DRAFT ECONOMIC ANALYSIS

OF CRITICAL HABITAT DESIGNATION

FOR ELEVEN MOBILE RIVER BASIN MUSSELS














June 2003









DRAFT ECONOMIC ANALYSIS

OF CRITICAL HABITAT DESIGNATION

FOR ELEVEN MOBILE RIVER BASIN MUSSELS



Prepared for:


Division of Economics

U.S. Fish and Wildlife Service

4401 N. Fairfax Drive

Arlington, VA 22203





Prepared by:


Industrial Economics, Incorporated

2067 Massachusetts Avenue

Cambridge, Massachusetts 02140







Send comments on the economic analysis to:



Field Supervisor

U.S. Fish and Wildlife Service

6578 Dogwood View Parkway, Suite A

Jackson, MS 39213




TABLE OF CONTENTS


EXECUTIVE SUMMARY. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .ES-1



1        INTRODUCTION AND BACKGROUND. . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1-1

 

          1.1     Description of Species and Habitat. . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-2

          1.2     Proposed Critical Habitat. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1-3

          1.3     Framework and Methodology. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1-10

          1.4     Information Sources. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .1-22


2        SOCIOECONOMIC PROFILE AND BASELINE ELEMENTS. . . . . . . . . . . . . 2-1

 

          2.1     Socioeconomic Profile of the Critical Habitat Area. . . . . . . . . . . . . . . . .2-1

          2.2     Relevant Baseline Elements. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2-12

 

3        SECTION 7 ACTIVITIES WITHIN THE MUSSEL CRITICAL HABITAT DESIGNATION. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3-1


          3.1     Categories of Economic Impacts Associated with Section 7 Implementation. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3-1

          3.2     Activities Potentially Affected by Critical Habitat

                     Designation for the Mussels. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .3-4


4        ECONOMIC IMPACT OF CRITICAL HABITAT DESIGNATION. . . . . . . . . . . 4-1


          4.1     Estimated Total Costs of Section 7. . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-1

          4.2     Section 7 Activity Details Within Proposed Critical Habitat. . . . . . . . .4-11

          4.3     Estimated Technical Assistance Efforts. . . . . . . . . . . . . . . . . . . . . . . .4-38

          4.4     Other Regulatory Assessment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4-41


5        POTENTIAL BENEFITS OF PROPOSED CRITICAL HABITAT. . . . . . . . . . . 5-1

 

          5.1     Categories of Benefits. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5-2


          REFERENCES. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . .Ref-1


          APPENDIX A: State-level Baseline Protections to the Mussels and Habitat. .A-1


          APPENDIX B: Other Regulatory Assessments. . . . . . . . . . . . . . . . . . . . . . . . B-1


          APPENDIX C: Section 7 Costs for the Mussels Per Unit and Activity. . . . . . .C-1


EXECUTIVE SUMMARY

 

 

1.                 The purpose of this report is to identify and analyze the potential economic impacts that may result from the proposed critical habitat designation for the 11 Mobile River basin mussels (the mussels). This report was prepared by Industrial Economics, Incorporated (IEc), under contract to the U.S. Fish and Wildlife Service’s (Service) Division of Economics, and was delivered on June 23, 2003.

 

2.                 Section 4(b)(2) of the Endangered Species Act (Act) requires the Service to designate critical habitat on the basis of the best scientific data available, after taking into consideration the economic impact, and any other relevant impact, of specifying any particular area as critical habitat. The Service may exclude areas from critical habitat designation when the benefits of exclusion outweigh the benefits of including the areas within critical habitat, provided the exclusion will not result in extinction of the species.

 

 

Framework for the Analysis

 

3.                 The primary purpose of this analysis is to estimate the economic impact that will result from the designation of critical habitat for the mussels. Footnote This information is intended to assist the Secretary in making decisions about whether the benefits of excluding particular areas from the designation outweigh the benefits of including those areas in the designation. Footnote This economic analysis considers the economic efficiency effects that may result from the designation and addresses how the impacts of the designation are distributed, including an assessment of any local or regional economic impacts of the designation and the potential effects of the designation on small entities, the energy industry, or governments. This information can be used by decision-makers to assess whether the effects of the designation might unduly burden a particular group or economic sector.

 

4.                 OMB guidelines for conducting economic analysis of environmental regulation direct Federal agencies to measure the costs of a regulatory action against a baseline. Footnote The baseline includes the currently existing regulatory and socio-economic burden imposed on landowners and managers potentially affected by the designation of critical habitat including, for example, local zoning laws, state natural resource laws, and enforceable management plans and best management practices applied by other State and Federal agencies. Existing laws, regulations, and policies that offer baseline protections to the mussels are described in greater detail in Section 2 and Appendix A of this analysis.

 

5.                 This analysis describes impacts that are expected to occur above and beyond the baseline. In other words, it measures the costs of compliance with the Act that would not occur in the absence of the currently proposed critical habitat. Importantly, economic impacts associated with section 9 and 10 of the Act, with a few exceptions, are considered to be part of the regulatory baseline and thus are not addressed in this report. These costs are considered to be part of the baseline because they remain unaffected by the designation of critical habitat.

 

6.                 The measurement of direct compliance costs focuses on the implementation of section 7 of the Act. This section requires Federal agencies to consult with the Service to ensure that any action authorized, funded, or carried out will not likely jeopardize the continued existence of any endangered or threatened species or result in the destruction or adverse modification of critical habitat. The administrative costs of these consultations, along with the costs of project modifications resulting from these consultations, represent the direct compliance costs of designating critical habitat. Importantly, this analysis does not differentiate between consultations that result from the listing of the species (i.e., the jeopardy standard) and consultations that result from the presence of critical habitat (i.e., the adverse modification standard).

 

7.                 The designation may, under certain circumstances, affect actions that do not have a Federal nexus or are otherwise not subject to the provisions of section 7 under the Act. For example, although technical assistance is not a direct cost of section 7 of the Act, these costs are incorporated into the cost analysis when they are explicitly propagated by consideration of species and habitat conservation. Similarly, a State agency may request technical assistance from the Service as a precaution to ensure that activities without a Federal nexus, such as the issuance of National Pollutant Discharge Elimination System (NPDES) permits, adequately provide for particular species and habitats. In this case, costs of Service review of such activities would be included as a cost of critical habitat designation.

 

8.                 The analysis examines activities taking place both within and adjacent to the proposed designation. It estimates impacts based on activities that are “reasonably foreseeable," including, but not limited to, activities that are currently authorized, permitted, or funded, or for which proposed plans are currently available to the public. Accordingly, the analysis bases estimates on activities that are likely to occur within a ten year time frame, beginning on the day that the current proposed rule becomes available to the public. The ten-year time frame was chosen for the analysis because, as the time horizon for an economic analysis is expanded, the assumptions on which the projected numbers of projects are based become increasingly speculative.

 

9.                 This report relies on a sequential methodology and focuses on distilling the salient and relevant aspects of potential economic impacts of the proposed designation. The steps followed in this analysis consist of:

 

                   Describing current and projected economic activity within and around the proposed critical habitat area;

 

                   Identifying whether such activities are likely to involve a Federal nexus;

 

                   For activities with a Federal nexus, evaluating the likelihood that these activities will require consultations under section 7 of the Act and, in turn, result in any modifications to projects.

 

                   Estimating the direct costs of expected section 7 consultations, project modifications and other economic impacts associated with the designation;

 

                   Estimating the likelihood that current or future activities may require additional compliance with other Federal, State, and local laws as a result of new information provided by the proposed designation;

 

                   Estimating the likelihood that projects will be delayed by the consultation process or other regulatory requirements triggered by the designation;

 

                   Estimating the likelihood that economic activity will be affected by regulatory uncertainty, and/or property values affected;

 

                   Estimating the indirect costs of the designation, as reflected in the cost of compliance with State and local laws, project delays, regulatory uncertainty, and effects on property values;

 

                   Assessing the extent to which critical habitat designation will create costs for small businesses as a result of modifications or delays to projects;

 

                   Assessing the effects of administrative costs and project modifications on the supply, distribution, and use of energy; and

 

                   Determining the benefits that may be associated with the designation of critical habitat.

 

 

Key Findings

 

10.               Exhibit ES-1 provides an overview of the present value of total section 7 costs associated with the listing and designation of critical habitat for the mussels over a ten year period. Footnote As the exhibit shows, estimates of the costs associated with section 7 consultations for the mussels, discounted to present value using a rate of seven percent, range from $6.42 million to $23.5 million over a ten year period. This present value range equates to an annualized stream of costs of $914,000 to $3.35 million. This cost range represents the costs of the designation associated with section 7 consultations and resulting project modifications, and technical assistance efforts. The analysis did not identify any broader regional economic impacts or constraints on commerce beyond these costs.

 

Exhibit ES-1

 

SECTION 7 AND TECHNICAL ASSISTANCE COSTS ASSOCIATED WITH THE

LISTING AND DESIGNATION OF CRITICAL HABITAT FOR THE MUSSELS

 

Total Estimated Section 7 Costs

Nominal value of total section 7 costs (ten years)

$9.03 million to $33.3 million

Present Value (7% discount rate)

$6.42 million to $23.5 million

Annualized over ten years

$914,000 to $3.35 million

Present Value (3% discount rate)

$7.73 million to $28.5 million

Annualized over ten years

$907,000 to $3.34 million

Notes: Estimates are rounded to three significant digits. Costs may not add up due to rounding. These estimates include all section 7 costs, including both those associated with the species listing and designation of critical habitat for the mussels. Consultations costs known to occur in specific years are discounted accordingly; all remaining consultations costs are assumed to be evenly spread across the ten years.

 

 

11.               The general distribution of these costs by activity, unit, and party bearing them is as follows:

 •Costs by type of major activity. As detailed in Exhibit ES-2, a range of activities may be affected by the designation of critical habitat for the mussels. The majority of these costs, however, are expected to stem from consultations with the U.S. Army Corps of Engineers (USACE) and related project modifications concerning dredging activities. The primary area of uncertainty concerns water supply dam proposals in Alabama and Georgia. Any of these dam proposals may significantly affect critical habitat. If construction plans proceed on these dams, consultation will be required. Considerable uncertainty exists with respect to the level of project modification that may be recommended with respect to the permitting and construction of these dams, particularly regarding minimum flow recommendations.

 

         Costs by unit. As detailed in Exhibit ES-3, Units 16 and 25 are likely to engender the highest costs on a unit-by-unit basis. Within Units 16 and 25, these high costs result from the relatively large project modification costs that are forecast to occur related to the restriction of in-stream activity and infrastructure construction associated with road and bridge maintenance projects (i.e., constructing bridges that span streams in place of using instream pilings). These project modifications add approximately $300,000 each to seven informal consultations in Unit 16 and three informal consultations within Unit 25.

 

         Costs by type of entity. Approximately, 56 percent of total section 7 costs will be borne by third parties (e.g., local and State governmental agencies). Of the remaining costs, approximately six percent will be borne by the Service, and 38 percent by other Federal agencies.

 

         Costs by category. Administrative costs of consultations will generate a high end estimate of approximately 24 percent of total designation costs. Resulting project modifications are anticipated to account for 73 percent, and technical assistance accounts for approximately three percent of the total costs.

 

 

Detail of Section 7 Costs

 

12.               The following section first outlines costs by major activity affected by critical habitat designation, and then allocates these costs on a unit-by-unit basis. A detailed itemization of this cost information by activity, unit, type of entity, and category is provided in Appendix C.

 

 

 

          Costs By Major Activity

 

13.               The following discussion summarizes the activities anticipated to experience impacts due to designation of critical habitat for the mussels. Related consultations and project modification costs are summarized in Exhibit ES-2. Federal agencies that may consult with the Service concerning these activities include the Army Corps of Engineers (USACE), Natural Resources Conservation Service (NRCS), the Federal Highway Administration (through State Departments of Transportation (DOT)), Farm Service Agency (FSA), U.S. Environmental Protection Agency (EPA), the Tennessee Valley Authority (TVA), and the U.S. Forest Service (USFS).

 

         Road and bridge construction or maintenance. State DOTs and the USACE are expected to engage in 141 to 151 informal and 17 formal section 7 consultations regarding road/bridge construction and maintenance projects at a total cost of approximately $4.8 million to $10.1 million over the next ten years. Modifications to these projects may include such measures as increasing standards for erosion and sedimentation control, restricting in-stream construction, surveying for species, and relocating species for the duration of the project period. It is difficult to predict where these costs will occur throughout the designation. This analysis assumes that the third party (i.e., the local government) will absorb these increased costs.

 

         Hydropower. Operation of hydropower dams is anticipated to result in one informal and three formal consultations over the next ten years. Two of the formal consultations stem from the relicensing of hydro dams by FERC. One of these consultations is anticipated to bear project modification costs of approximately $484,000. The informal and remaining formal consultation will engage FERC and the USACE in discussion regarding the operation of a third hydropower dam. The total section 7 costs stemming from hydropower consultations may be up to $1.06 million over the next ten years.

 

         Water supply dams. Although it is unclear whether water supply dams will be permitted or constructed within the proposed critical habitat area within the next ten years, it is possible that the Service will consult formally on two proposals for such infrastructure. One of these dams was permitted through a past consultation. Designation of critical habitat within the dam footprint, however, is expected to result in reinitiation of this consultation. Costs for water supply dam consultations are anticipated to range from $515,000 to $546,000. Given the uncertainty concerning the level of project modification that may be recommended, both pertaining to critical habitat and other factors, this analysis does not quantify broader regional impacts associated with these consultations.

 

         Utilities Construction/Maintenance. Construction or maintenance of in-stream pipelines, transmission lines and other utility infrastructure is anticipated to result in ten informal and four formal consultations with the USACE and TVA, at a total cost of $358,000 to $3.2 million over the next ten years. This cost estimate is driven by the potential project modifications associated with USACE utility maintenance projects including potential costs for species surveys, mussel relocation, and habitat restoration.

 

         Activities in National Forests. This analysis anticipates that land disturbance activities in national forests, such as silviculture, or trail construction and maintenance, may result in 63 informal and four formal consultations over the next ten years. As consultations associated with such activities are not expected to result in project modifications, the total estimated costs of these consultations range from $238,000 to $965,000.

 

         Agriculture or Ranching-Related Activities. Agricultural or ranching activities that involve a Federal nexus will result in 35 to 38 informal and 6 formal consultations at a total cost of $239,000 to $748,000 over the next ten years.

 

         Water Quality Activities. EPA engages in section 7 consultation with the Service regarding water quality standards, to ensure that they are appropriately protective of endangered and threatened species. Specifically, this analysis anticipates 17 to 29 informal consultations and 20 formal consultations with the EPA related to water quality activities, at a total cost of $485,000 to $1,250,000 over the next ten years. Further, the Service may provide technical assistance for review of NPDES permits 400 to 460 times over the next ten years, adding $260,000 to $713,000 in administrative costs.

 

         Recreation and Conservation Activities. Recreation and conservation activities on private land may involve a Federal nexus through Federal funding from the Service’s Partners for Fish and Wildlife program or other beneficial activities, including funding of fish stocking programs. The USACE also anticipated accelerating it’s habitat restoration programs over the next ten years. This analysis accordingly anticipates 145 to 152 informal and one formal consultation with respect to conservation projects at a total cost of $506,000 to $2,500,000 over the next ten years. Although these activities are federally operated and therefore a cost of critical habitat due to the requirements of section 7, such activities are intended to be beneficial to the species and habitat in the long run.

 

         Dredging. The USACE anticipates engaging in eight formal and six informal consultations regarding dredging activities over the next ten years. Two of the formal consultations are associated with dredging of the Federal navigation channel on the Alabama River. One of these consultations may bear project modification costs of up to $8,245,000 dependant upon whether the Service will recommend purchase of upland disposal sites for dredge material. Due to potentially harmful geomorphic effects to mussels, however, the Service has stated that it does not intend to recommend upland disposal of dredge material in the Alabama River within the foreseeable future. In this case, project modification costs for dredging would be reduced by $8 million, and the nominal high-end cost of the proposed designation would be reduced to $25.3 million, a 24 percent reduction in total costs.

 

 

14.               The mussel critical habitat area is characterized by mostly private rural, and some suburban, lands. Agriculture and ranching are common land uses in the region. Based on extensive review of the consultation history and interviews with Federal and State agencies, however, economic impacts to farmers and ranchers are anticipated to be minimal. Agricultural and ranching-related consultations primarily involve Federal assistance for conservation programs (i.e., the Environmental Quality Incentives Program) and are unlikely to result in project modifications. Similarly, although coal mining and silviculture occur within the designation, these activities are already expected to follow best management practices (BMPs) required by the Action agencies, independent of section 7. Additionally, in the geographic region considered in this analysis, these activities lack a Federal nexus. As such, the designation of critical habitat is not anticipated to impact these activities.

