An Economic and Constitutional defense of Florida’s Amendment 1

Vote Yes on Amendment 1, here’s why.

Voters filling out ballots in the coming days for Florida’s November 4th election may have heard several arguments for and against Amendment 1. Many of the for arguments are environmental, and many of the against arguments are economic and legal. This blog entry provides an economic and legal argument in favor of Amendment 1. I have arranged the entry into a numbered list of the most commonly seen criticisms against Amendment 1 or the most commonly asked questions. I respond with rebuttals drawn from economic and legal scholarship. It is divided into 2 sections, starting with the legal section and ending with the economics. Skip to the ones that interest you, or read through as one piece.

Gator

Gator in the mangrove roots in Jonathan Dickinson State Park

The Legal Stuff:

 

  1. Is Amendment 1 a new tax?

No. Amendment 1, put quite simply, is an amendment to the Florida state constitution where we take a pre-existing tax (on deeds and other documents related to property) and channel a third of that revenue to a Land Conservation Trust Fund. The trust fund is set up to acquire pieces of land, like wetlands, forests, beaches and shores, rural landscapes. It can also purchase more “peopled” natural spaces, like working farms, ranches, open green space in cities, and land in the Everglades Agricultural Area. In other words, it is set up in order to purchase, protect, and restore the natural spaces that make Florida Florida. It will do this in a way where budgets for restorations are reliable and predictable.

  1. Why a trust fund?

A lot of important things in the U.S. are financed by taxes and the money is sent to trust finds. The most obvious example is Social Security, which takes a payroll tax and puts it into a trust fund. Also, the Highway Trust Fund used to build our nation’s interstates comes from your gasoline taxes.

 

  1. Is placing an environmental amendment in the state constitution an over reach of government power?

Some citizens groups criticize Amendment 1 saying that state constitutions are no place for amendments that deal with topical issues, like the environment. Even the most cursory glance of the legal scholarship on state constitutions would show you this is not true. Beginning in the 60’s and 70’s America saw a “flood tide” of constitutional updating, with environmental amendments as major components of these updates. Environmental conservation articles attached to state constitutions (such as Amendment 1) are commonly considered to be “fundamental inclusions” that are worthy of a state constitution. Florida, along with many other states (including but by no means limited to NY, MI, IL, PA, RI, and VA), has seen environmental amendments to its constitution made since 1970 (Source: Howard 1972).

  1. So if state constitutions have had environmental conservation amendments since the 1970s, then why are anti-Amendment 1 groups making this argument?

Well, they’re seeing what sticks, and recently, this sticks. Certain partisan figures, like those on talk radio, use the constitution to make opinionated claims about the proper size of government. The constitution (both federal and state) gets used a lot to justify rigid and ideological political opinions. These opinions often involve the scaling back of government services, such as environmental protection. The reality is that this type of environmental conservation amendment (in a state constitution) is by no means 1) an over reach of power by the state, 2) an example of government over-reach, or 3) a substantial deviation from what we are already doing in Florida.

In fact, I would say Amendment 1 is not big government at all, but status quo-sized-government. Why? Because state courts rely on what is known as “self execution” for constitutional amendments in order to determine if they’re legal. This means that the amendment needs to be a clear, complete, and enforceable rule. Amendment 1 takes a tax that already exists and sets the money aside to buy land for conservation purposes. (Source: Fernandez 1993).

Everglades National Park

Everglades National Park

The Economic Stuff:

  1. Why conserve land at all?

Think about the following story. Imagine two identical houses, one with a view of the beach and the other one on a regular suburban block about 20 minutes drive from the beach. The one on the beach will sell for a far higher price because of its natural surroundings. People value nature and we display this all the time in our a market economy. This story symbolizes the economic value of Florida’s conserved resources, both to the people who live there and to the tourists who visit. Conserved land (and the ecosystems on them, like reefs, wetlands, forests, rivers) is a major component of Florida’s tourism economy. The Everglades received over a million visitors in 2013, and Big Cypress National Preserve another million. That’s a lot of hotels, rental cars, and meals in local diners.

These are the more visible and obvious ways to value conservation. In the following sections, I discuss the other types of economic value are harder to notice but equally (if not more) important. These types of values help answer question 2.

