. Box 1120, 

Glenwood Springs, Colorado 81602 

(970) 945-8522 

(970) 945-8799 

A November 9, 1995 National Marine Fisheries document summarized the estimated direct 

costs to the federal government for the proposed Recovery Plan for Snake River Salmon 

through the year 2001. This is just the first phase of a program that is planned to exist for 

at least another eight generations of the salmon (40-50 years), with costs likely escalating 

over that time. Many recovery tasks were identified as necessary, but because of the 

"adaptive management" concept, they were not defmed nor established. The estimated 

U.S. Government agencies' costs were listed as $2.2 billion through 2001 and this does 

not include Bonneville Power Administration's foregone power revenues for bypassing 

flows for the benefit of salmon. 

The upper Snake River Basin is required by the current Biological Opinion to armually 

provide 427,000 acre feet for flow augmentation and the Bureau of Reclamation is to 

attempt to acquire an undefined additional quantity of Upper Snake River Basin water for 

augmented flow purposes. However, in a fully appropriated system, water is available 

only when snow packs are above normal and the agriculture storage reservoirs are full. 

Both agriculture and salmon experience shortages in drought years. In short water years, 

augmented flows using Upper Snake River water can, in many cases, only become 

available by dry-year leasing or the idling of farm land. 

As a result, the Bureau of Reclamation has estimated that the cost of acquiring 427,000 acre 

feet from the Upper Snake River Basin with 95% reliability is $294 million per year. This 

could result in the removal of 425,000 acres from irrigation and armual indirect (non-farm) 

impacts totaling $44 million. Acquiring the undefmed additional quantity of water in the 

Upper Snake River Basin would of course entail higher costs. For example, the Bureau's 

estimate for obtaining 1.927 million acre feet with 95% reliability includes a federal 

expenditure of more than $1 billion, retirement of nearly I million acres, and indirect costs 

of $151 million per year. 

There are other Endangered Species Act costs incurred but not included in the above 

estimates. The State of Idaho is expected to expend armually above $1 million to 

implement the Endangered Species Act. Water District 10 in the Upper Snake River Basin 

3 
133 

encompasses about 1.2 million acres and expends about $100,000 annually for the 

Endangered Species Act. Finally, the North Side Canal Company, of Jerome, Idaho, 

expends almost $50,000 each year on Endangered Species Act concerns. There are four 

other states and three major water districts and over 50 major canal companies' expenses 

not included. 

Name of Organization: 

Contact: 

Address: 

Phone: FAX: 

NEBRASKA 

CNPPID & NPPD EXPERIENCES 

Idaho Water Users Association; and 

Northside Canal Company 

DeWitt A. Moss, Director 

North Side Canal Company 

269 S. 300E. Jerome, Idaho 83338 

(208) 324-1000 

(208) 324-7391 

The Central Nebraska Public Power and Irrigation District (Central) and the Nebraska 

Public Power District (NPPD) each own and operate hydroelectric projects in central 

Nebraska licensed by the Federal Energy Regulatory Commission (FERC). The two 

districts cooperate and coordinate project operations to facilitate beneficial uses. The 

districts' hydro systems include five hydroelectric plants with generating capacity of 126 

megawatts. Both of the FERC-licensed projects are operated in conjunction with irrigation 

facilities not subject to FERC jurisdiction. The projects' irrigation facilities provide direct 

surface water irrigation to approximately 200,000 acres and groundwater recharge benefits 

to an additional 250,000 acres. Together with acres served by small irrigation companies 

under contracts with the two districts, more than 500,000 acres receive irrigation benefits 

from the projects' operations. Significant fish and wildlife habitat is provided by these 

projects and recreational use of the projects' facilities annually exceeds 1.5 million visitordays. Through energy production, irrigation deliveries, recreational opportunities and 

wildlife habitat, the projects make a significant contribution to the economic well being of 

Nebraska. 

The original 50-year FERC licenses were issued in 1937 and the districts have been 

operating under annual license conditions since 1987. Applications for new long-term 

licenses were filed in 1984 and an amended application was filed in 1990. FERC released a draft Environmental Impact Statement (EIS) in 1992 and a supplement to the EIS was later issued. A revised draft IS was prepared in 1994, subsequently followed by another 

supplement. 

A lawsuit brought by an environmental organization in 1987 alleged continuing significant 

habitat loss for threatened and endangered species. It resulted in an order from the D.C. 

Circuit Court in 1989 that required FERC to consider "rough and ready" interim licensing 

conditions, if appropriate. FERC subsequently ordered interim license conditions for 

NPPD in February, 1990. Central sought voluntary amendments to its license in 1992, 

which included both flow and terrestrial components. FERC subsequently attached the 

conditions to Central's interim license. 

An evaluation of the costs and benefits of the ESA requirements placed on NPPD are instructive. 

4 
134 

FLOW REQUIREMENTS: NPPD was ordered in February, 1990-- pursuant to a 

recommendation from the U.S. Fish and Wildlife Service --to release water stored under 

contract in Lake McConaughy to meet a flow requirements at Grand Island, located 200 

miles downstream. The water released began in late February, and continued until May I 0 

when the order was stayed. Approximately 70,000 acre-feet of water was released during 

this period to provide habitat for the endangered whooping crane. This water had been 

stored tmder state law for irrigation purposes. A three-year water loan was arranged 

between Central and NPPD, averting the potential for crop failure on up to 70,000 acres, 

which potentially would have resulted in losses of over $10 million to NPPD irrigation 

customers. The FWS has not provided any documentation of wildlife benefits from the 

70,000 acre-feet of water that was released. 

LEAST TERN & PIPING PLOVER HABIT AT: NPPD was also ordered in February, 

1990 -- again in accordance with a FWS recommendation -- to construct sand islands in the 

Platte River to provide nesting habitat for the interior least tern and piping plover, even 

though then-current biological information indicated that nesting habitat was not a limiting 

factor for the two species. 

Least terns are endangered and piping plovers are listed as threatened. NPPD, through its 

own initiative, developed a more biologically sound and cost-effective alternative by 

managing sand pits adjacent to the river. While the three riverine islands required by FWS 

cost $27,000 per acre of habitat to construct, they have produced a total of only 21 fledged 

least terns and four piping plovers since 1991. A total of 117 least terns and 42 piping 

plovers fledged from NPPD's two sand pits during the same period. The cost for 

developing and managing the sand pits was $7,400 per acre of habitat. The managed sand 

pits have been less costly to develop and for more effective in fledging young of the two 

species. This is a prime example of federal biologists proposing more costly and less 

effective methods to conserve the species, while resisting the more cost-effective measures 

proposed and developed by the districts. 

Name of Organization: 

Contact: 

Address: 

Phone: 

FAX: 

NEYADA 

Central Nebraska Public Power and 

Irrigation District 

DaveMazour 

Assistant General Manager 

P.O. Box 740 

Holdrege, Nebraska 68949 

(308) 995-8601 

(308) 995-5705 

New lands Project, Fallon, NV 

Cui-ui Sucker Fish/ Pyramid Lake, NV 

Approximately $4.5 million in legal and consulting fees (1975-1995) 

The entire amount has been borne by the water rights owners of the New lands Project. 

Additional attorneys' fees have been paid by the individual water rights owners, that sum 

being estimated to be in excess of $140,000. Other economic impacts resulting from 

implementation of the Endangered Species Act include loss of production, which can be 

estimated at $600 per acre of water not received. It is estimated that those production 

losses, coupled with the economic activity factor established by the University of Nevada, 

Reno, exceed $27 million (26,308 acres x $600 per acre x 1.72 multiplier factor). 

TRUCKEE-CARSON IRRIGATION DISTRICT 

s 
135 

In 1967 the United States listed the cui-ui lake sucker fish as endangered under the first 

endangered species law enacted and the predecessors of the current Endangered Species 

Act. The cui-ui is found in Pyramid Lake which is located within the boundaries of the 

Pyramid Lake Indian Reservation in the northwest portion of the State of Nevada. The 

New lands Project has been blamed for the decline of the level of the lake and, subsequently 

the cui-ui. Since that time, the United States in conjunction with the Pyramid Lake Paiute 

Tribe has flled many litigations against the water right owners in the Newlands Project 

represented by the Truckee-Carson Irrigation District (TCID). 

In 1987, the US modified the operations for the Newlands Federal Reclamation Project 

whereby storage in Lahontan Reservoir was reduced to 2/3 of its maximum capacity, a 

reduction of approximately 80,000 a.f. Lahontan is a reservoir that had been previously 

adjudicated by the federal courts in 1994 as having a right to storage of the full reservoir. 

What's more, Lahontan Reservoir had been paid for by the water right owners within the 

Newlands Project. 

In 1994, the United States declared that the water supply forecast from January-April in 

Northern Nevada was 100%. The US Fish and Wildlife Service therefore requested a 

release of 100,000 a.f. for "attraction flows" in the Truckee River for the cui-ui. TCID 

objected to the forecast; the United States modified their forecast shortly thereafter, but after 

the release of the water for the cui-ui. That year, the water right owners in the Project 

received a maximum of 57% in the Carson Division of the project and 26% in the Truckee 

Division of the Project. 

In 1990, Public Law 101-618 was passed by Congress. That legislation was touted as 

settling 80 years of litigation on the Truckee River; however, it didn't settle any litigation 

for the Newlands Project. It only prevented the water right owners from seeking judicial 

relief from arbitrary and unlawful operating criteria for the Project. (See 209(j)(2) of P.L. 

101-618). The law, however, did provide for additional litigation: 

• In 1993, the pyramid Lake Tribe filed approximately 2,000 lawsuits against 

individual water right owners within the Newlands Project. 

• In 1993, the federal government administratively declared that 215 water right 

transfers that had been approved by the State Engineer of the State of Nevada 

were invalid. The Bureau of Reclamation ordered the Truckee-Carson 

Irrigation District not to deliver water to the users on these transfers. Only 25 

had been sent back to the State Engineer for review; 190 transfers had never 

been determined by a court as being invalid. 

• In 1995, the federal government took the position that the Newlands Project 

facilities could not be used by project water right owners to transport water that 

was privately acquired in 1943 and had been used within the Project previously. 

The United States had agreed to the use of the facilities in an agreement 

incorporated into the decree on the Truckee River. The Department of the 

Interior's "policy" statement was issued to ensure that diversions from the 

Truckee River would not be increased and less water allowed to flow to 

Pyramid Lake. The policy though does not recognize that the District purchased 

that water and increased the flow in the River by the release from Donnor Lake. 

So the Truckee River and subsequently Pyramid Lake would not be adversely 

affected by the diversion ofTCID's privately-owned/stored water; in fact, there 

would be a net impact of zero. 

• In 1996, the District was served with a lawsuit asking for the pay-back of 

1,057,000 acre feet alleged to have been taken from Pyramid Lake. This 

litigation was authorized and sanctioned by Congress in passage on P.L. 101-

6 
136 

618. In fact, the public law even stated that water banking, which would be in 

the best interests of all parties in the Carson and Truckee River Watersheds, 

would not be allowed in Lahontan Reservoir by the District unless the 

"recoupment" issue was resolved to the satisfaction of the Pyramid Lake Tribe. 

Name of Organization: Truckee-Carson Irrigation District 

Contact: Lyman McConnnell 

Address: 

Phone: 

FAX: 

P.O. Box 1356 

Fallon, Nevada 89407 

(702) 423-2141 

(702) 423-5354 

Species: Woundfm Mirmow and Roundtail Chub 

Project: Quail Creek Reservoir 

The Washington County Water Conservancy District has spent in excess of $1 ,000,000 in 

studies relating to the Woundfin Mirmow and Roundtail Chub. This has all been local 

dollars. In addition, this species is impairing the ability of communities in Washington 

County to provide water for growth in a county that is the fourth fastest growing in the 

nation according to recent surveys. This project is also impairing development, 

management and conservation of existing water rights. 

Species: Virgin River Spinedace Mirutow 

Project: Spinedace Cooperative Agreement 

This project contemplates acquisition of instrearn flows in two stretches of streams within 

Washington County for the Virgin River Spinedace Mirutow. The current estimate of costs 

to acquire this water is in excess of $4,000,000. The Washington County Water 

Conservancy District already has committed to this process over $1,000,000 for instrearn 

flows. The State of Utah and US Fish and Wildlife Service have verbally committed to 

raise $1,500,000 of the remaining $3,000,000 leaving another $1,500,000 to be raised 

from other local sources. This is for a species which has wide distribution throughout the 

Virgin River area, but without this cooperative agreement would have been listed. 

Species: Desert Tortoise 

Project: Translocation Study 

A good example of excessive public costs of the Endangered Species Act is a recent 

translocation study being done in Washington County, Utah, for the Washington County 

Habitat Conservation Plan in relation to the desert tortoise. The cost of the study was 

reported to be $750,000. The study is designed to study 90 tortoises over a three to five 

year period. That works out in excess of $8,000 per tortoise for the study. This particular 

cost is being borne entirely by the federal government. The Washington County Habitat 

Conservation Plan for the desert tortoise is costing the local taxpayers in excess of 

$11,000,000. The plan authorizes the county to take 1200 tortoises. The local committed 

costs for the 1200 tortoises is over $9,000 per tortoise. In addition, there are land 

exchanges, purchase of land within the habitat conservation plan and impact of private 

property which has been estimated to be in excess of $200,000,000. The cost of its impact 

to state school trust lands is considerable and estimated to be in excess of $100,000,000. It 

has essentially made 1200 acres of school trust land set aside for the education of our 

children in Washington County completely worthless unless there is money set aside to 

purchase land or the land is exchanged out of the habitat area. 

7 
Name of Organization: 

ContaCt: 

Address: 

Phone: 

FAX: 

WASHINGTON 

Types of projects affected: 

137 

Washington County Water Conservation 

Disuict 

Ronald W. Thompson 

136 North 100 East 

Suite 1 

St. George, Utah 84770 

(801) 673-3617 

(80 1) 673-4971 

The Columbia Basin Project, constructed by the Bureau of Reclamation, is designed to 

irrigate 1,095,000 acres. Facilities are in place to irrigate about 640,000 acres. These 

facilities are operated by the East Columbia Basin Irrigation District, the South Columbia 

Basin District. The listing of the Snake River sockeye salmon as endangered, the Snake 

River spring/summer chinook salmon as threatened and the Snake River fall chinook 

salmon as threatened has impacted the 3 inigation districts both in our ability to fully utilize 

our existing facilities and in our ability to continue with planned expansion of facilities. It 

should be noted that the Snake River is a tributary to the Columbia, downstream of the 

Columbia Basin Project and that the listed species' spawning and rearing habitats are many 

miles away from the CBP. 

The repayment contracts between USBR and the CBP irrigation districts and the 

Washington State water rights granted to the CBP authorize service through existing 

facilities to about 20,000 acres above what is presently served. This spring USBR directed 

the CBP irrigation districts to cease processing any contracts for this additional service. 

The basis for this moratorium was said to be to allow USBR to study the applicability of 

the ESA Section 7 consultation process to the insurance of further water service contracts. 

The Snake River listings have also interrupted, and maybe ended, plans to expand existing 

facilities to provide additional irrigation capacity. The Columbia Basin Project published a 

"Draft Environmental bnpact Statement for Continued Development" in September of 

1989. The preferred alternative in the DEIS proposes to enlarge and extend the existing 

East Low Canal to serve an additional 87,000 acres in the East Columbia Basin Irrigation 

District. Much of the proposed service area is currently irrigated from a declining aquifer. 

This decline would be stabilized by introduction of a surface water supply and would 

prolong the economic life of this aquifer. Besides the irrigation development, the preferred 

alternative includes a number of wildlife habitat enhancement areas that would be added to 

the existing Columbia National Wildlife Refuge. The net water supply for the irrigation 

and wildlife development is estimated to be 216,000 aflyr. The water would be diverted 

from the Columbia River at Grand Coulee Dam where the average annual flow is about 

87,000,000 af/yr. Current CBP diversions at this point are about 2,300,000 to 2,700,000 

aflyr or about 3% of the river's annual flow. The additional water would divert another 

2/10 of 1 percent. Total construction cost is estimated to be $313 million (for both 

irrigation and wildlife components). During late 1989 as the DEIS was being published 

and public hearings were being held, it was becoming public knowledge that regional 

tribes and environmental groups intended to flle petitions proposing ESA listings for 

Columbia and Snake River salmon runs. The DEIS hearings concluded in December 1989 

and the first of five petitions wasn't flied until April of 1990 but the ESA cloud was 

evident during the hearings. 

8 
138 

The DEIS included an analysis of potential adverse impacts to anadromous fish because of 

the additional diversions. This analysis showed that the maximum adverse impact would 

be a 1/2 of 1% increase in mortality of juvenile migrants. The same analysis indicated in 

some cases survival would actually improve by about the same amount. This probably 

means that because of the small proportion of water being diverted the impacts were not 

measurable. During the hearings, tribes, fisheries agencies and environmental groups 

testified that any increase in juvenile mortality was not acceptable and that, in their opinion, 

the DEIS understated these impacts (but none offered data supporting their claims). 

By June of 1990, 5 species (subspecies?) of Snake and Columbia River salmon were 

petitioned to be listed: Snake River (Redfish Lake) sockeye, Snake River spring chinook, 

Snake River sununer chinook, Snake River fall chinook and Lower Columbia coho. In 

1991 the National Marine Fisheries Service declared the sockeye to be endangered. In 

1992 the Snake River spring/summer chinook and fall chinook were listed as threatened 

and the coho were declared extinct. 

The Department of Interior determined that the CBP DEIS would need a supplement to 

address the anadromous fish issues raised about the September 1989 draft EIS and to 

address the ESA related issues. That supplement has been under preparation since mid1990 was completed by 1993. The concept set forth in the supplement is to modify 

operations (releases) at Grand Coulee Dam in a manner to mitigate any impacts to 

mainstream flows from the additional diversions and to enhance juvenile salmon survival. 

In March of 1994, the Bureau suspended planning for any future development pending a 

resolution of the salmon issue. 

Impacts: 

The USBR moratorium on water service contracts has delayed several needed projects by 

third parties. Two pending contracts were to use CBP water for blending with potato 

processing plant wastewater so that it could be land applied as wastewater treatment. This 

type of treatment was being mandated by the State of Washington so the plants could meet 

water quality standards and improve surface water and groundwater quality in the CBP 

area. ESA is actually in conflict with another environmental goal in this situation. One of 

the other contracts was to switch sizable tracts of turf in city parks and school playgrounds 

from a groundwater source to a surface water source. The eastern portions of CBP are 

experiencing unsustainable groundwater declines because of over appropriation for 

agricultural, municipal and industrial purposes. Much of the water service contracting 

activity in this portion of the CBP during the past 10 years has been aimed at alleviating this 

groundwater decline. 

Replacing this groundwater source is also a major objective of the expansion proposed in 

the DEIS. These problems are not yet resolved. At this point completing the EIS as been 

delayed for over 3 years because of ESA. The best we can hope for now is a total delay of 

only 4 years. The worst that can happen is that ESA will preclude any future irrigation 

development in the CBP. 

Since the beginning of the anadromous fish problems with the DEIS (early 1990 to present) 

the East District has spent over 1500 man hours plus related expenses (travel, legal, 

consultants, etc.) now exceeding $55,000. The South Columbia Basin Irrigation District 

has played an active role in this issue and probably has experienced similar costs. The 

Bureau of Reclamation has borne the cost of preparing the studies to address this problem 

in the Supplemental DEIS and their costs are much greater but not available to us. So far, 

the CBP districts have not tracked their costs related to USBR' s moratorium. 

9 
139 

It is difficult to calculate lost opportunity costs. Some of the benefits expected to derive 

fonn the planned expansion are: $42 to $48 million of additional crop value per year, 2500 

new jobs, 6000 additional population in the area, 76,0CX1 annual recreational visitor days, 

plus improving the groundwater situation. 

Amendments to ESA: 

According to the National Marine Fisheries Service's interpretation of the species and 

subspecies defmitions in ESA there are hundreds of separate subspecies of salmon in the 

northwest. This allows NMFS to blanket to the entire region with ESA enforcement by 

listing only one or a few salmon runs on specific tributaries. Sockeye and chinook are generally plentiful in the region but there are numerous separate runs in decline. ESA's 

definition of species, subspecies and distinct population groups need revisions to settle the 

"lurnpers vs. splitters" argument. 

The government should also be required to do a NEP A type balancing when considering 

ESA actions, whether for listing, critical habitat, recovery plans or consultations. The 

conflict here on the CBP between water service contracts to improve water quality or conserve groundwater vs. instream flows for salmon is a good example of the need for 

that. 

Name of Organization: 

Contact: 

Address: 

Phone: FAX: 

East Columbia Basin Irrigation District 

Richard L. Erickson 

Secretary-Manager 

55 North 8th 

P.O. BoxE 

Othello, Washington 99344 

(509) 488-9671 

(509) 488-6433 

10 
140 

Testimony of 

Joe Hunter, Executive Director 

Colorado River Energy Distributors Association 

Before the 

Committee on Resources 

U.S. House ofReprestntatives 

April l7, 1996 
141 

Mr. Chainnan, thank you for giving the Colorado River Energy Distributors Association the 

opponunity to appear today to discuss impacts of the Endangered Specie~ Act on consumers who 

are dependeni upon electricity produced at federal hydroelectric facilities. 

The Colorado River Energy Distributors Association, or CREDA, represents more than 

1 00 conrumer-owned elecl.ric systems in Arizona, Colorado, Nevada, New Mexico, Utah and 

Wyoming- systems which provide electricity to millions of consumers at cost-based, not-for-profit 

rates. Combined, CREDA members distribute more than 80% ofthe electricity generated by the 

Colorado River Storage Project (CRSP). The hydropower facilities of the CRSP consist of five 

federal dams on the Upper Colorado River and associated generators, transmission lines, etc. 

My testimony today will be limited to our experiences with the Endangered Species Act 

in the Upper Colorado River Basin; however, I would say with a high degree of confidence that 

similar experiences and impacts can be found in virtually every region of the country served by 

electricity produced at federal hydroelectric facilities. 

·Implementation of the current Endangered Species Act impacts hydropower consumers 

in a number of.significant and costly ways. As a general proposition, any re.~trictions or operational 

changes mandated for federal dams that have hydropower features will ultimately have an effect on 

the value and cost of the electricity that is produced, and consequently, on the businesses and 

individuals who use and pay for that electricity. Today, however, I would like to bring to the 

Committee's attention a couple of specific financial impacts on power consumers which are perhaps 

not as clearly or widely understood - and which relate directly to programs which fall under your 

jurisdiction. 

As you know, Mr. Chairman, under the authori7..ing statutes of the Colorado River Storage 

Project, all costs of power generation and more than 90% ofthe costs of irrigation features ofthe 

project are "reimbursed" to the government through the sale of the power. In short, the Western 

Area Power Administration, who marketS the hydropower, calculates all of the cost.~ of power 

generation, as well as the irrigation and other costs allocated to power, and setS the rate for that 

power at whatever level is necessary to cover all of those costs. It doesn't matter how much power 

is actually produced or what the costs ultimately are; in the end, enough revenue must be collected 

from ratepayers to fully reimburse the government. 

Historically, this financing mechanism has served its intended purpose: To repay the lion's 

share of the costs of the CRSP, while still providing a relatively ecooomical source: of electricity for 

growing regional economies. In recent years, however, costs have increased dramatically, while the 

hydropower resource itself has been steadily degraded. In other words, the electric cooperatives and 

municipal utilities CREDA represents have, over the pa..ott ~everal years, been on a discouraging 

spiral of paying more for a less valuable resource. 

While several factors have contributed to this spiral, there is no single cause that is as 

significant as the implementation of the Endangered Species Act. As you undoubtedly know, the 

Colorado River Basin is home lo a wide variety of endangered and threatened species, and the costs 

of the federal government's efforts to protect and recover those species find their way into 

the rates consumers pay for electricity from several di1ferent directions. 
142 

First of aU, whenever an effort is mandated to attempt to recover species which are 

dependent upon the river, the operation and impacts of the federal water facilities are among the first 

things that are examined for potential remedies. The clearest example of this is found in the ongoing 

recovery effons for the Colorado River Endangered Fishes. Virtually all water use and development 

in the Upper Colorado River Basin is contingent upon the "Recovery Implementation Program for 

the Endangered Fishes of the Upper Colorado River Basin." Begun in 1988, this program seeks to 

identify and implement recovery actions that will benefit four species of endangered fish while 

allowing the Upper Basin States to utilize their legal allocations of the Colorado River. 

Expenditures to date under this program have amounted to more than $40 million. Of that 

amount.. more than $14 million has been funded directly from power revenues. More significantly, 

it should be noted that the program thus far has forused largely on research and planning related to 

even more costly activities in the future. Current estimates call for spending somewhere between 

$60 and $112 million through the year 2003 to actually implement the recovery program. 

AJ. this point, it is unclear how these sums will be obtained; however, I think it is safe to say 

that the most popular potential souree of funding is the "so-called" cash register of power 

generation. 

As impressive as these dollar amounts might be, Mr. Chairman, it is essential fur the 

Committee to recognize that the real costs of these types of Endangered Species Act activities are 

found elsewhere. For example, the budget for the upper basin recovery program I just outlined only 

includes the costs of research, administration, and actually building or buying things. What that 

budget docs not include are the costs of reoperating dams and the resulting decreases in the value 

and amounl of hydroelectric: power that is produced. 

Not surprisingly, much of the focus of ongoing and tinure recovery dorts is to change the 

way tbe dams on the Colorado RMr are operated in order to provide specific lows at specific times 

for the endangered species. It is iroDic, but nonetheless acc:urate, to say that much of the mearch 

beiDa fiDaDced in part by power eoDSUI'IICR is geared toward ~ ways to sac:ri&e 

hydropower pneration tor the bene&t of the fish. And while those sac:rific:es may or may not be 

appropriate &om a biological or policy standpoint, it must be recognized that the resultiJia costs are 

very real and very substaDtial. 

Given the way the Colorado River and many other rivers throughout the West are manapd 

to meet water supply and otber needs, when dams arc used to manipulate flows, ·the resJit is often 

a reduction in tbe &IIIOWil or value of the hydropower that is produced. Unfortwl&tely, these 

operational c:hazlges do DOt reduce costs, ~ leaving elecvieity consumers to pay more for less 

power. CoiDpOIUJidina that COI1 is the fact that utilities have to replace the power generation and 

capacity that is sacri1ic:ed with resources that are often less efficient and more expensive. Again, 

that iDereased cost is ultimately bome by the eoasumer. 

For example, tor the past several years, Flaming Gorge Dam on the Upper Colorado River 

has been operated under a regime mandated by the Fish and Wildlife SeJVice fur the recovery of the 

3 
143 

Colorado River endangered fishes. From 1985 through 1991, dam operations were altered in order 

to conduct research fur the preparation of a Biological Opinion. The economic cost of the electricity 

not generated as a result of that research is estimated to be $5 million per year. Once the biological 

opinion was written and the dam'~ operation sel accordingly, there has been a continuing economic 

cost of foregone generation of roughly $2 million per year. It should be noted that these amounts 

reflect estimates of the value of power not produced, and do not reflect the additional incremental 

cost of replacing that power from more expen~ive sources. 

In short, they are conserv•live estimates. and any co-op or municipal utility manager who 

distributes CRSP power will teU you that the actual cost is significantly greater. 

(should also point out, Mr. Chairman, that eleven years and S45 million later, we still don't 

know with any certainty how Flaming Gorge Dam will be operated in the future. It is reasonable to 

expect, however, that future costs will be at least as great as the current ones. 

CR.SP customers face a similar problem, with greater potential impacts, at Glen Canyon 

Dam. One of the products of recent years' environmental work at Glen Canyon Darn is a biological 

opinion calling for five yean of research flows to a.o;sess the impacts of "steady flows" on the 

endangered fishes. Again using the value of lost generation, the projected economic cost of these 

research flows is about $79 million per year. If, in fact, as the Fish and Wildlife Service has 

requested, there are five years of these flows, the total economic cost is roughly $39S million. 

What these examples illustrate is the fact thal the true financial impact of the Endangered 

Species Act on the millions of consumers who depend upon hydropower generated at federal dams 

is far greater than the amounts you will find in agency budgets and appropriations bills. The value 

of hydropower is its capacity to provide electricity when il is needed. As the operatioti of these 

facilities is increuingly dictated not by water conditions or by consumers' electrical needs, but by 

research and other elForts carried out under the mandates of the Endangered Species Act, that value 

is lost. Society's need for the power, however, does not go away, and whatever we saaifice in the 

form of cleln, renewable hydropower has to be replaced - and that replacement cost.~ very real 

dollars that ultimately have to be collected in consumer's electric bills. -

4 
144 

Testimony of 

John F. Stovall, General Counsel 

Kern County Water Agency 

for the 

Association of California Water Agencies 

Sacramento, California 

Before the 

Committee on Resources 

of the 

U.S. House of Representatives 

Hearing on the Endangered Species Act 

April17, 1996 

INTRODUCTION 

On behalf of the Association of California Water Agencies' (ACWA) more than 

450 public water agencies and mutual water companies that deliver 90% of California's 

water, I would like to thank you for the opportunity to discuss matters of grave concern to 

our agencies and their constituents, the people of California. California is the endangered 

species capital of the United States. Over 100 species are currently listed as endangered 

or threatened and 162 more will be listed in the near future. This overwhelming number 

has impacted virtually every aspect of California's economy. The Endangered Species 

Act (ESA), in its current form, creates significant difficulty and expense for our districts 

as they strive to meet the water and water-related infrastructure requirements of our state. 

My name is John Stovall and I am the General Counsel of the Kern County Water 

Agency, one of the members of the Association of California Water Agencies. The Kern 

County Water Agency is one of the largest providers of water to both agricultural, and 

municipal and industrial customers of water in the state of California. By way of 

background, I am also the chairman of the Endangered Species Act Work Group of 

ACWA, the chairman of the Legal Committee of the State Water Contractors, an 

organization of local governments which contract with the state of California for water. 

and a member of the Board of Governors of the State Bar of California. 

I am testifYing today for the association because the Kern County Water Agency. 

the State Water Contractors, and the members of ACWA have found that the current 
145 

Testimony of John F. Stovall 

Association of California Water Agencies 

House Committee on Resources Hearing on the ESA 

Aprill7, 1996 

Page 2 

language of the ESA has led to significant impairment of our ability to meet the 

infrastructure needs of our constituents for water supply and flood control. We are very 

concerned that the ESA has caused costly delays and revisions in plans for construction 

of projects and imposed significant additional costs on existing projects and existing uses 

of land after decisions have been made and public funds have been invested. The true 

cost of the ESA is not the comparative pittance it costs to pay the enforcer; it is the 

regulatory burden imposed on the public by the heavy hand of the enforcer. In these 

cases, the "enforcers" are the United States Fish and Wildlife Service, the National 

Marine Fisheries Service, and their agents. 

The decision to tax, assess or charge our constituents for public infrastructure is 

not one we take lightly. We are sure you understand that the decision to exact funds from 

constituents is one of the most difficult elements of the democratic process. Before doing 

so, it has been the practice of our members to carefully consider the benefits to be derived 

from a project, and compare those benefits to the costs involved. The impact of the ESA 

is exceptionally onerous to us when we have performed this analysis in the past, and 

concluded the project is worthwhile for public investment, only to learn that requirements 

imposed by administrative edict under the ESA significantly raise the cost. 

A further difficulty arises currently because it is virtually impossible to accurately 

assess the cost of future ESA compliance even if an agreement is reached with the 

enforcement agencies. While a negotiated resolution may be struck regarding existing 

species on the list, many of our members believe that they are always susceptible to new 

demands based on species listed after an investment is made. In some instances, species 

have even been pitted against each other with measures required to protect species that 

harm other species. 

The following testimony illustrates to you the impacts on the cost of our projects, 

and some of the activities of our constituents. We will first address the impacts on a little 

known flood control project which has been in existence for decades. We then turn to the 

impact on water supply and costs utilizing the State Water Project, a project which was 

constructed in large part before the ESA was passed, most of it before any of the current 

species of concern were listed. Next, we will examine other examples of water district 

impacts and impacts on constituents throughout the state where the cost of projects has 

been exacerbated by ESA requirements. Finally, we suggest to you some potential 

solutions in an attempt to break the seeming impasse which has developed on the issue of 

reform. 

We continue to believe that it is possible to craft Endangered Species Act reform 

which continues to provide protection to species while protecting the ability of State and 

local governments to serve the needs of their citizens. We also believe that an ESA 
146 

Testimony of John F. Stovall 

Association of California Water Agencies 

House Committee on Resources Hearing on the ESA 

Aprill7, 1996 

Page 3 

which provides for cooperative and reasonable solutions would ultimately better serve 

our environment by avoiding the hostile backlash to all environmental concerns that we 

have observed in the western states. Our challenge is to break through the rhetoric of 

confrontation and achieve a solution which meets the needs of people and the needs of 

our environment. 

II 

COST/BENEFIT, FLOOD CONTROL & THE ESA 

One of the elements of public infrastructure most sensitive to cost/benefit analysis 

is flood control. Other committees of this Congress, of which many of you may be 

members, are familiar with the agonizing public policy decisions which must be made in 

the flood control arena. As we seek to spend the public's money wisely, we must balance 

the benefits of such projects with the costs. A problem has arisen regarding the ESA as 

applied to these projects. It is not possible now to accurately assess the costs of flood 

control projects since new costs may be imposed by ESA enforcement agencies many 

yean, even decades, after the projects are put in place. The example I will discuss here is 

my agency's Kern River Intertie project, built many years ago with the Corps of 

Engineers. 

Kern IJver Intertie 

The Kern River Intertie (lntertie) was constructed in the 1970s in Kern County to 

allow the flood waters of the Kern River to be partially channeled into the California 

Aqueduct to prevent flooding of farmland downstream of the Intertie. The essential 

elements of the Intertie facility are a gate structure to control flood flows into the 

California Aqueduct and a settling basin upstream of the gate to prevent undue sediment 

from being washed into the aqueduct. The project was accomplished with the assistance 

of the Corps of Engineers and for many years was routinely maintained under contract 

with local water districts pursuant to our contract with the Corps of Engineers, and in 

accordance with federal regulations. Those federal regulations required, among other 

things, removal of vegetation showing on levees and in the settling basin. In 1993, the 

maintenance of this flood control project became anything but routine. 

Unknown to the Kern County Water Agency (the Agency) or to the water districts 

that had contracted with us for maintenance, Fish & Wildlife Service agents with 

assistance from California Fish & Game were eyeing the Intertie property. Following 

routine maintenance of the property, including discing for vegetation, agents appeared at 

our headquarters asking for permission to inspect the property. We later learned that they 
147 

Testimony of John F. Stovall 

Association of California Water Agencies 

House Committee on Resources Hearing on the ESA 

Aprill7, 1996 

Page 4 

had already been on the property to investigate. Having nothing to hide, and not thinking 

we had anything to fear, we allowed them to do so. It was not the end of the story. 

The Agency then received letters form an Assistant U.S. Attorney claiming the 

Agency had violated the ESA and threatening prosecution. The \gency was forced to 

spend tens of thousands of dollars in defense of allegations that a tractor driver hired by a 

local water district had run over Tipton Kangaroo Rats, a species listed under the ESA. 

Demands were made for ISO acres of mitigation land and hundreds of thousands of 

dollars in penalties. Believing the charges were unjustified and the demands unfair, we 

chose to investigate ourselves and discovered numerous problems with the case alleged 

by the government. We found that eve if rats had been run over (itself subject to some 

question), they were probably of the "short-nosed" variety, an unlisted species. In any 

event, the tractor driver was certainly unaware of any damage to rats as were the districts 

performing the maintenance. The Agency was unaware that the maintenance was even 

underway at the time. Yet, the Agency was still singled out as a defendant. 

When presented with results of the Agency's investigation, the Fish & Wildlife 

Service agreed to reevaluate its position. To date, the United States h$-not filed an 

action against the Agency. We remain uncertain over how maintenance of the Intertie 

and concerns about the Tipton Kangaroo Rats will be resolved. 

The additional costs imposed on this project could still be drastic, and we are 

taking some risk in exposing this incident to you. In our view, however, it is critical that 

you be aware of how this act is being unfairly enforced. This project was routinely 

maintained for more than a decade in conjunction with the Corps of Engineers' 

requirements. Now, because of the ESA, this project has been threatened with hundreds 

of thousands of dollars in costs. We have incurred almost $100,000 in legal defense 

costs, and we are still threatened with the extortion of 5 acres of land for every acre on 

which enforcement agents assert rat habitat exists. Had we know of these problems 

before the project was built, it would never have been built. As it is, we have no choice 

but to pass the costs imposed on to the farmers downstream who thought they were being 

protected. 
148 

Testimony of John F. Stovall 

Association of California Water Agencies 

House Commitlee on Resources Hearing on the ESA 

April 17, 1996 

Page 5 

Ill 

WATER SUPPLY IMPACTS AND THE STATE WATER PROJECT 

REDUCED WATER SUPPLY !INCREASED COSTS 

As a clear-cut e"ample of the water supply costs imposed on California water 

agencies by the ESA, I would like to discuss with you the impact on deliveries and costs 

of the State Water Project (SWP). The State Water Project in California is a system of 

water conservation and transportation facilities which provides water for more than 20 

million Californians, most served by the Metropolitan Water District of Southern 

California, and hundreds of thousands of acres of the most productive farmland in the 

world. It extends from Oroville in the north where the excess waters of the Feather River 

are stored for use, to the reservoirs of Southern California where water is stored for use 

by the 20 million residents of that area. Between the two, the Kern County Water 

Agency (the Agency) accepts water from the California Aqueduct to serve hundreds of 

thousands of acres of productive farmland and residents of Kern County from Taft on the 

west to Tehachapi on the east. Most of our municipal water is provided to the Greater 

Bakersfield area, a community in excess of 300,000 people. Twenty-nine other public 

agencies have contracted for a water supply from the SWP. 

Construction of the S WP was begun during the early 1960s, having been planned 

for many years prior. After approval by the state legislature and the voters of California. 

the construction of its conservation facilities and hundreds of miles of aqueduct began. 

Deliveries to the Kern County Water Agency started in 1968- years before the 

Endangered Species Act was passed. 

One of the prime concerns of the developers of the project was whether 

·agriculture could afford to pay the anticipated costs. The project without agricultural 

participation would not have been prudent from a cost/benefit standpoint. Even today, 

the cost of water from the SWP is critical to the viability of agriculture in the central 

valley of California. Cost is also important to the people of Southern California. The 

ESA has significantly contributed to elevating the cost of water from this key project. 

Let me describe for you the impacts which the SWP experiences under the 

negotiated Bay-Delta Accord (Accord), and compare those to the demands which were 

made by wildlife agencies prior. This is important because, while we support the Accord. 

we are very concerned about potential demands for water when the Accord terminates. 

The SWP shares a number of facilities including certain sections of the California 

Aqueduct, and the "south of the Delta" storage facility , known as the San Luis Reservoir. 

with the Central Valley Project. Together these projects account for approximately 30% 
149 

Testimony of John F. Stovall 

Association of California Water Agencies 

House Committee on Resources Hearing on the ESA 

April 17, 1996 

Page 6 

of the states water supply. They coordinate their operations under a coordinated 

operations agreement (COA). A precise determination of the split of the losses imposed 

by the ESA is difficult because of the variables involved, but a rough estimate of a 50/50 

split suffices. 

The 1994 Accord modifies a prior state water quality standard to provide tor ESA 

implementation. It provides 400,000 acre-feet of additional water for the Bay-Delta in 

average years; one million acre-feet in drought years. The measures contained in the 

agreement are intended to provide sufficient habitat protection for currently listed 

endangered and threatened species and to create conditions in the Bay-Delta that avoid 

the need for any additional listings under the ESA for three years. Estimating the dollar 

cost of this lost water is both difficult and inadequate in that it cannot measure the human 

costs to the people affected. Applying the rough value estimate of $100 to $200 per acrefoot in a dry year, the cost is approximately $100 to $200 million if that replacement 

water can be purchased at all. If it cannot be purchased from other sources, as may be the 

case in critically dry years, the costs would be even greater. 

These losses are less, however, than those demanded by the wildlife agencies at 

the outset. During the negotiations their demands were for 800,000 acre-feet in normal 

years, and two million acre-feet in critically dry years. 

Under the 1994 Accord, if federal agencies determine additional water is 

necessary to protect endangered species not listed, the federal government has the 

responsibility for acquiring water through voluntary purchases financed with federal 

funds. The accord provides temporary relief from the punitive effects of the ESA, but the 

act still needs to be reformed to prevent the serious impacts described below from 

occurring in the future. It must be emphasized that the relief afforded to California water 

agencies and their constituents dependent on the SWP will end in 1997, and we anticipate 

that wildlife agencies will be demanding additional water at our expense. 

In the two years prior to the signing of the Accord in December 1994, when the 

winter-run Chinook salmon and the Delta smelt were listed under the ESA, the effect of 

protective measures was to reduce the amount of water available for export from the 

Delta to state and federal water customers. During these two years, the state and tederal 

water projects' Delta pumping operations were conditioned on "take" provisions under 

ESA, which limited the number oflisted species that could be lost to the pumps. The 

water losses for both projects totaled one-million acre-feet in 1993 and 1.3 million acrefeet in 1994. Again, it is difficult to estimate the value of such losses. but using the 

values derived in the recent drought market, the value of the water lost can be estimated 

at $100 to $200 per acre-foot had the water been stored for dry years. 
150 

Testimony of John F. Stovall 

Association of California Water Agencies 

House Committee on Resources Hearing on the ESA 

Aprill7, 1996 

Page 7 

As an ironic anecdote, on February 23, 1993, just six hours after Governor Pete 

Wilson declared that California's prolonged drought had ended, the SWP pumps were 

shut down for I 0 days to allegedly protect winter run salmon smolts, although the 

evidence that the smolts were "winter run," rather than an unprotected variety, was 

virtually non-existent. 

I have spoken here about the SWP because that is the project of which I am most 

familiar. However, the impacts on the CVP and its contractors have been equally 

significant. 

These impacts are sever, but by no means the only impacts of the ESA in 

California. The following are some additional examples of regulatory costs imposed on 

existing projects in California as a result of the Endangered Species Act. 

IV 

URBAN AND AGRICULTURAL IMPACTS OF ESA RESTRICTIONS 

Eastern Municipal Water District (Riverside County) 

About 144,000 acres, or more than 400/o, of Eastern's service area is now 

designated sensitive habitat to protect various plant and animal species listed under the 

ESA. The recent listing of the California orcutt grass and the expected listing of the San 

Jacinto saltbrush will designate even more acres. Twice in recent years, the district had 

to re-route pipelines to accommodate listed plant species discovered just before or during 

construction. In one case, the plant in question was a grass detectable only in May and 

June. Months of negotiations with the U.S. Fish and Wildlife Service and other agencies 

delayed construction and resulted in more than $600,000 in additional project costs. 

Kern County Water Agency 

Facing dramatic cuts in surface water supplies during the recent drought, KCWA 

sought to drill ground water wells to save crops dependent on imported water. While 

curying out required wildlife surveys and a biological assessment, the district found 

burrows potentially belonging to endangered Tipton kangaroo rats. A special study was 

required to determine whether the burrows were used by Tipton rats or Hermani kangaroo 

rats, which are not endangered. After securing necessary permits and a qualified biologist 

to trap kangaroo rats, the district was delayed because trapping cannot take place during a 

waxing or full moon. Rains further delayed the trapping, and more time was lost when 
151 

Testimony of John F. Stovall 

Association of California Water Agencies 

House Committee on Resources Hearing on the ESA 

April 17, 1996 

Page 8 

the district could not get an appointment with the U.S. Fish and Wildlife Service. In the 

end, the district lost three months in drilling the wells, spent $24,000 on the biological 

assessment and $3,700 in mitigation fees. 

City of Santa Barbara 

Plans to enlarge _and reinforce Santa Barbara's Gibraltar Darn had to be canceled 

because of potential effects on habitat of the least Bell's vireo, an endangered bird. The 

cancellation cost the city some $3 million in construction expenses, lost revenues and 

costly alternative water sources. 

Joshua Basin Water District (San Bernardino County) 

Plans to extend water service lines to about 400 households, primarily retired 

people, were derailed by requirements to protect habitat of the endangered desert tortoise. 

Construction was delayed, and the district spent more than $1 .5 million as the federal 

Bureau of Land Management and state Department offish and Game wrangled over who 

should own and manage 3 88 acres set aside by the district for the tortoise. 

In the meantime, the 400 households had to have their water supplies trucked in. 

Extensive delays and prohibitive costs of complying with the ESA left frustrated district 

officials with little hope of resolving the matter and may prompt them to abandon the 

project. 

Desert Water Agency (Riverside County) 

A pipeline construction project ran into delays and additional costs due to snags 

involving the habitats of three endangered species. The pipeline had to be re-routed to 

avoid Coachella Valley fringed-toed lizard habitat, adding $100,000 to the cost of the 

project. Then construction was ceased for several months during the mating season of the 

peninsular big hom sheep, and design modifications were made to accommodate the 

sheep. The agency again had to delay the project to undertake a study of the Coachella 

Valley milkvetch plant, which, it turned out, was not present in the project area. In the 

meantime, all-terrain vehicles and motorcycles continued to impact lizard habitat in the 

same area the agency was forced to avoid with its pipeline. 
Testimony of John F. Stovall 

Association of California Water Agencies 

House Committee on Resources Hearing on the ESA 

April 17, 1996 

Page9 

Kern County Agriculture 

152 

The ESA has also had significant adverse effects on agriculture in the San Joaquin 

Valley. Kern County has been particularly hard hit. 

In a case that attracted national attention and sparked cries for ESA reform. 

bamboo farmer Taung ¥ing-Lin faced criminal prosecution last year after discing private 

agricultural land inhabited by endangered kangaroo rats. State and federal wildlife 

agency officials searched Lin's property in February 1994 and confiscated his tractor and 

disc. Lin said he was not aware there were endangered species on the 723 acres he 

purchased in 1991. The case was ultimately dropped for a nominal settlement after 

numerous hours of attorney time had been expended. 

Recently, another case involving attempted farming of land in the San Joaquin 

Valley resulted in payments of tens of thousands of dollars by Valley Communities, Inc. 

In this very recent case, we are unaware of the precise details. 

v 

REASONABLENESS AS A REFORM 

"Reasonableness" can be defined as taking into account all aspects of a situation in 

reaching a balanced decision. It also demands good science, public review and due 

process. The requirement of reasonable action is spread throughout the law, but it is 

strangely lacking in certain unbalanced provisions of the Endangered Species Act. For 

example, reasonableness demands consideration of the effects on projects or uses which 

wee in existence before a species was listed, yet the act treats all projects and uses alike 

whether begun decades ago or tomorrow. Reasonableness demands consideration of 

whether equivalent results can be obtained with protection plans which are less damaging 

to other species or humans, and yet the act allows administrators to simply demand what 

they want. Reasonableness demands that we should at least know what the impacts of 

our actions are on humans, and yet the act does not even require us to examine and record ' I what those impacts are, much less balance them . Where agreement has been reached 

and investments have been made, reasonableness suggests that federal agencies should 

not be allowed to demand further land or water, yet those now entering agreements with 

the federal government are never certain that more penance will not be demanded as new 

species are listed. 

1 While consideration is technically required at some points. wildlife agencies have assened that all 

economic impacts occur at the listing stage when take prohibitions apply and that subsequent impacts are 

minor. 
153 

Testimony of John F. Stovall 

Association of California Water Agencies 

House Committee on Resources Hearing on the ESA 

Aprill7, 1996 

Page 10 

ACWA has developed a brief but succinct list of pints which we consider critical 

to successful ESA reform. These points are as follows: 

I. Water rights should be respected. 

2. Ecosystem conservation approaches should be encouraged rather than 

a single species approach (protecting against demands for newly listed 

species). 

3. The unfunded mandates imposed on state and local governments 

should be resolved by federal funding of costs imposed. 

4. Economic analyses should be done at all stages so that we will know 

what the true costs ofESA regulations are. 

5. The regulatory process should be re-engineered to provide 

administrative streamlining and good science, complete with peer 

review, to avoid delay and red-tape. 

6. Exempt reasonable operation and maintenance of existing public 

facilities and other important existing uses, such as agriculture. 

We believe that these changes can be achieved with no real loss of protection for 

species. In fact, cooperative partnerships between the federal government and state and 

local agencies are possible if some of the fear of future unanticipated loss is removed. 

We look forward to working with you and all those interested in reasonable reform to 

achieve an Endangered Species Act which not only improves our environment, but allows 

local governments to provide for the needs of their constituents without undue 

interference by the federal government. 
154 

ASSOCIATION OF CALIFORNIA WATER AGENCIES 

ENDANGERED SPECIES ACT POSITION POINTS 

The Endangered Species Act (ESA), passed by Congress in 1973, provides for the 

conservation of endangered and threatened species and their habitats. 

