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7
Recreation and Nonuse Values
THE ROLE OF ECONOMIC VALUES IN GOES AND THE EIS
Much of the research under the Glen Canyon Environmental Studies
(GOES) was physical and biological. Economic research also became an
integral component of the research program. Economic research had three
foci. First, economic tools were used to quantify, in monetary terms, the
effects of dam operations on the quality of river recreation. Second, econ-
omic tools were used in analyzing the effects of dam operations on values
held by those who do not directly use resources affected by dam operations
(i.e., nonuse values). Third, economic analysis was used in quantifying the
linkage between operating criteria and value of the electricity generated atthe
dam.
It is important to keep in mind that the economic studies focus on valuing
the effects of alternative dam operations, not on the river as a whole. This
chapter acldresses the use of economic methods to document changes in the
value of recreational opportunities associated with changes in dam op-
erations. It also explains the concept of nonuse values, their relevance to
dam operations, and the results of nonuse value studies. Chapter 9 sum-
marizes and evaluates GCES work on the economics of power generation at
Glen Canyon Dam.
Use and Nonuse Values Defined
Recreation and power values are use values because they stem from the
direct use of river resources to produce electrical and recreational benefits.
118
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Recreation and Nonuse Values
119
Policymakers, economists, and the public question whether the economic
values of environmental resources should be limited to use values (HBRS,
1991, Harpman et al., 1995~. For example, those who have not visited the
Grancl Canyon may place an economic value on the preservation of its
resources for future generations or their own option to use the canyon in the
future. Such values are often called nonuse values. They are motivated by
value attached to the continued existence or preservation of a resource or the
resource's for future generations (Chapter 3~. Nonuse values are not held
only by "nonusers." Visitors to the river corridor below the clam may hold
nonuse value in addition to use value. Environmental economists have
developed a theory of total value, which consists of use and nonuse values
(HBRS, 1991, Harpman et al., 1995~.
Questions about the effects of dam operations on the total value of the
resources downstream from Glen Canyon Dam are appropriate because
federal law requires, as part of the environmental impact statement (EIS)
process, consideration of the economic implications of alternatives.
The economic theory and empirical measurement techniques relevant to
nonuse values in resource valuation studies have evolved rapidly during the
past decade (HBRS, 1991, Harpman et al, 1995~. As a result, nonuse values
have been included in a variety of policy analyses for which changes in the
quality or availability of natural resources are an issue. Perhaps the most
important example is the rules for assessing damages to natural resources
from spills of oil and toxins under the Comprehensive Environmental
Response, Compensation, and Liability Act and the Clean Water Act (U.S.
Department of the Interior, 1991~. A U.S. Court of Appeals decision in 1989
strengthened the role of nonuse values in such cases, and nonuse values
were important in arriving at a negotiated settlement on liability for the Ewon
Valdez oil spill. More recently, the National Oceanic and Atmospheric
Administration convened a blue-ribbon panel that evaluated the validity of
methods for measuring nonuse values and developed guidelines for mea-
suring nonuse values in natural resource damage assessment (NOM, 1993~.
In addition, several federal agencies are writing administrative rules for the
measurement and application of nonuse values to public policy processes.
Measurement of Nonuse Values
While the validity of nonuse values is well established in theory, such
values cannot influence policy decisions unless they can be measured
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River Resource Management in the Grand Canyon
accurately. Measurement of nonuse val ues relies on the contingent valuation
method (CVM), which quantifies willingness to pay. There has been sub-
stantial debate among economists and other social scientists over the
quantification of willingness to pay. Although contingent valuation continues
to be controversial, there is a growing body of evidence that supports its
practical usefulness (Harpman et al., 1995~. Contingent valuation is routinely
applied with confidence to estimates of use values, and earlywork on nonuse
values is encouraging.
Whether nonuse values can be measured with sufficient accuracy to meet
high scientific standards is a question still widely discussed among policy
analysts and economists. There is, however, a theoretical economic frame-
work sufficient to form a foundation for their use in the GCES. The literature
on CVM indicates that accuracy is sufficient to make quantification of nonuse
value useful in understanding the balance of values at stake in managing Glen
Canyon Dam. This is particularly true given all that can be learned in the
nonuse valuation process regarding public views of the resource issues being
addressed under GCES. To neglect total values in favor of more narrowly
defined use values would be to leave a major gap in the economic studies
under GCES and in the Glen Canyon Dam EIS. This would be unjustifiable
given that nonuse values can be estimated.
