1. Comprehensive Benefit Analysis of the Chesapeake Bay TMDL Presented by Elena Besedin

2. Abt Associates | pg 2 Comprehensive Benefit Analysis of the Chesapeake Bay TMDL BMP Effects Direct Effects  Nutrient load  Sediment Load Direct Effects  Nutrient load  Sediment Load Indirect Effects  Air pollutant release  Vegetation/open space Hydrology Indirect Effects  Air pollutant release  Vegetation/open space Hydrology Models Water Quality Aquatic Ecosystem Fisheries Model Models Water Quality Aquatic Ecosystem Fisheries Model Models Vegetation effects on air Hydrological Models Flood risk models Human health risk Models Vegetation effects on air Hydrological Models Flood risk models Human health risk Monetization approaches

3. Abt Associates | pg 3 Benefits of the Chesapeake Bay TMDL: Previous Analyses  Benefit categories included in previous analyses (M. Cropper and W. Isaac, 2011) –Commercial fishing –Water-based recreation (fishing, swimming, boating –Property values –Nonuse values  Ancillary benefit categories (EPA/ORD) –Carbon sequestration –Air pollutant removal (screening level)

4. Abt Associates | pg 4 Comprehensive Analysis of the Chesapeake Bay TMDL  Including additional benefit categories –Modeling additional ecological effects and ecosystem services provided by Chesapeake Bay and BMPs to reduce nutrient loadings beyond those accounted for in previous analyses  Modeling additional market effects  Estimating potential employment effects  Including additional services and other economic effects in benefit-cost analysis –Accounting for costs and benefits based on TMDL implementation timeline Phased controls: 60% of actions by 2017; 100% by 2025 Potential to evaluate costs and benefits over implementation timeline –Potential for optimization of BMPs accounting for additional ecosystem service benefits

5. Abt Associates | pg 5 Direct TMDL Effects: Nutrient and Sediment Load Reductions Nutrient reductions impacts:  Reduced Algal Blooms –Increased nutrient retention, benthic infauna, community composition, increased oxygen availability, increased water clarity and light transmission  Increased Oxygen Availability –Direct effects on frequency of hypoxic events, macroinfaunal diversity and biomass, increased bivalve populations and filtration rates, nutrient cycling, fisheries productivity  Decreased Acidification –Population and growth effects of major calcifiers, altered vital rates, community composition  Nutrients  Algae  Turbidity O2O2 O2O2  Light  Benthic Production  Redox  Nitrification  Uptake  Suspension  Nutrient Recycling

6. Abt Associates | pg 6 Direct TMDL Effects: Nutrient and Sediment Load Reductions Sediment reductions improve many factors:  Increased Water Clarity –Direct effects on benthic primary production, macroinfaunal diversity and biomass, shift in relative importance of demersal (increase) and pelagic (decrease) food webs  Increased Submerged Aquatic Vegetation (SAV) Area –Positive feedback with particle trapping and sediment binding, reduced efflux of sediment nutrients, increased nutrient assimilation, increased oxygen production  Nutrients  Algae  Turbidity O2O2 O2O2  Light  Benthic Production  Redox  Nitrification  Uptake  Suspension  Nutrient Recycling

7. Abt Associates | pg 7 Indirect TMDL Effects Example BMPs  Land Management –Agricultural land retirement –Tree planting –Forest buffers –Grass buffers  Natural area restoration –Wetland restoration –Stream restoration  Agriculture –Erosion control (buffer zones) –Animal waste management  Urban Stormwater Management –  in impervious cover Non-Water Quality Effects  Land –  in open space / vegetated areas –  in the number of trees –  in riparian habitat / wetlands  Hydrology –  in on-site water storage –  in groundwater recharge –  in flood risk –stream channel protection  Air effects –  reduced ammonia releases –air pollutant removal by vegetation –  in temperature extremes

8. Abt Associates | pg 8 Identifying and Evaluating Ecosystem Services Ecosystem Service Category Water Quality ChangesAncillary BMP Services Provisioning Habitat for fish/shellfish consumed by humans Drinking water supply Agricultural and industrial water supply Navigation Riparian/terrestrial habitat for fish and game consumed by humans Provision of wood and other forest products Drinking water supply (groundwater) CulturalWater-based Recreation Swimming Fishing Hunting Boating Near water activities Aesthetic (water clarity/color) Property values Scenic vistas Nonuse Habitat preserving aquatic biodiversity Land and Near Water Recreation Fishing and shellfishing Hunting (waterfowl and game) Birding Hiking/nature enjoyment Aesthetic (landscape effects) Property values Scenic vistas Education Wetlands/forest education centers Nonuse Habitat preserving wildlife and plant biodiversity

9. Abt Associates | pg 9 Identifying and Evaluating Ecosystem Services (continued) Ecosystem Service Category Water Quality ChangesAncillary BMP Services Regulating Nutrient cycling Primary production Hypoxia events Ecosystem resilience pH Water Clarity Air Air pollutant releases (ammonia) Air pollutant removal by vegetation Carbon storage Reduction in air temperature volatility Soil Erosion control Sediment retention Hydrology Flood control Stream bank stabilization Stream channel protection Groundwater recharge Water Quality Filtration/Nutrient removal (groundwater) Reduction in stream temperature volatility

10. Abt Associates | pg 10 Bringing the Pieces Together: Example Framework for Estimating TMDL Benefits Simplified representation showing only selected components of the analysis.

