Paying for Change: Existing Environmental Programs May Show the Way Forward
Posted on Aug 13, 2019The 116th Congress made waves last week in the world of environmental conservation. No, not the Green New Deal—more on that later. In an exceedingly rare moment of bipartisan legislative activity, the Senate passed S.47, colloquially known as the Natural Resources Management Act, with a tally of 92 yea votes to only 8 nays. The bill, introduced by Sen. Maria Cantwell (D-WA) and Sen. Lisa Murkowski (R-AK), is the culmination of four years of work by western lawmakers and includes over a hundred unique provisions providing public land benefits across more than a dozen states—impacting over 2 million acres of federal land. S.47, which is expected to pass the House with broad support, contains several key features. It creates 1.3 millions acres of new wilderness, the most stringent level of federal land protection; adds another 694,000 acres of recreation and conservation land; and places a permanent mineral extraction ban on nearly 400,00 acres surrounding Yellowstone and Cascade National Parks. Perhaps the most significant feature of this legislation, though, is the permanent reauthorization of the Land and Water Conservation Fund (LWCF).
The LWCF was created in 1965 and functions on a simple, yet effective and popular, premise: use the revenue generated in the exploitation of one natural resource to preserve other natural resources. In this context, energy companies pay fees and royalties to the Bureau of Ocean Energy Management in order to drill for oil and gas off the Gulf Coast. Those funds—potentially totaling up to 900 million dollars per year—are then used in the maintenance and expansion of national parks, preservation of protected federal lands, and to issue matching grants for state projects. It is worth noting that Congress frequently re-appropriates some portion of this funding. However, in the five decades since its enactment, the LWCF has dispensed more than $16 billion dollars to over 40,000 state and federal projects, all without using taxpayer dollars.
Speaking of taxpayer dollars, the Natural Resources Management Act also included provisions to modernize another conservation focused bill, the Pittman-Robertson Act (PRA). Established in 1937 as the Federal Aid in Wildlife Restoration Act, but better known for its sponsors— Sen. Key Pittman (D-NV) and Rep. Willis Robertson (D-VA), the PRA imposes an excise tax on firearms, ammunition, and archery equipment. This tax revenue is then passed on to the states by the U.S. Fish and Wildlife Service. Since its inception, the PRA has generated over $10 billion dollars and played a critical role in the revival several North American species, such as the white-tail deer, turkey, and wood duck. It has also been used to acquire over 4 million acres of land used to support wildlife and manage another 40 million acres.
Both the PRA and LWCF utilize a common underlying framework: the entity benefiting from an activity must offer recompense for that benefit. In the case of the PRA, the hunter funds the conservation of various wildlife species. For the LWCF, the energy company enables the preservation of a multitude of natural resources. Looking at this principle, it’s not hard to see why both policies are wildly popular. The burden is shouldered by those primarily reaping the rewards, but at levels that don’t completely disincentivize the activity altogether. The residual beneficiary, the general public, enjoys the conservation efforts without financing it.
So, back to the Green New Deal. On February 7th, Rep. Alexandria Ocasio-Cortez (D-NY) and Sen. Ed Markey (D-MA) unveiled a fourteen page resolution. While the resolution touches matters outside of climate change, a considerable number of the goals are aimed directly at combatting this problem, and perhaps appropriately so, considering the UN has characterized climate change as an existential threat. The Green New Deal aims for net-zero greenhouse gas emissions and 100% renewable energy within ten years. These are ambitious goals. And they are expensive goals. One calculation places the number for climate related goals alone at $13.4 trillion dollars over ten years—for reference, the annual federal tax revenue is slightly less than $4 trillion. Immediately after release of the resolution, there was outcry over the scope and cost of the proposal. But the need for some form major reform is abundantly clear. Furthermore, private companies have little or no incentive to lead the charge, which places the burden on the government, specifically Congress to develop a strategy. Congress, though, also faces a tough incentive structure: do nothing and face repercussions; raise constituents’ taxes by too much and face repercussions. Striking the middle ground is the key.
Enter the LWCF and PRA, two widely popular programs already used to protect the country’s natural resources. While it would be foolish to suggest that these programs could be used to effectuate the Green New Deal or similar program—there is a magnitude of difference in annual revenue between what’s collected versus what would be required—these programs can serve as an illustrative model. Targeted programs face less political backlash compared to broad sweeping changes. The PRA already has room to grow with the potential to add excise taxes to products used by the modern consumers of public lands: hikers, climbers, kayakers, and users of motorized recreational vehicles. These funds could be earmarked for a variety of environmental projects. Likewise, the LWCF model could be expanded. By viewing greenhouse gas emissions as a type of natural resource, those entities and activities which create the most emissions will in turn fund other programs that actively seek to decrease emissions. Rather than placing these revenues in to Congress’s general coffer, they remain earmarked exclusively for projects combatting climate change. Now, it is unlikely that a program like this, or even a series of programs like this would be sufficient alone. But they will lighten the burden on the general populace, helping Congress to find the middle ground where more substantial action can happen.