OVERVIEW OF RECREATIONAL USES
Recreation is an important use of the Colorado River below Glen Canyon
Dam. Each year over 20,000 anglers, 33,000 day-trip rafters, and 15,000 to
20,000 white-water boaters use this section of the river. The GCES examined
recreational use patterns and values in considerable detail and focused on
those types of recreation most likely to be affected by changes in the dam's
operations.
The 15-mile segment of the Colorado River immediately below Glen
Canyon Dam is located in the Glen Canyon National Recreation Area. It is
used by a variety of recreationists, including fishermen, boaters, day rafters,
campers, bird watchers, and hikers. Below the Glen Canyon reach the
Colorado River flows through Marble and Grand canyons for 277 miles,
including over 160 recognized rapids. Some of the world's most challenging
and exciting white waters occur here. Below the Grand Canyon, Hoover Dam
holds back the Colorado River to form Lake Mead, which is one of the largest
reservoirs in the western United States. The dam's operation affects the
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Recreation and Nonuse Values
121
experience of recreationists using the Colorado River in Glen Canyon and the
Grand Canyon.
In 1987 a study of river-based recreation between Lakes Powell and Mead
was completed by Bishop et al. The goals of the study were to document the
quantity and pattern of river-based recreational use, to identify factors having
a significant effect on the net economic value of recreational use, and to
estimate the net economic value of river-based recreation. The authors
identified four major categories of river-based recreational use: (1) day
(scenic) rafting in Glen Canyon, (2) angling in Glen Canyon, (3) commercial
white-water boating in Grand Canyon, and (4) private white-water boating in
-Grand Canyon.
Bishop et al.'s early survey work (Bishop et al., 1987) involving anglers
and boaters determined that the value of angling and white-water boating is
affected by river stage and daily fluctuations but that day rafters are not
particularly sensitive to these aspects of dam operations. Consequently, the
economic effects of operational alternatives on day rafters are negligible;
Fishing in Glen Canyon
The Glen Canyon trout fishery is a by-product of Glen Canyon Dam.
Discharge from the dam is colder, carries less silt, and is more stable on an
annual basis than prior to construction of the dam. This altered environment
supports a good trout fishery. The Arizona Department of Game and Fish
(ADGF) stocks up to 100,000 rainbow trout in some years; in more recent
years, brook trout and cutthroat trout also have been stocked. Surveys of
Arizona anglers conducted by ADGF indicate that trout are the most desired
sport fish in the state, but preferences among trout species and between
native and stocked trout have not been well documented, as pointed out in
1987 by the NRC committee (NRC, 1987~.
The introduced trout have created an important fisherythat is considered
to be of high quality. Glen Canyon is one of only two blue-ribbon stream
fisheries in Arizona. Each year more than 19,000 anglers fish for rainbow
trout in the 1 5-mile reach below the dam.
Bishop et al.'s (1987) study also revealed that the attributes most strongly
affecting the Glen Canyon fishing experience are the site and number of fish
the respondent expected to catch. Fishing success is believed to be related
to flow in two ways. Rising water may improve fishing as fish begin to feed
on invertebrates that are dislodged in this way. In addition, flows of 10,000
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River Resource Management in the Grand Canyon
cubic feet per second (cfs) and less provide gravel and rock bars for fishing
and some room for bank fishing between the water's edge and shore
vegetation. Low flows limit boaters ability to get upstream.
Fishing in Grand Canyon
Fishing in Grand Canyon is likely an activity incidental to white-water
boating or backpacking, except in some side canyons around Marble
Canyon. The National Park Service (NPS) controls access to these wild trout
fisheries by issuing back-country and river permits. Commercial river com-
panies are not allowed to offer trips that are primarily for fishing in Grand
Canyon, even though fishing is allowed as an incidental activity on river trips.
Day Rafting
In 1991 more than 33,000 visitors took half-day tours of the Glen Canyon
reach. Bishop et al. (1987) found that the only flow-sensitive attribute of a
Glen Canyon clay-raft trip may be from where the trip originates. At low-to-
moderate flow levels (generally less than 29,500 cts), the 20-person tours
depart from a dock near Glen Canyon Dam and float or motor downstream
to Lee's Ferry. When releases are above 29,500 cfs and outlet works are in
use, departure from the base of the dam is unsafe due to the volume and
turbulence of the water. In these cases, rafts normally depart from Lee's
Ferry carrying fewer people (10) and motor part way upstream before floating
back downstream.
