ARCA 2015 Annual Meeting Exhibits

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14 Aa The Economic Importance of Water in Kansas CONCLUSIONS & RECOMMENDATIONS The purpose of this study is to calculate the economic importance of water availability to the State of Kansas. Based on an assumption of constrained water availability in five of seven study areas in CY2062 estimated by GMD3 under normal climatic water supply conditions, a customized IMPLAN input-output model is used to estimate Gross State Product (GSP), employment, and labor income losses in CY2062.13 Central to this analysis are two additional assumptions: • The non-substitutability of water to compensate for the estimated loss of water availability in Areas 1-5; and • The non-adaptability of producers and consumers to this estimated water loss. Conclusions The direct losses for the State of Kansas economy if GMD3's estimated reduction in total water availability in the seven areas of study holds true in CY2062 are estimated at$12.3 billion GSP,approximately 158,000 jobs, and$6.29 billion labor income(2015$). The indirect losses sustained by the State of Kansas economy if GMD3's estimated reduction in total water availability in the seven areas of study holds true in CY2062 are estimated at $3 billion GSP, over 35,000 jobs, and$1.4 billion labor income (2015$). The induced losses sustained by the State of Kansas economy if GMD3's estimated reduction in total water availability in the seven areas of study holds true in CY2062 are estimated at$3 billion GSP,approximately 48,000 jobs, and $1.7 billion labor income (2015$). The total impact of GMD3's estimated reduction in total water availability in the seven areas of study in CY2062 for the State of Kansas economy is estimated at$18.3 billion GSP, almost 241,000 jobs, and $9.4 billion labor income (2015 $). This equates to an estimated 10.1% loss for the State of Kansas' GSP in CY2062. Area 3, which consists of Finney, Ford, Grant, Gray, Hamilton, Haskell, Kearny, Meade, Morton, Seward, Stanton, and Stevens counties, is estimated to potentially suffer the greatest economic losses in absolute terms due to GMD3's projected shortfall in water availability in CY2062. Area 3's total economic losses are estimated at$10.4 billion GSP, approximately 124,000 jobs, and$5.3 billion labor income (2015$). Area 2,which consists of Greeley, Lane, Scott, Wallace, and Wichita counties, is estimated to potentially suffer the greatest economic losses in percentage terms due to GMD3's shortfall in water availability in 13 Apparet Analytics recognizes that the non-substitutability and non-adaptability assumptions are unlikely. However, it is the best way to arrive at a comprehensive estimate of the economic importance of water for State of Kansas economy. 13 Apparet Analytics 2015