At the time of its passage, few suspected that more than a thousand species would end up 

being listed under the Act. Moreover, only a few listed species have recovered to the 

point of being delisted. ·Recovery plans required under the Act are not developed 

promptly. Listed species often require significant changes in local and regional economic 

systems which may take years to effect. These facts and the fact that many additional 

species may be listed in the next few years, indicate that the Act is having a far greater 

impact than originally contemplated, and is specifically not working well to protect listed 

species. 

The ESA is currently up for reauthorization in the I 04th Congress. The following 

position points are items that ACW A believes should be addressed during the 

reauthorization process. The following position points are listed in priority order. 

WATER RIGHTS SHOULD BE RESPECTED 

• The ESA should clearly state that it does not supersede compacts and decisions of the 

U.S. Supreme Court in allocating water among states. 

• The ESA should clearly state that where water is needed to protect, recover, or 

maintain listed species, federal resource agencies should follow state water law to 

obtain it. 

• Section 7 consultations on federal water projects should not result in termination of 

water contracts of existing contract holders. 

• First priority for recovery plans and critical habitat designations should be for plans 

that use land owned by the federal government. 

ECOSYSTEMS APPROACH NEEDED 

• Multi-species habitat conservation planning should be encouraged, eliminating the 

need for species-by-species listing and mitigation requirements for individual species 

within conservation areas. 

• Where habitat conservation plans are approved by the appropriate federal agency, the 

approval shall constitute an incidental take permit for all covered species listed or 

unlisted. On a subsequent listing of an unlisted species, the only action which the 

appropriate federal agency may take is to ensure compliance with the plan. 
155 

UNFUNDED MANDATES 

• The ESA should appropriate federal funds to assist the development of cooperative 

management agreements with state and local governments and local organizations. 

• Where Section 10 permitting or Section 7 consultation interferes with existing uses of 

property or water rights or require dedication ofland, there should be federal cost 

sharing with local governments or local property owners affected. 

ECONOMIC ANALYSIS 

• The economic impacts, including compliance costs, of listing a species should be 

determined by requiring the U.S. Fish and Wildlife Service and National Marine 

Fisheries Service or other appropriate federal agencies to develop an economic impact 

report covering the entire geographic area economically affected by the proposed 

listing, the recovery plan and the critical habitat decisions. 

GOOD SCIENCE AND ADMINISTRATIVE STREAMLINING 

• Scientific peer review by a nationally recognized scientific organization, such as the 

National Academy of Sciences, is needed at every phase of the listing process. 

• The recovery process should be better defined, with clear goals, and recovery plans 

should be adopted and implemented in a timely manner. When the goals in the 

recovery plan are met, the species should be delisted. 

• Local impacted communities need to be brought into the process earlier through better 

use of public notice of potential listings and critical habitat designations. Notices 

should cover the entire area which will potentially be economically impacted by the 

listing, not just the immediate area where the species resides. 

• Decisions by resources agencies on what constitutes a take under Section 9 and 

decisions on applications for incidental-take permits under Section 10, must be based 

on sound, supportable, peer-reviewed scientific evidence. 

• The same rules and guidelines should apply to listings and delistings. 

• The ESA should provide equal access to the courts for persons who support and 

persons who oppose a listing. 

• The ESA's definitions of subspecies or geographic range, and the ESA's listing 

criteria should avoid: I) the listing of plants or animals where there is not clear 

scientific evidence of their subspecies status, and 2) the listing of species whose 

numbers are limited in one area, but flourish in another geographic area. 

• The ESA should codify administrative hearing and appeal procedures for listing 

decisions, recovery plan decisions, designations of critical habitat, decisions of what 

constitutes a "take" of a listed species, and decisions on applications for incidentaltake permits. 
156 

GOOD SCIENCE AND ADMINISTRATIVE STREAMLINING - Continued 

• To avoid duplication, the ESA should offer and encourage delegation to states able to 

meet established Federal guidelines. Appropriate Federal agencies should be directed 

to establish a program to delegate authority to such states and to issue guidelines by 

which those states could assume authority. o To establish an Endangered Species Act 

Advisory Board to provide independent peer review of a listing or de listing of a 

species. 

ESA Work Group- 4/15/96 
LEGEND 

Federal (USBR) 

State (Calif.) 

- - Federal/State (joint use) 

~ 

~ KERN COUh'TY 

WATERAGENCY 

5118195 

24-936 96-6 

157 

California 

Water Projects 
Acre-Feet 

900,000 

800,000 

700,000 

600,000 

500,000 

400,000 

300,000 

200,000 

100,000 

0 

Lost Pumping Oppo

Due to the Endangered 

1992 1993 
2.0 

1.8 

1.6 

'$ 1.4 

LL 

~ 1.2 

1.0 

c 

.Q 0.8 

~ 0.6 

0.4 

0.2 

0 

Water Supply I

Worst-Case* Scenarios vs. B

Drought Year 

Combined impacts of biological opinions for Winter Run Salmon, 

plus 12/15193 EPA standards. Doe& not include impacts from "take lim
160 

Winter Run Chinook Salmon 

In 1994 the "take limit" was 905 smolts. 

One fish caught at fish screens "computes" to 30 fish counted against the take limit. 

1 Oo/o of Winter Run smolts were hatchery raised and tagged. 

During 1993, 97 smolts were actually caught at fish screens. 

Of these 97 smolts, 20 (21 o/o) had clipped adipose fins (hatchery raised). 

Of the 20, 19 had tags showing they were fall-run; one was missing its tag. 

This one was assumed to be a winter run (even though it had a clipped fin) and 

counted against the take limit. 

The other 77 untagged smolts were all assumed to be winter run and counted 

against the take limit. 

W"anter Run Chinook Salmon 01JCC1rlryncluu tsluzwyrscluz 

Federal Threatcncd. Caliromia Endangered. 

C1CJI KERN COUNTI 

.IIIII WATER AGENCY 

4/17/95 
161 

Winter Run Chinook Salmon 

Ocean fisheries "take" 25% of adult population. 

Recreational fishing "takes" 3% of adult population. 

Delta export projects had "take limit" of one percent of juvenile population 

imposed, or 0.02% of the adult population. 

Wildlife agencies use a complex "formula" to compute "take." 

Their "formula" allegedly accounts for striped bass feeding in Clifton Court 

forebay and other factors. 

The water projects are held responsible for fish eating fish! 

In 1994, of smolts charged as "takes." none were proven to be Winter Run 

Salmon. 

Winter Run Chinook Salmon Oncorhynchll$ uhawytscha 

Federal Threalened. California Endangered. 

~ KERN COUNTY 

IIIII WATER AGENCY 

4/17/95 
162 

Delta Smelt 

Populations are estimated using midwater trawl net surveys. 

In 1994 a pilot study compared conventional trawl net efficiency with Kodiak net 

efficiency. 

Conventional Trawl Gear Kodiak Trawl Gear 

Average Average Average Average 

Date Catch/Tow Catch/1 000 m3 Catch/Tow Catch/1000 m3 

09/22/94 2.6 0.2 415 S4.1 

09/29/94 0.6 0.06 131 20.1 

10/20/94 0.0 0.0 8.4 1.4 

Wildlife agencies concluded that Kodiak trawl gear was not suitable for population 

surveys because all past data is based on conventional trawl gear. 

Delta Smell flypomesus transpacijicu.s 

Federal Threatened. 

Jllll" KERN COUNTY 

..ltltl WATER AGENCY 

4/17/95 
163 

1991 Emergency Ground Water Program 

KCWA faced an emergency water supply situation. 

A plan was devised to extract "banked" water by constructing 19 new wells and 

using other existing wells. 

A CDFG biologist determined that the 1991 emergency program posed minimal 

risk to T & E species. 

KCWA spent $28,000 for wildlife surveys and such, and NOT ONE THREATENED 

OR ENDANGERED SPECIES WAS FOUND. 

KCWA obtained an approved Biological Assessment & Mitigation Plan for 

construction of 19 new wells. 

In spite of this, 

Wildlife agencies' ESA requirements and bureaucracy resulted in a threemonth delay in construction of new wells. 

USF&WS refused to allow use of existing wells, even though an approved 

plan had already been obtained for construction of the 19 new wells. 

KCWA and DWR were prevented from recovering 100,000 AF, at a cost to KCWA 

of$3 million. 

~ KERN COUNTY 

.11111 WATER AGENCY 

4/17195 
164 

STATEMENT 

BEFORE THE COMMITTEE ON RESOURCES 

U.S. HOUSE OF REPRESENTATIVES 

REGARDING 

REAUTHORIZATION OF THE ENDANGERED SPECIES ACT 

Presented in Washington, D.C. 

on 

April17, 1996 

Presented by Supervisor Sam Sharp 

Imperial County, California 

on behalf of the 

Southern California Association of Governments (SCAG) 

Good morning, Mr. Chairman and honorable members of Congress. I am 

Supervisor Sam Sharp of Imperial County in Southern California. I am here on 

behalf of the Southern California Association of Governments (SCAG), which is 

the Metropolitan Planning Organization for a six-county region and the largest 

Council of Governments in the nation. I am a member of SCAG's 70-member 

Regional Council that is composed of County Supervisors, Mayors, and City 

Council Members from the counties of Los Angeles, Orange, Riverside, 

Ventura, San Bernardino, and Imperial. I am a member of the Energy and 

Environment Committee and I also represent SCAG as an appointee to the 

Governor's Committee on Biodiversity and the Desert Advisory Council. 

The Energy and Environment Committee has devoted a great deal of time this 

past year reviewing Endangered Species Act (ESA) Reauthorization issues. 

Fifteen million residents in SCAG's region will be especially affected by the 

manner in which the ESA is implemented. Much work needs to be done to 

improve the framework and implementation of the current law. In the existing 

ESA legislation, financing mechanisms are inadequate in providing the 

necessary funding for local governments to plan, acquire, manage, and monitor 

natural habitat areas. 
165 

-2-

Funding requirements have fallen upon local jurisdictions and land owners. 

Federal and State agencies have held public hearings outside of the 

jurisdictions where new and potentially-threatened and endangered species are 

affected. A process is needed for local governments to provide input regarding 

endangered and threatened species within their boundaries. There is a need 

for establishing consistent, clear guidelines and standards for habitat 

conservation and recovery plan requirements so that abuse by administrative 

discretion is prevented. It is also necessary to establish a process by which 

local governments are able to incorporate decisions on habitat conservation 

into the general planning process for land use, regional development, housing 

and public facilities. 

The costs associated with species protection and land use policies must be 

considered, especially with regard to Southern California's diverse ecosystem. 

California is blessed with a rich biodiversity, encompassing 11 biogeographic 

regions, 396 distinct habitat types and more animal and plant species than any 

other State (821 vertebrate species and 8,000 plant species). Many of these 

are in Southern California. Under the Federal ESA, as of 1993, 64 animals and 

44 plants found in California were listed as threatened or endangered. 

Seventy-three animals and 213 plants were listed as threatened or endangered 

under the California ESA or California Native Plant Protection Act of 1977. 

Most of these listings were due to the result of habitat losses. 

We believe that a comprehensive multi-species habitat preservation approach 

could bring about measurable economic benefits to the Southern California 

Region. This type of program could protect the region's e<:Qnomy against 

development disruptions that would otherwise occur due to planning and 

funding disputes. Disruptions could result in lower job growth and resident 

incomes. We believe in the systematic evaluation and restoration of natural 

habitat for the benefit of healthy ecosystems. rather than a "species-by-species" 

approach. A multi-species habitat approach would encourage holistic 

management of listed species, such as the recent attempt to identify and 

manage a habitat for the coastal California gnatcatcher and other sensitive 

species residing in the same area. This concept - multi-species habitat 

conservation plans for sensitive habitat types - is a more systematic, 

anticipatory and proactive approach to coordinated resource management. 

allowing reasonable, compatible development and full protection of the species 

of concern, minimizing future conflict with the need for regional development 

and providing certainty in planning to developers and conservationists alike. 
166 

- 3 -

There are four types of financial costs associated with species protection and 

land-use policies: 

1) costs for information gathering and analysis about species and 

habitats or ecosystems, 

2) costs for the acquisition of critical habitats or ecosystems, 

3) costs for restoring habitats or ecosystems and rebuilding populations 

of threatened species, and 

4) costs for monitoring, evaluating, and taking remedial efforts, when 

necessary. 

None of these four types of costs are funded under the current Endangered 

Species Act. The Federal ESA and most State Acts push the costs to local 

governments, private land owners, and project proponents. Local funding 

programs are often time-consuming and often difficult to establish - particularly 

where a number of local agencies are involved - regionwide. If the 

implementation of the ESA is in the national interest, then the funding should 

be shared equally - nationwide. 

Riverside County passed a $300 million bond issue to acquire land for the 

Stephens' Kangaroo Rat. The County had anticipated State and Federal 

funding to match the more than $120 million raised locally through 

development impact fees and project mitigation measures. Without the 

matching funds, the County's effort to form a joint powers agency to implement 

a preservation plan for the kangaroo rat was hampered. 

In Ventura County, as a direct result of compliance with Federal ESA 

mandates, the costs of a local municipal flood control project was increased by 

thousands of "hard dollars" spent and many more "soft dollars" lost in time 

delays. In Imperial County, with unemployment ranging from 22.5 to 33.7 

percent, there are not enough county dollars to fund basic services - let alone 

to comply with ESA requirements. State and local governments simply cannot 

afford the regulatory mandates imposed upon them by the currently-enforced 

Federal ESA. 
167 

-4-

Many private land owners are reluctant to willingly and voluntarily participate in 

conservation management practices that would encourage the proliferation of 

threatened or endangered species on their land. This reluctance stems from 

the concern that the presence of a listed species would limit the options for their 

land or diminish the value of their property. A family in Riverside County had 

farmed a piece of ground for over 1 00 years. They had practiced established 

agricultural recommendations and farming standards for crop rotation and 

fallowing. An incursion of kangaroo rats in the fallowed area precluded their 

ability to continue to farm on a significant portion of their land. 

We believe that the ESA should be amended to provide explicit Congressional 

endorsement of agreements that will protect land owners who are willing to 

maintain or enhance suitable habitat property for threatened or endangered 

species. To be attractive to the land owner, the agreement must be voluntary, 

exempt the land owner from future land use restrictions that might otherwise be 

incurred by a species moving into the habitat, and allow the land owner 

appropriate control over the management of the land. If land owners could 

have some assurance that a "take of habitat" would not lead to prosecution 

under the Endangered Species Act, they would be more willing to participate in 

activities to preserve habitat. 

Without secure rights to private property, land owners who wish to derive 

economic value from their land will have very little, if any, incentive to engage in 

land-use practices that will be beneficial to threatened and endangered species 

since currently such species represent an economic liability that devalues 

property. The result is that the minority of Americans with endangered species 

on their land are forced to bear all the costs of providing habitat. Just as 

compensation is paid for the public good such as for highways, public parks, 

military bases, and others, the U.S. Fish and Wildlife Service should also 

compensate private property owners when the protection of threatened or 

endangered species devalues their property. 

Approximately 65 percent of the land in Southern California is publicly owned 

and administered by agencies of local, State, and Federal governments, 

including the Bureau of Land Management, the U.S. Forest Service, the 

Department of Defense, the National Park Service, State Lands Commission, 

and State 'Parks and Recreation. All governments should maximize the use of 

public lands for the conservation of threatened and endangered species. The 
168 

- 5-

use of public lands should be the first priority for the purposes of meeting the 

habitat conservation needs of the Endangered Species Act. 

Current legislative efforts will not preclude the need for developing a funding 

framework. The creation of a Federal funding framewor1< is the most critical 

element: 1) in re-establishing the balance of biodiversity, 2) for reconciling 

concerns regarding economic development and the protection of individual 

property rights, and 3) for removing the burden of funding and implementation 

from local governments. Not only is the funding critical, but streamlining the 

implementation is essential to local governments. Delays and added project 

costs caused by compliance with Federal ESA mandates waste scarce local 

government dollars. High costs to developers also negatively affect local 

governments in their efforts toward economic development and additional 

revenue generation. 

The benefits of reducing regulatory burdens are dear: The empowerment. 

enhancement and creativity of the regional planning process in Southern 

California can enhance the survival of endangered species; increasing 

competitiveness for economic growth; and honoring both the need to conserve 

our nation's biodiversity and to appreciate the freedoms associated with private 

land ownership. Reauthorization of the federal Endangered Species Act must 

reduce administrative, economic, and regulatOl)' burdens on local governments 

and provide funding to conserve threatened and endangered species. 

Attachment 

ESA Reauthorization Policies 

[Adopted by the Regional Council, September, 1995) 
169 

Endangered Species Act (ESA) Reauthorization Policies 

In 1995, the Southern California Association of Governments adopted policies to ensure 

that Congress reauthorizes the Endangered Species Act to endorse the following 

principles: 

Habitat-Based Conservation Planning. Provide for comprehensive 

habitat-based conservation plans whereby landowners, local governments, and 

others can b.l ensured: 1) that land-use activities will not be disrupted, and 2) that 

additional conservation actions will not be required regardless of subsequent 

species listings. 

Listing!Oelisting with Biological Data. Require that proposals for listing 

or subsequent delisting of species as endangered or threatened be supported by 

specific types of biological data meeting significant scientific standards, taking into 

consideration local conditions and whether the recovery of a species is possible or 

feasible. 

Delist on Pre-Determined Criteria. Promptly delist endangered or 

threatened species on pre-determined criteria or if recovery is found to be 

impossible based on significant standards/biological data. 

A Clear Definition of Species. Provide a definition of "species" which 

ensures that: 1) species are taxonomically distinct, and 2) protection is not afforded 

to individual population segments of species whose overall population is not 

considered at-risk. 

A Modified Definition of ''Take of Habitat". Modify the definition of "take 

of habitat"; 1) to apply to affirmative attempts to injure, harm or kill a listed species 

directly, and 2) to exclude destruction or adverse modifications to wildlife habitat as 

determined by a qualified biologist, according to pre-determined criteria, to be 

unsuitable for occupation by a listed species regardless of season. 

Categorical Exemptions for Routine Maintenance. Provide 

categorical exemptions for routine maintenance and emergency repair of public 

facilities, infrastructure, and agri-farming practices that have enhanced endangered 

or threatened species. 

Project Exemptions. Provide an exemption for projects crucial to public health 

and safety. 

Process and Review Plans. Require processing and review of permit 

applications, habitat conservation plans, and Section 7 consultations to be 
170 

Endangered Species Ad Reauthorization Policies 

Southern California Association of Governments 

Page2 

subject to specific dates of completion and deemed approved if not completed as 

required. 

Evaluation of Economic and Social Impacts. In addition to biological 

data, require an analysis of the economic impacts and social impacts of a species 

listing based on established aiteria detailing the total costs and funding. 

Local Government Funding. Require federal and state agencies mandating 

habitat plans should be required to fully fund local governments for the costs of said 

plans prior to development and implementation. 

Consultation with Affected Jurisdictions. Require consultation with 

affected local jurisdidions at least 60 days prior to a notice of a proposed listing 

appearing in the Fec!eral Reaister. 

Public Hearings in Affected Areas. No adion under the ESA shall be 

implemented without full public hearings within the jurisdidional area and 

opportunity for full participation/review by the local government affeded. 

No Acquisition of Private Prooertv. No acquisition of private property shall 

occur for endangered species habitats, due to the implementation of State and 

Federal Endangered Species Ads, without just compensation, taking into 

consideration the value immediately prior to notice of proposed acquisition or 

restridion. Payment shall be made at the time of acquisition or restridion or transfer 

of deed. 

Consolidate Agency Efforts. Consolidate the efforts of all federal and state 

agencies deal.ing with endangered species to eliminate duplication, so that private 

properties are not subject to double jeopardy. 

Maximize Use of Public Lands. All governments should maximize use of 

public lands for conservation of threatened and endangered species. The use of 

public lands should be the first priority for the purposes of meeting the habitat and 

conservation needs of the ESA 

Adeauate Funding for Local Government-Required Plans. Any 

local government independently mandating an endangered species plan not 

required by federal or state government or any other governmental agency, shall 

have the responsibility for identifying adequate funding for the plan. 
171 

Endangered Species Ad 

Southern California Association of Governments 

Page3 

Clear Guidelines and Standards. Clear guidelines and standards for the 

type and extent of biological and other information required for habitat conservation 

plans, recovery plans, and the like, must be established to avoid unwarranted 

pressure from mandating agency staff. There should be no "moving targets"; aiteria 

should be established up front in the procass to ensure no abuse of administrative 

disaetion OCCU'S. 

Congressional Funding. corvess shall provide adequate Mding for the 

i~dtheESA. 
172 

United States Department of the Interior 

Honorable Don Young 

OFFICE OF THE SECRETARY 

Washington, D.C. 20240 

Chairman, Committee on Resources 

House of Representatives 

Washington, D.C. 20515 

Dear Mr. Chairman: 

9661 I - HeN 

Thank you for your February 5, 1996, letter to Secretary Babbitt regarding costs 

associated with implementing the Endangered Species Act. We appreciate the 

opportunity to respond to your inquiry. 

Last October, the Fish and Wildlife Service published the 1994 Report to Congress 

on its Endangered and Threatened Species Recovery Program. In conjunciion with 

releasing that report, the Service developed summary figures for implementing the 

program. For Fiscal Year 1995, Service appropriations to carry out programs for the 

recovery of listed species were $39.7 million. Using an estimate of 250 million 

people for the population of the United States, the recovery budget was about 16 

cents per person that year. 

Appropriations for the Service's Recovery Program for Fiscal Years 1989-95 were 

$142,254,000. If this figure is divided by 7 (the number of years in the time period) 

and then subsequently divided by the population number, the resulting figure 

indicates that the Service received about 8 cents per person per year to fund its 

recovery program. These calculations were based solely upon appropriations to the 

Service. We are enclosing copies of pages from the documents used to develop these 

figures. 

You also asked about the amounts that Interior Department agencies have spent on 

implementation, enforcement, compliance or any other Act activities required or 

mandated for the last 5 years. The figures you requested for Fiscal Years 1991, 1992, 

and 1993 can be found in the enclosed Federal and State Endangered Species 

Expenditures Reports, copies of which were provided to Congress under section 18 of 

the Endangered Species Act of 1973, as amended in 1988 (Public Law 100-478). The 
173 

Honorable Don Young 2 

Service is completing the Fiscal Year 1994 Expenditures Report and has initiated the 

data solicitation for Fiscal Year 1995. When these reports are printed, we will 

provide the Resources Committee with copies. 

Based on the published Federal and State Endangered Species Expenditure Reports 

for Fiscal Years 1989-1993, which identify expenditures that are reasonably 

identifiable for the conservation of threatened and endangered species by Federal 

and State agencies, about $861,784,000 was expended during the 5-year period. This 

means that approximately 69 cents was spent per person annually for the conservation 

of listed species. 

Regarding your request for the Department's projected funding needs for 

implementing the Act in Fiscal Year 1997, that information is contained in the Fish 

and Wildlife Service's proposed FY 1997 Budget Justification, a copy of which has 

been provided to your Committee. 

Again, thank you for your interest. If you have further questions, please let us know. 

Enclosures 

Sincerely, 

G~~1~~/rf- Assistant Secretary for Fish 

and Wildlife and Parks 
Typo of .... '"' 1917 ... 

..... _ ..... ,_ ...... A- ......... ......... £a.ctetl l!a8ded 

lt'OLOCIC.U I DVICU 

-- c ...... 16.5'8 16.746 ...... 18,13

......... 

._ 3,191 3J)7! 3.622 3.25

.,_ ..... 6.Q31 3,193 2.97

Jta.MI{IM'NIID ~Aalnia '95) 718 

'" ... .,.

- 5.1N 

""' ..... 7,511

"'-"- 3,92Jl ..,.. ..,.. ..,.

-·--· llo.A14] (12,011) (11.2181 (li.MO

rr-.._.._. ,,....,, (28,13<) (29.7641 )30,672

~W~Ma~:c:--....1/ c ...... IWI 16,813 1&.261 19,5<

ln.t ............... /TediAM. • 0 0 

-- 0 • 0 

-~ 0 0 0 

....... _ 0 • 0 

......,.w ...... ....._,. S.CIO 5.<156 5.206 5 ...

---w- 0 • 0 

ATTIA 0 0 0 

-~ c- 5..51' 3,191 

""" 5.85

--- "-- ...... ...... .. _ .,1

JDUCD AMJ WIIDlln c ...... 

...... a,.-.. _ c- 102.130 99,271 111A6! 117)m 

a,.- .. .1111 ...... ....., """

- 33Jl5t 32.171 31.413 

"""

w ..... c:n..t..~~ c- 

~.--- c..- 17.990 .. ..., 11.322 ,. ... 

-LI IDJ>09 ..... 9977 11,74

......,. .. 2.1» ,.... 2.117 2.15

._..,_ .. UIS 7.381 ..,. ...,

__ , ..... c- ..... ..,.., .. ... '-"

----- .,_ 

- ....... ..,....,.......

.......,.,_1001_ 

- c- u.rn ....... ,..... ,..

_ ... ,_,a,.- 7$10 7;9{ 7.117 .....

...... , ........ _,_ 13$8 13.117 13.o>2 1 ....

-.-·- .,.._ 3 .... ""' Ul5 3 ... 

.__ __ ,__ c- ..... 5.339 ..... 6,51

..... __ c..- ..... 028 5.301 5.>1

_ ... _ 3.011 3JI62 3.236 

""

...... WIIIIIII~ 1 .... 1,666 ..... 2.53

-- .,_ JUII ...... - .....

P8gtl1 of 2 
T)poof .... , ... ,,.., ,,. 

!!!!: 

--· A-lloo ........ ._... IEuded t-tad 

IESEAROi.AND DEVELOPMENT 

Fbh and Wl.ldllh Raean:h Or. Orti.t: Cumno 33,130 ,...,. .,.., ., ..

"""""""'"-""' 10,214 9,726 1~936 12,1

WUdllfo- ..... 8,981 12,123 1...

""""""-"" 10,771 10,984 1l,S77 13..0

......,....,.,.... ......... ..... ..... 4,8ll ...

-............. 1,992 2,201 2,362 

~· 

Tedvlkal Dm:iopcnent 5,535 5,291 5,174 5,6

i;; unt• ..... U6S 4.150 5,67

S.bk*J. a...ntr....t Dwwlor-t c ....... ....., 46,1f2: S4,3S7 ....

GENUAlADMINlSTilA.nON 

c.ntnJ. Of6ot Adminlllration Cumno 7,128 10,397 ll,l04 n.m 

JtorskwllOf6ot.A.cl&nirUtntkln ~• 12,1<7 10,157 1,.,. 13,3

5avlc:ewWk Ada\lrUtnltw: Support Cumno ,. .... 17,M7 

"'·"' ll,l7

"""""""' ........ 0 0 0 

TnU\tncand l!ducaticn 0 0 0 

..................... CWftnl 3,504 ,..

SU.OW,C~~a 

"'"' ,..,., ...... .. ,

SUI TO'TAL RE$0JlCii MCMT. INACTED Cumno 211,m ,..~, 323,631 3oU..

DtaHSfEBS &t:IDSlf.ttl EWEMIAI S 

ANIMAL DAMAGE CONTROL (Dept. ol AJ.) Cumno 

""" Nrt Trantfcn for Unngmcy Fw Swpptaaion Cumno 1Ji

and Rood Pn!Ycndon 

1989 Dire Em~ SupplancnGl Cumno 

1990 Unantici~t~ Nttd.t • Hurr. Hugo Cumno 

Net 00 SpW Emapncy Fund Truwltn Muhi·yw-(0/4) 

1992 DIRS EMERGENCY SUPPI.D{ENTAL c ...... 

,.UIIIo&l-11 

1994 FoNt Plan Supplancnttl c ...... 

1994 Tr&rlllw from N!lS (adDV.rUtradve-Net) c...- 

==mtal · f\ooOt/F.atthqual&e Cumno 

RESOUII.CI MAHACINI!NT Cv.ND TOTAl 

"'"" ~" 32:.1,631 30,1

Page 2 ol2 
=!!nr u:•u ~ 1 I I 

I I I'!!IU ! 

i 1 ~ ·u•u··i 

I I I !1'!!111 

I I I lll!!!fl 

1

1 1 n•nns 

f I 5 §ll!!(fl 

I !JI!Uf(l 

I II 

! ! i 

176 

{ i i I ; i i; 

iII I l I l l "' 

nnnu 1 

uu~su 1 

nnnn 1 

UU!!U I 

nnnu 1 

IU~!U! 'I 

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I I I I J J U · J J UJ J J ') 
177 

FEDERAL AND STATE 

ENDANGERED SPECIES 

EXPENDITURES 

FISCAL YEAR 1993 

Compiled by 

U.S. Fish & Wildlife Service 

January 1995 
178 

a:-tMs.-.ur 

Scdioa 18 of the Eodulgcrcd Spccica Acl (Acl) of 1973 requira the Secretary of the 

IDt.criar (wwma tbrousb the Fllh IIICl W"aldlife SerW:e) to -ua~~y report certaiD apeaditurca for the COIIICrYIIioa of tbrealCDed IIICl cadaDpred specia. T1lia report ptaCAIS the 

reported CllpCIIditura for FIICAI Year 1993. 

Bad!pouad: Oldy dlolc ~ that arc ~ jclretifiehlc for a lilccd apeeie& arc to be 

reported. AD Fedaal ljiiiDCiea IIICl dlole Stlla receiwiD& Scdioa 6 srut-ia-aicl f1llllk 

puriuul to the Acl arc albd to report. 'l1ae 6nt report far FIICAI Year 1989 reported 

eapeiidirua• tata~iai- lllaa S43 miDioa far die~ of347 (63%) of 554 

ipCCica lilled • tllralaed IIICl Cllllallprcd • of Sepcaabcr 30, 1989. 'l1ae 1990 report 

!abalatccl CllpCIIIIitwa totaliaa - dwa $102 miDioa for 477 (81 ") of the 591 listed 

apeciea. 'l1ae 1991 CllpCIIIIitwa totalecl alaallll $177 miDioa for S'IO (89%) of the 639 

tJarealaed lllclllllllaapcMI specie~. ud r:llpCIIdit1lra tolaliaa $291.$10,910 wue reported 

for 679 (93%) of the 7J8 t.brulcacd ud CDdupred 8pCcica iD 1992.. SiDcc oaly a few 

foreip ipCCica arc reccMaa ezpeDditurea from U.S. pa~~~~~eatal aaeDCiea, tbae aaaual 

reporU arc ratric:ted to a disaaaiOD COIICCtUia lilccd U.S. apccicl. 

I!JFe• f.c••• tolaliaa sm. ogo,no (S42.329,wl for lad acquililioll-Table 3, s1!10, 761,210 

Ill adler ClpCDIIilw .... Table 1) arc reported bere for 750 (93%) of the 809 lhrealcDecllllcl 

Cllllupred 8pCcica lilled iD the Uaited SCala. · &pm Fan• arc idaiUiiecl by lpecica ud 

reported teparardy for the F'llh ud Wildlife Senice (Sc:na), die Statca, ud iD IIIRP1e 

for Ill adler~ FedaallpiiCica. 

'l1ae 5erYice ud 18 adler Fedaal lpDCia idallified r:llpCIIdit1lra for the CODMtVatiOD of 

iDdMdual tlarealcBcd .... eraduprcd lpCCieL Two otllcr ..--rapoaclcd that their 

c:apeaclihlrea wae IIGl reuc.ably ;.tcnrifiehlc to apeciea. Rapc.ca from aD Fedual 

lp8Cic& arc iadudcd ia Appcadil L nc IDedia toea1 ~ ezpcaditure -

approlimately S13,1n) (w.ailllaa of S18.52111iilioa) pel' lpCcic:a reccMDg at least $100. Taa 

1pcc:ica (U %) -=ci.for 49.6 penal of Ill ClpCIIdilwa for wbicb amOUDis wen 

reported. 

A sood laitl! e«ort - aade to cle¥elop ~ apeaditurea for Ibis report. 

HOWC¥a, die w-.uoa prcaaMed wu c1oa IIG( rdlecl the toea1 aaboDal e«ort toward 

tlarealcBcd ud Clld.uprcd apccica ~ ud -aiDua to pracDl u iDcompletc 

fuDdial pican. A lipificaat portiOD of tluuteacd aacl Clld.uprcd apecica c:oaaerva1ioa 

ldMtic:a iadudea law eaforcemc:at, ~ recovay coordiDatioa aad otlacr actioDI 

that arc IIGl easily or ..-ably jclretified to lpCCieL Ac:alllllliaa proczdurea by all 

apDCica for mOll lUff aalariea, operatioaJ.. maiatCDA~~CC aad otlacr Apport services are aot 

recordecl to apecica. Also IIGl reported bere are die Cllei!IM elforu of die private ICClor, 

wuy JI'OIIPI, iDdMduak, corponlioas, aad odlen baYe coatribulcd a coasiclcrable amowu 

of ,__ aad wllll!leer time toWards listed apecica. 

Tbis report tabulates apcDditures that are M times tbe FY 1989 apeuditurcs ($43 m.illioa), more tlwl double tbe $102 aaillioa ofl990, a oae-dlird iDcreaac ovcr the $177 millioo 

a11101111t iD 1991, ud a reductioD of :ZO perceDl from 1992 (S291.S aaillioa). The F'ash aacl 

W"ddlife ScMce estimates Wt tbe bulk of tbcse clwl&c& are from bcUcr repottiag by the 

State aad Federal ~ with particular izu:reased emphasis on habitat acquilitioos for 

listed speees iD the past several yean. 
179 

FEDERAL AND STATE 

ENDANGERED SPECIES 

EXPENDITURES 

FISCAL YEAR 1992 

Compiled by 

U.S. Fish & Wildlife Service 

June 1993 
Purpolc: 

Bacqrolmd: 

Raul IS: 

180 

Scaicm 18 of lhe ~ Specia AJ:t (AJ:t) of 1973 requiles die Semwy of die 

llltcrior (workiD& lhrougb lhe Fish IIIII Wilcllife Service) 10 lllllllllly repon cenain 

expenditures for lhe COIIICIVIIiOD of lbrealeDed 11111 . Cllllaqered specia. Thil repon 

praenu die reponed expenditures for Filc:al Y car 1992. 

Ouly !bose expeodinua dial me reucmably idcatifiable for a species me 10 be 

reponed. All Fedcrll qeacia llld dl01e Slalea receiviJII Sec:tio11 6 Jl'llll·ill-Ul tauds 

putSUaiiiiO die AJ:t me ubd 10 repon. The tint repon for Filcal Year 1989reponed 

expeoditures IOia1il1a more 111m $43 millioo for die ~ of 347 (63S) of !!S4 

specia lis!cd as lbrealeDed llld Clldmlpred a of SepfaDber 30,1989. 1be 1990 repon 

tabulaled apcaditures IOialiDa - thaD $102 mi11ioD for 477 (81 S) of die !191 specia 

lis!cd as ofSeplembc: 30, 1990. The 1991 expellllitures lOWed a1IIIOII Sl77millioD for 

S70 (891) of die 639lbrealeDed llld elldiD&end specia. SiDI:e oaly a few fomJD 

spceies me receivi2la apeaditures fnlm u.s. pcrmoea&ll aam:ica. dlae -w 

repona me larply rauicted 10 a dilcuuiOD COIICa1liiJ& Lillecl u.s. specia. 

~ IOiaUDc $291,510,91011'C l'llpOned bae for 679 (93S) of die m 

lbrealeDed aud elldqeled specie~ (Table 1). ~ are idallified by specia 

aud reponed sepm!Ciy for die Filii aud W"lldlile Service (Service), die Staia, aud ill 

aurepse for all oilier reponiD& Feden1 lpllda. 

1be Service aud IS oilier Feden1 alcacia idealifted apeaditma for die c:oa.mriOD 

of iDdividual thralaled aud eDdaDpred species. AIIOibcr duee apacia raponded 

dial dlcir apcaditures - 1101 reuoaably ideadftlble 10 lpiCiel. RapoaiCI fJom all 

Fedcrll qeacia are illduded ill AppeDdil I. n. lllldiaD apadilllre • ._ $16,000 

(lll&limuiD of S73S79millloa) per lpeciel rec:eiYiq lllall $100. Five speeia (0. 7 S) 

KICOUIIIed for SO.Spertelll of all apalllllwa for wbic:ll- were n:poned (Table 

2). The lllllllbcr of specla rec:eiYiDa ball of ada yar'a reponed apeadiua bas 

clcdilllld ill ada of die 4 reporliq yan. 

A aood flidl eft'orl - apiD mate 10 develop spccia-by-tpeeia apeadiluna for IIIia 

~q~~~r~. However, die il1formllioa prellllled llill doll 1101 reflec:t die IOial lllliaaal 

eft'oriiOWUd tbralaled aud ClllllqeNd speciel -.ervlliaa aud -mae. 10 pn!MIII 

111 iDr:oalplele fuDdiD& Piaw'e- A lipificiDI ponioo of llualeDed aud Clllllqered 

speeia camervlllioD IICI!vilicl iDd1ldel law earvr-t, COJIIUllllioa, recovery 

cocmliiiiUoa aud oilier a&:Uolll IIIII are 1101 ealily or t-"ly idallifted 10 speeia. 

Acc:oullliq procedures by all aaCDCiel for - aaft ularia, opcntal, maimm'D"" 

aud oilier lllpPOit services II'C 1101 reconled 10 specia. Abo 1101 reponed bae are die 

exlelllive efforiS of tbc priva&e MCtor; .lllllll'J poups, iDdividuab. corponlioal, aud 

Olben bave COIIIributed a CODSiderable IDIOIIDl of I'CIOW'Ciel aud voiUIIIAier lime -.nil 

lis!cd species. 

Thil repon labu1ales ICYCII lima tbc expelldilurea ($43 millioa) as die repon for FY 

1989. aearty uiple tbc SJ02 millioa of 1990. aud a 6S peroem u.:s- over tbc 1991 

amoum. 1be Fish aud WUdlife Service estimUa dial die bulk of dlae iDI:IaJa me 

ftom bener reponiDa by die SIIIC llld Federal a,CDCia, wid! paniciWir illcraled 

empbuis oo blbiw acquisilioas for lisled specie~ ill die put 2 yean. 
181 

FEDERAL AND STATE 

ENDANGERED SPECIES 

EXPENDITURES 

FISCAL YEAR 1991 

Compiled by 

U.S. Fish & Wildlife Service 

July 1992 
182 

Executive Summary 

Purpose: Section 18 of the Endangered Species Act (Act) of 1973 requires the Secretary of the Interior (working through the Fish and 

Wildlife Service) to annually report certain expenditures for 

the conservation of threatened and endangered species. This 

report presents these expenditures for Fiscal Year 1991 . 

Background: Only those expenditures that are reasonably identifiable for 

a species are to be reported . All Federal agencies and those 

States receiving Section 6 grant-in-aid funds pursuant to the 

Act are to report . The first report for Fiscal Year 1g99 reported expenditures totaling more than $43 million for the 

conservation of 347 (63~) of 554 species listed as threatened 

and endangered as of September 30, 1989. The next report tabulated expenditures totaling more than $102 million for 477 (81~) of the 591 species listed as of September 30, 1990. Since only a few foreign species are receiving expenditures fro. U.S . governmental agencies, these annual reports are 

largely restricted to a discussion concerning listed U.S. 

species. 

Results: Expenditures totaling al.ast $177 •illion are reported here for 

570 (891) of the 639 threatened ·and endangered species (Table 1). Expenditures are identified by species and reported sepa- rately for the Fish and Wildlife Service (Service), the States, 

and in aggregate for all other reporting Federal agencies. 

The Service and 10 other Federal agencies identified expenditures for the conservation of individual threatened and endangered species. Another five agencies responded that their 

expenditures were not reasonably identifiable to species. Responses fro. all Federal agencies are included in Appendix 1. The -.dian expenditure was $12,200 (•axi.u• of $24 .651 •illion) 

per species receiving at least $100. Seven species (1.1 ~) 

accounted for 51.5 percent of all expenditures for which 

a.aunts were reported (Table Z) . The nu.oer of species receiving half of each year's reported expenditures has declined in 

each of the three reporting years. 

A good faith effort was made to develop species by species expenditures for this report. However, the information pre- sented still does not reflect the total National effort toward 

threatened and endangered species conservation and continues to 

present an Incomplete funding picture. A significant portion of threatened and endangered species conservation activities 

includes law enforcement, consultation, recovery coordination 

and other actions that are not easily or reasonably identified 

to species. Accounting procedures by all agencies for .ast 
183 

FEDERAL AND STATE 

ENDANGERED SPECIES 

EXPENDITURES 

FISCAL YEAR 1990 

Compiled by 

U.S. Fish & Wildlife Service 

January 1991 
184 

Executive Swaaary 

Purpose: Section 18 of the Endangered Species Act ("Act) of 1973 requires the Secretary of the Interior (working through the Fish and 

Wildlife Service) to annually report certain expenditures for 

the conservation of threatened and endangered species. This 

report presents these expenditures for Fiscal Year 19go. 

Background: Only those expenditures that are reasonably identifiable for 

a species are to be reported. All Federal agencies and those 

States receiving Section 6 grant-in-aid funds pursuant to the 

Act are to report. The first.!eport for Fiscal Year 1989 reported expenditures totaling more than $43 million for the conservation 

of 347 of 554 species listed as threatened and endangered as of 

September 30, 1989. Since only a few foreign species are 

receiving expenditures from U.S. governmental agencies, these 

reports are largely restricted to a discussion concerning listed 

U.S. species. 

Results: Expendftures totaling .are than $102 •illion are reported here 

for 477 of the 591 threatened and endangered species (Table 1). Expenditures are identified by species and reported separately for the Fish and Wildlife Service (Service), the States, and in 

aggregate for all other reporting Federal agencies. 

The Service and 12 other Federal agencies identified expenditures for the conservation of individual threatened and endangered species. Another five agencies responded that their expenditures 

were not reasonably identifiable to species. Responses from all 

reporting Federal agencies are included in Appendix 1. Expenditures were reported for approximately 80 percent of all United 

States listed species with a median expenditure of $13,150 (range of $100 to $9.7 million) per species. Half of all expenditures 

were made on approximately 2.1 percent of those 477 species for 

which expenditures were reported (Table Z). This result is 

slightly lower than the 3 percent of the species reported for FY 

1989 that received half of those species with reported expenditures. 

A good faith effort was made to develop species by species expenditures for this report. However, the information presented still does not reflect the total National effort toward threatened 

and endangered species conservation and continues to present an 

incomplete funding picture. A significant portion of threatened 

and endangered species conservation activities includes law 

enforcement, consultation, recovery coordination and other actions 

that are not easily or reasonably identified by species. Accounting procedures by all agencies for most staff salaries, 

operations, maintenance and other support services are not recorded by species. Also not reported here are the extensive 

efforts of the private sector; many groups, individuals, corpor-
185 

FEDERAL AND STATE 

ENDANGERED SPECIES 

EXPENDITURES 

FISCAL YEAR 1989 

Compiled by 

U.S. Fish & Wildlife Service 

January 1990 
186 

Summary 

Purpose: Section 18 of the Endangered Species Act 

(Act) of 1973 requires annual reporting 

of certain expenditures for the conservation of threatened and endangered species. 

This report presents these expenditures 

for Fiscal Year 1989. 

Background: Section 18 of the Act was amended on 

October 7, 1988, by Public Law 100-470 to 

require the Secretary of the Interior 

(working through the Fish and Wildlife 

Service) to report to the Congress annually 

on certain expenditures for the conservation of threatened and endangered species. 

Only those expenditures that are reasonably 

identifiable for a species are to be 

reported. All Federal agencies and those 

States receiving Section 6 grant-in-aid 

funds pursuant to the Act (States} are 

required to report. No such reporting 

requirements were included in the Act 

prior to this amendment. 

Results: Expenditures totaling more than $43M are 

reported here for the conservation of 34 7 

threatened and endangered species (Table 1 ). 

Expenditures are identified by species 

and reported separately for the Service 

and in aggregate for all other Federal 

agencies reporting and the States. The 

International Association of Fish and 

Wildlife Agencies assisted the Service by 

compiling the data on total States expenditures by species. 
187 

DEPARTMENT OF THE ARMY U.S. A.tmv Corp• of Eru;~~eers 

WASHINGTON, D.C. 20314·1000 

REPLY TO 

ATTENTI ON OF: 

2. 2 APR 1936 

Policy Review and Analysis Division 

Legislative Initiatives Branch 

Honorable Don Young 

Chairman 

Committee on Resources 

House of Representatives 

Washington, D.C. 20515 

Dear Mr. Chairman: 

I am responding to questions posed by several members of 

your Committee during the April 17, 1996, hearing on the 

implementation and administration of the Endangered Species Act 

(the Act). The questions involved u.s. Army Corps of Engineers 

appropriated expenditures for Pacific salmon in the Columbia and 

Snake Rivers in Washington, Oregon and Idaho. Specifically, have 

Corps and Bonneville Power Administration (BPA) expenditures been 

"double reported" to your Committee and what percent and amounts 

of the Corps annual expenditures are repaid to the Treasury by 

power users through the BPA? 

We have consulted with BPA staff and I can report that there are no "double reported" figures provided to your Committee. BPA 

did not include any Corps expenditures or requests for 

appropriations in their report to the Committee. With regard to 

Corps annual expendit.ures repaid to the Treasury by power users, 

allocations vary on a project-by-project basis. On average, 

however, the repayment by power users for Corps projects on the 

Columbia and Snake Rivers is 80 percent. 

In dollar terms, we estimate the following repayments were made: Fiscal Year 1992: $10.4 million; Fiscal Year 1993: $17.2 

million; Fiscal Year 1994: $32.6 million; Fiscal Year 1995: $64 

million . Given our projections for salmon expenditures in Fiscal 

Years 1996 and 1997, we expect the repayment to be approximately 

$72 million and $84 million, respectively. 

It is important to note that previous reports to your 

Committee and the Corps annual response to the Department of the 

Interior, have not reflected these repayments. This is due to our need to communicate budgets and expenditures necessary to 

comply with the Act as a function of our mission execution. 
188 

2 

I appreciate the opportunity to provide this information and 

would be glad to respond to any additional inquiries. 

Copies Furnished: 

Sincerely, 

fk: . ene MaJor General, .s. Army 

Director of Civil Works 

Members of the House Committee on Resources 

Assistant Secretary of the Army (Civil Works) 
189 

DEPARTMENT OF THE ARMY U.S. Arrny Corps of Enginftts 

WASHINGTON, O.C. 20314·1000 

REPLY TO 

ATTENTION OF• 

19 APR 1996 

Policy Review and Analysis Division 

Legislative Initiatives Branch 

Honorable Helen Chenoweth 

House of Representatives Washington, D.C. 20515 

Dear Mrs. Chenoweth: 

During the April 17, 1996, Committee on Resources hearing on the implementation and administration of the Endangered Species 

Act, you suggested that the U.S. Army Corps of Engineers Civil 

Works appropriations for Fiscal Year 1995 was 192 million 

dollars. I noted my concern regarding the accuracy of that 

figure and indicated an interest in providing you with current 

budgetary information. 

I have enclosed a chart reflecting the Corps Civil Works 

appropriations from Fiscal Year 1967 through Fiscal Year 1997 

projections. I can report that the Corps Civil Works 

appropriations for Fiscal Year 1995 was slightly more than 

3.3 billion dollars. 

I appreciate the opportunity to provide this information and 

would be glad to respond to any additional inquiries. 

Enclosure 

Copy Furnished: 

Sincerely, 

..fj;j;,' stanle tf.t:: G. Gene M~~neral, .s. Army 

Director of civil Works 

Assistant Secretary of the Army (Civil Works) 

24-936 96-7 
190 
191 
FUNDING OF THE EN

ARE WE ADEQUATE

A Study of ESA 

and the Budget of the 

as it Relates to Protecting En

Prepared by the C

Maj

Apr
TABLE OF CONTENTS 

SUBJECT PAGE NUM

1. H.R. 2275 ·AUTHORIZATION OF "FUNDING FOR ESA 1 

2. CLAIMS BY BABBITT ON ESA FUNDING 2 

3. OTHER CLAIMS ON ESA FUNDING 3 

4. FISH AND WILDLIFE SERVICE ANNUAL 

REPORT TO CONGRESS 3 

5. LIST OF AGENCIES REPORTING ESA EXPENDITIJRES 4 

6. 1993 RANKING OF SPECIES BY EXPENDITURES 5 

7. GAO REPORT ON SALMON EXPENDITIJRES 5 

8. DEPARTMENT OF INTERIOR TOTAL BUDGET 7 

9. FISH AND WILDLIFE SERVICE TOTAL BUDGET 7 

10. SPECIAL BUDGET ITEMS 8 

11. ECOLOGICAL SERVICES 9 

12. REFUGES 10 

13. HABITAT PROTECTION AND RESTORATION 11 

14. FISH PROTECTION PROGRAMS 12 

15. GENERAL ADMINISTRATIVE COSTS 13 

16. MISCELLANEOUS FUNDS FOR WILDLIFE 13 

17. COSTS OF RECOVERY 16 

ATTACHMENTS: CHART SHOWING FEDERAL AND STATE E

THREATENED SPECIES, 1991-1997 

ORGANIZATIONAL CHART OF THE FISH A

LIST OF FEDERAL STATUTES AUTHORIZIN

TO PROTECT WILDLIFE 

18 
FUNDING OF THE ENDANGERED SPE

ARE WE ADEQUATELY FUNDING m

Prepared by the Committee on Resources Maj

Although authorization for funding of the Endangered Species Act expired in 

appropriate funds each year for programs carried out under the authority of the Act. 

reported H R. . 2275, The Endangered Species Conservation and Management Act of 

increases the authorized levels of funding by $110 million over the 1995 appropriatio

$51 million. According to the Congressional Budget Office, H.R. 2275 "in the agge

Between $190 million (for fiscal year 1996) and $265 million (for 2001), for a total 

These authorizations are in addition to any grants authorized by the ESA from the C

Fund or any amounts authorized under section 802 (costs sharing)." 

