Making water work

The City of Charlottesville and Albemarle County are interdependent. Most folks understand this: In general, the city and urban Albemarle are centers of jobs and cultural activities, as well as being the area’s population hub. Rural Albemarle provides views, open space and recreational opportunities to all area residents, as well as offering its own menu of employment and cultural possibilities.
But, the relationship doesn’t stop there. It turns out that the lifeblood of urban Charlottesville and Albemarle residents is provided by rural Albemarle landowners — the one service without which habitation would be impossible — clean drinking water.
Recently, a new nonprofit organization, Conserv, partnered with the Virginia Department of Forestry — along with the Rivanna Water and Sewer Authority, County of Albemarle, City of Charlottesville, Albemarle County Farm Bureau, American Water Works Association, Blue Ridge Homebuilders, Charlottesville-Albemarle Regional Chamber of Commerce, Piedmont Environmental Council, Rivanna River Basin Commission, Thomas Jefferson Soil and Water Conservation District, the University of Virginia and Virginia Tech — to submit a proposal to the U.S. Endowment for Forestry and Communities Inc. for the creation of a demonstration process to financially link urban water consumers with rural owners of forestland in the South Fork Rivanna Reservoir watershed.
The project, called the South Fork Rivanna Forests to Faucets Initiative, was one of three proposals selected nationwide for three-year funding. Forests to Faucets officially launched in February of this year.
The idea behind the project is simple. Rural landowners should be compensated for the environmental services, such as water quality, that their forestlands provide for others to use. These services are often referred to as “ecosystem services.” Four ecosystem services are related to the health of the South Fork Rivanna Reservoir and watershed. They are: nitrogen retention; phosphorus retention; soil retention, and summer groundwater flow to streams.
For the F2F project, we are creating a process that financially links rural landowners with urban and suburban consumers of water. This process will attempt to quantify the tangible benefits to the reservoir and watershed from alternative forest cover scenarios generated as a result of alternative management programs. The dollar per quantity of ecosystem service gained from conservation management (increased forest cover) will be compared to the same metric gained through engineered capital improvements (such as dredging). The quantity of ecosystem service gained will then be translated into a currency we all understand — a gallon of drinking water.
What causes some to pause is the notion that a landowner should be paid for services that historically have been free to the public. Our view is founded on ecological economic theory — payment for such services would be irrational when human population densities are low and the assets that provide these are plentiful. But, when human population increases and these assets become scarce, to not internalize them into our economy is a “market failure.” Payment for ecosystem services is a way to correct this problem.
Because of the grant, the Virginia Department of Forestry will have significant funds available to make payments to rural landowners in the South Fork Rivanna area. Rural landowners who offer the most efficient opportunities to enhance their water quality services (through forestry-related management practices) will be offered contracts now through the spring of 2012. Examples of these forest management practices include: tree planting on open land; assistance with placing lands into conservation easements; pre-harvest planning; timber harvest site stabilization, and leaving riparian buffers during forest harvests.
One of the most important practices that the partnership seeks to support is tree planting on open land (hay, grazed, grassed or tilled lands). This portion of the project will demonstrate a process for gaining an efficient cost for planting trees on parcels with five acres or more of open land. Another project of interest is for riparian buffer establishment. The minimum size for this type of planting project will be one acre. In addition, 10 percent of any planting project can have a wildlife habitat component.
A contract between the landowner and the Virginia Department of Forestry would specify the terms (20 years), the payment (provided as a one-time lump sum), and the forest management responsibilities. In an attempt to bring efficiency to the determination of ecosystem system service costs, the partners have created a landowner bidding program that will begin July 12 and end July 30.
Financial incentives through land rental payments for the life of the contract as well as the tree planting establishment costs are covered through the program. The likely range of payments to be provided is anticipated to be commensurate with those a rural landowner might receive for agricultural commodities, such as hay, cattle, crops or land rental.
It is noteworthy that a lump sum payment for the 20-year land rental contract will be provided to winning bidders. This could be a significant dollar amount. For example, a landowner with a 10-acre portion of a property that is currently open space might bid $75 per acre. Using a discount rate of 7 percent, for example, would mean the landowner would be paid approximately $7,950 plus have all the costs for trees and labor covered. (It is important to note that the ceiling on submitted bids for the land rental is capped at $100 per acre.) The land rental rate that landowners bid for his tree planting projects will be an important factor in determining if the bid is successfully chosen for funding.
This program is open only to landowners in the South Fork Rivannna Reservoir ara. Anyone interested in the project — and particularly in the possibility of receiving payment for water quality-related land management activities — should go to the F2F Web site (www.foreststofaucets.info) or contact Dave Powell, assistant regional forester, at 434-977-5193.
If successful, this program will help ensure the quality of the water available to all in the SFRR watershed.

Michael Collins is the executive director of Conserv, a new nonprofit organization working to design and construct environmental markets to restore keystone ecosystems and former environmental planner with the Thomas Jefferson Planning District Commission. Nick Evans, Ph.D., is a professional hydrogeologist who serves as director of Research for Conserv. He is an elected director from Albemarle County and Chairman of the Thomas Jefferson Soil & Water Conservation District. Buck Kline is director of forestland conservation for the Virginia Department of Forestry, responsible for the agency’s conservation easement, Forest Legacy, utilization and marketing and ecosystem services initiatives.