Analysis of Environmental and Economic Benefits of Natural Flood Storage Areas in the Passaic River

Sarah C. Watts (1), Josephine R. Axt (2), and Mark H. Burlas (3)

(1)Northern Ecological Associates, Inc., (NEA), 451 Presumpscot Street, Portland, ME  04103 (207)879-9496, (207) 879-9481, swatts@neamaine.com  www.nea-enviro.com

(2)NEA, 2 Avalon Place, Santa Fe, NM 87508, (505) 466-1890, (505) 466-1890, jaxt.nea@comcast.net, www.nea-enviro-com

(3)US Army Corps of Engineers, New York District, 26 Federal Plaza, New York, NY, 10278 (917) 790-8704. (212) 264-6040,: mark.h.burlas@nan02.usace.army.mil

As part of the United States Army Corps of Engineers (USACE), New York District’s, Passaic River Flood Damage Reduction Project (Project), NEA conducted an analysis of the environmental and economic benefits of natural flood storage areas along the Passaic River in New Jersey.  The purpose of the study was study was to identify and discuss the feasibility of using environmental and economic benefits to justify preserving natural flood storage areas along the Passaic River. 

The Project area has a history of flooding that dates back to the 1800s, and continued development in the watershed has increased the frequency and severity of flooding.  Damage estimates from the 1990s estimated that annual damages attributed to flooding cost approximately $95 million.  There is heavy development pressure in the Passaic River watershed, and if no action is taken to preserve natural flood storage areas, the USACE projects that approximately 346 acres would be lost to development by 2050.  Water quality, water supply, and open space and recreation benefits would be lost with the conversion of wetlands to impervious or disturbed land uses.

For this study, the USACE assessed marketable and non-marketable goods and services that are directly and indirectly associated with preservation of natural flood storage areas in the Passaic River watershed.  Preservation of the natural flood storage areas in the Passaic River watershed would result in the protection of substantial environmental benefits at a relatively low cost.  The average annual environmental benefits ranged from $3.7 million to $83 million (2004 dollars).  The average annual cost was estimated at $784,105, with average annual costs based solely on the real estate costs of purchasing wetlands for preservation.  The benefit-to-cost ratio therefore ranged between approximately 5:1 and 105:1.  Data collected on the benefits of preserving the natural flood storage areas in the Passaic River Central Basin indicate that the benefits of preservation substantially outweigh the costs.

Study estimates for the number of lost acres of natural flood storage were based on actual land use conditions in 1990.  Development in the region has continued since these initial calculations were made, with a resulting in increase in impervious surfaces in the region, so it is likely that flood hydrographs underestimate current flooding potential. Future development of the natural flood storage areas in the Passaic River watershed could produce long-term, irreversible changes to the watershed, and to the many goods and services currently provided by these wetlands.