The Clean Water Act of 1972 protects the "waters of the United States" from unpermitted discharges that may harm water quality for humans and aquatic life. Time of day controls are a cubic polynomial in hour of day. Effects of Clean Water Act Grants on Log Mean Home Values: Event Study Graphs. The federal government paid 75% of the capital cost for most construction projects awarded through September 1984, and 55% thereafter; local governments paid the rest of the capital costs. Many travel demand papers use small surveys that report distance traveled to a specific lake or for a narrow region. Connected dots show yearly values, dashed lines show 95% confidence interval, and 1962 is the reference category. Graphs show coefficients on downstream times year-since-grant indicators from regressions which correspond to the specification of TableII. Each of the four pollutants which are part of these fishable and swimmable definitions declined rapidly during this period. Online Appendix TableVII investigates heterogeneity in measured benefits and costs; Online Appendix E.3 discusses the results. Lack civil or criminal penalties for violations. Benefits and Costs of the Clean Air Act | US EPA Pros of legalism are There were much fewer crimes in china and the laws. TableIII presents estimates of cost-effectiveness. Column (2) uses real dollars. Implemented in response to growing public awareness and concern for controlling water pollution in the U.S., the Clean Water Act followed the establishment of the Environmental Protection Agency (EPA) and the passage of the Clean Air Act in 1970, and preceded the Endangered Species Act of 1973, making it part of a period of landmark . A third question involves substitution. Propensity score for appearing in the balanced panel of cities is estimated as a function of log city population, log city total municipal expenditure, city type (municipality or township), and census division fixed effects, where city population and expenditure are averaged over all years of the data. Clean Air Act Essays | ipl.org Leads decrease of about 10% a year may be related to air pollution regulations, such as prohibiting leaded gasoline. We find that by most measures, U.S. water pollution has declined since 1972, though some evidence suggests it may have declined at a faster rate before 1972. Notes. The usage of water ranges from basic household needs to agricultural purposes. The 0.25- or 1.0-mile estimates are slightly larger, which is consistent with the idea that residents nearer to the river benefit more from water quality. The Clean Water Act and Water Pollution, VI. Focus on balancing cost and health . Data include balanced panel of cities over 19702001, see text for details. 5 Things To Know About NY's Clean Water, Air, And Green Jobs Bond Act We find large declines in most pollutants that the Clean Water Act targeted. Because most grants were given in the 1970s, we observe water pollution up to 10years before and 1525years after most grants. But because residents who live upstream of treatment plants can benefit from clean water downstream of treatment plants (e.g., by traveling for recreation), upstream homes could benefit from grants. Clean Water Act Cons - 679 Words | Bartleby EPA has also developed national water quality criteria recommendations for pollutants in surface waters. A few points are worth noting. The grants we study actually subsidize the adoption of pollution control equipment, which is a common policy that has undergone little empirical economic analysis. How the Clean Water Act Protects Your Rivers - American Rivers They suggest similar conclusions as Panels A and B. Open Document. Q_{icy}=\alpha y_{y}+X_{icy}^{^{\,\,\prime }}\beta +\delta _{i}+\epsilon _{icy}. From Exxon to BP: Has Some Number Become Better than No Number? Wetlands, Flooding, and the Clean Water Act - Resources for the Future Column (1) includes only plants analyzed in column (2) of TableII. Shapiro thanks fellowships from the EPA, MIT-BP, Martin Family Fellows, the Schultz Fund, the Yale Program on Applied Policy, and NSF Grant SES-1530494 for generous support. Environmental Bill: The Pros and Cons - The New York Times Panel C estimates the effect of grants on log housing units and Panel D on the log of the total value of the housing stock. Q_{icy}=\sum _{\tau =1963}^{\tau =2001}\alpha _{\tau }1[y_{y}=\tau ]+X_{icy}^{^{\,\,\prime }}\beta +\delta _{i}+\epsilon _{icy}. This predictable spatial variation in the net benefits of water quality variation suggests that allowing the stringency of regulation to vary over space may give it greater net benefits (Muller and Mendelsohn 2009; Fowlie and Muller forthcoming). All You Need to Know About The Clean Water Act & Its Amendments Row 4 is calculated following the method described in Online Appendix B.4. Analyses of the Clean Air Act relying solely on hedonic estimates generally have smaller cost-benefit ratios; the EPAs benefit numbers for air pollution rely heavily on estimated mortality impacts. International Spillovers and Water Quality in Rivers: Do Countries Free Ride? pH increased by 0.007pH units a year, meaning that waters became more basic (less acidic). Ninety-five percent confidence regions are in brackets. The