South Beach, Miami

South Beach, Miami

  1. Does the conservation of land mean that it is no longer useful in enhancing economic growth, because you can’t tax it or develop it?

No. Many organizations that have come out against Amendment 1 say that once you cordon off land for conservation, it becomes worthless to our economy. The exact opposite of that is true. These so-called economic arguments ignore 40 years of science and economics on the true economic values of Florida environments; I expand on this science in numbers 3-5 below. These arguments are dangerous because they present a false choice between economic development and conservation. Florida is a state built on the tourism industry, and the tourists are not coming for strip malls, polluted waterways, dead manatees, and parking lots, they are coming to sip a cold drink on our clean shorelines, charter a fishing boat to catch a big fish, or hike the Glades to see some big gators.

A boat for charter in Key Largo

A boat for charter in Key Largo

 

  1. What concrete economic benefits do lands used for conservation provide?

First, let’s think about ecosystems. Ecosystems are made up of all the plants and animals plus all of the soil, air, and water that they call home. We can easily recognize some common examples of ecosystems, such as wetlands, oceans, swamps, and so on. Florida ecosystems actually do a lot of things for us that we don’t really think about in our day to day lives, like giving us fresh water, land where can grow crops, coral reefs that can slow down big waves caused by hurricanes, fish for our blackened hogfish sandwiches and so on. We can call these things that ecosystems do for people “services” or “benefits”.

Ecosystems offer two types of economic benefits, ones that we can easily count (the price of a hogfish at the market) and ones that are pretty hard to count (the benefits from wetlands changing polluted runoff into clean drinking water—yes they can do this!). In Florida, the difficulty involved in counting up all of the ecosystem services and benefits means that they are constantly and systematically undervalued in public discussions on decision-making and the environment. We are making policy decisions without having all of the information first.

So where can we find this information on the real value of Florida’s ecosystems? For a few decades, thousands of scientists all over the world have been studying the economic value of these ecosystem services. The results of thousands of scientific studies are in a global database that is free and easy to use. I want to use just a small portion of their findings in order to show you a figure closer to the true economic value of just one Floridian ecosystem (Sources: Costanza et al. 1997, De Groot et al. 2012, Costanza et al. 2014).

Sunset at Everglades National Park November 2013

Sunset at Everglades National Park November 2013

  1. What would the economic value of conserving Florida’s swampland be?

It would take me a ton of time to go through every type of ecosystem that Amendment 1 would allow the state to purchase for conservation, so I’ll pick one: swamps (let’s call them wetlands).

I am first going to list the valuable ecosystem services that wetlands provide to people. Then, I use published science to list out the economic values of these services, i.e. what these environments are really worth, in terms of dollar amounts. Then, with this new information, we can return to the question of the economic value of conservation land posed in the beginning.

Specific Economic Benefits of Wetlands:

  1. Wetlands regulate the amount of carbon dioxide in the air, turning it back into breathable oxygen through photosynthesis (a word that just means that plants are using light to make food). Wetlands lessen greenhouse effects that are responsible for a changing climate.
  1. Wetlands act like barriers to hurricanes, buffering coastal inhabitants from storm surge and flooding. Their dense plant life impedes and slows storm surge, and they hold water that could otherwise flood our communities in hurricane season.
  1. Wetlands supply us with drinking water.
  1. Wetlands, through chemical processes that are hard to see, actually create very fertile soil for agriculture. This is why the big area just south of Lake Okeechobee was converted into farmland (the Everglades Agricultural Area). This is also why there is so much agriculture around the Everglades and Loxahatchee National Wildlife Refuge.
  1. Wetlands cycle waste into clean water, and they also clean polluted water that is filled with nutrients from fertilizers and animal wastes, or other types of runoff.
  1. Diseases and the things that cause them (think mosquitos and West Nile virus) are soaked up and concentrated in swamps, away from us and our communities.
  1. People come from all over the world to boat, fish, and hike in our wetlands. Over a million people came to Florida to enjoy the Everglades and another million for Big Cypress National Preserve. Count their car rentals, hotels, meals, and souvenirs, and that is a lot of money.
  1. Wetlands provide food such as fish (channel catfish, blue gill, panfish, redear) and plants that can be used for pharmaceuticals.