White-Water Boating
White-water boating in Grand Canyon is a major industry; 21 companies
have permits to conduct commercial raft trips in the park. Also, the Hualapai
Tribe conducts river trips from Diamond Creek to Lake Mead. Each year
15,000 to 20,000 commercial and private boaters annually run the river. The
number of user-days is restricted to 1 15,500 for commercial trips and 54,450
for private parties. White-water boating use is limited to 166 visitors per day
during the primary season (May 1 through September 30~. These limitations
were designed to maintain boating safety, reduce crowding on the river, and
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Recreation ant! Nonuse Values
123
minimize damage to riparian resources. The regulations preclude any
increases in use of the river for white-water boating. Motorize trips are
allowed to launch from mid-December through mid-September. Oar-powered
craft can be used throughout the year. The size of private groups averages
less than the limit of 16, while commercial group size usually is 36 people.
The lower gorge, which begins at Diamond Creek, is used by the Hualapai
Tribe concession as well as by other commercial and private rafters. Most
commercial and private raft trips take place between May and October.
Bishop et al. (1987) asked white-water boaters to identify the attributes
that contribute most to an excellent Grand Canyon white-water trip. Of the
attributes listed by at least 1 5 percent of all respondents, four are potentially
affected by dam operations: time for layovers and stops at specific sites,
rapids, wilderness experience, and not feeling crowded.
Rivertrips make planned stops at attractions located along the tributaries
and side canyons and also include scheduled short or extended day hikes.
These stops are important attributes of white-water trips. During low flows,
both commercial and private trip passengers may miss one or more sites
because of the additional time needed on the river to maintain a trip schedule.
Rapids are also important attributes of white-water boating trips (Bishop
et al., 1987~. Rapids are flow related because a number of small-to-medium
rapids become less exciting to run at high flows, while larger rapids generally
become more exciting to run at high flow. Also, guides and trip leaders are
more likely to have passengers walk around major rapids at the highest flows
(above 35,000 cfs). At low flows (5,000 cfs or less), it often becomes ne-
cessary to either walk passengers around some rapids or to wait for higher
water.
One of the attributes of an excellent river trip most often identified by river
runners is a wilderness experience. Enjoying a wilderness experience is more
important to private rafters and oar trip passengers and less important to
commercial and motor passengers. Most river runners are aware of wide
daily fluctuations, and most feel that the fluctuations make the setting for the
trip seem less natural (Bishop et al., 1987~.
White-water boaters may feel most crowded at high flows because the
number and size of beaches for camping are significantly reduced. In
addition, during daily fluctuations in flows, boaters may congregate above
rapids as they wait for the water level to rise. Flows affect the usable area of
a camping beach. The rise and fall of water levels that result from fluctuating
discharges (Chapter 4) inundate portions of beaches, strand boats, and
influence the character of the setting. Daily fluctuations influence campsite
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River Resource Management in the Grand Canyon
selection in that many river runners will not choose a campsite that does not
offer protection against changes in water level (Bishop et al., 1987~. An
average of 35 percent of potential campsite area is inundated when releases
increase from 5,000 to 25,000 cfs.
Bishop et al. (1987) asked white-water boaters and commercial white-
water guides to provide reports on the quality of their Grand Canyon white-
water trips. Both the guides and the passengers reported the highest quality
for trips during periods of constant flows in the range of 25,000 to 30,000 cfs.
For a variety of reasons, however, it is impractical to release 30,000 cfs over
long periods of time to increase the quality of white-water trips (Chapter 4~.
River levels affect accident rates; flood flows and low flows are believed
to be the most hazardous. Fluctuating flows are not considered a significant
factor in river safety. At low flows, major rapids become difficult to navigate.
Kearsleyand Warren (1992) analyzed mooring conditions forwhite-water
boaters at 129 campsites. Mooring conditions were influenced by large
fluctuating flows at all sites. This study indicated that better mooring quality
exists under constant flows than under fluctuating flows.
Recreation at Lakes Powell and Mead
Lake Powell is the second-largest reservoir in the western United States.
Glen Canyon Dam and its power plant were designed to operate between the
water levels of 3,490 and 3,700 feet above sea level. In this range the lake has
a water surface area of 52,000 to 163,000 acres and a shoreline that is 990 to
1,960 miles long. Lake Powell provides several major categories of re-
creation: lakeshore and back-country camping, campground use, fishing,
boating, beach use, and picnicking. Fluctuations in water level are un-
avoidable for Lake Powell (Chapter 4~. The highest water levels generally
occur between April and June and the lowest levels between February and
March.