statistic we use reflects the binary cutoff of whether a majority of readings are fishable. [1] It is one of the United States' first and most influential modern environmental laws, and one of the most comprehensive air quality laws in the world. The National Survey of Recreation and the Environment and its predecessor, the National Recreation Survey, do not systematically summarize trips taken and travel distances. N1 - Macroeconomics and Monetary Economics; Industrial Structure; Growth; N3 - Labor and Consumers, Demography, Education, Health, Welfare, Income, Wealth, Religion, and, N4 - Government, War, Law, International Relations, and, N5 - Agriculture, Natural Resources, Environment, and Extractive, N7 - Transport, Trade, Energy, Technology, and Other, O - Economic Development, Innovation, Technological Change, and, O3 - Innovation; Research and Development; Technological Change; Intellectual Property, Q - Agricultural and Natural Resource Economics; Environmental and Ecological, R - Urban, Rural, Regional, Real Estate, and Transportation, R3 - Real Estate Markets, Spatial Production Analysis, and Firm, Z1 - Cultural Economics; Economic Sociology; Economic, II. A .gov website belongs to an official government organization in the United States. A second general equilibrium channel is that the hedonic price function may have shifted. Moreover, the share of industrial water discharge that was treated by some abatement technology grew substantially in the 1960s (U.S. Census Bureau 1971). Clean Water Act Cons. The curve 1 describes the offer function of a firm, and 2 of another firm. Column (4) reweights estimates using the inverse of the estimated propensity score for inclusion in the balanced panel of cities. Each grant decreases dissolved oxygen deficits by 0.7 percentage points, and decreases the probability that downstream waters are not fishable by 0.7 percentage points. However, it leaves it up to EPA. These comparisons also highlight features of the Clean Water Act that are not widely recognized and could lead it to have lower net benefits than some other environmental regulation. Its mission is to improve environmental, energy, and natural resource decisions through impartial economic research and policy engagement. Other possible general equilibrium channels describe reasons the effects of cleaning up an entire river system could differ from summing up the effects of site-specific cleanups. E[G_{py}d_{d}\cdot \epsilon _{dpy}|X_{pdy}^{^{\,\,\prime }},\eta _{pd},\eta _{py},\eta _{dwy}]=0. Pass-through of Grants to Municipal Sewerage Capital Spending. Online Appendix TableIII shows these results and Online Appendix E.1 explains each. River miles * pct. Our topic is clean water and sanitation. Notably, almost half of this decline in state and local wastewater treatment capital spending occurred before the Clean Water Act. Summary of the Clean Water Act | US EPA Calculations include grants given in 19622000. Has Surface Water Quality Improved since the Clean Water Act? Clean Water, Clean Air, and Green Jobs Environmental Bond Act of 2022 The basis of the CWA was enacted in 1948 and was called the Federal Water Pollution Control Act, but the Act was significantly . Another possible channel involves ecology. *The Clean Water Program, which calls for $790 million for municipal-treatment improvements, nonpoint-source-control projects, aquatic-habitat restoration and implementation of management plans. This assumption could also fail if changes in governments effectiveness at receiving grants are correlated with governments effectiveness at operating treatment plants. Effects of Clean Water Act Grants on Housing Demand. 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Independent evidence is generally consistent with this idea. Standard errors are clustered by watershed. Incomplete information would be especially important if pollution abatement improves health. JavaScript appears to be disabled on this computer. This early version of the CWA left sanitation planning up to the surgeon general, and allowed the Federal Works Administration to help local and state governments with prevention and cleanup efforts. One involves declining returns to abatement of pollution from point sources. At the same time, much oxygen-demanding pollution comes from agriculture and other nonpoint sources, and those sources have remained largely unregulated. The health of many aquatic species (so indirectly, the benefit people derive from a river) may depend nonlinearly on the area of clean water. The 1972 U.S. Clean Water Act sought "to restore and maintain the chemical, physical, and biological integrity of the Nation's waters." This article quantifies changes in water pollution since before 1972, studies the causes of any changes, and analyzes the welfare consequences of any changes. 1974 Report to the Congress. Clean Water Act Grants and Water Pollution, Steinwender, Gundacker, and Wittmann 2008, Muehlenbachs, Spiller, and Timmins (2015), U.S. Government Accountability Office 1994, https://ofmpub.epa.gov/waters10/attains_nation_cy.control, https://academic.oup.com/journals/pages/open_access/funder_policies/chorus/standard_publication_model, Receive exclusive offers and updates from Oxford Academic, 6. A review of 10 U.S. studies found pass-through estimates between 0.25 and 1.06 (Hines and Thaler 1995). Dissolved oxygen deficit equals 100 minus dissolved oxygen saturation, measured in percentage points. 