CLAIMS ABOUT UNDERFUNDING T

Getting accurate information on ESA related expenditures has become increas

illustrate the difficulty of getting an honest portrayal of ESA related spending. 

According to Secretary Babbitt, ESA only cost each American 16 cents per y

"But finally, more than any of our environmental laws, the Act 

singled out for elimination-- one that made Yellowstone complete-- is 

Act. Never mind that this Act is working, having saved 99 percent of 

that it effectively protects hundreds of plants and animals, from grizzly 

greenback cutthroat trout; never mind that it js doing so while costing 

Bruce Babbitt, Secretary of the Interior from "Our Covena

Creation" Interior on the Web. December 16, 199S, bttp:/lwww.us
Georae Frampton explains how this was computed: 

•For Flst:tll Year J99S, Service (Fish and Wildlife Service) app

J1TOI'DU for the recovery of listed species were $39. 7 million. Using 

people for the poptlialiolf of the United Statu, the recow:ry bridget w

that )IIQI'. • Letter ,._ Georp T. Fnapto., Jr., Alliltaat Secre

Parlll, datell April I, 19M to Cllalrau Doll Y001o Co••lttee o

Many cavironmentlliltl tend to downplay the amount of spending for ESA 

dated March, 1996, Leplalive TIIICb, distributed by the Doris Day Animal League 

the £S..4 is less than It COlts to build 2.4 mllu of urban iltlerstate highway. • Althou

provide information 011 the IIIIOUDt that cost, the Federal Highway Administration pr

mile of a lix lllle wban intaltate highway is $41.6 millioa per mile while the typic

is $9.29 milli011 per mile. This calc:ulates to $98.18 million. 

Michael Bean of the Eavironmentll Defense Fuud is fond of comparina ESA 

Wllhin&fon, D.C. · 

"The core lnldget of the U.S. Fish and Wildlift Service's enda

llllflioll. , about .qual to wltal rulde111s of the mt111'0p0/ilan W ashillg

011 plzm dellw:ry ft-jrilt 011e -.JM chain. • EDF FACT SHEET, "

Facts vs. Myths": 011 the Worldwide Web. 

Even the Coapeaioaally mandated publication on ESA Expenditures is not 

the it's numbers 11e below actull expenditures because they do not reflect administr

aliD&Ie lpiiCicl. However, the DUmbcn provided by the report differ si&nificantly f

eavironmcatalaroupL 

' 2 
The following total ESA spending was derived from the Federal and State Di

Threatened species for 1989 through 1993, Fish and Wildlife Service Annual Reoort 

478. 

1989 ---$43 million 

1990 ---$102 million 

1991 ---$177 million 

1992 ---$291.5 million 

1993 ---$233 million 

Why has there been such an effort to mislead the American public about the e

the United States in programs to protect and conserve wildlife? 

ANNUAL REPORT TO CONGRESS ON ESA E

In 1988, Congress enacted Section 18 of the Endangered Species Act of 1973 

section requires an annual report to be compiled and published by the U.S. Fish and 

identifiable for endangered species in each fiscal year by all federal agencies and tho

the Act. The last report was published for fiscal 1993. However, all agencies have t

scheduled for release in July of 1996. 

The law only requires the reporting of those amounts which are "reasonably id

limited to spending for listed species in the United States and does not include spend

The reporting is on a species by species basis. According to the report, "the informa

national effort toward threatened and endangered species conservation and continues 

significant portion of threatened and endangered species conservation activities includ

coordination and other actions that are not easily or reasonablv identified to species. 

most staff salaries, operations, maintenance and other support services are not recorde

extensive efforts of the private sector; many groups, individuals, corporations, and oth

amount of resources and volunteer time towards listed species." (Emphasis added) 

3 
In 1993, 20 Federal agencies reported spending appropriat

Department of Agriculture 

Animal and Plant Health Inspection Service 

Forest Service 

Soil Conservation Service 

Department of Commerce 

National Oceanic and Space Administration 

Department of Defense 

Office of the Under Secretary 

Anny Corps of Engineers 

Department of Energy 

Bonneville Power Administration 

Department of the Interior 

Bureau of Indian Affairs 

Bureau of Land Management 

Bureau of Mines 

Bureau of Reclamation 

National Park Service 

Department of Transportation 

Federal Aviation Administration 

Federal Highway Administration 

Department of the Treasury 

Cu.<rtoms Service 

Environmental Protection Agency 

Federal Energy Regulatory Commission 

Nuclear Regulatory Commission 

Smithsonian Institution 

Tennessee Valley Authority 

4 
The tables included show spending by species and rank the species in order o

1993 Rank Species Status 

I Salmon, Snake River spring/summer Chinook T 

2 Owl, northern spotted T 

3 Tortoise, Dessert T 

4 Salmon, Snake River spring/summer Chinook T 

5 Salmon, sockeye E 

6 Woodpecker, red-cockaded E 

7 Eagle, bald E,T 

8 Bear, Grizzly or brown T 

9 Crane Whooping E 

10 Wolf, Gray E,T 

E=Endangered T=Threatened 

The General Accounting Office in its Report "Endangered Species - Potential Econom

River Salmon" GAO!RCED -93041 , Feb. 1993, further highlights the enormous exp

species -- salmon. 

"Since 1981, federal agencies and regional organizations in the Pacific Northw

and spending over $1.3 billion (in 1991) dollars to maintain and improve salmon run

continuing decline of certain stocks of wild salmon, especially those that spawn far u

has reached critically low levels." The Snake River sockeye salmon was listed as en

River fall chinook and spring/summer chinook were listed as threatened in April, 199

preliminary estimates of the value of goods and services foregone - a measure of dire

and comprehensive study completed to date of the likely economic costs of some pot

$2 million to $211 million annually (in 1990 dollars)." No studies address how eff

prooosed to date mjght be in increasing the number of threatened and endangered ad

added) 

5 
However, to get an idea how much the annual expenditure reports understate 

a thorough analysis of the agency budgets that benefit endangered species. The lead 

Species Act is the Fish and Wildlife Service within the Department of Interior. The 

than S7 Billion in appropriations for the 1997 fiscal year. The Fish and Wildlife Se

funding for the Fish and Wildlife Service benefits wildlife and plants, which include

6 
DEPARTMENT OF INTERIOR B

1996- $6.8 BILLION: 1997 Budget Reque

The Land and Water Conservation Fund -

1996- $36,900,000 (11,283 Acres acquired for ESA out of 38,396 total ac

1997 Request - $36,900,000 

DEPARTMENT OF INTERIOR: FISH AND WILDLI

TOTAL FUNDING 1996- $1,189,631,000: 1997 BUDGE

The Fish and Wildlife Service manages 92 million acres of land including 

System, 35 waterfowl production areas and 50 coordination areas. Operates 72 N

Centers and utilizes a network of law enforcement agents and inspectors. 

FISH AND WILDLIFE SERVICE RESOURCE MANAGEMENT - Include

Fisheries. and General Administration: 

1995 

$511,039,000 $

7 
Special Requests for 1997: 

I. $11,150,000 for implementation of President's Northwest Forest Plan. 

ecosystems and to promote recovery of listed species from an ecosystem perspective

for the President's Forest Plan -$79.2 million in 1997 (FY '96- total $55.3 million). 

the Woods" program. 

2. Everglades Funding Summary- The seven National Parks and National W

provide protection for 56 federally listed threatened and endangered species and 30 c

mlllioa with $3,300,000 identified for endangered species alone. $1,365,000 for ha

appropriated to FWS. In FY 96, 55.8 mlllioa. 

8 
ECOLOGICAL SERVICES - ENDANGERED SPECIES: 

Pre1isting 1 -

Listing2 -

Consultations -

Recovery' & •-

TOTALS 

1995 

$4,442,000 

$7,999,000 

$18,297,000 

S39. 709.000 

$70,447,000 

1

$3,80

$2,00

$16,0

$36.5

$58,3

1 This account is now known as the Candidate Conservation Program and is to i

species. 

2Funds for listing have been reduced due to the moratorium on listings. The Inte

us that the Omnibus bill for 1996 would allow $2,000,000 for emergency listings, del

3

This amount consists of funds for personnel to draft recovery plans and to coord

actual recovery efforts are found in other accounts such as the funding of the Nationa

Consultations, Captive propagation programs, grants to states, Partners for Wildlife, th

Conservation and Restoration, and others. 

• See last section on recovery planning for more details on the costs of recovery

9 
ESA ACI'JVITIES FUNDED IN OTHER ACCOUNTS: 

IW'UGf.S AND WILDLifE; 

The goal of the NatiOnal Wildlife Rcfuae System is "To preserve, restore, and 

species of animals and plants that arc endlnaered or thrcatenCd with becoming endan

System have at leut one threatened or endlnaered species during some part of the ye

established specifically to prOtect tbrcatcned and endlnaered species, and 36 contain 

In lllllllY cases refuaes protect lands which form the nucleus of a larger ecosystem ne

intcgraJ componimts in the implementltion of Recovery Plans in support of the Endan

species listed under t1ic cndlnacrcd Species Act, approximately 232 (24%) occur and

these, approximately SS% arc improving or stable. • 

Since 24% of spcc:ics have habitat within the refuae system I have allocated 2

cndangcrcd or threatened species. 

1995 1

RUUGESTOTAL OPEBADONS A MAINTENANCE: $167,131,800 $169

Allocated to endangered and tbrcatcned . s 41,957,750 s 42,

spcc:ics 

•Rcfuaes Law Enfon:ement s 35,517,800 s 35,

ESA 2S% • s 1,179,250 s 8,

•Law Enfon:cment(ESA) s 11,253,800 s 11,

10 
1995 

*Fisheries Enforcement s 2,856,000 s 3

ESA 25% s 714,000 s 

*Wildlife Enforcement $21,141,000 $21

ESA 25% s 5,285,250 s 5

•Permits/CITES 

International s 3,438,000 s 3

$5,301,000 total for international in 1997. 

•cooperative Endangered 

Species Fund s 8.983.000 $8

TOTALS $80,510,250 $79

HABITAT PROTECTION AND RESTORATION PROGRAMS THAT BENE

SPECIES OR CANDIDATE SPECIES: 

*Partners for WildlifeTechnical Assistance and habitat restoration 

includes Forest Plan "Jobs in the Woods" 

Ecosystem Restoration Projects 

*Project Planning - permit reviews of other 

agencies, 404 permits, hydropower permits 

•coastal Ecosystems Program 

*National Wetlands Inventory 

TOTALS 

$18,985,000 

$22,887,000 

$ 6,351,000 

s 4.000.000 

$55,973,000 

II 

$22

$21

$ 6

$4.

$56
PROTECTION OF FISH: 

*Fisheries- Fish Stewardship 

Focuses on restoring fishery resources through 

habitat restoration, resource conservation, 

evaluation of hatchery products, conservation 

of genetic diversity and evaluation of fish health. 

*Imperiled Anadromous Species -9 hatcheries 

are involved in captive propagation of threatened, 

endangered, and candidate fish species. 

*Inland Imperiled Species -

captive propagation at 17 National Fish Hatcheries 

to reverse the decline of several 

listed species. 

1995 1

$ 2,05

$ 1,79

$3,05

*Lower Snake River compensation plan -- a fish production program comprised of 23 

facilities constructed by the Army Corps of Engineers at a cost of nearly $200,000,00

nearly double this figure. The plan was authorized by the Water Resources Developm

salmon, steelhead and rainbow trout caused by the four federal dams on the lower Sn

an average of approximately 15,000,000 salmon, steelhead and rainbow trout weighin

funded by the Bonneville Power Administration through its power rates. The money i

which makes the funds available at the beginning of the year and BP A repays by the 

*Fish and Wildlife Managementworks with ESA listed fish 

TOTALS 

$11,557,000 

$15,851,000 

$11,5

$16,2

$34,7

12 
1995 

GENERAL AQMINISTRATIVE COSTS: 

•FWS central office ldminisanaion 

•Regional office administration 

•Servicewicle ldminisanaive support • 

TOTALS 

ISA at 15% 

$13,618.000 

$13,033,000 

$43.013.000 

$'79,674,000 

$19,911,180 

CONSTRUCDON AND LAND COSTS: 

•Land Acquisition for FY 1994-95 for ESA was 10,342 acres. 

For ESA alone over S17,436,1M was spent in 1994 and 511.131,088 in 1995. 

OTHER MISCELLANEOUS FIJNDS: 

•National Fish IIIII Wilcllife FOUIIdation' s 5,490,000 

$13

511

H7

511

$10

s 4

'This Foundation encounps and administen donations of real or personal prop

Donations have been applied to recovery of various endangeml species such as the 

grizzly bear, and others. 

13 
1995 

*The Migratory Bird Conservation Account6 S 40,928,000 

• African Elephant Conservation Fund7 S 1,200,000 

*Rhino!Tiger Conservation Fund -NA-

•cooperative Endangered Species Conservation 

Fund - Grants to States' S 25,480,000 

*Federal Aid in Wildlife Restoration -

Payments to states-Requires no appropriation9 $233,352,000 

*Lahontan Valley/Pyramid Lake Fish 

and Wildlife Fund s 152,000 

1

s 44,

s 6

s 2

s 27,

$240

s 

6 This account funds land acquisition for waterfowl breeding, wintering and migr

migratory bird populations and others. 

7 This account provides funds for assisting nations and organizations involved wi

1 This is a fund out of which are appropriated funds for grants to states under S

conserve and monitor candidate and listed species. Included are funds for a Section 

The balance in the fund at the end of 1997 will be $134,898,000. 

9 Permanent Appropriation -derived from excise tax on firearms, ammunition, an

$15,055,000 requested for Fish and Wildlife Service a~inJstrative expenses. 

14 
1995 

•Wildlife Conservation and Appreciation Fund 

Grants to implement 

Partnerships for Wildlife Act s 800,000 

TOTALS $307,402,000 

GRAND TOTAL $517,717,750 

IS 
COSTS OF RECOVERY 

The Fish and Wildlife Service was appropriated $36,500,000 for "recovery" o

However, spending on recovery far exceeds this amount and is often accomplished by 

private non profit organizations, corporations, and many times by private citizens. R

Fish and Wildlife Service regional personnel in the Ecological Services Division assig

1,514 species listed as endangered or threatened, only 514 had recovery plans as of F

Offices recently responded to a request to examine costs of a sampling of recovery p

Committee with information on estimated recovery costs for a nwnber of high priorit

$145,000 for the White River Spinedace to $153.8 million for the green sea turtle. H

the National Marine Fisheries Service both warn that these costs are "highly subjectiv

economic analysis". In addition, while the recovery plan will list a "menu" of activit

recovery of a species, not all the actions proposed are eventually carried out. There 

implemented and many of the actions proposed are never carried out. 

However, many actions that contribute to the recovery of a species may not b

that contribute to recovery may be carried out separate from the recovery plan. In m

Some species benefit by simply prohibiting their actual take. One such example is th

gray whale recovered after the imposition of an international ban on whaling. 

The increase in populations of the California Condor are primarily due to the 

The Peregrine Fund, which breeds rare birds of prey. The Hawaiian Gardenia has be

control nonnative plant pests. Efforts to protect and restore wetlands have greatly co

fish and birds. 

In conclusion, it is probably impossible to quantify the costs of recovery since 

other expenditures and the estimated costs found in recovery plans may bear no actua

For further information contact: Elizabeth Megginson, Counsel, 225-7800. 

16 
In conclusion, it is probably impossible to quantify the costs of recovery 

other expenditures and the estimated costs found iri recovery plans may bear no 

For further information contact: Elizabeth Megginson, Counsel, 225-7800. 

17 
Federal and State Expenditures for Endangered and 

1991-1997 

Taken from the Annual Report "of the Fish and Wildl

and from budget documents submitted to the Committee on Resources by 

The Annual Report to Congress substantially under reports ESA related spending. The e

related to a specific species and does not include general administrative and s

A few agencies with very small expenditures have be

Prepared by the Committee on Resources, Majority Staff, Office of the Chief Counsel 

For further information call 202-225-7800 

! Agency 1991 1992 1993 1994 1995 1 

Fish and Wildlife $124,550,000 $137,235,000 $151,781,000 $151 ,529,000 $191 ,443

Service real 

expenditures' 

Fish and Wildlife $54,517,000 $55,068,000 $58,461,000 $44,207,000' Not avail

! Service reported 

' on specific 

species1 

I National $10,725,000 N/A 

Biological 

Services L._ 
Agency 1991 1992 1993 

Bureau of Land $6,884,000 S I 0,490,000 s 14,484,000 

Management 

Bureau of $11,256,000 $23,248,000 $33,433,000 

Reclamation 

National Park $3,809,000 $3,830,000 $3,282,000 

Service 

Bureau of Indian $3,460,000 $2,968,000 $3,684,000 

Affairs 

Forest Service $19,389,000 $21,808,000 $39,248,000 

National Marine $3,605,000 $8,500,000 $8,600,000 

Fisheries Service 

Dept. of Defense $7,534,000 $11,000,000 s 11,568,000 

1994 19951 

$14,642,000 $17,992,0

$27,951,000 N/A 

$3,901,000 N/A 

$4,765,000 N/A 

$21,100,000 $23,542,0

$17,000,000 $21,100,0

$16,318,000 $19,523,0

2 
Agency 1991 1992 1993 

Army Corps of $7,675,000 $83,368,000 $33,960,000 

Engineers 

Dept. of Energy' $24,790,000 $32,490,000 

Bonneville Power $89,600,000 $169,900,000 

Administration' 

APHIS $630,000 $1,049,000 $2,617,00010 

$1,744,000 

! 

Environmental $2,918,000 $2,862,000 $2,862,000 

Protection 

Agency 

I 

Fed. Energy " $232,000 $512,000 

Regulatory 

Commission 

Fed. Highway $5,424,000 $1 ,882,000 $2,108,000 

Administration 

---

1994 19951 

$51,829,000 $94,825,0

$11 ,990,000 $21 ,110,0

$189,300,000 $252, I 00

$1 ,71 4,000 N/A 

$636,000 11 NIA 

$322,000 N/A 

$6,950,00013 N/A 

3 
AJCIICY 1991 1992 1993 1994 1995' 

Fed. AviUion $5,000 $45,000 $4,271,000 $175,000 NIA 

Administrltion 

T-Valley $202,000 SlOO,OOO $230,000 NIA NIA 

Authority 

Natural R-..:e " .. $1,119,000 $2,090,000 N/A 

Conservation 

Service" 

Scale reports" 5'4,126,700 5131,450,700 S 13,025,500 $14,500,000 N/A 

II 

Total witb FWS $261,462,700 S5S4,5S7, 700 $529,174,000 $547,437,000 1'41,635,

-- 

Totals with FWS $191,434,700 $472,390,700 $435,154,000 $440,115,000 

nported-by 

species 

1. The -uat report to Conpeu hal not been compiled or calc:ul8ted for 199S. These numb

ac:h apncy upon request. 

2. This compugtion includes Ecolocical Servk:cs for ESA and enfon:ement of ESA, habitat 

111C1 maintcnlmc:e, but not land ICqllisition. Does not include fisheries, special ESA funds or g

4 
3. These amounts come from the Annual Report Congress and are only those expen

species and do not include other general ESA program costs. 

4. The raw data for this entry was submitted to the Committee but was not totaled, 

the raw data. 

S. Until 1994, the research conducted on endangered and threatened species was dis

the Secretary created the National Biological Survey, later the name was changed to 

funds were then transferred into the NBS. Therefore, 1994 is the first year for which 

6. Taken from the BLM Budget Justification. 

7. Taken from the Forest Service budget justification. Total request for Wildlife an

$93,182,000 for 1995, $85,500,000 for 1996, and $91,000,000 for 1997. This cate

species. The figures for 1995, 1996, and 1997 are the actual appropriation or budget 

species program within the Wildlife and Fisheries category. 

8. The Department of Energy did not submit information for the Annual Report to C

information was provided directly to the Committee by the DOE. 

9. BPA did not contribute to the Fish and Wildlife Service report for 1991-92. This 

Committee by BPA. According to BPA the fish and wildlife budget agreement anno

calls for Bonneville's annual fish and wildlife expenses to average $435 million per y

This amount includes ESA related expenditures. Although Bonneville reimburses oth

these figures do not reflect double counting of these expenditures. 

10. In 1993, APillS (Animal and Plant Health Inspection Service, Dept. of Agricult

expenditures that were related to one species but indicated that the total for ESA was 

costs were attributable to more than one species. This is probably a more honest app

I I. In the three prior years the EPA always included in their submittal amounts for 

5 
cooperative agreements with the states, salaries and benefits, and contracts and expens

and only submitted amounts allocated to a specific species. 

12. In 1991, FERC wrote a Jetter explaining that their ESA related expenditures wer

project reviews and were not broken down by species. Therefore, while they had exp

their record keeping methods did not fit into the reporting requirements. 

13. There was a substantial disparity in the amount submitted to the Committee by th

and Wildlife Service. It is unclear why the disparity. This figure comes from docum

the FHA. 

14. The Natural Resources Conservation Service was formerly the Soil Conservation 

IS. SCS did not maintain records on a species by species basis at that time. Howeve

field offices to provide information and technical assistance to agriculture on endange

16. No report filed for 1992 by SCS. 

17. State reporting was voluntary and not all states submitted the information as req

information is compiled with the assistance of the International Association of Fish an

18. This included a significant amount for land acquisition. 

6 
217 

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Alulcl Natln Claiml Settlemeat Ac\ a U.S.C. 

1101-tm. Requlm hSecretaryolhinllrtariD 

withdraw up liD eo million aae olexlltlns public 

lind for cmslderadon as,_ Ntlonal wlldllle m· ..... 

• Aulhariza- of ApptoprlatiGno: N/ A 

Aallrctl<c-.ti ... Adoltm, U U.S.C.:HDL 

Provldebh...-w_...S....,......olh 

fauna...S llola ol "'*'<ttca....Solh....,_. 

upon whlcllsudlllola ....S fa- dlpend. 

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end sites which aa on public end lndl.wlllndl, ...S 

for incr-.d cooperation ....S _,...,. <JI lnfotmo. 

218 

... ..__.,........~ ... ........ llonol aodlaoalopcal...........,, ...s ...... .... .......... calllcllansof....._....,.._ 

...SdataoMolneoi ...... Odolllr31,1979. 

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AIIAIIIk c:.....a ........_ c..pontlw .......... 

- Ac\ P.L 11Do3116. Proride fDr ,...._. 

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Septembor30, 1991i 

Atlulk Stdped ._ c-rv-Ac\ 1t U.S.C. 

1151 -· M ........tid. Authoriza studios, md proridel for lidiYitloo liD •tDra Atlontlc striped 

but, lndudlnc. under certain aJndltlons. dedua-

-loyh!iecretortot "'hlntorior ...s Coonmolca 

"' • ..........n- a.. liiNnB ,.,.. "-lflldes In 

-.111 watero <JI Sta.., ht do ...Cimfllen-1 end 

.._ ............................ plonforstrlpod 

... 

• Autharlzatlon <JI Appropriations: Expbed Sepllder30,19N . 

llold..,.GciWm&oaJePioeocllonAd,uamendod, 

16 u.s.c. ......... This Ad moloes lllllegaiiD 

Import. export .or lllce bald or goldon eastes. or to 

MI.~ orbarllrlhtlrportt.-,or'llllloot 

producllllllldefnlllltheanlmals,lhtlrneslloregp. 

• Aulhorlu-<JI Appropriations: N/ A 

. a..hollalUYwBulaFiahely...__Shldy .... 

a-at~ .. Acl ol~ P.L 101-G2. Authorizes a 

joint Fedenl. Stott ...... Trlb&llludy,.,.. ............ 

- <JI hlllllay _....of the Chehalis RIYer 

Buill. Wuhlnplft. 

• Authorlza-<JI AJIPIOPriatlons: N/A 

OoaaWallr,Ac\ u......._33U.S.CU51·1317. 

5octlan 4IM (m) authorizes h Fish ....S Wlldlu. 

Srrvft In pmoidP ...,_., .. address .. pennll 

appbci:th .... . _,,_: t.•r·•lt:,i ·-' tf-e: 1.1~ . . ~my Corps ol 

fn&ll*nl'orthe~ : urOilged ~~~~­

riallniD I'IIVipiiW-ofh Unleed Stoles. Sectlon:Q(I)authorlzesthe FbhandWIIclllfeServiceiD 

prOYide leChnlcal assl-.oe 1D Stales In developlnj! 

• 
219 

"best .........,- pn<t~oeo• u part ollto wallr 

poUution oonlrol prosnmo....S toa>nllnwwlll\ the 

National Wetlands liwmiDiy. Section 320 aulhl>-

rbel the eslllbu.halent Ola State/Fecleral cooperative propam to nominate estuaries ol national olgnlllcance an4 to deooJop an4 Implement INNIS"' 

mont plant to ........ ....s awlnlllln the biological 

....S c:hemlcallneeplty ollltuarine waters. 

• Authorization ol Apploprlatlons: N/ A 

Coutalllullw a-Act (CBKA) of Ul1u 

amonded by the Coootal 8urilr ~ kt 

(CBIA)ol1990, 16U.S.C3501. ltequlm thei'IIII....S 

Wildlife s.m.e to produce rwiMd ·maps ol the 

Coatallllnilr ReoclunB SyHI!In.aubmlta ttudyto 

Cmpss on the .-1 to Include the WatCout In 

the5y11lem.anclsuhmltdnftmapsoftheWestCout 

to accompany the report. Require the Secretary of 

lnlerlor to lead an lnllrtpncy task focce to provide 

recommendations to CDngreoo for legislative ICIIcn 

....SFederalpollclesondeoeloped....Sundeveloped 

coastallwrlen. · 

• Authorization of Approprlatlona: Expire• 

Sepll!mber30, 1998 

Colon4o Rlnr Ston&• Project Act, " U.S.C. 620. 

Prorid•lbat fadlltlet wiU be built ....s operaled to 

mitigate ...... ol, ancllmproft condltlont for, lbh 

....S wlkWfe In connection will\ the Colorado River 

Storoge. 

• Authorization of AppropriatioN: N/ A 

· CompnhcNift En'rilonaoatal Rat..-, Compenaaticm,.an4 UabWty Act, u amalded.UUS.C. 

HOI, et teq-ltequlm responsible partiet,lnd...uns 

Federal Jandownen, to lnvestlpte ....S deon up 

releues of h&unlout • ....._, ....s·- for 

nalllrll reaour<ea to.....,anc!NCDW!I'<Iamaptfor 

lnjwy to nalllrlll'I!IOIIICel ham rei..,. ol h&unl· 

ous aubttancet....S we theclamlpt for restoration, 

replacement or acquisition ol equivalent nalllrll 

retoUl'Cel-

• Authorization of Apptoprlatlont: N/ A 

· • Provides permll*lt authorization to appropriate 

.-!piS from zesponslble partlet 

EmupneyWed&a4t-Act,16U.S.C.3931, 

u _,.4e4 by P.L JG.4tO. This kt pwmltt the 

collection of entran<e r.es, thirty peralll ol.whkh 

maybeutedforrefugeoperatioruo....Smalnll!nance, 

....S requireflbat the Seae<ary ollnterlor eatabtish 

~ 

....S periodically mrlew a National wetlandt prlorityCXJniKfttionplanforl'ederal....SStatewedands 

acqulsllicm,. complete National Wetlands liwmlllly 

maptfortheamtlguoutUnlledStates.,YSeptember 

30, 1998, update the report on wetland> statui ....S 

tnnb by 5epteJN1er 30,1990,-s at lt).yetr Inter-

..., e-fter, produ<e wetlan4 maps of Alaska by 

September 30, 2000, produce a cflsltal4alllbue for 

theUnlllldStatesbySeptieml>er30,200f,anclan:hift 

anclmake&lalmapt....Sdlgl~4ateavallablefor 

dlttrlbutlon. 

• Authorization ol Approprlatlont: N/ A 

lin4aft&ere4 Sped• Act of tm, t' u.s.c. 1531-

UM,u-a.L Thlsktpn>hlbltothelmporta· 

lion, exportation, taking. ....s COINIIeldallzat In 

lnlentete or foreign CIOmmerce of flsh ....S wildlife 

....S plantt 11\at .,. llaled ai lhftetoned or erdan· 

pred apedet. The kt piOVIdet for adding specleo 

to the Ustoflhftetoned andendangereclwlldJifeoncl 

planto, one! lorpn:parlng ....S Implementing recov- ery plant .for their amservaticn. It provides for 

lntemgencycoopentlonwlll\otherFederala(ll!l'des 

....S btulngpwmltt for otherwise prohlblled actlvl· 

ties. The kt alto lmplemenb lhe provisioN of the 

Cmwntlon on lnllrnational Trade In Endanpred 

Species ol WIJcl Flora ....S Fauna (cm:s). 

• Authorization ol Apptoprlatlono: E'xplml Sepll!mber30, 1992 . 

Federal laMctld4e, Funpdde and Rodendddo 

C.ll'al Act. 1 u.s.c. u.m1. 1tequ1m registzaticn ol pestlddes to avoid unreasonable advene 

effecto to humans or the enviJonment. 

• Authorization of Appmprlatlono: N/ A 

Federal Power Act, U U.S.C. '19U et~. ltequlm 

11\at ..t. lleense for hydropower projectt blued by 

the Fedenl Enqy RegulaiDiyCommlttlon Include 

lbhwayt prescribed by lhe Secretary ol the Interior 

or Coaunorce, ....S condltiont for the protedlon. 

mitigation ....s enharw:ement of flsh ....s wildlife 

bued on rec:oallll!ndatlono ol the l'lth and Wildlife 

Service ....s other agendes. 

• AuthorlzationofApproprtationt: N/A 

flth ....S Wildlife Act ol UW, • amended, 16 

V.S.C. 7U(a._7M. Etlllbllshes a C10mprohenslve 

national flsh ....S wild We policy IIIII au ~bon- the 

Seaetaryofthelnteriortotaketteptrequindforthe 

deoelopment. management. adv_....t, CIIN«· 

vetlon, IIIII protection of fltherles raources one! 
wlldllle-"""""' ..-ell. .cqulsltlan ol ................... llol~~ ..... 

Olher--. 

• Aulhol1allan ol Apptoprllllonl: N/ A 

11th 11101 WUciU& CanoervatlcmAd, MlllleNied, 

16 u.s.c. 2!101·2ft1. a.-the Soaetuy ol the 

lnlalor to undertake .-.dl IIIOianavationac-

~ In Cl10C'dlnallcn with Olher Fwdenl. ...... lnlemallonol.nd prmleorpnlzallant, lo uslst In 

~hit .... pono~~~~~~t~oo to-mlgraiDiy 

-...... blnlo lftleri'JIIsllns ... lhorlllll. Spedllcally,theSoaetuylonquiNdlo_ ... thefallowtng(or 

all •pede. oubspode • and pOpulollcnl ol mlpaloly nonpmt blnle: monllor and-population 

trends ond ·-· ideJIIIIy effects ol environmental chonge and human Ktlvlllel, ideJIIIIy •pedes In 

need ol addllionalcanservation actions, and ldontily c:onMrYation ICIIons ID ~ perpetuation ol 

JN. species. 

• Aldhoriation ol Appropriations: Expires Sop- . 

lember30, 1997 

l'lohuwiWUciU&Coanllnollan Act,.16 U.S.C. 661· 

666(e), • ..........._ a.-the l'loh n Wildlife 

Servb ID ln-llple llld rtport an .,.....S fed. 

eral actions lhal atlect...,- or Olher body ol 

waterondtoptoYidenc:GIIIIIII!Jidllcnltomlnlmlze 

ilnpacb an lbh llld wildlife,_ 

• Authorization ol Appn>prlldanl: N/ A 

floh.IUaRolltlcmFII'IIIIIIcl'nipoaAd oiMIIdo 

u. 1951,16 u.s.c ,.,.,.., autharlal the S.C... 

taryolthelnlertottoestabllohexpllbneilolllallcnl 

b.-dlond oper' .............. 

• Aulhorizallcnol ~ N/A 

floodpllla Monase-t. ....... Olda u,.._ ........ thltl'ecleraii)'1IWlloodplllnl.....,... ror Jeue or_...,..... to__,.,... public or prmeo putla .. pnllll:led .......... .-tctlns .... 

- KIIYillll thot would """" the lloodploln ... -In the C111ftWYM<11 or wlthhald such,...,.... 

tles,_Jeueordlsfaal 

• Aalharlzallcn ol Appooptlolkw., N/ A • ~ 

tiwOrdor 

,...s.auii)'Adoi191SM__.....,tbe.,..... 

.Apalllui,~-TradiAdoiUII 

CP..L 101-GI),U U.S.C. _...._ -.qw... ... Secntary ol ~ ID CICIIIIOIIt with the S.C... 

tory olinlerlor on .,. ldllllillallan ol --.m, 

220 

dolormlnotlonsol~llld--olft!IU" 

~ tocany-the povislonl ol thll Ad. .... 

quiNS ... l'ioh ond WUdllfe Service 1D C"llnalr In 

wetland mltlptlon ..... In IISIOdation with -

maleHictaempllcnlllld toan:urln ......... allcn 

plans for londs JIIVPCIMd for Inclusion In the Wetlonds Raerve PJogram. Eotabllshos • program to 

protod and - wetlands an Pumen Home Admlnlotratlan lnftniDry poporty ond provides 

b the l'loh n WlldHft Serva ~o ~c~en~~ry such 

wetlonds. 

• Authorization ol Apptopriallcnl: N/ A 

Creal Llkoo Ottkal .....,._ Ad ol1!190, CP.L 

101·5961. Cantaln:o sewrollltles; pn>YisloNdlnctly 

authorlrlng Service activities are oontalned In IIIIa 

ID,the~O.....plalnSpedaiDeslptionAdof 

1990" . 

• Authorizalion ol Appropriations: Expired Seplember 30, 1995 

Creal LaJce. FJah 11101 WUciUfe Rettontlan Ad of 

1!190,P.L 101-537.Authorlzes theSavlcetoconduct 

a lludy of facton ~ C..II.Mes llshely,.. 

oources, 1o develop JOCXIDuJ..,oded corrOctive acllant, llld to establish aiOidlnation n llshery ... 

ooun:e olficiD for the J>UlPIIM ol aalstlng theQeat 

I.MesCoamaslon. Slalll,lndlln Tdbes, ond Olher 

lnlereslld parties In cooperative .....,.lion. ..... 

toralion .................. 1 ol the lbh and wlldli(e 

--habitats oltheC..II.Mes luln. 

• Aulhorlzalion ol Approprlltlons: Expired Seplember 30,1995 

~ 

co- Llkoo FlahoiJ Adol1951,16 u.s.c. m.-. 

theCGnwnllcn ... C..IUk.es Fisher-

-.,__the UnltedSta•llld c.nada. 

• -tionof API""J"Je'ICi N/A 

'ne:md'•·'faub • ......_A.c:\.22UAC. 

251.2JS1a,2152. Authorbathei'Noldonttofurnllh 

....._ to..,.....ln Jlftllldlnln-.... ....wlldlife....._ .... ..........,..,....ondln 

...,..wlldllle......,mllond plant_. 

............... Auloadle ........... ..._ 

._ u <;. ..t nthl!r ....-too otocllntloll n 0111er 

Dp<> ~ ,, '"" ·,Jo!<l!< of fiiVIro-...1 Idona! ond 

........... ~~. . 

• AudiGIIzatlan ol Appnlprlallons: N/ A 
221 

jullcwDudr:Sialllpc-mlan-' Dalsn fro. 

pmAd(P".LlOWtll). AlllhDrlzes!heSeaelalyto 

anyouttheprogram.whldaprovldesenvlronJnen. 

111 eel-lion opportunlllllto Jdlool chlldn!n mat· 1ng to the conoervatlon and INNgem<nt ol migratory blnll; allows ... annual Junior Duck Stamp 

competition. and provides ,. the licensing and 

mar1<et1ng of winning designs. wllh proceeds used 

for awards and ICholanhlps 10 partlclpanls. 

• Authorization of Appropriations: Expires September 30. 2000 / 

JCiamath River Balin flohay R-..-o Rutoratlon Act, 16 U.S.C. 7-, ft!C!ulres the 5eaelaly of 

the lnlerior 10 develop and Implement a restoralillll 

plan for the Klamath River Buln. 

• Authorization of Appropriations: Expires September 30, 2006 

Lacoy Ad Amendmenta of U81, 18 U.S.C. '2; 16 

U.S.C. 3371-33'111. Provides authority 10 the Sea... 

tary of lnlerior 10 designate Injurious wlldUfe and 

ensure the humane treatment of wildUleshlpped to 

the United States. It prohibits the Importation, ex· 

portatlon, transportation. sale. or pun:hase of fioh 

and wlldiiiR taken or pouesaed In violation of stale, 

Federal, Indian lribal.andfcnigJIIaws. The Amendments atrelglhen enforcement of Federal wildlife 

laws and Improve Federal ualstance 10 the Slates 

and foreign govemments In the enforcement of their 

wlldUfelaws. 

• Authorization of Appropriations: N/ A 

Map-flahGyc-rnll ... an4MGiasoment 

Act, u Ulended, 16 U.S.C. 1101·1882. Provides a 

fruMworkfrlmanaslng flsherleswllhlnthe&du· 

.m J!ccnomlc z:one, 1n part lhrouJhestablillln8lt 

of eiJhl Reg1ana1 Fishery Manaprnont CoundiJ on 

each ol which the U.S. Fish and WlldlllaServlce Is a 

non-vot~ns member. 

• Authorization of Appropriations: N/A 

Mulne M......W l'rotecll.., Act, 16 U.S.C. U&l· 

tta7. Eatabllshos a mondllriiiDI on the lllclnS and 

importation ol marine GIIIMWI, Including parts 

and prod. .. rts, lllldd.ofinel~"'"f''"''bJlityfor 

COOMrVatlon ol marine JllaDIIIIals, wllh manapmont authority vest.! In the Depanrnoslt of the 

lnleriorforlheaao-,walrul, polarbear,dugong. 

and manatee. 

24·936 96-8 

• Authorization ol Approprlatlcns: ExpUes September30,1997 . 

Mlplol)' Bini ConMrntiOft Act, 16 U.S.C. 715-

7154. Authorll.es lhe 5eaelaly ollhe lnlerior 10 

condu<tlnvestlptl .... and publilh documents JelatedtoNorthAm!r!Canblrds. EstabllshesaMigraloly Bini eor-vatlon Commlulon to approve ar· 

- n!COIIImOnded by lhe 5eaelaly for aoqulslllon. 

The MBCC .Joe> approves wetlancls conoervalillll 

projects lecommended bylheNcirth American Wetlandsc.o.-vatlonCoundl undertheNorthAmorl· 

con Wetlands c.o.-vat~wa Ad. 

• Authorization of Approprtatlons: N/ A 

MlptGJyBinl Hmlln&and c-rndOftSiamp 

Act, 16 U.S.C. 718. This Act, co.....-Iy referred to 

u the "Duck Stamp Act,• ""'uires walerfowlhuni· 

ers, 16years of aporolder, to purd>ueand possess 

a vllld Federal waterfowl hunting stamp prior to 

taking migratory waterfowl. 

• Authorization of Appropriations: N/ A 

Mlplol)' Bini Truty Ad ofma, u aumuled, 16 

U.S.C.l'0).712. This Ad Implements four lnternatlonlltreatleolhatlndlvlduaDyaSectJnisratoryblnll 

common to the United StallS, c.nada. Mexico, Ja· pan. and the former Soviet Union. The Ad eatablilhed the federal respontiblllty for protection and 

INNgem<nl of Jnlsraloly and nongame blniJ, indudlnglheestabllshmentof IRSOI\Ienglh. bag lilnlts, and other hunllns 1'18111atlons, and lhe Issof permits to band. posseos«otherwisemakeUMof 

migratory blnll. &apt .. allowed by ImplementIng regulations, lhla Ad mabs It unlawlul to pur· 

sue,hunl, ldll,capture. poueu, buy, Mil.~ 

or borler ony Jnisratory bird, lndudlng lhe lathers 

or other parts, - · flllll• «migratory bird prod· -· • Authorization of Approprlatlcns: . N/A 

Natl....t A.....,J- Ad ol1-,16 U.S.C. - · 211111. Diftdlthe 5eaelaly of lhe INBior to parlldpale In lhe dnelopmlnl ola Nallonal AqUOJitunt 

Dovelopcnent Plall and aulhDrlzes .-.dl. denJ. 

"""""''' """'llherlldiYIIIN toenmuragethedevol- opmenl or *jl>II<Ulwro tn lhe Jniied SlAtes. 

• Authorization of Appropriations: Explnod September 30, 1993 
National En-ental Pallq Act ot 1969, u 

........ ..t, &2 u.s.c. C3Z1 ft. .... Requires the Service to examine the environmental 1mpocts oflb 

actlons,lncorporateenvlronnellilllnformallon,and 

ullllupubUcpartldpotlonlntheplomlngandlmpJ.. 

mentation ol aU actions. Raqulres the Service to 

Integrate NEP A with other pW!nlng requlreinenta, 

andp<epUeappropn.leNEI'Adocwnontatofadll· 

tatebetterenvlronmentaldedllonrnoJdns. Raquires 

theServlcetorwlowanda>mmentonFedenlapncy 

environmental plans/docwnonta when the Sorvloe hu jurbdktlon by law. or apedol e:xpertile with 

mpect ID any envln>nmentallmpocts Involved. 

• Authoriutlonof Appropriations: N/A 

National Flah and Wildlife F.....,..atlon EatabJllh. 

ment Act, 16 U.S.C. 3'101 ei.OO'(.f.naded In 1984,the 

Act established a federally chartered, nonprofit ror· 

poratlon to en<ourap and administer donations of 

property, for the benefit of the US. Flab and Wildlife 

Service prosrams and other activities aimed at the 

c:orUervatlon ol fish, wildlife, and plant resouroes. 

• Authoriutlon ol Appropriations: Expires September 30, 1998 

National Hlatorlc l'nMrYation Act of l966, u 

amendod, 16 U.S.C. ''10-4701>, ,-. This Act 

direds Federal agencies to preserve, mtore, and 

maintain the historic cultural environment of lhe 

area. 

• Authorization of Appropriations: N/ A 

National WUdllfollofugo Syotom Admlnlotntion 

Act of l966, 16 U.S.C. 661dd-.e. Constltuteo an 

•0rpn1c Acr' for the National Wildlife Refuge System and provides guidelines and directives for ad· 

minlstntlon and lllllftlgl!fllet of aU IIUS In the 

syotem. 

• Authoriudon of Appropriations: N/ A 

Now England flahory lloooan:eo lleotoratlon Act 

of 1990, P .L ID1·593. Authoriuo the Sorvic:e to for· 

mulate, eatabllah, and lmplemont cooperative programs to mtore and malntalnnatlonaUy >ignlficant 

lnleljurlsdictlonal fisherymouroeoln New England 

river systems. 

• Authoriudonof Appropriations: N/A 

NonlndlsonouAquatlcNuiNnceSpodnPrnOfto 

lion and Control Act of 1990, P.L 101..-. Authorl:r.es the Setvke to develop and Implement a programtopreventandrontrollnlestationsoflhecoaslal 

222 

lnbnd waten of the United States by zebA mUJOOI, 

and other nanlndlgenous aquatic IUIIaance opodel • 

This Act allo eatabUahea the National CDutal Wet· 

lands P1aM1ng. Protocllon, and Restoration J'ro. 

sram within the Sport flah lloltoratlon Acrount foe 

projects authorized by the North American Wet· 

lands Conoervatlon Act In routalatates. 

• Autnorlzatlon of Appropriations: Eap...S September 30, 1995 

North Aamlcan Wotlancla C.......ation Act ol 

1!1119, P .L ID1·Z33. This Act provldos for partnor· 

lhlpl between public asendes and other lnlaeltaln 

c:.nada, Mexico and the US. to: protoct,. enhonoe, 

..,...,.., and manase wetland ecooystemo ond other 

habltataformlgratoryblnbandotherfilhandwUdUfe; rnalnlaln c:unont or Improved distributions o1 

migratory bird populations; and suslaln an abun· 

~of wall!rfowl and other mlptory birds ron· 

slstatt with the North American Waterfowl Manasement Plan and International cibUgatlons with 

other countries. Requim S.year upd.ate to the Plan 

and detaUed reporting of projocta. Raquires 50:50 

matching funds. 

• Authorization of Appropriations: Expirea September 30, 1998 

OU Pollution Act of 1990, P.L 101-310. Raquires 

consullation with the Flab and WUdUfe Service for 

development of a •filh and wildlife mponoe plan. 

.Jor lhe Immediate and effective prolection, mcue, 

and rehabilitation of, and theminlmlzatlonol rill< of 

damase to, filh and wildlife resouta!S and their 

habitat that are hannod or that may be jeopardized 

by an oU discharge. 

• Authoriutlon of Appropriations: N I A to FWS 

Appropriadons 

,._on of Wetland1, Executin Order 11990. 

Requira that Federally-owned wetlands propooed 

for lease or c:cnveyan<e ID non-Fedenl public or 

private parties be protected through mtricting wry 

future..,.. that would desradeorhann the wetland 

reoc>Um!lnlhec:cnveyan<eorwlthholdsuchproper· 

ties from lease or disposal. 

• Authorization of Appropriadons: N/ A · Exo!cu· 

live Order 

l'llbllc Utlllty Roplatory Palldea Act of 1971, 16 

U.S.C. 2602 . andl!no'IJ Security Act of 1910, 

16 u.s.c. 19Ull(d. Dim:ts that any exemption 

from licensing granted for a small ~ 
223 

JIOW"< pnlject 11\1111 COIJ1'Iy with terms and condl- 11\allonalexlstlniandhaeun"adnlnganu. Thel'i.h 

liens thai Fedenol or Slalellshand wlldUfe apndes and Wlldllle Servkle provides t.:hnlall Ulistano» 

havecletennlMclareappcoprlaletoprevmtlosoof, for llsh and wlldUfe aspects of the IllparUNnt'o 

or clanlage to,llsh ond wlldUfe reiOIIfCIOS, The Fish programs.., active and Dndoned mine linda. 

and WlldllleServklelsalloaulhorlzed tolnvesllpte • Authori...llon of Approprlallono: N/ A 

and report .., effects ol hydropower develop1T811 Supl111 ~ lor Wllclllle Act of1961, '1 U.S.C. 

.., llsh and wlldllle durln3the llcontlng procftf of """""· Authorizes the Secnlary of the Inllrlot to 

the Federal Enerzy RegulaiDry Commlulon. • tequeSiaurplusplnfrom theSoaetaryof Ajpiall· 

• Authorization of Appropdallono: N/ A hint lor the ellleJ8II'CY r-11ng of reoldont p111A 

ROCI'Utianol UM of Floh and Wlldllle Anu, 16 

u.s.c. -~ c:aa.naNy known u the ll.efup llec:rallon Act of 1962,authorizas theSecnlary 

of the lntl!rlor toadmlnlslerrefups,haldwrleo, and 

other conservallon anoslor zecreationalll!t! wlwn 

tudl uoe does not lnlerfere with the prlmiry purpooe lor which these.,.,.. were establlshod. 

• Authorizallon of Appropriallcns: N/ A 

Rooource ConMnrallon Ra<ovny Act. P.L H-510, 

UU.S.C.6901,Enacted0ctober21,1976;AIIlmdod: 

1978,1980, 19M. RegulalleS the llellml!nl, transportation, storage, and dlspooal of aoUd and hazardous 

wastes. The Servkle Ia Nqulred to comply with 

standards for waste pneralld at Service fadUtles. 

