Great Lakes cleanup could generate $50 billion windfall, report says
Wednesday, September 05, 2007
Deb Price / The Detroit News

WASHINGTON -- A sweeping restoration of the Great Lakes would yield at least $50 billion in economic benefits, including a huge boost in the value of nearby residential homes, a report released today by the prestigious Brookings Institution concludes.

An additional $30 billion in short-term gain -- reflecting such things as new construction jobs and workers' purchases at stores -- would also follow the proposed massive cleanup of the Great Lakes currently awaiting action by the U.S. Congress.

"If the lakes are sick, our economy gets sick," said Andy Buchsbaum, co-chairman of the Healing Our Waters-Great Lakes Coalition. " Delaying makes the problem worse and more costly. The time to act is now."

The "Healthy Waters, Strong Economy" report by leading economists is released as Congress is asked to spend about $26 billion to clean up the Great Lakes.

A report released two years ago by stakeholders ranging from scientists to environmentalists to business leaders asked the federal government to chip in most of the cost of cleaning up toxic chemicals, upgrading aging sewage systems, stopping invasive species and tackling similar threats to the fresh water treasure. Then the cost was estimated at $20 billion. But the authors say in just the two years, the estimated cost of cleanup has gone up.

Economists and other participants on a teleconference call with reporters today urged Great Lakes-area residents to urge 2008 presidential candidates to pledge to support restoration for the huge economic benefits to the region.

"This is a jobs engine for the region," said John C. Austin, a senior fellow at the Brookings Institution and the lead author of the report (full report is available at healthylakes.org.

The reports authors said they used several economic models to calculate the impact of the approximate $26 billion investment in cleanup. The most valuable, they concluded, was to analyze how much residential housing prices within about 1 mile of the lakes would rise.

They estimate nearby residential property values in the eight Great Lakes states would go up on average 10 percent, or about $50 billion. The areas that would see the greatest improvement in housing prices would be those with the biggest problems now with beach closings, sewage overflows and toxic sediments.

In addition, because improved water would draw people to live and visit states like Michigan, cities like Detroit would see about a 2 percent rise in residential property values.

While the economists did not calculate how commercial property values might increase, they told reporters it could easily match the $50 billion figure for private homes.

The economists said the current drop in property values in states like Michigan and flight of residents to coastal areas could be reversed by the attractiveness of living near cleaner water as well as newly created job opportunities.

"(Investing in cleanup) makes tremendous sense in terms of the economic strategy for our region and out country," said report lead author Austin. "These restoration activities aren't just nice things to do for the environment."

You can reach Deb Price at dprice@detnews.com or (202) 662-8736.
 

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