2001; Steinwender, Gundacker, and Wittmann 2008; Artell, Ahtiainen, and Pouta 2013). The map in Online Appendix FigureVIII shows heterogeneity in the ratio of measured benefits to costs across U.S. counties. Sample size in all regressions is 6,336. As in most event study analyses, only a subset of event study indicators are observed for all grants. Hence our preferred housing estimates come from difference-in-differences regressions analyzing homes within a 25-mile radius of river segments that are downstream of treatment plants. These estimates are even less positive than the estimates for housing. Most others are statistically indistinguishable from the mean grant, though there is some moderate (if statistically insignificant) heterogeneity in point estimates. The Author(s) 2018. In Panel B, the year variables are recentered around 1972. Pros And Cons Of The Clean Water Act - 329 Words | Cram Research does find statistically significant but imperfect correlation between perceived local water pollution and objectively measured local water pollution (Faulkner etal. The ultimate entity responsible for local capital costs and operation and maintenance costs is ambiguous because local governments may receive other payments from state or federal governments to help cover these costs. The Clean Water Act was passed by a bi-partisan vote in the early 1970s after decades of Congress trying unsuccessfully to get the states to clean up pollution in our nation's waterways. The cost-effectiveness is defined as the annual public expenditure required to decrease dissolved oxygen deficits in a river-mile by 10 percentage points or to make a river-mile fishable. Land Rents, Local Productivity, and the Total Value of Amenities, Watersheds in Child Mortality: The Role of Effective Water and Sewerage Infrastructure, 1880 to 1920, Failure to Act: The Economic Impact of Current Investment Trends in Water and Wastewater Treatment Infrastructure, Mostly Harmless Econometrics: An Empiricists Companion, Subjective vs. The basis of the CWA was enacted in 1948 and was called the Federal Water Pollution Control Act, but the Act was significantly reorganized and expanded in 1972. In 1969 Ohio's Cuyahoga River was so fouled by industrial pollution that the river caught on fire. Column (4) implies that each grant increases mean home values within 25 miles of affected waters by 0.024 percentage point. Fourth, to obtain regression estimates for the average housing unit and provide an efficient response to heteroskedasticity, we include GLS weights proportional to the number of total housing units in the plant-year observation and to the sampling probability.17. TableVI separately lists three types of costs: federal expenditures on capital, local expenditures on capital, and operation and maintenance costs. We also observe that each additional grant results in further decreases in pollution (Online Appendix TableVI), which would be a complicated story for the timing of government human capital to explain. This analysis, however, is subject to serious concerns about use and nonuse estimates in the underlying studies. Fecal coliforms had the fastest rate of decrease, at 2.5% a year. The Clean Air Act: Successes and Challenges Since 1970 The Clean Water Act, by contrast, mostly ignores nonpoint pollution sources like agriculture. Advantages and Disadvantages of Water Quality Data Submission Tools These estimates divide treatment plants into 10 deciles of the number of housing units in 2000 within 25 miles of downstream river segments. Keiser thanks the USDA for funding through the National Institute of Food and Agriculture Hatch project number IOW03909. Objective versus Subjective Assessments of Environmental Quality of Standing and Running Waters in a Large City, 1967 Census of Manufactures: Water Use in Manufacturing, National Water Quality Inventory. The gradual effect of the grants is unsurprising since, as mentioned earlier, the EPA estimates that it took 2 to 10 years after a grant was received for construction to finish. Adding rental units in column (3) barely changes this estimate. When Subsidies for Pollution Abatement Increase Total Emissions, Water Quality and Economics: Willingness to Pay, Efficiency, Cost-effectiveness, and New Research Frontiers, Handbook on the Economics of Natural Resources, Evidence of the Effects of Water Quality on Residential Land Prices, Decentralization and Pollution Spillovers: Evidence from the Re-drawing of County Borders in Brazil, Taxation with Representation: Intergovernmental Grants in a Plebiscite Democracy, An Economic Analysis of Clean Water Act Issues, Contingent Valuation of Environmental Goods, A Symphonic Approach to Water Management: The Quest for New Models of Watershed Governance, Ex Post Evaluation of an Earmarked Tax on Air Pollution, Microeconometric Strategies for Dealing with Unobservables and Endogenous Variables in Recreation Demand Models, The Housing Market Impacts of Shale Gas Development, Efficient Pollution Regulation: Getting the