The Tahoe Planning Game

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The Tahoe Planning Game

• or
• Managing a Multi-Flow Resource

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Lake Tahoe is Losing Water Claritydate posted
December 12 2001 (by LTEEC) Lake Tahoe waters
have been losing transparency at an average of
about one foot each year since the late 1960s.
Lake Tahoes exceptional clarity is a result of
the absence of suspended sediment and
free-floating, single-celled algae in the water.
Given undisturbed conditions, the lakes water
quality would change so slowly the changes would
be undetectable over a human lifetime. Human
settlements and logging activities that began in
the late 1880s have contributed to the rapidly
declining clarity. Lake Tahoes clarity has
decreased by more than 33 percent since the 1960s
and is steadily declining at the rate of one foot
a year. Scientists say that the rate of water
quality deterioration at Lake Tahoe has been
steady for so long it may become irreversible in
10 years. Lake Tahoes water quality problems
are not caused by industry or by wastewater
treatment plants. The causes of water pollution
are the daily activities of the thousands of
residents and visitors in the Lake Tahoe
watershed. We all need to learn to reduce our
impact on the environmentimpacts like erosion,
over-fertilization, spills, leaks, and
disturbances of soils and stream environment
zones.
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Administrative Background

• The Tahoe Regional Planning Agency (TRPA) has
  been mandated by Federal State Governments to
  increase clarity by 10 feet over the next 10
  years.
• Expected ecological results
• clearer, more brilliant colors
• larger population of sea trout
• (marginally) cleaner water in Truckee River
• Its up to TRPA how this objective is achieved.
• Assume that TRPA has full jurisdiction control
  over all commercial and recreational activities
  in the Tahoe Watershed, as well as over all
  traffic flows in the area.
• TRPA scientists devise three regulatory action
  scenarios that each would meet the mandated
  ecological goal.

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Benefit Analysis

• Ignoring for a moment any costs of achieving this
  goal, who will likely benefit from improved
  clarity?
• Which of these benefits are public (i.e. social),
  which are private?

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Scenario 1

• Close HW 89 between Tahoe City and South Lake
  Tahoe from Sept June
• What is the nature of resulting costs?
• Who will bear these costs?
• Are these costs private or public?

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Scenario 2

• Ban all motorized traffic on the lake
• What is the nature of resulting costs?
• Who will bear these costs?
• Are these costs private or public?

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Scenario 3

• Close all Campgrounds around the lake.
• What is the nature of resulting costs?
• Who will bear these costs?
• Are these costs private or public?

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Benefits vs. Costs

• How does each scenario affect the benefits you
  identified before?
• Does it generate additional benefits?
• Does it diminish benefits you identified
  earlier?
• Which scenario, if any, would you consider the
  least costly to
• private parties
• the public
• Why?

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Economic Tools?

• Can you think of any economic tools TRPA could
  have used instead or in conjunction with
  regulatory approaches to meet the environmental
  objective?
• What are the pros cons of these economic tools
  over (some of) the regulatory measures?

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Conclusion

• Most policy interventions targeting ecosystems
  affect many different stakeholders
• There usually are (economic) winners losers.
• The mix of winners losers may change over time.
• It would be difficult to implement ANY
  (regulatory or economic) policy without violating
  the Pareto Principle.
• Often used criterion for choosing amongst set of
  policies maximize net social benefit
• This requires careful economic analysis.
• Even then, the planner is still left with equity
  issues...