 

 

 


Exhibit ES-2

 

ESTIMATED TOTAL ECONOMIC COSTS OF ASSOCIATED ACTIVITIES

(ten years)

Activity

No. of

 Consultations

Costs (thousands)

Approximate % of Total Cost

Informal

Formal

Informal Consultation

Formal Consultation

Project Modifications

Total Costs

Road and bridge construction/ maintenance

141 - 151

17

$411 - $2,100

$238 - $388

$4,190 - $7,650

$4,800 - $10,100

30

Hydropower facilities

1

3

$2.9 - $13.9

$43.4 - $75.4

$968

$1,010 - $1,060

3

Water supply dams

0

2

$0

$31.2 - $61.6

$484

$515 - $546

2

Utilities construction/maintenance

10

4

$34.6 - $153

$62.4 - $123

$262 - $2,940

$359 - $3,220

10

Forest Service activities

63

4

$183 - $876

$55.6 - $89.2

$0

$238 - $965

3

Agriculture and ranching

35 - 38

6

$104 - $535

$90.2 - $168

$44.9

$239 - $748

2

Water Quality

17 - 29

20

$50 - $405

$278 - $446

$127 - $395

$455 - $1,250

4

Conservation and Recreation

145 - 152

1

$468 - $2,228

$15.6 - $30.8

$21.8 - $245

$506 - $2,500

8

Dredging

6

8

$21.6 - $93.6

$125 - $246

$305 - $11,400

$452 - $11,800

35

 Technical Assistance

 

$409 - $1,100

3

TOTAL

418 - 450

65

$1,280 - $6,410

$939 - $1,630

$6,400 - $24,200

$9,030 - $33,300

100

Note: Numbers may not sum due to rounding. Percentages are calculated based on high-end estimate of cost range. Technical assistance efforts include private landowner assistance and interactions with non-Federal entities regarding designation of critical habitat, for example, Service review of state-issued NPDES permits.

Source: Based on past consultation records and conversations with Federal agencies potentially affected by the proposed critical habitat designation.

          Costs By Unit

 

15.               Exhibit ES-3 provides a per unit summary of the consultation, technical assistance, and project modification costs likely to be associated with the proposed critical habitat over a ten year period. A more detailed exhibit of unit costs by activity, unit, type of entity, and category is provided in Appendix C of this report. Note that insufficient information currently exists to associate all costs with explicit units. In instances where certain costs cannot be associated with specific units, the exhibit aggregates these costs across the relevant set of units (e.g., costs attributable jointly to units 18, 19, 20, and 22), or states (e.g., certain costs projected to be incurred across all units in Alabama, Mississippi, Georgia, or Tennessee). The check marks in the exhibit indicate what category of cost (i.e., administrative consultation costs, project modifications, or technical assistance) is forecast to be incurred in each unit.

 

 

 


Exhibit ES-3

 

SUMMARY OF SECTION 7 AND TECHNICAL

ASSISTANCE COSTS FOR THE MUSSELS

(over ten years)

Unit

Consultations

 

Project

Modifications

 

 

Technical Assistance

 

Estimated Range of

Total Costs

Allocated Costs

1

$207,000 to $1,280,000

2

$291,000 to $1,640,000

3

 

$119,000 to $295,000

4

 

$153,000 to $785,000

5

 

 

$10,100 to $45,100

6

 

 

$17,300 to $76,300

7

 

$42,700 to $337,000

8

 

 

$10,100 to $45,100

9

 

 

$10,100 to $45,100

10

 

 

$76,200 to $318,000

11

 

$510,000 to $560,000

12

 

$63,300 to $350,000

13

 

$91,600 to $625,000

14

 

$269,000 to $10,200,000

15

 

 

$20,200 to $90,200

16

$2,240,000 to $2,800,000

17

 

$66,800 to $411,000

18

 

$610,000 to $1,600,000

19

 

 

$10,100 to $45,100

20

 

$35,500 to $306,000

21

 

 

$10,100 to $45,100

22

 

 

$10,100 to $45,100

23

 

$35,500 to $306,000

24

 

 

$10,100 to $45,100

25

$1,870,000 to $3,200,000

26

 

 

$24,000 to $67,400

Unallocated Costs

Units 18, 19, 20, 22

 

 

$88,700 to $337,000

AL Units

    $1,860,000 to $6,500,000

MS Units

         •

 

$57,500 to $277,000

GA Units

         •

 

$50,600 to $283,000

TN Units

          •

 

 

$ 11,600 to $97,300

Multiple Units

 

$147,000 to $217,000

TOTAL SECTION 7 COSTS (ALL UNITS)

$9,030,000 to $33,300,000

Notes: “Allocated Costs” are associated with projects anticipated to occur within specific units where as “Unallocated Costs” are anticipated to occur with a subset of units, though specific location is not available. Costs anticipated within “Multiple Units” refer to anticipated costs that may occur anywhere within the proposed designation. These estimates include all section 7 costs, including those associated with the species listing and designation of critical habitat for the mussels. Technical assistance efforts include private landowner assistance and interactions with non-Federal entities regarding designation of critical habitat, for example, Service review of state-issued NPDES permits. Totals are rounded to three significant digits and may not sum due to rounding.

A more detailed outline of these section 7 costs is provided in Appendix C.

 

Benefits Associated with the Designation

 

16.               Various categories of benefit may derive from the listing of the mussels and the designation of critical habitat. For example, survival and recovery of the species may lead to enhanced existence values. In addition, protection of mussel habitat may produce benefits such as preservation of habitat suitable for recreational uses, improved water quality, and habitat improvement for other species.

 

17.               Insufficient information exists to quantify the benefits of habitat protection. Several studies published in the economics literature, however, have attempted to estimate the public’s willingness to pay for the designation of critical habitat for endangered species. While these studies do not predict the “willingness to pay” individuals would have for the protections afforded to the mussels’ habitat through critical habitat designation, they support the notion that preservation of mussel habitat may generate substantial benefits to the public.

 

Key Uncertainties

 

18.               Exhibit ES-4 presents the key assumptions of this economic analysis, as well as the potential direction of bias introduced by the assumptions. In addition, issues regarding allocation of costs may change. For example, certain consultations are anticipated to occur within a range of units (i.e., critical habitat units within Alabama), but cannot be accurately applied to any one specific unit. This caveat does not have an effect on the total costs anticipated from the designation, but rather the allocation of that cost across units.

 

 

Exhibit ES-4

 

CAVEATS TO THE ECONOMIC ANALYSIS

Key Assumption

Effect on Cost Estimate

Historic administrative consultation costs and specific project modifications are good predictors of future consultation costs.

+/-

The presence of other species (i.e., the tulotoma snail, etc.) has no effect upon the number of consultations or project modifications and, thus, all related costs are attributed to the mussels designation.

+

Project modification costs resulting from the relicensing of Weiss dam in Alabama (Unit 18), and the operations at Carters Reregulation dam in Georgia (Unit 25) are estimated using average costs incurred by power utilities nationwide to address wildlife concerns during the relicensing process.

+/-

Project modification costs associated with construction of the Tom Bevill water supply dam (Unit 11) may be approximated using project modification costs for the relicensing of the hydropower dams as both activities involve the similar impacts of concern (i.e., minimum flows, water quality, etc.).

+/-

Action agency Best Management Practices are baseline protections that are practiced consistently and as such, do not introduce additional costs to section 7 consultations.

-

- : This assumption may result in an underestimate of real costs.

+ : This assumption may result in an overestimate of real costs.

+/- : This assumption has an unknown effect on estimates.

 

 

19.               The above caveats describe factors that introduce uncertainty into the results of this analysis. The Service therefore solicits from the public further information on any of the issues presented above. Additionally, information pertaining to the following questions is requested.

 

                   Are data available to develop more accurate estimates of the costs of project modifications related to the relicensing of Weiss dam and operations at Carters Reregulation Dam(See Sections 3.2.2 and 4.2.2 for further detail concerning this issue)?

 

                   Are data available to discern the likelihood that the proposed water supply dams will be constructed within critical habitat (see Sections 3.2.3 and 4.2.3 for additional detail concerning these dams)? Further, is information available regarding the costs of potential project modifications for construction of these dams?

 

                   Are data available on additional land use practices, or current or planned activities in proposed critical habitat areas, that are not specifically or adequately addressed in this analysis?

 

                   Are data available detailing additional specific benefits of the species or habitat that may be incorporated qualitatively or quantitatively into the discussion of benefits?

 

 












INTRODUCTION AND BACKGROUND                                                    SECTION 1




 

20.               On March 26, 2003, the U.S. Fish and Wildlife Service (Service) proposed to designate 26 river and stream segments (units), totaling approximately 1,760 kilometers (km) (1,093 miles (mi)) as critical habitat for 11 mussels in the Mobile River basin in the States of Alabama, Georgia, Mississippi, and Tennessee. The purpose of this report is to identify and analyze potential economic impacts that may result from the proposed critical habitat designation. This report was prepared by Industrial Economics, Incorporated (IEc), under contract to the Service’s Division of Economics, and was delivered on June 23, 2003.

 

21.               Section 4(b)(2) of the Endangered Species Act (the Act) requires the Service to designate critical habitat on the basis of the best scientific data available, after taking into consideration the economic impact, and any other relevant impact, of specifying any particular area as critical habitat. The Service may exclude areas from critical habitat designation when the benefits of exclusion outweigh the benefits of including the areas within critical habitat, provided the exclusion will not result in extinction of the species.

 

22.               Under the listing of a species, section 7(a)(2) of the Act requires Federal agencies to consult with the Service in order to ensure that activities they fund, authorize, permit, or carry out are not likely to jeopardize the continued existence of the species. The Service defines jeopardy as any action that would appreciably reduce the likelihood of both the survival and recovery of the species. For designated critical habitat, section 7(a)(2) also requires Federal agencies to consult with the Service to ensure that activities they fund, authorize, permit, or carry out do not result in destruction or adverse modification of critical habitat. Adverse modification of critical habitat is currently construed as any direct or indirect alteration that appreciably diminishes the value of critical habitat for conservation of a listed species.




1.1     Description of Species and Habitat Footnote

 

23.               The 11 mussels are in the family Unionidae, and are typically found embedded in the bottom of rivers and streams within the Mobile River Basin. These species siphon water into their shells and across their gills, which are specialized for respiration and food collection. Mussel larvae (glochidia) require a parasitic stage on the fins, gills, or skin of host fish species in order to change into juvenile mussels. Footnote The following list provides the common and scientific names of the 11 mussels.

 

                   Fine-lined pocketbook (Lampsilis altilis)

 

                   Orange-nacre mucket (Lampsilis perovalis)

 

                   Alabama moccasinshell (Medionidus acutissimus)

 

                   Coosa moccasinshell (Medionidus parvulus)

 

                   Ovate clubshell (Pleurobema perovatum)

 

                   Southern clubshell (Pleurobema decisum)

 

                   Dark pigtoe (Pleurobema furvum)

 

                   Southern pigtoe (Pleurobema georgianum)

 

                   Triangular kidneyshell (Ptychobranchus greenii)

 

                   Upland combshell (Epioblasma metastriata)

 

                   Southern acornshell (Epioblasma othcaloogensis)

 

24.               Historically, the mussels were widespread and abundant throughout the Mobile River Basin. Available suitable habitat for the these species, however, has been substantially reduced. Three of the species were listed as threatened, and eight as endangered under the Act on March 17, 1993. The species now primarily exist in isolated populations due to impacts from habitat degradation and modification from dams, dredging, mining, pollution, and introduced predaceous fishes. Habitat fragmentation and modification resulting from siltation, reduced water quality, tributary impoundment, stream channelization, and changes in stream hydrology continue to threaten the species.

 

25.               In determining which areas to propose as critical habitat, the Service must focus on those physical and biological features that are essential to the conservation of the species and that may require special management consideration or protection. These essential features are referred to as the species’ primary constituent elements (PCEs). The following are the PCEs that the Service has identified as essential to the conservation of the 11 mussels.

 

                   Geomorphically stable stream and river channels and banks;

 

                   A flow regime (i.e., the magnitude, frequency, duration, and seasonality of discharge over time) necessary for normal behavior, growth, and survival of all life stages of mussels and their fish hosts in the river environment;

 

                   Water quality, including temperature, pH, hardness, turbidity, oxygen content, and other chemical characteristics, necessary for normal behavior, growth, and viability of all life stages;

 

                   Sand, gravel, and/or cobble substrates with low to moderate amounts of fine sediment, low amounts of attached filamentous algae, and other physical and chemical characteristics necessary for normal behavior, growth, and viability of all life stages;

 

                   Fish hosts with adequate living, foraging, and spawning areas; and

 

                   Few or no competitive nonnative species present.

 

The Service considers these PCEs to facilitate delineation of potential critical habitat units for the mussels. One or more of the primary constituent elements must exist in the proposed areas to ensure a potential for the species to exist within each portion of the designation.


 

1.2     Proposed Critical Habitat

 

26.               The Service has proposed to designate 26 stream and river segments (units), representing approximately 1,760 kms (1,093 mi) of rivers and streams in the States of Alabama, Georgia, Mississippi, and Tennessee as critical habitat for the 11 mussels. The proposed designation includes portions of the Tombigbee River drainage in Mississippi and Alabama; Black Warrior River drainage in Alabama; Alabama River drainage in Alabama; Tallapoosa River drainage in Alabama and Georgia; and Coosa River drainage in Alabama, Georgia, and Tennessee.

 

27.               Lands proposed as critical habitat are under Federal, State, local government, and private ownership. Approximately 897 miles (1,440 km), or 82 percent of the proposed critical habitat is bordered by privately-owned lands. The critical habitat units run through portions of 31 counties in the four states.

 

28.               Within each unit, the Service proposes to designate the stream and river channels within the ordinary high water line. Background information on each critical habitat unit is provided in Exhibit 1-1, followed by further detailed information describing the units.



Exhibit 1-1


PROPOSED CRITICAL HABITAT FOR ELEVEN MOBILE RIVER BASIN MUSSELS:

DESCRIPTIONS OF UNITS

Unit

Drainage and Region

River Miles

Counties

Species for which Unit is Critical Habitat

Unit Landscape

 

Upper Tombigbee River Drainage

 

 

 

 

1

East Fork Tombigbee River

16

Monroe and Itawamba Counties, MS

Alabama moccasinshell, orange-nacre mucket, ovate clubshell, southern clubshell

Mostly private, rural land. Approx. 25% of stream miles runs through federally-owned Canal Section Wildlife Management Area. Silviculture and agriculture present.

2

Bull Mountain Creek

21

Itawamba County, MS

Alabama moccasinshell, orange-nacre mucket,ovate clubshell, southern clubshell

Entirely private, rural land. Silviculture present in immediate flood plain.

3

Buttahatchee River and tributary

68

Monroe and Lowndes Counties, MS; Lamar County, AL

Alabama moccasinshell, orange-nacre mucket,ovate clubshell, southern clubshell

Private, rural land.

4

Luxapalila Creek and tributary

18

Columbus and Lowndes Counties, MS; Lamar County, AL

Alabama moccasinshell, orange-nacre mucket,ovate clubshell, southern clubshell

Privately-owned. High human population density downstream. Rural, agricultural lands upstream. Power plants and mining for sand/gravel present.

5

Coalfire Creek

20

Pickens County, AL

Alabama moccasinshell, orange-nacre mucket,ovate clubshell, southern clubshell

Privately-owned. 90% forest land.

6

Lubbub Creek

19

Pickens County, AL

Alabama moccasinshell, orange-nacre mucket,ovate clubshell, southern clubshell

Transportation corridor. Several small communities, scattered agricultural lands.

7

Sipsey River

56

Green, Pickens, and Tuscaloosa Counties, AL

Alabama moccasinshell, orange-nacre mucket,ovate clubshell, southern clubshell

Privately-owned, except approx. 18% of stream miles, which runs through federally-owned Sipsey River Natural Area. Remote, sparsely populated wetlands. Limited commercial development.

8

Trussels Creek

13

Greene County, AL

Alabama moccasinshell, orange-nacre mucket,ovate clubshell, southern clubshell

Private, remote forest lands. Portion runs through small community.