Lake Powell has five marinas, and some expansions and additions are
being planned. Normal lake fluctuations influence recreational boating
because changing water levels affect access to the water via developed
facilities. A change in reservoir levels requires adjustments in facilities,
including marinas, docks, buoys and buoy lines, breakwater barriers, channel
markers, and ramps.
Boaters use the stretch of Luke Mead where the Colorado River enters the
lake for scenic boating, fishing, water skiing, and other recreational pursuits.
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Recreation and Nonuse Values
125
Navigability in this interface between Lake Mead and the river may be affected
by dam operations.
Recreation and Native American Tribes
A substant al portion of the Hualapai Tribe's gross revenue is clerived from
river-based recreational activities. The largest of these activities iswhite-water
boating. The Hualapai Tribe owns and operates Hualapai River Runners, a
commercial white-water boating company. Hualapai River Runners is one of
four enterprises operated by the Hualapai Tribe and was the major source of
tribal income in the 1980s. In addition to offering white-water boating trips,
Hualapai River Runners provides shuttle services, tows across Lake Mead,
and access for river takeouts at Diamond Creek. In 1987 it earned 49 percent
of the Hualapai Tribe's gross income.
The tribe has diversified its business interests and now depends less on
river-based recreational activities than it did in the past. Nevertheless, the
tribe earned about 33 percent of its total 1991 income from such activities.
The net economic value of commercial white-water trips that launch at
Diamond Creek by arrangement with the Hualapai Tribe was estimated by
data from Bishop et al. (1987) on commercial white-water boating in the
Grand Canyon. No separate economic value study was conducted for
commercial trips launched by the Hualapai Tribe at Diamond Creek.
The Navajo Reservation borders portions of Glen Canyon National
Recreation Area and Grand Canyon National Park. There has been little
development of business enterprises in this region because of a federal
statutory freeze that has precluded construction or development on this
portion of the reservation, pending resolution of a territorial dispute. The
development ban was l fled recently, and river-based enterprises may develop
in the near future. At the present time, however, no river-based enterprises
owned or operated by the Navajo Nation have been documented.
Although several other tribes have land bordering Grand Canyon National
Park or have current and historical ties to the Grand Canyon, no river-based
enterprises owned or operated by these tribes have been documented.
ECONOMIC EFFECTS OF DAM OPERATION ON RECREATION
The effects on recreational activities of various operational schemes for
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River Resource Management in the Grand Canyon
the Glen Canyon Dam are summarized in the operations EIS (BOR, 1994~.
The EIS gives numerical values where possible; otherwise, it gives qualitative
assessments. Assessments are based on rankings of alternative operational
scenarios in a study of visitor preferences by Bishop et al. (1987~. Each
alternative was ranked as more or less favorable for recreation overall and for
each of several indicator activities. Indicator activities in the EIS include
fishing, day rafting, white-water boating, and lake facilities and activities.
Effects of habitat maintenance flows (Chapter 5) are discussed in the EIS
under the three alternatives that include such flows.
Background on Economic Methods Used
Two economic measures-the net economic value of recreation and the
regional economic impact of recreation-were used in GOES to estimate the
national and regional economic effects of proposed alternatives for dam
operations.
Table 7.1 summarizes the net economic value of various recreational
activities under different types of water release years. The net economic
value of an activity is its net addition to the nation's output of goods and
services, measured in clollars. The net economic value is a measure of the
value of an activity above the actual costs of participating in the activity.
Bishop et al. (1987) used the contingent valuation technique to analyze
the economic effects of dam operations on recreation. They presented
recreationists with descriptions of recreational opportunities at several dif-
ferent flow levels and asked them to state their willingness to pay for these
recreational opportunities at different flow levels. Bishop et al. found that the
value of angling and white-water boating was related to flow and that there
were significant differences between the effects of flow on commercial and
private white-water boaters.
Statistical models for angling and commercial and private white-water
boating were developed by Bishop et al. (1987) and HERS (1993~. These
statistical models describe the relationships among the economic benefits of
each recreational activity, the average flow during the month, and the
occurrence of fluctuations exceeding 10,000 cfs during the month. For each
type of activity, the model calculates net economic benefits per trip and then
aggregates benefits over the actual distribution of trips recorded in 1991.
