COMBINING ECONOMIC AND ECOLOGICAL INDICATORS TO PRIORITIZE SALT MARSH RESTORATION ACTIONS

Transcription

1 COMBINING ECONOMIC AND ECOLOGICAL INDICATORS TO PRIORITIZE SALT MARSH RESTORATION ACTIONS ROBERT J. JOHNSTON, GISELE MAGNUSSON, MARISA J. MAZZOTTA, AND JAMES J. OPALUCH Restoration of damaged or degraded ecosystems often represents an important component of environmental management (National Research Council). However, funds are typically insufficient to restore all candidate sites. This paper summarizes an ecological-economic model designed to assist managers in prioritizing salt marsh restoration actions. The model integrates information concerning both the production (supply) and value (demand) of wetland habitat functions. Although the project focuses on salt marshes in Narragansett Bay (RI), the approach is more generally applicable to assessing habitat restoration actions. Ecological production relationships determine links between salt marsh attributes and associated habitat functions. Although there is an extensive ecological literature on these relationships, considerable judgment is needed to interpret the literature in order to quantify how restoration actions would contribute to habitat for a range of species (e.g., Burdick et al., Able and Hagan, Wigand et al.). For this reason, we developed a survey of wetlands professionals to identify a consensus of expert opinion on production relationships among physical marsh attributes and particular habitat or ecological functions. While habitat functions are determined by ecological (physical) relationships, social values for these functions are determined by Robert J. Johnston is assistant professor in the Department of Agricultural and Resource Economics, University of Connecticut; Gisele Magnusson, Marisa J. Mazzotta, and James J. Opaluch are, respectively, graduate research assistant, adjunct professor, and professor in the Department of Environmental and Natural Resource Economics, University of Rhode Island. Authors listed in alphabetical order; senior authorship not assigned. The research was funded by the National Science Foundation STAR Grant Program and by the University of Rhode Island Agricultural Experiment Station, AES #3936. This article was presented in a principal paper session at the AAEA annual meeting (Long Beach, CA, July 2002). The articles in these sessions are not subjected to the journal s standard refereeing process. public preferences. Rhode Island residents preferences for salt marsh functions were estimated through an application of stated preference (conjoint) analysis. The two models were designed to integrate production with values of wetland functions, thereby providing insights into the set of restoration actions that would offer the greatest potential for welfare improvement, given a fixed restoration budget. This paper discusses the design, implementation and estimation of the integrated model, and provides an example of how the model may be used to prioritize multiattribute restoration policies. Estimating Production Relationships: The Expert Survey Consultation with wetlands experts revealed that the provision of wildlife habitat was likely the most significant function of Narragansett Bay salt marshes; this also represents a primary function for which sufficient information exists to substantively differentiate among alternative restoration sites. The expert survey instrument was designed to determine the extent to which physical attributes of salt marshes and their surrounding landscapes contribute to the provision of habitat for various species groups of birds, fish, and shellfish. Survey development required approximately two years, and involved extensive background research, including interviews and pretests with twenty-seven experts in salt marsh ecology, and a literature review of existing assessment and evaluation methods (e.g., Shriver and Vickery, Bartoldus, King et al.). The survey asked respondents to rate the potential of coastal wetland complexes characterized by a range of physical attributes to provide habitat functions for different species groups. The responses allow estimation of the relationship between the Amer. J. Agr. Econ. 84 (Number 5, 2002): Copyright 2002 American Agricultural Economics Association