9

Sucarnoochee River

56

Sumter County, AL

Alabama moccasinshell, orange-nacre mucket,ovate clubshell, southern clubshell

Remote, sparsely populated. Downstream from several communities.

 

Black Warrior River Drainage

 

 

 

 

10

Sipsey Fork Drainage

91

Winston and Lawrence Counties, AL

Alabama moccasinshell, orange-nacre mucket, dark pigtoe, ovate clubshell, triangular kidneyshell

Approx. 90% of unit is part of federally-owned William B. Bankhead National Forest. Agricultural lands located upstream.

11

North River and tributary

29

Tuscaloosa and Fayette Counties, AL

Alabama moccasinshell, orange-nacre mucket, dark pigtoe, ovate clubshell, triangular kidneyshell

Mostly sparsely populated, privately-owned lands. Populated community downstream. Impoundment proposed upstream.

12

Locust Fork and tributary

63

Jefferson and Blount Counties, AL

Alabama moccasinshell, orange-nacre mucket, dark pigtoe, ovate clubshell, triangular kidneyshell, upland combshell

Subject to urbanization and industrialization in southern portion. Intensive agricultural lands and poultry farms in northern portion.

 

Cahaba River Drainage

 

 

 

 

13

Cahaba River and tributary

77

Bibb and Jefferson Counties, AL

Alabama moccasinshell, fine-lined pocketbook, orange-nacre mucket, ovate clubshell, southern clubshell, triangular kidneyshell, southern acornshell, upland combshell

Highly urbanized with significant residential and commercial development pressure. Small portions lie within federally-owned Cahaba River National Wildlife Refuge and state-owned Cahaba River Wildlife Management Area. Listed on 303D as impaired waters due to sediment and nutrient overload. Portions designated as Outstanding Alabama Waters.

 

Alabama River Drainage

 

 

 

 

14

Alabama River

45

Dallas and Lowndes Counties, AL

orange-nacre mucket, southern clubshell

Privately-owned. Runs through one community. Moderate recreational navigation and some hydro power damming present.

15

Bogue Chitto Creek

32

Dallas County, AL

Alabama moccasinshell, orange-nacre mucket, southern clubshell

Privately-owned, rural pasture and agricultural land with some forest land.

 

Tallapoosa River Drainage

 

 

 

 

16

Tallapoosa River and tributary

100

Cleburne County, Alabama; Paulding County, GA

fine-lined pocketbook

Approx. 70% forest land with a few scattered communities. Reservoir proposed for Beech Creek., including extensive withdrawal from the Tallapoosa River.

17

Uphapee/Choctafaula/Chewacla Creeks

46

Macon and Lee Counties, AL

fine-lined pocketbook, ovate clubshell, southern clubshell

Approx. 31% lies within federally-owned Tuskegee National Forest. Subject to suburbanization. Two cities downstream. Limestone quarries and coal mining present. Turf farms border the designation.

 

Coosa River Drainage

 

 

 

 

18

Coosa River (Old River Channel) and tributary

48

Cherokee and Cleburne Counties, AL

fine-lined pocketbook, Coosa moccasinshell, ovate clubshell, southern clubshell, southern pigtoe, triangular kidneyshell, southern acornshell, upland combshell

Runs through medium-sized town, otherwise forest lands. Approx. 19% of stream miles runs through federally-owned Talladega National Forest. Agriculture downstream. Hydro power dam present on river.

19

Hatchet Creek

41

Coosa and Clay Counties, AL

fine-lined pocketbook, Coosa moccasinshell, ovate clubshell, southern clubshell, southern pigtoe, triangular kidneyshell, southern acornshell, upland combshell

Mostly forest lands. Approx. 17% lies within Talladega National Forest. Designated as Outstanding Alabama Waters. Habitat for endangered Tulotoma snail.

20

Shoal Creek

16

Calhoun and Cleburne Counties, AL

fine-lined pocketbook, Coosa moccasinshell, southern pigtoe, triangular kidneyshell

Entirely within Talladega National Forest. Isolated forest land with some recreational use (horse trails and off road vehicle access).

21

Kelly Creek and tributary

21

St. Claire and Shelby Counties, AL

fine-lined pocketbook, Coosa moccasinshell, ovate clubshell, southern clubshell, southern pigtoe, triangular kidneyshell, southern acornshell, upland combshell

Entirely privately-owned, forest land. Close proximity to major city. Subject to suburbanization. Turf farms border the southern portion of designation. Habitat for endangered Tulotoma snail.

22

Cheaha Creek

17

Talladega and Clay Counties, AL

fine-lined pocketbook, Coosa moccasinshell, southern pigtoe, triangular kidneyshell

Approx. 41% runs through Talladega National Forest. Major transportation corridor, croplands, fallow pasture in southern portion. Habitat for endangered Tulotoma snail.

23

Yellowleaf Creek and tributary

24

Shelby County, AL

fine-lined pocketbook, Coosa moccasinshell, southern pigtoe, triangular kidneyshell

In vicinity of major city. Subject to modernization. Impounded water and one power plant present. Habitat for endangered Tulotoma snail.

24

Big Canoe Creek

18

St. Claire and Etowah Counties, AL

fine-lined pocketbook, Coosa moccasinshell, ovate clubshell, southern clubshell, southern pigtoe, triangular kidneyshell, southern acornshell, upland combshell

Rural, privately-owned lands with some small communities.

25

Oostanaula River/Coosawattee River/ Conasauga River/ Holly Creek

128

Floyd, Murray and Gordon Counties, GA; Bradley and Polk Counties, TN

Alabama moccasinshell, fine-lined pocketbook, Coosa moccasinshell, ovate clubshell, southern clubshell, southern pigtoe, triangular kidneyshell, southern acornshell, upland combshell

Approx. 9% runs through federally-owned Chattanoochee National Forest (GA)/ Cherokee National Forest (TN). Mostly agricultural land. Subject to some development pressure.

26

Lower Coosa River

8

Elmore County, AL

Alabama moccasinshell, fine-lined pocketbook, Coosa moccasinshell, ovate clubshell, southern clubshell, southern pigtoe, triangular kidneyshell, southern acornshell, upland combshell

Unoccupied habitat, but among the species’ historical ranges. Considered an appropriate area for reintroduction. Also habitat for endangered Tulotoma snail.

Source: Proposed Designation of Critical Habitat for Three Threatened Mussels and Eight Endangered Mussels in the Mobile River Basin, March 26, 2003 (68 FR 14752).




1.3     Framework and Methodology

 

29.               The primary purpose of this analysis is to estimate the economic impact that will result from the designation of critical habitat for the mussels. Footnote This information is intended to assist the Secretary in making decisions about whether the benefits of excluding particular areas from the designation outweigh the benefits of including those areas in the designation. Footnote In addition, this information allows the Service to address the requirements of Executive Orders 12866 and 13211, the Regulatory Flexibility Act (RFA), as amended by the Small Business Regulatory Enforcement Fairness Act (SBREFA), and the Unfunded Mandates Reform Act (UMRA). Footnote

 

30.               This chapter provides the framework for this analysis. First, it defines the economic effects considered in the analysis. Second, it establishes the baseline against which these effects are measured. Third, it describes the measurement of direct compliance costs, which include costs associated with, and generated as a result of, section 7 consultations. Fourth, it identifies potential indirect economic effects of the rule resulting from (1) compliance with other parts of the Act potentially triggered by critical habitat, (2) compliance with other laws, and (3) time delays and regulatory uncertainty. Fifth, it discusses the need for an economic assessment of the benefits of critical habitat designation. Finally, the section concludes by discussing the time frame for the analysis and the general steps followed in the analysis.


          1.3.1  Types of Economic Effects Considered

 

31.               This economic analysis considers both the economic efficiency and distributional effects that may result from the designation. In the case of critical habitat designation, economic efficiency effects generally reflect the “opportunity costs” associated with the commitment of resources required to comply with the Act. For example, if activities on private land are limited as a result of a designation, and thus the market value of the land reduced, this reduction in value represents one measure of opportunity cost or change in economic efficiency. Similarly, the costs incurred by a Federal Action agency to consult with the Service under section 7 represent opportunity costs of the designation.

 

32.               This analysis also addresses how the impacts of the designation are distributed, including an assessment of any local or regional economic impacts of the designation and the potential effects of the designation on small entities, the energy industry, or governments. This information can be used by decision-makers to assess whether the effects of the designation might unduly burden a particular group or economic sector.

 

33.               For example, while the designation may have a relatively small impact when measured in terms of changes in economic efficiency, individuals employed in a particular sector of the economy in the geographic area of the designation may experience relatively greater effects. The difference between economic efficiency effects and distributional effects, as well as their application in this analysis, are discussed in greater detail below.


                     Efficiency Effects

 

34.               At the guidance of the Office of Management and Budget (OMB) and in compliance with Executive Order 12866 “Regulatory Planning and Review,” Federal agencies measure changes in economic efficiency in order to understand how society, as a whole, will be affected by a regulatory action. Footnote In the context of this regulatory action, these efficiency effects represent the opportunity cost of resources used or benefits foregone by society as a result of critical habitat designation. Economists generally characterize opportunity costs in terms of changes in producer and consumer surpluses in affected markets. Footnote

 

35.               In some instances, compliance costs may provide a reasonable approximation for the efficiency effects associated with a regulatory action. For example, a landowner or manager may need to enter into a consultation with the Service to ensure that a particular activity will not adversely modify critical habitat. The effort required for the consultation represents an economic opportunity cost, because the landowner or manager’s time and effort would have been spent in an alternative activity had the parcel not been included in the designation. When compliance activity is not expected to significantly affect markets -- that is, not result in a shift in the quantity of a good or service provided at a given price, or in the quantity of a good or service demanded given a change in price -- the measurement of compliance costs can provide a reasonable estimate of the change in economic efficiency.

 

36.               Where a designation is expected to significantly impact a market, it may be necessary to estimate changes in producer and consumer surpluses. For example, a designation that precludes the development of large areas of land may shift the price and quantity of housing supplied in a region. In this case, changes in economic efficiency can be measured by considering changes in producer and consumer surplus in the real estate market.

 

37.               This analysis begins by measuring reasonably foreseeable compliance costs resulting from the designation. As noted above, in some cases, compliance costs can provide a reasonable estimate of changes in economic efficiency. However, if the designation is expected to significantly impact markets, the analysis will consider potential changes in consumer and/or producer surplus in affected markets.


                     Distributional and Regional Economic Effects

 

38.               Measurements of changes in economic efficiency focus on the net impact of the regulation, without consideration for how certain economic sectors or groups of people are affected. Thus, a discussion of efficiency effects alone may miss important distributional considerations concerning groups that may be disproportionately affected. OMB encourages Federal agencies to consider distributional effects separately from efficiency effects. Footnote This analysis considers several types of distributional effects, including impacts on small entities; impacts on energy supply distribution and use; impacts on governments; and regional economic impacts. It is important to note that these are fundamentally different measures of economic impact than efficiency effects, and thus cannot be added to or compared with estimates of changes in economic efficiency.


                     Impacts on Small Entities, Energy Supply, Distribution and Use, and Governments

 

39.               This analysis considers how small entities, including small businesses, organizations, and governments, as defined by the RFA, might be affected by critical habitat designation. Footnote In addition, in response to Executive Order 13211 “Actions Concerning Regulations That Significantly Affect Energy Supply, Distribution, or Use,” this analysis considers the impacts of critical habitat on the energy industry and its customers. Footnote Finally, in accordance with UMRA, this analysis considers the effects of the regulatory action on State, local, and tribal governments and the private sector. Footnote


                     Regional Economic Effects

 

40.               Regional economic impact analysis provides an assessment of the potential localized effects of critical habitat designation. Specifically, regional economic impact analysis produces a quantitative estimate of the potential magnitude of the initial change in the regional economy resulting from a regulatory action. Regional economic impacts are commonly measured using regional input/output models. These models rely on multipliers that mathematically represent the relationship between a change in one sector of the economy (e.g., hydroelectric power generation) and the effect of that change on economic output, income, or employment in other local industries (e.g., manufacturers relying on the electricity generated). These economic data provide a quantitative estimate of the magnitude of shifts of jobs and revenues in the local economy.

 

41.               The use of regional input/output models in an analysis of the impacts of critical habitat can overstate the long-term impacts of a regulatory change. Most importantly, these models provide a static view of the economy of a region. That is, they measure the initial impact of a regulatory change on an economy but do not consider long-term adjustments that the economy will make in response to this change. For example, these models provide estimates of the number of jobs lost as a result of a regulatory change, but do not consider re-employment of these individuals over time. In addition, the flow of goods and services across the regional boundaries defined in the model may change as a result of the designation, compensating for a potential decrease in economic activity within the region.

42.               Despite these and other limitations, in certain circumstances regional economic impact analysis may provide useful information about the scale and scope of localized impacts. It is important to remember that measures of regional economic effects generally reflect shifts in resource use rather than efficiency losses. These types of distributional effects, therefore, should be reported separately from efficiency effects (i.e., not summed). In addition, measures of regional economic impact cannot be compared with estimates of efficiency effects.




          1.3.2  Defining the Baseline

 

43.               OMB guidelines for conducting economic analysis of environmental regulation direct Federal agencies to measure the costs of a regulatory action against a baseline. Footnote In its guidance, OMB states, the "baseline should be the best assessment of the way the world would look absent the proposed action" (i.e., absent the designation of critical habitat). In other words, the baseline includes the currently existing regulatory and socio-economic burden imposed on landowners and managers potentially affected by the designation of critical habitat. The baseline burden may include, for example:


                   Local zoning laws;


                   State natural resource laws;


                   Enforceable management plans and best management practices applied by other State and Federal agencies;


                   Federal, State, and local protections already in place in the same geographic area for other (Federal and State) listed species; Footnote and/or


                   Statutory protections provided for the species by the Act that exist in the absence of designated critical habitat.

 

Existing baseline laws, regulations, and policies are described in greater detail in Section 2 and Appendix A of this analysis.

 

44.               This analysis describes impacts that are expected to occur above and beyond the baseline. In other words, it measures the costs of compliance with the Act that would not occur in the absence of the currently proposed critical habitat. Importantly, economic impacts associated with section 9 and 10 of the Act, with a few exceptions, are considered to be part of the regulatory baseline and thus are not addressed in this report. These costs are considered to be part of the baseline because they remain unaffected by the designation of critical habitat.




          1.3.3  Direct Compliance Costs Associated With Section 7 of the Act

 

45.               The measurement of direct compliance costs focuses on the implementation of section 7 of the Act. This section requires Federal agencies to consult with the Service to ensure that any action authorized, funded, or carried out will not likely jeopardize the continued existence of any endangered or threatened species or result in the destruction or adverse modification of critical habitat. The administrative costs of these consultations, along with the costs of project modifications resulting from these consultations, represent the direct compliance costs of designating critical habitat.

 

46.               This analysis does not differentiate between consultations that result from the listing of the species (i.e., the jeopardy standard) and consultations that result from the presence of critical habitat (i.e., the adverse modification standard). Consultations resulting from the listing of the species, or project modifications meant specifically to protect the species as opposed to its habitat, may occur even in the absence of critical habitat. However, in 2001, the U.S. 10th Circuit Court of Appeals instructed the Service to conduct a full analysis of all of the economic impacts of critical habitat designation, regardless of whether those impacts are attributable co-extensively to other causes. Footnote Given the similarity in regulatory definitions between the terms “jeopardy” and “adverse modification,” in practice it can be difficult to pre-determine the standard that drives a section 7 consultation. Consequently, in an effort to ensure that this economic analysis complies with the instructions of the 10th Circuit as well as to ensure that no costs of the proposed designation are omitted, the potential effects associated with all section 7 impacts in or near proposed critical habitat are fully considered. In doing so, the analysis ensures that any critical habitat impacts that are co-extensive with the listing of the species are not overlooked. As a result, this analysis likely overstates the regulatory effects under section 7 attributable to the proposed designation of critical habitat.


          1.3.4  Indirect Costs

 

47.               The designation may, under certain circumstances, affect actions that do not have a Federal nexus or are otherwise not subject to the provisions of section 7 under the Act. The potential exists for several types of such indirect effects: three examples are discussed in this section. First, some landowners may voluntarily elect to complete a habitat conservation plan (HCP) in response to having their land designated as critical habitat. Second, some State laws may require landowners and managers to consider the effects of their actions on sensitive species and habitat. Thus, designation of critical habitat could trigger additional regulatory burden due to new information provided by the designation. Third, the consultation process may result in time delays for upcoming or ongoing projects, and the designation may foster regulatory uncertainty for prospective projects. If such additional efforts would not have occurred in the absence of critical habitat (i.e., “but for” critical habitat), then they are considered by this analysis to be an impact of the designation. The three most common categories of indirect effects are discussed further below.


