Today, Ohio Governor John Kasich will issue an executive order asking the Ohio Soil and Water Conservation Commission to declare eight Ohio waterways 'distressed' due to high phosphorous levels (phosphorous is one of the primary ingredients in commercial fertilizer):
Frustrated by lawmakers’ refusal to consider a bill to get tougher on sources of agricultural pollution feeding Lake Erie’s chronic toxic algae problem, Gov. John Kasich on Wednesday took matters into his own hands with an executive order.
“This is just requiring farmers to figure out a way to manage their land in a more effective and environmentally friendly way,” the Republican governor said. “I believe that farmers want to do that.”Under the order, his administration will ask the Ohio Soil and Water Conservation Commission at its July 19 meeting to designate eight watersheds or portions of watersheds with high phosphorous levels within the Maumee River Basin as “distressed.”
That would trigger the writing of rules affecting all agricultural nutrient sources, including such things as storage, handling, and application of manure; erosion and sediment control from the land; and other agricultural practices. Civil penalties could apply for violations.
Phosphorous loadings into the Maumee river watershed are the primary cause of Harmful Algal Blooms (HABs) in the Western Lake Erie Basin. HABs cause a variety of health and economic losses including contaminated drinking water, reduced recreational activities and decreases in local housing values. Kasich's Executive Order, followed by the 'distressed' designation will broaden the set of tools available to policy makers to address the HAB issue in Ohio. As part of a college-wide effort to document and consolidate Ohio State's research and outreach efforts in this area, a group of environmental and agricultural economists were asked to draft a section of a report on the Economics of Nutrient Reductions to Control Harmful Algal Blooms. While the full report isn't quite ready for public consumption, I can highlight here a few of the main points from the economics section (really these are just the opening sentences to each paragraph):
- Numerous policies have been recommended to reduce agricultural nutrient emissions, ranging from purely voluntary efforts to strict regulations.
- While purely voluntary programs may struggle to achieve widespread application of conservation practices, or even nutrient reduction, society has developed large-scale subsidy programs to encourage these practices through the Conservation Title of the Federal Farm Bill.
- Regulatory programs are at the opposite end of the spectrum from voluntary subsidy programs.
- There have been [few] efforts in Ohio to use market mechanisms to reduce agricultural nutrient emissions.
- Market mechanisms use economic incentives to encourage behavioral shifts among economic actors, such as farmers. Market mechanisms include policy instruments like pollution taxes and tradable pollution permits. Pollution taxes work by raising prices for polluting inputs or outputs, thus encouraging farmers to use or emit less of the input or output. Tradable pollution permits impose limits on emissions but then allow trading among the regulated sources to reduce the costs of meeting the targeted aggregate abatement level.
There's a lot more in the draft section about the types of ongoing research environmental economists are undertaking to estimate the benefits and costs of reducing HABs, and the types of market-based policies that can achieve the necessary reductions in phosphorous loadings. But, the upshot is this:
- Voluntary programs to reduce phosphorous loadings have been unsuccessful in reducing phosphorous loading to optimal levels.
- Command-and-control type regulatory programs (everyone must do A, then B) may work, but are very costly to farmers and society.
- Market-based mechanisms, like taxes, subsidies, and tradable emissions programs, designed correctly, can achieve optimal nutrient reductions AT A MUCH LOWER COST.
There's no silver bullet to solving this problem. Hopefully, working together, we can solve the problem as painlessly as possible. Any solution is going to cost someone something, but not solving the problem will cost a lot more.