• Authorization of Appropriations: N I A 

Salmon ond SIHlhead and Conlenrallon ond Enhan...,.entActof1910,16U.S.C.330l,U·15,n-25, 

31-~41~. ThlsActallowsforimprovedmanagelnl!ftl and~~ planning to help prevent a 

further decline of salmon and steelhead stocb, and 

to assist In Increasing the supply of these stocb 

within the Columbia River cc.-v.tim uu and 

the W.uhlngton conservation areo. • Authorization of Appropriallons: N/ A 

Slk•Act.eaamtmded,.16 U.S.C.670a-6'10o.Aulho-

.rizes the Secrelaly of the Interior to cooperate with 

the Department of~. Dep4rtment ofEnerzy, 

National Aeronautics and Spac:e Administration. 

Bure&u of Land Management, and State agencies In 

planning. developing. 11\&lnlalning and rehabWtat· 

lng Federal lands for the benefit of llsh and wildlife 

resources and their habitat. 

• Authorization of Appropriations: Expired September30,1993 

Surface Mlnlns Control and Rtclamalion Act of 

19'1'1, 30 U.S.C.12111oL "'I· Require the Secnlary 

of the Interior to ~te turf~ mining and reclabirds, other !Widell wlldUfe and llllptory birds 

ttueatenod by advene -!her condlllono or other 

facton destructive to wildlife- . 

• Authorization of Approprilllonl: N/ A . 

Tnu1UJ,PootaiS1191ceandGenenlGoY...-t 

Appn>priall- Bill lor flocal Yar1991· Pay Act 

PlrbUc Law 101·509. Establishes 11\andatory ~ 

znent age for law enforoemont olficen, increued 

uniform allowanca, aet overtillle rates and •pedal 

rates for law enforcerwU ofllcers, and establishes 

pay differentials for law enforoemont officers In 

oelected dties. 

• Authorization of Appropriations: N/ A 

WatHRtooarcooD.vtloplllmiActof1976,90StaL 

2921. Authorizes the l..owt'rSnab RlverCompensa· 

tlon Plan to rnitlpte "' fish and wildlife ....... 

caused by power pneratim features at four Corps 

of Engineen dams .., the l..owt'r Snake River In 

W.uhlngton. 

• Authorization of Appropriations: N/ A 

WaiHihedProtoctionondFloodPn..mtionAct,16 

U.S.C. 1001·1009. Provides lor notillcallon of the 

Secrelalyof the Interior by the Secnlary ol Agrlculhlnt wtwn fumlshlng assistance to local organiza· 

11ono under provisions of the Watershed Prollecllm 

and Flood Pnventian AcL 

• Authorization of Appropdallons: N I A .. 

Wild Bini Conoernticm Act of 1992, P.L 102-4f0. 

ProlllolleStheconservatlonofexolicblnlsbyenmuraglngwllc! bird conservation and rnonagement progr&II\S In countries of origin. by ensuring that Ill 

trade In tudlspecles Involving the United Slates Is 

bloJoglcally tuttalnable and to the benefit of the 

species; bv llmltlr\g or l'f"Nhhling Jmports of exotic 

blnls when necessary ., ensure that e.<otlc wild 

populallcns are not harmed by removal for the 

trade. 

• Authorization of Approprialions: Expired Septerni>er 30, 1995 
224 

Myths o(Jobs vs. Resources: 

ENVIRONMENTAL 

PROTECTIONS AND 

ECONOMIC GROWTH 

California Senate Office of Research 

~hl996 . 

847-S 
~~ 

,.n~ 

CA&Jf'OIIINIA.!MIIof. 

tei81 .4S·M 71 

2:l&W KCCHO STMET. sum;_,.. HA'I'WI#I/0. CAUPOftNIA ··~1 

101~ ..00 

~:o~ ~~ CSIDI'l'.-o· :JeOO 

March 1996 

Dear COUeasuea: 

225 

C!!alifnmia &tatt ~tnatt 

BllllOCKYER PRESIDENT PRO TEMPORE 

TlNTH llNA TORIAL OISTAICT 

COUNTIES OF ALAMEDA AND SANTA ClARA 

I •

• 

We are pleased to provide you a new report &om the Senate Office of Research (SOR), "Myths of Jobs w. 

Reaources: Environmental Protections and Economic Growth." 

This significant study analyzes the economic impact of environmental laws and regulations on job growth in the 

United States and California, and asia the question: "Is there empirical evidence supporting the position that 

strong environmental laws are incompatible with strong economic pcrfonnance?" 

The report reviews economic data for the nation u a whole and separately for California. The study also 

examines the restructuring of the economy in the past twenty years to determine whether'losses in industrial 

employment are related to strict environmental resulation. Specifically, the impact of air pollution resulations 

and of spotted owl protections are reviewed to analyze their effect on local and statewide economies. 

Central to the report is a review of the work done by Dr. Stephen Meyer of the Musachusetts Institute of 

Technology Project on Environmental Politics and Policy which compared states beginnins in 1973 on the basis 

of the strength of their environmental laws and economic pcrfonnanees. In his original study and afterseveral 

follow-ups. Meyer wu able to ucertain that there is no relationship between strong envircinrnentallaws and 

weak economic growth. lnslead, he found the contrary to be true: that states with the strongest environmental 

laws tended to have the strongest economies. The single greatest indicator of poor growih in gross ~~~ate product 

wu found to be the degree of the states' dependence on resource-depleting industries. 

In reviewing California data, supplied by the Center for the Continuing Study of the California Economy, the 

SOR: report concludes that while California hu been shaken by a severe economic downturn since 1990, this 

rec:easion hu been caused principally by defense bue closures and cutbacks in both defense and civilian 

aeroapaee expenditures, and not by factors related to environmental regulations. 

We hope the findings in this report wiD offer you interesting. illuminating and useful information u you weigh 