The statistical models predict the same economic benefits for several of
the alternatives in the EIS because some alternatives have the same average
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Recreation and Alonuse Values
127
TABLE 7.1 Net Economic Value of Recreation (annual benefits in 1991 nominal $ millions)
Commercial White- Private
Commercial Water Boating White
Type of Release White- Below Diamond Water
{year) Anglers Water Boating Creek Boating Total
Low (1989) 1.3 5.4 0.104 1.1 7.904
Moderate (1987) 1.2 6.4 0.122 1.2 8.922
High (1984) 1.1 12.4 0.230 2.0 15.730
SOURCE: BOR (1995).
monthly flows and the same degree of fluctuations over 10,000 cfs. For
example, both the Interim Low Fluctuating Flow and Existing Monthly Volume
Steady Flow Alternatives have the same average monthly flows. There would
be nofluctuations underthe Existing MonthlyVolume Steady Flow Alternative
and no fluctuations over 10,000 cfs under the Interim Low Fluctuating Flow
Alternative. Consequently, the statistical models do not distinguish between
these two alternatives. Likewise, the No Action, Maximum Power Plant Ca-
pacity, and High Fluctuating Flow Alternatives all allow daily fluctuations
exceeding 10,000 cfs and have identical average releases.
Much of the white-water boating use occurs during the summer months.
Most of the angling use occurs during the spring and fall. These patterns of
use have important effects on the generation of net economic benefits. To
the extent that net economic benefits are directly determined by flow, chan-
ges in flow during periods of high recreational use produce larger changes
in net economic value than similar changes in flow occurring at other times
of the year.
Regional economic impact is a measure of the importance to the local
economy of the expenditures. Since expenditures made by recreationists
reflect the costs of participation, they are not considered benefits from the
national point of view end are not included in the calculation of net economic
value.
River-based recreationists, such as anglers and white-water boaters,
spend large sums of money in the Grand Canyon region. Such expenditures
provide some measure of the local impacts of recreational users. Direct
expenditures alone, however, do not fully measure the effects of spending by
visitors to the region. Local businesses and residents spend part of the
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River Resource Management in the Grand Canyon
money they receive from anglers and white-water boaters to purchase goods
and services from other individuals and local businesses. These individuals
and businesses, in turn, spend a portion of their revenue in the region, and so
on. Because a portion of each dollar spent by nonresident recreationists is
respent over and over in the region, the effect of each dollar of direct
expenditure by visitors is greater than $1. A multiplier relates the amount of
nonresidential expenditure to the total amount of local economic activity
produced by the visitor's spending. Multipliers allow the effect of nonresident
expenditures to be more fully assessed. The U.S. Forest Service's Impact
Analysis for Planning model (Taylor et al., 1992), a sophisticated framework
for assessing regional effects of expenditures, was used to estimate multi-
pliers for this analysis.
Estimates of average expenditures by anglers and white-water boaters
were obtained by Bishop et al. (1987~. Commercial white-water boaters
generate most of the economic activity in the region. In total, river-based
recreational users generated some $23 million in local economic activity in
1991. Because the number of white-water boating trips is not expected to
change and the number of angling trips taken is held constant for this an-
alysis, there is no change in regional economic activity for any of the altern-
atives listed in the EIS.
Economic Effects of Dam Operations on Anglers
The quality of a fishing trip for most anglers in the Glen Canyon reach is
highest during moderate steady discharges because such discharges appear
to improve several attributes of fishing trips. Presently, there are no con-
straints on the number of anglers permitted to fish in Glen Canyon. The
number of fishing trips to the area in any given year varies with general
economic conditions, fishing regulations, and the quality of the fishery.
Anglers using the Glen Canyon trout fishery place a high value on large
fish. Under the EIS fluctuating flow alternatives, including no action, trout
were assumed to be less likely to reproduce and survive until they reach
trophy size. Underthe Moderate, Modifiecl Low, and Interim Low Fluctuating
Flow Alternatives, the potential for catching large fish was assumed to
increase, and therefore fishing trip quality also would have the potential to
increase. The underlying validity of this assumption is questionable (Chapter
6), but the economic analysis does show the sensitivity of the value of the
fishing to fish population size and age structure.
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Recreation and Nonuse Values
129
Rapid changes of stage put wading anglers in Glen Canyon at risk of
inur~ation. This risk would be reduced under the alternatives with ramp rate
restrictions and would be eliminated in the steady flow alternatives.
