Government Not Reporting Billions Spent on Endangered Species Act, Study Shows; Legal Group Calls for True Accounting of ESA

4/14/2004

From: Dawn Collier of Pacific Legal Foundation, 916-362-2833, ext. 3029; Web: http://www.pacificlegal.org

SACRAMENTO, Calif., April 14 -- Pacific Legal Foundation today called for a true accounting of the Endangered Species Act, pointing to a study released today showing that billions of dollars in costs spent enforcing and complying with the ESA are not being reported to Congress or the American people. The study, Accounting for Species: Calculating the True Costs of the Endangered Species Act, was conducted by the Property and Environment Research Center (PERC). PERC researchers found that the U.S. Fish and Wildlife Service (FWS) grossly underreported federal and state ESA costs in its recent report to Congress, and completely ignored the private economic and social costs of ESA compliance, which together easily total billions of dollars a year.

The ESA requires the FWS to report to Congress annually on ESA expenditures by federal agencies and states receiving grants under the Act. In December, 2003, FWS released its Three-Year Summary of Federal and State Endangered Species Expenditures, Fiscal Years 1998-2000, to account for three years of missed reports.

PERC researchers found that the FWS report does not provide an accurate or comprehensive assessment of the true costs of the ESA. For example, the FWS reports that in 2000, state and federal expenditures totaled $610.3 million. PERC estimates that the actual government costs annually are as much as four times greater-or $2.4 billion. FWS also reports that in the 11 years from 1989 to 2000, just over $3.5 billion of taxpayer dollars was spent on ESA-related activities. According to PERC, the actual cost of protecting species, adding private costs to government expenditures, may easily reach or exceed $3.5 billion per year.

"PERC's study shows that the government has no idea what the ESA is truly costing, but it does give us an idea of the enormous human costs of ESA regulation-and they're often devastating. People have lost their jobs, businesses, homes, farms, and even their lives to protect plants, insects, and fish," said Emma T. Suarez , an attorney with Pacific Legal Foundation, a public interest legal organization that is a national leader in the effort to raise awareness of the ESA's impact on people.

"The government is accountable to the people, and good law takes people into account," said Suarez. "When it comes to the ESA, a true accounting for the law's impact on Americans begins with Fish and Wildlife Service doing a better job at collecting the information it is supposed to collect under the law. Furthermore, the ESA needs to be changed so that information on impacts to local governments, communities, and individuals is also collected."

"We're asking the government to account to the people for a failed law that ignores human values," added Suarez.

"The FWS report does not come close to accounting for the true costs to taxpayers and consumers of complying with the ESA," said report authors Dr. Randy T. Simmons, a Senior Associate at PERC and a political science professor at Utah State University, and Kimberly Frost. Dr. Simmons has studied the Endangered Species Act extensively and is the author of a book on endangered species written for high school students.

"We've spent trillions of dollars on the ESA and the few species that have been delisted were not removed because of ESA protections. Taxpayers deserve to know if we're getting what we pay for. An honest public dialogue about the value and effectiveness of the Endangered Species Act must take into account the costs incurred by taxpayers and the people being regulated. The government is ignoring the human costs in the ESA equation," added Simmons and Frost.

WHY THE FWS COST REPORT IS INCOMPLETE AND INACCURATE

According to PERC's study, FWS omits the following critical information in its 2003 cost report:

-- Not Reported: Actual costs to taxpayers; only estimates are provided.

-- Not Reported: Government-wide costs. Only a handful of federal agencies and departments affected by the ESA reported expenditures to FWS. Costs that benefit multiple species, staff salaries and operations are not reported.

-- Not Reported: Costs to taxpayers of litigating ESA cases.

-- Not Reported: Costs to state and local entities of implementing species recovery. State and local governments are responsible for much of the implementation of the ESA. However, because there are no standardized or required reporting procedures, only state and local expenditures voluntarily reported are estimated in the report.

-- Not Reported: Additional costs to local governments from ESA-caused interference with building schools, hospitals, roads, and other infrastructure projects.

-- Not Reported: Costs to private landowners. 75 percent of all listed species have portions or all of their habitat on privately owned land, and FWS regulates 38 million acres of private land through conservation plans. Landowners are not compensated for their losses from ESA regulations, yet these enormous costs are not included in the FWS report.

-- Not Reported: Private costs such as development projects being denied, delayed, or their scope reduced, which result in higher home prices. Higher home prices and increased commute times cost consumers in their pocketbook and day-to-day quality of life. Consumers on the lowest end of the housing affordability spectrum disproportionately bear this burden.

-- Not Reported: Economic and social costs from regulatory burdens placed on agricultural production, water use, forest management, and mineral extraction. Costs to private industry are enormous and are passed on to consumers in the form of higher prices. The costs to individuals who earn their livelihoods in these industries is devastating. Farmers in the Klamath Basin lost an estimated $53.9 million of crop value in 2001 when their irrigation was cut off to protect fish.

-- Not Reported: Lost jobs, business, and tax revenue. FWS does not report the costs of regulation that causes reduced business activities, reduced personal income and tax revenues, and costs of public assistance provided to individuals who have lost jobs. At least 130,000 jobs were lost when more than 900 sawmills, pulp, and paper mills closed in mid-1990 to protect the northern spotted owl.

-- Not Reported: Costs of protecting foreign species.

HALF OF GOVERNMENT ESA DOLLARS SPENT ON JUST SEVEN SPECIES

According to PERC, 50 percent of the total expenditures reported by FWS for 2000 are for the top seven species, or just 0.6 percent of the ESA list. Salmon species are by far the costliest, accounting for the top five most expensive species in 2000. Fish make up a full eight of the top ten.

THE ESA IS NOT SAVING SPECIES

According to FWS, as of December, 2003, 1,260 U.S. species were listed as endangered and only 15 have been delisted. PERC reports that the majority of the 15 delisted species were delisted because of original listing data errors, such as inaccurate government surveys that undercount a species later found to never have been endangered. Other species were conserved by state agencies or private organizations.

ABOUT PLF AND PERC

PLF is a public interest legal organization and national leader in the effort to raise awareness of the ESA's impact on people. PERC is a nonprofit institute dedicated to improving environmental quality through the markets. PERC conducts research and policy analysis on a wide variety of natural resource issues. To read the PERC study, visit http://www.pacificlegal.org .