                     Creation of Habitat Conservation Plans (HCPs)

 

48.               Under section 10(a)(1)(B) of the Act, a non-Federal entity (i.e., a landowner or local government) may develop an HCP for an endangered animal species in order to meet the conditions for issuance of an incidental take permit in connection with the development and management of a property. Footnote The HCP intends to counterbalance potential harmful effects that a proposed activity may have on a species, while allowing the otherwise lawful activity to proceed. As such, the purpose of the habitat conservation planning process is to ensure that the effects of incidental take are adequately minimized and mitigated. Thus, HCPs are developed to ensure compliance with section 9 of the Act and to meet the requirements of section 10 of the Act. HCPs are not necessarily precipitated by a critical habitat designation.

 

49.               However, a connection may exist between the creation of HCPs and the costs these plans impose and the designation of critical habitat. The Service, being a Federal entity, must formally consider whether an HCP will jeopardize a listed species or adversely modify its designated critical habitat before approving the plan. This review process may be a direct impact under section 7 of the Act. However, in certain circumstances, the effort involved in creating the HCP and associated conservation actions may also generate indirect effects associated with the designation of critical habitat. For example, in one past instance, landowners preemptively developed HCPs in an effort to avoid having their property designated as critical habitat. Footnote In this case, the effort involved in creating the HCP and undertaking associated conservation actions were considered to be an effect of designation Footnote .

 

50.               The following scenarios regarding HCP creation provide general guidance regarding the degree to which associated costs should be considered within the context of a critical habitat economic analysis:

 

                   In cases in which an HCP existed prior to a proposed designation, the costs of developing the HCP and the added costs of management imposed by the HCP should not be considered in the analysis of the effects of the designation. These costs are appropriately considered to be part of the regulatory baseline, because their creation was driven by the listing of the species and the need to avoid take, which is prohibited under section 9 of the Act. However, in cases where designated critical habitat overlaps with completed HCPs, the economic analysis will need to consider the cost to the Service to re-consult on the plan’s impact to critical habitat and whether or not this process may result in additional conservation actions.

 

                   In cases in which an HCP is proposed, or reasonably foreseeable absent the designation of critical habitat, the administrative costs associated with the required internal section 7 consultation should be included in the economic analysis of total section 7 costs, because the Service will need to consider the effects of the plan on designated critical habitat. In addition, if as a result of the designation additional project modifications will be recommended by the Service and incorporated into the HCP in order to avoid adversely modifying critical habitat, the costs of these project modifications should also be included in the economic analysis of critical habitat. Footnote

 

                   In cases in which development of one or more HCPs can be documented as being precipitated by critical habitat designation (i.e., to avoid designation or to reduce the costs of the designation), the costs of development of the HCP and the added costs of management imposed by the HCP should be included in the critical habitat economic analysis. In such cases the analysis should be presented with appropriate caveats as to the uncertainty regarding the extent to which the HCP would have existed absent critical habitat designation.

 

 

 

                     Other State and Local Laws

 

51.               Under certain circumstances, the designation of critical habitat may provide new information to a community about the sensitive ecological nature of a geographic region, potentially triggering additional economic impacts under other State or local laws. In cases where these costs would not have been triggered “but for” the designation of critical habitat, they are included in this economic analysis.

 

52.               For example, the California Environmental Quality Act (CEQA) requires that lead agencies -- public agencies responsible for project approval -- consider the environmental effects of proposed projects that are considered discretionary in nature and not categorically or statutorily exempt. Among other effects, the CEQA statutes specifically require lead agencies to consider a project’s effects on rare or endangered plant and animal communities. To approve qualifying projects, lead agencies must require applicants, who are not “categorically exempt,” to mitigate effects to less than significant levels for projects that are not granted a “statement of overriding considerations.” Footnote

 

53.               In some instances, the designation of critical habitat can have an indirect effect on CEQA- related requirements. This is most likely to occur in areas where the Federal designation provides clearer information on the importance of particular areas as habitat for a listed species. In addition, applicants who were “categorically exempt” from preparing an Environmental Impact Report under CEQA may no longer be exempt once critical habitat is designated. In cases where the designation triggers the CEQA significance test or results in a reduction of categorically exempt activities, associated costs are considered to be an indirect effect of the designation.

 

54.               In these and other cases in which costs are incurred by landowners and managers above and beyond what would be required under State or local law and policy in the absence of the designation, these costs are considered to be an indirect effect of the designation. As such, these economic effects are reported in the analysis.


                     Time Delays and Regulatory Uncertainty

 

55.               In addition to the indirect effects of compliance with other laws triggered by the designation, project proponents, land managers and landowners may face additional indirect impacts. These can include costs due to project delays associated with the consultation process or compliance with other regulations, or, in the case of land location within or adjacent to the designation, loss in property values due to regulatory uncertainty, and loss (or gain) in property values resulting from public perceptions regarding the effects of critical habitat. These categories of potential effects are described in greater detail below.


                    Time Delays

 

56.               Both public and private entities may experience incremental time delays for projects and other activities due to requirements associated with the section 7 consultation process and/or compliance with other laws triggered by the designation. The need to conduct a section 7 consultation will not necessarily delay a project, as often the consultation may be coordinated with the existing baseline regulatory approval process. However, depending on the schedule of the consultation, a project may experience additional delays, resulting in an unanticipated extension in the time needed to fully realize returns from the planned activity. To the extent that delays result from the designation, they are considered in the analysis. Specifically, the analysis considers costs associated with any incremental time delays associated with section 7 consultation or other requirements triggered by the designation above and beyond project delays resulting from baseline regulatory processes.


                     Regulatory Uncertainty

 

57.               The Service conducts each section 7 consultation on a case-by-case basis and issues a Biological Opinion on formal consultations based on species-specific and site-specific information. As a result, government agencies and affiliated private parties who need to consult with the Service under section 7 may face uncertainty concerning whether project modifications will be recommended by the Service and what the nature of these modifications will be. This uncertainty may diminish as consultations are completed and additional information becomes available on the effects of critical habitat on specific activities. However, a degree of regulatory uncertainty may persist. In some cases, this uncertainty may be incorporated by the project proponent into the costs of completing a proposed activity. For example, mining companies uncertain about potential restrictions to their activities in designated areas of critical habitat may lease mining rights at a reduced rate. Additionally, landowners may incur costs determining whether their property constitutes critical habitat. Footnote They may retain outside experts or legal counsel to better understand their responsibilities with regard to critical habitat. Where appropriate, the analysis considers the potential costs associated with regulatory uncertainty.




                     Stigma

 

58.               In some cases, the public may perceive that critical habitat designation may result in incremental changes to private property values, above and beyond those associated with anticipated project modifications and regulatory uncertainty described above. That is, the public may perceive that, all else being equal, a property that is designated as critical habitat will have lower market value than an identical property that is not within the boundaries of critical habitat. Public attitudes about the limits and costs that critical habitat may impose can cause real economic effects to the owners of property, regardless of whether such limits are actually imposed.

 

59.               Conversely, the direction of property value effects resulting from critical habitat may be positive rather than negative. For example, property owners may believe that critical habitat designation will increase property values, if they believe that such designation will slow sprawling development in a given community (i.e., protect the rural character of an area) or increase water quality of neighborhood streams and rivers. This perception alone may result in real increases in land values, even in cases where the economic analysis predicts no additional requirements on activities taking place in the area. In either case, as the public becomes aware of the true regulatory burden imposed by critical habitat, the impact of the designation on property markets should decrease. This analysis considers the implications of public perceptions related to critical habitat on private property values within the proposed designation.


          1.3.5  Benefits

 

60.               The published economics literature has documented that real social welfare benefits can result from the conservation and recovery of endangered and threatened species. Such benefits have also been ascribed to preservation of open space and biodiversity, both of which are associated with species conservation. Likewise, regional economies and communities can benefit from the preservation of healthy populations of endangered and threatened species, and the habitat on which these species depend.

 

61.               In Executive Order 12866, OMB directs Federal agencies to provide an assessment of costs and benefits of a proposed regulatory actions. Footnote However, in its guidance for implementing Executive Order 12866, OMB acknowledges that often, it may not be feasible to monetize, or even quantify, the benefits of environmental regulations. Footnote Where benefits cannot be quantified, OMB directs agencies to describe the benefits of a proposed regulation qualitatively. This report provides insight into the potential economic benefits of critical habitat designation based on information obtained in the course of developing the economic analysis. It is not intended to provide a complete analysis of all of the benefits that could result from the designation. Given these limitations, the Service believes that the benefits of critical habitat designation are best expressed in biological terms that can be weighed against the expected cost impacts of the rulemaking.


          1.3.6  Analytic Time Frame

 

62.               The analysis examines activities taking place both within and adjacent to the proposed designation. It estimates impacts based on activities that are “reasonably foreseeable," including, but not limited to, activities that are currently authorized, permitted, or funded, or for which proposed plans are currently available to the public. Accordingly, the analysis bases estimates on activities that are likely to occur within a ten year time frame, beginning on the day that the current proposed rule becomes available to the public. The ten-year time frame was chosen for the analysis because, as the time horizon for an economic analysis is expanded, the assumptions on which the projected numbers of projects are based become increasingly speculative. As a result, it is difficult to predict not only the numbers of projects, but also the cost estimates for the associated consultations, beyond a ten-year window. Consequently, any attempt to extend the economic analysis beyond the ten-year time window would be speculative.

 

          1.3.7  General Analytic Steps

 

63.               This report relies on a sequential methodology and focuses on distilling the salient and relevant aspects of potential economic impacts of the proposed designation. The steps followed in this analysis consist of:

 

                   Describing current and projected economic activity within and around the proposed critical habitat area;

 

                   Identifying whether such activities are likely to involve a Federal nexus;

 

                   For activities with a Federal nexus, evaluating the likelihood that these activities will require consultations under section 7 of the Act and, in turn, result in any modifications to projects.

 

                   Estimating the direct costs of expected section 7 consultations, project modifications and other economic impacts associated with the designation;

 

                   Estimating the likelihood that current or future activities may require additional compliance with other Federal, State, and local laws as a result of new information provided by the proposed designation;

 

                   Estimating the likelihood that projects will be delayed by the consultation process or other regulatory requirements triggered by the designation;

 

                   Estimating the likelihood that economic activity will be affected by regulatory uncertainty, and/or property values affected;

 

                   Estimating the indirect costs of the designation, as reflected in the cost of compliance with State and local laws, project delays, regulatory uncertainty, and effects on property values;

 

                   Assessing the extent to which critical habitat designation will create costs for small businesses as a result of modifications or delays to projects;

 

                   Assessing the effects of administrative costs and project modifications on the supply, distribution, and use of energy; and

 

                   Determining the benefits that may be associated with the designation of critical habitat.

 

64.               As noted above, this analysis considers both the efficiency effects and distributional effects that could result from this designation. It begins by considering direct compliance costs associated with the designation, as well as potential indirect effects, such as those effects associated with compliance with other Federal, State, and local laws, project delays, and impacts to property values. As necessary, regional economic impacts are described, as are impacts on significantly affected markets. Impacts on small entities and energy production and consumption are discussed separately, in Appendix B of this analysis. Potential benefits of critical habitat are discussed qualitatively in Section 5.



1.4     Information Sources

 

65.               The primary sources of information for this report were communications with personnel from the Service, affected Federal agencies, State agencies and counties. Specifically, communication with personnel from the following entities.

 

                   Departments of Transportation (DOT);

                   United States Army Corps of Engineers (USACE);

                   Natural Resource Conservation Service (NRCS);

                   Farm Services Agency (FSA);

                   Federal Energy Regulatory Commission (FERC);

                   United States Environmental Protection Agency (EPA);

                   The Nature Conservancy;

                   Tennessee Valley Authority (TVA);

                   United States Forest Service (USFS);

                   Alabama Department of Environmental Management (ADEM);

                   Alabama Department of Economic and Community Affairs (ADECA);

                   Alabama Department of Conservation and Natural Resources;

                   Alabama Forestry Commission;

                   Georgia Department of Natural Resources (DNR);

                   Mississippi Department of Fisheries, Wildlife, and Parks (DFWP);

                   and Columbus Air Force Base.


          Publicly available data were also used to augment the analysis. Please refer to the reference section at the end of this document for a full reference list.












SOCIOECONOMIC PROFILE AND BASELINE ELEMENTS      SECTION 2



 

66.               This section provides information on the socioeconomic characteristics of areas proposed as critical habitat for the mussels. In addition, this section provides relevant information about regulations and requirements that exist in the baseline (i.e., the "without section 7" scenario).

 

2.1     Socioeconomic Profile of the Critical Habitat Area

 

67.               This sub-section summarizes key economic and demographic information for the counties containing proposed critical habitat for the mussels, including population characteristics and general economic activity. County level data are presented to provide context for the discussion of potential economic impacts, and to illuminate trends that may influence these impacts. Although county level data may not precisely reflect the socioeconomic characteristics of the areas immediately surrounding the proposed critical habitat for the mussels, as the units comprise rivers and creeks that cross county barriers, these data provide context for the broader analysis.

 

2.1.1Population Characteristics

 

68.               The critical habitat designation spans a diverse array of urban and rural areas within the Mobile River Basin. Exhibit 2-1 lists the population size, per capita income, and population density for all the counties that have critical habitat designated within their boundaries and for the states as a whole. With the exception of Jefferson County, Alabama which represents nearly 15 percent of the state’s population, each county containing critical habitat represents no more than four percent of its respective statewide populations. Of the 31 counties, 27 have a lower per capita income and 20 have fewer persons per square mile than their respective statewide averages. Although these measures vary considerably across states, the data suggest that overall the counties are less densely populated, and have a lower than average income per capita, than respective statewide averages.

                                                     


Exhibit 2-1


SOCIOECONOMIC PROFILE OF COUNTIES CONTAINING

CRITICAL HABITAT FOR THE MUSSELS (2000)

State

County

Population*

Percent of State

Percent change 1990-2000

Per Capita Income

Persons per square mile

Alabama


State Total

4,450,000

100%

10.1%

$23,500

87.6

Bibb

20,800

0.5%

25.5%

$18,000

33.4

Blount

51,000

1.2%

30.0%

$20,100

79

Calhoun

112,000

2.5%

-3.3%

$21,200

184.5

Cherokee

24,000

0.5%

22.7%

$17,300

43.4

Cleburne14,49226.3659,74318,32025.28,383,915

14,100

0.3%

10.9%

$19,100

25.2

Coosa

12,200

0.3%

10.3%

$17,600

18.7

Dallas

46,400

1.0%

-3.7%

$20,000

47.3

Fayette

18,500

0.4%

3.0%

$18,900

29.5

Greene

9,970

0.2%

-1.8%

$16,000

15.4

Jefferson

662,000

14.9%

1.6%

$29,900

595

Lamar

15,900

0.4%

1.2%

$18,800

26.3

Lawrence

34,800

0.8%

10.4%

$19,700

50.2

Macon

24,100

0.5%

-3.3%

$15,700

39.5

Pickens

21,000

0.5%

1.2%

$18,500

23.8

Shelby

143,000

3.2%

44.2%

$32,000

180.3

St. Clair

64,700

1.5%

30.0%

$21,100

102.2

Sumter

14,800

0.3%

-8.5%

$17,200

16.4

Talladega

80,300

1.8%

8.4%

$18,800

108.6

Tuscaloosa

165,000

3.7%

9.6%

$23,700

124.5

Winston

24,800

0.6%

12.7%

$18,600

40.4

Georgia

State Total

8,187,000

100%

26.4%

$27,800

141.4

Floyd

90,600

1.1%

11.5%

$23,900

176.5

Gordon

44,100

0.5%

25.8%

$21,800

124

Haralson

25,700

0.3%

17.0%

$20,600

91.1

Murray

36,500

0.5%

39.6%

$18,000

106

Paulding

81,700

1.0%

96.3%

$17,500

260.6

Whitfield

83,500

1.0%

15.3%

$27,600

288

Mississippi

State Total

2,840,000

100%

10.5%

$20,900

60.6

Itawamba

44,100

1.6%

13.8%

$20,000

42.8

Lowndes

61,600

2.2%

3.8%

$21,300

122.6

Monroe

38,000

1.3%

3.9%

$18,300

49.7

Tennessee

State Total

5,690,000

100%

16.7%

$25,900

138

Bradley

88,900

1.56%

19.3%

$24,000

267.6

Polk

16,200

0.29%

17.6%

$18,700

36.9

Source: U.S. Census Bureau, Census 2000 and State & County QuickFacts, accessed at http://quickfacts.census.gov/qfd on December 10, 2002.