decisions affecting state economic and environmental policies. 

~~~ Bn.Lu:;;;r 

Preaiilent pro Tempore 

California State Senate 
226 

Myths of Jobs vs. Resources: 

ENVIRONMENTAL PROTECTIONS 

AND ECONOMIC GROWTH 

Prepared by 

Alan Gordon 

California Senate Office of Research 

Elisabeth Kersten, Director 

March 1996 

Ediud by IWiftc:a LoVoUy and Forrn4lud by Ginny Daley 
227 

TABLE OF CONTENTS 

Executive Summary ........................................................................................ 1 

Introduction ...................................................................................................... 7 

Chapter I: The Impact of Environmental Protections on the 

National Economy .................................................................... !! 

Chart 1: Economy-Wide Studies of Jobs and the 

Environment .............................................................. 12 

Chart 2: Employer-Reported Reasons for Mass Layoffs, 

1987-90 ...................................................................... 14 

Chart 3: Salmon Fishing Industry, Offshore and Onshore 

Commercial Fishing Job Losses ............................... 25 

Chart 4: The Economic Impact of Commercial and 

Recreational Fishing in California, 1992 ................. 26 

Chart 5: Global Growth of Environmental Industry, 

1993-1998 .................................................................. 31 

Chart 6: Number of Environmental Jobs by State, 1993 ....... 32 

Chapter II: The California Economy ......................................................... 33 

Chart 7: Job Losses, Gains in U.S., California ....................... 34 

Chart 8: Employment Growth in California ........................... 35 

Chart 9: Comparison of Job Trends Between California 

and the U.S., 1990-1993 ............................................ 36 

Chart 10: Indicators of Job Loss, 1990-1993 ............................ 37 

Chart 11: California Manufacturing Jobs ................................. 39 

Chart 12: California Jobs by M~or Region, 1990-1993 ........... 39 

Chart 13: Changes in Air Quality, Jobs and Population 

in the South Coast Air Basin, 1964-1990 ................. 45 

Chart 14: Growth in Total Jobs, Loa Angeles Basin and 

United States, 1969-1990 ......................................... 46 

Chart 15: Percentage Growth in Total Jobs, 1969-1990 .......... 48 

Chart 16: Percentage Share ofTotal Jobs in Manufacturing _ 

by U.S. City, 1990 ..................................................... 49 

Chapter m: Comparilae Economic Perloraumces of States 

with 8~ or Weak Eavil'oameatal Law• ...... ,, ............ -151 

Chart 17: State Environmental Standinp ............................... 57 

Chart 18: State Characteristics Used for 

Statistical Control ..................................................... 58 
228 

Chapter IV: Conclusion ............................................................................... 61 

Appendix: Economic and Environmental Health Indicators 

Developed by Stephen Meyer of MIT for his 1992 Study, 

"Environmentalism and Prosperity: Testing the Environmental 

Impact Hypotheses" .................................................................... 63 
Jobs Versus the 

Environment 

Minimal lmpaet on 

Plant Closin•s 

229 

lllytiY of .Toh Vel'8ue Raourcea: 

B""'"'"""'ntal Prot...,...... Gild Beo......U.. Gror»lh 

Executive Summary 

The American economy for 25 years has been marked by a 

decline in worker well-being punctuated by a shift in jobs 

from industries to services. Higher-paying manufacturing 

jobs that once formed the backbone of the American 

middle claas have been evaporating - 3 million of them lost in 

15 years. 

Some U.S. firms, attracted to lower wages beyond the borders, 

are shifting production to lesser-developed countries, especially 

Mexico and Brazil. Where U.S. jobs have grown, they often have 

been rooted in the lower-paying service sector -- in clerical work, 

sales, or food processing, for instance. 

There is a common assumption that U.S. environmental 

regulations, which expanded as manufacturing declined, share a 

responsibility for these market shifts. Thirty-three percent of 

Americans believe environmental regulations will negatively 

impact their employment opportunities. Some may assume, for 

instance, that environmental protections prodded employers into 

closing down U.S. plants and/or seeking less-regulated 

workplaces elsewhere. 

However, a number of respected studies, including a multi-year 

data-collection survey by the U.S. Department of Labor, have 

found environmental regulations have had minimal impact on 

plant closings and job losses. The Labor Department survey, 

based on information supplied by employers, found just 0.1 

percent of mass layoffs were triggered by environmental 

-1-
230 

~tlul of.Toh• Vereu. R.eouron: 

Bnr>lnmmeratal Pro'-timu ond /lconomk Gro111tla 

U.S. Bu•inesses and 

Foreign Soil 

Environmental 

Rules Create Jobs 

protections - and those tended to be in highly polluting 

industries. The data suggest 40 times more job losses have 

re.sulted from ownership changes in leveraged buyouts and 

mergers than from controlling pollution. 

While anti-pollution regulations cbuld be among several factors 

that make certain locations unprofitable, evidence shows 

environmental protections by themselves are not substantial 

enough to cause the shutdown of an otherwise healthy plant. 

Nor do environmental rules appear to be propelling U.S. 

businesses to foreign soil. A 1992 study by economist Timothy 

Koechlin found that market size, wages, taxes, political 

stability, access to European markets and distance from the 

United States are the determining factors in decisions by U.S. 

firms to invest capital in other countries. Nearly 80 percent of 

U.S. manufacturing investments abroad in 1992 were made in 

other highly developed nations. The second-highest share of 

U.S. dollars went to Germany, home of the strictest pollution 

controls in the world. Much of the remaining 20 percent of U.S. 

capital invested elsewhere went to Mexico, with close proximity 

to the United States, and Brazil, with a large internal market of 

its own - supporting the finding that market size and location 

are prime factors in foreign investing. 

Rather than dooming domestic employment, environmental 

protections spawn their own jobs, focused heavily in blue-collar 

work. They create manufacturing, transportation, communications and utility employment. Eighty-nine percent of these 

environmental jobs are in the private sector. At worst, research 

suggests, the role environmental protections play in 

manufacturing job losses has been insignificant. 

Controversies over the protection of endangered species seem to 

epitomize the entire debate. The number of listed endangered 

species is currently around 800 with thousands of candidates 

awaiting listing. Negative effects of environmental laws should 

be easily measurable as anecdotal accounts of negative economic 

impacts are widespread. However, this has not proven to be the 

case when studied. The data show that endangered species 

listings have not depressed economic development activity as 

measured by growth in construction employment and gross state 

products from the inception of the federal Endangered Species 

-2-
Exploring the 

Spotted Owl 

Controversy 

Shifting Timber 

Jobs to the South 

231 

Jlytlu of Job• v~ ...... Re.,..,.., BAvlro~~~~~entGl Proteellone OIUllkonomle Grout/a 

Act in 1975 through 1990, the last year for which complete data 

are available. 

Nowhare has the controversy that pits jobs against resources 

exploded with more force than over the spotted owl protections 

in the old-growth national forests of the Pacific Northwest. An 

estimated 15,000 to 30,000 job losses can be blamed on limits on 

the harvest · of old-growth timber required by the federal 

Endangered Species Act. 

But data suggest market forces play an even greater role in 

paring back jobs in the wood-products industry. Productivity 

gains and sustainable-yield practices •• necessacy to ensure an 

adequate supply of harvestable timber into the future •· already 

had doomed or eliminated thousands of wood-products jobs 

when the spotted owl protections became law in 1990. 

From 1980 through 1988, finished timber output rose 19 

percent, but automation and other productivity improvements 

during those years cost nearly 14,000 jobs. Reacting to the 

heavy pace of the harvest dUring the 1980s, and a need to 

sustain timber growth, the U.S. Forest Service drafted 

management plans that threatened at least half as many jobs as 

the spotted owl protections themselves. Then, in the 1990s, 

residential construction nose-dived, shrinking demand for wood 

products and spurring the layoff of 20,000 industry workers. 

Interestingly, as timber-harvesting capacity tightened in the 

Northwest, it mushroomed in the South. While capacity 

dropped by 34 percent in the Northwest between 1978 and 1990, 

it climbed 121 percent in the southern stntes. Meanwhile, 

Oregon in the last year has added 100,000 jobs •· 20 percent of 

them in the high-technology industry, which has surpassed 

timber as the state's leading employer. Even as the number of 

timber jobs declined in Oregon, the average wage rose. Yet 

Oregon remains the nation's timber basket, five years after 

spotted owl protections. This is partly because timber mills 

have retooled wood-processing procedures to accommodate 

smaller logs more efficiently. Since Januacy of 1993, Oregon 

and Washington have added about 4,600 jobs in the forestproducts industry, according to Washington state employment 

economists. 

-3-
232 

MyiM of.Toba Veraru Raourcea: 

llrtplroiUIWftlal ~ami Bconomk Growth 

For these reasons, overall, the economic impacts of the spotted 

owl protections appear to be neutral despite the harm they may 

pose to some timber communities. In weighing their overall 

effects, it must be remembered that Oregon fisheries, which 

spawn tens ofthousands of jobs, also rely on management of the 

timber harvest to protect fish habitats. 

Net Job Increases On balance, available studies indicate environmental protection 

spending has led to a small net increase in jobs in the U.S. 

economy. Job losses as a result of resources conservation can be 

subtracted from job gains that result from environmental 

technologies and services. 

Germ&Dy a Leading 

Exporter of 

Environmental 

Expertise 

Those job gains are significant in their own right: The 

California Employment Development Department (EDD) reports 

California can expect 200,000 environmental workers by 1996. 

EDD expects environmental cleanup to become a $1 trillion 

business worldwide by the year 2000. Californians account for 

about 18 percent of the U.S. environmental industry work force; 

the state's share of the industry could jump from $19.3 billion in 

1992 to nearly $27 billion by 1997. 

Domestic companies have been exposed to stricter 

environmental regulations for longer periods than businesses in 

any other nation. In theory, this should offer lucrative 

opportunities for exporting environmental expertise to countries 

now eager for it. However, Germany is first in line. As much as 

70 percent of the air pollution control equipment sold in the 

United States is produced by foreign companies. Germany has 

surpaased the United States as the largest exporter of 

environmental products and services. 

While environmental spending has created jobs, it also has 

meant losses in other goods and services that, through 

regulation, are restricted or no longer available. Certain 

industries, for instance, are highly susceptible to regulatory 

costs. ·These include some pesticide manufacturers, chemical 

firms and lead processors. A 1990 RAND study estimated 

environmental regulations slowed economic growth by about 0.2 

percent per year between 1974 and 1985. However, the study 

did not measure job gains. 

-4-
233 

Mytld of Job• y..,..,.. Ruo .. ,..,.,.., 

Bnvlro,.,...ntal Protection. t:JIUl Bco110mlc GroUJth 

Overall, the numerous studies .in this area suggest the net 

impact of environmental protections on the U.S. economy is not 

significant. 

California's California's severe 1990-93 recession was in full swing even as 

Recession the rest of the nation began its recovery. VI-rule the country was 

adding 3 million jobs between 1991 and 1993, California lost 

another 450,000. However, the state remained competitive, 

attracting a record amount of venture capital in 1993 and again 

in the first quarter of 1994. 

The Los Angeles 

Basin 

Further, its job losses were not spread evenly across the state, 

but concentrated in Southern California -- particularly the Los 

Angeles basin, which absorbed 70 percent of them. This 

phenomenon strongly suggests specific factors, not a general 

deterioration, accounted for the state's lost employment. The 

deepest losses in the manufacturing sector were in aerospace, 

where more than 130,000 jobs disappeared between 1990 and 

1993 due primarily to national defense cuts. High-technology 

employment also fell heavily in California - by 11.6 percent -

but the workers who remained were more productive. In 1993, 

high-tech firms in the Silicon Valley reachen record sales and 

profits. . 

At first blush, a case might be made that the Los Angeles basin 

absorbed the brunt of the recession's job losses because its air 

pollution regulations are the most stringent in the nation. But 

the evidence does not bear out that theory. 

Strict controls were developed and implemented by the South 

Coast Air Quality Management District during the 1980s. But 

the Institute for Economic and Environmental Studies at 

California State University, Fullerton, in 1995 found the Los 

Angeles basin out-performed the nation in job growth by more in 

the 1980s than it had in the 1970s. 

Stationary-source polluters, such as large manufacturers, were 

the target of the brunt of the district's regulations. Yet 

manufacturing jobs grew by nearly 17 percent in the Los 

Angeles basin, even as they declined 4 percent nationally. 

How do states with strict environmental laws fare in 

competition with other states? The data suggests they fare well. 

An analysis by two university professors - Paul Templet of the 

-5-
llyl/u of.JolM v~ ... Raource.: ....,._,_niGl Protwc~Wlw Gad Bcoftomlc Groutla 

Louisiana State University Institute for Environmental Studies 

and Stephen Farber of the University of Pittsburgh Graduate 

School of Public and International Affairs - found states with 

strong environmental programs also ranked high in economic 

well-being. 

Stephen Meyer of the Massachusetts Institute of Technology, 

who scrutinized the environmental and economic health of 

states between 1973 and 1992, also found that states wit,h 

stronger environmental policies out-performed states with 

weaker policies on all economic measures. 

Conclusion Fears or assumptions are largely mythical that . government 

regulations to protect natural reaoun:es extract a toll in lost 

jobs. Numerous studies have failed to document correlations 

between regional, state and federal environmental protections 

and: 

• The U.S. economy's shift from manufacturing jobs to jobs in 

the service sector, 

• Overall losses in productivity, 

• Overall losses in construction jobs, 

• Declining gross state product, 

• Weak economic performance, 

• U.S. capital investments abroad, or 

• California's prolonged recession. 
235 

Jlytlu of Joln v ... ,.. Raourea: 

..........,_,.,.., Proleetloru aiNl.__le Gro""h 

Introduction 

Does the punnrit of environmental . quality hinder 

opportunities for economic growth and development? 

Are atates with stronger environmental standards 

deatined to lac economic:ally behind those with softer standards? 

With the downturn in the California economy in the 1990s these 

queatioDe have aurfaced at the center of numerous public policy 

debataa. When put in llimple terma, the query becomes, "MU8t we cbooee between johe and the anvironment?" 

Critica arpe that en'rinmmental regulationa can stifle economic 

pvwt.b. a vi- ahand by many workinc Americans. Thirtyt.bne percent of reapcmclenta in a 1990 opinion poll conducted by 

the Wall StrMt .1--w t.boucht it was likely or -hat likely 

their own jobe were threatened by environmental protectiona. 

Such Ceara Wuatrata an auumption that trad-fl'a betwesn 

economic aDd enviranmental health are regrettable facta of life. 

Tbia 8J'IUDI8Dt can beat be aummarized aa followa. Buaineaaea 

iDvat their limited capital producinr fOCICb and aervices aDd 

CODCIIIDitantly cnatiq jobs where they believe they can 

m•zlmiu profits. lodividual baaineNu increaae their profits by 

llll)IUIIIinc 118lu while minimimng operating upenaes and 

capital outlaya. Envirmmental ngulatory coata to clean t.ba eir, 

water, or laDd are atamal 8lQI8IIMI not part of the coats of 

procluction. Adding enviramDental protectiona increaaes 

~ 

procluction coats aDd raulta in bieber-priced producta, 

aalea and reclucinl profit&. Less 118lu mean 1888 

-7-
236 

Mytly of.Joba y..,..,. Raoureea: 

Brwlrolllnmll<d Prottdiolu and Bconomie Growth 

jobs. When regional economic conditions are considered, it is 

argued, plants, jobs, and pollution are exported to areas with 

lower environmental standards. Thus, the argument goes, 

environmental laws and regulations impose "nonproductive" 

costs on the economy, reducing economic growth and eliminating 

jobs. 

This argument is appealing in its simplicity. However, others 

would contend that this theory is, at best, incomplete. They 

point out that just because environmental impacts may be 

external to a particular firm does not mean that they are absent. 

It simply means that someone else, usually the taxpayer, will 

pick up the costs. Further, environmentalists would argue that 

conventional analysis ignores the broader benefits of 

environmental programs and policies and is incapable of 

measuring negative impacts caused by pollution, such as lost 

productivity from workers and increasing health care costs. 

Estimates, studies and debates have attempted to capture the 

bottom line on the relationship between a healthy environment 

and a healthy economy. Is it true that state economic growth is 

curtailed by increasingly strict environmental laws? If it is true 

that states with strong environmental standards are weaker 

economically than states with more lax environmental 

standards, the public policy debate focusing on deregulation is 

justified from a purely economic perspective. If, however, 

relative levels of environmental standards among the states are 

largely irrelevant to their economic condition, either because 

environmental policies have no systemic impact or their effects 

are overwhelmed by stronger influences, then the "jobs vs. 

environment" debate is a distraction that diverts energy, time 

and resources from the tangible problems aftlicting our nation 

and economy. 

If environmental laws and regulations have caused an erosion of 

economic strength in the United States and California in the 

past 30 years, economic indicators should reflect this fact. State 

economies should be less robust after enactment of strong 

environmental laws. We should find that states with the 

strictest environmental regulations suffer in comparison with 

other states and countries, and concomitantly, states with 

weaker laws and regulations show stronger economic 

performances and better future prospects. 

-8-
237 

Mytla. of .lobe Vera,.. Reaoun:ea: 

BnulroiiiiU!ntal Protectimaa and Economic Growtlt 

It is clear the U.S. economy has undergone significant structural 

changes in the past 25 years. Workplaces are transitioning to 

meet the needs of a post-industrial, information-driven economy. 

Many traditional jobs in steel and auto manufacturing, heavy 

equipment and aerospace are disappearing, all too often 

replaced with lower-wage, lower-benefit, service-sector 

employment. Expenditures for pollution abatement in the 

United States have grown steadily over the past two decades, 

both absolutely and as a percentage of gross national product 

(GNP), reaching between $94 billion and $125 billion (2.1 

percent of GNP) as estimated by the federal Environmental 

Protection Agency (EPA), in 1990. EPA estimates these costs 

will reach 2.6 percent of GNP by 2000. Opponents of 

environmental laws argue these laws are a significant causative 

factor in this shift from heavy industrial manufacturing to 

service-sector employment, with a resulting decrease in national 

living stande,rds. If environmental laws negatively impact 

economic growth, we would expect to find the following: 

• Significant investment in low-regulatory jurisdictions as 

industrial manufacturers seek to avoid added environmental 

costs; 

• A connection between strong environmental laws and a 

decline in living standards; 

• A connection between environmental laws and an overall 

decrease in manufacturing employment; 

• Nationwide job losses that are not mitigated by increases in 

environmental technology-baaed employment; 

• Jobs created as a result of environmental laws concentrated 

in low-paying, service-sector employment; 

• Weaker economic growth in states after they adopt stricter 

environmental laws; 

A connection between the prolonged recession and weak 

recovery in California and a burdensome regulatory 

environment; 

-9-
238 

llyi/M ofJobo Verwuo .Raou,.., 

Bru.,.,._,.,al ~,..,.. aNl.Boonomk o,..,.,,, 

• Depressed state economic development, as measured by 

coDBtruction employment and grou state product, resulting 

from numerous endangered species listings; 

• An overall lou of competitiveness in the south cout air buin 

resulting from the region's strictest-in-the-nation air 

pollution regulatioDB, and 

• A competitive economic advanta~ for states with 

comparatively weak environmental laws over states with 

strong environmental laws. 

This paper will: 

• Review the factors influencing the larger U.S. and world 

economies, Bll the overall impact of environniental lawe can 

only be understood within the context of structural economic 

changes occurring throughout tl\e global economy; 

• Analyze the California economy, ita strengths and 

weakneuea, 88 well 88 ita long-term potential; 

• Undertake a micro-economic review of the Los Angeles bBIIin 

and the impacte of pollution control laws on the economy of 

that region; · 

• Compare California'• environmental regulatiODB with those 

of other states in determining whether, at a statistical level, 

there is a correlation between etrong environmental 

reculatiODB and neptive eecmomic powth. 

-10-
U.S. Economy baa 

Undergone 

Fundamental 

Restructuring 

239 

~ o(.Toln Veraua ~,_., 

B...,inmmeniGl ,.,.,_,_ llltd Boo-'c Growth 

Chapter 1: 

The Impact of Environmental 

Protections on the National 

Economy 

C ongreas and a series of preside.ntial administrations have 

put numerous environmental protection laws and 

regulations on the books since the severity of health and 

ecological problems associated with air and water pollution tQpk 

hold of the national consciouaness beginning in the mid-1960s~. 

In ascertaining the economic impacts at the national and state 

levels of these actions, an accurate picture of the overall 

national economy during that period is essential. 

For nearly two decadea, the country ·has suffered from what 

economist Wallace Peterson calla a •ment depression.• The real 

weekly income of workers in 1990 was 19.1 percent below the 

level reached in 1973.' During the same period, average family 

income improved 0.04 percent a year, compared with 2.72 

percent annually over the 15 yean prior to 1973. This nearly 

invisible gain was achieved only because more women, including 

mothers and wivea, entered the labor force to boost household 

income. Therefore, the overall growth in GNP has masked a 

serious decline in well-being.1 

'Wallace Potenon, '"l'ho Silent Depreesion,• CMikTI(Ie, July-August 1991, pp. 

30-31. 

'Ibid. 

-11-
240 

Mytlu of Jobs y,.,...,. Reooun:ea: 

Bn11iro,.,...ntal Protec&no and Economic GrnUJth 

Impact of 

Environmental 

Lawson 

Manufacturing 

Jobs 

This decline in well--being has been marked by the 

disappearance of jobs in the industrial sector. Critics argue 

environmental protection mandates have accelerated the decline 

of U.S. manufacturing and the disappearance of millions of blue· 

collar jobs, driving the "silent depression" described by Peterson. 

Numerous studies have explored this issue. (See Chart 1.) This 

chart identifies each of the economy-wide studies, published in 

peer-reviewed journals, since 1978. The second column 

indicates whether the study found· a positive or negative 

economic impact. Note, that with the exception of the single 

1978 study, which will be discussed later, there is no empirical 

evidence found showing a negative correlation between 

environmental laws and economic strength. They show the U.S. 

economy is undergoing a restructuring, with many 

manufacturing jobs being exported to foreign countries. The 

jobs vs. environment debate has clearly been fueled by a 

significant drop in manufacturing employment - a process that 

has accelerated in the past 15 years. 

CHART I 

ECONOMY-WIDE STUDIES OF JOBS 

AND THE ENVIRONMENT' 

.. 

' '"'' • ~ t ,) '' •I I • ' 

·-· • .J ~. " ~·-· -~ :..!..! .!!. 

Haveman (1978) Positive 

Hollenbeck (1978) Ne~ative 

Data Resources Inc. (1979) Positive 

Data Resources Inc. (1981) Positive 

Muller (1981) Two positive 

One mixed.,. 

Wencflini and Bezdek (1989) Positive 

Meyer (1992 1993 1995) Positive 

• The author believes tJWo to be a complete lioting of economy-wide etudie• 

either published in peer-reviewed journals, published by the EPA, or 

resulting from aeadomic work. 

Positive short-run offeota, negative long-run effeota. 

In that time, the United States has lost more than 3 million 

manufacturing jobs, due in part to increased competition from 

First World nations and from the newly industrializing 

-12· 
241 

~IIY of ololn Vereru ~•ourcn: 

BnDironmenlal ProleeiiD,.. Gll<l Bconomk GroU>Ih 

countries of Brazil, Korea, Taiwan and others. Concomitantly, 

U.S. manufacturers began moving production "offshore," 

irivesting increasingly in manufacturing facilities in low-wage 

colintries such as Mexico. 

Jobs have been lost primarily from the previously high-paying 

manufacturing sector that had been the backbone of the bluecollar middle class since the Depression era of the 1930s. The 

disappearance of these jobs has contributed to a decline in 

average real wages since 1973 and to a shrinking middle class.' 

At the same time, many of the new jobs created during this 

period have been in lower-paying service-sector employment. 

Some assume environmental regulations have played a key role 

in this shift from manufacturing to service employment. Critics 

suggest expansive environmental protection measures have: 

• Led to the shutdown of manufacturing plants, 

• Encouraged the flight of U.S. manufacturing capital 

overseas, and 

• Reduced domestic investment in new jobs by hampering 

productivity growth. 

Much data has been collected to attempt to determine the 

reasons for this decline in American manufacturing. Since 1987, 

the Labor Department has compiled information on layoffs that 

have idled more than 50 workers. Seventy-five percent of firms 

in the civilian economy, covering 57 percent of the 

manufacturing work force, have been included in this survey. 

Employers are asked to list the primary cause of layoffs. The 

data for the years 1987 through 1990 are shown in Chart 2. 

The Labor Department survey leads to a conclusion that the 

impact of environmental laws and regulations on factoryshutdown decisions is minimal. On average, according to 

employers' estimates, environmental protection spending 

accounted for less than 0.1 percent of mass layoffs nationwide 

from 1987 through 1990, and these tended to occur in the more 

highly polluting industries such as chemical manufacturing and 

lead smelting. 

' Mishel, "The Late Great Debate on Deindustrialization," Challenge, 1989, 

Vol. 32, No. 1 pp. 36-44. 

-13-
CHART 2 

EMPLOYER-REPORTED REASONS FOR MASS L

.... 

'!'-

• JndudrtJ environmental and ufety-related shutdowll.il. 

Source: U.S. Department of L.ai.Jor, "Ma.es Layo1T11 in [various yean~i," Bu11etin (Bureau oi Labor Sta.ti11tic.), 2310
Environmental 

Laws and 

Disinvestment 

243 

M:ytm of.Toba Ve,..,.. Reaou,..,.,a: 

EnPlronJIIU!ntol ProtectUma Gild Economic GroU1tla 

Four plants per. year, out of more than 2,500 closed annually, 

were found to have closed primarily because of environmental or 

safety problems during the years cited. 

The numbers can be doubled to roughly account for the 

remainder of manufacturing layoffs that were not included in 

the survey. This leads to an average figure of 1,300 jobs lost per 

year. -As a comparison, 40 times more jobs were lost as a result 

of ownership changes in leveraged buyouts and mergers.' 

For instance, IBM permanently laid off 18,000 workers in a 

single year, 1990, to contain costs in the face of heavy 

competition. This was nearly four times the total linked in the 

Labor Department survey to environmental protections over a 

span of four years ending with 1990. 

The data indicate environmental protection expenses alone are 

not substantial enough to cause the shutdown of an otherwise 

healthy plant. Anti-pollution regulations, however, could rank 

among several factors in making production at certain locations 

unprofitable. 

Another common assumption is that manufacturers are shifting 

their investment capital to Third World nations to avoid 

stringent pollution regulations, thus hampering the creation of 

industrial manufacturing jobs in the United States. 

Studies conducted to date do not support this assumption. The · 

effect on investment decisions of environmental protection costs, 

according to the best data available, would appear negligible. 

Pollution control costs range in the vicinity of 1 percent to 2 

percent of business expenses. A 1992 study by economist 

Timothy Koechlin' identified the primary determinants of U.S. 

' It has been argued that opinion evidence of the type used by tho 

Department of Labor is inherently unreliable. For instance, in the above 

data, several categories listed separately, such as bankruptcy, contract 

cancellation, import competition, material shortages, and overseas relocation, 

could have been caused by comparatively higher product costs due to 

environmental regulation, even though this category was separately listed. 

Balancing this fact, however, is tba fact that the annual figure of 1,300 comes 

from information supplied by employers. lfsome employers were opposed to 

environmental restrictions, they might have had an incentive to link their 

layoffs to those restrictions in reporting them to the Labor Department. 

' Timothy Koechlin, "Determinants of the Location of USA Foreign 

Investment," International Review of Applied Economics, 1992, Vol. 6, No. 2, 

pp. 203-216. 

-15-
M:/llu of.loh y..,..,.. Rnourea: 

BnolnmmentGll'rohetiDIY and Beonomie GroUJIIa 

investment abroad, in order of importance, as a country's 

market size, wages, tax rates, political stability, its access to the 

European market and its distance from the United States. 

Also, a look at the destination of U.S. investment capital does 

not support any claim that manufacturers are disinvesting in 

the United States and moving to !ow-regulation venues. 

At the beginning of 1992, 79 percent of all U.S. manufacturing 

investment abroad occurred in other highly developed nations, 

rather than in less-developed countries. The United Kingdom, 

Canada, Germany, and Switzerland, all highly developed 

nations with advanced industrial economies, received the largest 

dollar amounts of U.S. foreign investment. Germany, the 

country with the third-highest share of U.S. investment dollars, 

was also the country with the strictest pollution control 

regulations, as measured by the percentage GNP devoted to 

environmental protection. ' 

Much of the remaining 21 percent of U.S. investment dollars 

went to Mexico and Brazil. Mexico is close to the United States 

geographically, while Brazil has a large internal market of its 

own.' This is consistent with Koechlin's research showing 

market availability and location as primary determinants in 

investment decisions. 

Is there proof indicating that industries are relocating to nations 

with less stringent environmental policies to minimize 

compliance costs? Empirical studies refute this hypothesis. 

Studies done at Cambridge University, the University of 

Maryland, and at Harvard University also found little or no 

evidence that pollution control measures have exerted any 

systematic effect on international trade.' 

'Ibid. 

' Ruaael B. Scholl, Raymond J. Mataloni, Jr., and Steve D. Bezerganian, '"l'he 

International Investment Position of the United States in 1991." Survey of 

Curnnl BruiMU, 1992, Vol. 72, No. 6 pp. 46-59. 

• H.J. Leonard: Pollution and the Struule for World Product, Cambridge 

England: Cambridge Univenity Presa, 1988. 

J.A. Tobey, '"l'he Elfecto of Domeztic Environmantal Policies on Patterns of 

World Trade: An Empirical Test," KYKLOS 43, No.2, 1980; pp.191 209. 

M.E. Porter, The Competitive Advantage of Nationa, New York: The Free 

Presa, 1990, pp. 728-729. 

Bezdek, Roger H. Environment, Vol. 35, No. 7,p. 6 Sept 1993. 

-16-
Environmental 

Jobs are 

Concentrated in 

Blue-Collar Sectors 

245 

Mytlu of.Toba v,.,..,.. Reaou,..,.,a: 

Bnolro,.,..,ntol Proteetiona and Bconomle GromtA 

The seniinal work done by Professor M.E. Porter at Harvard 

went even farther. Porter's study showed that not only did 

environmental protection costs not hinder the comparative 

advantage of heavily regulated nations, to the contrary, those 

nations with the strictest environmental laws also had the 

highest rates of economic growth and job creation. ' 

' 

Finally, Maureen Cropper and Wallace Oates of the University 

of Maryland did an extensive literary review for Resources for 

the Future in Washington D.C., and found that as of June of 

1992, "domestic environmental policies, at least to this point in 

time, do not appear to have had significant effects on patterns of 

international trade. • 10 

What types of jobs are created by environmental protection 

spending? Statistical analysis shows environmental protection 

provides employment heavily weighted to the traditional bluecollar manufacturing, transportation, communication, and 

utility sectors. These sectors represented 22 percent of non-farm 

jobs in 1991, but accounted for a sizable 57 percent of 

employment generated by environmental protection spending." 

These include jobs in recycling bottles, cans, and other materials 

as well as the manufacture of pollution abatement equipment 

and alternative energy components. 

Are environmental jobs primarily in the public sector, financed 

by taxpayers? The answer is no - 89 percent are in the private 

sector. An 11 percent rate of environmental protection 

employment in the public sector compares .to 17 percent 

throughout the U.S. economy.11 

While it is true the United States is going through a period of 

economic restructuring, and dwindling percentages of the work 

force are engaged in traditional manufacturing-based 

employment, the data suggests environmental protection costs 

are, at most, an insignificant factor in this trend. 

'M.E. Porter, "Ameriea's Green Strategy," Sc~ntific American, April1991, p. 

168. 

" M.L. Croppsr and W.E. Oatea, "Environmental Economics: A Survey," 

Jou17111l of Economic LitertJtun, 30, June 1992, p. 699. 

" Rogsr H. Bezdek, "Environment and Economy: What's the Bottom Line?" 

Envirtmmcnt, 1993, Vol.36, No.7, pp. 7-32. 

"Ibid. 

-17-
246 

M:fiM of.lolH v.....,. s-ure..: ~,..,.._,_......,~ GroUtiA 

Job Louea m Critics complain that job growth ia curtailed when natural 

~ve retiOUI'CIIII are "loclted up• in national parka or protec:ted 

Jndutriea ecoayatema, such aa the formidable environa of the desert 

tortoise or the old-growth forests of the northern spotted owl. 

Do laws protecting reso\m:es and ec:oaystems result in a national 

net loss of jobs in specific categorie•? 

Dr. Stephen Meyer, director of the Project on Environmental 

Politics and Policy at the Maaaachusette Inatitute of Technology, 

haa studied thia question at length. Meyer aought to determine 

if there . were observable and IIUbstantial negative economic 

effects from Endangered Species Act (ESA) liatinp. Meyer 

hypothesized that with the ESA currently liating nearly 800 

species, and with thoUII&Dds of candidate species pollllibly 

eligible in the near future, impacte on state economic 

development ahould be apparent. 

In hia March 1996 paper, -Em:lanpred Species Listings and 

State Economic Performance;" Meyer estimates the impact of 

IIDdanfered speciesliatinp on state economic development from 

1975 to 1990, the period for whiCh complete data are available. 

The study focused on two indicatore of state ecoaomic 

performance that reflect development activity: ccmstruction 

employment and powth in pou state product. Ccmatruction · 

employment ia c:hMen because, -u" the weipt of endanpred 

species liatiDp ia aystematic.lly hiDderiDc development 

activity, for eu.mple, forc:iq delaya · and cancellation of public 

worb projects and spa'llrDin( permit denials for J'811idantial and 

commercial c:onatruct.icm, then COIUitructioD employment 

opportunities should be limited if DOt actually clepreased .... 

Furtlmmore, if ESA liatiDp ..,.. u devaatatiaa to local 

--ue. u the aMCdotal m~ milbt impl;y, tben states 

with hiP ~~--- of endaJipred apec:iu ebould au&r 

economically in a mauurable way. Thia JaePtive impact would 

be detectable throuch chaDpa in the IJ'CIU state prOduct. 

N- of the data studi.d aupport the .-tiCID that eodaDpnd 

apecies protectiOD resulted ill meaaunble reductiODa ill 

......... II. ...,., 1117' l'roi«< - .,..........., l'olllla allll l'rlllc7. 

lbrda1181 . .. ...,_,p.2. 

-18-
247 

llytm of.Joba Vereu. ~­

Bm>b'O,_ntol ,.,..,_,_. and llcorMHnl<: Grouttla 

c:onatruction employment growth during the time periods 

studied. If ESA listings are negatively impacting state 

economies there is no sign of that impact in the area of 

conairuction employment. 

In comparing changes in groas state product with ESA listings, 

the pattern predicted by ESA critics again was not apparent in 

the Meyer study. 'There is no trend of declining economic 

performance as species listings increaae,"11 Meyer found. 

Instead, modest rate increases in gross state product were 

observed. 

There is another possibility that Meyer's initial study did not 

take into account. If states with higher numbers of endangered 

species listings are also states with underlying strong 

economies, the . ESA could be retarding the rate of increase in 

state . economic growth. If this were true, then it could be 

argued, the findings from 1975 to 1990 are irrelevant, because 

these states might have performed even better had they had 

fewer species listings. 

The impact ofthe_ESA should be evident when comparing each 

state's growth rate during periods precedent and subsequent . . If 

larger numbers of listings decelerate economic growth, as might 

be suggested, then comparisons of the periods 1975 to 1980, 

1980 to 1985, and 1985 to 1990 would show a tendency toward 

slower growth in states with burgeoning ESA lists relative to 

states with fewer ESA listings. 

This hypothesis also was tested by Meyer. In fact, contrary to 

the hypothesis, as states accumulate species listings their 

economic growth rates do not decelerate; in fact they seem to 

accelerate. 'The beat predictor of a slowing economy is 

dependence on extractive industries,"" Meyer found. This also 

proves true for construction employment. The data could not 

support any conclusion that states that had accumulated higher 

numbers of listed species over time would have ~oyed stronger 

economic growth had ESA protections not been implemented. 

Meyer concludes: The d4ta show that enda.ngered species listings 

have Mt depressed llt4U economic tkuelopment actiuity 1111 

metUured by growth in construction employment and gross state 

"Meyer.,p.S 

.. Meyer, p . 9. 

-19-
248 

Mytlu of .Job• v.,,..,.. Rftource.: 

BnJJironmental Proteetiom G1Ul Bconomk Gro~t~tla 

area, population, population density, siu of ecoTUJmy, structure of 

economy, population growth, and time." 

Does this study hold in individual cases such as the spotted owl 

controversy, where massive job losses were predicted when the 

bird was first proposed for listing? The fact is, significant job 

lo118e11 in the wood-products. industry that affected timber 

communities across the Pacific Northwest likely would have 

occurred even without the controversial spotted owl protections 

triggered by the federal Endangered Species Act. 

These "lock up" protections of the owl's habitat reduced the 

number of board feet of old-growth timber harvested in national 

forests. Estimates, based on late 1980s data, of direct and 

indirect job losses from old-growth protections range from 

around 15,000 to 30,000, total, depending on the severity of the 

timber restrictions and other underlying assumptions." 

But available data indicate that sustainable-yield forest 

practices, increased productivity, macro-economic forces driving 

the residential housing market, and regional production shifts 

exert a greater force on jobs in the timber industry than do 

environmental laws &lld regulations. 

Opponents of the Endangered Species Act argue that, but for 

environmental restrictions, jobs in the wood-products industry 

would have been largely preserved. Some politicians predicted 

an epidemic of bank foreclosures and a severe recession, if not 

an actual depression, as a result of the spotted owl protections. 

Michael Burrill, speaking for many fellow mill owners, stated, 

"They just created Appalachia in the Northwest." U.S. 

Representative Bob Smith, from Eastern Oregon, said the 

logging restrictions "will take us to the bottom of a black hole." 

But studies conclusively show that increased productivity in the 

timber industry during the 1980s, coupled with sustainableyield practices nece88ary to ensure an adequate supply of 

harvestable timber into the future, already had doomed 

thousands of wood-products jobs when the owl protections 

became law in 1990. 

"Meyer, p. 1. 

" Roes W. Oorte, "Economic Impacta of Protecting Spotted Owla: A 

Comparieon and Analym of Emting Studiee," &port for Congre., 92·922 

ENR, Congreaaional Research Service, Wuhington, D.C., 1992. 

-20-
249 

llyllt. of .loin y.,,..,.. Ruoul"'>ft! 

Bnoironmentol Profeelioru Gad Bconomle Gro111tA 

While timber profits were higher prior to the spotted owl 

protections, robust harvesting levels of the 1980s were widely 

recognized as non-sustainable from an industrial perspective. 

Regulations to lower the harvest rates were needed to ward off 

depletion of federal timber reliources,,. regardless of whether 

additional actions were taken to protect the owl. The U.S. 

Forest Service drafted new forest-management rules that 

dramatically reduced the number of board feet cut on federal 

land. A report based on six separate employment studies"' 

concluded the new management plana would have employment 

impacts ranging from approximately half as large to as large as 

spotted owl protection itself. 

Moreover, the number of workers required to produce each 

board foot of timber had dropped in recent years, significantly 

boosting productivity in the highly competitive wood-products 

industry. From 1980 through 1988, during a period in which 

finished timber output grew by 19.2 percent, automation and 

productivity advances eliminated over 13,800 jobs in the 

industry. 

According to a 1991 study,11 if current productivity gains 

continue, productivity-induced direct employment losses will 

total in excess of 33,500 by 2010, roughly three times the 

number of direct jobs likely to be lost as a result of old-growth 

protection for the northern spotted owl. 

Furthermore, many lost timber jobs have been related to the 

general slowdown in the economy. From 1990 to 1992, 20,000 

workers were laid off in the industry. This cyclical 

unemployment, resulting from decreases in residential 

construction, is a permanent byproduct of resource-dependent 

industries. How much of this job loss is permanent is not yet 

clear. 

ln the past five years, Oregon has lost about 14,000 jobs in 

forest products, and Washington about 6,300, according to the 

Washington State Employment Security Department. However, 

~ Michael AndenoD and Jeffrey T. Olson, "Federal Foresta and the Economic 

Base of the Pacific Northweet,• Wildemeea Society, Wubington D.C., 1991. 

• V. Alaric Sample and Dennis C. LeMaster, "Assessing the Employment 

Impacts of Propooed Measures to Protect the Northern Spotted Owl," Forest 

Policy Center, Wubington D.C., 1992 . 

.. Op. Cit. 

-21-
250 

M:yllae o(Jobe Vereue Raouru.: 

B11fJiro11111enlal Protectlo~~e Gild Economic GroUitla 

other studies indicate that by the year 2040 about half of these 

jobs, and the old-growth forests they depend on, would be gone 

without adequate timber-cutting restrictions. 12 

Furthermore, timber production has shifted to the southern 

United States. As a result of restrictions in the Northwest, 

Anderson and Olson report, the nation's seven largest lumber 

and plywood manufacturers reduced capacity in the Northwest 

by 34 percent from 1978 to 1990 while increeaing capacity in the 

South by 121 percent. There are clearly pockets of poverty in 

areas of the Northwest, especially in ·the smaller, more remote 

timber towns of Oregon, Washington, and California. But 

economic studies in Oregon show no county has an 

unemployment rate higher than 7.8 percent. 

In Oregon, the nation's top timber-production state, recent 

studies have surprised many. Four years into a dramatic 

curtailment oflogging in the federal forests, the state has posted 

its lowest unemployment rate in a generation - just over 5 

percent, compared to a national rate of5.9 percent. 

Economists consider this full employment - a low jobless rate 

that still is significant enough to avoid the inflation induced by 

a shortage of labor. In the last year alone, the Oregon economy 

has added nearly 100,000 jobs. Interestingly, this is precisely 

the number of jobs that outspoken critics had claimed would be 

lost to owl-protection regulations. Twenty-thousand of these 

jobs have been in high-technology fields, with companies such as 

Hewlett-Packard and Sony opening and expanding plants in the 

state. In 1995, for the first time in Oregon history, high 

technology will surpass timber as the leading source of jobs in 

the state. 

Moreover, as the number of logging jobs has fallen, the average 

relative wage has risen. In the peak year for timber cutting, 

1988, wage levels in Oregon were 88 percent of the national 

average. In 1994 they were 94 percent. 

Oregon is still the nation's timber basket, five years after 

spotted owl protections were instituted. Mills are using smaller 

trees, grown on private tree farms, and getting more use from 

the timber by processing previously discarded materials. A 

Springfield, Oregon, mill that had closed in 1989 because it 

"Op. Cit. 

-22-
Impacts on the 

Fishing Industry 

251 

MytiY of .lobe Vereue Raou,..,ea: 

Bnr>ironmental Protecllo,.. and Economic GroUJth 

could no longer buy large trees was recently retooled to process 

small-dimension wood from tree farms. The mill now employs 

450 people." Oregon and Washington combined added about 

4,600 jobs in the forest-products industry between January 1993 

and January 1995, according to the Washington and Oregon 

Employment Development Departments. 

As Oregon has lessened its reliance on timber manufacturing it 

has become more appealing to high-technology manufacturing, 

mitigating net job losses. Despite a negative impact on some 

timber-dependent communities, the overall results show a 

neutral economic impact, at worst. 

This is not meant to downplay the extent of impact in those 

communities where timber job losses have been most severe, but 

rather to indicate that economy-wide, Oregon has done well. 

Loggers and mill workers will most likely not fill the high-tech 

jobs, and appropriate programs are clearly necessary to deal 

with their long-term survival. 

Timber-harvesting practices are a mlijor contributor to riverine 

habitat damage both on and off national forest lands." 

Consequently, an accurate assessment of the overall economic 

impacts of changing harvest levels should include effects on the 

fishing industry, an important sector of the Northwest economy. 

At least 106 m!ijor populations of salmon and steelhead on the 

West Coast have been driven extinct, and over 214 native 

salmonid stocks risk extinction in the Northwest, according to 

the American Fisheries Society." 

Causes of these extinctions are cumulative, but the loss of 

riverine habitat is among the primary factors.'" Although the 

numbers of salmon caught each year peaked a century ago, the 

commercial salmon harvest is still large and the fish-processing 

a Timothy Egan, "Oregon, Foiling Forecasters, Thrives as it Protects Owls," 

N.Y.Timea, Tuesday, October 11, 1994. 

"J. R. Sedell and F. H. Everest, 1991. 

• W. Nehlaen, J.E. Williams and J.A. Lichatowich, "Pacific Salmon at the 

Cro88r0ads: Stocks at Risk from California, Oregon, Idaho, and W a.shington 

Fiaheriea," 1991, 16(2):4-21. 

• "Historic Changes in Pool Habitat for Columbia Basin Salmon under Study 

for TES Limng," Pacific Northweat Research Station, USDA Forest Service, 

Corvallia, OR. 

-23-
252 

~ofJol» v.,,......a-.,,..,_ ...,__,.,.., ~ GIMI&-io Groull& 

industry is still important. Fishermen, their suppliers, 

proceasors, distributors and marketers depend on the 

commercial catch for their jobs and income. 

The Pacific Rivers Council in 1992 identified 15,000 jobs in the 

Pacific Northwest that were dependent on the commercial 

salmon fishery alone in 1988." Of these, 4,450 were in Oregon, 

6,800 in Washington, and 4,000 in California. All 15,000 of 

these jobs would be threatened if the federal government 

canceled the salmon season due to non-sustainable fish 

populatjons. 

Total job losses in commercial fishing in California from all 

fisheries are represented in Chart 3. While habitat degradation 

is not the sole reason for these job losses, all available studies 

indicate it is a significant causative factor. 

The recreational fishing industry, a prime tourist attraction and 

source of economic growth, also is threatened by riverine habitat 

destruction from non-sustainable forestry practices. 

A number of studies have addressed spending by recreational 

anglers and their resulting economic impacts. Only one of them, 

the "1985 National Survey of Fishing, Hunting, and WildlifeAssociated Recreation," by the U.S. Fish and Wildlife Service, 

covers the entire Pacific Northwest. It reports that trip-related 

expenditures on fishing by anglers in 1985 totaled $322.4 

million in Washington, $226.6 million in Oregon, $106.8 million 

in Idaho, and $1.235 billion in California. 

" The Economic Imperative of Protecting Riverine Habitat in the Pacific 

Northwest, Pacific Rivero Council Inc., Research Report, Nov.· Jan., 1992. 

-24-
., 

... 

~ 0 

ll 

... 

e 

i 

60,000 

50,000 

40,000 

30,000 

20,000 

10,000 

0 

253 

Mytho of Jobs VeraUB Resou""'s: 

Environmental Prolectiol&B and Economic Growth 

CHARTS 

SALMON FISHING INDUSTRY 

OFFSHORE AND ONSHORE COMMERCIAL FISHING JOB LOSSES• 

18'18 19'19 11180 1991 1982 1983. 191H 11186 111118 1118'1 1888 1888 1- 1991 111111 

Years 

Source: Pacific Fisheries MariDe Council (PFMC) 1992 Ocean Salmon Fisheries Report 

•Based on PFMC job-to-vessel multiplet of 1.61or oft'1hore aDd 8 Cor onabore 

-25-

24-936 96-9 
254 

Mytll. of Job• v.,,..,.. Raoun'""' Bllvlro~UrWrotol ProkctUm. <md &ollOink Gro.,th 

CHART4 

TIIB ECONOMIC IMPACT OF COMMERCIAL AND 

RECREATIONAL FISHING IN CALIFORNIA, 1992 

~~a~ .. - Procluelloa 

~ 

A Pem.w Value 

lacoale Added(t Nwabor Iacl....., (f alllloa) (f allll--) Bmplo,ed 

mllll-l 

Commen:iaJ I 731 I 701 I 770 20820 

Rec:reat.ioDal• 2 881 4998 6747 163 849 

-..,..,dAlcobol 411 718 ... IS.s?O 

a.taa.n.ata 1U 

- I'll 1.1187 

Lodarlalr 110 

- - 1711 

Tl'aluaortatiou 391 ... 167 1&012 

BaWDIDOD~ Ill l..IS4 Ull 48.401 

BoatPuro-AUoe 888 Ml 161 18.386 

BeereatloDAI Vehlel••• 671 847 

- 11137 

R6oreadoaal S.ntcee••• Ill I'll 401 12 0118 

Othor • 10 11 247 

Tolal P'iabhoa: I 3612 I 6899 I 6617 I 174 669 

CAIJFORIIL\ TOI'AL N/A 1822 788 • 804357 I 328.618 

CA ~ u PoroeDiop of 

Naliol>al Tolal NIA 0.88" 0.81" 1.27" 

Recreation values for 1986 were adjusted for in11ation to their 1991 

equivalent, aaauming oimilar recreational fishing spending in 1992 and 

1996. 

Recreational vehicles include travel, tant, or boat trailers, motor homes, 

pickupa, campers or vans, trail bikes, dune buggies, and four-wheel-drive 

vehicles. 

••• Recreational services include guide, pack and package fees, public and 

private land use fees, equipment rental, and dues and contributions to 

organir.ations. 

Sources: Pacific Fisheries Marine Council calculations; California 

Department of Finance and California Statistical Abstract provided 

"California Total" personal income and employment figures and the base 

values !rout which the impacts were aaaeosed. 

Pacific Northwest commercial and recreational salmonid 

fisheries have an estimated economic impact of over $1 billion a 

year, according to the Pacific Rivers Council.'" Without forest 

• Economic Imperative of Protecting Riverine Habitat in the Pacific 

Northwe.t, supra. 

-26-
255 

Jlylm of Job. v~ ...... Rno..,..,.,a: 

Environmental ProtectioJU ond Eeonomic Gro111th 

protections and habitat restoration, these jobs are at risk. The 

impact of all commercial and recreational fishing combined is 

represented in Chart 4, which shows over 174,000 jobs directly 

related to fishing activities. 

The Pacific Rivers Council report concludes: 

Dramatic protection must be implemented on public land ... if 

extinctions are to be prevented and if the seed stock for future 

economic impact is to be preserved. It is not enough to protect the 

habitat that is still intact. Lost habitat must be restored. 

Watersheds of good recovery potential must be identified and 

forest management mandates that protect and restore the critical 

ecological functions must be established. Significant changes in 

forest land management will be the critical underpinning of each 

habitat recovery plan, including reforestation and bans on 

harvesting near ecologically significant streams, on steep slopes, 

in alluvial areas and floodplains. 

Thus, the fact that fishing industry jobs may be saved or 

restored as a result of restricting timber harvests is a mitigating 

factor in determining the overall economic impacts of those 

environmental protections. 

Environmental- On balance, the available studies indicate that environruental 

Protection Jobs protection spending has led to a small net increase in the 

number of jobs in the U.S. economy. Job losses as a result of 

resource conservation can be subtracted from the job gains that 

result from environmental-technology products and services. 

Developing nations often need the kinds of products and services 

designed to meet environmental protection mandates in the 

United States. In addition, many international lending and 

development institutions require environmental controls, such 

as instrumentation and monitoring equipment, before they will 

consider projects for funding. Forty-eight percent of the World 

Bank's 1990 project loans required environmental components•• 

For example, Thailand decided to install scrubbers on its coalfired power plants after a single episode of air pollution sent 

more than 4,000 of its citizens to doctors and hospitals. Smogbound Mexico City is turning to emission controls on its cars and 

" United States Department of Commerce, 1994. 

-27-
256 

Mytlo. of olo6• v.,,..,.. Ruo,.,..,_, 

BlWironm..nlol Protectton. Gllll J~nomic GroUJth 

factories. Taiwan is req~ catalytic converters on 

motorcycle,s. 

Such mar1dates will almost excltisively benefit Germany 

because, an Harvard Business School economist Michael Porter 

explains, ''Germany has had perhaps the world's tightest 

regulations in stationary air pollution control, and German 

companies appear to hold a wide lead in patenting and exporting 

air-pollution reduction and other environmental technologies. • 

In the United States, environmental standards were relaxed 

significantly during the Reagan and. Bush years, often in the 

name of competitiveness. As a result, as much as 70 percent of 

the air-pollution control equipment sold domestically is 

produced by foreign companies." 

In Germany, a passion for environmental protection was fueled 

initially in the 1970s and early 1980s by reports of waldsterben, 

or "forest death" -- the widespread damage to the country's 

forests caused by air pollution. Germany's environmental 

consciousn<!SS has led to numerous programmatic and 

technological advances. Already running a close race with the 

United States as the world's leading exporter of merchandise, 

Germany i11 convinced its environmental regulations, easily the 

world's mont stringent, will stimulate the development of a wide 

range of new "green" technologies that can be marketed globally 

just as demand for them is beginning to increase sharply. (See 

Chart5.) 

The cumulative effect of the German pollution-reduction effort is 

to place Gtlrmany in a commanding position, as nations beset 

with environmental problems search for ways to reduce 

pollution quickly and inexpensively. It has surpassed the 

United States as the largest exporter of environmental goods 

• It has been argued that the market for environmental technologies will be 

served by U.S. companies. regardless of the level of environmental laws in the 

U.S. A counter argument is that, while market demand may be sufficient to 

promote dev10lopment of simple, non-technological products such as buggy 

whips, envirunmental standards established by the government drive the 

technology for complex, sophisticated products. Advances in Germany exist 

as a result of government mandates, placing German firms in a position to 

capture the nLarket as developing countries establish mandates of their own. 

-28-
Environmental 

Laws and Net Job 

Losses 

257 

Myths of Jobs Versus Resources: 

Environmental Protections and Economic Growth 

and services at $11 billion in products, to America's $10.5 billion 

and Japan's $5 billion." 

AI; in the United States, environmental initiatives in Germany 

are not universally popular. Wolfgang Higer, the chairman of 

Hoechst, Germany's largest chemical company, complained 

bitterly in 1991 that the government had lost all sense of 

proportion. He claimed that regulations threatened his 

company with losses of $100 million and over 250 jobs'' 

Edda Muller, former chief aide to Germany's minister filr the 

environment, in defending the economic impacts of strict 

environmental regulation, has stated, "What we are doing here 

is economic policy, not environmental policy."" Takefumi 

Fukumizu, representative to the United States for Japan's 

powerful Ministry of International Trade and Industry (MIT!), 

says industrialists in his country see "an inescapable economic 

necessity to improve energy efficiency and environmental 

technologies, which they believe will reduce costs and create a 

profitable world market. The potential profit in such a market 

is limitless."" 

While increased environmental spending has generated UB. 

jobs, there are also real costs, in terms of other goods and 

services that have been foregone. These must be factored into 

any equation measuring the overall impact of these laws and 

regulations. 

Certain industries, fur instance, are highly susceptible to 

environmental regulatory costs. This would appear to be the 

case for a small number of highly polluting industries." These 

include manufacturers of highly toxic substances such as 

asbestos and selected pesticides; copper, zinc and lead 

processing, and several producers of organic chemicals. 

rusessing the overall impact on the economy is more 

problematic. A 1990 study by Dale Jorgensen and Peter 

"U.S. Congress, 1994, p.118. 

~ Curtis Moore and Alan Miller, Green Gold: Japan, Germany, the United 

States, and the Race for Environmental Technology, 1994, p. 118. 

n Ibid. 

~ Ibid. 

~ H. Jeffrey Leonard, "Are Environmental Regulations Driving U.S. Industry 

Overseas?" 1994, Consf!rvation Foundation, Washington, D.C., 1984. 

-29-
258 

Mytlul of Jobe Veraua Reeource•: 

llnvironmental Protection• and .Economic Growth 

Wilcoxen" estimates that environmental regulations "lowed 

economic growth by about 0.2 percent per year between 1974 

and 1985. This study looks at resources used and goods 

produced to measure economic growth. Consequently, thE! GNP 

was about 2.5 percent less by the early 1990s than it would have 

been in the absence of regulations. The authors did not estimate 

the impaci.s on employment. If one extrapolates from their data, 

it is possible to come up with the figure of 3 million fewer jobs 

nationally between 1974 and 1992 as a result of environmental 

regulatiom. However, there is a major flaw in this work. Th2 

study fails to address the number of jobs that result from thes 

aame regulations. A study conducted at the same time ,~ 

Management Information Services, Inc. found that 

environmental regulations created 4 million jobs during the 

same period." This does not mean that the net impact on jobs 

can be said to be 1 million created, as the studies are different. 

It does hc·wever, cloud the interpretation of Jorgensen's and 

Wilcoxen's results. 

Jorgensen's and Wilcoxen's work is also interesting in that it 

contains many of the customary flaws in standard input-output 

modeling. As the authors themselves admit, they make no 

attempt tc assess benefits that might accrue to producHs or 

consumers as a result of these Jaws. Their models do not 

account for industries that result from compliance with 

environmental regulations, or export opportunities that may 

arise. 

It should also be noted that other researchers, modeling 

econometric input-output studies similar to the Jorgensen and 

\Vilcoxen's model, have come to very different conclusions." 

"Dale W. Jorgensen and Peter J. Wilcoxen, .. Environmental Regulation and 

U.S. Economic Growth," Rand Journal of Economics, 1990, Vol.21, No.2, pp 

314-340. 

H Management [nfonnation Services Inc. , TI.e Net Impact of Environmental 

Protection on Jobs and the Economy, Washington D.C.: MISI, March 1993. 38 Council or.. Economic Priorities, Jobs and Energy: The Employment and 

~conomic hnpacta of Nuclear Power, Conservation, and Other gnergy 

Options, New York: Council on Economic Priorities, 1979. The authors 

compared thf~ effects of using environmentally benign energy sources instead 

of fossil-fuel .. based sources and concluded that their use would result in 

positive econ•)mic and job benefits. 

R. Grossmar.. and G. Daneker, "Energy, Jobs, and the Economy," Boston, 

Mass. Alyson Publications, 1979. The authors, also from the Cow1cil on 

Economic Priorities. came up with similar results. 

-30-
259 

Mytlo. of Job• v .. ,..,.. lle•ource.: 

Environnwrdol Proteetion.a and Economic GroUJth 

Conclusion The numerous studies available show the overall impact of 

environmental protections on the U.S. economy is not 

significant. Job losses or gains as a result of federal 

environmental-protection laws have not had a great impact on 

either the loss of manufacturing jobs or decisions to invest in 

less-developed nations. Overall, national timber harvests have 

not declined as a result of spotted owl protections - reductions 

in the Northwest have been compensated by increased timber 

production in the South. Furthermore, reductions in timber 

harvests should lead to restorations in fishery-based 

employment, thus mitigating economic impacts. 

The question still remains: What are the impacts of 

environmental laws on individual states and jurisdictions and, 

in particular, on California? Was the California recession made 

worse by the level of environmental regulation in the state? 

CHART5 

GLOBAL GROWTH OF ENVIRONMENTAL INDUSTRY 

1993-1998 

4% 8% 10% 12% 14% 16% 16% . 

0 110 76 100 1110 176 100 

• BIWoa ill Rev--
260 

Myth.. of Job• Ve,..ru Reaource•: 

Environmental Prot«!tioru antllt:conomic Growth 

~ 8l8l 

C") "OO><ll-0>8 

en lii~~Sl~ 

en 

or- §§§~i ... g~~~5 Q) 

+J ••o~o cu 

+J 

U) 

>- .c 

en ~ .c ~~· 0 4 -:» 

= -

~ cu 0 +J .. c: 

0 Q) 

E 

c: 

0 

~ 

·-> c: 

w 

,.._ 

0 

~ 

Q) 

.c 

E f :::J I z ., ,.·, ,. -32-
California Econ.omy 

Remains Sluggish 

261 

MyiM of Job• Venau Reaoureee: 

Envlron~ntol Proteclio~ and Econornie Gro~»th 

Chapter II: 

The California }~conomy 

California has long prided itself as the destination for 

visionaries, entrepreneurs and innovators, who have built the 

Golden State into one of the world's most vibrant economies. 

Even in troubled times, California remains th~ world's eighthlargest economic power with a gross state product that exceeds 

$800 billion. With 32 million residents and l(l miliion 

households, California is by far the nation's largest state 

market. 

The recession of the 1990s, however, has destroyed the image of 

California as golden. Much of the self-confidence that 

characterized the state is evaporating along with the military 

bases and defense spending that fueled the boom. Structural 

problems facing California are far greater than those in the U.S. 

economy. This difference becomes clear in reviewing Chart 7, 

where job losses and gainB in California are compared with 

those in the national economy for various categories of 

industries. 

Even with the continuing U.S. economic recovery, the 

California economy is lagging. A£; shown in Chart 8 , there is a 

large gap in employment growth between a "normal recovery" 

and the expected recovery in California." 

" Dr. John Oliver Wilson, executive vice president and chief ec:onomist of 

Bank of America, speech to meeting ofU.C. Regents, October 13, 1993. 

-33-
262 

M1tJio of .lobo Verouo Raoun""'' 

Bn.oironmenltJl ProteetioM and Bconomtc Gro~tla 

CHART7 

JOB LOSSES, GAINS IN U.S., CALIFORNIA 

(Percent Change, July 1990- August 1993) 

I United States Californi~ 

The Recession of 

1990-93: How Many 

Jobs Were Lost? 

Downuizing Industries -1.7 

(Defenne, construction, retail trade, 

finance) 

Highly Cyclical Industries -3.3 

(Wholesale trade, machinery, electrical 

equipment, transportation) 

Moder·ately Cyclical Industries +2.5 

(BusiMSS services, instruments, food 

procesE<ing, printing and publishing, 

apparel) 

Stable-Growth Industries +3.6 

(Health services, engineering, and 

management services, communications, 

utilities) 

If the California economy were recovering in tandem with the 

U.S. economy, it would have 800,000 more jobs than currently 

exist ... (See Chart 9.) 

Chart 9 details the extent of California's economic decline 

during the recession, in comparison with the rest of the United 

States. Long-term job statistics have been substantially revised 

since they were first released; the Bureau of Labor Statistics 

(BLS) revised downward all of California's job estimates for 

1983 through 1991. According to the BLS, the number of jobs 

during that period initially was over-reported because payroll 

processing firms were double-counting workers. 

40 lbid, 

-34-

-6.3 l 

j -10.4 1 

-0.3 

+1.7 
;:;;u 

J 

4 

" .., 

0 

., 

0 

" 1:: 

,g 

i 

14 

13 

12 

11 

263 

Myth of Joba Ven,. Reaource~ 

EnPironnaentol Protft:lion. and Economic Groutla 

CHARTS 

EMPLOYMENT GROWTH IN CALIFORNIA 

(In millions of workers) 

10 +---~~~~~~ 

1985 1986 1987 1988 1989 1990 1991 1992 1993 1994 

Sour"'e: Bank of America 

-35-

1995 
264 

11¥1"- of .lobo Verouo Reoourceo: 

Brw,.,_.,al Prolectt.on. Gild Bconomie Growth 

CHART9 

COMPARISON OF JOB TRENDS BETWEEN CALIFORNIA AND THE U.S. 

July 1990 ·December 1993 

~ 0 

~ s -1 ~ . 

fo 

J -2 

u 

i! 

G 

e -3 

~ " 

~ 

SoW"Ce:: BIUllt of America 

-36-
, "' 

= Cll 

Ol 

= 0 

..r::: 

Eo< 

"' ·e 

~ -; 

u 

265 

Myths of Jobs Versus Resouree6: 

Environmental Protections and Economic Growth 

For July 1990, ·the effect of the BLS revision Wt>s to lower the 

baseline number of jobs at the beginning of the 1990-93 recession 

from 12,901,500 to 12,542,600 -- a reduction of more than 

350,000 jobs. 

At the same time, the BLS revised another figure, this one 

pertaining to the number of employed residents, or workers. 

This revision, making California's figures consistent with the 

1990 census estimates of workers in California, raised the 

estimated number of California workers during the recession. 

The BLS and Employment Development Department officially 

estimate that total nonagricultural wage and salary jobs 

(seasonally adjusted) fell by just over 600,000 in California 

between the peak in July 1990 and the low point in December 

1993. Prior to the revision, a figure of 950,000 lost jobs was 

generally accepted, thus magnifying the perception of the 

severity of the economic downturn. (See Chart 10, adjusted 

indicators of job loss.) 

0 

-100 

-200 

-300 

-400 

-500 

-800 

-700 

-800 

-900 

-1000 

CHART 10 

INDICATORS OF JOB LOSS 

July 1990 ·December 1993 

-83 

Old 

Estimates 

-602.3 

Revised 

Estimates 

Source: Bureau of Labor Statistics and 

California Employment Development Df'partment 

-37-
266 

Mytlo. ofJob• VeNru Re•ource•;· 

Envtron .. ental Protection. and Economic Growth 

California Job 

Losses in the Los 

Angeles Basin 

Between July 1990 and May 1991, the number of jobs in the U.S. 

&nd California economies fell by 1.3 percent, as shown in Chart 

9. Chart. 7 shows the difference in job losses by sector during the 

same period. The nationwide recession was a cause of job losses 

in California, but does not explain the magnitude of California's 

downturn when compared with the Urrited States as a whole. 

The serious slump tn California occurred after the nationai 

economy began its recovery. California remained in recession for 

another 2 112 years. Between May 1991 and December 1993, 

while the nation added 3 million jobs, the state lost another 

4:50,000. 

The fact that California stayed in recession while the n~tion 

began a recovery did not, however, indicate a loss in long-teem 

competitiveness California attracted a record level of venture 

capital in I993 and again in the first quarter of 1994. 

According to the Center for the Continuing Study of the 

California Economy (CCSCE), a respected source of independent 

information about long-term economic trends in California, the 

1~190-93 recession was deeper and longer in California as a result 

of four speeific factors: 

• A sharp decline in residential building, 

• A fall in federal defense spending, 

• A simultaneous drop in commercial aircraft orders, and 

• A drop in spending relative to income, which cost California 

$28 billion in retail sales throughout the recession." (See 

Chart 11 for a comparison of certain economic activity.) 

California's job losses were not spread evenly across the state . 

They wer•~ concentrated in Southern California -- and Los 

Angeles County absorbed 70 percent of them. The Los Angeles 

basin, made up of Los Angeles, Orange, Riverside, San 

Bernardino and Ventura counties, accounted for 473,1j00 of 

California's 602,300 lost jobs between July 1990 and December 

1993. (See' Chart 12.) 

""The Outlook for the California Economy," Center for the Continuing Study 

uf the California Economy, 1994, Palo Alto, California. 

-38-
267 

Mytlu of Job• y.,,...,. R"oo"""""' 

Environ~ntol Protection. arul Economie GroUJtla 

CBARTll 

CALIFoRNIA MANUFACTURING JOBS 

(Tho lUanda) 

I~, . July 1990 December 1883 Change Percent Change 

r :,_.,..,.co 350.4 219.1 131.3 

r·- . BigbTech 392.0 346.5 -46.5 r -;, ... 

· Conatructlon- 177.0 134.1 --t2.9 

Related 

Other 1,156.2 1,062.0 -94.2 

Manufacturing 

Total 2,077.6 1,761.7 -316.9 

Manufacturing 

Source: California Employment Development Department 

'Note: Data are not ~euonally acijuated. 

CBART1ll 

CALIFORNIA JOBS BY MAJOR REGION 

July 1990- December 1883 

(Tholl8anda) 

~OD .July1810 December cau....e 

1883 

: 

!A. Angel• Bum 6,248.0 5,774.8 --t73.1 

!A. Angel• CoUDty 4,130.8 3,702.3 -428.5 "! i' 

......... "'-Bay Ana 2,9311.4 2,832.4 -106.0 

..... Diego COUDty 866.4 833.8 -32.5 

.......... llegiOil 622.5 623.9 u 

a..tofStata 1,767.3 1.775.2 7.9 

Celilornia 12,542.6 11,940.3 -602.3 

aou-: California Employment Development Department: 1euonally acijuatad. 

-39-

-37.5% 

-11.6% 

-24.2% 

-8.3% 

-15.2% 

P-.otof 

State 

Change 

78.5% 

71.1% 

17.6% 

5.4% 

-0.2% 

-1.3% 

100.0% 
268 

Myths of Jobs Versus Resources: 

Environmental Protections and Economic Growth 

Defense Cutbacks 

in the Los Angeles 

Basin 

Chart 12 shows that some parts of the state, including 

Sacramento, actually gained a small number of jobs during the 

recession. The San Francisco Bay Area lost approximately 

100,000 jobs and accounted for 17.6 percent of the losses. 

The spotty geographical distribution of job losses strongly 

supports a hypothesis that specific factors, not a general and 

persistent deterioration in competitiveness, 3ccounted for most 

of the state's job losses. Los Angeles County, for instance, also 

was severely affected by the aerospace downturn and 

construction declmes. 

Business-related conditions and requirements -- such as 

workers' compensation, public infrastructure and state taxes --

for the most part are similar throughout California. Therefore, 

the fact that different geographical areas of the state had very 

different job losses indicates that statewide "business climate" 

issues were not the primary cause of California's long recession. 

lt might Beem an exception could be made for Southern 

California's en\'ironmental regulations, which are significantly 

more stringent than in the rest of the state, but a subsequent 

discussion of this issue (beginning on page 41) will show those 

regulations are not tied to a net loss of jobs. 

Two general explanations have been widely offered to account 

f0r the fact manufacturing jobs fell more in California than in 

the nation as a whole: 

Decreased defense spending led to national declines in 

aerospao:e and high-technology employment as a result of the 

end of the Cold War, and'or 

A lack of competitiveness spurred companies to relocate or 

expand outside the state. 

According to the CCSCE, evidence is now clear that most of the 

manufacturing job losses can be explained by specific factors in 

specific industries. The deepest losses in the manufacturing 

sector wen~ in aerospace -- primarily in aircraft and missile 

production. and in space, search and navigational equipment. 

More than 130,000 jobs disappeared between July 1990 and 

December 1993 -- a drop of more than one-third in the size of 

California's aerospace manufacturing sector. (See Chart 11.) 

-40-
No Evidence of 

Fleeing Industry 

269 

J,fyth• of Job• Verau• Reaourcetr: 

Enuironmental Protection.. and Economic Growth 

The aerospace job iosses, not unique to California , were related 

to national trends that reduced aerospace jobs by over 400,000, 

or 30 percent, in 3 112 years. 

It is important to recognize that twin factors acted upon the 

aerospace industry. A cutback in commercial airline orders and 

exports as well as defense spending reductions caused drastic 

declines in aerospace jobs. 

While this was a substantial loss, it was not unprecedented nor 

unexpected. Compare this cutback in military spending with 

the major reductions between 1969 and 1971, when President 

Nixon reduced U.S. involvement in Vietnam. That triggered an 

11.3 percent drop in California manufacturing jobs compa red to 

