Today's Wilmington Star News is chock full of local environmental/natural resource issues:
Titan Cement appeals SEPA ruling
House of Reps votes to prohibit funding for new "megaport"
Business leaders pushing for Skyway bridge
Local group wants more recycling on Pleasure Island
Rare leatherback turtle nest on Holden Beach
In preparation for Monday's exam, choose one of these issues and describe how a benefit-cost analysis might be useful for policy makers. What economic values would need to be measured and what valuation procedures might be useful?
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A good cost benefit analysis for the rare leatherback turtle nest in Holden beach would be the costs associated with moving the eggs and protecting them vs the cost of doing nothing. Obviously a couple hours spent moving the eggs to a more suitable location greatly outweighs the benefits of doing nothing. Protecting these eggs incorporates several non-use values. People are protecting an endangered species which has an existence value, because it is good to know that these turtles exist. Also, these turtles may have a bequest value, so that future generations will enjoy their existence.
What are the external damages from the Titan cement plant operations? What is the level of pollution output in monetary value?
The cost to society is the negative external damage to the air quality of the surrounding neighborhood and the overall effects on the global environment. The non-market values impacted by society are to be determined by the Army Corp of Engineers and as required by SEPA must come prior to the issuing of permits.
The market value would be the availability of cement for building. The equation for arriving at total society net gain would need to also include the benefits of reduced price of cement as a result of the reduced need to travel or ship the product from other locations. Perhaps competitive price reductions incurred with the addition of a new plant should be considered as well.
An understanding of the operations of a cement factory would need to be investigated and understood in order to reveal all costs and benefits. I suppose a contingent valuation method would be used to determine the value of clean air, but I don’t know anything about making or is it mining cement. A benefit cost analysis would be useful in order to determine what policies should be applied to the operating of the Titan Company further than the delay in permit issues already in place.
In the case of plans to build the Skyway bridge linking New Hanover and Brunswick counties a benefit-cost analysis is necessary to compare the value of not building the bridge with the potential value of the bridge construction.
Benefit-cost analysis will incorporate externalities such as social/environmental impacts as well as private economic costs and benefits. Discounting will be a valuable tool – since only time will tell when considering environmental impacts of a project years into the future. Since cost and benefits accrue over time, the future requires strong consideration.
Opportunity costs should also be taken into consideration. Is there a better use of the funds that would offer more benefits to society? Is there a more viable solution to elimination the traffic and accidents along that route?
Social, financial and environmental costs and benefits associated with this project must be identified and quantified and a decision will be made that hopefully will bring the greatest benefit to the area/society.
Another strong consideration should be if this bridge would be solving a short term problem (eliminate traffic) but creating a long term one (increase traffic, pollution, population, etc).
The value of this bridge project must be established by using indirect market measure of benefit and cost. This technique would, for instance, value the time spent in traffic to assess the value of increased spending on the bridge, it would value the cost of pollution and environmental damage due to increased vehicle traffic as well as increased port traffic from cruise ships and larger cargo vessels. It would consider the human value, weighing the number of accidents along the current route.
This bridge could potentially be one of the largest in the world, allowing larger tankers and cruise ships to pass underneath. What would this do to the value of the property in the area? Would this value or devalue the properties?
What would be the cost of displacing all of the residents that would need to move with the current plans for the bridge?
Since there will be a toll charged, how would this impact the local economy with the increased tax revenue? How would this bridge impact evacuation routes? Does not having this bridge limit the area’s economy from growing?
I would imagine that a benefit-cost analysis would look something like this:
Considerations:
Economy: will grow, with greater port activity, trade will grow. More revenue for the counties.
Jobs: More port activity, more cruise ships, will generate more jobs
Transportation: will improve daily commutes, recreational traffic, how will parking be affected in both counties by greater traffic, more tourists
Environment: Noise, traffic, pollution
An example of cost benefit for Pleasure Island would simply be more recycling versus not recycling more at all. It may cost Pleasure Island more to increase recycling but it would benefit the whole world! It is not too difficult of a task to do and the benefits definitely outweigh the cost for this example.
Local groups promoting more recycling on pleasure island-
I live on pleasure island and have just now and i know i should have been begun recycling. This issued has been pushed in the past but not on the level as it has been of late. We do need more recycling on the Island i'm with the others heading this commitee but i truely believe that in order to efficiently control this issue the community must push tourists to help in this effort. Most of our trash especally in the summer months and on a yearly basis from tourists is our problem. To find a way to benefit someone in recycling many times will make the ultimate difference. People many times have the attitude that this isn't where i live so just trash it. Maybe a little extreme there but you get my point.
One comment on the Sea turtle issue wanda i'm right there with you but without sponsors or donators the cost i believe will never exceed the benefit however i would love to see these guys make a comeback and would be interested in the helping on this issue. Volunteers are what's needed and they are hard to come by. Take Fisherman's Post (a local fishing magazine)for example. A the last tournament two weekends ago i discussed possible ways to improve fair fishing with a committe member. I thought with UNCW being right here with many students studying marine biology it shouldn't be a problem to have them weigh in fish and volunteer thier services for a fairer tournament. He said he had spoken with the University and no interest was given back to him. As a community i believe professors are aware of these types of events and in turn should want to provide these services if they are truely interested in fishing areas.
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