2 Johnston et al. Prioritizing Salt Marsh Restorations 1363 physical attributes of a wetland and resultant potential for various habitat functions. These results supplement findings from the existing wetland ecology literature. Survey booklets were printed in color and mailed to 102 experts in wetland ecology and biology, located primarily in New Hampshire, Massachusetts, Rhode Island, Connecticut, and New York. Analysis presented here incorporates responses from forty-nine surveys (48% response rate). Focused interviews and literature reviews were used to select twenty-one primary attributes for inclusion in the conjoint survey. An example survey scenario characterizing a hypothetical coastal wetland is shown in figure 1. Coastal wetland attributes included ten features internal to the wetland and eleven features of the surrounding landscape (table 1). Based on these attributes (cf. figure 1), respondents rated the potential for the site to provide habitat functions for Table 1. Expert Survey Model Variables: Definitions Variable Units and Name Description Measurement Wetland Features Size Area of all contiguous, vegetated salt and brackish wetland Acres (1, 5, 17, 65) Water Type of adjacent water body (coastal river, embayment, or Dummy variables (0,1) salt pond) Fringe Shape of the contiguous wetland area (fringe versus meadow) Dummy variable (0,1) Percentage of contiguous wetland area covered in Spartinia spp. SM M SM L (10 27% Spartinia, 69 83% Phragmites) Dummy variables (0,1) SM H SM M (50 62% Spartinia, 32 50% Phragmites) SM H (80 95% Spartinia, 4 9% Phragmites) Low H High% of low marsh (Spartinia alterniflora) (10% versus 4%) Dummy variable (0,1) Brack Presence/absence of brackish marsh (3 6% of wetland area) Dummy variable (0,1) ESS Presence/absence of estuarine scrub-shrub (3 6% of wetland Dummy variable (0,1) area) Rest M Tidal restriction: none, moderate, or severe restrictions Dummy variables (0,1) Rest S Creeks The presence/absence of creeks which drain at low tide Dummy variable (0,1) Channels The presence of subtidal channels inundated during all Dummy variable (0,1) tidal stages Pan 5% % of marsh covered by pannes: 1%, 5%, or 15% of marsh Dummy variables (0,1) 15% area Pool 10% % of marsh covered by pools: 1%, 10%, and 20% of marsh Dummy variables (0,1) 20% area Landscape Features Buff shrub Presence and type of 100 ft. vegetated buffer around wetland: none, shrub, or Buff for forested Dev M % of developed land in 500 ft. area around wetland. Includes residential, Dev H commercial and industrial. Levels include low (19 27%), medium (35 56%), and high (72 83%) Ag M % of ag. and managed grass land within 500 feet. Includes crops, grazing, playing fields, golf courses, and extensive lawns. Levels include low (8 18%) and medium (29 62%) For M % forested land within 500 feet. Forested land including brushland, forested upland and forested freshwater wetlands. Levels include low (8 16%) and medium (29 65%) Fresh w Distance to the freshwater wetland: within 1/4 mile, or greater than 1/4 mile Fresh f Flats Presence of tidal flats 25% of the size of the coastal wetland area (indicated in acres on the survey) Eelgrass Presence of eelgrass in adjacent waters OtherSM Indicates the presence of another salt marsh within 1/2 mile Access Indicates that access to the coastal wetland is not limited, as compared to restricted access

3 1364 Number 5, 2002 Amer. J. Agr. Econ. Figure 1. Example: Expert survey salt marsh scenario wading birds, waterfowl, shorebirds, marshdependent songbirds, other songbirds, resident fish, nonresident fish, and shellfish, as well as for overall birds and fish. The fivelevel scale ranged from no significant potential to exceptional potential. In addition, for each species group, respondents had the opportunity to indicate that there was

4 Johnston et al. Prioritizing Salt Marsh Restorations 1365 Insufficient Information provided by the instrument, or that they were Not Qualified to Answer. Data analysis incorporated eleven separate ordered logit models one for each species group. Production Relationship (Expert Survey) Results Tables 2 and 3 list ordered logit results for each species group. All models are significant Table 2. Preliminary Results of Expert Survey Birds Marsh- Wading Dependent Other Overall Variable Birds Waterfowl Shorebirds Songbirds Songbirds Birds Size (1 Acre) 5 Acres Acres Acres Saltmarsh (Low) Medium High Adjacent Water Type (Salt Pond) Coastal River 0.52 Coastal Embayment 0.63 Tidal Restrictions (None) Medium Severe Percent Coverage by Pools (1%) 10% % 0.40 Buffer Type (None) Shrub Percentage Land Development (Low) Medium High Freshwater Wetlands (Immediately Adjacent) Within 1/4 Mile 0.81 Over 1/4 Mile 0.50 Fringe Marsh (vs. Meadow) Tidal flats (vs. not significant) Adjacent Eelgrass (vs. no 0.49 eelgrass) Creeks (vs. no creeks) Channels (vs. no channels) Other Saltmarsh w/i 1/2 mi (vs. none) Cut point Cut point Cut point Cut point LnL N Note: significant at 99%; significant at 95%; significant at 90%.

