Using PES to Improve Ecosystem Health and Forest Cover in the SFRR Watershed “Forests to Faucets (F2F) Initiative” Michael Collins, AICP Executive Director Conserv : Marketplace for Ecosystem Restoration February 18, 2010

Forests to Faucets Goal The project will link the financial interests of landowners in the reservoir watershed and their forestland management practices to urban consumers of the municipal water supply.

Kickoff Objectives Acquaint participants with: –Ecosystem Services –Need for Initiative –F2F Initiative –F2F Advisory Council and Committees Discuss Council and Committee administration Discuss next steps Set next meeting

Need for Initiative 2003 South Fork Rivanna Reservoir and Watershed – Reflecting on 36 Years, Anticipating 50 Years –Sedimentation: Maximize forest throughout watershed –Nutrients: Maximize forest throughout the watershed

Need cont’d Resilience: –Maximize forest throughout the watershed –Minimize fragmentation of the land and conversion of land to residential/commercial land use –Encourage farming practices that minimize impact to water quality

Resilience – What is it? “Ecosystems, including watersheds, have natural characteristics that confer a degree of protection to the ecosystem and those who rely on it. These protective characteristics sometimes are referred to as “resilience.” The logic is similar to the idea that general good health in people provides them protection from illness.” “

Source of SFRR Resilience “The most important and obvious source of resilience in the SFRR Watershed ecosystem is natural forest. Forests produce the cleanest flow of water possible.”

SFRR F2F Initiative Initiative Hypotheses Initiative Objectives Initiative Timeline

Forests to Faucets Initiative Hypotheses Data and models: –exist to link SFRR watershed resilience to reservoir health –exist to link land management practices to SFRR reservoir health –exist to link willingness to employ practices to voluntary payments –exist to link the cost of payments to fees generated by a water utility

Hypotheses cont’d There are stewardship practices that can effectively improve watershed resilience Optimum theoretical improvement in watershed resilience is a consequential percentage of optimum theoretical health of the reservoir A payment threshold exists that causes a landowner to engage in effective resilience practices Per unit total voluntary payments available for watershed resilience can be determined

The Critical Hypothesis The cost to the utility for portion of these payments urban consumers are willing to pay is less than the cost of treatment (to urban consumers) of reservoir sickness

F2F Major Objectives 1.Create F2F Advisory Council 2.Develop PES Protocols 3.Create Priority Areas Methodology and Map 4.Create Landowners Screening Methodology and Screen Landowners 5.Create an F2F Marketing Plan and advertise the initiative

F2F Objectives cont’d 6.Create a Watershed Health Index (WHI) and model pre- and post-project conditions 7.Develop a Cost Benefit Analysis methodology and prepare analysis

F2F Advisory Council Notion – possible implementation of project findings would necessarily involve parties beyond VDOF and Conserv. Therefore – these stakeholders along with other interested parties should be provided an avenue to advise VDOF and Conserv on project decisions.

PES Protocols Eligible practices for payments Payment methodology Payment amounts

Priority Areas Methodology and Map Spatial PES prioritization methodology Based on biophysical conditions (geology, soils, slopes, land cover) and land management conditions Identify areas/parcels that provide the greatest resilience/water quality benefit for dollar spent

Eligible Landowner Screening Reactive –EQUIP eligible –Sensitivity to annual payments –General interest ecosystem services markets –Willingness to transfer forest management responsibilities at sale of property Proactive –Search for eligible landowners through initiative marketing

Create marketing plan and advertise initiative Workshops Newsletters Media interviews Articles

Create a Watershed Health Index (WHI) and model pre and post conditions Purpose is to model watershed health before and after initiative Methodology consistent with Rapid Watershed Assessment (RWA)

Cost Benefit Analysis Create methodology Prepare analysis

F2F Advisory Council Administration Council as a whole would rarely meet 3 year life Beginning of initiative and at the end 3 Committees convening mostly during first year –Watershed Resilience/Health –PES Protocols –Cost-Benefit/Benefit Transfer Analysis –Convening approximately once per month

Suggested F2F Council Operational Structure Chair Facilitator Recorder Decision-making process: consensus

Suggested F2F Committee Operational Structure Chair Facilitator Recorder Decision-making process: consensus

Next Steps Convene F2F Council –Identify F2F Council Chair –Prepare 3 year workplan/schedule –Identify Committee participants Convene committees in February/March –Prepare 3 year workplan/schedule