Downstream in the Grand Canyon, angler safety is not believed to be
significantly affected by dam operations, primarily because most fishing
activities take place from boats or from shore.
Studies in other basins have documented a relationship between angling
quality and the number of trips taken. In these studies, angling quality has
been related to the species, number, and size of fish caught as well as by the
presence of native fish in the catch. Some ways of operating Glen Canyon
Dam may change these factors for anglers who fish below the dam. A
change in the quality of the fishery might result in the total amount of fishing
that takes place. Biological models that could predict angling quality are
unavailable, however, and economic models that could predict the amount
of fishing based on the quality of the fishing have not been developed. As a
result, it is not possible to predict changes in the economic value of angling
as a function of dam operations.
Economic Effects of Dam Operations on Day Rafting
Boaters in the Glen Canyon reach, most of whom are anglers, have
d fficulty navigating around sand bars when discharge is 3,000 cfs or less.
Most boaters are unable to move up or downstream, and some of those
attempting to do so hit rocks and sustain boat and motor damage.
Minimum flows of 5,000 cfs eliminate navigation and safety considerations
for most day rafters and other boaters. Steady flows make sand bars
passable to all boaters.
All EIS alternatives were treated as having similar influences on day
rafting. Also, habitat maintenance flows (occasional high flows) are unlikely
to have any effect on the quality of day rafting below Glen Canyon Dam.
Because the alternatives do not differ significantly for day rafters, the
economic effects of changing operations are estimated as zero.
Economic Effects of Dam Operations on White-Water Boating
White-water boaters prefer moderate fluctuations and steady flows
because of their influence on itinerary, character of rapids, wilderness values,
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River Resource Management in the Grand Canyon
and boat management at camp. White-water boaters were asked to rank
several operational scenarios in the study by Bishop et al. (1987~. Of the EIS
alternatives, the steady flow would be most preferred by this group. Fluc-
tuating flow alternatives with daily range and ramp restrictions and 5,000-cfs
minimum flows are more acceptable than those without such restrictions.
Wilderness values are influenced by daily fluctuating flows. When the
river undergoes wide daily fluctuations, most river runners are aware of these
fluctuations and think they make the setting seem less natural (Bishop et al.,
1987~. Fewer river runners would be aware of more moderate daily fluc-
tuations.
An index of white-water accident risk (Brown and Hahn, 1987) was used
to compare the safety of alternatives. At low flows, accident potential is
greatest for commercial motor and small oar-powered craft. Risk is reduced
most by steady flow; restricted fluctuating flow reduces risk half as much as
steady flow.
The accessibility of the river to the handicapped was raised as an issue
for the EIS and is a concern for NPS, which issues permits preferentially for
trips with handicapped individuals. Effects on accessibility follow the same
pattern as general accident risk.
The number, size, and character of camping beaches in the Grand
Canyon have a direct effect on the total recreational capacity of the river
corridor and the experience for white-water recreationists. Under the fluc-
tuating flow alternatives, the distribution of sites within power plant capacity
would be 0.7 sites per mile in narrow reaches and 1.1 sites per mile in wide
reaches. Steady flow alternatives would support 0.9 sites per mile in narrow
reaches and 1.1 in wide reaches.
The size of a particular camping beach is highly variable in relation to
flow. In most years the area suitable for camping would average 7,720 ~2 or
less under the fluctuating flows and up to 9,200 ft2 under steady flows.
Fluctuating flows influence mooring and cause boat management problems
and stranding. Under the fluctuating flow alternatives, mooring would be fair
to good at 64 percent of camping beaches; under steady flow, 92 percent
would be fair to good.
Economic Impacts of Dam Operations on Native American Tribes
A number of commercial and private white-water boating trips launch
from Diamond Creek on the Hualapai Reservation. White-water boating use
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Recreation and Nonuse Values
131
below Diamond Creek, as measured by the number of trips taken, is expected
to increase over time until use reaches capacity limits. The nature and timing
of this increase cannot be reliably predicted. Changes in the number of trips
are expected to be unrelated to clam operations.
