Policy Matters is a quarterly series of reports that provide timely research and guidance on issues that are of concern to policymakers at the local, state, and national levels.

Volume 2, Issue 3 by Kenneth A. Baerenklau, W. Bowman Cutter, Autumn DeWoody, Ritu Sharma, and Joong Gwang Lee is entitled: Capturing Urban Stormwater Runoff: A Decentralized Market-Based Alternative.


Executive Summary

Urban stormwater runoff is both a source of pollution and a potentially valuable resource. Large centralized facilities traditionally have been used to manage runoff. The deployment of small-scale decentralized capture devices (known as stormwater Best Management Practices, or BMPs) can decrease the need to purchase expensive urban land or use scarce publicly-owned land for centralized facilities.

In this report we investigate the cost-effectiveness of implementing parcel-level BMPs in a Los Angeles area watershed using competitive bidding. We then compare the costs of bidding and centralized alternatives and find that the bidding alternative is significantly less expensive than a centralized alternative for a range of stormwater capture goals. Finally, we examine the water supply value of the stormwater infiltrated by BMPs and find that it can amount to 38% of the total BMP cost.

Our research shows that, in most scenarios involving urban stormwater runoff, decentralized, incentive-based strategies using small-scale capture devices is more cost-effective than centralized strategies. We offer several recommendations on approaches to implement decentralized strategies, including payment mechanisms that discourage early exit, and Internet-based incentive calculation and program monitoring.

Kenneth Baerenklau is Associate Professor of Environmental Policy and Associate Environmental Economist
at UC Riverside. Bowman Cutter is Assistant Professor of Economics at Pomona College and an adjunct Assistant Professor in the Department of Environmental Sciences at UC Riverside. Autumn DeWoody received her M.S. in Environmental Sciences from UC Riverside in 2007, and is Programs Director for Inland Empire Waterkeeper in Riverside. Ritu Sharma is a post doctoral researcher in Environmental Sciences at UC Riverside. Joong Gwang Lee recieved his PhD in 2003 from the University of Colorado, and is an environmental and water resources engineer.

For additional information, contact Kenneth Baerenklau at (951) 827-2628 or ken.baerenklau@ucr.edu