Prices Right, Environmental Accounting for Pollution in the United States Economy, Handling Unobserved Site Characteristics in Random Utility Models of Recreational Demand, Presidential Veto Message: Nixon Vetoes Water Pollution Act, Review of Environmental Economics & Policy, Shale Gas Development Impacts on Surface Water Quality in Pennsylvania, Homeownership Returns, Tenure Choice and Inflation, Objective versus Subjective Measures of Water Clarity in Hedonic Property Value Models, Building a National Water Quality Monitoring Program, Why Is Pollution from U.S. Manufacturing Declining? Rainwater monitors that are not in our data record increases of similar magnitude in rainwater pH over this period, and attribute it to declines in atmospheric sulfur air pollution (USEPA 2007). Online Appendix F discusses other reasons we believe have weaker support. For the few governments that do not report when their fiscal year ends, we assume they report by calendar year. We use the following regression to estimate the effects of Clean Water Act grants on water pollution: \begin{equation} The offer function is the firms isoprofit curve in the trade-off between home price and attribute j. All results have been reviewed to ensure that no confidential information is disclosed. Standard errors are clustered by watershed. Cumulative grants include grants in all previous years, not only census years. The Clean Air Act is a United States federal law designed to control air pollution on a national level. This tells us little about the Clean Water Acts effects, however, since its investments may take time to affect water pollution, expanded during the 1970s, and may be effective even if not obvious from a national time series. The Clean Water Act, passed with bipartisan support, was a historic milestone establishing a fundamental right to clean water. Online Appendix TableVI shows a variety of sensitivity analyses, and Online Appendix E.2 discusses each. Benefits and Costs of the Clean Air Act 1990-2020, the Second - US EPA These calculations use our regression estimates and the cost data. Beginning in 1977, grants provided a higher 85% subsidy to projects using innovative technology, such as those sending waste-water through constructed wetlands for treatment. Moreover, we are not aware of any existing ex post estimates of the cost required to make a river-mile fishable or to decrease dissolved oxygen deficits. Abstract. Contact: joseph.shapiro@berkeley.edu, UC Berkeley, Berkeley, CA 94720, (510) 642-3345, Fax (510) 643-8911. We estimate the value of wetlands for flood mitigation across the US using detailed flood claims and land use data. Another is that fishable and swimmable are limited between 0 and 1, and dissolved oxygen saturation does not much exceed 100%. Adding population or city revenue controls to the specification of column (4) in TableIV gives estimates of 1.22 (0.30) or 0.91 (0.18) for Panel A, and 0.92 (0.22) or 0.68 (0.13) for Panel B. For example, the USEPAs (2000a,b) estimate of the benefit/cost ratio of the Clean Water Act is below 1, though the EPAs preferred estimate of the benefit/cost ratio of the Clean Air Act is 42 (USEPA 1997).28. Although a point estimate of 0.41 for the ratio of benefits to costs does not exceed 1, one should interpret this value in light of the discussion from the next subsection that it may be a lower bound on true benefits. The increases are small and statistically insignificant in most years. We also explored estimates controlling for city-year population or city-year municipal revenue. Official websites use .gov The other pollutants decrease as wellBOD falls by about 2.4%, fecal coliforms fall by 3.6%, and the probability that downstream waters are not swimmable by about half a percentage point. Estimates without the basin year controls are more positive but also more sensitive to specification, which is one indication that the specification of equation (6) provides sharper identification. The tables separately list the different components of costs, and Section VII.C discusses possible effects of these costs on local taxes or fees. Smith and Wolloh (2012) study one measure of pollution (dissolved oxygen) in lakes beginning after the Clean Water Act and use data from one of the repositories we analyze. 2001; Jeon etal. We impute these values from a panel regression of log mean home values on year fixed effects and tract fixed effects. We interpret pre-1972 trends cautiously, however, because far fewer monitoring sites recorded data before the 1970s (Online Appendix TableI) and because the higher-quality monitoring networks (NAWQA, NASQAN, and HBN) focused their data collection after 1972. For this reason, our preferred methodology in Section IV.B to assess how Clean Water Act grants affect water pollution uses a triple-difference estimator comparing upstream and downstream areas. Estimates come from regression specifications corresponding to TableV, columns (3) and (4). Twenty Years of the Clean Water Act: Has U.S. Water Quality Improved? GLS based on the number of underlying pollution readings in each plant downstream year is an efficient response to heteroskedasticity since we have grouped data. Regulating Untaxable Externalities: Are Vehicle Air