The Comprehensive Everglades Restoration Plan (CERP), authorized by the US Congress in 2000, is a 30-year partnership between the US Army Corps of Engineers, the National Parks Service, and the South Florida Water Management District, among others, that is designed to address environmental challenges related to water – its quality, quantity, timing, and distribution. These characteristics of water have a significant influence on economic activities and are influenced significantly by the ecosystems of the Everglades, which have been degraded by encroaching development. The Everglades Foundation commissioned Mather Economics to estimate the economic impact of improved water regulation performed by the Everglades as a result of CERP. The benefits of interest for this research were:
- Groundwater purification and aquifer recharge
- Real estate (increasing property values)
- Park Visitation
- Open space
- Improved fishing habitat
- Wildlife habitat and hunting
- Carbon sequestration
Mather Economics conducted extensive literature review, expert interviews, and site visits to collect the relevant data and establish valid assumptions on which economic models could be built. Drawing on the collected data, including environmental, river discharge, housing price, employment, and tourism expenditure data, Mather Economics estimated the economic impact of the environmental improvements projected under CERP implementation. Each estimate is based on economic and analytical models that are supported by the latest science and most relevant data, and the results are presented to maximize interpretability and usability with an effort to offer transparency with respect to the assumptions and methodology used.
Our analysis strongly suggests that restoration of the Everglades, as described in CERP, will have large and important economic benefits. Our best estimate is that restoration will generate an increase in economic benefits of approximately $46.5 billion in net present value terms. The range of this estimate can be as high as $123.9 billion. Assuming an $11/5 billion cost of restoration, we estimate that the benefit:cost ratio of 4.04 for full CERP implementation. We stress that these results do not capture the full value of the Everglades system, but simply estimate the value of the marginal change in ecosystem services resulting from ecosystem restoration.