* Census 2000 figures reflect 1999 estimates.


 

 

         2.1.2 Economic Activity

 

69.             The predominant land-use activities occurring within the vicinity of the mussel critical habitat are agriculture, water-related commerce and recreation, and development-related activity. Understanding the extent of the various land-use activities in areas in or around critical habitat underscores the activities most likely to experience section 7 impacts. Exhibit 2-2 highlights the annual payroll for various industries in the 31 counties containing critical habitat. In all four states, manufacturing and services sectors maintain the largest payroll. Footnote





Exhibit 2-2


ECONOMIC ACTIVITY WITHIN COUNTIES CONTAINING MUSSEL CRITICAL HABITAT:

 ANNUAL PAYROLL BY INDUSTRY (2000)


Industry

Annual Payroll (Thousands)

Alabama

Georgia

Mississippi

Tennessee

Agriculture, Forestry, Hunting, and Fishing

$46,600

$4,630

$2,030

$714

Mining

$200,000

n/a

$2,750

$1,380

Utilities

$36,200

n/a

$7,660

n/a

Construction

$1,420,000

$146,000

$97,700

$45,500

Manufacturing

$3,310,000

$1,500,000

$371,000

$413,000

Wholesale Trade

$1,620,000

$250,000

$41,700

$63,800

Retail Trade

$1,510,000

$360,000

$304,000

$90,400

Transportation and Warehousing

$537,000

$116,000

$29,700

$18,900

Information

$867,000

$62,000

$12,100

$12,500

Finance and Insurance

$1,550,000

$91,600

$26,900

$35,600

Real Estate

$229,000

$22,600

$5,690

$6,470

Services

$6,430,000

$832,000

$226,000

$354,000

Auxiliaries

$19,700

$26,700

$1,980

n/a

Unclassified

$2,530

$686

$36

$11

TOTAL

$17,800,000

$3,410,000

$1,130,000

$1,040,000

Source: U.S. Census Bureau, 2000 County Business Patterns, accessed at http://censtats.census.gov/cbpnaic/cbpnaic.shtml on December 11, 2002.

Notes: Payroll estimates are in 2000 dollars. These values reflect the combined value of the counties containing critical habitat within these states, and are not statewide totals. “N/a” represents data not reported in the census County Business Patterns.


 

70.             Exhibit 2-3 provides industry and employment data for all 31 counties that contain portions of the designation. The “Number of Establishments” column displays the total number of physical locations at which business activities are conducted with one or more paid employee in the year 2000. Over 60,000 business establishments operate and employ nearly 900,000 individuals in the 31 counties containing proposed critical habitat for the mussels. These figures provide a measure of the average density of commercial and industrial establishments in the region.

 

71.             Despite the fact that manufacturing and services account for the greatest economic activity, these industries are not as likely to be directly affected by critical habitat for the mussels as those industries dependent upon or limited by water resources. These industries interact more directly with the stream segments proposed for critical habitat and include agriculture, development, hydropower, and recreational fishing.


Exhibit 2-3


ECONOMIC ACTIVITY WITHIN COUNTIES CONTAINING MUSSEL CRITICAL HABITAT:

NUMBER OF ESTABLISHMENTS AND EMPLOYEES BY INDUSTRY (2000)

 

Alabama

Georgia

Mississippi

Tennessee

Employees

Establish-ments

Employees

Establish-ments

Employees

Establish-ments

Employees

Establish-ments

Agriculture, Forestry, Hunting, and Fishing

2,670

299

338

33

196

19

37

9

Mining

6,030

108

485

9

280

12

55

5

Utilities

10,000

168

904

19

235

21

198

6

Construction

46,700

3,500

5,280

825

3,740

280

1,600

165

Manufacturing

102,000

1,780

51,100

751

12,000

166

13,300

146

Wholesale Trade

37,300

2,470

7,780

582

1,380

126

2,430

90

Retail Trade

83,800

6,560

17,600

1,540

6,240

594

4,890

442

Transportation and Warehousing

18,800

992

5,030

212

978

110

722

71

Information

20,600

596

2,030

89

494

43

557

27

Finance and Insurance

39,000

2,150

2,950

396

932

194

1,300

146

Real Estate

9,730

2,330

1,030

209

317

81

299

74

Services

277,000

14,600

42,200

2,400

13,000

1,000

17,500

930

Auxiliaries

2,800

13,200

1,430

18

169

10

99

2

Unclassified

892

352

121

336

22

15

19

18

TOTAL

657,000

49,100

138,000

7,420

40,000

2,670

43,000

2,130

Source: U.S. Census Bureau, 2000 County Business Patterns, accessed at http://censtats.census.gov/cbpnaic/cbpnaic.shtml on December 11, 2002.

Notes: Numbers may not sum due to rounding. Payroll estimates are in 2000 dollars. These values reflect the combined value of the counties containing critical habitat within these states, and are not statewide totals.



                   (a) Agriculture

 

72.             Agriculture, including livestock raising, grazing, aquaculture, and rowcropping accounts for over 25 percent of the land use in the Mobile River Basin. Footnote The primary crops cultivated in the region include corn, soybeans, cotton, wheat, and sorghum. Soybeans and cotton, with over 2.6 and 4.3 million acres harvested respectively in 2001, are the highest acreage crops in the region. Footnote Livestock (including poultry, cattle, and swine), horticulture, (including sod and turf farming), and silviculture also constitute a significant level of agricultural activity in the region.

 

73.             Exhibit 2-4 summarizes the market value of all agricultural products sold within the counties containing proposed critical habitat for the mussels.



Exhibit 2-4


VALUE OF AGRICULTURE IN COUNTIES CONTAINING

MUSSEL CRITICAL HABITAT (1997)

State

County

Market Value

Crops

(share of Market Value)

Livestock

 (share of Market Value)

Alabama

State Total

$3,100,000,000

20%

80%

Bibb

$2,150,000

11%

89%

Blount

$138,000,000

4%

96%

Calhoun

$53,900,000

12%

88%

Cherokee

$49,300,000

48%

52%

Cleburne

$45,900,000

4%

96%

Coosa

$1,320,000

20%

80%

Dallas

$29,800,000

52%

48%

Fayette

$8,150,000

24%

76%

Greene

$11,500,000

13%

87%

Jefferson

$16,100,000

19%

81%

Lamar

$5,390,000

20%

80%

Lawrence

$79,900,000

19%

81%

Macon

$9,580,000

70%

30%

Pickens

$60,600,000

5%

95%

Shelby

$11,200,000

67%

33%

St. Clair

$51,700,000

12%

88%

Sumter

$11,200,000

8%

92%

Talladega

$40,300,000

15%

85%

Tuscaloosa

n/a

30%

70%

Winston

$59,100,000

0%

100%

Georgia

State Total

$5,000,000,000

38%

62%

Floyd

$31,000,000

10%

90%

Gordon

$88,300,000

5%

95%

Haralson

$16,600,000

3%

97%

Murray

$43,700,000

3%

97%

Paulding

$11,200,000

6%

94%

Whitfield

$46,000,000

2%

98%

Mississippi

State Total

$3,130,000,000

41%

59%

Itawamba

$14,500,000

20%

80%

Lowndes

$45,300,000

21%

79%

Monroe

$16,900,000

61%

39%

Tennessee

State Total

$2,180,000,000

53%

47%

Bradley

$54,900,000

5%

95%

Polk

$22,200,000

10%

90%

Source: USDA, National Agriculture Statistics Service, Census of Agriculture, 1997, accessed at http://www.nass.usda.gov/census/ on December 10, 2002.

Notes: Numbers may not sum due to adding. “N/a” indicates data not reported in the 1997 Census of Agriculture.


 

74.             As over 80 percent of the critical habitat designation falls within Alabama, detailed current data on agricultural production within Alabama are provided below. Exhibit 2-5 summarizes the production value of major agricultural commodities in the 20 Alabama counties containing critical habitat. Forestry alone was valued at over $800 million total in all counties for the year 2000. Livestock, aquaculture, and poultry production accounted for the second most productive activity at over $500 million. Further, greenhouse, sod, nursery, and cotton production generated approximately $70 million in revenue in 2000.



Exhibit 2-5


MAJOR AGRICULTURAL COMMODITIES WITHIN

MUSSELS CRITICAL HABITAT IN ALABAMA (2000)

 

Value of Cash Receipts from Farm Marketings (Thousands)

County

Livestock, Aquaculture, & Poultry

Greenhouse, Sod, Nursery

Cotton

Fruit, Pecans, & Vegetables

Soybeans

Forestry

Bibb

$2,830

n/a

n/a

$72

n/a

$16,400

Blount

$123,000

$718

$485

$2,910

$96

$14,600

Calhoun

$22,500

$8,050

n/a

$168

$96

$41,800

Cherokee

$13,200

$15,100

$5,650

$148

$282

$48,500

Cleburne

$32,900

n/a

n/a

$11

n/a

$45,800

Coosa

$2,030

$88

n/a

$58

n/a

$14,600

Dallas

$21,900

n/a

$3,120

$623

$220

$55,800

Fayette

$6,440

$53

$404

$133

$86

$18,700

Greene

$18,000

n/a

n/a

$47

n/a

$36,700

Jefferson

$2,500

$2,950

n/a

$383

n/a

$22,200

Lamar

$5,100

n/a

n/a

$124

n/a

$16,600

Lawrence

$67,000

$153

$12,400

$527

n/a

$104,000

Macon

$3,630

$4,170

$781

$151

n/a

$17,300

Pickens

$66,000

$401

$485

$93

n/a

$93,900

Shelby

$5,030

$4,770

$1,160

$97

n/a

$18,800

St. Clair

$31,200

$3,540

n/a

$1,490

n/a

$49,700

Sumter

$15,900

n/a

n/a

$69

$77

$38,600

Talladega

$20,100

$665

$2,640

$279

n/a

$36,700

Tuscaloosa

$15,500

$2,060

$1,100

$124

$62

$43,100

Winston

$72,100

$33

n/a

$45

n/a

$88,200

Counties Total

$547,000

$42,700

$28,200

$7,550

$919

$822,000

Source: Alabama Agricultural Statistics, accessed at http://www.aces.edu/department/nass/bulletin/2000/pg04.htm on December 11, 2002.

Notes: Numbers may not sum due to rounding. “N/a” indicates data not reported in Alabama Agricultural Statistics.


 

75.             In 2001, the major agricultural commodities produced within the six Georgia counties containing mussel critical habitat included livestock, horticulture, row/forage crops, and forestry. Livestock, aquaculture, poultry, and egg production were valued at over $4.6 billion, constituting nearly seven percent of total statewide livestock production. Horticulture production, including greenhouse, sod, and nursery products, represented over four percent (over $500 million) of total statewide production

 

76.             While county-level data are not readily available for current market and farm gate agricultural values within Mississippi and Tennessee, production figures highlight the major commodities within the five counties containing critical habitat in those states. Rowcropping, livestock raising, and forest-related activities dominate agricultural activity within the relevant counties.

 

77.            Among the four states, Mississippi is the number one producer of soybeans, with over one million acres harvested in 2001. Collectively, Itawamba, Lowndes, and Monroe Counties, Mississippi produced over 36,000 units of livestock (including cattle, swine, chicken, broilers, and eggs), approximately 22.4 million bushels of corn, and 592,000 bushels of soybeans. Within Tennessee, Bradley and Polk Counties produced 40,000 units of livestock, 300,000 bushels of corn, 97,000 bushels of cotton, and harvested over two million acres of forest-related goods. Footnote


                   (b) Development

 

78.             Commercial and residential growth characterizes recent development activity within a number of counties containing proposed critical habitat, particularly within Alabama and Georgia. Population increases in the past decade have driven economic growth tied to growing real estate markets and infrastructure-related activities, including industrial and water development and road and bridge construction.

 

79.             The Birmingham Metropolitan area within Jefferson County, in which the Cahaba River and the Locust Fork Creek flow, is characterized by concentrated commercial and residential activity (Units 12 and 13). While commercial activities are clustered along highways closer to Birmingham, residential communities are expanding in areas away from the city. In 2000, approximately 288,162 housing units existed in the county and constituted nearly 15 percent of Alabama’s total housing units. In 2000, 3,060 additional housing units were authorized by building permits. Construction payroll in Jefferson County amounted to $950,000,000 in 2000, accounting for 8.4 percent of total county annual payroll.

 

80.             Counties within the Georgia portion of the designation have experienced population growth and suburbanization as metropolitan Atlanta expands outwards. Paulding County, which contains the Tallapoosa River within Unit 16, is considered one of metropolitan Atlanta’s hottest growth spots. The county’s population and number of housing units constructed nearly doubled in size during the 1990s. In 2000, construction alone accounted for 21.8 percent of Paulding County earnings. Projections indicate that periods of growth still lie ahead, as the county’s population is anticipated to increase by 69 percent by 2010. Footnote

 

81.             Murray County, which contains portions of the Conasauga River within Unit 25, also experienced rapid development in the past decade, with both population and the number of housing units constructed growing by 40 percent. The county’s population is anticipated to increase an additional 25 percent by 2010. Development pressure also exists within Floyd County within and adjacent to the city of Rome up to the border of Chattooga County.


                   (c) Water-related Economic Activity

 

82.             Rivers and tributaries within the Mobile River Basin supply a variety of municipal, industrial, and rural water uses, and facilitate hydropower generation, sportfishing, and other water-based recreational activity. This section describes and provides economic data on water-related activities based in and around the waters proposed for critical habitat designation for the mussels.


                   Hydropower

 

83.             A network of 36 dams and associated reservoirs and locks regulate the surface-water system in all six river drainages within the greater Mobile River Basin. The majority of surface water withdrawn from the basin is used for hydroelectric power generation. While coal, natural gas, oil, and nuclear sources fuel the majority of the region’s energy needs, the four states within the Mobile River Basin derive a small portion of their overall power supply from hydropower. In 1999, an estimated 80.3 million kilowatthours of hydroelectric energy accounted for 6.4 percent of all electric power generated in Alabama. In Georgia, 27 million kilowatthours of hydroelectric power represented 2.3 percent of total electric power generated that year. Tennessee’s hydropower generation, estimated at 97.2 million kilowatthours, constituted 7.4 percent of all electric utilities. Mississippi relied minimally on hydropower generation, which accounted for less than one percent of total electric energy produced. Footnote

  




                   Recreational Fishing

 

84.             The rivers, creeks, lakes, and reservoirs within the Mobile River Basin support a thriving sportfishing and recreational boating industry. These activities, in turn, contribute significantly to the economic and social well-being of the Mobile River basin community. In 2001, over two million anglers participated in recreational fishing in Alabama, Georgia, Mississippi, and Tennessee. Sportfishing also supports various industries that provide goods and services to anglers. In 2001, sportfishing-related expenses, including trip and equipment costs, generated over $1.9 billion in revenue in all four states. Footnote



2.2    Relevant Baseline Elements

 

85.             “Baseline elements” consist of regulations, guidelines, and/or policies that may afford protection for the mussels in the absence of section 7 implementation. Baseline protections for the mussels include Federal and State laws, including the prohibition against take of the species contained within section 9 of the Act, as well as voluntary environmental programs that provide protection to the mussels in the absence of the protection afforded by the listing and any anticipated additional protection afforded by the proposed critical habitat designation. This discussion focuses on several important regulatory elements that have bearing on this analysis.

 

86.             The following regulations provide environmental protection in the proposed critical habitat areas. Most of these regulations specifically address the maintenance or improvement of water quality. Because the mussels are aquatic species, they benefit from these protections. Although section 7 consultations will take place on activities involving a Federal nexus, measures required to protect the mussels and their habitat are complemented by regulations that serve to protect water quality. Provided these regulations are properly implemented and effective, the presence of mussels’ critical habitat would not be expected to result in incremental project modifications.

 

         2.2.1 Federal Protections

 

87.             This section highlights pertinent information on Federal regulations and policies that may offer protection to the mussels and their habitat absent designation of critical habitat for the species.