11. Abt Associates | pg 11 Effects of Increased Vegetation: i-Tree Model, US Forestry Service  i-Tree is a peer-reviewed model developed by the USFS –Estimates services from trees and shrubs –Use field data or GIS layers for tree canopy and impervious surface  Air Pollution Removal (PM 10, PM 2.5, NO 2, SO 2, CO, O 3 ) –Pollution removal per unit of tree canopy based on local conditions –Can be converted to changes in concentrations  Carbon Sequestration and Storage –Sequestration and storage per unit of tree canopy  Energy Savings –Shading and windbreak savings based on tree placement  Can be supplemented with data for other vegetation types

12. Abt Associates | pg 12 Human Health Effects from Reduced Air Pollution (Example) $ Monetary Value of Health Effects$ For each subgroup and baseline and post- regulation: Pollutant exposure distribution Adverse health effects distribution For each subgroup and baseline and post- regulation: Pollutant exposure distribution Adverse health effects distribution Population Distribution by Age and Presence of Sensitive Subgroups BenMap (EPA_OAQPS)

13. Abt Associates | pg 13 Flood Analysis Approach (Example)  SWAT: Soil and Water Assessment Tool developed by USDA  HAZUS-MH: Hazards U.S. Multi-Hazard (HAZUS-MH) Tool developed by FEMA  NFRST: National Flood Risk Screening Tool developed by Abt Associates $

14. Abt Associates | pg 14 Market-based Approaches  Water Quality –Commercial fish/shellfish harvest –Drinking water treatment –Reservoir dredging –Navigational waterways dredging –Agricultural/industrial water supply  Air –Electricity savings –Technology alternatives to carbon sequestration –Technology alternatives to air pollutant removal  Employment Effects  Regional Economic Impacts –Input output models  Hydrological Benefits –Flood damages –Groundwater quantity –Drinking water treatment (groundwater) –Avoided cost of infrastructure maintenance and expansion – Avoided cost of stream restoration –Water storage for beneficial use

15. Abt Associates | pg 15 Nonmarket Valuation Water Quality  Water-based recreation –Recreational demand models –Stated preference (SP) studies –Hedonic studies  Human health (e.g., exposure to pathogens in shellfish, drinking water or while swimming) –Cost of illness –SP studies –Averting behavior  Aesthetic –Hedonic property –SP studies –Recreational demand  Nonuse values (aquatic life support, biodiversity, overall ecosystem health and resilience) –Stated preference studies Landscape  Land (including wetlands) –Land-based recreation Recreational demand models SP studies Hedonic studies –Aesthetic Hedonic property SP studies Recreational demand –Nonuse (wildlife habitat, biodiversity) SP studies

16. Abt Associates | pg 16 Nonmarket valuation Air  Human health –Exposure to criteria pollutants (mortality and morbidity) Cost of illness Stated preference studies (BT) –Exposure to extreme temperature (mortality) SP studies  Carbon sequestration Social Cost of Carbon (SCC) Hydrology  Flooding (value of reduced flood risk) –SP studies –Hedonic property models  Groundwater protection –SP studies –Averting behavior  Stream channel protection –SP studies –Hedonic property models

17. Abt Associates | pg 17 Value of Ancillary Services from Urban BMPs for Chesapeake Bay Watershed EPA/ORD analysis, 2011

18. Abt Associates | pg 18 Example Cost-Effectiveness of BMPs with and without Ancillary Benefits

19. Abt Associates | pg 19 Challenges, Gaps, Overlaps  Quantification –Lack of data or models to estimate ecological improvements (e.g., ecosystem resilience, stream channel stabilization) –Some beneficial effects are omitted from the water quality modeling step (e.g., pathogens) –Timeline for TMDL implementation  Monetization –Linking ecological and economic endpoints –Selecting ecological metrics that provide an accurate representation of ecosystem change Measurable Comprehensive Interpretable Applicable –Potential overlapping and double counting of benefits Property value change vs. recreational benefits Property value change from improved landscape vs. water quality –Capturing multi-media effects  Selecting an optimal set of BMPs: cost-benefit optimization framework