Quantifying Economic Tradeoffs and Values for Northeast Coastal Adaptation: Interim Results from

Waterford and Old Saybrook, Connecticut

Presented at the 2013 Northeast Regional Sea Grant Meeting, New Bedford, MA. November 18-20.

Robert J. JohnstonClark University

Adam WhelchelThe Nature Conservancy

Christos MakriyannisClark University

Project Overview

Ongoing project evaluates how Northeast communities can best adapt to vulnerabilities related to coastal storms and flooding.

Seeks to quantify economic benefits realized by communities under alternative adaptation scenarios. Reflected in residents’ values for outcomes and

tradeoffs. Gives particular attention between tradeoffs among the

outcomes of hard and soft adaptation and implications for adaptation values.

This presentation provides an update on interim project results in Waterford and Old Saybrook, Connecticut.

The Context for Adaptation

Northeast coastal communities are facing increasing threats from coastal storms and flooding.

Strategies to address these challenges involve tradeoffs among development, ecosystem services, community character, direct/indirect costs and other outcomes. e.g., marsh transgression versus coastal development

These tradeoffs are magnified in communities with heavily developed and highly vulnerable waterfronts.

These tradeoffs also involve coupled biophysical and socioeconomic dimensions.

Integrated approaches are required.

Local versus Regional Patterns

A challenge to developing regionally applicable methods is heterogeneity in vulnerabilities and tradeoffs across different areas.

Certain patterns are common across Northeast coastal communities (e.g., threats to coastal homes).

Other patterns vary widely (e.g., prevalence and vulnerability of marshes, beaches and critical facilities).

An initial focus on two distinct yet geographically proximate communities (Old Saybrook and Waterford, CT) provides an opportunity to quantify key differences within a parallel framework.

Methods are designed for transferability.

Different Waterfronts and Vulnerabilities

Biophysical / Economic Framework

Initial qualitative methods (focus groups and expert interviews) used to develop conceptual model of vulnerabilities and tradeoffs.

Biophysical data underlying Nature Conservancy’s Coastal Resilience tool characterizes scenarios. Provides data on attributes, vulnerabilities and potential

changes. Choice modeling quantifies households’ economic values

and tradeoffs associated with these biophysical changes. The goal is to identify biophysically feasible adaptation

options that increase community benefits, and to estimate the influence of uncertainty on residents’ values.

Stated Preference Choice Models

To evaluate economic values and tradeoffs we apply carefully-designed stated preference choice models.

Choice models are survey-based methods that estimate values from respondents’ choices over alternative, hypothetical policy options.

Grounded in economic randomutility theory.

Stated Preference Choice Models

Choice modeling questions mimic public votes. Respondents choose among policies with different environmental effects and costs.

By evaluating respondents’ choices over many different multi-attribute alternatives, we can calculate their willingness to make tradeoffs.

These observed tradeoffs revealeconomic values.

Enables identification of thebiophysically possible adaptationscenarios that maximizeresidents’ expected benefits.

Initial Focus Groups and Interviews

NESG funds did not arrive at Clark until September 2012. IRB approval for focus groups obtained September 27. Initial focus groups / meetings from October 2012 to

January 2013. Meetings with experts and policymakers. Focus groups with residents and stakeholders.

Results combined with biophysical data from Coastal Resilience to develop conceptual models and identify key tradeoffs.

Primary Resources and Tradeoffs

A set of central attributes were repeatedly identified in focus groups and interviews as relevant to community welfare (benefits of adaptation). Homes vulnerable or lost (at different levels of risk). Loss/gain of natural habitats such as tidal marshes. Loss/gain of recreational resources such as beaches. Extent of coastal armoring Cost (e.g., to taxpayers). Uncertainty

Less frequently noted were effects on transportation, municipal facilities, freshwater resources and other outcomes.

Linking Economic Models with Existing Biophysical Data

Future scenarios modeled within Coastal Resilience were used to characterize baseline outcomes for these attributes. Establishes status quo for choice modeling. 2020s chosen as the time period best suited to illustrate

future policy impacts. Coastal Resilience, scientific literature and expert input

used to characterize a range of possible future outcomes. D-efficient experimental design mixes and matches these

outcomes to create choice scenarios (voting questions). Provides maximum statistical “information” per survey.

Extensive testing of resulting choice scenarios and surveys is crucial for validity and to interpret results.

Draft Survey Design (selected pages)

Draft Survey Design

Draft Survey Design

Evaluating Risk Perceptions

Two Distinct Survey Versions(to assess the impact of uncertainty)

Pretest Focus Groups

Second round of focus groups is now underway to pretest and revise survey instrument.

Surveys will also be reviewed by stakeholders, town planners, elected officials, etc.

Extensive pretesting required toensure that respondents understandand answer questions in a way thatcorresponds to underlying economic model and revealsvalues.

Some Preliminary Qualitative Findings

Respondents understand the tradeoffs in coastal adaptation and are able to make informed choices that reveal values.

There is substantial heterogeneity in values related to the neighborhoods in which people live.

Residents appear to have lower values for protecting coastal homes and higher values for habitat protection than is typically assumed.

Residents almost universally consider additional armoring to be a negative outcome, ceteris paribus. Among the key concerns is the impact on community character.

Many respondents favor the (compensated) removal of repeatedly damaged homes and are not opposed to coastal retreat.

Some Preliminary Qualitative Findings

The values of typical residents differ markedly from the vocal minority (typically waterfront homeowners).

Elected officials and planners appear to have some misperceptions about residents’ values.

This highlights the value of social science assessments which characterize representative values.

More work is required to finalize the survey (and biophysical data) and address a few areas of remaining confusion among potential respondents.

Challenge—providing sufficient information for respondents to make informed choices within a survey of reasonable length and complexity.

Upcoming Tasks and Progress

A no-cost extension will be required to complete project tasks.

Survey pretests will continue through January 2014. Final survey review, experimental design and sampling

plans to be completed during February – April 2014. Printing and preparing survey packages will occur during

May – June 2014. Survey to be implemented during July – August 2014. Data analysis and community workshops will occur

during fall 2014.

Questions or Comments?

Robert J. JohnstonDirector, George Perkins Marsh InstituteProfessor, Department of EconomicsClark University950 Main St.Worcester, MA 01610Phone: (508) 751-4619Email: rjohnston@clarku.edu