$1.6 trillion working landscape in Upper American River Watershed is worth our investment

The lands within the Upper American River Watershed (UARW) provide critical economic, environmental and community benefits. The watershed contains working landscapes, which include agricultural lands, forests and ranchlands as well as natural lands such as conservation lands, shrublands, wetlands, greenspace, open water, rivers and lakes. These working landscapes produce valuable ecosystem goods and services each year, including food, water, clean air, hydroelectric power, beauty, drought and fire risk reduction, habitat, recreation and more. The watershed's ecosystem goods and services are enjoyed and relied on by residents throughout the state, nation and even globally. In addition to understanding the immense benefits the watershed provides, it is important to quantify the monetary value of our headwaters. When we understand the true economic value of nature, it enables decision makers to make informed investments in both natural and built capital assets. The El Dorado Water Agency (EDWA) recently released a report on the valuation of ecosystem goods and services in the UARW which found that the working landscapes (including working and natural lands) within the watershed are worth more than $1.6 trillion over a 100-year period. This valuation is important as it provides an incentive to both protect and invest in the UARW. When looking at this value on an annual basis, the UARW produces about $14.9 billion/year in benefits both within and outside of the watershed. Each land cover type (forest, shrublands, grassland, agriculture, open water, wetlands and developed/open space) provides different ecosystem goods and services and plays an important role to society, the economy and the environment. In this watershed, forests provide the highest per-acre benefit and cover the largest land acreage. Yet, this forested landscape is highly susceptible to natural disasters such as wildfires that take decades to recover from. We also performed a complementary analysis on the value of outdoor recreation, which attracts millions of visitors each year who enjoy numerous activities, including skiing, hiking, fishing, whitewater rafting and more. Our analysis found that in 2022, outdoor recreation generated $607 million in economic output from visitor spending and $660 million in non-market benefits beyond direct spending. Our analysis also confirmed that outdoor recreation in the UARW is not only valued by those who live in the watershed but those throughout the world. In 2022, there were 7 million recreation visits in the UARW, with 53 percent of visits from tourists worldwide. Attracting tourists from outside the watershed not only allows them to experience the benefits of nature but also supports the local economy. While tourists made up about half of the visits, they contributed more than 76 percent of the total expenditures, underlining their economic importance to the region. Being away from home, tourists tend to incur additional costs in food, lodging and transportation, contributing to elevated spending profiles, thus boosting the local economy. Working and natural lands in the UARW are facing numerous challenges and risks that could jeopardize their ability to sustain long-term benefits if not properly mitigated. Wildfires, droughts and inadequate forest management compromise the ecological integrity of the land and diminish their appeal and accessibility for residents and visitors. The greatest obstacle for reaching and maintaining a healthy, productive watershed is that the UARW and its benefits had not previously been properly valued. Our valuation of the UARW is unique, as natural systems are not typically valued as economic assets. As a result, there has been underinvestment in maintaining the health of working and natural lands. Understanding the economic value of the watershed will help local, state and federal agencies, Tribes, non-profits, businesses, downstream beneficiaries and interested parties better coordinate, prioritize and justify multi-beneficial, holistic and innovative landscape-scale investments in watershed projects as well as develop sustainable water management practices while meeting the needs of adjacent communities. Lori Parlin is El Dorado County Supervisor and EDWA Board Chair, and Rebecca Guo is General Manager of the El Dorado Water Agency.