losses of 15.2 percent between July of 1990 and January of 1993. 

During the most recent recession, high-technology jobs fell by 

11.6 percent in California, mirroring the rate in the rest of the 

nation and leaving the state's share of the national industry 

unchanged." 

Losses in high-tech manufacturing jobs do not represent a 

decline in high-technolvgy production in the state, but instead 

reflect rapid increases in productivity, according to CCSCE 

statistics. Fewer workers are producing more sales and profits. 

In 1993, high-tech firms in the Silicon Valley rectched record 

sales and profits." According to Bank of America, significant 

future job growth can be expected as a result of productivity and 

technology advances. (See Chart 13.) 

Are environmental regulations part of a negative business 

climate forcing many industries out of the state to more friendly 

environs in Arizona, Utah, Nevada, Texas and elsewhere, as is 

commonly believed? 

According to CCSCE, while the number of persons coming t<J 

California from other states has fallen sharply since 1990 in 

response to the recession, the number of people leaving 

California has risen only slightly. Further eroding a notion that 

jobs are heading across the state borders, and skilled employees 

•

2 "The Outlook for the California Economy," Center for the Continuing Study 

of the California Economy, May 1992. 

"Ibid. 

-41-
270 

M:yilh. ofolob• v.,,...,. lle•o·urce•: 

EnrJirollltlental Protection,. and Economic Gro111th 

Southern California 

Air Pollution 

Control 

ReplatioJU 

with them, census data show that people who came to California 

from. other states between 1985 and 1990 were more highly 

educated and better paid than those who left. 

A mlijor study of manufacturing-sector business relocations, 

repo:rted in a May 1995 draft report by the California State 

University, Fullerton (CSUF), Institute for Economic and 

Environmental Studies, shows that 12,000 more jobs were lost 

from relocations during California's recession than were lost in 

the previous three years. (64,413 for 1990, 1991, and 1992, 

compared to 52,719 during 1987, 1988, and 1989). The report, 

entitled "Significance of California Air Pollution Control 

Regulations for Business Locations Decisions," was prepared for 

the California Air Resources Board. Business climate decisions 

are clearly one factor in this rising number of relocations. 

However, factors, other than pollution controls appear to be the 

primary causes of this "business climate" problem. The report 

concludes that the 22 percent change in the number of 

relocations (even if all had been related to air pollution 

regulations) was not a significant factor in California's recent 

job l·~sses. Moreover, the number of relocations fell in 1993, 

although the economy was still struggling. 

In surveys reported in the CSUF report, other business climate 

issues, such as workers' compensation costs, taxes, litigation 

issues, land use permitting, labor costs, and health care costs, 

were listed as the mlijor business climate concerns leading to 

deciaions to relocate. Air pollution regulations were not 

identified as one of the two or three significant causes of the 

relocations that did occur. 

Could the fact that 70 percent of the state's recession-era job 

l0118eB occurred in Loa Angeles County be related to the region's 

stringent air pollution regulations? 

The CSUF institute in April of 1995 released an important 

study titled, "The Automobile, Air Pollution Regulation and the 

Economy of Southern California 1965-1990.• The study, the 

first of its kind, eoucht to determine whether air quality 

regulations have unduly hampered economic growth in Southern 

Califi,rnia when compared with other parts of the country. The 

study focused on the loDg-term relationship between regulation 

and economic performance, specifically duriDg the period from 

1965 to 1990. 

-42-
271 

Myth. of Job• Venus Re•o"rces: 

Environrrn?ntal Protection• and Economic Growth 

-43-
272 

Myth. of Job• l'enrus Re•ources: 

Environmental ProtectioTUI and Economic Grou:lh 

-44-
273 

MytiN of .lobo Vereuo Baourr:n: 

Bnoironmental ProtectioJU a.rul Bconomle Growth 

CHART13 

CHANGES IN AIR QUALITY, 

JOBS AND POPULATION IN THE SOUTH COAST AIR BASIN• 

1964-1990 

100 . ...... . .. . ... . 

-60 

•Los Angele-, Oranae, San Bernardino, Riverside, Ventura Counties 

Footnote: Lead is expreued u percent cbanpe, in aqrap quarterly c:oncentratiom in microer~ per eubic meter. 

Ozooe it repf"'!Hnted by the percent chanp in annual number ofStap I epWod.•. 

Population and jot.. are pre.ented by percent chanp~~ in aMolute number. of each. 

-45-

-1-Population 

---Lead 

.. Ozone 

-><-Job• 
274 

MytM of Job• ve,.. ... Ret!OUI"Cf! ... 

Environmental Prolectic.•,.. and Economic GrofiJth 

Chart 13 illustrates the basic economic, air quality and 

population trends in the south coast air basin from the late 

19f;Os to 1990. It is clear that, while airborne lead and ozone 

declined precipitously, population and job growth contin'-led to 

riSE!. 

California's early environmental standards were the forerunners 

of federal controls. But the air pollution regulations in place 

tod11y in the South Coast Air Quality Management District 

(SCAQMD) are stricter than those anywhere in the state or 

nat:ion. 

If i1: is true that strong environmental regulations negatively 

impact economic performance, that finding should surface in the 

Cal State Fullerton study, which examined the most heavily 

regula ted industries in the most heavily regulated air basin in 

the country. 

According to the study, the region's economic performance 

improved, rather than deteriorated, over time. The basin's 

eco«omy grew faster than the nation's during the affected 

dece.des. Total jobs increased by more than 85 percent, 

compared with about 53 percent nationwide. (See Chart 14.) 

CHART14 

GROWTH IN TOTAL JOBS 

LOS ANGELES BASIN AND UNITED STATES 

1969-1990 

(Percent) 

1960-1990 1969-1979 1979-1990 

geles Basin &~.3% 35.8% 36.4% 

<I States 62.7% 24.3'11' 22.9% 

Soun:·e: Bureau of Economic Analysis, U.S. Department of Commerce 

The study considered the possibility that increased regulatory 

costs would affect job growth over a period of time. If this were 

true, then job growth in the basin should have fallen relative to 

national trends in the 1980s, as more stringent regulations were 

developed and implemented. The evidence studied did not 

support this hypothesis. The Los Angeles basin out-perfonned 

-46-
275 

Mytlo. of Joba y.,,..,.. Re•ourca: 

Environmental Protection. and Economic Gro111th 

the nation in job growth by more in the 1980s than it had in the 

1970s. Among nearly 30 metropolitan areas surveyed for the 

study, it ranked roughly at the mid-point in both population and 

job growth -- suggesting its economic pace matched its growing 

size. See Chart 15. 

Air quality regulations would be expected to have more effect on 

the manufacturing sector than on other sectors of the economy 

in the Los Angeles basin because manufacturing is an area the 

SCAQMD could most directly impact. Seventy percent of air 

pollution in the region results from mobile-source emitters (cars 

and trucks), but the development patterns of the region and the 

lack of public transit make control of this sector problematic. 

Stationary-source polluters, led by large manufacturers, 

especially the oil and aerospace industries, are much easier 

objects for regulatory attention. Though contributing only 30 

percent of the air pollution in the basin, stationary-source 

emitters were the object of the brunt of the regulations. 

Despite this fact, manufacturing jobs grew by nearly 17 percent 

in the Los Angeles basin, even as they declined 4 percent 

nationally. The Los Angeles basin had 5.1 percent of U.S. 

manufacturing jobs in 1972, 5.9 percent in 1979, and 6.3 percent 

in 1990, as shown in Chart 16. 

Some firms have chosen to relocate outside the region. Air 

quality regulations were not identified in the study as among 

the most significant causes of reported relocations. One-sixth 

(16.5 percent) of regulated firms mentioned air quality 

regulations as an important factor in their location decisions. 

Wage levels and average household income in the Los Angeles 

basin remained 10 to 15 percent above the national average. 

Average household income for Hispanic, black, and Asian 

households increased by more than the national average in the 

1980s in the five-county region. "No evidence was found that 

the region's economy was significantly affected by the regulation 

of vehicular smog," the study determined. Further study will be 

necessary to update this data. The recession of 1990-1993 is not 

included in the data on which these conclusions were based. 

-47-
276 

Mytlu of Job• Venru Reaourc.ea: 

En11iron-ntal Protectiona and Economic Growth 

.i ' ' ' ' ~i 

fPlfJ!HfUJJ]~J~~~~~Jliln~ ~ i< f' u~~ :3 J w .Jl 

~ 

-48-
CRART18 

PERCENTAGE SHARE OF TOTAL JOBS IN MANUFACTURING, BY U.S

La• Vee•• 

Santa Fe 

Wa1hincton 

Sacramento 

Miami 

Orlando 

Tue.on 

Hou1ton 

Au1t.ln 

Den•er 

Atl-ta 

Salt Lake Cit, 

Phoenl:r: ,1·~~ ..... 

New York 

Pltubuf'l'h 

San FraneiNIO 

Philadelphia 

.... ;t:'$:,ol;.l . 

tt.tetcb 

'P :- .. ,"'. Seattle 

~ ~-'\:"· .. -\.....~ 

Portland 

·-'·"-'i'Jt<.:-,"';h 

UNITED STATES 

·· -- --~ ~ • .ll.; 

Dalla• 

Booton 

Lot Ancel" 

Chlearo 

Cincinnati 

Clevela.ad 

Detrlot 

~",.;!' 

Charlotte 

Milwaukee 

0% 5'll> 10% 15% 

Source: CSUF Study 
278 

M,,tM of Jobs Versus ReB4Jurce•: 

En.vlronmental Protectlo1 .. and Economic Growth 

According to Robert K Arnold, co-author of the CCSCE report.: 

The California economy faces substantial economic 

challenges, however, the most important problems 

are being left unaddressed by the current focus on 

business climate issues, such as environmental 

laws. 

The highest priority is for more public and private 

investment and increased · productivity and 

competitiveness. There are more important 

determinants of California's competitiveness than 

business climate issues. Investment in education, 

infrastructure, research and development and new 

technology, and quality of life issues such as 

congestion, housing costs and pollution are much 

more critical to California's future. We should be 

focusing on competing with Germany and Japan, 

not worrying about whether a very small number of 

firms move to Arizona, Utah, and Nevada. 

Stephen Levy, director of the center, states in the report's 

executive summary that "the serious problems facing the 

California economy are those which the state shares with the 

nation. • Levy defines such problems as very slow improvement 

in living standarda during the past two decades and widening 

inequality in incomes, trends highlighted by recent cen&WI 

reports. 

Conclwdon Nearly 600,000 jobs have been lost in California since mid-1990, 

largely due to the nationwide receasion, defense spending cuts 

and a sharp decline in construction. Business flight was not a 

significant factor. 

-50-
279 

Mytlu of Job• Verous Resourcea: 

Environmental Protection~~ and Economic Growth 

Chapter III: 

Comparing Economic 

Performances of States with 

Strong or Weak Environm.ental 

Laws 

To this point, the national economy as well as the California 

economy have been reviewed in an attempt to discover a 

correlation between strong environmental protections and 

negative economic impact. Analyses of existing studies, surveys, 

and data do not show a significant correlation, however, 

between environmental controls and the national deindustrialization or the prolonged California recession. There is 

still one remaining critical question: Do states with strong 

environmental laws suffer in economic terms for having them, 

everything else being equal? 

In 1991, a study by the Goodman Group, of Boston, found that 

investments in conservation and various environmental 

programs would have substantial employment and economic 

benefits for the state of New York." 

In a 1992 study of Maine energy options, it was found that 

environment-based, demand-side management programs --

~ M.W. Tennis,!. Goodman and M. Clark, "Employment Impacts of New York 

State Energy Options," The Goodman Group, Boston MA, 1991. 

-51-
280 

Myt.hs of Jobs Venus Re•o11rces: 

Environmental Protectiontl an.d Economic Growth 

attempting to reduce electricity demand through conservation 

strategies rather than constructing additional power plants --

would create more johs in Maine than would altemative 

progi"ams." 

In a 1988 study, Timothy J. Bartik studied the impact of state 

government air and water pollution control expenditureoS, 

aven,ge cost of compliance, and allowed particulate emissions on 

plant location decisions. He found that firms are sensitive to 

cost variations among the states when deciding where to locate 

new facilities. However, environmental regulations had 

insignificant effects on plant location decisions."' 

Ar1 ~nalysis of the relationship between indicators of 

environmental risks and economic risks by two professors, Paul 

Templet of the Louisiana State University Institute for 

Environmental Studies and Stephen Farber of the University of 

Pittsburgh Graduate School of Public and Intemational Affairs, 

found the two are inversely related. The study developed ratios 

based on pollution emissions and jobs. It used emissions data 

from the Toxic Release Inventory (TRI}, maintained by EPA, 

and employment data from the U.S. Census Bureau. 

Total TRI emissions were divided by manufacturing 

empJc,yment to arrive at an emissions-to-jobs (E/J) ratio for each 

state. An analysis of the relationships among economic 

indicators, environmf'ntal indicators, energy-use indicators, and 

the E/J ratios showed that poor environmental conditions, weak 

environmental policies, and higher E/J ratios were all inversely 

related to economic welfare indicators, such as poverty, 

unemployment, and income disparity." 

~ M. Clark, I. Goodman, M. Anthony, and P. Kelly-Detwiler, A Comparison of 

the Employment Creation Effects of the AES-Harriman Cove Coal-Fired 

Generating Station and Maine Demand·side Management, The Goodman 

Group, Boston, MA, 1992. 

"'T. Barlik, "The Effects of Environmental Regulation on Busineas Location 

in the United States," Growth Change, Summer 1988, 19(3) pp 22-24. 

In a 1989 analysis Bartik followed up this study by reviewing the impact of 

state -ievel environmental regulations on the starl·up rate of small 

busine£>ses. In this study he did observe a significant, negative impact, but 

the effect was substantially small. 

T. Bartik "Small Business Start-ups in the United States," Southern 

Economics Journal, April1989, 55(4) pp. 1004-18. 

" Paul H. Templet and Stephen Farber, "The Complementarity Betwee:n 

Environmental and Economic Risk: An Empirical Analysis," Ecologico./ 

Economics, Vol. 9, No.2, February 1994, pp. 153-165. 

-52-
281 

Mytlu ofJobo Verouo Reoou"'""' 

Enuironmental Protectiono and Economic Growth 

In a second national study, the Institute for Southern Studies 

in Durham, North Carolina,.. examined the relationship 

between environmental ranking and economic growth, using 20 

indicators of each, to determine state ranking. California rated 

19th among the 50 states on the "gold" economic scale and 13th 

on the "green" environmental scale. These studies showed 

states that placed in the top third in environmental ranking (1-

16) averaged a placement of 8.5 among the 50 states in their 

economic ranking. Conversely, those states with poor 

environmental rankings, that placed in the lower third (34-50), 

averaged a ranking of 42.5 in economic performance. Complete 

data for the states' economic and environmental indicators are 

in the appendix. 

Comparing the two lists offers numerous revelations: 

• Nine states ranked among the top 12 on both the economic 

and environmental scales. 

Conversely, 12 states were among the lowest 14 on both lists. 

New England, Minnesota and Wisconsin rank best on both 

scales. 

The states most dependent on mmmg and oil production 

generally fair poorest on both lists. 

The study refutes the hypothesis that states with strong 

environmental regulations would show evidence of weaker 

economies. The institute found: 

States with stronger environmental policies did not 

experience inferior rates of economic growth and 

development compared to states with weaker 

environmental regulations. In fact the converse was 

true: states with stronger environmental policies 

consistently out-performed the weaker environmental states on all economic measures. 

This study is not conclusive, however, as the method of analysis 

simply compares ranks on two scales (rank order correlation) 

and is not the strongest statistical measure. 

"Institute For Southern Studies, Green and Gold, Bob Hall, Oct 1994. 

-53-
282 

Myths of Job• VeNua Re•ource.: 

B11vironmental Protectioru and Economic GrotDlh 

In the most significant study of its type, Stephen Meyer, 

director of the Massachusetts Institute of Technology's Project 

on Environmental Politics and Policy, ranked and categorized 

the states on the breadth and depth of their environmental 

pro1;:rams and economic health between 1973 and 1992.'9 Dr. 

Meyer and his colleagues at MIT have conducted rigorous 

studies of various industries, utilizing a variety of economic 

indicators, and covering different periods. Because studies at the 

national level are suspect due to the inability to control for the 

effects of coincidental political, economic, technological, and 

social changes on basic economic performance, the MIT state 

comparative studies are critical, as they allow the opportunity to 

invt•stigate the relationship between environmental and 

economic performance while controlling for numerous "nuisance" 

effects. Since the 50 states share common political, economic, 

technological, and social ground, but have developed widely 

variant environmental policies, state comparative statistical 

studies are most useful. 

The MIT study investigated the relationship between 

environmental regulation and economic performance in four 

analytical steps. 

1) Meyer sorted out and ranked the states by evaluating the 

relative strength of their environmental policies. 

The Clean Water Act, Clean Air Act, Endangered Species Act, 

and other national environmental laws were passed in the past 

25 years out of concern that the varying state laws would harm 

interstate commerce. It was feared that states attempting to 

protect their environments would be at a competitive 

disadvantage with states that had lax environmental 

enforcement. While national laws have leveled the playing fit!ld, 

important differences remain among· the different states. The 

first. step in the MIT analysis was to score the states on a set of 

roughly 20 environmental policy indicators, for example: 

wetlands protection, hazardous waste disposal policy, and 

endangered species protections. These lists were prepared for 

two separate time periods, 1982 and 1990. These appear in 

Chart 17. The states with more rigorous standards appear at 

•• Dr. Stephen Meyer, The Economic Impact of Environmental Regulation; 

Journal of Enuironmental Law and Practice (publishing date as yet 

unknown). 

-54-
283 

Mytla. of.Joba Veraua Reaou,.,ea: 

Bnoironmental Protection. and Economic GroU>tla 

the top (1-10), and the states with lesser standards of 

environmental protection are at the bottom of the list (40-50). 

California is near the top in environmental protection in both 

periods studied. 

2. Meyer measured the perfQrmance of state economies by 

reviewing four key state economic indicators: annual gross state 

product growth, annual non-farm employment growth, annual 

manufacturing employment growth, and annual business failure 

rates. 

3. Meyer then cataloged distinguishing state characteristics that 

could confound relationships between environmental regulation 

and economic performance. 

Chart 18 lists the 13 state characteristics used for statistical 

control. These are used because certain characteristics -- high 

personal incomes, for example - could skew the data. A state 

with high per-capita income might have strong environmental 

laws because there is a demand for them among a contingent of 

well-educated, afiluent people, and high incomes provide a 

strong capital base leading to a stronger economy. 

4. Finally, Meyer combined the data in a multiple regression 

(cross- sectional, time-series) analysis for the years 1982 to 1989. 

He also ran comparisons among the top 10 states and the bottom 

10 in his rankings. He then asked the critical question: "Did 

states that adopted strong environmental laws suffer in economic 

terms for having done so?" 

The short answer is no. The MIT studies found no systematic 

relationship between gross state product growth and 

environmental standing. 

They did not find a negative relationship between nonfarm 

employment growth and stronger environmental policies. In 

fact, "job growth - not job loss - is associated with stronger 

environmental policies. The 10 states with the strongest 

environmental policies appear to have experienced annual 

employment growth rates almost 0.6 percent higher than those 

of the 10 states with the weakest environmental policies .... 

10 Meyer, at p.8. 

-55-
284 

Myths of Job• Venr'" Re•o11rcea: 

Environmental Protectio"'' and Economic Growth 

In measuring annual growth in manufacturing employment, 

the results are similar. Meyer found that "many factors may 

account for the general trend in manufacturing job losses among 

the states, but strong environmental policy does not appear to he 

one of the more important ones."'' 

Critks of strong environmental laws might argue that negative 

impacts of strong environmental regulation would have beEm 

masked during the 1982-1989 period by the overall strong 

economy. They might contend the true impact would be felt mily 

if analyzed during a recessionary period. Meyer repeated his 

studi·~s for the years 1990-1992, a period in which the U.S. 

economy contracted. 

Findings during this period show a mixed result. According 1:c 

Meyer, the 10 states with the strongest environmental polici;)s 

showlld a .25 percent higher annual rate of job losses during the 

recesBion. Classical analysis would dismiss this re:sult as 

insignificant, as was the rate of job gain during the growth 

years. 

The odds that environmentalism is negatively associated with 

job growth during the recession are 3:1, which cannot be so 

readi:iy dismissed. However, annual business failure rates are 

lower in the states with strong environmental laws than in 

those with weaker laws. While the stronger states lost more 

jobs, fewer businesses went under, providing a basis for a 

stronger recovery. The two other measures studied, annual 

growth in gross state product and nonfarm employment, showed 

statistically insignificant relationships. 

Meyer Wtilt on to study one additional phenomenon. He 

explo:red whether states with strong economic growth in the '70s 

had adopted stringent environmental laws at that time with an 

accumulative effect in the '80s of putting a brake on growth in 

comparison to their prior economic strength in the '70s. 

The MIT team measured the difference in a single state 

betwE•en economic growth in the '70s and the '80s. 

The results once more showed a positive, but statistically 

insignificant, relationship: 

" Meyer at p.9. 

-56-
285 

Myths of Jobs Versus Re•ources: 

Environmental Protections and Economic Growth 

In general, moving from the 1970s to the 1980s, the 10 states 

with the strongest environmental policies saw an average annual 

increase of 0.4 percent in gross state product growth, nonfarm 

employment growth, and manufacturing growth, over and above 

what the 10 states with the weakest environmental laws 

experienced. The drop in the business failure rate for states with 

stronger environmental policies is further evidence against a 

negative effect. 

"These results strongly undermine the belief that a drag effect is 

present." · 

Chart 17 

State Environmental Standings 

-57-

24-936 96- 10 
286 

Mytlu of Job• Venrw &•ource•: 

Enuironmental Protectioru cuul Economic GroUIIh 

CHART 18 

STATE CHARACTERISTICS USED FOR 

STATISTICAL CONTROL 

• Size of Land Area 

• Economic Weight of Extractive Industry Sector 

• Pop1.1lation Crowding and Land Use 

• Energy Cost 

• Ecouomic Weight of Manufacturing Industry Sector 

• Size of Consumer Market and Labor Pool 

• Size of Economy 

• Technological Capacity 

• State Wealth 

• Extont of Economic Development and Urbanization 

• Manufacturing Labor Cost - 1 

• Manufacturing Labor Cost - 2 

• TaxRate 

Meyer is not willing to argue that strong environmental laws 

lead to strong economic growth because he believes there are too 

many other variables, such as education levels, to reach that 

conclw.ion." However, he said: 

The data shaw that at a minimum the pursuit of 

l'nuironnumtal quality does not hinder economic 

growth and deuelopment. The enuironmental 

i:mpact hypothesis, while theoretically plausible, 

has no empirical foundation and focuses attention 

on what is probably one of the least influential 

{actors affecting the pace of economic growth and 

deuelopment among the states . ., 

Two literature reviews support the Meyer findings. In a 

complete review of the literature for the September 1993 issue of 

"Environment," Roger Bezdek, who studies the impact of 

environmental laws on employment, concludes: 

u Stephen M. Meyer, "Environmentalism and Prosperity: An Update," 

Cambridge, Massachusetts, MIT Project on Environmental Politics and 

Policy, 1992. 

u Stephen M. Meyer, "'Environmentalism and Economic Prosperity: Testin1~ 

the Environmental Impact Hypotheaia," 1992. 

-58-
287 

Mytla. of.Jobo y.,,..,.. Resoureeo: 

Environmental Protectiono and BcoiiDmlc GroUJth 

Recent major empirical studies unanimously reject 

the hypothesis that there is a negative relationship 

between environmental protection and economic 

growth. In fact, when statistically significant 

relationships are found, they are invariably positive; 

in other words, the U.S. states and nations of the 

world with more stringent environmental 

regulations show the best economic performance. " 

Overall, there is relatively little evidence to support 

the hypothesis that environmental regulations have 

had a large adverse effect on competitiveness, 

however that elusive term is defined. Although the 

long-run social costs of environmental regulation 

may be significant, including adverse effects on 

productivity, studies attempting to measure the 

effect of environmental regulation on net exports, 

overall trade flows, and plant-location decisions 

have produced estimates that are either small, 

statistically insignificant, or not robust to tests of 

model specification . ., 

Environmental protection policies may cause the Joss of some 

jobs. But the above studies, among others, conclude that --

while the positive economic value of strong environmental 

policies still may be debated -- they do not result in a net job Joss 

at the national level.'" 

According to the Center for the Continuing Study of the 

California Economy: 

The California economy has strong long-term 

growth potential. The principal threat to job and 

income growth in California is the lack of a strategy 

to prioritize and fund critical public investments. 

w Roger H. Bezdek: Environment, Vol., No.7, p. 6-13, September 1993. 

"'A. Jaffe, S. Petersen, P.Portney, and R. Stevins: "Environmental Regulation 

and the Competitiveness of U.S. Manufacturing: What Does the Evidence 

Tell Us? Journal of Economic Literature: Vol.XXXIII, March 1995, pp. 132-

163. 

w Jacob Park, "'Going for the Green," Book Review of Green Gold: Japan, 

Germany, and tM United States, and tM Raa for Environmental Technology 

by Curtis Moore and Alan Miller, February/March1995, pp. 78-79. 

-59-
288 

M;ytlu of Join Ve,..,.. &.•oureeo: 

Bnvironmelltal Prol«:tioJU and Economic Growth 

Chapter IV: 

Conclusion 

Numerous studies have measured the impact of 

environmental laws and regulations on the national and 

state economies. These studies have not documented: 

• Any correlation between environmental policies and the 

ongoing restructuring of the economy in the United States, 

• Any .link between strong environmental protections and a 

shift from manufacturing to service-sector employment, 

• Any correlation between environmental laws and decisions to 

shift investments from the United States to less-developed 

countries. 

• Any slowing of state economic development as a result of 

endangered spec:ies listings. 

Contrary to common perceptions, environmental jobs are 

actually more heavily concentrated in private-sector 

employment than are other categories of work. 

No link has been established between environmental laws and 

productivity losses. While certain resource-dependent jobs have 

been lost in particular regions, studies indicate that, overall, 

such losses are mitigated by related job growth in other regions. 

-61-
289 

Mylla. ofololn y.,,..,.. Ruou,..,ea: 

Enviro,.,..,ntal ProlectW,.. ond lkonomlc Grollllh 

The California economy shows, at worst, only minimal overall 

negative impacts from environmental regulation. Furthermore, 

in the Los Angeles basin, the economy has actually outperformed the nation during the studied periods, despite having 

the strictest air pollution regulations in the nation; 

Finally, in the most conclusive study, states with strong 

environmental protection laws correlate with states that have 

maintained the most robust economies in the past 20 years. No 

evidence was found showing a correlation between strong 

environmental protection and weak economic performance. 

AS a result of these studies, it can be concluded that shifts in 

environmental policy whether intended to expand 

environmental controls or reduce them -- have no discernible 

negative impact on state economic performance. If 

environmental protections do have negative economic impacts, 

they are so marginal and transient that they are completely lost 

in the noise of much more powerful domestic and international 

influences. 

Meyer of MIT places the public policy debate in the following 

terms: 

Those who liue and work in states that haue 

uigorously pursued enuironmental quality and are 

now contemplating rolling back enuironmental 

standards as a quick fix to jump-starting their 

economies out of recession should reconsider. Based 

on the euidence, there is no reason to expect that 

loosening enuironmental standards will haue any 

effect on the pace of state economic growth. 

-62-
290 

11-yth. of .Joba Verwua Reaourcea: 

Eno~~andEconomic Growth 

APPENDIX 

Economic and Environmental Health Indicators 

Developed by Stephen Meyer of MIT for His 1992 Study, 

"Environmentalism and Prosperity: 

Testing the Environmental Impact Hypotheses" 

-63-
291 

Sources for Economic Indicators 

1. Workplace deaths 

Rate of traumatic deaths occurring at work, per 100,000 workers, for 1980-1989. 

Source: "Fatal injuries to Workers in the. U.S., 1980-1989," August 1993. Published by 

National Institute for Occupational Safety and Health, Center for Disease Control, U.S. Department 

of Health and Human Services, 944 Chestnut Ridge Road, Morgantown, WV 26505. Phone: (304) 

284-5843. 

2. Workers in high-injury jobs 

Percent of 1989 manufacturing workforce employed in major industries (two digit SICs) with illness 

and il\jury rates at least twice the national average for all private employers - 8. 6 cases per 100 fulltime workers. The five industries are lumber and wood products (19.5 cases), primary metals (19.4 

cases), fabricated metals (18.8 cases), food and kindred products (18.5 cases), and transportation 

equipment (17 .7 cases). These were also the five industries with the highest nonfatal illness and 

injury rate for 1992. 

Source: "Occupational Injuries and Illnesses in the United States, 1988" (August 1990) and 

December 15, 1993 press release (#93-553). Published by Bureau of Labor Statistics, U.S. 

Department of Labor, August 1990. Employment data from Bureau of Labor Statistics printout of 

1989 employment. 

3. Workers in toxic industries 

Percent of 1989 manufacturing workforce employed in major industries that released the most toxic 

chemicals. The five industries accounted for 75 percent of all releases in 1989. They are chemicals 

(48.1 percent), primary metals (13.3 percent), paper products (5.5 percent), transportation (4.3 

percent), and fabricating metals (3.6 percent). 

Source: "Toxics in the Community, 1989: National and Local Perspectives," September 1991. 

Published by Office of Toxic Substances, U.S. Environmental Protection Agency. Same employment 

data as in 2. 

4. Workers in jobs with high-risk of disease. 

Percent of 1991 nonagricultural workforce in the six industries with highest rates of occupational 

diseases, particularly lung diseases from fumes or dust, as identified by the U.S. Occupational Safety 

and Health Administration. The six are mining, cotton weaving mills, manufacturers of other cotton 

products, chemicals and allied products, rubber and miscellaneous products, and leather tanning and 

manufacturing. 

Source: "The Climate for Workers in the United States," 1994. Published by Southern Labor 

Institute, Southern Regional Council, 60 Walton Str~ .. t. NW, Atlanta, GA 30303. Phone: (404) 522-

8764. 

II. Disability benefits 

Maximum weekly benefits paid by state workers' compensation system to workers whose injuries 

make them permanently and totally disabled, 1992. 

Source: "State Workers' Compensation Laws," Table 7, January 1993. Published by Office of 

Workers' Compensation Programs, Employment Standards Administration, U.S. Department of 

Labor. 
292 

6. Employe•· health insurance 

Percent of nonelderly population in 1992 who received insurance coverage through their employer. 

Souru: •Sources of Health Insurance and Charaeteristial of the Uninsured," January 1994. 

Published by Employee Benefit Research Institute, 2121 KStreet, NW, Washington, DC 20005. 

Phone (202) 659-0670. 

7. Laws protecting workers 

Grade given by Southern Regional C-ouncil based on the weighed grouping of 17 possible state Jaws 

that protect a worker's rights and acceas to health information. 

Source: Same as 4. 

8. Unemployment rate 

Percent of all civilian workers unemployment, average for 1993. 

Source: Local Area Unemployment Division, Bureau of Labor Statistics, U.S. Department of 

Labor, Janu1uy 1994. 

9. Youth unemployment rate 

Annual average percent of non-institutional youth, age 16-19, unemployed for 1992. 

Souru: "Geographic Profile of Employment and Unemployment; July 1993. Published by 

Bureau of Labor Statistics, U.S. Department of Labor. 

10. Unemployment Duration 

Percent of unemployed who were job!- more than 27 weeks but still looking for work, annual 

average for 1992. 

Soura: Same as 9 

11. Employment Growth 

Percent change in annual average employment of resident&, from 1985 to 1993. 

Source: Local Area Unemployment Division, Bureau of Labor Statistics, U.S. Department of 

Labor, January 1994. 

12. Women's opportunities in top jobs 

Percent of jobs held by women in 1990 that are in higher psying categories: officials and managers, 

professional, and technicians. 

Source: "Job Patterns for Minorities and Women in Private Industry, • 1991. Published by 

Equal Employment Opportunities Com.miaaion. 

13. Minority opportunity in top job• 

Percent of jobs held by minorities in 1990 that are in higher psying categories: officials and 

managers, professional, and technicians. 

Source: Same as 12. 

14. Annuall pay 

Average annual pay in 1992 for all workers covered by unemployment insurance. 
293 

Source: "Average Annual Pay by State and Industry, 1992." September 16, 1993 news 

release (#93-372) from Bureau of Labor Statistics, U.S. Department of Labor. 

15. HoUBeholds in poverty 

Percent of population living in households with incomes below the poverty line, 1992. 

Source: "Poverty in the United States: 1992," Series P-60, No. 185, 1993. Published by 

Bureau of Census, U.S. Department of Commerce. 

16. Income gap between rich and poor 

Ratio of mean family income of wealthiest 20 percent of the population to the mean family income of 

the poorest 20 percent for 1990-1992. 

Source: Calculation by Jon Haveman, Perdue University, 1993. Based on merged U.S. 

Census Bureau's Current Population survey data for March 1991-1993. 

17. High-school educational attainment. 

Percent of household heads with at least 12 years of education, 1990-1992. 

Source: Same as 16. 

18. Tax fairness 

Score by Corporation for Enterprise Development based on equitable distribution of tax burden, 

including personal income tax progressivity, sales tax burden on low-income families, and use of 

unitary or combined business tax reporting. 

Source: "The 1994 Development Report Card," 1994. Published by Corporation f~r 

Enterprise Development, 1725 KStreetNW, Washington, DC 20006. Phone: (202) 293-7963. 

19. Business start-ups 

Number of companies applying for new employment service account numbers, per 1,000 workers 

(seasonally adjusted), October 1992 to September 1993. 

Source: Office of Advocacy, U.S. Small Business Administration, 1993. Based on data from 

Employment and Training Administration, U.S. Department of Labor. 

20. Job growth in new business. 

Percent of growth in employment at companies four years old or younger, 1987-1992. 

Source: David Birch, Anne Hagerty, and William Parson, "Who's Creating Jobs?" May 1993. 

Published by Cognetics, Inc., 100 Cambridge Park Drive, Cambridge, MA. Phone (617) 661-0300. 

Sources for Environmental Indicators 

1. Hazardous waste generated 

Pounds per capita of RCRA-regulated hazardous waste produced in state during 1991. 

Source: "National Biennial RCRA Hazardous Waste Report," 1994. Office of Solid Waste, 

U.S. Environmental Protection Agency. Based on reports filed under the Resource Conservation and 

Recovery Act (RCRA). Some states include waste-laden water in total pounds, others do not. 
294 

2. Tos:io ohellllioal disohargea 

Pounds per capita of to:ric chemicala released to the environment or transferred off-site by reporting 

manufacturing facilities during 1992. 

Soutu: "1992 To:rica Release Inventory," Aprill~. Published by Office of Pollution 

Prevention and Tones, U.S. EPA. 

8. Canoer-cawring tos:ins 

Pounds per capita ofto:ric chemicala 1-eleued to the environment in 1991 that are classified as 

poeitive or swpected human or animal carcinogens by the International Agency for Research on 

Cancer. 

Soum!: "Poisons in Our Neighborhoods: To:ric Pollution in the U.S.," November 1993. 

Published by 1he Citizens Fund, 1120 19th Street, NW, Washington, DC 20036. Phone (202) 776-

1680. 

4. Solid w...U generated 

Pounds per ca.pita of municipal solid waste produoed in 1993; many states include indUstrial waste 

destined for the same disposal facilities. Total U.S. solid waste is estimated at 614 billion pounds for 

1993. 

Souro!: 'The State of Garbag~l in America, • BioCycle magazine, April1994. Published by JG 

Press, 419 State Avenue, Emmaus, PA 18049. Phone (216) 967-4136. 

5. Solid waste recyoled 

Estimates by the states of percent of solid waste that is recycled, average of 1992 and 1993 figures. 

National total is about 19 percent. 

Source: Same u 4. 

6. Pestioidea1 

Estimated total pounds of active ingredients in herbicides, fungicides, and insecticides applied per 

1987 acre of harvested cropland. 

Source: L.P. Gianessi and C.A. Puffer, "Herbicides Use in the U.S.," December 1990; 

"Fungicide U11e in U.S. Crop Production; August 1992; and "Inaecticide Use in U.S. Crop 

Production," November 1992. Published by Resources for the Future, 1616 P Street, NW, 

Washington, DC 20036. Phone (202) 328-6000. 

7. Fertilizer use 

Pounds per capita of single-nutrient fertilizer used in 1993. A total of 56 billion pounds was used in 

1993, about 60 percent of the total for all fertilizers. 

Soun.,: "Commercial Fertilizers, 1993," December 1993. Published by the National Fertilizer 

and Environmental Research Center, Tennessee Valley Authority. 

8. Total water use 

Gallons per day capita used of surface and ground water for all offstream purposes, 1990. 

Source: "Estinlated Use ofWater in the U.S. in 1990," 1993. Published by the Geological 

Survey (Circular 1081), U.S. Department of the Interior. 
295 

9. Hazardous spills 

Gallons of unauthorized releases of oil and hazardous substances, totaled for 1990, 1991 and 1992. 

Source; Emergency Response Notification System database, Office of Solid Waste and 

Emergency Response, U.S. EPA. 

10. Global warming gases 

Tons per capita of gases from human sources contributing to global warming (carbon dioxide, carbon 

monoxide, volatile organic compounds, nitrogen oxides, methane, and chlorofluorocarbons). 

Source: "National- and State-Level Emission Estimates ofRadiatively Important Trace 

Gases (RITGs) from Anthropogenic Sources," January 1991. Published by Air and Energy 

Engineering Research Laboratory, U.S. EPA. 

11. Air quality 

Score based on degree to which residents live in areas that exceed national ambient air quality 

standards for ozone and/or carbon monoxide, 1992-1993. 

Source: "The 1994 Development Report Card," 1994. Published by Corporation for 

Enterprise Development, 1725 K Street NW, Washington, DC 20006. Phone: (202) 293-7963. 

12. Gasoline use 

Average miles traveled by car, truck or bus per gallon of gas consumed, 1992. 

Source:· "Highway Statistics, 1992," 1994. Published by Office of Highway Information 

Management, Federal Highway Administration. 

13. Miles driven 

Thousands of miles driven in 1992 by cars, trucks or busses, per square mile ofland in state. 

Source: Same as 12. 

14. Energy consumption 

Millions of British Thermal Units (BTUs, standard measure of heat) consumed per capita from all 

energy sources, 1992. · 

Source: "State Energy Data Report, 1992, • May 1994. Published by Energy Information 

Administration, U.S. Department of Energy. 

16. Change in energy consumption 

Percent change in per-capita energy consumption from 1973 to 1992. Most states decreased percapita energy use following the oil embargo. 

Source: Same as 14. 

16. State spending on environment 

Total spending in fiscal1991 for state program addressing environmental and natural resource 

protection. Includes state, federal, and other funds (fines, licenses, etc.) that pass through the state 

budgetary process. Excludes funds raised and spent by local governments. 

Source: "Resource Guide to State Environmental Management," 1993. Published by the 

Council of State Government, P.O. Box 11910, Lexington, KY 40578. Phone 9606) 231-1939. 
296 

17. Portion of state budget for environment 

State spendin1r for enVironmental and natural resource protection as a percent of state's total budget 

for fiscall991. 

Source: Same as 16. 

18. Environmental policy record 

Score based on 67 policy indicators (from recycling programs to ground water protection) measuring 

state initiative to protect the environment. 

Source: •1991-1992 Green Index," August 1991. Published by Island Press, P.O. Box 7, 

Covelo, CA 9ii428. Phone (800) 828-1302. 

19. Pollutio~t subsidy versus investment 

Score based on capital expenditures for pollution abatement made by a state's industries compared to 

national avera.ge for industries with similar chemical emiasiona. The higher the number, the greater 

the eventual subsidy required from public to pay for industries' poor pollution prevention strategies; 

a negative number means industries invest more than national avera.ge on pollution abatement 

equipment. 

Sourc.': Paul H. Templet, •Grazing the Commons: An Empirical Analysis of Externalities, 

Subsidies and Suatainability," 1994. Available from Templet at Inatitute For Environmental 

Studies, Louisiana State University, 42 Atkinson Hall, Baton Rouge, LA 70803. Phone (504) 388-

6428. 

20. Emissions-to-Job ratio 

Pounds of toxic chemical emissions per manufacturing job for 1991. 

Sourc<.: Same as 19. The E/J ratio, developed by Paul Templet, uses EPA's Toxic Release 

Inventory and employment data from U.S. Bureau of the Census. 
297 

Economic Hea1th Indicators 

State 

JUAlaaka 

Ari•cma 

Ark ...... 

C&l.J.fona.ia 

Colorado 

CcmDectic:ut 

~aware 

Plori.da 

O.OZ'!Ji.a 

worQ1ac• WGrltenl iD. ~ 1a Workaza ia 

Dea&Jul .... lllllla-~OIZ"Y - - lllgh-Di••• .. 100.000 ~- ~ nadlutriea 

aaceltUal< , ••• - "'••·- "'••·-

9.2 31 

36.1 50 

3.7 I 

12.0 u 1.3 17 

l.t 21 

1.1 1 

5.6 13 

1.1 30 

1.1 33 

37.1 

71.1 

17.3 

u.o 

33.1 

31.1 

60. 5 

27 . 7 

33. 7 

30.1 

32 

50 

3 

n 

26 

21 

36 

13 

23 

11 

21.7 32 

5.1 5 

1.3 I 

26.5 25 

21.0 30 

20.1 15 

U.l 65 

U.7 50 

25.1 27 

23.3 22 

2.51 

6.15 

1.00 

1.61 

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1.21 

0.51 

0.16 

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1.25 

u 

61 

26 

36 

u 

31 

16 

1t 

12 

30 

llax. v .. kl.y 

DJ.UbJ.lity 

..,.~ita 

$ -

600 

700 

611 

252 

336 

U& 

761 

321 

us 

250 

21 

3 

' 48 

37 

27 

1 

31 

26 

" Ba-U 6.1 15 67.0 U > 1.0 1 0.05 1 UO 13 

x4abo u.7 n 51., u 15.3 11 o.n n 335 37 

U1.1.Doie 6.3 17 32.0 22 31.1 35 1.16 26 681 & 

x..u.... 7.6 22 &2.2 31 60.0 63 0.15 22 360 ..l3 

Xowa I .0 21 lt. O 33 21.& 17 0 .U 11 755 2 

------------------------------------------------------------------------------)'-- IW>... 1.6 25 " · 1 U 31.7 U 1.15 27 2tt ' u ICeDtuc:l<y 11.6 31 30.3 17 27.7 21 3.05 U Jt& 31 

Louid.... 11.0 37 u . o 37 65.1 " '·" &7 307 63 

M&J.Da 7.6 2& 35. 1 21 36.1 3t 0.27 5 U1 21 

llazy1UI4 5.3 11 30.7 1t 27 .I 21 0.35 '" • 

Naaaac:bu.etta 

lcic:JU..., 

llilmeaot.a 

IUaaiaaippi 

lllaaour.t. 

--

Nebraaka 

H-.cla 

Bew llulpahire 

•- Jeraey 

2.3 2 

5.1 10 

6.1 7 

u.s " 5.3 11 

20.1 u 10.1 35 

10.1 3& 

&.& I 

3.3 ' 

H.. MexiCIO 11. I 4.0 

... York 2., J 

Jlorth Carol.i.D& 7 • 0 21 

llortll Dakota 13.5 U 

Ohio 

Ol<l.u.c.a 

o....., .. Peaaayl Y&Jd.a 

lthode Xal&Dd 

South Caroli.Da 

South Dakota 

'l'eDD•··-

...... 

Utah 

Ven.o11.t 

VircriAla 

Waah.iagtoa. 

W•at Virgi.aia 

Wiacotu~ia 

IIYOaiii4J 

•• , 21 

10.1 35 

5.1 u 3.3 5 

1.1 20 

1&.2 u 7.1 25 

11.3 31 

12.3 u 6.7 11 

1.& 32 

7.5 2l 

15.7 " 

6.2 11 

u.o " 

u.o 

55.1 

21.5 

31. 5 

&0. 7 

55. 0 

U.3 

u.s 

17.1 

11. 7 

21.7 

20.1 

11.1 

"·' &1.5 

35.2 

57.1 

36.1 

22.5 

17.6 

23 . 0 

21.1 

36.6 

u.1 

20 . 3 

31.6 

63.7 

31.1 

31.1 

10. 0 

7 

" 15 

30 

35 

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2 

5 

u 

10 

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31 

38 

27 

67 

25 

11 

6 

12 

11 

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21 

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22.1 20 

51.0 " 2&.0 23 

22.1 u 37.1 co 

5.5 ' 17.2 u 1&.2 I 

15.1 13 

33.1 31 

12.1 • 

21.1 11 

15.1 12 

u., 10 

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32.5 37 

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50.1 U 

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o.sc 

0.73 

o.u 

1.11 

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2.13 

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2.15 

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1.11 

3.01 

0.32 

1 . 17 

1.70 

1 .. 51 

&.21 

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1.35 

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3.53 

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9.12 

15 

11 

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2 

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7 

31 

35 

35 

32 

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20 

37 

" 33 

21 

6 

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50 

563 

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612 

231 

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632 

611 

631 

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311 

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" 
ECOifOKIC IIE<B IHDICA:IORS 

JU.-

JUalllca 

Ariaoua 

Arkauaa 

c:aJ.iforu..t.a 

Colorado 

CODDecticut 

»elawar• 

lP'loricSa 

ileo"'Ji& 

llawaii 

:rdabo 

llliDoia 

:tlll4i&A& 

:towa 

:k&naaa 

x.atuc:ky 

l.o1&iaiazaa 

JOCau.. 

llazy1&Dd 

.. aaac:bu.aetta 

llic:hi ..... 

XiDDeaot.a 

Jd.aaiaaippi 

'tliaa011ri 

-·--

N'ebraaka 

•....sa 

Rew llulpahizw 

a .. Jeraey 

New M-.ico 

Rew York 

llort.b Carolina 

Wort.l:L Dakota 

OlU.o 

Oklahc.a 

Orhmuoy1......U 

·Jt!ao4e xal&Dd. 

&oath caroli.Da 

South Dakota 

"'~···· Utah -· 

V•~llt 

VlrgiDia 

WaahiagtoD 

... t. Virginia 

W1aCOD8ill 

wy,.iDV 

COYWtracre 

By a.ployer' a 

llealt.ll :tD8. 

.. RAmi< 

66.8 

59.7 

60.1 

56.9 

55.5 

66.2 

73. I 

71 •. 2 

53.7 

57.1 

"·0 

62 . 3 

u.o 

70 . 1 

67.6 

67.1 

61 •• 

50.7 

66.1 

U.2 

70.2 

n.a 

&5.3 

53.6 

63.9 

59.6 

66.6 

61.2 

61.7 ,,.2 

52.5 

19.2 

71.2 

19.6 

55.9 

55.6 

60 . ' 

55.2 

76.1 

71 . 0 

65 . 6 

65 . 7 

56.6 

71 .. 4. 

67 . 6 

21 

3 

5 

67 

u 

30 

27 

17 '

19 

32 

50 

26 

12 

37 

20 

33 

16 

12 

" 31 

29 

31 

11 

" 12 

6 

10 

u 

23 

22 

60 

6 

17 

298 

Statutory u...ployProtectiG~U~ ..at 

Uzaa~~PloyJM:Dt Por 

Pozo ·worker• bt.e Yout.ll 

Ckad• RaDk " bJak .. RaDk 

2.0 " 7.5 u 23.7 u 12.0 25 7.6 65 18.8 26 

6.0 u 6.2 22 29.9 50 

11.5 26 6.2 22 21.6 37 

17.5 9.2 " 25.1. " 

11.0 33 5.2 12 n.o •o 17.0 6.2 22 10.9 

12.5 2' 5.3 13 10.9 2 

10.0 38 7.0 32 26.9 65 

9.0 u 5.8 18 19.3 29 

13.0 22 6.2 5 16.6 11 

9 . 5 39 6.1 21 16.6 19 

u.s 13 7 •• 38 21., 37 

8.5 u 5.3 13 18.7 25 

11.5 26 •• o 13.0 

11.5 26 s.o 11.7 

13.5 18 6.2 22 15.7 15 

•• o " 7 •• 31 20.. 35 

15.0 7.9 .. 19.0 28 

u.s 13 6.2 22 26.4 " 

15.0 6.9 31 l0 . 2 l' 

15.0 7 7.0 32 20.5 36 

16.5 3 5.1 11 12.1 

0.0 so 6 . 3 27 28.2 " 

11.0 33 6 •• 28 12.1 

13.5 11 6. 0 19 16.7 12 

11.5 26 2.6 1 11.1 

11.5 26 7 . 2 36 16.0 16 

15.0 7 6.6 30 26.2 u 

13.5 11 '·' 38 19.6 31 

13.5 11 7.5 u 19.9 32 

15.5 ' 7 . 7 '' 22.0 '0 

11.5 26 '·' 8 18.9 27 

13.0 22 6.3 1'.' 11 

11.5 26 6.5 29 19.9 32 

11.0 33 6.0 19 15.0 13 

u.s 13 7.2 36 19.5 30 

16.5 13 7.0 32 18.5 2& 

15.5 7.7 " 16.3 17 

5.0 67 7.5 &1 17.. 2l 

10.5 36 3.5 l 10.1. 1 

10.5 36 5.7 17 17.2 21 

9.5 39 7.0 32 23.. '2 

t.O U 3.9 3 13.5 10 

1s. o 1 s.• 15 16.8 20 

6.5 65 5.0 21.8 39 

u.s 13 7.5 u 15.2 14 

15.5 10.1 50 29.5 " 

15.0 '·' 13.0 I 

8.5 u 5.6 . 15 18.. 23 

- 13 -

10 

Dae.ploy-

..,.. Duration 

weeka R&Ait 

13.6 

12.0 

15.9 

13.0 

20 . 7 

13.7 

36.2 

22.5 

19.5 

22 . 5 

7 ·' 8.5 

22 .a 

12 . 9 

10.' 

11.9 

25.2 

18.1 

23.6 

l( .1 

" ·9 19.3 

u.a 

15 . 9 

18.1 

15.2 

11.0 

17 .o 

23 .a 29 .t 

lt.l 

28 . 6 

u.a 

16.6 

21.3 

17.8 

lt.7 

22 .J 

33.1 

16 ·' 

10.9 

12 . t 

15 · ' 11.5 

22.5 

18 . 5 

16.1 

30 . • 

11.9 

9 •• 

14 

10 

22 

13 

34 

15 

50 

38 

33 

38 

1 

2 

36 

12 

43 

29 

n 

" 

" 32 

18 

2~ 

l9 

20 

l7 ' 

62 

" 

16 

65 

l8 

25 

35 

28 

17 

37 

u 

26 

11 

ll 

7 

38 

ll 

2& 

" I 
299 

ECONOMIC HEALTH IIIDIC&tORS 

State 

.u.-

.U.aka 

Al:i.zoaa 

,....,...,_. 

Cal.ifonai& 

Colorado 

C:OIUWcticut 

Delaware 

Plorida 

Georgia 

B&waii 

%d&bo 

%111Aoia 

%Dd.I.IUioll 

%owa 

I<&Da&a 

Jtea.tucJty 

LoW.ai&D& 

llaiae 

IC&ryluwl 

MaaaacJ:u&aetta 

JCicb.ipa 

lli.Jm•aota 

JUaaiaaippi 

Miaaov.r:L 

WolltiUI& 

RGraab 

•....sa 

•- RulpaJ:Ure 

New Jeraey 

H .. Nexic:o 

H ... York 

Rorth Carolina 

Rorth Dakota 

Ohio 

Okl.U..... 

oreuo .. 

•-rl"'"&Dia 

llbod. Xalaad. 

South CarollDa 

South Dakota 

'l"eDDeaaV1rv1aia 

Maa.bi.zacrtoD. 

Weat Vlrgi.Dia 

Wi&COQ&J.a _..., 

11 u ll 15 

-1- OpportaiU.ty ()pport11Dity .o... rage llo1Uiebo14a a- ill - J- ill - J- .....,.ual Kit.lr. %Ac ... 1ta5-l,,J for .._.. f'ac 111Doriti•• Pay Below •a....rty 

------·-

13.1 25 .. - 22.1 I 

Z&.t ' 

13.5 21 

15.0 17 

11.5 Zt 

3.1 &2 

18.0 u 22.8 6 

21.5 

23.5 5 

lt.& 10 

7.& 37 

10.& 31 

1&.5 1t 

6.6 ]J 

1.7 32 

-1.0 &7 

11.1 30 

16.3 15 

o.8 as 11.6 21 

U.O 27 

12.3 2& 

7.5 36 

7.2 38 

1.1 3& 

&5.& 1 

u.o 26 

2.& .. 

lt.3 11 

2.8 u 1&.7 11 

-2.1 &I 

1.7 ]3 

-1.5 n 22.6 7 

7.8 35 

-o.8 " 15.1 16 

6.& u 13.1 20 

13.] 22 

27.& 3 

12.1 23 

11.10 u 21.62 2 

5. 72 &1 

17.57 1& 

-3.00 50 

li.J &5 

27.1 16 

26.1 11 

16.& &7 

. 2J.5 I 

28.1 10 

31.& 3 

za.& 11 

25.1 21 

11.2 &3 

DJ• 

22.& lt 

26.7 20 

21.1 &0 

21.& &1 

23.0 ]8 

20.1 &2 

25.3 27 

23 . t 3& 

:11.1 I 

ll.O 2 

21.7 21 

27.0 17 

1&.5 50 

25.0 30 

30.3 6 

2&.3 31 

15.3 &I 

26.2 23 

30.5 5 

26.1 22 

]0.7 ' 

16.1 " 33.0 1 

25.1 21 

23.2 37 

27.1 ll 

28.5 u 27.1 1& 

16.& n 

2&.2 32 

1J.1 .. 

25.2 2C 

23.6 ]5 

26.t 11 

25.1 25 

lO .• l 7 

27.2 15 

2&.0 3J 

2l.& l6 

- 14 

10.2 

17.2 

15.7 

1.6 

22.0 

17.2 

17.5 

17.2 

16.6 

11.3 

D/a 

15.& 

17.& 

1&.1 

u.s 

u.o 

13.2 

u .8 16.6 

11.2 

21.t 

11.2 

1J.6 

6.t 

17.2 

13.5 

11.6 

. t.3 

25.1 

21.3 

17.7 

22.8 

8.7 

1J.1 

u.o 

16.1 

11. 3 

11.3 

11.7 

7.7 

11.7 

11.t 

15.6 

15.7 

)6.5 

15.1 

&1.6 

11 . 2 

12.5 

12.3 

&5 22,3&0 

21 31,825 

2t 23,161 

•• 20,.108 

~ 28,13& 

31 

26 ' 

" 6 

11 25,0&0 16 

16 32,587 1 

20 26,516 10 

23 23,1U 27 

'' 2&,373 21 

25,613 12 

31 20,6&9 '' 17 27,110 7 

32 23,570. 23 

37 20,937 ,, 

lt 21,112 35 

3& 21,858 ]7 

35 22,3&0 31 

25 21,808 38 

10 27 ,1&5 t 

21,66& 5 

1& 27 ,&63 8 

• 25,315 1& 

50 19,237 &8 

1t 23,550 2& 

33 19,371 "' &3 20,355 &5 

" 2&,7&3 20 

3 2&,925 11 

7 32,125 3 

15 21,051 &2 

• 32,399 2 

&7 22,2&8 33 

11 11.9.&5 ,, 

27 24.,8&6 lf 

22 21,6tt 39 

1l 23,51& 25 

u 25,785 11 

&2 26.,315 22 

" 21,&23 u 

11 18,016 so· 

&0 22,807 2t 

2& 25,080 15 

30 21,176 36 

2 22,3&7 30 

21 2&,137 17 

1 25.,553 13 

' 22,169 3& 

36 23,022 21 

31 21,215 &1 

17.1 

10.0 

15.1 

17.& 

15 . 8 

&0 

6 

32 

&1 

31 

10.6 12 

7'·' . 6 1 

15 . 3 33 

17.8 &2 

11.0 1& 

15.0 31 

15.3 33 

11.7 20 

11.3 17 

11.0 1& 

11.7 " 

2&.2 " 13.& 26 

11. 6 11 

10.0 6 

13.5 27 

12.8 25 

2&.5 50 

15.6 36 

13.7 28 

10.3 9 

1&.& 29 

1.6 2 

10.0 6 

21.0 &7 

15.3 33 

15 . 7 37 

11.1 22 

12.~ 2& 

18 . & " 11. 3 17 

11.7 20 

12.0 23 

18 . t &5 

1&.8 30 

17.0 3t 

17.8 &2 

t.3 

10.& 11 

9.~ ' 11.0 1&-

22.3 " 

10 . 1 1l 

10 .l 9 
!COIIOKI C IIEALTB IHDICATOIIS 

State 

.uAl.aaka 

Arizona 

ArkaD••• 

Califon>l.a 

Co.lorado 

Ccnmec:tic:ut 

Dela-re 

Plor.ida 

Georgia 

Hawaii 

IcSaho 

Illinoia 

.Ind.iaaa 

Iowa 

lteDtuc:ky ~··· Louiaiana 

llai ... 

Mary1&Dd 

Haaaachu11etta 

Michigan 

MJ.nneaota. 

MiaaiaaiJnti 

Kiaaouri -t .... Nebraaka 

Nevada 

N.., Ha.pah.ire 

New Jer•••Y 

New Mexic o 

New York 

North Caro.lJ.Aa 

North Dakota 

Ohio 

Oklahcaa 

Oregoa 

Pennaylvuda 

Jtbode Xa;lADd 

South carolina 

South Dakota 

TeDD.eaaee 

Texaa 

Utah 

Ve~nt 

Virginia 

Waahiugton. 

Weat Virainia 

Wiaconain 

W'yoaing 

16 

...... in 

IDC_, 

DiatributiOD 

...... RaJllt 

10.21 

8.35 

9.01 

9.20 

10.80 

8 . 37 

6.90 

7.10 

9.18 

10.95 

7 . 78 

7.10 

9.73 

8.43 

6.63 

7.60 

11.21 

13.99 

8.51 

8.0& 

9 ... 

9.27 

7.60 

10.75 

10.36 

7.99 

6.67 

8.47 

7 . 68 

8 . 98 

10.6& 

11.21 

8.88 

7. 69 

8.49 

9.77 

8.0& 

8.01 

1.68 

8.99 

7.17 

9. 72 

10 . 4.4 

6 . 63 

7.85 

8.51 

7 . 55 

9 . 60 

7 . 02 

7 . 23 

6 

33 

67 

1& 

15 

39 

23 

10 

&I 

50 

26 

18 

36 

35 

10 

u 

&2 

17 

3 

2& 

12 

30 

" .. 

29 

13 

25 

&0 

11 

20 

l8 

31 

17 

Ectu.c:atioual 

AttaU...ta 

Kic.h 8daoo1 

Gra.S. Rank 

73 

" 13 

73 

81 

II 

16 

10 

80 

7$ 

" 11 

80 

77 

82 

86 

70 

71 

81 

80 

8& 

10 

85 

69 

80 

85 

16 

16 

82 

81 

80 

78 

72 

" 80 

78 

8& 

79 

75 

70 

78 

70 

,. 

81 

12 

79 

88 

68 

11 

85 

&2 

1 

15 

43 

20 

6 

22 

25 

39 

18 

67 

&5 

23 

2& 

13 

31 

10 

&9 

27 

11 

16 

19 

26 

35 

" 33 

30 

36 

u 

34 

40 

&6 

38 

.. 

36 

' 17 

32 

50 

21 

12 

300 

18 19 

State BuaiD••• Job Crowth 

'!'ax St&na Per In .IJew 

Pairneaa 1000 worker• Buaineaa 

Orade R&Dk I R&DJc % Rank 

11.6 .. 5.5 JB 10.1 12 

&2.5 19 10.9 11.5 9 

"·' 5 6.5 27 5 . 4 35 

19.' &1 7.2 19 3.1 42 

77.9 1 10.0 7.5 28 

55.0 10 I.J 13 8.5 20 

u.a 12 5.9 33 ~.1 43 

39 . 3 2& 7 . 2 20 18.2 

19.2 &2 9 . 8 10.6 11 

19.5 &0 7 , 7 18 1.9 '' 

&8.3 14 6.1 31 11 . 3 10 

6&.9 10 . 5 8.9 18 

67.0 16 5 . 8 35 0 .5 46 

15 . 8 <5 5.3 41 8.0 2& 

29.0 37 4.5 " 12.4 

&1.2 15 6.0 32 8.3 21 

31.6 32 5.2 '2 7. 7 27 

23 . 6 39 5 . 6 37 10.0 13 

72 . 6 3 8.0 16 0 . 9 &5 

"·' 13 1 . 9 10 6.2 34 

39.1 26 s.o 44 5.1 37 

&3 . & 18 '·' '9 9.3 15 

4 . , 48 14.3 4 

31.0 33 5 . 9 3& 8.6 19 

32.2 31 5 . 7 36 15.8 

63 . 2 8.9 5.2 36 

51 . 3 11 5 . & 39 14 . 2 

17 . 0 '' 8 . 1 15 3 . 3 41 

Jt . 2 25 9 . 1 •9.9 50 

38 . 0 l7 , , 9 2:l 8.1 23 

30.' 35 8 . 2 1' 7.5 28 

&1.2 21 6.9 22 7.1 26 

30.2 36 6.6 26 9.1 16 

55 . 5 9 5 . 2 &3 -6 . 5 &9 

33.9 30 3.9 50 6.7 32 

30 . 1 3& 6 . 6 25 6.8 31 

61.0 7 8. 8 11 12 . 5 1 

&0. 7 23 &. 6 &5 6.6 33 

36.6 28 8 .7 12 •6 . 2 48 

41.1 22 5 . 3 •o 4 . 5 38 

6.5 50 6 . & 29 8.2 22 

14.1 &6 6.2 30 8 . 0 2& 

12 •• 67 7 . 0 21 9 . 6 u u.s 20 7 . 9 17 16.0 2 

60 . 6 8 9.2 7 4.5 38 

35.1 29 '·' 2' 7.3 30 

10 . ' '' 12.5 13 . 4 6 

26 . 0 38 ' · ' 28 3 . 8 &0 

u.s 17 • . 6 '' 9 . 1 16 

19.0 &3 9 . 9 5 •2.5 47 

- 15 -

PJ.Dal 

score 

70' '' 405 13 

"' 18 71& 47 

671 19 

395 11 

337 4 

349 5 

550 36 

''' 42 

252 1 

494 22 

530 29 

579 38 

419 15 

500 23 

675 &5 

783 50 

533 31 

373 10 

&00 12 

506 25 

299 

766 &9 

532 30 

507 26 

uo 16 

525 21 

355 6 

'JS 17 

581 39 

671 19 

537 32 

5'1 3' 

570 37 

668 43 

361 

677 21 

503 2& 

673 4' 

su 35 

630 u 626 40 

407 1' 

302 3 

508 27 

357 7 

731 48 

369 

539 33 
301 

Environmental Health Xndicators 

1 2 3 

aa..- ~ -c em.cer 8o1i4 

Stat• ••t:• ~ C&aaiDg wut.e a.a.erat:.ed Di.~• ~ CMIIMC'at.ed 

Lb p/a 11aaJi: Lb JI/C 11aaJi: Lb JI/C JtaDk Lb JI/C JtaDk 

AlAlaal<a 

Artaoaa· 

Arl<&a8ao 

ca11fonaia 

Colorado 

CODDec:ticut 

Delaware 

Plorida 

a.orvia 

Hawaii 

Xdallo 

Xll.iDob 

Ill4i.,.. 

Xowa 

I<Am8ao 

~tucky 

Loaiaiaaa 

llaiAe 

Mary~-

ICaa-chuaetta 

llichivaa 

lli.JuMaota 

IU.aaiaaippi 

IUaaouri 

2,230 

u. 705 

1,511 

1,33& 

3,13C 

23 

&5 

11 

15 

26 

••• 5,539 31 

3,171 . 27 

172 ' 5,350 37 

11 

11,320 

3,305 

3,130 

1,017 

2 

., 

21 

25 

13 

4,211 30 

5,072 32 

21,320 C7 

53 • 

131 11 

1,)?1 u 

17,210 " 

C,531 31 

7,117 f.l 

12'7 10 

-·- 57 5 llebraalta 1,105 21 

- ,, Hew Ba.pahir• 1, 512 11 

Hew Jera•y 20, 573 '' 

H.., Nexico 

KMr York 

llorth Carolizl.a 

llorth Dakota 

OIU.o 

Oltlab--. 

o...,..,.. 

PeDD.ayl TaDJ.a 

Rhode Ial&lld. 

South Caro.lizw. 

South Dakota 

T~•••• 

....... 

Otah 

VeZ'liK)nt 

Virginia 

Waahia~oD 

Weat Vircri.Dia 

Wiaeonain 

Wyoat • .,. 

1,01C 12 

5,1U lC 

1,223 1C 

2,259 2C 

no 

3,725 

1,7ta 

11,312 

5,101 

2,192 

21 

21 

42 

33 

22 

30,540 50 

22,1Cl 41 

'· 221 3C 1 , f.Sl 17 

7,111 40 

'· ll.a 35 26,1U ct 

... '· ••s lt 

4C.O 31 

25.7 21 

11.7 23 

U.l CO 

7.1 

S.t 5 

15.7 1'7 

25.1 31 

9.5 10 

11.7 22 

0.1 1 

10.C 11 

35.1 35 

"·2 " 2C.5 21 

51.7 

C2.5 

111.2 

11.3 

1.2 

u 

37 

50 

11 

1.3 I 

35.5 ,. 

1C.2 U 

72.1 .. 

11.1 ., 

"·' ., 23.1 25 

3 . 2 2 

13.C 13 

2'7.3 31 

13.. u 1.1 7 

35.0 33 

3 . 1 3 

•••• 3C 

11.1 

13.1 

22.1 

17.5 

u .i 

11 

15 

25 

20 

42 

23.0 4C 

1.1 u 

0.1 ' 

3.3_ 22 

1.4 12 

1.5 

27.9 

2C.7 

0.5 

C.1 

13 

u 

u 

25 ' 

0.1 1 

0.7 I 

7.3 35 

u.o .. 2., 11 

'·' 27 21.5 " u.s 50 

2.1 17 

2.9 21 

2,529 

1,70' 

1,179 

1,7t& 

2 ...... 

2,535 

1,,03 

3,0U 

2,177 

2,3&0 

3,UI 

1,&111 

2,530 

1,55C 

1,522 

2.,171 

1,71& 

1,525 

2,011 

2,037 

37 

11 

11 

13 

.. 

u 

n 

31 

" 10 

Jl 

' I 

21 

12 

9 

2C 

25 

7 •• 31 2,251 30 

7.1 33 2,151 42 

2.1 20 1,1" 20 

s.1 29 1,377 

1.1 31 2,111 u 

0.5 5 

1.7 15 

0.2 3 

2.i 1t 

C.5 2& 

'·' 21 &.7 30 

7.0 32 

0.1 2 

1.1 J1 

15.5 3., 

1.1 

0.9 

7.1 

C2 

23 

31 

10 

,. 

1,105 . 15 

1, itt 7 

3,411 50 

1,9" 21 

1,17C u 

1,151 1t 

2,712 u 2,01C 23 

1,572 5 l .• 17::t ,. 

1,106 

2,015 

1,512 

2.,311 

3,114 

u 

26 

' 35 

" 5.3 C 0.6 2,lU J2 

51 . 5 .. 12.1 41 2,119 29 

,,.1 41 72.9 '' 2_.7715 '0 

"·' u 1.2 11 2,161 27 10.5 12 11.9 40 Z,C56 J6 

19.5 21 

20.1 2C 

n.c n 23 . J 27 

32 . 3 32 

- 16 

3.9 2C 

1.5 u 11.2 n 1.0 ]7 

0.4 • 

2,31C 

2,37C 

1, 17& 

1,t97 

1.373 

H 

3l 

17 

22 

soli4 

waece 

RecyelR 

.. -u 

' 9 

11 

11 

23 

20 

23 

2J 

12 

9 

1& 

• 20 

' 15 

u 

30 

1t 

2t 

26 

27 

" u 

33 

33 

12 

15 

13 

5 

30 

.. 

38 

22 

42 

17 

., 

2C 

27 

1t ' 

co 1 

• 31 

16 22 

61 

I C2 

13 2J 

10 35 

37 

7 C5 

22 u 5 .. 

17 21 

20 17 

10 

25 

15 

11 

20 

35 

25 

21 

15 

10 35 

9 Jl 

12 Jl 

1l 21 

27 7 

2C 

H 

11 

24 

10 

J 

J3 

10 

50 
302 

ENVIRONKEIITAL HEALm INDICATORS 

10 

Spill• of Clobal Wana.inq 

St.ate Per Acre of 

Harveat Crop 

U•• Per 

Capita 

Lbo R&AJt 

Use Per Ha:&. Liquids 

Capita 1990-1992 

Lba Rank Gal/ day .Ra.Ak Gal. Rank 

u .w... 

Al&aka 

Arizona 

Arltanaaa 

C&.lifornia 

Co~orado 

Conn•ctieut 

Delaware 

Florida 

Georqia 

Hawaii 

X<5aho 

XlliDoia 

Indiana 

x .... 

lt&:a.aaa 

lte:a.tucky 

Louiaiana 

Kaine 

Maryland 

Ka•aachuaet ta 

Michigan 

Ki.:l:m.eaota 

Miaaiaaippi 

Missouri 

Montana 

Ne.braaka 

N•vac!& 

N., Raapahire 

N., Jeraey 

4.2 

n/a 

7.8 

2.5 

23.9 

1.6 

3.1 

3.5 

41.3 

5.2 

n/a 

2.2 

2.4 

2. 6 

3.0 

1.1 

2.1 

4. 0 

3.9 

2.9 

6.3 

4. 0 

1.8 

3. 6 

1.7 

o.s 

2.2 

0.3 

1.4 

8.1 

N•w Hexi.co 3 • 7 

N.., York 3. 7 

North Carolina 3. 6 

North Dakota 0. 8 

Ohio 2.4 

OJclahaaa 0.8 

Oregon 3.6 

Pe~ylV&Aia 2.7 

Rhode Ial.&Dd 5 • 7 

Sou.th Carol. ina 4.' 

South Dakota 

T•nn••••• 

Texaa 

Utah 

Ver.ont 

1.2 

1.7 

2.4 

2.3 

1.5 

42 

" 23 

u 

28 

30 

50 

.. 

197 29 

104 17 

501 41 

111 19 

204 30 

3 

194 28 

36 11 

133 :Z2 

2, 002 H 471 21 

1,165 14 212 

1,793 32 1,762 38 

3,335 .. 267 13 

1,573 "' 8,057 .. 

3,86& 45 

1, .,5 l4 

2,055 35 

1,386 22 

827 

131 

410 

9,461 

332 

.. 

• 20 

u 

16 

95 14 2,472 39 2U 12 

18 1,043 '' 19,568 50 762 27 

22 ''' 39 1,577 :n l,s&a 36 

24 441 38 1, 701 30 700 25 

1.7 1, 620 48 1, 030 180 

16 

41 

38 

26 

" 40 

13 

34 

11 

988 •5 311 35 

166 #5 

23 8 

96 15 

150 23 

657 .. 

410 37 

503. 40 

2,454 38 649 24 

1,172 15 307 15 

2,217 36 (,571 46 

929 226 10 

1,341 19 2.236 41 

917 1,011 32 

1,248 17 1,489 35 

'" 3 476 22 1,413 23 uo 23 

1,354 21 773 28 

619 42 11,655 48 1, 561 37 

17 1,913 u 5,667 ., 217 

9 2,789 42 2,460 43 

•• 

37 115 20 

36 31 10 

33 165 24 

3 2,164 50 

20 249 33 

32 

25 

45 

u 

378 )6 

249 32 

40 12 

20 

105 18 

1, 097 " 

12 190 27 

21 169 26 

19 125 21 

41 13 

1,185 16 212 

1,658 29 730 26 

2,297 37 279 14 

1, 056 10 858 31 

1, 350 20 840 30 

4,195 46 230 11 

1,079 11 2,037 40 

529 2 2.653 44 

2, 966 43 344 17 

827 7,767 47 

524 70 l 

1,721 31 3,597 45 

851 

1, 864 33 

1, 484 25 

2,600 41 

1,123 13 

40 

831 

9, 750 

1, 789 

12 

29 

50 

39 

G•••• Per Capita 

Tone Rank 

32.8 

n/a 

19.0 

30.9 

15.6 

4:3.1 

13.1 

25.2 

12.9 

26.0 

n/a 

15.7 

30.8 

48.5 

26.4 

32.1 

34.4 

51.6 

18.4 

17.5 

U.3 

20 . 9 

19.7 

20.8 

2(.2 

39.5 

24 . 7 

21.2 

U.2 

13 • .2 

44.2 

11.5 

18.7 

89.1 

27 .o 

33.0 

13 ·' 

23.3 

9.6 

17. a 

18 

38 

10 

27 

32 

3 

33 

11 

37 

46 

34 

40 

43 

47 

16 

14 

21 

19 

20 

29 

.. 

31 

2:Z 

45 

17 

49 

35 

28 

15 

23 

30 

39 

36 

--------------------------------------------------.. ------------------------------ Virginia 

Weebin~on. 

W••t Virgill.i& 

Wiacon•in 

Wy'OIIi.nq 

3.6 

3.6 

1.8 

1.9 

1.7 

31 

35 

u 

15 

10 

97 16 

216 31 

27 ' 310 l4 

655 u 

1,109 12 

1, 633 28 

2, 554 40 

1,331 18 

16,753 u 

- 17 -

1,415 

359 

391 

221 

1, 359 

34 

18 

19 

33 

17.3 

17.1 

61.7 

21.9 

163.4 

13 

12 

48 

24 

50 
303 

EIIVIJioKKE!rrAL HEALTH DIDIC&toRS 

11 12 13 15 

Air A..-rap lOOOa of 'l'Ot:.&l -ray c:h&.Dge ID 

Stat.e Quality IUlaa hr llll.aa Dri.'Y8D. C0JW1111DtiOD P/c bargy 

G&l.lOD Gaa P•r SCI Jli1a JUUJ.oa. II'I'Ua cou.au-ption 

Grade R&Dit I - I - p/C - .. ltaDit 

Al.-

Alaaka 

Ari&OD& 

ArkaAaao 

Cal.ifonU.a 

Colorado 

Cozmeeeic:ut 

Delaware 

P'lori.cla 

Georgia 

Hawaii 

Idaho 

Illinoia 

I...Uana 

Iowa 

JtaD••• 

Jlteatucky 

Louiaia..Da 

IIUDO 

Maryl&Dd. 

ll&aaacbuaet.t.a 

IUcbigan 

KiDaaaot.a 

IUaaiaaippl 

IUaaouri 

New H..-pah.ira 

New J'eraay 

0.11 15 

0.11 21 

1.62 31 

0.00 1 

5 . &1 50 

1.18 32 

&.29 n 

2.11 n 

0. 73 26 

1.11 32 

0.00 1 

0. 00 

3.18 '' 

0. 82 29 

o.oo 

0. 00 

0 . 66 20 

o.u 17 

1.25 " 

3 . &1 46 

3 . 33 u 

1 . 17 31 

0.53 u 0.00 

o. 70 2& 

0 . 05 1& 

0 . 00 

0.68 22 

o.n 23 

5 . 09 " 

New Mex.ic:o 0.30 16 

New York 4e'l ,. 

Korth Carolbaa 0. 72 25 

North Dakota 0 . 0 0 

Obio 1. 3'7 37 

Okl.- 0.00 

Oregon o. '' 21 

Peaaay1Y'&.D.i.a 2.01 41 

Rbode Ial&Dd 2.11 43 

South Caroli.Da 0 . a 1 13 

Sout.h tl&Jr:ot.a 

TallllaaaT-.o 

Utah 

Var-oat: 

Virginia 

WaahiD~Oil 

Waat Virg:lllia 

Wiac::oDain 

Wyoaino 

0.00 

0. 75 27 

1 . 62 31 

1.1& 30 

0 . 00 

1.26 35 

1.36 36 

0.51 11 

1.85 &0 

0. 00 

16.1& 25 U2 21 &00 

13 ... 7 4.1 7 1 l . D&l 

16 . 71 2J 301 1& 246 

1&. 12 &7 &&3 17 332 

17.11 22 1.613 &0 230 

16.77 27 279 11 

17.63 5.au n 17.63 .3.525 45 

16. 7& 21 2.11t n 17.72 7 1.3&5 J& 

20 . 33 1 1.256 33 

17.67 130 7 

16.22 35 1.576 37 

16. 95 25 1. sn 11 

u.n as n1 16 

16.99 l& lt5 13 

16.01 37 951 29 

15 . 37 &1 777 26 

17 . 37 U JU 15 

17.51 15 &.216 u 

11.27 6.0&1 &I 

17.53 13 1.&12 36 

17.&0 17 

1f.3& J& 

15.6& &0 

517 u 559 20 

773 25 

15.05 n 5t 

1&.J2 u uo 13.11 50 " 6 

17.J1 1.122 30 

16.51 11 a.ool so 

17.63 

17.53 

17." 

U.JJ 

152 

13 2.327 

20 1.316 

" II 

.. 

35 

' 17.31 11 2.325 43 

17.10 23 511 11 

16." 30 2J1 12 

lf.lf 36 1.JJO U 

ll .. tt 7.345 ,, 

16 . 01 37 1.16& 31 

1&.1& .. u U.35 33 1.2U 32 

u.n 32 n• 21 

17 . &3 16 1,. 10 

17.31 21 651 22 

17 . 61 12 1.602 39 

11.31 ' 7&2 2& 

15.11 3t 51& 23 

11 . 51 177 27 

13.32 " u 3 

- 18 -

276 

232 

350 

227 

310 

227 

363 

300 

us 

JJO 

&02 

&01 

no 

300 

2&5 

221 

295 

306 

370 

21J 

&13 

315 

310 

220 

JOI 

JU 

200 

2J5 

51& 

339 

&05 

3U 

300 

2U 

HO 

211 

357 

562 

307 

2U 

2J1 

311 

Ul 

210 

906 

3t -3 .o 50 77.6 

11 -21 . 0 

30 -13.1 

' -u.z 

12 -13 . 1 

7 -2.& 

33 -13.8 

' -7.5 

25 3 . 3 

-1.&.8 

35 -13.2 

21 -15.5 

" -7 ·' 29 -1.6 

&0 -5.3 

.2 12.0 

" -1.1 

20 -1.1 

-1&.6 

-1&.0 

17 -12.2 

22 -3.' 

37 6.2 

15 -1.3 

&3 -12.0 

27 -7 .1 

26 -23 . 2 

2 -13.2 

2& 5.0 

36 -13.5 

-17 .J 

11 '·' u 59.& 

31 - 13.1 

&1 7.6 

21 -11.5 

1J -16.2 

10 5.7 

32 10 . 1 

1& 11.& 

3& -5.J 

f.7 -15.7 

23 -20.6 

-& . 1 

1( 3.0 

31 -5.6 

u -12.8 

13 -7.' 

,, 1&.' 

JJ 

50 

2 

16 

' 

18 

H 

12 

26 

39 

15 

8 

25 

35 

JO 

&7 

37 

23 

10 

11 

20 

32 

&2 

36 

21 

27 

1& 

ao 

13 

5 

43 

., 

17 

., 

22 

• &1 

45 

" 21 

31 

38 

29 

1t 

2& 

u 
304 

EHVIROIIKI!NTAL BEALm INDICATORS 

17 18 l9 20 

Stat a Spandin•1 State Budget ED"Yironaent: · Pollution Eaiaaiona PiDAl 

stat• On 'l'he Spent On Policy S®aidy va. To Joba Sc:ore 

Environment EDviromaeDt Jt•cord Iuvear.m.nt Ratio 

$ pIc Rank: % JlanJt Grade llank. .. Rank I Rank 

A1a.l>aaa 

Ala aka 

Arizona 

Arkallaaa 

Califora.ia 

Colorado 

Co.DDecticut 

O.lawar• 

Florida 

CiJeorgia 

Hawaii 

Ydaho 

Illinoia 

Indiana 

Yowa 

lt&J:I.aaa 

Jl:eDtuclcy 

Louiaiana 

Mai.ne 

Nary1~ 

Haaaachuaet.ta 

Kicb.icran 

lli.Ju:leaota 

Kt.aaiaaippi 

Miaaouri 

Nevad.a 

New ButPabire 

New J••:aey 

22 •• 3 

519.79 

15.63 

25 . 66 

"·" 68 . U 

20.98 

63 . 70 

29.30 

:21.69 

34.04. 

81.22 

35.17 

13.98 

23." 

23.16 

28.38 

49.16 

,, . 35 

31.98 

39.08 

23.56 

50.50 

30.U 

50.31 

72.32 

27.89 

46 • .17 

39 .so 

51.85 

New Mexico 35.62 

New York 32.08 

North Carolina 16.96 

Nonh Jl&kota 79.48 

Ohio 16.26 

Okl.&haoaa 19 .12 

Oregon 58.06 

P~ylvania 24.13 

Rbode :r:alaDd •o. 3 a 

South c&roli.Aa 32.92 

South. Dakota 

'l'eDD••·-

........ 

lltab 

veraont 

•s. o2 

22.04 

18.36 

f,3 .95 

89.60 

Virginia 28.27 

Waatungton 78 . 45 

Weat. Virgiaia :ZLOl 

Wiacon•iD 36.75 

-.... 221.20 

•o 

1 

u 

35 

u 

10 

31 . 

., 

26 

25 

50 

37 

39 

32 

15 

16 

29 

2 2 

38 

13 

30 

H. 

J<, 

1 7 

2l. 

"' 

2. 

211 

.. , 

'" 

11 ~ 

H 

20 

27 

18 

H 

u 

l9 

3 

33 

u 

23 

2 

1.02 

s. 79 

o. 73 

1 . 29 

2.38 

3.22 

0 . 62 

1.83 

1.51 

1. 06 

0.84 

3 . 55 

l. 63 

0 . 67 

0 . 97 

1.12 

1.16 

l. 97 

1. 66 

1. 22 

1 . 16 

0.91 

1. 74 

1.51 

2 . 78 

l . tl 

1 . 35 

1.61 

2.05 

l. 70 

1.19 

0.90 

o . 75 

2 . 13 

o . u 

0 . 13 

2 . 21 

1.07 

1.17 

1.27 

2 . 21 

0 . 81 

1.06 

l.U 

2 . 90 

1.31 

1 . 51 

o . 79 

1.f,f, 

5 . 53 

38 

n 

27 

so 

15 

22 

36 

'3 

19 

u 

39 

H 

32 

13 

18 

29 

32 

•o 

16 

22 

8 

25 

20. 

12 

17 

30 

u 

u 

•• 

10 

35 

31 

28 

11 

., 

36 

u 

26 

21 

•s 

,. 

2 

25 . 6 n s9 •o 325 38 681 u 25 . 5 u u2 n 1.2s2 u ss1 31 

3'. 2 35 91 '2 362 39 567 35 

23.1 so u 39 225 35 579 37 

77 •• -u s •s s <23 13 

U.1 25 -51 38 377 

"·' -31 11 60 "2 18 

•o.o 28 -2u 1 102 17 518 2' 

58.6 12 i7 32 186 33 461 20 

39.6 30 -" 1C 116 21 su 30 

., .3 25 -22 15 47 360 

33 . 0 37 2 ,. 167 29 <25 15 

50.6 18 -22 15 126 22 563 3' 

U . 3 " 32 37 230 36 687 47 

H.S 17 30 35 17f, 30 ''1 24 

39.8 29 172 u •o1 (1 

37 

so 

27 

11 

625 

59< 

708 

331 

U3 

" 35.. 33 -·2 9 231 •o 3<1.3 H UO " 2,623 so 

62 . 7 -103 2 160 

55.7 1< -n 6 67 

63.2 -12 20 35 389 8 

59 . 5 10 -11 21 107 18 su 29 

U.6 10 28 108 19 381 

28 .a •3 170 u n3 u 612 u 

•s. 3 23 11 29 150 25 530 27 

33.6 36 283 ,. 2,073 "' 559 33 

•o . 1 21 u 38 155 26 520 25 

28.5 '' 26 13& 23 u• 11 

U.1 22 -7 22 63 310 2 

67 . 8 -77 3 39 "' 21 

32.0 39 65 u 982 46 533 ~· 

65 . 3 6 -27 13 65 10 .,, u 

56 . 7 13 28 33 135 241 578 36 

30 . 0 41 7 26 110 20 458 19 

U . 9 19 -17 17 1U 28 586 38 

32 . 1 31 2t Jf, 209 34 588 39 

67.1 -16 11 92 16 395 

''· ' 20 -31 11 79 13 511 23 

59 . 0 11 -U 8 ,. 397 11 

38 . 3 31 -s 23 112 32 611 f,2 

23 . 6 u 13 30 18 15 396 10 

31.7 tO 1" u U5 C2 698 41 

37 . . 32 u 31 "5 u 703 u 

29.8 412 f,ll so 967 u 556 32 

s• .a 1s -16 11 ,. 1 282 1 

n .o 21 30 . 35 175 31 521 26 

s•. a 1s -19 10 87 1' '30 16 

27.5 415 3 25 370 '0 652 45 

67 . 6 3 -U 75 12 379 

26 . 6 "' 102 43 1.20f. 47 601 41 

- 19 -
305 

Economic Well-Being and 

Environmental Protection in the 

Pacific Northwest 

A Consensus Report by Pacific Northwest Economists 

December 1995 
California 

Idaho 

Montaila 

Oregon 

306 

Economists EndorSing* Economic Weii~Bel~g and Environmental 

Protection in the Padfic·Northwest 

Tim,othy D~ane, City and Regional Piiudting; U. Calif: Berkeley 

Sieve Hackett; School of Business & EConomics, Humboldt Siate u . 

William Stewart; P~cific lnStituie, Oilkland, Calif. 

Gerald F. Draayer, EConomicS, Boi~e State University 

Ji>e11:1amilton, Agricultural Economics, Universiiy of Idaho 

Don Readirtg, Ben Johnson Associates, Boise; Idaho , · 

Larry Reynolds, Economics, Boise State University 

Gundars Rudzitis, College of Mines _and Earth Resources, Univ. of Idaho 

Charles L. Skoro, Economics, Boise State University 

Tesa Stegner, Economics, Idaho State University 

Robert Tokle, Economics, Idaho State University 

Richard Barrett, Economics, University of Montana 

John Duffield, Economics, UM and Bio-Economics 

David Jackson, School of Forestry, University of Montana 

Alan McQuillan, School of Forestry, University .of Montana 

Thomas M. Power~ Chair, Economics, University of Montana 

Ronald L. Trosper, Confederated Salish & Kootenai Tribes 

Northern Arizona University, School of Forestry 

Emery Castle, ·university Graduate Faculty ofEconorriics, 

Or~gon Staie University . 

C Russell Beaton, Economics, Willainet~ University 

Tom Can·oll, Central Oregon Community College 

Zena Cook, Economics, Portland State University 

Richard M. Davis, Economics, University of Oregon 

David N. Figlio, Economics, University of Oregon 

Eban Goodsteifl; Economics, Lewisand Clark College 

James S. Hanson, Economics, Willamette University 

Thomas H. Hibbard, Economics, Willamette University 

Mike Katz, EConomics, Portland State University 

Joe Kerkvliet, Economics, Oregon Siate University 

Van Kolpin, Economics, University of Oregon 

Patricia J. Lindsey, Dept. of Ag & Resource Economics, 

Oregon State University 

Raymond F. MikeSell, Economics, University of Oregon 

Donald H. Negri, Economics, Willamette University · 

Ernie Niemi, ECONorthwest, Eugene, Oregon 

Art O'Silllivan, Economics, Oregon State University 

·stephen Polasky, Dept. of Ag & Resource Economics. 

Oregon State University . 

Philip J. Ruder, Pacific University · 

H. Joe Story, Dept. of Business/Economics, Pacific University 

R. Charles Vars, Jr., Economics, Oregon State University 

Ed Whitelaw, Economics, University of Oregon 

Helen Youngelson-Ncal, Economics, Portland State University 

hm('C: p ?ili'llr f:rnn nmi r·c: 'lnivt>rc: it v n f nr,.onn 
307 

· Economic Well-Being and Environmenta:l Protection · .. 

in the Pacific Nortr 

Execiltivf! SlliiUII8I"J 

By almost. any m~ure of economic vitality; Jhc four states of the Pacific Northwest-Idaho. 

Montana, Oregon, and Washington--have been remarkably healthy and vibrant over the past 

decade. For example, between ·1988 and 1994: · ' 

• The number of jobs in the region increasoo by 940,000 or 18%. 

• Total personal real income of the region's hoilseholds increased by $42 billion . · 

or24%. 

• Total real earnings of the region's workers increased by $28 billion or 24%. 

• The average real inco~e of the region's residents increased $1,750 or 9%. 

For each of these variables, the growth in the Pacific Northwest was two to three times the 

national rate, and economic projections for the region indicate that growth in jobs and incomes 

in this region should continue to outpace the rest of the nation for the foreseeable future. 

Although some areas will see much more growth than others and sbme will struggle to maintain existing levels of economic activity, vinually all communities within the region will enjoy 

some of this growth. The current cyclical slowdown in the national and regional economies 

should ~ot'be allowed to obscure these impressive performiiJ!ces.and optimistic forecasts. 

Despite this exceptionai performance, many residents feel uneasy about the regional economy 

and havt; the impression that it is about to collapse. Some are urging Iocai, state, and national 

leaders to take corrective action. But action to correct a nroblem that does not exist can do far 

more harm than good . . 

The net result is that the region is successfully navigating from 

being dependent on a few extractive industries to having a 

modem, widely diversified economy~ 

. This consensus report, supported by over thirty economists from all five Pacific Northwest 

states, attempts to clarify what is happening in the regional economy. It also offers guidance to 

workers, holiseholds, students, firms, and communities about how best to take advantage of the 

region· s economic strengths. 

Both the region's strong economic performance and a significant part of the unease that is felt 

by the public stem from the same origin: Tlu economy of the Pacific Northwest u undergoing a profound transition. During the last decade the industries once central to the region's 

economy-aerospace and the natural-resource industries (agriculture, timber, fiShing, and 

mining)- have experienced significant declines and have eliminated tens of thousands of 
308 

. . 

value-added activities which increase jobs without similarly increasing the level of resource 

extraction. Overall, the new jobs outside of the historic extractive base have paid high enough 