                  Recovery Plan Footnote

 

88.             An important component of the regulatory baseline is the Mobile River Basin Aquatic Ecosystem Recovery Plan. The plan establishes a recovery strategy to protect the Basin’s native aquatic fauna and flora through ecosystem management. Implemented recovery actions include host fish identification research, laboratory propagation, limited population augmentation, monitoring, watershed planning, encouraging voluntary stewardship, and protection of occupied habitat. The Recovery Plan does not include objectives to enable the mussels to recover to the point of delisting due to the extent of their decline, population isolation, sensitivity to common pollutants, and continued impacts upon their habitat. While the Recovery Plan does not obligate other parties to undertake specific tasks and provides no regulatory power over landowners or managers, it serves as an important information source and incentive tool for conservation initiatives.

 

Clean Water Act

 

89.             The purpose of the CWA is to restore the physical, biological, and chemical integrity of the waters of the United States using two basic mechanisms: 1) direct regulation of discharges pursuant to permits issued under the National Pollution Discharge Elimination System (NPDES) and Section 404 (discharge of dredge or fill materials); and 2) the Title III water quality program. Footnote

 

90.             Under the NPDES program, EPA sets pollutant-specific limits on the point source discharges for major industries and provides permits to individual point sources that apply to these limits. EPA has delegated responsibility for the NPDES permitting program to most states. Footnote State-issued NPDES permits are treated as non-Federal actions. As such, the issuance of NPDES permits by State agencies are not subject to the consultation requirements of the Act. The Service consults with the EPA on the triennial review to ensure that endangered species impacts are contemplated in the development of standards.

 

91.             Under the water quality standards program (WQS), EPA has issued water quality criteria to establish limits on the ambient concentration of pollutants in surface waters that will still protect the health of the water body. States issue water quality standards that reflect the Federal water quality criteria and submit the standards to EPA for review. State water quality standards are subject to review every three years (triennial review). States apply the standards to NPDES discharge permits to ensure that discharges do not violate the water quality standards. Footnote

 

92.             Under section 401 of the CWA, all applicants for a Federal license or permit to conduct activity that may result in discharge to navigable waters are required to submit a State certification to the licensing or permitting agency. The State certification must ensure that the discharge complies with the requirements of sections 301, 302, 303, 306, and 307 of the CWA. Section 404 of the CWA prescribes a permit program for the discharge of dredged or fill material into navigable waters. Specifically, pursuant to section 404, permit applicants are required to show that they have “taken steps to avoid wetland impacts, where practicable, minimized potential impacts to wetlands, and provided compensation for any remaining, unavoidable impacts through activities to restore or recreate wetlands.” Footnote

 

93.             The CWA will influence activities on or near all 26 of the critical habitat units for the mussels, due to the existence of road/bridge construction, residential development, and hydropower relicensing activities on or near all units. Since water quality is important to the recovery of the mussels, this statute will likely impact the extent, location, and nature of future activities on or near the proposed critical habitat units over the next ten years. As such, the CWA is likely to provide substantial baseline protection to the mussels as limitations to water pollution present more favorable living conditions for the mussels. The development of State water quality standards pursuant to the CWA, however, are subject to consultation under section 7 of the Act.


                   Fish and Wildlife Coordination Act

 

94.             The purpose of this act is to ensure that fish and wildlife resources are equally considered with other resources during the planning of water resources development projects by: 1) authorizing the Secretaries of Agriculture and Commerce to provide assistance to Federal and State agencies in protecting game species and studying the effects of pollution on wildlife; and 2) requiring consultation with the Service for water impoundment or diversion projects with a Federal nexus. Footnote




                   Federal Power Act

 

95.             The Federal Power Act (FPA) was established in 1920. Footnote The purpose of the FPA was to establish a regulatory agency, the Federal Power Commission (FPC), for non-federal hydropower generation and to require non-Federal hydropower owners/operators to obtain a license for the operation of the facility. Over the years, the FPC took responsibility for additional national regulatory issues and evolved into the Federal Energy Regulatory Commission (FERC), an independent Federal agency governing approximately 2,500 licenses for non-Federal hydropower facilities. Footnote In 1986 the FPA was amended to, among other things, require FERC to give equal consideration to fish and wildlife concerns affected by hydropower facilities during the relicensing process.

 

96.             Specifically, section 10(j) of the FPA was promulgated to ensure that FERC considers both power and non-power resources during the licensing process. As such, section 10(j) instructs FERC to actively solicit input regarding “adequate and equitable” fish and wildlife measures from Federal and State resource agencies. Footnote FERC must consider these recommendations during the licensing process but does not have to incorporate the recommendations into the license if they “may be inconsistent with the purposes and requirements of the FPA” or if the recommendations are not supported by substantial evidence.

 

97.             Furthermore, section 18 of the FPA states that FERC shall require the construction, operation and maintenance by a licensee at its own expense of a fishway prescribed by the Secretaries of Interior (delegated to the Service) and Commerce (NOAA Fisheries). Footnote


                   National Wild and Scenic Rivers Act (NWSRA)

 

98.             The NWRSA requires that "In all planning for the use and development of water and related land resources, consideration shall be given by all Federal agencies involved to potential national wild, scenic and recreational river areas." It also requires that "the Secretary of the Interior shall make specific studies and investigations to determine which additional wild, scenic and recreational river areas.....shall be evaluated in planning reports by all Federal agencies as potential alternative uses of water and related land resources involved." Footnote In partial fulfillment of this requirement, the National Parks Service (NPS) maintains a Nationwide Rivers Inventory (NRI), a register of river segments that potentially qualify as national wild, scenic or recreational river areas. Footnote A presidential directive requires Federal agencies to avoid or mitigate adverse effects on rivers identified in the NRI. In additional, agencies are required to consult with the NPS on actions which could affect the wild, scenic or recreational status of a river on the inventory.

 

99.             The NWRSA will provide baseline protection to one of the 26 critical habitat units for the mussels, the Sipsey Fork drainage in proposed Unit 10. Since Federal agencies are required to avoid or mitigate adverse effects on National Wild and Scenic Rivers and those on the NRI, this statute will likely affect the extent, location, and nature of future activities on or near these proposed critical habitat units over the next ten years. As such, the NWRSA is likely to provide baseline protection to the mussels.


                   Soil and Water Resources Conservation Act of 1977

 

100.           This Soil and Water Resources Conservation Act provides for a continuing appraisal of the Nation’s soil, water and related resources, including fish and wildlife habitats, and a soil and water conservation program to assist landowners and land users in furthering soil and water conservation. Specifically, this Act authorizes the Secretary of Agriculture to establish a cooperative conservation program with Federal, State, and local stakeholders for the management of private grazing land to conserve and enhance private grazing land resources. Footnote


                   Watershed Protection and Flood Prevention Act

 

101.           This Act authorizes Federal assistance to local organizations for conservation projects in watershed areas. Specifically, the Secretary of Agriculture is authorized to enter into agreements with local organizations and landowners to provide financial and other assistance in the development of plans to conserve and develop the land's soil, water, woodland, wildlife, energy and recreation resources, and enhance water quality. Footnote


                   Private Stewardship Grants Program Comment

 

102.           The Private Stewardship Program provides grants and other assistance on a competitive basis to individuals and groups engaged in local, private, and voluntary conservation efforts that benefit federally listed, proposed, or candidate species, or other at-risk species. Footnote Diverse panels of representatives from State and Federal government, conservation organizations, agriculture and development interests, and the science community will assess applications and make recommendations to the Secretary of the Interior, who will award the grants. Typical projects may include managing nonnative, competing species; implementing measures to minimize risk from disease; restoring streams that support imperiled species; or planting native vegetation to restore a rare plant community.

 

         2.2.2 State Statutes and Regulations and Other Voluntary Protection Measures

 

103.           Additional State and other baseline regulatory elements potentially relevant to this analysis are described in Appendix A. As the Appendix shows, a considerable number of State and other regulatory initiatives may provide the mussels with some measure of protection absent section 7 consultation.

 

         2.2.3 Overlap with Other Listed Species

 

104.           Several other Federally listed endangered species may be found within the proposed critical habitat area for the mussels. Further, critical habitat exists for two fish species within the Conasauga River portion of the proposed critical habitat for the mussels. Generally, if a consultation is triggered for any listed species, the consultation process will also take into account all other listed species known or thought to occupy areas on or near the project lands. As such, listing or critical habitat-related protections for other threatened or endangered species may benefit the mussels as well (i.e., provide baseline protection). However, due to the difficulty in apportioning the costs of consultations between various species as well as awareness that a consultation for the mussels would need to be conducted absent consultations for or involving other species, this analysis does not attempt to apportion the consultations and related costs reported by Action agencies between the mussels and other listed species, and assumes that all future section 7 consultations within the extant boundaries of the proposed critical habitat are fully attributable to the presence of the mussels and their habitat. While this may lead to an overestimate of costs, it is likely that adding consideration of mussel critical habitat to a consultation regarding other species or habitats will add an incremental cost to that consultation. The Service has conducted consultations on the mussels in combination with numerous species, as indicated in Exhibit 2-6.


Exhibit 2-6


THREATENED OR ENDANGERED SPECIES THAT MAY BE PRESENT IN MOBILE RIVER BASIN MUSSELS CRITICAL HABITAT AREA

Area of Potential Overlap

Category

Common Name

Scientific Name

Status

Mobile River system, in AL and GA

Fish

Alabama sturgeon

Scaphirhynchus suttkusi

Endangered

Conasauga River, Etowah River, Shoal Creek

Fish

Amber darter

Percina antesella

Endangered

Cahaba River, Coosa River and tributaries

Fish

Blue shiner

Cyprinella caerulea

Threatened

Cahaba River in Bibb and Shelby Counties, AL

Fish

Cahaba shiner

Notropis cahabae

Endangered

Upper Conasauga River, TN and GA

Fish

Conasauga logperch

Percina jenkinsi

Endangered

Cahaba and Coosa River Drainage; including Little Cahaba and Coosawatte

Fish

Goldline darter

Percina aurolineata

Threatened

Tombigbee, Black Warrior, and Coosa Rivers, AL

Mussel

Inflated heelsplitter

Potamilus inflatus

Threatened

Tombigbee River

Mussel

Black clubshell

Pleurobema curtum

Endangered

Tombigbee River

Mussel

Flat pigtoe

Pleurobema marshalli

Endangered

Tombigbee River, AL and Cahaba and Coosa Rivers, AL and MS

Mussel

Heavy pigtoe

Pleurobema taitianum

Endangered

Alabama, Cahaba, and Coosa Rivers, AL, Tombigbee River Basin, MS and AL, Black Warrior River, AL

Mussel

Southern combshell

Epioblasma penita

Endangered

Tombigbee River, AL and Black Warrior River, AL and MS

Mussel

Stirrupshell

Quadrula stapes

Endangered

Black Warrior, Cahaba, Alabama, and Coosa Rivers, AL

Snail

Cylindrical lioplax

Lioplaz cyclostomaformis

Endangered

Black Warrior, Cahaba, Alabama, Coosa Rivers, AL

Snail

Flat pebblesnail

Lepyrium showalteri

Endangered

Black Warrior, Cahaba, Alabama, Coosa Rivers, AL

Snail

Lacy elimia

Elimia crenatella

Threatened

Black Warrior, Cahaba, Alabama, Coosa Rivers, AL

Snail

Painted rockshell

Leptoxis taeniata

Threatened

Black Warrior, Cahaba, Alabama, Coosa Rivers, AL

Snail

Plicate rocksnail

Leptoxis plicata

Endangered

Black Warrior, Cahaba, Alabama, Coosa Rivers, AL

Snail

Round rocksnail

Leptoxis ampla

Threatened

Coosa River Basin, AL

Snail

Tulotoma snail

Tulotoma magnifica

Endangered

Locust Fork, Sipsey Fork of Black Warrior River, AL

Turtle

Flattened musk turtle

Sternotherus edpressus

Threatened

Sipsey Fork of Black Warior River, AL

Plants

Kral’s water-plantain

Sagittaria secundifolia

Threatened

Source: US Fish and Wildlife Service and US Geological Survey, Environmental Setting and Water-Quality Issues of the Mobile River Basin, Alabama, Georgia, Mississippi, and Tennessee, 2002.













SECTION 7 ACTIVITIES WITHIN THE MUSSEL

CRITICAL HABITAT DESIGNATION                                                SECTION 3



 

105.           The previous two sections introduced the geographic areas in which the Service is proposing to designate critical habitat for the mussels, the socioeconomic profile of these areas, and general trends associated with population, economic, and urban growth. These sections also outlined the baseline level of protection afforded the mussels and their habitat. This section identifies the current land and water uses in or near proposed critical habitat that may be affected by section 7 implementation for the mussels. Importantly, these estimates include the effects of section 7 implementation for all activities associated with the proposed critical habitat area. As such, this section does not distinguish impacts that may be attributable co-extensively to the listing of the mussels from those impacts attributable solely to the critical habitat designation.

 

106.           This section begins with a summary of the categories of economic impact associated with section 7 implementation for the mussels. It then provides a general description of the activities and potential Federal nexus affecting the area proposed as critical habitat for the mussels.



3.1    Categories of Economic Impacts Associated with Section 7 Implementation

 

107.           The following discussion provides an overview of the categories of economic impacts that are likely to arise due to the implementation of section 7 in the area proposed as critical habitat.


         3.1.1 Technical Assistance

 

108.           The Service may respond to requests for technical assistance from Federal or State agencies, local municipalities, and private landowners and developers with questions regarding whether specific activities may affect a listed species or its critical habitat. Technical assistance costs represent the estimated costs of informational conversations between stakeholders and the Service regarding such potential effects. These technical assistance activities are characteristically low effort voluntary actions between two parties, the Service and the stakeholder. The stakeholder may or may not be a Federal agency, as opposed to section 7 consultation which by definition involves a Federal nexus with or without private third party involvement.

 

109.            In some instances, technical assistance may involve a request for general review of a project or activity that is not subject to section 7 requirements (e.g., activity on private land without a Federal nexus) as a safeguard to ensure adequate protection for species and habitats of concern. For example, although development of water quality standards within a state requires a section 7 consultation, a State agency may request technical assistance from the Service as an additional precaution to ensure that individual NPDES permits conforming to these standards adequately provide for relevant species and habitat. Although technical assistance is not a direct cost of section 7 of the Act, these costs are incorporated into the cost analysis when they are explicitly propagated by consideration of species and habitat conservation.


         3.1.2 Section 7 Consultations

 

110.           Under the listing of a species, section 7(a)(2) of the Act requires Federal agencies to consult with the Service in order to ensure that activities they fund, authorize, permit, or carry out are not likely to jeopardize the continued existence of the species. The Service defines jeopardy as any action that would appreciably reduce the likelihood of both the survival and recovery of the species. For designated critical habitat, section 7(a)(2) also requires Federal agencies to consult with the Service to ensure that activities they fund, authorize, permit, or carry out do not result in destruction or adverse modification of critical habitat. Adverse modification of critical habitat is currently construed as any direct or indirect alteration that appreciably diminishes the value of critical habitat for conservation of a listed species.

 

111.           In some cases, consultations will involve the Service and another Federal agency only, such as the U.S. Army Corps of Engineers (USACE) or the Environmental Protection Agency (EPA). In addition, they may also include a third party, such as State agencies or private landowners involved in projects on non-Federal lands with a Federal nexus.

 

112.           During a consultation, the Service, the Action agency, and the landowner applying for Federal funding or permitting (if applicable) communicate in an effort to minimize potential adverse effects to the species and/or to the proposed critical habitat. Communication between these parties may occur via written letters, phone calls, in-person meetings, or any combination of these. The duration and complexity of these interactions depends on a number of variables, including the type of consultation, the species, the activity of concern, the region where critical habitat has been proposed, and the involved parties.

 

113.           Section 7 consultations with the Service may be either informal or formal. Informal consultation, which consists of discussions between the Service, the Action agency, and the applicant concerning an action that may affect a listed species or its designated critical habitat, is designed to identify and resolve potential concerns at an early stage in the planning process. By contrast, a formal consultation is required if the Action agency determines that its proposed action may or will adversely affect the listed species or designated critical habitat in ways that cannot be resolved through informal consultation. The formal consultation process results in the Service’s determination in its Biological Opinion of whether the action is likely to jeopardize a species or adversely modify critical habitat, and recommendations to minimize those impacts. Regardless of the type of consultation or proposed project, section 7 consultations can require substantial administrative effort on the part of all participants.