5 1366 Number 5, 2002 Amer. J. Agr. Econ. Table 3. Results of Expert Survey Fish and Shellfish Marsh Marsh Resident Nonresident Overall Variable Fish Fish Fish Shellfish Size (1 Acre) 5 Acres Acres Acres Saltmarsh (Low) Medium High Adjacent Water Type (Salt Pond) Coastal River Coastal Embayment Tidal Restrictions (None) Medium Severe Percent Coverage by Pools (1%) 10% % Buffer Type (None) Shrub Percentage Land Development (Low) Medium 0.63 High Freshwater Wetlands (Immediately Adjacent) Within 1/4 Mile Over 1/4 Mile 0.38 Fringe Marsh (vs. Meadow) 0.43 Tidal flats (vs. not significant) Adjacent Eelgrass (vs. no eelgrass) Creeks (vs. no creeks) Channels (vs. no channels) 0.45 Other Saltmarsh w/i 1/2 mi. (vs. none) Cut point Cut point Cut point Cut point LnL N Note: significant at 99%; significant at 95%; significant at 90%. at p < Signs of coefficients are consistent with findings from the literature and expert interviews. While the results, as expected, differ across species group, there are some commonalities. For all species, parameter estimates associated with the size of the wetland were positive, relatively large and significant, while the estimate for the severe tidal restriction variable was negative and significant for all species. Also significant for a number of species groups are the relative quantity of salt marsh (spartinia sp.) acreage, coverage by open water pools, buffer type, presence of tidal flats, and level and type of development in the surrounding landscape. As expected, several attributes have a significant positive or negative impact on one species group, but have either an opposite or insignificant impact on other groups. Hence, actions taken to increase habitat quality for one species group may either decrease or leave unchanged habitat quality for other species groups. For example, for marsh-dependent songbirds, moderate coverage of a wetland with open water pools has a negative coefficient (i.e., negative impact on habitat potential), while for fish the coefficient is positive. Thus, restoration that affects open water pools would require habitat trade-offs involving songbirds and fish.

6 Johnston et al. Prioritizing Salt Marsh Restorations 1367 Conjoint Analysis of Preferences for Coastal Wetland Restoration The stated preference survey instrument Rhode Island Salt Marsh Restoration: 2001 Survey of Rhode Island Residents was designed to assess the relationship between salt marsh functions and public values. Survey development required over sixteen months and involved extensive background research, interviews with experts in salt marsh ecology and restoration, and over sixteen focus groups with more than 100 Rhode Island residents. Numerous pretests, including verbal protocol analysis (Schkade and Payne) were also conducted to ensure that the survey language and format could be easily understood by respondents, and that respondents shared interpretations of survey scenarios (cf. Johnston et al.). Focus groups and pretests led to a selfadministered, in-person survey approach that combined a printed survey booklet with an eight-minute introductory computer-based presentation. This presentation introduced respondents to information regarding salt marshes and salt marsh restoration; reminded respondents of the trade-offs involved in salt marsh restoration; reminded respondents of their budget constraint and the implications of choosing to direct funds to restoration programs; emphasized the importance of respondents choices; and provided basic survey instructions. The presentation script and graphics were pretested extensively, and iteratively revised along with the survey booklet. Following the general approach of Johnston, Swallow, and Weaver, the conjoint survey presented respondents with four sets of discrete choices, each involving two alternative, multiattribute restoration plans. Fractional factorial design was used to construct a range of survey questions with an orthogonal array of attribute levels, resulting in eighty contingent choice questions divided among twenty unique booklets. Attributes distinguishing plans were selected based on background research, expert interviews, and focus groups (table 4). Based on these attributes, respondents chose one of Table 4. Model Variables: Definitions and Summary Statistics Variable Mean Name Description (Std. Dev.) Neither Neither = 1 identifies Neither Plan selected (0.4714) Environ Membership in environmental organizations (0.3923) Taxgrp Membership in taxpayer associations (0.1510) Loincome Household income less than $35,000/yr (0.4301) Hiedu Greater than a four-year college degree (0.3856) Birds Improvement to bird populations (0 10 scale) (2.6072) Fish Improvement to fish populations (0 10 scale) (2.6530) Shellfish Improvement to shellfish populations (0 10 scale) (2.6518) Mosquito Control mosquito nuisance (0 10 scale) (2.6506) Size Size of restored salt marsh (4.3965) Pro access Indicated access should be somewhat limited or unlimited (0.3697) Con access Indicated that access should be severely limited or prohibited (0.3697) Platform Restoration provides viewing platforms (0.4187) Both Restoration provides both viewing platforms and trails (0.4153) Cost Annual cost of plan (increase in taxes) ( )