wages for real earnings per job to rise almost four times as rapidly as in the nation as a whole. 

In sho11, the PacifiC NorthWI!St does not have to choose between job$ and the environment. 

Quite t,,; opposite: A healthy environment is a major stimulus for a healthy economy. 

This is not to say that protecting the region's environmental advantages will be without cost, •. 

for-both money and political will aie required to prevent environmental degradation harmful to 

the economy. Such harm occurs whenever the region's natural resources are allocated to low-. 

value uses when protecting and enhancing them has a higher value. An equally potent thieat 

comes from growth itself, which can over-Whelm the environment with inore people, congestiOil, and urban sprawl. If the residents of this region wimt a healthy eeonomy, they wiD 

have to make the economlc and political investments necessary to guard against both 

types of environmental degradation. 

Protecting the environment, by itself, cannot ensure that everyone in the region has a bright 

future. As in the rest of the nation, workers in this region with lower levels of education, -

experie:nce, and skill are seeing their earnings shrink relative to those with higher levels of 

education, eXperience, and skilL The workers being harmed by the transformation of the 

economy are those whose skills and work experience are not easily transferred to the new 

The-pain of the lost jobs should not obscure the 

new jobs that are being created. · 

expanding sectors of the economy. As a result, the transition for them and their communities is 

disruptive and painful. Tbese negative consequences of the economic transformation should 

not be trivialized or ignored. But these consequences cannot be avoided by trying to tum back 

the economic clock. The pain of .the lost jobs should not obscure the new jobs that are being 

created. The best way to help those at risk of being left behind aS the region's economy· 

develops is to help individuals and communities acquire the capability and flexibility to 

take advantage of the opportunities that are being generated in !he new economy. The 

winners in our increasingly risky economy need to assist those disadvantaged by the changes 

to successfully negotiate the transition. 

This consensus statement on Economic Well-Being and Environmental Protection in the . 

Pacific Northwest is the product of a two-day meeting in Portland during the summer of 1995 

of about two dozen regional economists. At that meeting a subcommittee was asked to work 

with the transcripts of the meeting to prepare a statement for public distribution. Several drafts 

were circulated among regional-economists and from that review process emerged this statement and its endorsements. No attempt was made to maximize the number-of endorsements, 

only to show the broad geographic distribution of support. 

For more information contact T.M. Power, Economics, Univenity of Montana, Missoula, MT 59812 

Phone: 406/243-4586 Fax: 4061243-4076. 

iii 
309 

Economic Well-Being and Environmental Protection 

in the Pacific Northwest 

1. Introduction: What's Really Happening to the Economies of the 

Pacific Northwest? 

By most indicators, the economies of the Pacific Northwest states have consistently outperformed the rest of the nation over t11e past decade. Employment, earnings, and population have 

all grown at rates two to three times the national average. And, although there may be temporary setbacks now and then as the regional and national economies move through normal 

business cycles, the Pacific Northwest should continue to outperform the rest of the 

nation for the foreseeable future. 

Despite this rosy economic outlook, however, many residents of the Pacific Northwest feel 

anything but positive and confident about the economy upon which they rely. There is a 

widespread feeling of unease and insecurity about the changes taking place within the 

economy and the impact those changes will have on residents' ability to provide for themselves and their families. 

These feelings of economic insecurity are understandable. Nationwide, the economic news is 

regularly disconcerting: Workers in nonmanagementjobs continue to see the purchasing 

power of their wages decline. National corporations repeatedly announce wide-scale layoffs, 

elimina~ng thousands of familiar, high-paying jobs. There is a pervasive perception that, 

although some elements of the economy are prospering, the negative impacts on families, 

communities, and the environment threaten the traditional fabric of American life. 

The Pacific Northwest should continue to outperform the rest of 

the nation for the foreseeable future. 

In addition, there have been significant changes within the economies of the Pacific Northwest 

states that contribute to a sense of foreboding. The historically important natural-resource 

industries, including timber, agriculture, fishing, and mining, have been contracting. Other 

major components of the economy, such as aerospace firms, are also shrinking with the end of 

the Cold War. Many fear that these changes will lead to the collapse of jobs, families, and 

communities. 

The combination of these national and regional changes in the economy leave residents.uncertain and fearful about the economic future and lead them to view the recent economic past and 

present in relatively bleak terms. As a result, the relatively impressive performance of the 

regional economy over that past half decade tends to get ignored and the very positive projec24-936 96 - 11 
310 

The other states' performances, however, have not been "shabby." The "worst" performances 

(Oregon and Montana) had employment growing at a rate "only" 2.2 times the national average and real earnings climbing at a rate "only" 2.5times the national average. 

For the region as a whole, total personal income, which includes dividends, rent, interest, and 

retirement income as well as labor earnings, grew at a rate 2.2 times the national average after 

adjusting for inflation. Real earnings by themselves grew almost three times faster. Real per 

capita income improved at a rate over two times faster as did employment. Population also 

grew at twice the national rate as the region drew new immigrants from across the nation. (See 

Table 1.) The accompanying graph pro~ ides a visual picture of the superior performance of 

the regional economy in terms of generating both jobs and earnings. 

Table 1 

Measures of the Vitality of the Economies of the Pacific Northwest States 

State Employment (88.94) Pmonallncome (88·94) Average Income (88·94) Earnings (88-94) Population (90-94) 

change State/US change Stale/US change State/US change State/US change State/US 

ID 27.7% 3.6 31.5% 2.8 14.4% 3:3 34.5% 3.9 12.0% 2.7 

MT 17.0% 2.2 18.7% 1.7 10.9% 2.5 22.6% 2.5 7.0% 1.6 

OR 17.0% 2.2 22.6% 2 8.5% 1.9 20.3% 2.3 8.0% 1.8 

WA 17.2% 2.3 24.4 % 2.2 8.0% 1.8 24.0% 2.7 9.0% 2.1 

FNW 17.9% 2.4 23.9% 2.2 9.1% 2.1 :23.8% 2.7 8.8% 2 

us 7.7% 1 11.1 % 1 4.3% 1 8.9% 1 4.4% 1 

Sources. lJ..S. Buuau of EconomiC Analys1s, R.~g10na/ EconomJC ln[orma110n Sysr~m./ncome data convuted ro 1994 $s usmg the CPl. 

Economic Vitality: Pacific Northwest v: US 

1.25 

0 

~ 1.2 

Co 

CX) 

CTI 1.15 

cu 

Cl 

c 

.r::. "' 1.1 (.) 

-

0 

)( 

Ill 

"C 1.05 .s 

Year 88 89 90 91 92 93 94 

3 
311 

There are important lessons here regarding the resiliency and diversity of the regional 

economy. In particular, it is apparent that the economlcfate of the entire region no longer 

rests solely, or even predominantly, on these two industries. The regional economy is more 

balanced; diversified, and resilient than implied by the common description ofit as a "natural 

resource eConomy" ihreatened by loss of ac.cess to raw materials, 

This superior economic, performance during the last decade, despite declines in industries that 

historically were the centerpiece of the regiollal economy, should not be looked upon as a 

temporary "fluke" that will be reversed in time. The economic forecasts devi:loped by each 

state for the coming years iltdicate that jobs and incomes in the region should continue to grow 

faster than in the rest of the nation, despite ongoing declines in forest products and aerospace. 

(See Table 2.) Growth may be slower than in the recent past, however, primarily because the 

recent, almost explosive expansion may not be sustainable over a long period of time. A recent 

Oregon forecast suggests that labor shortages and rising labor costs may slow the rate of 

business expansion (Oregon Department of Administrative Services, 1995, p.l6).1t is important to note that this problem is one caused by workers not moving to the region fast enough 

rather than a failure of the economy to create sufficient job opportunities. There also are 

indications, however, that growth in the high tech sectors in Washington and Oregon is continuing at a high rate. 

Table 2 ' ; Summary of State Government Economic Forecasts 

Pacific Northwest States 

J 

State Employment Reallncome 

Growth Growth 

Idaho 3.3% 3.9% 

Montana 1.5% 1.0% 

Oregon. 3.0% 3.7% 

Washington 2.0% 2.9% 

PNWStates 2.4% 3.1% 

United States 1.6% 2.4% 

PNW/US 1.5 1.3 

Sourc~s: Washington Economic and !ln'l'nu~ Fortcast, Junt, 1995 

Oregon Economic and Rtvtnut Fortctist, Stpttmber, 1995; 

Idaho Economic Forecast; July, 1995; 

Economics MontantJ, BBER, U ofMT, Spring,1995. 

5 

Forecast 

Period 

1995-1998 

1995-1997 

1995-1996 

1995-1997 

1995-1997 

1995-1997 

1995~1997 
312 

distinguishing feature. Further to the east, the high desert and the Northem.Rocky Mountains, 

with their rivers,lalces, and forests, identify a region of world class. recreational opportunities 

and scenic beauty. The region retains a good part of its natural pristine character and Is rela~ ' 

tively uncrowded ~om pared tO other areas: These ef1Viro~ental features are not just aesthetic . 

q·ualities that are nice but of litpe economic importance: They are 8Jso one source· of the economic vitality of the ~gion because of the5e two basic economic facts: . 

• Many j>eople move to this region, and remain here, because they want to enjoy its 

high-(Juality living environment 

• That growth in population stimulates the development of new businesses and the 

expansion of existing one§. 

Of course, economic causality does not run just one way, with migration stimulating job 

creation. Job creation also stimulates immigration. A complex dynamic process has been 

triggered in the region. One part of that dynamic process seems to be clearly tied to the 

region's amenities. 

In short, one of the reasons jobs and incomes in the PNW are growing faster than elsewhere in 

the U.S. is because the region's population is growing faster, and the population is growing 

faster because many people believe that this is a wonderful place to live, work, and raise 

a family. The attractiveness of the region assures an adequate and attractive labor supply and 

growing markets for goods and services. The result is that economic activities, investment, 

firms, jobs, and incoines are shifting from other regions to the PNW as workers and households 11\igrate .to this region in pursuit of preferred living environments. · · 

The region is perceived as providing a superior, attractive 

environment in which to live, work, and do business. The natural 

environ~ent appears to be especially important. 

Thus. the transition in the economy of the PNW is being partially driven by the interaction of 

two important factors. One is that, in a society where people are more mobile than ever, large 

numbers of people want to live in this region and, hence, many more move to this region each 

year than move out of it. The other is that, as transportation and communication costs decline 

and industiies foc~s more and more on the production of value-added goods and services, 

industrial activity is increasingly footloose, i.e., it can locate almost anywhere. In. other words: 

"[T]here is less 'stuff in the stuff that we buy today. Wood products, for instance, 

used to mean plywood and dimensional lumber [but today] less of the total value 

of the product comes from wood and more of the value comes from engineering .. 

And that engineering can happen almost anywhere. In short, less of the value of our 

goods comes from the raw materials and more comes from intellectual activity. 

This shifts regional economies away from natural resource bases toward human 

resource bases. As our old ways of explaining regional economic activity will 

7 
313 

A lnge nOOtber or the new jobs pay wages higher than those In the natUral-resource 

Industries. In Oregon, for instance, the average annual wage in 1993 in the high tech sectors 

was iwnost $40,000 while, by contrast, the average annual wage in the lumber-and-woodproducts industry was about $28,000. Just as important, while the pay associated with high 

tech and services has been rising, the real annual wage associated with lumber-and-wood 

products has been falling steadily, from $36,000 in 1978 to $28,000 today. In many respects, 

~eJumber-and-wood products indtistiy no longer is a high-wage industry: Where wages in the. 

industry once were ·40 percent higher than average wages, they now are only 15 percent higher 

and tliis differential may largely reflect the industry's greater risk of injury. [Oregon Employment Department, March, 15, 1995] 

It .is not only high tech manufacturing that.is creating relatively high paying jobs. Soine of the 

fastest growing service sectors-business, legal, and medical services:-also pay higher than 

average wages, and so do other sectors, such as wholesale trade, that are expanding as a result 

of the transition in the regional economy. Over the last decade, for the region as a whole, 

earnings per job have been growing at almost four times the national rate and average 

incomes have been growing over twice as fast as the national average. ' 

c. Responding to Economic Disruption and Dislocation 

The shift in this region's economy, away from natural-resource industries and to industries 

whose prosperity depends on the region's attrjlctive environment, has been painful to many 

households and communities, especially in some nonmetropolitan areas. Workers have lost 

jobs, families have lost incomes, local governments have lost revenue and curtailed services; 

and communities have lost their sense of history and stability. We encourage all the citizens of 

this regjon to support meaningful efforts to mitigate the economic and social distress that 

accompanies the closure of a sawmill, the termination of a commercial fishery, or the exhaustion of a mine's ore reserves. 

We encourage all the citizens of this region to support meaningful 

effo$ to mitigate the economic and social distress that 

accompanies the closure of a sawmill, the termination of a 

·commercial fishery, or the exhaustion of a mine's ore reserves~ 

It is important to realize, however, that proposals to reverse the economic transition, such as 

those that call for blanket increases in timber harvests from federal lands, with disregard for 

the overall environmental and economic impacts, offer little meaningful relief to· those who are 

enduring much of the cost of the transition, and, in the end, they are likely to do more harm 

than good. The quality of this region's natural environment has tremendous economic value 

and is oneof the driving forces behind the growth in jobs, incomes, and industrial diversification. Policies and actions that significantly diminish the natural environment may 

threaten this region's economic future and should be undertaken only arter careful 

deliberation shows that they are worthwhile. 

9 
314 

and skin· faster than workerS are comp!eting School and acquJrlng Ch~ skills. The resulting intense compe!ition for highly splled workers has 'raised their real wages while wages for 

those with le.ss education and lower skills are declining. nie result haS been increasing inequiw.ty among workers (Bound and Johnson, 1995). This is of particular concern in some of 

·the natural-reSource industries where, in the past, workerS with belpw-average levels of education could earn above-average wages. As those jobs are eliminated some of the dislocated 

workerS wiiJ fri_ld itdifficult to qualify-for new jobs in other mdustries paymg comparable . wages. · · · · · · · · ·. · 

The high levels of in-migration into the region can compound the problems for existing residents· who have lost their jobs.· The in-migrants tend to be more highly educated and have more 

work experience. Their very migration represents a self-selection of the more confident and 

competitive job seekers; As a result, even within an Oiigoing employment and population 

boom, unemployed exiSting residents may find their employment difficulties made worse. 

That, for example, appears to have been the case in Oregon as the number of workers exhausting their unemployment benefits rose significantly during the employment boom of the early 

1990s (Oregon Labor DepaJ1!nerit, 1993 and 1994). The lesson here is a strong one: Current 

residents of the region will enjoy fully the benefits of the economic transition that is taldng 

place here only if they obtain more education and training. If the individuals, families, communities, and the states of this region fail to make efficient, effective investments in education; 

they also wili fail to keep pace. · 

4; Envlronmental Protection and Economic Performance in the PNW . . 

. . . ' 

I ·. . , . . . 

No other region has a longer, more intense history of controversy over the economic impacts 

of environmental protection. Our history of environmental conflict shows that the'impacts of 

protection are many, some positive and some negative, but our strong economic performance 

over the past decade clearly indicates that, overall, the net effect has not been negative. Re-

·Versing these efforts to protect our environment could impose serious economic harm on 

the region. This is not to say, however, that the region· has approached the issues of environmental protection and economic development in an efficient manner. The region can do better. 

' . ' . 

. a. The Causes of Job Loss in .the PNW's Natural Resource Industries 

Because jobs in the natural-resource industries h·ave declined at the sanie time that there have · 

been bitter battles in the region associated with protecting endangered species (owls, salmon, 

caribou, grizzly bears, wolves, bull trout, etc.), it has become-commonplace to assume that 

environmental protection necessarily caused all of the Job loss. This represents a serious 

miSunderstanding, both within the t;egion and across the nation. For reasons that have little 

to do with .environmental protection, all of ihe industries that historically made up the region's 

economic base have been in relative or absolute decline as.sources of jobs and iricome. All of 

the natural-resource industries-agriculture, fishing, mining, and timber-are mature industries where technological developments have dramatically raised productivity and reduced 

11 
315 

Given that employment in the PNW has grown considerably faster than the nation~ average, 

at the same time that the region experienced widespread injunctions affecting the management 

of forests, water, and other resources, it seems unUkely that these environmental protection 

measures have had much negative impact on overarremployment growth in this region. 

c. The Employment Impact of Environmental Quality 

Except where environmental regulation is grossly inefficient and ineffectual, it yields benefits 

as well as costs. The most obvious benefits are the improvements in the living environmenL 

As discussed earlier, the higher quality living environments in the PNW have been one of the 

driving forces behind its economic vitality. Because people care where they live and because businesses care where people choose to live, environmental quality has a po5itive 

impact on the local economy. Put negatively, degraded environments are associated with 

lower incomes and depressed economic conditions (Templet and Farber, 1994; Been, 1994; 

Meyer, 1992 and 1993). 

Given that the region's recent economic vitality is partially tied to its comparative advantage.ir 

environmental quality compared to both Southern California and other of the nation's more 

degraded environments, protection .of that advantage through efficient environmental regulation is likely to have positive net impacts on regional economic well-being. 

d. Being Clear: What We Are Not Saying 

Although we believe that the points we make above represent sound conventional economic 

analysis and judgment, nonetheless some of the points may be perceived as controversial, or 

even pa~san. Hence, it is important that those points not be misinterpreted. 

We are not saying that the natural-resource industries (agriculture, timber, fishing, and 

mining) are not important to the regional economy. Natural resources industries are still 

important in the PNW and will remain so into the foreseeable future. The point we have tried 

to make is not that they are unimportant but that increased volumes of material extracted are 

not likely to be sources of expanding employment and income. That is an important distinction. In the region's rural areas there are many communities that are highly dependent upon 

Our economy is in transition and the pace of the transition, 

if anything, will accelerate. 

our natural resource industries. But even there, it is important to realize that additional income 

and jobs will be generated in the future in new value-added natural resource activities or 

outside the traditional natural resource industries altogether. It is for that reason that most of 

those communities are already searching for ways to diversify their economies away from sole 

reliance on the volume of natural resources extracted. 

13 
316 

6. Efficient and Effective Environmental Protection: Working with Economic Incentives and Protecting Everyone's Property Rights 

To point out that high-quality living environments contribute to economic well-being and to 

local economic vitality is not to suggest that one should be uncritical about how the region 

pursues that high-quality environment. In particular,lt Is not a blanket endorsement of all 

current environmental regulation nor support for the proposition that environmental 

protection can only be had through the command·and-control approach that has dominated many regulations. Recognizing that environmental protection can enhance our -

economic welfare Is important but just a flrst step. We need to develop innovative and imaginative approaches that modify the: incentives we face and encourage environmentally benign 

private decision making. Bottle-deposit Jaws and other recycling incentives are examples of 

this approach. Complex government regulation is only one tool among many to be considered 

and often not the best tool. 

Recognizing that environmental protection can enhance our 

economic welfare is important but just a first step. 

Nor does p11rsuit of a high-quality environment necessarily imply that private property rights 

have to be weakened. Environmental regulation often involves conflicts between two parties, 

where l!ach is seeking to protect or enhance the value of his or her property. In that sense, 

environmental regulations enhance property rights by specifying how conflicting rights are to 

be settled. For instance, where. manufacturers' air and water discharges threaten the health and 

property values of adjacent residents, having Jaws that clearly limit the damage one property 

owner can impose on another's property cannot be said to weaken property rights in any way. 

Good environmental policy seeks to resolve conflicts over property rights and to clarify the 

rights of all concerned. 

When one's property rights are clearly specified and understood, those rights are all the more 

valuable. Indeed, a fundamental role of government in our society is to specify and protect the property rights of individuals. Government also enhances property rights and values 

in other ways, for example by making investments and providing services in situations where 

public action appears tQ be the most efflcient mechanism. Many believe that the government 

acts in a similar manner when it seeks to protect an ecosystem, prevent the extinction of a 

species, or accomplish other. environmental objectives. Others, however, urge less reliance on 

government regulation and a heavier reliance on markets and incentives. We do not take a 

position on this issue other than to offer these two observations: 

• Attempts to impose a one-size-fits-all resolution of this Issues is unlikely 

to be either efficient or equitable. For instance, enacting laws saying that 

governments must compensate all private property owners adversely affected 

by any environmental regulation, even when failure of the government to act 

15 
317 

about whether or how to harvest _timber fail to consider the costs imposed on valuable downstream flsheries. 

The othe~ threat to th~ region's economic vitality comeS from the very forces that underlie it 

Jobs and incomes in this region are growing partly because the region'samenities attract and 

hold people who ftnd the environment attractive. But pOpulation.growth eventually can 

overwhelm the environment with congeStion and environmental degradation that destroys the very amenities that coiltributecfto groWth In the first_ place. · 

The residents of this region must guard against both of these threats if they are to realize 

sustained prosperity. They will have to avoid squandering the high-quality characteristics of 

the environment in an effort to insulate the region's historically important natural-resource 

industries from the realities of today's economy. They also will have to put significant effort 

into managing the environmental impacts of future population growth. 

The risks associated with the· ongoing economic change are real, but, so are the opportunities 

being created. Many in the region bear a disproportionate economic and social cost as others 

enjoy a disproportionate share of the beneflts. For the most part, this inequity is occurring, not 

because one group is maliciously taking advantage another, but because of changes in the 

Consequently, those who are prospering from the transition have 

an obligation to assist those who are bearing the costs. 

regional, national and international economies that are ongoing and. unavoidable. The existence of d!e inequity creates risks for everyone, however, because it gives those disadvantaged 

by the changes powerful incentives to oppose and undermine the economic transition that is 

underway. Consequently, those who are prospering from the transition have an obligation to 

assist those who are bearing the costs. · 

There are other risks as well. One is that individuals, communities, and political leaders may 

fail to recognize the realities of the new economy and fail to equip themselves for the transition. As employment in historically important resource-extraction industries in the PNW 

continues to shrink due to forces driven by the global economy, workers whose skills are 

specillc to those industries will be increasingly vulnerable. The best way to secure prosperi~y 

for these workers is for them, their communities, and the. region to· iilvest in efficient and 

effective education and training programs. 

Political forces, even powerful special interests, cannot bring back. the economy of a past 

era. The unique natural resources of the Pacific Northwest remain among its most 

important economic assets. But the new jobs and income that are vital to the region's 

economic future will depend more on the protection of those assets than on their 

degradation. 

17 
318 

Citations 

Been, Vicki. 1994. "Loeally Undesirable Land Uses in Minority Neighborhoods: Disproportionate Siting or Market Dynamics?", Yale Law Journal; 103:1383. 

Beuter, Johri H., K Norman Johrison, and H. Lynn Scheurman. 1976. Timber for Oregon's 

Tomorrow: An AnalysiS of Reasonably Possible Occurrences. Oregon State University, 

Forest Research Laboratory. January. 

Boeing Corporation. 1995. Unpublished historical employment data. 

Bound, John and'George Johnson. 1995. "What Are the Causes of Rising Wage Inequality in 

the United States?" Economic Policy Review. New York: Federal Reserve Bank of New 

York. -

Conerly, William. 1995. "The Death of Regional Economics." Pacific Northwest Economic 

Indicators, 4(3), June/July, p.9. 

Corporation for Enterprise Development. 1995. The 1995 Development Report Card for the 

States, 9th Edition. Washington DC: Corporation for Enterprise Development. 

First Interstate Bank. 1995. Pacific Northwest Economic Indicators. 4(3), June/July. 

Goodstein, Eban. 1995. Jobs and the Environment: The Myth of a National Trade-off. Washington DC: Economic Policy Institute. 

Harris, Cliarles C., Jr. 1995. An Assessment of the Social and Economic Characteristics of 

Communities in the Interior Columbia River Basin. Eastside Ecosystem Management 

Project, U.S. Forest Servic(~. Walla Walla, W A. 

Idaho Division of Financial Management. Idaho Economic Forecast. 17(3), July. 

Johnson, Kenneth M. and Calvin L. Beale. 'The Recent Revival of Widespread Population 

Growth in Nonmetropolitan Areas of the United States." Rural Sociology 59(4): 655-667. 

Judson, D.H. 1993. The Oregon In-Migration Survey. Oregon Research, Tax, and Analysis. 

November. · 

Meyer, S. M. 1993. "Environmentalism and Economic Prosperity: An Update." Department of 

Political Science, Massachusetts Institute of Technology. 

Meyer, S.M. 1992. "Environmentalism and Economic Prosperity: Testing the Environmentlil 

Impact Hypothesis." Project on Environmental Politics and Policy. Massachusetts Institute 

of Technology. 

Montana Bureau of Business and Economic Research. 1995. Economics Montana. Spring. 

Montana Department of Labor and Industry. 1995. Montana Annual Planning Information. 

June. 

18 
319 

The Impact of Endangered Species Listings on Home Building and 

the Real Estate Industry 

Summary 

The harmful ecor omic effects of the Endangered Species Act are epitomized by the listing of the 

Northern Spotted Owl. which drove up timber prices significantly and subsequently increased the cost of 

new single family homes across the nation. 

This is the National Home Builders Association's core indictment of the Endangered Species Act. 

A cursory glance at the data on Douglas Fir (the primary Pacific Northwest tree species used in home 

construction) production and prices would seem to support this assertion. 

Between 1988 and 1994 Pacific Northwest production of Douglas Fir dropped from 10 billion board 

feet (bbf) to about 7 bbf- a 30% decline. During the same period the stumpage price for Douglas fir rose 

from S260 per thousand board teet to $650. 

The average single family house uses about 10.000 board feet of lumber. So one could estimate 

that the increase in Douglas Fir stumpage prices would add between $5000 and $8000 to the price of a 

new house. assuming ihat other construction lumber prices rose proportionately and that the framing 

lumber cost was about twice the l imber stumpage price. A 1993 National Home Builders Association ad 

claimed that the Spotted Owl listing added about $5.000 to the price of a new home. 

A more C<Jreful and serious look at the very same data, however. demonstrates that the Spotted 

Owl listing was merely coincidental to the rise in timber prices, as was the collapse of the Soviet Union. It 

appears that the Endangered Species Act listing served as a politically convenient explanation for what was 

a more fundamental market phenomenon. 

FIGURE 1 compares Douglas Fir production and new single family home construction for the 

period 1975-1994. The decline in Douglas Fir production post-1988 is clearly evident. However. when 

viewed in the ccntext or the longer time line it is clear thai the observed decline was only part of a repeating 

boom-bust cycle in timber production- a cycle tied intimately to the rate of new home construction. 

The data show that throughout the period Northwest timber production rose and fell dramatically 

and systematically as a function of new home construction. A full cycle seems to average about eight 

years. When housing construction crashed between 1978 and 1982 so did Pacific Northwest timber 

production, dropping 35%. As housing construction began to recover after 1983 Douglas fir production 

rose in synchrony, with a two year lag. Then the 1990 recession hit. the new home market collapsed. and 

demand for Douglas Fir dropped. Timber production fell accordingly. What this shows is that the "impact" 

of the Spotted Owl listing on Pacific Northwest timber production. to the extent there is one. is dwarfed by 

the more fundamental market relationship between timber supply and demand. 

Moreover the data also show that Northwest timber production peaked at an all t.ime high between 

1987 and 1989. The subsequent production decline in the early 1990s. therefore, yielded a grossly 

exaggerated impression of an industry in collapse. 

FIGURE 2 compares the growth in median single family home prices against Douglas Fir prices. 

As shown home prices are not significanlly affected by the cost of.timber from the Pacific Northwest. When 

Douglas fir prices fell 70% (current dollars) in the early 1980s home prices rose about 25%. When Douglas 

fir prices stayed Oat during the mid 1980s home prices rose by almost 40%. And as· Douglas fir prices 

almost doubled in the latter half of the 1980s home prices rose 15%. In other words. home prices riseand rise significantly - regardless of the magnitude of the rise or fall in the cost of Pacific Northwest timber. 

Two related observations are worth noting. First. in constant dollars Pacific Northwest timber prices 

today are no higher than they were in that late1970s. So one IS left to wonder how thiS translates Into real 

cor1struction cost increases. 

Second, as shown in FIGURE 2 Douglas fir prices began to climb in 1986. well before the listing of 

the Northern Spotted owl and at a time when Pacific Northwest timber production was reaching record 

levels. From the curves in FIGURE 1 it is clear that this steep rise i timber prices was driven by the housing 
320 

indust,:Y's demand for lumber, a demand ihat greatly, outpaced timber supply. The near doubling or Pacific 

Northwest timber prices between 1987and 1989 and the continued demand-side pressures would have led 

one to forecast the early 1 990s price jump in Douglas Fir prices regardless of the Spotted Owl's status. we 

also see that, as in the 1980s. the collapse of the housing industry in the early 1990s drove down the 

demand for Douglas Fir. 

Lastly, FIGURE 3 compares prices fluctuations for Douglas Fir and White Pine -a primary 

construction timber. Quite plainly the two price series have nothing in common. White Pine prices are 

insensitive to Douglas Fir prices reg<lrdless of how much the latter fiuctuates In fact White Pine stumpage 

prices held steady until 1 993-1 994 when bad weather affected timber harvests in the southeast producing 

a supply shortfall just as the home building industry was coming out of the recession. The weather-related 

price jump in white pine lumber may have added to home building costs, but it is obvious that the Spotted 

Owl listing was irrelevant to that price rise. 

One important observation from the data refiects on the sorry state of anti-Endangered Species Act 

rhetoric. Today a !;lout 7 billion board feet of Douglas Fir is being harvested from the Pacific Northwest. This 

is about 15% more than was cut a decade ago prior to the owl listing and still represents only a portion or 

the total timber harvest from the reg on. Yet on March 13, 1996 Texas Senator Kay Bailey Hutchinson 

stood on the fioor of the US Senate and remarked: • ... There is no reason for people in the Northwest to 

have the entire timber industry shut down because of the Spotted Owl." 

In sum, we see that housing construction rates drive long-standing cycles of production and prices 

in Paci foc Northwest timber. There is no evidence that the listing of the Spotted Owl had any demonstrable 

impact on timber prices or that the price of Pacific Northwest timber had any measurable effect on home 

prices. The data strongly indicate that the growlh on home prices would have grown at exactly the same 

rate even if the Spotted Owl had ne•1er been listed. 

The Accumulation of Endangered Species Listings Has Seriously Eroded Private Property Values by 

Preventing Best Economic Use and Development of Land 

If implementation and enforcement of the Endangered Species Act is trampling property rights 

(preventing property owners from maximizing economic value) and consequently gutting property values as 

severely as the rhetoric of the property rights movement suggests, then we should be able to find clear 

traces of the effect tied to accumulating species listings. In particular states with the largest numbers of 

listed species should exhibit the most severe drag on real estate values. 

A strong and cons istent indicator or real estate value growth (or loss) across the states is the 

change in the component or the gross state product derived from services in the real estate industry. Since 

the real estate industry works by commission as a percentage of the property sale value growth (or decline) 

in industry revenues will tend to refiect property value shins over time · 

The graphs in FIGURE 4 depict the relationship between the number of listed endangered species 

and the growth in real estate industry performance by state. Three five-year periods are compared 1975-

1980; 1980-1985; and 1985-1990. The vertical axis on each graph corresponds to the (adjusted) five year 

average annual growth in the value of real estate industry goods and services. The horizontal axis 

corresponds to the (adjusted) number of endangered species listings. (The numbers for species listings 

are transformed counts and therefore are not simple positive inlegers.) 

These graphs are a special form of scatter plot that show how the two variables move together after 

taking into account (compensating for) differences among lhe stares in terms of land area, population and 

economy size, percent of economy in extractive industries. urban population, an.d region. In other words, 

both axes are adjusted (using standard regression techniques) to remove the effects of these ·confounding 

influences. 

If endangered species listings systematically harm real estate values then we should see a pattern 

moving from the upper left of the graph to the lower right The states with the fewest listed species should 

have the most vibrant real estate industries (upper left). The states with the largest number of specoes 

should have the poorest performing real estate industries (lower right). 
321 

.::··This is clearly not the case for any of ihe graphs. The data for the period 1975-1980 Sh(,w:-a 11ai . line. There does not appe« to be any systematic relationship. This is n migllt be expected since during · 

the first half decade of !he Endangered Species Act !he relative number of $1)8Ciea listings was small and · 

implementation and enforcement of the Endangered Species Act were restricted to public lands. 

However, the two graph$ for the subsequent periods show a positive re/ation$hip. Larger numbers 

of listed species are associated with better real estate industry performance. Comparing the three graphs 

we find that as the total number of listed species accumulates the association with better real estate 

industry performance gets more positive and stronger! (See regression tables at the end). 

The results are easily interpreted: states with exploding populations, dynamic economies. alicl as a 

consequence powerful real estate markets putting increasing pressure on wildlife habitats. This increases 

the likelihood of new species listings under the Acl. Thus, endangered species listings are not driving the 

real estate market down, but rather the real estate market is driving endangered species listings up without 

any apparent braking effect on the former. 

1 · 

1 County-level studies in TelCis and the West have reached similar conclusions. 

24-936 96-12 
322 

Figure 1: Douglas Fir Production & New Home Construction 

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323 

Figure 3: Douglas Fir & White Pine Prices 

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!Figure 4: Impact of Accumulating Endangered Species Listings 

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325 

An Analysis of the Impact of the 

Endangered Species Act on Texas Rural 

Land Values 

by 

Charles E. Gilliland 

Associate Research Economist 
326 

Table of Contents 

Executive Summary ..................................................................................................................................... 1 

Statement of the Problem ........................................................................................................................... ..4 

General Comments ....................................................................................................................................... 5 

Anticipated Value Effects ............................................................................................................................ 9 

Value Enhancement ......................................................................................................................... 9 

Value Diminution ........................................................................................................................... IO 

Indications of Value Impact ....................................................................................................................... 12 

Brokers' Opinions ........................................................................................................................... I2 

Property Tax Evaluation Adjustments ........................................................................................... 13 

Land Value Studies lnfonnation .................................................................................................... l6 

Balcones Canyonlands Conservation Plan (BCCP) ....................................................................... I8 

Conclusion ................................................................................................................................................. 20 

Notes .......................................................................................................................................................... 22 

Appendix .................................................................................................................................................... 24 
327 

Executive Summary 

Uncertainty concerning current and prospective land uses affected by tbe Endanaered 

Species Act (ESA) is an important element of the confrontation between owners and 

environmental advocates. 

• Owners and potential buyers may not know whether particular properties host an 

endangered specie. Observers report that bureaucratic judgments appear to be 

inconsistent from one property to another. 

• Potential buyers foresee possible bans on current land uses and the likelihood of 

lengthy delays in obtaining permits plus the possibility of incwring consulting fees 

and mitigation expenses. 

• Exacting mitigation fees in return for issuins permits adds the specter of an 

unanticipetcd IDd iDcalculable cost to Dlllllllemalt plans. 

• The combination of mitigation fees and rqulatory delay may cause Jarae mas of 

land to become UllldUICtive to buyers. 

• ID typicaiiDIIkets, these fKtors often translate into reduced offers llld ultimllely 

value losses for owners of affected properties. 

Surveyed brokers reflect tbis UDCa1lliDty. 

• Most (14 pen:a~) ofTexas real estate brokers rnpoadina to a survey (1,227 toea1 

respODies) either iDdic:ared DO impec:t or did DOt kDOw wbat impKt the ESA bas bad 

011 built-up un. Texas real estate values. 

• The C0DSa11U1 amoaa Texas real estate brokers expessiJc e opilliaD on value 

impact on wcaatlots, urbiD frinae laud aDd triiiSiticlllll nnJ lad (40 to 4S perceat) 

poiDts to value cleclines rcsuhina from ESA. 

• Broken estimlled. 40 paceat mediaD value decline for ..... frillee laud ill tbe 

Texas Hill eo..ry llld a 30 paceal decliDe ill~ lllld valaes raaJtiDa from 

ESA. 

• MediaD estimlled dec:liDa for fannlaDd aDd ......... values wried from 10 to 20 

pen:allilepfl!""'' OD localiaD. 
328 

Travis County property tax authorities have estimated value losses on affected properties. 

• A total of 897 propenies were affected by ESA and other environmental programs in 

the county in 1994. 

• Property value was reduced by 43 percent for all land categories. 

• Agricultural land values were reduced by 22 percent. 

• Transitional land values were reduced by 5 I percent. 

• Vacant platted lots wen: reduced by 45 percent. 

Aggregated sales data indications were inconclusive, although regional medians increased in 

affected areas. 

• Travis County and Williamson County area values increased 15 percent from 1992 to 

1994, but sales volume declined by 21 percent, possibly indicating that buyers were 

avoiding potential habitat propenies. 

• The Edwards Plateau - South area saw prices climb by 41 percent from 1992 to 1994. 

This remarkable increase appears to indicate the presence of numbers of speculative 

buyers anticipating that current problems will be resolved and values will increase. 

This kind of price suppc>rt could evaporate as rapidly as it appeared. 

• In the heavily timbeted North -East area, land values declined 9 percent from 1992 to 

1994 despite strong timber prices. Sales volume dropped 17 percent during that 

period. These statistics are consistent with the potential ESA impact associated with 

the red-<OC:lcadcd woodpeclcer, however other influences may have affected the 

market. 

The Balcooes Canyonlamds Conservation Plan (BCCP) proposes to accommodate development 

in affected areas by easing permit availability in return for fees imposed on landowners. 

• The Aprill9, 1995, version of this proposed plan includes a $5,500-per-acre fee to 

mitigate incidental taking of acreage wben developing land with golden-<:heekcd 

warbler or black-capped vireo babitat. 

• Additionally, vacant platted lots would incur a fee of S 1,500 before a home could be 

built. 

2 
329 

• Allhou&h rou1ine fllmina IIIII ranchiDa practices would be exanp1ed. tbose firm and 

nnch DUIIIIJement ac:thities requirinJ cJearins would incur a Sl,$00 mitiplica fee for 

each acre cleared. 

• Futlbennore, the fees approximate an assumed neragc land cost of $$,,00 per acre. 

If land prices rise, the fees could also inerease. 

• Because of regulatory lag and time-related capital COS1s, ownen of undeveloped 

acrease would likely see the market value of 1hcir property fall by more 1han 1llc 

amount of the fee, wheo the time value of money is coosidered. 

Available market.cJerived C\idence of the effect ofESA on land prices is skc~·. 

precludins an outrisht conclusion about the value-related effects of ESA. NeverdleJess, 

information gleaned from eDJDining 1llc ESA coo1roversy in Central TelW does indicate a cause 

for lender coocem. For eDmple, mutet observers in the Travis County area indicate a likelihood 

1bat a substantial acrease bas already been adversely affected by ESA. Tbcrefore, lenders appear 

to have a justified coocem about 1llc impact of Ibis act on 1hcir coUateral base. 

Analysis ofTravis County wessments indicate 1bat 1be most heavily affected properties, 

in dollar terms, are likely to be urban fiinse propaties and ''KIIIt lots. Tbe clepee of risk 

associated \\i1b inveslment in tbose properties bas unquestionably increased, and lending policies 

may need to reOect 1bat fact However, 1be reduclioa resistered on purely apicuhural propcrtia 

indicates a sizable decline as well, especiaUy if111c effect were to persist over a llrold exp1111e of 

tenitory. 

3 
330 

Statement of the Problem 

Lenclen provide fimda f01· purchase of land, homes and busillesaes. In mum, borrowers 

have pledged dleir holdi.nss as coUateral for these outstanding l01n1. CoUateral value is a critical 

clement in 1bc lending process, providing scc:urity for "Pital advanced in purdlasc money IOIIDI. 

Actions lbat dire& ten the integrity of the value of pledged collateral also lhreaten the "pi tal 

solvency of leaders' in\·estment portfolios. Restrictions on land usage lbat lhreatcn 1he value of 

borrowers' laad could represent a substantial iDcreasc in risk for the "Pi tal poaiti011 of 1hoae 

lenders. Some lenders ha\'e expressed c:oncem about the significance of this potential threat. 

This .Sy examines the issue of value loss associated with implcmentatiOII of 

environmental restrictions on land m~~~&gement procedures. The study addresses this issue in two 

specific dimeaaions as follows: 

I. ldcatification of conditioos lbat threaten value reductions 011 affected properties 

2. Allalyaia of market indicators suggesting \'llue losses associated \\ith specific 

envirOimental replations. 
331 

General Comments 

The potential effects of environmental replation on 1be market \'alue of affected 

properties bas c:aused wncem for lenders. Highly publieized iueidcuts, sud! u 1be Luc:as c:ase, 1 

demonstrated 1he potential for c:omplete '..tue loss for properties ad\renely affected by 

govenunental replations. Bec:ause of regulations resulting &om 1he ESA Uld Clean Water Aet, 

Section 404, 1he wetlands protection pro\ision ean impose severe limits on management praetiees 

relative to affected or potentially affected properties. Some lenders see inventories ofloans on 

sueh properties u wlnerable securities that faee 1be possibility of sizable lossea. Coneems c:enter 

on expected declines in value resulting &om eurrent and potential restrietions. In feet, aome 

agrieultutallenders fear that eollateral bue value declines have already oeaured in specifie 

affected areas ofTexas. 

For e:wnple, landowners in 1he western reaehes ofTra\is and Williamson c:ounties have 

seen restrietions applied to properties proliding aitieal habitat for 1he endangered golden dleeked 

warbler. Similarly, landowners in tbe Edwards Aquifer region of southern Texas have seen 

aeeess to underground water substantially altered in response to c:ompeting demands for 1he 

waters of the aquifer. The diffieulties initially surfaeed IS 1 struggle between agrieultural users 

and urban users. Now 1be ESA has become 1he foeus of the eontroversy IS environmental groups 

filed suit to bloclt any water usage that threatens to deplete tbe flow supporting endangered 

aquatie life in Comal Springs. 

Because of 1hese environmental eonc:ems, landowners in these areas have been proJu"bited 

from pursuing formerly noneontroversialland management regimens wid!out obtaining a pennit 

from 1he U.S. Fish and Wildlife Serviee (USFW). Owners in 1he warbler habitat area ean no 
332 

longer dispose of unwanted cedar, or develop property where such cedar exists, without USFW 

approval. Edwards Aquifer landowners can no longer develop untapped underground water. 

Furthermore, owners of existing weUs face possible limitS on water usage as the Texas water 

laws have moved from the traditional capture doctrine toward a regulated adjudication system. 

Variations of this kind of controversy have raged in selected areas as endangered 

organiSms have been identified. In many cases, landowners and lenders have anticipated lower 

values that reflect restricted potential uses and an intensified degree of uncertainty. Theorists 

argue that restrictions inevitably lead to a lower value for affected properties when they are 

compared with comparable unaffected properties.2 Some environmentalists initially acceded to 

that proposition as Samuel Hamilton of USFW declared, "The incentives are all wrong here. If I 

have a rare metal on my property, its value goes up. But if a rare bird occupies the land its value 

disappears". 1 Later, Hamilton implic:d that environmental regwations actually may have 

enhanced land values.4 This dispute about the effect of environmental regulation involves 

market-determining influences at the most fundamental level and has prompted the emergence of 

the property rights movemeut. 

Property Rights, Jlicbat and Best Use aad Market Value 

A strong property rights system within a weD-functioning free market creates powerful 

incentives for owners to manage their resources so as to maximize the market value of their 

property.' Free market forces lead owners to enhance market value by increasing the potential 

long-term contribution of their resow-ces to the ends envisioned by prospective purchasers. 

These contributions derive from both the production of commodity-based and amenity-based 

benefit flows. Because owners can gain the fruits of wise management under a strong property 

rights system, rational individuals administer their property to maximize current returns and to 

preserve future marketability. • 1hese tendencies provide the foundation for the principle of 

highest and best use, which serves as the most elementary Slandard of real estate valuation. 

Market value derives from the: array of current and potential uses open to property 

owners. The developer purchases a pasture with the vision of a completed subdivision populated 

by families demanding new homes. The rancher acquires a pasture to provide forage for the herd 

that be or she envisions grazing contentedly in the afternoon sun. The fugitive from urban 

6 
pressures sees a quiet retreat away from the city with a multitude of recreational possibilities and 

perhaps an investment gain. A dispassionate investor views an asset that promises not only to 

preserve his or her capital but also may return breath-taking gains. 

To achieve ownership, the buyer must outbid all competing potential users of the land. 

The owners with the most valuable uses set the price for land. Individuals are handed the reins 

and allowed to guide their dreams into reality, secure in the knowledge that society, through its 

property rights sysiem, will ultimately judge the results by conferring vast gains or inflicting 

punishing losses when the property is transferred. By mixing capital with land and 

entrepreneurship, the prevailing owner may increase personal wealth and leave purchasers of this 

improved land better off than before. This property owner either will be enriched for wise 

stewardship or punished for foolish management practices. 

Summarizing these possibilities, market value derives from the importance that potential 

users attach to their visions of effective management For the market to efficiently guide users to 

fulfill socially desirable goals, potential owners' expectations of management plans must be 

secured by a reliable degree of certainty. If the outcome and rewards of prudent land 

management and development remain in question, owners and potential owners have little 

motive to press forward with improvements. By securing rewards for prudent management to 

owners, property rights communicate societal expectations and social values to both owners and 

potential owners through market prices. Threatening the security of property owners' rights to 

future benefits reduces the value that owners place on their vision for property use and, 

consequently, reduces effective management effon. 

To illustrate how uncertainty affects behavior, a hypothetical program designed to 

provide benefits for indigent persons provides an example. The program seeks to ensure quality 

tnmsportatioo for illdigent persons by requiring owners of new automobiles to provide rides for 

homeless, unemployed persons at 110 cost. Compared to the unemployed indigents, the car 

buyers are walthy aDd can afford to give a lift to a less fortunate individual. This seems just and 

desirable, but such a policy would discourqe new car purchases by making ownership less 

desirable, especially if used ears were exempted. 

7 
334 

This policy impans an uoderlyins societal judgment that rights to a new automobile 

ought not to be exclusively assigned to those who can and do buy the cars. Rather, it implies that 

the disenfranchised should share in the wealth that societY hils bestowed on the owner md that 

this policy quickly redresses the inequalities fostered by a market-oriented system. Implicitly. 

the policy suggests that purchase of a new automobile is somehow less "vaauable" than driving 

that old one. In the end, this policy would reduce the attraction of new car ownership, aloug with 

the quality of total private transportation available to the economy. Changing potential owners • 

expectations regarding future enjoyment of the object of their property rights in this manner 

would produce far reaching economic effects. 

Property owners in the path ofESA enforcement etfons feel as though they face a similar 

situation. The same lesson is communicated to the East Texas landowner when neighbors find 

timber companies not interested in their marketable stumpage because red-cockaded 

woodpeckers have taken up residence. What long-term message do owners of rugged Hill 

Country properties receive when neighbors are prohibited from altering their acreage because 

their land "may" be habitat for an endangered songbird? Furthermore, what impact bas 

imposition of a development fee to "mitigate" habitat destruction bad on future investment? 

Potential investors, those who have consistently provided products that are eagerly purchased by 

the public, see each of these actions liS moves that threaten to diminish or extinguish the reward 

for risk-taking required to bring desired assets to the market. 

Those pursuing the salvation of the environment view land-usc decisions from the 

perspective of a norunarlc:et participanL They believe landowners are likely to usc land in a 

manner that will harm or destroy critical habitat for endangered creatures. Landowners also may 

seek to drain swamps, fill lakes or attack the public welfare in numerous ways. From this 

vantage point, these kinds of activity are so harmful that owners must be compelled, under the 

threat of imprisonment 10d fine, to refrain from such activities. Like raising marijuana, habitat 

destruction is viewed as an attack on society's values and the government must apply police 

power to forbid possible perverse acti.vities. From this viewpoint, the market appears to have 

failed to produce the socially desired ends and an invasive solution is needed to correct this 

deficiency. 

8 
335 

These two vastly different views ofESA and similar environmental regulations lead to 

differing views of the impact on value resulting from regulation. Property rights advocates see 

the regulations as poisonous intrusions in a we11-functioning market. Environmental advocates 

regard the regulations as belated steps taken to protect the health of a beleaguered planet. From 

these two conceptions, two opposite judgments of impacts on property value arise. 

Aaticipated Value Effects 

As demonstrated above, environmental regulations affect property values by altering the 

pen:eptions of typical market participants conc:crning the expected benefits of land ownership. 

Suggestions that value has been enhanced conflict with assertions that values have declined in 

the wake of regulations imposed by the ESA. Both possibilities deserve to be examined. 

Value Eahucemeat 

ESA regulation could enhaDI:e the value of specific properties in two dimensions. First, 

nollaffected property values could rise because of clecreased competition from properties 

identified as ESA babit.t. Sccood, values of affected properties could rise if critical habitat 

desipation makes properties more desirable to potential1and buyers. These suggested market 

developments are mutually exclusive as the followina discussion makes clear. 

The first case few value r:nlumc:ancnt relies 011 the simple laws of supply IDd demaDd. 

For a Jivea level of clemiDd for property, a marketable supply fixes the price. In the case of 

land, the dl"ective supply depends both on the physic:a1 quantity of 1and available IDd the portion 

of the total that owners offer few sale. 

For eumple. the amouat of1and wilbiD a hour's drive of Austin is fixed by the 

aeoanpllic fadures of die rcaioa IDd die iDfnslruclure available for the joumey. Each acre is 

poteDtially ill tbe supply of developable properties IIDd competes with all other acres baviDa 

comparable potential. In aiiCIIJIIaliDIIkct period, a proportioD of that 1and will be offered for 

sale. ESA ..wmoa will rau1t ill a quaatity of that acreaac beiDa removed from tbe tota1 SUJIPly 

oflaad 8VIIilablc for that market -... it wi11 DD loapr be available for clcvelopmeat. For a 

CCIDIIIIDllevel of dcmaDd, • reductioa ill IUpply will produce liD iDcrealc ill )lricc. 

9 
336 

The reduced supply scenario produces windfalls for non-habitat property owners. but 

property containing habitat would likely decline in market appeal as a result of its presumably 

reduced utility. For prices to rise across the entire market. values for these nondevelopable tracts 

also must increase. ESA sharply curtails any activity in areas with habitat; even grazing and 

fence building could be limited. Thus, the land would appeal to fewer buyers as potential 

investors and agriculrural producers would find the acreage less desirable. 

To engender a price rise for affected properties, ESA restrictions must appeal to a pool of 

potential buyers that gains satisfaction from owning habitat properties. Such purchasers likely 

would be committed environmentalists who draw satisfaction from the understanding that 

surrounding properties with habitat also would remain undisturbed. To offset potentially reduced 

demand inspired by ESA restrictions, these buyers would be needed in sufficient numbers to 

offset defections by potential buyers who were discouraged by ESA. 

If this two-pronged rising market were to develop, market participants would note an 

increased presence of the new buyer and push by developers to acquire non-affected acreage. 

Furthermore, in aggregated statistics, overall prices should rise with sales volume remaining 

steady or incfCl!Sing. 

Value DiminutioD 

ESA regulations reduce the appeal of affected properties for many potential users. By 

prohibiting the "taking" of endangered species and defining "take" to broadly include nearly all 

contemplated activities on the land, ESA severely influences land-use decisions. 7 Cattle raisers 

are prohibited from making improvements that wiD enhance their profit. Developers are 

enjoined from realizing the vision of a new community rising from the soil, or they are faced 

with increased costs due to mitigation fees that result in a competitive disadvantage and increase 

the overall risk of their project. 

Supporters ofESA point out that "more than 99 percent of all projects do go forward," 

after USFW offered Mreasonable and prudent alternatives" to allow projects to proceed (Facts 

About the Endangered Species Act). However, this document, distributed by the Department of 

the Interior but not listing an author or publisher, does not address another troublesome aspect of 

10 
337 

the ESA process. The phenomenon of regulatory lag and the attendant capital costs incuncd as 

owners await official action are completely ignored by this unidentified document. Furthermore, 

costs of surveys and consulting fees paid by landowners are not mentioned as important factors. 

Property owners judged to have ESA habitat will also likely be required to pay mitigation fees or 

acquire habitat to be set aside to replace habitat that is destroyed by their management plans. 

These items add to the expense of operating a successful property even, when the envisioned 

development is a simple fence. 

Furthermore, the time required to obtain permission for panicular management activities 

is unknown, and observers have suggested that decisions handed down by USFW appear to be 

inconsistent from one property to another.1 Regulatory lag, coupled with inconsistent patterns of 

judgment, creates considerable uncertainty, expanding the risk of owning and managing land. 

Investors could perceive a greater level of risk associated with land ownership for all kinds of 

land. These negative factors discourage potential buyers and thereby decrease demand for land. 

When pools of potential bidders abandon the market, demand pressures ease and prices 

tend to soften. Those buyers who are committed to purchase continue to buy, but new entrants 

hesitate, waiting for resolution of this uncertain state. Reduced competition on the demand side, 

with a constant level of supply on the seller's side, leads to reduced prices and a falling level of 

activity. At first, prices tend to hold or even increase while volume drops. The market is 

faltering and the marginal trades fail, while transactions on quality properties move to 

completion. The bottom of the distribution vanishes, and the median or average price moves up. 

Later, marketwide weakness reduces median prices. The falling price scenario confonns to this 

kind of market dynamic. 

II 
338 

Indications of Value Impact 

Evidence of the impact ofvalue transforming events emerges in a market after the event. 

Individual decisions of market participants proceed under a cloud of uncertainty surrounding the 

event Outcomes of those decisions merge in the flow of commerce and reflect myriad potential 

value-altering influences. Only the passage of time provides an accumulation of eviden~ to 

measure the effect of the shock to the market system. 

Analysis of sales of comparable properties provides a revealed market valuation of the 

influence in question. The ideal measure of the impact of ESA could be reached by analyzing 

sales of properties subject to resuiction against properties free of the restrictions over a 

sufficiently long period. Multivariate analysis could confinn the existence of an effect and even 

provide a measure of its magnitude. Unfortunately, no pool of data with sufficiently detailed 

information about property characteristics could be located within the time frame of this study. 

Therefore, it was nec:essuy to seek secondary indicators of value influeDceS. 

Broken' Opilliou 

OpiniODS of informed market participants and observers provide an initial clue to market 

trends when a potentially market-altering event shocks m area. Tbe Real Estate Center at Texas 

A.tM University c:onducted a survey of 6,000 real estate brokers wbo were chosen at random 

&om ~ pool of aaents wbo devote more thm SO pen:cat of their time to some real estate activity. 

This state-wide survey iDc:ludcd areas affected by the Jis1ina of the aolclcn-cbceked warbler BDd 

Rd-coc:bdcd wooclpecb:r as wdl as 67 other eucSanacred species listed iD Texas BDd produced 

1,227 usable mponses.• Respoodeurs were asked to provide their opiDioas reprdiDa the effect 

of ESA on land values of affec1ed properties. Tbe survey allowed respoadeuts to inclicare 

wbc1ber ESA effects ba6 iDcreased property values, left them UDCbanaed. dccrcased them or 

JauiDed llllbowD. Funbenuore, respcmdcats were asked to i1111ate the perc:entqe cbanae that 

bad oecwml, cluriDa the pat lCD yan. iD volume of sales and property values directly associa1ed 

with ESA. Fmally, they were aked to forecast ESA price-rel8tcd impKt cxpec:t.ed ill the next 

fiw,.s. 

12 
339 

State-wide results indicate that brokers arc split on their judgment of the ESA's effect on 

sales volume. Most respondents (84 percent) either indicated no change or unknown for the 

effect on built-up urban real estate. However, sizable miriorities (40 to 45 percent) indicated a 

perceived dip in volume as a result of the ESA during the past five years for developed vacant 

land. urban fringe land and transitional rural land. Few respondents had observed increases in 

sales volume (0.6 to 3.0 percent). These results lead to the conclusion that. as a group. brokers 

appear to be largely uncertain about the effect of the ESA on sales volume. However, sizable 

minorities have discerned declines in value associated with ESA. Furthermore, those minorities 

arc located in areas where the act has attracted the greatest attention, leading to the conclusion 

that the effect is uneven across Texas. 

Most of the value loss indicated in the survey concentrated on the urban fringe and 

transitional land groups. The largest median value change estimates for these groups centered in 

the Texas Hill Country ( 40 percent overall decline for urban fringe and 30 percent decline for 

transitional lands) and the northeast comer of Texas (35 percent for urban fringe). These areas 

arc noteworthy as areas with habitat for the golden-cheeked warbler and red-cockaded 

woodpecker, respectively. Additionally, panelists indicated estimated declines ranging between 

I 0 and 20 percent for fumland and rangeland statewide. Finally, respondents forecast state-wide 

median declines (12.5 to 25 percent) in value for affected properties during the next five Yea!J. 

The repon concludes: 

Time will reveal the extent of aggregate property value impact from the ESA. 

Texas brokers who arc active in the market believe that the impact has been negative and 

will continue. While a few respondents indicate that property values have risen, the 

majority either do not know the impact or believe that values have declined. 10 

Although this reponed evidence does not demonstrate a verifiable effect associated with ESA. it 

does indicate that a consensus among brokers foresees values falling because of the act. 

Property Tax Evaluatioa Adjustmeats 

Propeny value serves as the primary index oflocal taxation in Texas, and landowners 

typically seek to keep the assessed values of their properties at the lowest possible level. 

13 
340 

Although many tax bills for agricultural land are based on productivity values in agricultural use 

rather than the taxable market value, even owners of land taxed on agricultural use values have 

an il!centive to keep market value estimates for these properties low to limit the potential 

rollback tax.

11 For much of the land impacted by ESA, agreements between assessment 

authorities and the landowners are the first point where negotiated valuation adjustments appear. 

In 1994 owners requested valuation reductions for properties affected by a variety of 

endangered species including: golden-cheeked warbler, cave invertebrates, the black-capped 

vmo, miscellaneous other restrictions and the restrictions associated with the "Save Our 

Springs" program. According to the Travis County Central Appraisal District (CAD), 1994 

adjustments were applied to 897 properties totaling a 43 percent reduction from the initial market 

values. By this estimate, these environmental restrictions resulted in a $74 million reduction in 

taxable market value as shown in the following table. 12 

Effects ofEodaogered Species Habitat 

OD Travis Couoty Taxable Market Laud Values 

Uaadjusted Adjusted Perceat Numbe• 

Code Value Value Effect Affected 

Endanaered Species (ES) s 51,662,265 S 16,653,5 II -68% 57 

f<Jolclen Cheeked Warbler (0 I) 18,026,335 13,131 ,770 -27 161 

islaclc Capped Vim> (02) 50,921 35,067 -31 2 

Cave Invertebrates (03) 9,493,238 7,786,787 -18 41 

Combination of Species (04) 31,339,816 24,463,145 -22 211 

Construction Resuaints: Warbler (05) 13,663,299 12.793,943 -6 245 

Critical Water (06) 1,925.771 1,291,133 -33 10 

Save Our Sprinp (SO) 47,572,S64 23,515,570 -SI 170 

Totall s 173,734,201 s 99,677,916 -43% 197 

Sau!ce: T ... is Counly ~DUrio~ 1994 Tu Rolls 

14 
341 

Effects ofEndancered Species Act on Tanble Market Values 

For Afreeted Properties in Tnvls County Texas- 1994 

Prope11y Type 

Apicu1nnl - Rec:eivins Open-space Valuation 

Aaricultural - Not Rec:eivins Open-space Vahwion 

Residential - 8oth SFR and MF 

Vacant Platted Lots 

Other l'loperties 

Totals 

Nate: Propaties ncedina- not indudod in-- Source: .Travis COUIIIy APfnilol DiJirid 1994 Tu Rolb 

u .. dj•sted Adjatted 

Valae Value 

$ 23.927,640 $ 18,712,983 

97.104,642 41,039,SOS 

S.230.4SO 4,811,918 

39.213.797 21 ,617.734 

1.257.679 6,495.787 

s 173,734,201 s 99,677,9%7 

Perceat N .. doer 

Redactioa Affected 

-22% as -SI 197 

-· 

S4 

-45 S40 

-21 21 

-43% 897 

This information closely approximates ·the overall decline estimated by respondents to the Jones 

survey. The overall decline of 43 percent is a weighted average decline with actual individual 

changes I'BDging from zero to as much as 74 percent of value. No increases were imposed 

because of ESA. The data also conform to judgments registered in the Jones survey specifically 

showing the most pronoWlCCd declines in agricultural land that is not receiving productivity 

valuation treatment (probably trausitional and urban fringe lands) and vacant platted lots with 5 I 

and 45 percent declines, respectively. 

These adjustments reflect the assessment authority's best estimate of the value effects 

following from ESA habitat designation. Tax values are frequently dismissed as indicators of 

market value for specific properties because they are based on mass appraisal techniques. This 

may lead to contentions that the tax valuations do not provide compelling evidence regarding 

ESA impact. However, the Comptroller's Office Property Tax Division indicates that 1M Travis 

County CAD appraises properties at 99 percent of market value overall, with a coefficient of 

dispersion of 10.99. This indicates an acceptable level of accuracy in appraisal, especially when 

compared with a state-wide coefficient of dispersion of 14.17. On vacant planed lots and rural 

real estate, Travis CAD appraised at 100 percent of market value in 1994 with coefficients of 

dispersion of 17.05 and 16.39, respectively, compared to statewide coefficients of 19.68 and 

1!.61. ll 

15 
342 

This offu:ial state study of appraisal records inditates that Travis CoUDty apPraised values 

tend to approach market value:, on average, and that those' appraisals have an acceptable level of 

accuracy that exceeds others in the remainder of the state: Thus, the Travis County CAD staff 

has demonstrated a high degree of knowledge and skill in estimating property values for taxation. 

While this evidence does not conclusively demonstrate a substantive negative impact 1iom ESA. 

it does contribute to the mounting numbers of informed real estate market participants 

anticip~~ting value declines for some properties in the wake of ESA designations. 

Land Value Studies Information 

Analysis of land price data maintained by the Real Estate Center14 could provide 

information in either of the two dimensions expected to reveal ESA 's impact on value. 

Spec:ifitally, the data could evidence land value impact if ei~ UDexplained sales voiiDDC or 

price changes oc:curred while ESA was an issue in land markets. However, information in rural 

land sales studies conducted by the Center neither conclusively confirms nor denies ESA effects. 

Land prices in the most likely affected areas (Austin, Waco and the Edwards PlateauSouth) increased 1iom 1992 to 1994, but the sales volume may have decreased in the AustinWaco areas. The price increases appear to contradict foreseen negative effects. However, the 

ex_eec:ted negative effects may have occurred on affected properties with the declines being 

swamped in market-wide data where disproportionate numbers ofWlaffected properties sold. 

Although the recorded price increases do DOl confirm expected price declines, neither do 

they evectively refute the forecast of substantial negative effects for ESA. The anticipated 

negatiye effect simply may DOt have appeared as a market-wide, price depressing influence for a 

variety of possible reasons. First, observers indicate that the most visible influence arising from 

ESA on affected properties appears as buyer avoidance. lfbuyers are indeed shying away from 

properties that they deem at risk for curtailed use, transactions moving through the market would 

contain fewer sales of affected properties. Furthennore, strong demand for land in areas that 

contain affected properties would be concentrated on fewer remaining Wlaffected acres, driving 

16 
Treads iD Teus Rural Lud Priees 1992-94 

.._ -Prlct T_._ v ..... of Sola Aut.-~ 