         3.1.3 Project Modifications

 

114.           The section 7 consultation process may involve some modifications to a proposed project. Projects may be modified in response to voluntary conservation measures suggested by the Service during the informal consultation process in order to avoid or minimize impact to a species and/or its habitat, thereby removing the need for formal consultation. Alternatively, formal consultations may involve modifications that are agreed upon by the Action agency and the third party and included in the project description as avoidance and minimization measures, or included in the Service’s biological opinion on the proposed action as reasonable and prudent measures (RPMs) and/or discretionary conservation recommendations to assist the Action agency in meeting its obligations under section 7(a)(1) of the Act. Footnote

 

115.           In some cases, the Service may determine that the project is likely to jeopardize the continued existence of the species and/or destroy or adversely modify its designated critical habitat. In these cases the Service will provide the Action agency with reasonable and prudent alternatives (RPAs) that will keep the action below the thresholds of jeopardy and/or adverse modification. An RPA is an alternative that: (1) can be implemented in a manner consistent with the intended purpose of the action; (2) can be implemented consistent with the scope of the Action agency’s legal authority and jurisdiction; and (3) is economically and technologically feasible. These RPAs are typically developed by the Service in cooperation with the Action agency and, when applicable, the third party. Alternatively, the Action agency can develop its own RPAs, or seek an exemption for the project. All of these project modifications have the potential to represent some cost to the Action agency and/or the third party. In certain instances, these modifications can lead to broader regional economic impacts.

 

116.           Because of the difficulty generating estimates of potential modifications to specific projects on a case-by-case basis, this analysis models modifications for average or "typical" projects likely to affect the proposed critical habitat of the mussels. Actual modification costs are likely to vary according to the specific characteristics of individual projects and consultation outcomes. Estimated costs of project modifications are detailed following the descriptions of the related activities in Section 4 of this analysis.




 

         3.1.4 Regional Economic Impacts

 

117.           The consultation process and related project modifications may potentially affect the operations of entities in certain industries (e.g., agriculture producers or residential developers), with secondary impacts on the suppliers of goods and services to these industries, as well as purchasers of production from these industries. For example, modified or decreased grazing and crop harvesting activities may affect businesses providing agricultural equipment and supplies. Thus, project modifications or other restrictions that engender cost and revenue impacts involving commercial enterprises may subsequently effect other sectors of the local economy, particularly where the affected industry is central to the local economy. Industries within a geographic area are interdependent in that they purchase output from other industries and sectors while supplying inputs to other businesses. Direct economic effects on a particular enterprise can therefore affect regional output and employment in multiple industries.

 

118.           Many methods are available for conducting economic impact assessments, depending on the particular policy interests and goals of the economic analysis. Use of an input-output (I-O) model, such as IMPLAN, to gauge the direction and magnitude of regional economic impacts is useful in situations where the critical habitat designation may affect the commercial economy of a specific geographic area. However, I-O modeling is not appropriate for all economic impact analyses associated with critical habitat areas and can result in misinterpretations and biased conclusions if used inappropriately. I-O models are appropriate when the following factors are present: (1) economic impacts of the proposed designation are substantial and clearly defined in the analysis; (2) impacts have a clear effect on one industry or groups of industries prevalent in the geographic region; and (3) substitution possibilities for the focal economic input or activity are not widely available.



3.2    Activities Potentially Affected by Critical Habitat Designation for the Mussels

 

119.           Numerous Action agencies permit and conduct activities and projects in or adjacent to proposed critical habitat areas. These activities may lead to section 7 consultations with the Service, and in some cases specific projects may require modification in order to protect the mussels and/or their habitat. This section provides a list of activities likely to engender section 7 consultation.

 

                 Road/bridge construction and maintenance;

 

                 Hydropower facilities;

 

                 Water supply dams;

 

                 Utilities construction/maintenance;

 

                 Activities in National Forests;

 

                 Agriculture and ranching-related activities;

 

                 Water quality activities;

 

                 Conservation and recreation; and

 

                 Dredging.

 

120.           The following list identifies land use activities that occur within the proposed critical habitat designation but are unlikely to incur section 7 impacts.

 

                 Silviculture;

 

                 Coal Mining; and

 

                 Residential and Related Development.

 

121.           The following discussion explores each of these land activities. For activities likely to be affected by section 7 activity, the potential impact on critical habitat and the Federal nexus (i.e., Action agency) involved are described. For activities unlikely to be affected by section 7, justification for the determination of the lack of impact is provided. Specific information on section 7 consultations, project modifications, and related costs anticipated with respect to each activity is detailed in Section 4 of this analysis.

 

122.           The USACE is the primary Action agency conducting activity in the mussel critical habitat area. This agency is responsible for carrying out and permitting a majority of the activities with the potential to affect riverine, estuarine, and marine areas. USACE civil works divisions undertake projects to maintain navigation channels and water infrastructure, conduct environmental restoration, and maintain flood control. USACE regulatory divisions grant permits for private activities in navigable waterways under section 404 of the Clean Water Act and section 10 of the Rivers and Harbors Act. Details of these proposed USACE activities, including the number of anticipated consultations associated with each activity per state are described by activity in Section 4 of this analysis.

 

         3.2.1 Road/Bridge Construction and Maintenance

 

123.           Road and bridge construction activities may pose a risk to the mussels and their habitat as a result of: increased sedimentation from erosion; construction of instream pilings; alteration of channel morphology; elimination of streambank vegetation to filter runoff; and resulting loss of suitable habitat. Thus, major road and bridge construction, maintenance, and improvement projects in areas proposed as critical habitat for the mussels are likely to require section 7 consultations where a Federal nexus exists. The lead Action agency for road and bridge construction projects may be the USACE, as it has jurisdiction over construction in navigable waterways. The Federal nexus for many DOT activities is the Federal Highway Administration (FHWA) due to its funding of the State DOT projects, though it is the DOT that typically communicates with the Service throughout the consultation process as the designated representative of the FHWA. For non-FHWA funded road projects, the USACE constitutes a Federal nexus if a CWA 404 permit/authorization is required.

 

         3.2.2 Hydropower facilities

 

124.           Four hydropower dams exist within the proposed critical habitat designation for the mussels species. The Alabama Power Company (APC) owns and operates two hydropower facilities within the proposed critical habitat designation for the mussels, Jordan Dam in Unit 26 and Weiss Dam in Unit 18. Under the Federal Power Act, FERC issues licenses for privately owned hydropower facilities. The Federal permitting of each relicensing therefore requires a section 7 consultation to ensure these actions adequately consider listed species and habitat.

 

125.            FERC hydropower licenses are valid for 30, 40, or 50 years, depending on the extent of proposed new development or environmental mitigation and enhancement measures. The licenses under which Jordan Dam and Weiss Dam operate expire in 2007, and applications for relicensing of both hydroelectric dams must be filed by July 31, 2005. Footnote Jordan Dam’s hydropower facility has a capacity of 100 megawatts while Weiss Dam’s generating capacity is 87.75 megawatts. Footnote Collectively, the developments represent about 12 percent of APC’s hydroelectric generation capacity. Footnote In September 2000, APC requested approval for use of FERC’s alternative licensing process (ALP) for both hydroelectric development relicensings. This request was approved in January 2001. Footnote The ALP is intended to facilitate greater collaboration with FERC, the public, and other stakeholders and resource agencies including the Service.

 

126.           The Service's primary concern regarding the relicensing of the dams with respect to the mussels is implementation and maintenance of minimum flows. Upstream of the dams, the increased depth of water, buildup of sediment, decreased levels of dissolved oxygen, and alteration of host fish populations threaten the survival of the mussels. Downstream of the dams, decreased flow, reduced water temperatures, changes in fish assemblage, and isolation of species, further affect the state of the mussels habitat. Footnote Water quality impacts and impingement and entrainment of fish hosts as a result of damming activities may also affect the mussel species. Footnote

 

127.           A third hydropower facility is located at Carters Reregulation Dam, on the Coosawattee River in Murray County, Georgia. In 2001, Fall Line Hydro Company was licensed by FERC to construct a powerhouse facility at the existing dam with a total installed generating capacity of 4.5 MW. Dam flow and releases at this site are under jurisdiction of the Mobile District USACE. Proposed changes to dam operations, for example with regard to minimum flows and water quality issues, may result in future section 7 consultations with the Service.

 

128.           The fourth hydropower dam, the Robert F. Henry lock and dam located in Autauga County in proposed critical habitat Unit 14, is overseen by USACE. The Mobile District’s Black Warrior and Tombigbee/Alabama-Coosa Rivers Project Management Office maintains and operates the dam while the Southeastern Power Administration, an agency within the Department of Energy, markets hydropower generated from the affiliated R. E. “Bob” Woodruff Lake. The Bob Woodruff Lake has a hydro generating capacity of 68 megawatts and produces electricity to serve approximately 45,000 homes. Footnote As both the dam and hydropower generating facilities are federally operated, the R. F. Henry Dam is not subject to FERC jurisdiction and relicensing, although it is subject to the requirements of section 7. Footnote

         3.2.3 Water supply dams

 

129.           Construction of water supply dams in or adjacent to critical habitat for the mussels is a direct threat to the species. None of the 11 mussels are known to survive in impounded waters. Construction of impoundments has historically resulted in fragmentation of species habitat, and induces the accretion of sediment behind the dam that may result in direct habitat alteration and potential suffocation of the species. Fish species that serve as hosts for the glochidia may also be affected by the introduction of dams into habitat. Footnote Pumping of water from designated streams to fill water supply reservoirs may also negatively affect the species by decreasing duration, magnitude, and timing of high and low flows. Footnote Parties such as county governments intending to develop on channel water supply dams must apply for an individual 404 permit from the USACE pursuant to the Clean Water Act.

 

         3.2.4 Utilities Construction/Maintenance

 

130.           Construction or maintenance of in-stream pipelines may result in direct disturbance of the sediment habitat for the species or increased siltation from upstream construction. FERC regulates the rates and transport of natural gas, oil, and electricity under the Department of Energy Organization Act. Footnote Such activity may also require a 404 Clean Water Act permit from the USACE. As such, either FERC or USACE may be the lead Action agency throughout the section 7 consultation with the Service. Further, the Tennessee Valley Authority (TVA) owns and operates transmission systems within the northern Georgia and southern Tennessee portions of the proposed critical habitat and may also consult with the Service. Footnote

 

         3.2.5 Activities in National Forests

 

131.           The U.S. Forest Service (USFS) engages in consultation with the Service regarding activities that occur adjacent to or within the drainages of rivers and creeks that provide habitat for the mussels. Five National Forests are located within the proposed critical habitat designation for the mussels: Tuskeegee, Talladega, and Bankhead National Forests in Alabama, and Chattahoochee-Oconee National Forest in Georgia and Cherokee National Forest in Tennessee. These forests are managed for multiple uses including recreation, wildlife habitat, and timber harvest. Future activities that on which the USFS may initiate section 7 consultation regarding the mussels and habitat include recreation facility construction, trail building, and timber harvest.

 

         3.2.6 Agriculture and Ranching-Related Activities

 

132.           Much of the lands adjacent to the critical habitat area for the mussels are privately-owned and devoted to agriculture, principally rowcropping of cotton and soybeans. Such activities on private land generally do not involve a Federal nexus. In some instances however, agricultural activities on private lands may be supported by voluntary landowner participation in any of a number of programs sponsored by Federal agencies including the NRCS, and the FSA. Additionally, certain agricultural activities are regulated and/or permitted by Federal agencies, such as USACE permitting of water diversion activities. These agencies provide funding or technical assistance for agriculture-related initiatives.

 

133.           The FSA provides technical and financial assistance to farmers under the Farm Bill. Initiatives typically involve agricultural operation improvements to assist in conserving land and water resources, providing credit to new or disadvantaged farmers and ranchers, helping farmers and ranchers recover from disasters, or stabilizing farm income. The NRCS provides cost-share and other Federal assistance to private ranchers and farmers for the establishment of environmentally sustainable land use practices. Typical conservation activities in the proposed critical habitat area include streambank stabilizations and fencing of livestock. The NRCS may provide funding through voluntary partnership with private landowners under conservation programs such as the Environmental Quality Incentives Program (EQIP) which provides technical and financial assistance for the installation or implementation of structural and management conservation practices on agricultural land to farmers and ranchers who face particular land and water quality threats.

 

         3.2.7 Water Quality Activities

 

134.           The Environmental Protection Agency (EPA) may engage in section 7 consultations with the Service regarding water quality standards to ensure that they are appropriately protective of endangered and threatened species. EPA typically considers listed species when consulting with the Service on the following categories of water quality program activities:

 

                 Total maximum daily load (TMDL) approvals. Assignment of TMDL levels falls under section 303 (d) of the Clean Water Act. Consultations on TMDLs arise when the combination of point and non-point source pollutants causes a noncompliance in a body of water, which is then listed in the state's section 303d list of impaired waters. Footnote The EPA consults with the Service regarding TMDLs on 303 (d) streams that are listed due to aquatic life criteria impairments. Impairments that effect the mussel habitat streams include: nutrients, sediments, low dissolved oxygen, and pesticides. Footnote Six 303 (d) listed streams occur in the mussels proposed critical habitat area that are listed for such impairments.

 

                 State 303 (d) lists. State agencies must provide EPA with a proposed list of 303 (d) river segments for approval. Historically, the EPA has consulted with the Service every other year regarding review of these lists. In July of 1991, however, the EPA engaged in a programmatic consultation to streamline review of 303 (d) lists for all Region 4 States, including Alabama, Georgia, Mississippi, and Tennessee. The new process contemplates potential impact to endangered species and habitat and therefore avoids consulting as frequently as in the past regarding 303 (d) list review.

 

                 State Water Quality Standards. The EPA reviews water quality standards within each state approximately every three years.

 

                 Special Appropriation Projects (SPAPs). The EPA funds water improvement projects such as increasing capacity of drinking water facilities, or construction or improvement of wastewater facilities . Footnote

 

135.           EPA’s National Pollutant Discharge Elimination System (NPDES) permit program regulates point source pollution. Although development and implementation of State water quality standards are subject to a section 7 consultation between the Service and the EPA, as an added precaution, the Service may review each individual NPDES permit application to confirm that listed species are not adversely affected by water quality impacts. If the proposed permit does not appear to meet State water quality standards, the Service may object to issuance of the permit, and the State may ask the applicant to alter the permit to meet the standards. According to a 2001 Memorandum of Agreement between the EPA, National Marine Fisheries Service (NMFS), and the Service, the EPA has provided States and tribes authority over their Clean Water Act permitting when appropriate. Footnote Accordingly, NPDES permitting may generate a technical assistance effort between the Service and the designated representative of the EPA (i.e., the respective State agencies) for review of the permit to ensure it appropriately considers the mussels and their habitat.

 

         3.2.8 Conservation and Recreation

 

136.           PFW is a voluntary partnership program between the Service and landowners interested in restoring streamlands, wetlands and other important fish and wildlife habitats on their own lands. The program provides various types of support ranging from technical assistance to private landowners through voluntary cooperative agreements, to funding restoration projects on private lands. Voluntary habitat restoration on private lands usually involves dollar-for-dollar cost share through working with private landowners and Federal, State, and local entities. Landowners sign agreements to keep the restoration projects for the life of the agreement and otherwise retain full control of their land. Footnote As the projects are funded and/or carried out by the Service, internal consultation may take place for each project.

 

137.           The USACE may engage in habitat restoration projects as well. Section 206 of the Water Resources Development Act of 1996 provides authority for the USACE to undertake restoration projects in aquatic ecosystems such as rivers, lakes and wetlands. These projects are intended to benefit the environment through restoring, improving, or protecting aquatic habitat for plants, fish and wildlife. Footnote Further, Section 1135 of the Water Resources Development Act provides authority for the USACE to to plan, design and construct fish and wildlife habitat restoration measures through modification of USACE structures or operations, or modification of an off-project site when it is found that a USACE project has contributed to habitat degradation. Footnote The USACE must consult with the Service when these projects directly impact mussel habitat. The consultations, however are anticipated to be informal in nature as the projects are intended to benefit the species and habitat.

 

138.           The Mississippi Department of Wildlife, Fisheries, and Parks oversees an active fish stocking program within the State. Under the Sport Fishing Restoration Act, the Service assists with funding for this program. Footnote The game fish raised for stocking, including the Alabama walleye and the Florida Bass, are grown in federally-funded hatcheries. Due to Service funding, the fish stocking program in Mississippi is subject to statewide internal section 7 consultation to ensure that the stocking of the fish does not jeopardize present endangered species such as the mussels, or adversely modify their habitat.