SUMMARY OF EFFECTS OF DAM OPERATIONS ON RECREATION
The majority of recreational benefits are derivecl from commercial whRe-
water rafting, which in general is positively related to average daily flows and
negatively related to fluctuations. Alternatives that increase average summer
flows or eliminate daily fluctuations in excess of 10,000 cts tend to increase
recreational benefits. The estimates of net economic benefit are based on the
statistical relationship between flow and recreation holding all other factors
constant at the time of the study. Therefore, these benefit estimates do not
accountforanylong-term changes in the recreational environment/hat might
affect value. Table 7.2 shows expected changes in the equivalent annual
value of recreation under different alternatives, as estimated in the EIS (BOR,
1 995~.
STUDIES OF NONUSE VALUE
The final EIS (March 1995) includes a brief but useful discussion of the
conceptual basis for nonuse values, their potential magnitude, the reasons
why people hold nonuse values, the resources to which nonuse values may
apply, and methods used by GOES to assess nonuse values. Preliminary
studies indicated that quantification of nonuse values associated with Glen
Canyon Dam operations is feasible. Participants were able to distinguish
effects on the river corridor from effects on the Grand Canyon in general and
indicated that they, as nonusers, would be affected by changes in dam
operations. A full-scale nonuse value study was completed in mid-spring
1995. Findings from the survey of 2,550 households in the Colorado River
Storage Project power marketing area and 3,450 households in the United
States as a whole have been made available as a GOES report (Welsh et al.,
1995~. The results, summarized below, show that substantial nonuse values
are at stake with regard to managing dam operations.
The nonuse value work examined public values associated with only three
main alternatives for operating the Glen Canyon Dam, even though the EIS
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River Resource Management in the Grand Canyon
TABLE 7.2 Change in Equivalent Annual Value of Recreation for the 50 year Planning Period,
as estimated by BOR for the operations ElSa
Changes in Equivalent Annual Value Compared to No Action
(1991 ~ millions)
White
Water
Boating
Commercial Below
White-Water Private White- Diamond
Alternative Anglers Boating Water Boating CreekTotal
No Action 0.0 0.0 0.0 0.00.0
Maximum power
plant capacity 0.0 0.0 0.0 0.00.0
High fluctuating
flow 0.0 0.0 0.0 0.00.0
Moderate
fluctuating flow 0.40 0.10 ~.10 0.00.40
Modified low
fluctuating flow 0.90 2.60 0.20 0.043.74
Interim low
fluctuating flow 1.00 2.70 0.20 0.043.94
Existing monthly
volume steady
flow 1.00 2.70 0.20 0.043.94
Seasonally
adjusted steady
flow 0.80 3.60 0.30 0.064.76
Year-round steady
flow 1.00 1.70 0.20 0.032.93
·The net economic benefits in each year were inflated by the projected gross national product
price deflatorforthatyear (Power Resources Committee, 1993) and were discounted using the
federal discount rate of 8.5 percent). The equivalent annual value was then calculated using
the same rate. SOURCE: BOR (1995~.
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133
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River Resource Management in the Grand Canyon
TABLE 7.3 Annual Values Associated with Alternative Dam Operations ($ millions)
Nonuse Values
Marketing
Power Recreation National Area
Moderate fluctuating flow 36.7 to 54.0 +0.4 +2,286.4 +62.2
Low fluctuating flow 15.1 to 44.2 +3.7 +3,375.2 +60.5
Seasonally adjusted -88.3 to -123.5 +4.8 +3,442.2 +81.4
steady flow
SOURCE: Adapted from Tables 7-1, 7-2, and 7-3 in Welsh et al., 1995; and as corrected in
Table 7-1 in Welsh, 1995.
marketing area. The national nonuse values, however, are about 30 times
larger than the foregone power revenues for seasonally adjusted steady
flows.
SUMMARY
Studies of recreation economics were designed and conducted using
state-of-the-art economic methodologies that are appropriate for the task of
measuring the economic impacts of EIS alternatives on recreationists. The
CVM was applied in a manner that maximizes the reliability of the recreational
value results. Surveys were extensively tested prior to being administered,
sample sizes were adequate, and statistical results were robust and
consistent with economic theory (Chestnut et al., 1991~.
It is important to keep in mind several issues when interpreting the
economic analysis of recreation. The analyses focused on the relationship
between recreational benefits and the immediate effect of river flows on the
quality of recreational experiences. For both the white-water rafters and
anglers, other long-term factors are related to the various alternatives and to
the quality of the recreational experience. For anglers the implications of
alternatives are very uncertain over the long term.