~~~- CSIKI --c..- Noe .. rofSalol' r....-o.- Ara I ttl IMl ltN' IM2 .. l lm.N 1'"-" I ttl IMl ltN' IM2 .. J lm.N IMJ.N 

I l'71 HI 4t2 ·1 .7 II 73 S7 61 .:IJ ·16 7 

2 HI »6 lU -7 .. ·I 117 " 151 · 16 • 67 

l OS .. 441 ·I I l IN 127 Ill 21 J5 

.. • HI ... ns 14 7 -4 127 127 In I • ·• I I. I" lll ·I 17 II NA "" NA "" "" !lA 

6 217 ., 266 -4 ll II Ill Ill 116 12 -2 ·12 

7 HI lSI HI I I I 116 Ill 121 .JI ..JI .J 

I .. SJ tS ·ll • " NA "" NA "" "" NA 

' 271 251 

--7 II' 21 121 Ill IN -4 ·ll .. II SIJ m 7U ll .... 26 161 I !II 176 -4 ' 14 

II llS 

-... 16' It" l • Ill 71 • 27 .JI 

u lll m fll ·I ' 6 156 197 211 I s • u 421 .. ,., s 17' ll ... Ill 144 I ll l'7 

•• -., Stl ·I II II 167 121 171 ·ll 7 l9 

IS S6S <ll9 "' -22' -21 l 51 6J » u ..J5 -41 

16 

-... ..... 6 Zl'' II " Ill Ill ll 6 4 

17 1...,., I.»> l.m :u :u I "" l'7 NA NA NA 

II 1G "" - 971 s • Z2' Ill 172 lll J5 SJ D 

It "' "' .. 4 -4 ·I m u. 162 IS -Z7 -Z7 

21 6IJ 616 ~ ·II .,J • 151 I. ISl -4 ·I J 

ll 711 "' .,. -2 7 ' Ill U7 IN s J5 21 

Z2 ,.. -,. ..J s ' ., lll IM 6 ·I -4 

u "' l.nt I .lSI ... ... l IN tl Ill ·14 7 u u ,., 1- l.f71 II .... ' U7 IS Ill .JI .JI lt 

J5 ., 712 ,. 2 ... s U2 ut 216 7 ·II · 17 

• an "' .... I IS" ' ID lll 144 • -21 .JI 

27 IMt ..... "' -4 ·1' ·I Jll 211 Ul ·II -4 II 

• 1,212 1,175 I ,Ill ·II -2l' ·IS " ·ua I. » .. D 

lt .. - m ·ll ... s lit m Ill I ·17 ·II 

21 

- m .. ..J s I ISJ IM I. · ll -2 ll 

ll ,. "' .,. 16 17 I J2 • 47 J5 47 II 

J2 l,ltl l,llt 1 ... -4 l'7' ... .. 77 47 .. -44 .., » l.tSI ,.... l'llt' ·M "" "" "" "" l'llt' NA "" "" sea .. NS 6lS .. ..J 2" ... ..., Ul4 4MS I I ·I 

....._.., '"" ................ ..... 'NRSiplla•-_... 

• _.__,...._ ..... s_, ..... .. Slplllol-........ - ..... 1 ................. 

-·

T-MMu....Jir --c..w 

17 
up prices for those tracts. Second, buyers misht anticipate that the markets will oVerreact to any 

stigma associated with environmental conditions. Such buyers would purchase, believing that 

future prices for such lands are lilcely to be much higher than today' s prices after the public and 

the markets have adjusted to restrictions. Finally, buyers may not have been fully informed of 

the effects of ESA during this period. 

· Inspecting the total numbers of sales for land market areas (LMAs) I 0, 25 and 26 indicate 

a steady volume in LMA I 0, the Edwards Plateau-South (see Appendix for a map of LMAs). 

Observers in that IIIIUtet suggest that some current buyers are indeed speculating that the ragirag 

comrovmy over water rights in the &Iea will provide them with a legally proven and possibly 

IIIIUtetable water right Given that potential motivation, a steady or even rising sales volume 

could be expected. 

However, sales volume in LMAs 25 and 26, Waco and Austin respectively, increased 

from 1992 to 1993 but have fallen in 1994. The preliminary 1994 volume statistics for the 

Austin area (Biacldands-South LMA 26) indic:ate a substantial lag behind the volume posted in 

1992 and 1993. Although the high level of sales in 1993 probably occurred because of several 

extraneous faCtors, the apparent decline in 1994 volume may partly be the result of buyers 

avoiding land that they believe may be subject to ESA regulation, 

lbis analysis iDdicates that qgregated dala do not represent land prices or values of 

pllticullr classes of properties but, ratber, the Slatistic:s provide a general guide to land market 

c1eve1opments. ·Only filrtbcr stucfies of individual dala for specifically affected properties will 

coafinn or deny the expected ESA e1rect on runlland values .. 

Baleoaes Cuyoaludl CoDMrfttlo• Plu (BCCP) 

Travis CoUDty bu propoted to cooperate with tbe City of Austin and USFW to obtain a 

rqioul Scctioa 10(a) permit, the permit required to develop land where wnler babiut could be 

iDcidenciUy taken. l'lrtic:ipmts in this plaa could develop their land under the zeaional permit by 

Jlll)'ina a fee to mitia- babitll deslructioa. l'lesumably, optina into this vo1unllly plan would 

cut short the regulatory delay required to obtain an individual permit and reduce the overall cost 

II 
345 

to the landowner. Proceeds gained from the imposed fee would be used to acquire additional 

habitat as part of a permanent preserve. 

Mitigation fees became necessary when Travis County voters balked at publicly funding 

land acquisition required for the preserve. The amount of the fees causes out-of-pocket expenses 

to current owners and indicates the effect such fees may have on their overall wealth. The April 

19, 1995, version of this proposed plan imposes a fee of$5,500 per acre for development of 

acreage with golden-cheeked warbler or black-capped vireo habitat. Additionally, owners of 

vacant platted lots would be required to pay S 1,500 before building a home on the property. 

Although routine farming and ranching practices would be exempted, activities requiring 

clearing would incur a $1,500 per-acre clearing fee for each improvement. For example, 

building a bam would require a fee payment. Furthermore, the fees are based on an assumed 

average land cost of $5,500 per acre. If land prices rise, the fees also could increase.

15 

If this plan is put into effect, owners of undeveloped acreage would see their market value 

fall by the amount of the fee.

1

' The downward adjustment may be even larger than the fee itself 

when the time value of money is considered. Because the fee is an expense incurred before 

development begins, it requires capital outlays at the beginning of development activity. Thus, 

developers would incur the cost of capital invested in the fee as an expense during the 

development period until sales had recouped that investment. Thus, the process is fraught with 

uncertainty both relating to dollar cost and to the opportunity cost of time delays. 

The final incidence of the fee would depend on an owner's ability to pass the fee along to 

final users. The ability to shift the fee to final users is directly related to the supply of competing 

lots that are not subject to the added expense of the fee. If a development is unique and there is 

effective demand for the lots, developers could recoup all of the fees paid. However, 

developments lacking some compelling unique feature will be forced to compete with similar 

properties. Owners of non-unique properties in highly competitive markets will incur all or 

nearly all of the mitigation expense. The degree of shifting depends directly on the degree of 

competition in the market. 

Although the area west of Austin in Travis County is uniquely attractive, homeowners 

can choose from alternative developments. Owners of properties in this area may be able to 

19 
346 

shift some of the mitigation costs to others. Bea.usc of competing propenies in the market. most 

owners of nontransitional, agricultural land likely will absorb all of the expenses resulting from 

mitigation fees. The degree of this potential shifting remains unknown. Future studies should 

explore the impact of these mitigation fees in an analysis of the financial attributes of the 

development process. 

Coac:lusioa 

Although direct evidence <•f prices paid in areas substantially affected by ESA in Texas 

remains incootlusive, the consensus among Texas real estate brokers expressing an opinion 

points to some value declines associated with restrictions accompanying the act. Reacting to a 

perceived reduction in potential use, these brokers estimated that substantial declines in value 

from ESA impatts already have ottUITed. 

The uncertainty sunounding land impacted by the ESA is perhaps the most troublesome 

element of the ESA controversy. Owners and potential buyers simply cannot know whether 

panicular properties host an endangered specie or possibly could suppon such a creature at a 

future date. Furthermore, restrictions 011 use or the prospect of restrictions contributes to this 

disturbing climalc of unc:ertaiDty. Potential buyers foresee possible bins on currendy typical 

land uses and the likeliboocl of lenathY delays in obtaining permits to pursue their plans for the 

property, plus the possibility of coDSUlting fees and mitigation expenses. Finally, the pnttice of 

exacting mitiption fees in return for issuina permits adds the specter of an unanticiplled and 

unknown cost to IJI8II8IaDCIIl plans. The combiulion of mitiptioo fees and regulatory delay 

c:ould cause expllllleS of market areas to bec:ome unattnlttiw to buyers. In typical markets, these 

kinds of fac:ton routinely translate into rcduc:ed offers and, ultimately, value losses for owuers of 

affec:ted propatiea. 17 

In - araas, buyers lf'PC8I' 10 be specnJifj"' that tumDl problems wiD be resolved lnd 

values wiD iDc:reasc. especiaiJy ill 1be Ed-.ls Aquifer- west of San Alltoaio. 1bis 

specuJmon .,_..to haw boolted m.tel·wide value iDdialton. 1bis kiDd of price suppon 

could CVIpOI'IIC as npidly as it bas appared lbould 1be market dewlopment path envisioned by 

20 
347 

the spoaalaton fail to appear. Prices would likely plummet as demand atrophied aocl values 

lagged. 

The e\idence presented here is sketcl!y, prec:Judins an oulript c:onclusion about the 

magnitude of the value-related effec:ts of ESA. Nevertheless, information gleaned in e:wnining 

the ESA controversy in Texas does justifY cause for concern about the intepity oflenders' 

collateral base. For example, marli:et observers in the Travis Count)· area cite the likelihood that a 

substantial acreage already has beeo adversely affected by ESA. Therefore, lenders should be 

concerned about this impact of the act on their collateral base. 

Analysis of the Travis County assessments reveals that the most heavily affected 

proper1ies, in dollar tenns, are likely to be urban friDge properties aocl vacant lots. The degree of 

risk associated \\ith investment in those proper1ies bas unquestionably increased aocllending 

policies may need to re11ec:t that fact. However, the reduction registered 011 purely agricultural 

properties points to a sizable dec:line as well. This lesser proportiooate decline may prove to be 

especiaUy troubling for lenders' collateral, particululy if the effect persists over a broad expanse 

of territofy. 

The BCCP program, ostensibly designed to facilitate development west of Austin, 

pi'O\ides an indication of the co9' associated "'ith ESA in that rtgi011. If the assumed laocl value 

cited in the plan is correct, landowners \\ill incur mitieation fee exPenses equal to the value of 

their property. Any subsequent purchaser surely will consider that potential cost before makio& an 

offer. Such a fee structure probably wiD have a substantial negative effect 011 land values in the 

region. 

To systematically gauge the extent of the ESA problem, lenders should undertake a 

broadl)' based, intensive study to identity affected aDd DOIIIff~ properties. This analysis 

would aUow lenders to establish the indicators of ESA habitat and ideotity its vaJue..related 

effects. This kind of study would require extensive data sets of comparable sales but would 

provide the best indicatioo ESA value effects. The study should be geograpbically di\"erSC to 

include areas with few problema as weD as the highly contested regiooa. In additioo, lenders 

could examine the impact of specified BCCP mitigatioa foes 011 land values for various classes of 

property and property ownen. By systematically evaluating the potential impact, lenders Clll 

obtain a more accurate measure of the possible dnat to their coUateral base. 

21 
348 

Notes 

1

Lucasv. South Carolina Coastal Council, 112 S. Ct (1992) 

2

Guidry, Krisandra A. and A. Quang Do. "Appraisal Assigrunents Involving Endangered 

Species." Appraisa/Journa/. 62(January 1994): 98-102. 

3

Carpenter, Betsy. "The Best-laid Plans: Habitat Conservation is not Nearly as Simple or 

Ratiottal as it Sounds." U.S. News & World Report, Oct 4, 1993: 89-93 

"Hamilton, Samuel. Remar/cs Delivered to Faculty At Texas A&M University. August 30, 1994. 

'Randall, Alan. Resource Eco~romics: An Economic Approach to Natural Resource and 

Environmenlal Policy. Grid. Columbus, Ohio. 1981. 

6oemsetz, H. "Toward a Theory of Property Rigbts." American Economic Review. 57(May 

1967: 347-359 

7

Meltz, Robert. Tire Property Rights Issue. Congressiottal Research Service The Library of 

Congress Report CRS 95-200 A. Washington D.C. January 20, 1995. 

'The Nature Conservancy. The Workings of the Endangered Species Act: A Summary of Our 

Findings. from a Report to Board of Governors. Arlington, VA. February 8, 1995. 

9

Jones, Ted C. eta/. "Impact of the Endangered Species Act on Texas Real Estate". Tierra 

Grande. Real Estate Center, Texas A&M University, Summer 1995. 

10Jones, Ted C. eta/. "Impact llfthe Endangered Species Act on Texas Real Estate". Tierra 

Grande. Real Estate Center, Texas A&M University, Summer 1995. 

11Gilliland, Charles E. Guide to the Tuas Property Tax System. Real Estate Center Pub. No. 

678. Revised 1992. 

12Travis County Central Appraisal District. Environmentally Impacted Land Taxable Values 

Data. Supplied from 1994 tax 1roll. 

13Comptroller of Public Accounts. School & Appraisal Districts' Property Value Study 1994 

Preliminary Report. Austin, TX. Tax Publications #96-305. February 1995. 

14Gilliland, Charles E. Tuas Rural Land Prices 1993, Real Estate Center, Texas A&M 

University. College Station, TX. Forthcoming. 

22 
349 

15Travis County Commissioners Court. Balcones Canyonlands Conservation Plan (BCCP) 

Shared Vision. Draft version. Austin, TX. April 19, 1995. 

16Biake, Daniel R. "Property Tax Incidence: An Alternative View." Land Economics. 55(Nov 

1979): 521-531. 

17Guidry, Krisandra A. and A. Quang Do. "Appraisal Assignments Involving Endangered 

Species." Appraisal Journal. 62(January 1994): 98-102. 

23 
350 

Appeodix 

Texas Land Mukd Areas 

2.4 

0 

ISBN 0-16-052816-X 

9 801 163