 

         3.2.9 Dredging

 

139.           Gravel dredging and excavating activities require a section 404 CWA permit from the USACE when there will be a discharge of dredge materials. Gravel dredging and excavation also requires State permitting and State water quality/401 certification before the activities can proceed. Further, the Alabama River and Conasauga River, are designated as section 10 waters under the Rivers and Harbors Act and consequently require a section 10 permit from the USACE for dredging. Footnote



 


         3.2.10         Silviculture

 

140.           Alabama’s Best Management Practices (BMPs) for Forestry and the Master Logger Program provide guidelines and education on timber harvesting near streams. The BMPs are intended to maintain and protect water quality. Examples of protections afforded the mussels include the establishment of streamside management zones, implementation of erosion control measures, and prohibitions of skid trails, logging roads, and logging landings in streams and streamside management zones. These guidelines are not mandated by law, with the exception of restrictions on road and stream crossing construction and maintenance within wetlands and other waters of the United States, as outlined in the USACE baseline BMPs. These guidelines are mandatory in order to retain exemption status from 404 permits. Footnote

 

141.           As stated in Alabama’s BMPs for Forestry, silviculture operations are exempt from Section 404 Corps of Engineers permit requirements when the activities meet certain conditions. Footnote The Alabama Forestry Commission reported that the majority of timber harvesters and landowners follow BMPs. Thus, they meet the above specified conditions, and are exempt from 404 permit requirements. Further, according to the Forest Statistics for Alabama, 2000, over seventy-five percent of the timberland in Alabama is non-industrial private land. Because no federal nexus exists and implementation of BMPs minimizes impacts on the mussels and habitat, consultations associated with silviculture are not foreseeable. Footnote

 

142.            Similarly, Mississippi Forestry BMPs and the logger certification program provide guidelines and education on timber harvesting near streams. The main focus of the MS Forestry BMPs is to protect water quality. Examples of baseline protections afforded the mussels include the establishment of streamside management zones, implementation of erosion control measures, and restrictions on stream crossings, skid trails, logger loading decks, and road and recreational trail construction. Footnote Although BMPs are not mandated by law, a recent survey reported a ninety percent participation rate in BMPs statewide. Footnote

 

143.           Although silviculture occurs within portions of the proposed critical habitat for the mussels, the Mississippi Forestry Commission contends that silviculture will not result in section 7 activities as the majority of the silviculture practiced in the areas surrounding the proposed critical habitat designation is on private non-industrial land, and does not constitute a federal nexus. Footnote

 

         3.2.11         Coal Mining

 

144.           Coal mining, while not a prevalent activity within the proposed critical habitat for the mussels, may occasionally occur in areas adjacent to the critical habitat units. All coal mines require a surface coal mining permit issued under authority of the Federal Surface Mining Control and Reclamation Act (SMCRA). Under SMCRA, states with Office of Surface Mining (OSM) approved programs act as “Primacy States”, or designated Federal representatives, for regulating surface coal mining. Footnote This analysis does not anticipate any section 7 activity regarding the mussels or their habitat with respect to coal mining for the following reasons.

 

145.           The OSM has granted the States of Alabama and Mississippi the regulatory authority (“primacy”) to issue surface coal mining permits. Because these states maintain regulatory authority, there is no Federal nexus and no section 7 consultations are anticipated regarding coal mining activities within these states. Footnote The State of Tennessee does not have primacy, and OSM issues all surface mining permits in this State. The OSM issued permit is the nexus for a section 7 consultation with the Service. Footnote The proposed critical habitat designation within the State of Tennessee, however, is comprised of only 17 miles (27 km) of stream that largely flows through National Forest and no coal mining consultations are anticipated. In 1983 the State of Georgia relinquished primacy to OSM to regulate its coal mining industry. Although coal mining did exist in the northeastern portion of the State in the late 1970's and early 1980's, there is currently no active coal mining within the State. As such, no consultations are expected regarding coal mining in Georgia. Footnote



 


         3.2.12         Residential and Related Development

 

146.           Development activities with the greatest potential to affect the mussels and habitat revolve around the increased construction of pipelines, water supply and wastewater infrastructure, and roads and bridges within the proposed critical habitat. Increased costs of these activities due to the presence of species and habitat is captured through the anticipated consultations and project modifications as quantified within this analysis.

 

147.           Reductions in property value may occur through public perception that the designation will restrict land uses, inhibit private development, or cause project delays. Such loss in property value can be experienced for as long as such perception persists. Thus, any potential reduction in property value would primarily be due to the regulatory uncertainty, engendered by critical habitat designation, concerning land use within critical habitat areas. No additional, significant, development-related effects are anticipated, however, for the following reasons:

 

        While uncertainties about the impacts of the proposed critical habitat designation and the perception that the designation will impose land use restrictions can cause reduction in property value, this effect is likely to be temporary in nature as the uncertainties and perceptions dissipate and/or become clarified over time;

 

        Consultation under section 7 only applies to activities that are carried out, permitted, or funded by a Federal agency. As such, the designation of critical habitat will not afford any additional protections for species with respect to strictly private activities; and

 

        Some or all of the units may additionally experience increases in property value due to the same perceptions of restricted development activities as preservation of open space often has a positive effect on property value.

 

148.           Under section 10(a)(1)(B) of the Act, a non-Federal entity (i.e., a landowner or local government) may develop a Habitat Conservation Plan (HCP) in order to meet the conditions for issuance of an incidental take permit from the Service in connection with the development and management of a property. Footnote Development of such a plan within critical habitat would require an internal section 7 consultation in the Service. It is rare, however, to develop a HCP for aquatic species. Footnote No HCPs have been developed regarding these 11 species in the past and the Service does not anticipate that any will be developed in the future. Footnote


 

3.3              Summary of Results

 

149.           Exhibit 3-1 summarizes the potential level of consultation and technical assistance activity affected by the proposed critical habitat designation for the mussels with respect to each activity in each proposed critical habitat unit. These estimates reflect the total consultation and technical assistance profiles associated with the proposed designation, regardless of whether these consultations or assistance efforts can be attributed co-extensively to the listing of these species. As a result, these estimates reflect an upper-bound measure of impact likely to be associated with this designation.

The costs for these consults and the project modifications they engender are discussed in Section 4.





Exhibit 3-1


CONSULTATION AND TECHNICAL ASSISTANCE EFFORTS ANTICIPATED

WITHIN THE PROPOSED CRITICAL HABITAT FOR THE MUSSELS (TEN YEARS)

Unit

Anticipated Activity

Federal Nexus

Technical Assistance

Formal Consults

Informal Consults


1

Road and bridge construction

MS DOT

 

2

3

Utilities construction/maintenance

USACE

 

4

 

Conservation and recreation activities

USACE

 

 

4

FWS

 

 

2

Private landowner assistance

None

1

 

 


2

Road and bridge construction

MS DOT

 

2

4

Road and bridge construction

USACE

 

 

1

TMDL reviews

EPA

 

4

 

Conservation and recreation activities


USACE

 

 

4

FWS

 

 

2

Dredging

USACE

 

4

 

Private landowner assistance

None

1

 

 

3

Road and bridge construction

MS DOT

 

2

3

TMDL review

EPA

 

4

 

Conservation and recreation activities


USACE

 

 

4

FWS

 

 

4

Private landowner assistance

None

1

 

 


4



Road and bridge construction

MS DOT

 

 

4

TMDL review

EPA

 

4

 

Conservation and recreation activities


USACE

 

1

4

FWS

 

 

3

Dredging

USACE

 

 

1


5

Conservation and recreation activities


USACE

 

 

2

FWS

 

 

1


6

Conservation and recreation activities


USACE

 

 

4

FWS

 

 

1


7

Conservation and recreation activities

USACE

 

 

4

FWS

 

 

1

Dredging

USACE

 

 

1


8

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1


9

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1


10

Activities in Bankhead National Forest

USFS

 

1

18

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1


11

Water supply dams

USACE

 

1

 

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1


12

TMDL review

EPA

 

2

 

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1

Dredging

USACE

 

 

1



13


Utilities construction/maintenance

USACE

 

 

2

TMDL review

EPA

 

2

 

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

2


14

Road and bridge construction

USACE

 

 

1

Utilities construction/maintenance

USACE

 

 

1

Conservation and recreation activities

USACE

 

 

4

FWS

 

 

1

Dredging

USACE

 

4

2


15

Conservation and recreation activities

USACE

 

 

4

FWS

 

 

2


16

Road and bridge construction

GA DOT

 

 

20-30

Water supply dam

USACE

 

1

 

Utilities construction/maintenance

TVA

 

 

1

Agriculture and ranching activities

NRCS

 

 

2

FSA

 

 

1

TMDL review

EPA

 

1

 

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

4-6

Private landowner assistance

None

30-40

 

 


17

Tuskeegee National Forest activities

USFS

 

1

6

Water Quality Activities

USACE

 

 

1

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1


18

Hydropower dam relicensing

FERC

 

1

 

Utilities construction/maintenance

USACE

 

 

4

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1


19

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1

20

Utilities construction/maintenance

USACE

 

 

1

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1

21

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1

22

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1

23

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1

Dredging

USACE

 

 

1

24

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1


25

Road and bridge construction

GA DOT

 

 

10

TN DOT

 

 

4

USACE

 

1

1

Hydropower

USACE

 

1

 

FERC

 

 

1

Utility construction

TVA

 

 

1

Chattahoochee National Forest activities

USFS

20

 

13

Cherokee National Forest activities

USFS

20

 

5

Agriculture and ranching activities

NRCS

 

1

21

FSA

 

 

1

USACE

 

4

4

 

Conservation and recreation activities

USACE

 

 

2

 

FWS

 

 

30-35

 

Private landowner assistance

None

30-40

 

 

26

Hydropower dam relicensing

FERC

 

1

 

Conservation and recreation activities

USACE

 

 

2

FWS

 

 

1

Units 18 19, 20, 22

Talladega National Forest activites

USFS

 

2

21

AL Units

Road and bridge construction

AL DOT

 

10

90

Agriculture and ranching activities

NRCS

 

1

6-9

Review of statewide 303(d) lists and water quality standards

EPA

 

 

4-7

Review of NPDES permits

EPA

320

 

 

Private landowner assistance

None

120

 

 

MS Units

Review of statewide 303(d) lists and water qualitystandards

EPA

 

 

4-7

Fish stocking activities

FWS

 

 

10

Review of NPDES permits

EPA

20

 

 

Power Company certifications

None

6

 

 

GA Units

Review of statewide 303(d) lists and water quality standards

atBS

EPA

 

 

4-7

Review of NPDES permits

EPA

60-120

 

 

TN Units

Review of statewide 303(d) lists and water quality standards

EPA

 

 

4-7

Multiple Units(unknown)

EPA Special Appropriation Projects

EPA

 

3

 

TOTAL EFFORTS

629-709

65

418-450












ECONOMIC IMPACTS OF CRITICAL

HABITAT DESIGNATION                                                                   SECTION 4




 

150.           Section 3 of this analysis described the variety of activities likely to take place within the boundaries of this proposed designation that will require technical assistance or consultation with the Service, and then provides an overview of the frequency of consultations regarding these activities. This section of the analysis details the specific impact species listing and designation of critical habitat for the mussels is anticipated to have on these activities, including project modifications that may result from consultation.

 

151.           First, this section quantifies the costs of the anticipated consultations, associated project modifications, and technical assistance by activity. Importantly, these estimates include all section 7-related consultations and technical assistance efforts associated with the proposed critical habitat area. As such, this analysis does not distinguish impacts that may be attributable co-extensively to the listing of the mussels from those impacts attributable solely to the designation. This section also provides a detailed description of each anticipated consultation and technical assistance effort by activity. Exhibit 4-4 summarizes the resulting total costs associated with section 7 activity by activity in the geographic area proposed for critical habitat designation for the mussels. Further detailed costs of each activity according to unit and activity are provided in Appendix C. Exhibit 4-6 highlights the major assumptions made throughout this analysis, and offers information on the potential direction of cost bias generated by these assumptions.


 

4.1    Estimated Total Costs of Section 7

 

152.           This section quantifies low and high end cost estimates of the total technical assistance efforts, informal and formal consultations, and project modifications based on the section 7 efforts characterized in Sections 4.2 and 4.3 of this analysis. Estimates of the costs of individual consultations were developed from a review and analysis of historical section 7 files from a number of Service field offices around the country. These files addressed consultations conducted for both listings and critical habitat designations. The resulting estimates are based on an average level of effort for consultations of low, medium, or high complexity, multiplied by the appropriate labor rates for staff from the Service and other Federal agencies.

 

153.           Estimates take into consideration the level of effort of the Service, the Action agency, and the applicant during both formal and informal consultations, as well as the varying complexity of consultations. Informal consultations are assumed to involve a low to medium level of complexity. Formal consultations are assumed to involve a medium to high level of complexity. Costs associated with these consultations include the administrative costs associated with conducting the consultation, such as the cost of time spent in meetings, preparing letters, and the development of a biological opinion.

 

154.           Per-effort costs associated with formal consultations, informal consultations, and technical assistance efforts are presented in Exhibit 4-1. The low and the high scenarios represent a range of costs for each type of interaction. The Action agency or the third party may bear the costs of biological assessment, depending on the specifics of the consultation. For consultations with the USACE, administrative costs of the biological assessment are assumed to be borne by that agency. This exhibit is used to develop total administrative costs for consultations associated with activities within proposed critical habitat for the mussels.


Exhibit 4-1


ESTIMATED ADMINISTRATIVE COSTS OF CONSULTATION AND

TECHNICAL ASSISTANCE EFFORTS FOR THE MUSSELS

(per effort)

Critical Habitat Impact

Scenario

Service

Action Agency

Third Partya

Biological

Assessmentc

Technical Assistance Effort

Low

$50

N/A

$600

$0

High

$50

N/A

$1,500

$0

Informal Consultationb

Low

$400

$1,500

$1,200

$0

High

$3,100

$4,200

$2,900

$4,000

Formal Consultation

Low

$3,100

$4,500

$2,900

$4,000

High

$6,100

$9,200

$4,100

$5,600

Sources: IEc analysis based on data from the Federal Government General Schedule Rates, Office of Personnel Management, 2002, a review of consultation records from several Service field offices across the country, and communications with Biologists in the Daphne, AL FWS Field Office and the Mobile District USACE.


Notes:

Low and high estimates primarily reflect variations in staff wages and time involvement by staff reported in 2002 dollars. The high-end estimate for informal consultations, and all formal consultation estimates, include the cost of a biological assessment.

a Third parties may be State agencies.

b Internal consultations are approximately the same cost as informal consultations, unless indicated otherwise. For internal consultations, the Service bears the costs normally borne by both the Service and the Action Agency.

c A third party is assumed to bear the cost of a biological assessment. When no third party is involved, the Action Agency bears the cost, and the bearing of this cost varies from agency to agency.


 

155.           Exhibit 4-2 summarizes the administrative costs of the consultations and technical assistance efforts involving the proposed critical habitat designation for the mussels. The administrative cost estimates in Exhibit 4-2 were calculated by multiplying the number of expected consultations or technical assistance calls (Exhibit 3-1) by the per effort cost of these actions (Exhibit 4-1). Based on this analysis, the estimated total section 7 administrative costs for the mussels range from $2.62 million to $9.13 million. The high end estimate of administrative costs represents approximately 27 percent of the total section 7 costs associated with proposed critical habitat for the mussels. Third parties are anticipated to bear the majority of the administrative costs, approximately 41 percent, with the Service and Action agencies bearing approximately 24 and 35 percent respectively. This is largely due to the assumption that third partied are expected to bear the costs of a biological assessment for informal consultations with third party involvement. Where no third party is involved, the Action agency bears the cost of a biological assessment.

 

156.           The majority, 27 percent, of costs presented in Exhibit 4-2 represent administrative costs associated with consultations for road and bridge construction and maintenance projects. These administrative costs will primarily be borne by the State DOTs. Conservation and recreation activities account for another 25 percent of the total administrative costs.



<

Exhibit 4-2


ESTIMATED ADMINISTRATIVE CONSULTATION AND TECHNICAL ASSISTANCE COSTS ASSOCIATED WITH CRITICAL HABITAT FOR THE MUSSELS

(over ten years)

Action

Range

Costs to the Service

Costs to Action Agencies

Costs to Third Parties

Total Costs

Technical Assistance

Low

$31,500

$24,000

$353,000

$409,000

High

$35,500

$60,000

$1,004,000

$1,100,000

Informal Consultation

Low

$267,000

$582,000

$426,000

$1,280,000

High

$1,720,000

$2,380,000

$2,310,000

$6,410,000

Formal Consultation

Low

$202,000

$401,000

$337,000

$939,000

High

$397,000

$757,000