Factors such as the availability of camping beaches play a role in the
quality, and thus the net benefits, of rafting trips. The economic analyses,
however, focused on benefits associated with trips in which the number and
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Recreation and Nonuse Values
135
sizes of beaches were fixed, and so the recreational benefits underestimate
the long-term benefits associated with alternatives that would maintain larger
numbers or sizes of beaches (Chapter 5~.
The GCES nonuse value studies are one of the-most comprehensive
efforts to date to measure nonuse values and apply the results to policy
decisions. The studies were subject to extensive scrutiny by the interests
(agencies, advocacy groups) participating in GCES and also to intensive
review by a panel of professional economists with no stake in the outcome of
the studies. While the CVM was applied in a manner consistent with current
professional practice for measuring nonuse values, there is no objective
standard of benefits against which the CVM results can be compared. If there
were, the CVM exercise would not have been necessary. While not com-
pleted in time to be reported in the final EIS, the nonuse value results are an
important contribution of GCES and deserve full attention as decisions are
made regarding dam operations.
REFERENCES
Bishop, R. C., et al. 1987. Glen Canyon Dam Releases and Downstream
Recreation. GCES Technical Report, Bureau of Reclamation, Salt Lake
City.
Brown, C.A. and M.G. Hahn. 1987. Effect of flows in the Colorado River on
reported and observed boating accidents in Grand Canyon, Glen Canyon
Environmental Studies Technical Report. Bureau of Reclamation, Salt
Lake C ty, Utah.
Bureau of Reclamation. 1994. Operation of Glen Canyon Dam. Draft
Environmentallmpact Statement, U.S.Departmentofthelnterior,Wash-
ington, D.C.
Bureau of Reclamation. 1995. Operation of Glen Canyon Dam. Final
Environmental ImpactStatement, March, U.S. Departmentofthe Interior,
Washington, D.C.
Chestnut, L., R. Raucher, and R. Rowe. 1991. A Review of the Economic
Studies Conducted in Phase I of the Glen Canyon Environmental Studies.
Prepared for the Glen Canyon Environmental Studies by RCG/Hagler,
Bailly, Inc.
Harpman, D.A., M.P. Welsh, and R.C. Bishop. Nonuse Economic Value:
Emerging Policy Analysis Tool." Rivers 4 No. 4 (March 1995~:280-291.
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136
River Resource Management in the Grand Canyon
HBRS, Inc. 1991. Assessing the Potential for a Total Valuation Study of
Colorado River Resources. Final Report, prepared for the Glen Canyon
Environmental Studies by HBRS, Inc., Madison, Wisc.
HBRS, Inc. 1993. Analysis of the Impact of GCDEIS Alternatives on Rec-
reational Benefits Downstream from Glen Canyon Draft Report. Prepared
for the Glen Canyon Environmental Studies by HBRS, Inc., Madison,
wise.
Kearsley, L.H., and K. Warren. 1992. (1993 in EISJ River Campsites in Grand
Canyon National Park: Inventories and Effects of Discharge on Campsite
Size and Availability. Final report. Grand Canyon National Park Division
of Resource Management, National Park Service.
National Oceanic and Atmospheric Administration (NOM). 1993. Report of
NOM Panel on Contingent Valuation. U.S. Department of Commerce,
Washington D.C.
National Research Council. 1987. River and Dam Management: A Review of
the Bureau of Reclamation's Glen Canyon Environmental Studies.
Washington, D.C.: National Academy Press.
Power Resource Committee. 1993. Power Systems Impacts of Potential
Changes in Glen Canyon Power Plant Operations. Glen Canyon
Environmental Studies Technical Report, Stone and Webster Man-
agement Consultants, Inc., Englewood, CO.
Taylor, C., S. Winter, G. Alward, and E. Siverts. 1992. Micro IMPlAN User's
Guide. U.S. Department of Agriculture, Forest Service, Land Man-
agement Planning Systems Group, Fort Collins, Colorado.
U.S. Department of the Interior. 1991. Notice of proposed rulemaking:
Natural resource damage assessment. Federal Register 56~82J : 19752-
1 9773.
Welsh, M. 1995. Memorandum on corrections to the GCES Non-use Values
Study Draft Final Report, July 28. Prepared by Hagler Bailly Consulting,
Madison, Wisc.
Welsh, M.P., R.C. Bishop, M.L. Phillips, R.M. Baumgartner. 1995. GCES
Nonuse Value Study. Draft final report, prepared by RCG/Hagler Bailly,
Inc., Madison, Wisc. July 12.
Representative terms from entire chapter:
nonuse values