7 1368 Number 5, 2002 Amer. J. Agr. Econ. the two plans, or chose Neither Plan. In total, interviewers collected 661 completed surveys, providing complete and usable responses to 2341 individual contingent choice questions (89% of the potential 2644). Preference Model Results The conditional logit model was used for data analysis (table 5). The model is statistically significant at p < All individual parameter estimates are statistically significant at p < 0.05, with most significant at p < Signs of parameter estimates correspond with prior expectations derived from focus groups, where prior expectations exist. Respondents favor plans that restore larger salt marshes; improve bird, fish, and shellfish habitat; control mosquitoes; provide public access; and result in lower household cost. The likelihood of rejecting restoration (i.e., choosing neither plan) was smaller for members of environmental organizations; and larger for members of taxpayers organizations, lower income individuals, and highly educated individuals. All these effects are significant at a minimum of p < Comparing preferences for habitat improvements and mosquito control (all measured on a ten-point scale), respondents placed the greatest weight on mosquito control, followed by habitat improvements for shellfish, fish, and birds, respectively. From a statistical perspec- tive, parameter estimates for mosquito control, shellfish habitat, and fish habitat cannot be shown to differ at p < 0.10, based on asymptotic Wald tests (Judge et al.). Parameter estimates for bird habitat improvements may be shown to differ from those associated with mosquito control and shellfish habitat at p < 0.10 (Wald 2 = 3.61 and 3.28, df = 1). Model results also indicate that the provision of public access facilities is a positive attribute of salt marsh restoration plans, but only for those who feel that salt marsh access should be either somewhat limited or unlimited (pro access = 1; table 4). For these respondents, viewing platforms (table 4; platforms) are preferred to the lack thereof, and a combination of walking trails and viewing platforms (table 4; both) are preferred to platforms alone. Both effects are significant at p < 0.05, as indicated by the parameter estimates and standard errors for the interaction terms pro access platforms and pro access both (table 5). However, preliminary models (not shown here) indicated that neither effect was statistically significant at p < 0.10 for those who oppose public access; hence the interactions con access platforms and con access both were dropped from early versions of the model, and do not appear in table 5. These combined findings correspond with prior expectations drawn from focus groups of preference heterogeneity associated with the provision of salt marsh access facilities. Table 5. Conditional Logit Results Parameter Std. Estimate Error Z P> z Neither Option Neither Environ Neither Taxgrp Neither Loincome Neither Hiedu Birds Habitat Fish Habitat Shellfish Habitat Mosquito Control Size Pro Access Platform Pro Access Both Cost N LnL Prob > Pseudo R

8 Johnston et al. Prioritizing Salt Marsh Restorations 1369 Prioritizing Restoration Actions The expert and public surveys were designed in an integrated fashion, such that the models could be linked through respective habitat scales. Expert survey results indicate the potential for habitat on a 0 4 scale, based on professional, expert judgment. The public preference model, in turn, estimates welfare change as a function of habitat improvement, as judged by wetlands experts, measured on a0 10 scale. Accordingly, results from the expert survey may be treated as attributes within the public preference model, after adjustment for differences in measurement scales. The following example illustrates the integration of production and preference models to prioritize restoration projects. To simplify the exposition, we contrast two relatively simple restoration programs; however, more complex policies may be easily addressed. Table 6 characterizes a degraded coastal wetland and two potential restoration alternatives. The baseline (degraded) wetland consists of a 5-acre marsh dominated by Phragmites, with severe tidal restriction. Both of the presented restoration alternatives (table 6) reduce the tidal restriction, allowing for the development of a medium level of Spartinia marsh. However, under restoration Alternative 1, additional funds are used to excavate open pools (20% of marsh area), subtidal channels, and intertidal creeks. Under Alternative 2, funds would be used to create a 100 ft. buffer of shrub vegetation. All other plan attributes are assumed identical. Both alternatives increase expected habitat potential for birds, fish, and shellfish, relative to the degraded baseline. However, while Alternative 1 provides a relatively greater improvement in expected habitat potential for fish, Alternative 2 provides relatively greater improvement habitat potential for bird species (table 6). Public survey results (table 5) provide one means to resolve this potential tradeoff. After adjusting for differences in the scale used to assess habitat improvements (table 6), the associated changes in estimated habitat potential are substituted into the restoration preference function, estimated from public survey data (table 5). Welfare results of the combined model are summarized at the bottom of table 6. Incorporating the estimated habitat improvements Table 6. Example: Prioritization of Potential Restoration Programs Restoration Options a Degraded Marsh Alternative 1 Alternative 2 Attributes Size 5 acres NC NC Salt marsh area low medium medium Adjacent water salt pond NC NC Tidal restriction severe moderate moderate Percent coverage by open pools 1% 20% NC Vegetated buffer none NC shrub Percentage of surrounding upland developed high NC NC Nearest freshwater wetland within 1/4 mile NC NC Marsh shape/type fringe NC NC Adjacent tidal flats significant NC NC Eelgrass in adjacent waters none NC NC Intertidal creeks absent present NC Subtidal channels absent present NC Nearest salt marsh within 1/2 mile NC NC Expert survey results (implications for habitat potential) Expected habitat potential rating Birds Fish Shellfish Public survey results (welfare implications of habitat potential differences) Welfare Rating (Alternative 1 versus Alternative 2) b dv WTP (for Alternative 1 over Alternative 2) $13.96 a NC = No change relative to degraded wetland. b The 0 4 habitat potential scale in the expert survey is matched to the 0 10 habitat improvement scale in the public survey using a 10/4 adjustment factor.

