Headwaters Winter 2011: Ecosystem Services-- Life as we know it

2 C o l o r a d o f o u n d a t i o n f o r W a t e r e d u C a t i o n

Colorado Foundation for Water Education1580 Logan St., Suite 410 • Denver, CO 80203

303-377-4433 • www.cfwe.org

Board Membersrita Crumpton

President

Justice Gregory J. Hobbs, Jr.1st Vice President

Taylor Hawes 2nd Vice President

Callie HendricksonSecretary

Reagan WaskomAssistant Secretary

Alan HamelTreasurer

Chris RoweAssistant Treasurer

Becky BrooksSteve Fearn

Jennifer GimbelAlan Matlosz

Trina McGuire-CollierRebecca Mitchell

reed MorrisChris Piper

Rick SackbauerRobert Sakata

Sen. Gail Schwartz travis Smith

Rep. Jerry SonnenbergChris treese

Steve Vandiver

StaffNicole Seltzer

Executive Director

David HarperOffice Manager

Kristin MahargEducation Program Associate

Aaron ParkerOSM/VISTA Program Assistant

Currents .................................................................................................. 1

Water Leaders Program ........................................................................ 2

Welcome New Board Members ............................................................ 2

Watermarks ............................................................................................ 3

The Power of Ecosystem Services ....................................................... 4 Why conservationists are translating “environmental integrity” to read “human quality of life”

It’s Not Too Late .................................................................................... 7 To recognize and embrace nature’s inherent value

From Forests to Faucets ..................................................................... 11

Ecomarkets and the Farm of the Future ............................................ 14

Simply Irreplaceable ............................................................................ 21 Protecting wetlands is tricky business, but these ecological heavyweights are worth it

The Cost of Recovery .......................................................................... 26

Member and Sponsor Acknowledgment........................................... 29

HEADWATERS | Winter 2011

Mission Statement The mission of the Colorado Foundation for Water Education is to promote better understanding of water resources through education and information. The Foundation does not take an advocacy position on any water issue.

Acknowledgments The Colorado Foundation for Water Education thanks the people and organizations who provided review, comment and assistance in the development of this issue.

Headwaters is a magazine designed to provide Colorado citizens with balanced and accurate information on a variety of subjects related to water resources. Copyright 2011 by the Colorado Foundation for Water Education. ISSN: 1546-0584 Edited by Jayla Poppleton. Designed by Emmett Jordan.

Rachel Odell Walker has covered wolf reintroduction into Yellowstone National Park, logging in the Pacific Northwest, hydroelectric dam operation and Native American rights for such publications as High Country News, 5280 and Backpacker. She was a Ted Scripps Fellow in Environmental Journalism at the University of Colorado in 2004-2005 and currently freelances from Boulder. Of her story on recognizing nature’s value, she says, “It’s very exciting to see conservation being embraced on such a broad scale by a variety of interest groups, and I think that’s happening because the financial component appeals to everyone, regardless of their political and philosophical persuasions.”

Freelance writer Emily Palm writes her ski column “Steep Shots” for the Fort Collins Coloradoan and the Summit County Citizens Voice, with other work appearing in The Christian Science Monitor and The Aspen Times. Currently living in Golden, she writes outdoor recreation, envi-ronmental and human profile articles. In researching her story on Denver Water and the U.S. Forest Service’s partnership, she learned that Colorado’s forests provide surface water to 30 million U.S. residents and says, “Beyond the intrinsic value of protecting healthy forests and habitats, that fact should prove that everyone has a stake in caring for our forests. As several of my sources said, the Rockies really are America’s water tower.”

Joshua Zaffos is a Fort Collins-based freelance writer who reports on the environment, science and politics. His work has appeared in High Country News, Wired, Miller-McCune and Grist, and he reports on green business and technology for the Northern Colorado Business Report.” After being exposed to ecosystem services and markets in graduate school, Josh says, “It was great to revisit the topic nearly a decade later and find out what sort of projects are developing on the ground. In Colorado, we are fortunate to have some leading critical thinkers in the field advocating for and cooperating on a number of projects that could showcase how environmen-tal markets can work.”

Cally Carswell writes from Paonia, a funky, Western Slope outpost on the banks of the North Fork of the Gunnison River. She is assistant editor of High Country News, where she edits, writes and produces multimedia stories about environmental and natural resource issues around the West. When she moved to the arid Southwest from water-logged Minnesota, Cally didn’t expect to do much reporting on wetlands. But writing for this issue, she discovered that, “In Colorado, just like in the Midwest, wetlands are small-but-mighty ecological workhorses.”

Denver-based freelancer Rebecca Landwehr Olgeirson’s work has previously appeared in 5280, the Denver Business Journal, Natural Solutions magazine and The Denver Post. Her story on species recovery for this issue served as a fast introduction to Colorado’s complex water issues. “The collaborative approach in Colorado between water users, the U.S. Fish and Wildlife Service and the fish specialists is saving time and money on all fronts,” she says. “It also made reporting the story a perfect introduction to the topic as I was exposed to several varied inter-ests within a narrow subject matter.”

