1981 CO Drought Plan

• Title: The Colorado Drought Response Plan
• Date: 5/15/1981
• Description: Colorado Drought Response Plan
• Basin: Statewide
• Drought Mitigation - Doc Type: Complete Plan

Appendix 2to Economic Impacts #7, Annex C
The Use of Current Economic Models
in Predicting the Impacts of Drought
On April 22, 1981 a meeting was held of 12 individuals across
Colorado involved in economic modeling to look at the applicability
of current or "easily developed" models to predict the impacts of
drought.
The use of the Slater input/output (I/O) model (COLOSIM) during
the 1976-77 drought was first reviewed. It was agreed that the findings
of that $30,000 effort were essentially valid: the impacts of even a
prolonged (two year) drought would be negligible on the state economy
as a whole, but significant impacts would occur in specific sectors of
the economy and geographical areas. The focus of the April 22 meeting,
then, was to investigate models that could be used to estimate and pro-
ject these regional and sectoral impacts .
Reasonably good data is available at the state level , but regional
data is at best spotty. Several regional I/O models have been developed
by CSU using BLM and other funding sources for communities and regions
from the front range westward. An extensive modeling effort of the
region affected by the Ogalalla Aquifer is also currently under way.
These models have all required extensive collection of primary data.
Existing regional modeling is particularly weak in Colorado's eastern
plains and to a lesser extent in the south central and southwestern
portions of the state. It was estimated that it would take about
$150,000 per state planning region to develop regional models in those
areas. The need for such models lies in many areas besides projecting
the impacts of drought, but funding has been hard to come by.
If a serious drought occurs and funding is not available to develop
models for the most affected regions of the state, good rough estimates
could be made of the expected impacts on the agricultural and tourism
sectors of the economy based on existing agricultural production reports
and reports from the ski industry. Regarding the latter, the Division
of Employment has developed multipliers based on the experience of the
1976-77 drought that could be used to project the impact of declines in
the ski industry on other aspects of the economy. It was felt that in
the "first cut" the indirect effects of agriculture and tourism on
other sectors of Colorado' s economy could be ignored since, compared with
other states, our production is more oriented toward export out of the
state.
If funding was available, it may be possible to develop a model based
in part on the Palmer Drought Index or the modified version of that index
developed in 1981 by the Division of Water Resources . The following par-
tial list of individuals currently involved in economic modeling in
Colorado may be of use when the Drought Economic Impact Task Force is
activated.
C-7-4