9 1370 Number 5, 2002 Amer. J. Agr. Econ. into the preference model and comparing restoration Alternative 1 to Alternative 2 illustrates that predicted welfare is higher under Alternative 1, as indicated by dv>0. Model results imply that Alternative 1 would be favored in a referendum by 53% of residents (compared to 47% choosing Alternative 2), and the estimated willingness to pay (Hanemann) for Alternative 1 over Alternative 2 is $ Hence, the combined model would prioritize Alternative 1 over Alternative 2 as a restoration option for the baseline degraded site. Future work will incorporate this combined prioritization model with a menu-driven Geographic Information System interface, incorporating a database of salt marshes in Narragansett Bay, Rhode Island and a range of potential restoration actions that may be undertaken to improve each site. This interface will be designed to allow resource managers and stakeholders to explore, visualize, and prioritize different restoration alternative, in terms of both ecological and welfare implications. References Able, Kenneth W., and Stacy M. Hagan. Effects of Common Reed (Phragmites australis) Invasion on Marsh Surface Macrofauna: Response of Fishes and Decapod Crustaceans. Estuaries 23(2000): Bartoldus, C.C. A Comprehensive Review of Wetland Assessment Procedures: A Guide for Wetland Practitioners. St. Michaels, MD: Environmental Concern Inc., Burdick, D.M., M. Dionne, R.M. Bourmans, and F.T. Short. Ecological Responses to Tidal Restoration of Two Northern New England Salt Marshes. Wetlands Ecology and Manage. 4(1997): Hanemann, W.M. Welfare Evaluations in Contingent Valuation Experiments with Discrete Responses. Amer. J. Agr. Econ. 66(1984): Johnston, R.J., S.K. Swallow, and T.F. Weaver. Estimating Willingness to Pay and Resource Tradeoffs with Different Payment Mechanisms: An Evaluation of a Funding Guarantee for Watershed Management. J. Environ. Econ. and Manage. 38(1999): Johnston, R.J., T.F. Weaver, L.A. Smith, and S.K. Swallow. Contingent Valuation Focus Groups: Insights from Ethnographic Interview Techniques. Agr. Res. Econ. Rev. 24(1995): Judge, G.G., R.C. Hill, W.E. Griffiths, H. Lutkepohl, and T. Lee. Introduction to the Theory and Practice of Econometrics, 2nd ed. New York: John Wiley and Sons, King, Dennis M., Lisa A. Wainger, Candy C. Bartoldus, and James S. Wakeley. Expanding Wetland Assessment Procedures: Linking Indices of Wetland Functions with Services and Values. Washington DC: U.S. Army Corps of Engineers, Wetlands Research Program, ERDC/EL TR-00-17, September National Research Council. Restoration of Aquatic Ecosystems. Washington DC: National Academy Press, Schkade, D.A., and J.W. Payne. How People Respond to Contingent Valuation Questions: A Verbal Protocol Analysis of Willingness to Pay for an Environmental Regulation. J. Environ. Econ. and Manage. 26(1994): Shriver, W. Gregory, and Peter D. Vickery. Anthropogenic Effects on the Distribution and Abundance of Breeding Salt Marsh Birds in Long Island Sound and New England. Final Report to the Long Island Sound License Plate Program. Center for Biological Conservation, Massachusetts Audubon Society, Lincoln, MA, April 2001, p. 32. Wigand, C., R. Comeleo, R. McKinney, G. Thursby, M. Chintala, and Michael Charpentier. Outline of a New Approach to Evaluate Ecological Integrity of Salt Marshes. Human and Ecological Risk Assessment 7(2001):