One way that you can think of the economic values is considering how much we’d have to pay if we had to replace all of the wetlands in Florida, and instead cleaned and treated all of our water in manmade facilities? What would it cost us to remove all the fertilizer runoff ourselves? What would it cost us to build flood control structures for storms?

air plants in an Everglades slough

air plants in an Everglades slough

  1. Now we know what they do for us, but how much are these services actually worth?

The first thing that we need to establish is that Florida has 8 million hectares of wetlands. How big is a hectare you may ask? A hectare is a metric unit for 10,000 square meters. Think of a professional soccer field. This is a bit smaller than a hectare. So any value you see here needs to be multiplied by 8 million in order to calculate the real annual economic value statewide of Florida wetlands.

Say we only wanted to compute the value of hardest to count services, i.e. the value of services 1-6 in my list above. These services put together are worth $171,364 per hectare of wetland per year. So take this value, and multiply it by 8 million hectares of Florida wetlands. We get an annual benefit to the state of Florida worth 1.37 trillion dollars annually.

What about the value for the last two services on my list (7-8) recreation and fishing? Wetlands provide $25,000 per hectare per year in total services. Again, multiplied out by the total Florida wetland area is over $200 billion dollars in recreational services.

Breaking down some specific services, let’s look at wastewater treatment. This alone is worth $3015 per hectare per year. Across Florida, this service is valued at over $24 billion. Wetlands prevent flooding when those famous Florida afternoon storms hit. This service is worth $5607 per hectare of wetland each year. Across the state, wetlands preventing floods can be valued at $44 billion.

What about the services that ecosystems provide to just animals, are these of any value? Consider how wetlands serve as habitat for Florida species of birds and fish. Well, those seemingly animal-only values and benefits are a bit more complicated than they seem. The wetlands serve as nurseries to many species of fish that grow up to become commercially valuable. The economic value provided by one hectare of wetlands that act as a nursery for juvenile fish is over $1287 per hectare per year. Multiply this out across the state, and you are talking about a value approaching 10 billion dollars.

The sources of these numbers are several studies that examine every single estimate made on the valuable things that environments do for people across thousands of studies all over the world. Is it 100% accurate and unique to Florida wetlands? No, but at the very least, it gives us a new way to think about economics and the environment not limited to simplistic policy choices. Think of it like a model of a town: there are exaggerations in scale, along with things that are too small or left our completely, yet it still helps you see the lay of the land. But it is not the town itself. (Source De Groot et al. 2012, Costanza et al. 1997, Costanza et al. 2014).

Rich farmland adjacent to Everglades National Park

Rich farmland adjacent to Everglades National Park

Conclusion

If I were to do this for all of the different ecosystems that Amendment 1 would protect for the people of Florida, values would be in the trillions. As I mentioned at the beginning of this piece, these ecosystems could include “wetlands, forests, fish and wildlife habitats, beaches and shores, recreational trails and parks, urban open space, rural landscapes, working farms and ranches, historical and geological sites, lands protecting water and drinking water resources and lands in the Everglades Agricultural Areas and the Everglades Protection Area.”

So, next time you hear about environmental conservation costing Florida tax payers a ton of money, think about the services ecosystems provide for us that we cannot see every day, that are hard to count, or the ones that we take for granted, and then think about the immense economic value they have to Florida society.

References:

Costanza, R., d’Arge, R., Groot, R. D., Farber, S., Grasso, M., Hannon, B., … & Belt, M. V. D. (1997). The value of the world’s ecosystem services and natural capital.

Costanza, R., de Groot, R., Sutton, P., van der Ploeg, S., Anderson, S. J., Kubiszewski, I., … & Turner, R. K. (2014). Changes in the global value of ecosystem services. Global Environmental Change, 26, 152-158.

de Groot, R., Brander, L., van der Ploeg, S., Costanza, R., Bernard, F., Braat, L., … & van Beukering, P. (2012). Global estimates of the value of ecosystems and their services in monetary units. Ecosystem Services, 1(1), 50-61.

Fernandez, J. L. (1993). State Constitutions, Environmental Rights Provisions, and the Doctrine of Self-Execution: A Political Question. Harv. Envtl. L. Rev.,17, 333.

Howard, A. D. (1972). State Constitutions and the Environment. Virginia Law Review, 193-229.

The unofficial, emblematic symbol of Florida, the manatee

The unofficial, emblematic symbol of Florida, the manatee

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