9391

• UCREFRP Catalog Number: 9391
• Author: Watts, G., W. R. Noonan, H. R. Maddux and D. S. Brookshire.
• Title: The Endangered Species Act and Critical Habitat Designation
• USFW Year: 1997.
• USFW - Doc Type: An Integrated Biological and Economic Approach.
• Copyright Material: NO

levels, and land may not be developed for housing so that habitat for plant species is
preserved. However, by not harvesting trees or building houses, recreational uses may be
enhanced and setting aside minimum stream flows in one area may imply that more water is
available for development elsewhere. Assessing the economic impacts of designating critical
habitat thus requires a general equilibrium analysis to fully capture the range of potential
activities created by the designation as well as the range of activities that are eliminated or
reduced. In short, the reallocation will yield economic impacts that are benefits as well as
costs .

This paper reports the methodology and results from a study that measured the economic
impacts of designating critical habitat for four endangered fishes along a 2,200 mile stretch of
the Colon.do River and its major tributaries. A second case study covering two fishes and 160
miles of the Virgin River in Nevada and Utah is also discussed. The two case studies analyze
the impacts of critical habitat designation on two regions greatly differing in size. For the
Colorado study, designation affects all seven states in the Colorado river basin: Arizona,
California, Colorado. Nevada, New Mexico. Utah and Wyoming. The critical habitat analyzed in
the Virgin study covers a river flowing through three counties in Arizona, Nevada, and Utah. In
both cases, the study region was determined on the basis of habitat needs and direct economic
impacts.

Two study regions differ considerably in the sizes of their economies. The output of the region
in the Colorado study is approximately $1.3 trillion annually, compared to $28 billion for the
Virgin study region. The Colorado study region constitutes a diversified economy that has
experienced growth above the national average during the last several decades. The region of the
Virgin study is currently one of the fastest growing areas in the United States, with continued
high population growth rates projected for the time horizon of the study. The time horizons of
the studies coincide with the time span of the proposed recovery plans for the species: 1995 to
2020 in the Colorado study, and 1995 to 2040 in the Virgin study. The major characteristics of
the two studies are summarized in Table 1.

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