Pollution Standards Effective and Efficient? Graphs show coefficients on year-since-grant indicators from regressions corresponding to the specification of TableV, columns (2) and (4). The point estimates imply that the benefits of the Clean Water Acts municipal grants exceed their costs if these unmeasured components of willingness to pay are three or more times the components of willingness to pay that we measure. Flint potentially could have prevented these problems by adding corrosion inhibitors (like orthophosphate), which are used in many cities (including the Detroit water) that Flint previously used, at low cost. One general conclusion from this literature is that the effect of federal grants on local government expenditure substantially exceeds the effect of local income changes on local government expenditure (the latter is typically around 0.10). In 2020, the Clean Air Act Amendments will prevent over 230,000 early deaths. We now discuss six reasons the ratios of measured benefits to costs from the previous subsection may provide a lower bound on the true benefit/cost ratio. We considered a fourth repository, the Sustaining the Earths Watersheds: Agricultural Research Data System (STEWARDS), managed by the USDA. We recognize the potential importance of nonuse values for clean surface waters and the severe challenges in accurately measuring these values.26 Other categories potentially not measured here include the value for commercial fisheries, industrial water supplies, lower treatment costs for drinking water, and safer drinking water.27 Evidence on the existence and magnitude of the benefits from these other channels is limited, though as mentioned already, recreation and aesthetics are believed to account for a large majority of the benefits of clean surface waters. Optimizing consumers should equate the marginal disutility of pollution to the marginal cost of protection from pollution. The definition also includes standards for boating and drinking water that we do not analyze. Dependent variable mean describes mean in 19621972. Public outcry over dirty rivers spurred Congress to pass the landmark Clean Water Act in 1972. Misperception would be less important if most benefits of surface water quality accrue through recreation or aesthetics, since failing to perceive water pollution through any means would mean its effects on recreational demand are limited. If you experience a problem reading a document with assistive technology, please contact us. This article assembles an array of new data to assess water pollutions trends, causes, and welfare consequences. Our recreation data also represent all trips, and water-based recreation trips might require different travel distances. Effects of Clean Water Act Grants on Water Pollution: Event Study Graphs. Hence decreases in acidic sulfur air pollution may have contributed to decreases in acidic water pollution. The census long form has housing data and was collected from one in six households on average, but the exact proportion sampled varies across tracts. We also estimate linear water pollution trends using the following equation: \begin{equation} Others relate drinking water quality directly to health (Currie etal. Dissolved oxygen deficits and the share of waters that are not fishable both decreased almost every year between 1962 and 1990 (FigureII). \end{equation*}. \end{equation}, Political Internalization of Economic Externalities and Environmental Policy, What Are Cities Worth? Problem with enforcement. 8 Reasons the Clean Water Rule Fails to Protect People and - EcoWatch Search for other works by this author on: University of California, Berkeley and National Bureau of Economic Research. Municipal and grant costs are cumulative since 1970. The change in the value of housing is estimated by combining the regression estimates of TableV with the baseline value of housing and rents from the census. Reasons We Need the Clean Water Rule | whitehouse.gov Panel B shows no evidence that homes within 25 miles of the downstream river increase after a treatment plant receives a grant. A blueprint for clean water everywhere, for everyone Using a national time series to evaluate the Clean Water Act could imply that it has been counterproductive, since the rate of decrease in pollution slowed after 1972. It furthers the University's objective of excellence in research, scholarship, and education by publishing worldwide, This PDF is available to Subscribers Only. \end{equation}. Another test comes from the fact that the 19802000 gross rent data reported in the census include utilities costs. Considering all owner-occupied homes within 25 miles of the river, the estimated ratio of the grants aggregate effects on home values to the grants costs is 0.26. Some studies in historic or developing country settings, where drinking water regulation is limited, relate surface water quality to health (Ebenstein 2012; Greenstone and Hanna 2014; Alsan and Goldin forthcoming). One such channel involves substitutioncleaning up part of a river in an area with many dirty rivers might have different value than cleaning up a river in an area with many clean rivers. Notes. Consequences of the Clean Water Act and the Demand for Water Quality