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<br />greater than I% of the <br />regional economic activity.28,29 Further, the reported impacts are probably <br />overstated for the following reasons. <br />' First, the most aggressive estimates of the direct impacts were used. All of the reported direct <br />impacts are negative, although new information indicates a possibility for positive recreation <br />' impacts (fishing) on the San Juan River (see Schmidt and Stewart, 1996). Because of this <br />aggressive approach, the projected overall impacts due to the designation of critical habitat are <br />' biased toward being the largest they are likely to be. <br />' Second, the impacts are overstated due to the fact that this small region does not permit the <br />' complete reallocation of the resources that accompany the designation of critical habitat. <br />Expanding the region to encompass the physical extent of the river system allows for the <br />' possibility of inclusion of benefits which develop downstream as a result of flow protection <br />measures on the San Juan River. Specifically, the water placed in the San Juan River to provide <br />' habitat will flow into Lake Powell and be used downstream. In the original Colorado River <br />Basin study, water used to provide flows in the upper reaches of the river was ultimately put to <br />' consumptive use in several downstream states such as Nevada and California. Such uses will <br />offset the negative impacts that occur in the smaller region. <br />The impacts projected for the tribal economies represent a high and a low share of the overall <br />' reported impacts. The tribal share based on population overstates the likely tribal impacts due to <br />the fact that the employment ratio on tribal lands is lower than for the region as a whole. On the <br />1 <br />z8 By comparison, the output impacts in the original study constituted 0.028% of the total output of the state <br />of New Mexico over the study period. <br />"Over the period 1959-1991 the growth rate of the national economy varied from -2.2% to 6.2%. The mean <br />growth rate was 2.85%. Impacts that lie within this range are within the normal fluctuations of the economy and are <br />able to be absorbed by the economy. A conservative threshold for significant impacts would be a one percent deviation <br />' from the projected baseline (50 CFR 17). If changes in employment or output due to critical habitat exceed this <br />threshold, then that area of critical habitat should be considered for economic exclusion. <br /> <br />57 <br />