About the authors…

One goal of the Colorado Foundation for Water Education is to give our readers a broad understanding of water issues that will help

you connect the dots between seemingly disconnected issues and put your particular passion into a larger context. This issue of Headwaters, for example, explores the connec-tion between environmental conservation and capitalism.

The intention is that, if those interested and involved in water resource issues understand the big picture, they can more eas-ily communicate the importance of water to their customers, friends, stakeholders and peers. This will create a cycle of learn-ing and teaching that can impact thousands of Coloradans.

However, there are some who believe the “powers that be” want the general public to neither understand nor be involved in water-related decisions, that in some no-longer-smoke-filled-but-still-smelling-of-smoke back room a group of men in cow-boy boots plot to subvert public will and divvy up Colorado’s water for themselves. I don’t operate at the highest levels of decision-making so maybe I’m ignorant, but this version of real-ity falls flat to me. I have a hard time believing there is not a true desire to create engaged stewards out of the water-using public.

Perhaps this line of thinking persists because we have a system of water allocation, transmission, management and protection that requires an engineering or law degree and 15 years of experience to fully comprehend. Yes, water is com-plicated and political and technical. And yes, there is still a lot of work to do to create this state of engaged stewards. But to blame the lack of general understanding on individuals who might be laboring to keep the public in the dark is missing the point as well as an opportunity.

The point is that the water in our streams, lakes and res-ervoirs is owned by the people of Colorado, and as such, Colorado’s water institutions have a responsibility to factor public will into their work. I do not know of a water district gen-eral manager or a utility CEO who would not agree with this. The opportunity is that, given the chance, every individual—

whether a teacher, water treatment plant manager, commercial rafting guide, lab scientist or lawyer—could be a voice for Colorado’s water.

I am convinced that the way to create an aware citizenry that cares for Colorado’s water resources is to empower those who take an interest in it to be effective educators. Lucky for me, I get to lead an organization that is positioned to help accomplish just that.

CFWE is leading a rapidly expanding group that will use 2012 as a launching point for celebrating, educating and involving more fellow Coloradans in water issues. Next year, 2012, marks the anniversary of several important water institutions, including the Colorado Water Conservation Board, Colorado River Water Conservation District, Northern Colorado Water Conservancy District, and Southeastern Colorado Water Conservancy District. CFWE, with the help of others, wants to capitalize on this mile-stone to create momentum that will benefit the water education efforts of organizations across Colorado.

There are many ways to get involved. Use the Water 2012 logo in your organization’s promotions and events. Sign up for the email list to be notified of meetings and happenings. Join a subcommittee that is already working to plan statewide activi-ties, or start your own. Organize local activities that play off the statewide festivities to bring awareness to your work.

I am truly excited about how 2012 has brought so many people together already. This will be Colorado’s Year of Water, and I hope Headwaters’ readers will use it to help overcome the myth that the public is not only invited to be aware and involved in water issues, but encouraged and appreciated. Learn more at www.cfwe.org/2012.

Happy New Year from CFWE, and thank you for the work you do and the support you give us.

Executive Director

H e a d W a t e r s | W i n t e r 2 0 1 1 1


The Colorado Foundation for Water Education is now accepting applications for the 2011 Water Leaders Program. During the year-long course, participants develop their leadership potential, are provided with training in conflict resolu-tion, communication and negotiation skills, and engage in extensive self-assess-ment and networking opportunities. The course is open to any mid-level profes-sional in Colorado with an interest in water resources and career development. Applicants must be able to commit to the following mandatory training dates in Denver: July 14, 2011; August 22-23, 2011; October 3, 2011 (Avon); January 20, 2012; and March 23, 2012. Applications must be received by CFWE by March 15, 2011. Visit cfwe.org for more information and to download application materials.

Rep. Jerry Sonnenberg is the current chair of the Agriculture and Natural Resources Committee in Colorado’s House of Representatives. A Colorado native, Jerry has farmed and ranched on 2,500 acres near Sterling since 1979. Jerry has previously served as a Colorado Farm Bureau board director, a Republican River Conservation District board director and on the Colorado Water Congress policy committee.

Sen. Gail Schwartz is currently the chair of the Colorado Senate Agriculture and Natural Resources Committee. Gail’s background includes ski area planning, consulting for financial institutions and serving as direc-tor of development for the Pitkin County Housing Authority. As a resident of the Roaring Fork Valley for more than 38 years, Gail is a strong advocate for solutions to strengthen local businesses, expand rural healthcare and grow economic opportuni-ties in communities throughout her district.

Alan Matlosz is senior vice president with George K. Baum & Company in Denver. Alan provides investment banking and financial advisory services to local governments and has financed nearly 300 projects in Colorado. Alan’s volunteer activities include the South Metro Denver Chamber of Commerce, the Arapahoe County Retirement Board, the transition team for the city of Centennial, the Government Finance Officers Association, the American Water Works Association and the Colorado Storm Soccer Association.

Trina McGuire-Collier is manager of com-munity relations for Denver Water, where she oversees communications, media, marketing and outreach efforts. Before she joined the utility in 1992, Trina’s work included stints with Kcnc TV News 4, 850KOA NewsRadio, Odyssey West maga-zine and KUVO radio. She is also a former trustee and public information committee chair for the Rocky Mountain Section of the American Water Works Association.

Chris Treese has been the manager of external affairs at the Colorado River District since his hiring in 1991. Chris describes his responsibilities as everything you don’t want engineers and lawyers doing. He regularly represents western Colorado’s water interests and values before the Colorado Legislature, regulatory agencies and Congress. He is currently the president of the Colorado Water Congress and serves on the boards of Club 20 and the National Water Resources Association.

Steve Fearn is a board director for both the Southwestern Conservation District and the Colorado Water Congress and is a member of the Southwest Basin Roundtable. He grew up on a family dairy farm in Colorado but has spent most of his professional career in the metal mining industry in Colorado and abroad. Steve is a registered Professional Engineer in Colorado and lives high among the San Juan Mountains in Silverton.

CFWE Welcomes Six New Board Members in 2011The Colorado Foundation for Water Education is excited to welcome:

2011 Water Leaders Program

The Colorado Foundation for Water Education would also like to thank Sen. Mary Hodge, Sen. Bruce Whitehead, Rep. Randy Fischer, Matt Cook, Tom Cech and the late Dale Mitchell for their service, which ended in December 2010. They all made significant contributions to strengthen CFWE.

The 2010 Water Leaders class celebrates at its graduation dinner in Vail.


Duringthe conception phase of this issue of Headwaters, the question was raised, “How does the “ecosystem

services” approach differ from the types of conservation initia-tives that are already mainstream?” The difference, though subtle, is largely related to motivation. The idea behind ecosys-tem services is that, no matter who you are, you need nature to keep doing its job or your life could go downhill, fast. Nature provides everything from the water that flows down from the mountains, to the microorganisms that keep soil fertile. Of course, there’s infinitely more that goes into making life good or the Earth’s systems sustainable. But the motivation is one of keeping the Earth ship running. After all, we need it!

For me, this point was brought home when I stumbled across an experiment conducted in 1991 to evaluate space colonization technology. Eight people were sealed inside a 3.14-acre closed “biosphere,” simulating the Earth, for two years. Five different natural ecosystem types, plus agricultural land, were replicated inside this glass-walled enclosure, with more than $200 million invested in its design and construction. However, during the experiment, the “atmosphere,” as well as many other parts of the system, went haywire. Pest species flourished while the pollinators and many vertebrate species did not survive. Apparently, the complicated processes and delicate balance of life on Earth are not easily re-created.

I’m not planning on jumping ship anytime soon, and even in the middle of winter, it is hard to imagine this wonderful,

blue-skied, mountainous state one day rendered inhospitable to humans. People with far less technology, after all, survived much more rugged circumstances than we find ourselves up against today. Or am I deceived? Certainly, technology provides a cushion, a buffer, to what it would really mean to survive a Colorado winter (or farm a Colorado summer) today. And complicated water delivery systems have made it pos-sible for more than five million of us to live in Colorado’s arid climate. But, what if, acting short-sightedly, we pushed the sys-tem too far? Is it conceivable that we could actually fail? Recent movies, ranging from “WALL-E,” where a spaceship-bound civilization has all but given up on the possibility of life on Earth, to “Avatar,” where humans have set up shop on another planet to extract needed resources, reveal that as a society, we have collectively wondered at times where we are headed.

Ultimately, the future is all about choices. And having enough information to make good ones. To the extent that the field of ecosystem services will be able to provide that informa-tion, encourage the necessary policy and funding connections and affect decision-making, it will extend traditional conserva-tion’s reach.

Read on to discover the synergy made possible when humans work to build on and bolster what the Earth is already designed to do. Perhaps nature really is the best partner after all.

Biosphere 2, located near Tucson, Arizona, was built to emulate natural ecosystems and facilitate research and development of space colonization technology. Two missions in the 1990s sealed “Biospherians” inside the glass enclosure to evaluate survivability. It is now used by the University of Arizona for climate change experiments.

EditorJayla Poppleton


Why conservationists are translating “environmental integrity”

The great wonder of the blue planet is that life is made possible. From forests that regulate the water cycle and the climate, to wetlands that cycle nutrients and act as natural filtration systems, to bats and butterflies

and bees that pollinate crops that we harvest for food, the complex interactions that occur within living ecosystems pro-vide essential services that directly support, not only our very existence, but our quality of life and our livelihoods as well. While as a species, Homo sapiens have grasped at some level the need to harvest the Earth’s resources sustainably, to con-serve biodiversity for future unknowns, and to stabilize the cli-mate, the question remains: Have we truly accepted our utter dependence on the continued persistence of Earth’s diverse ecosystems, in all their amazing complexity?

Although the concept of this dependence and the need to pro-tect these natural systems for their related functions and values isn’t new, there is a growing cadre of natural and social scientists and economists who have joined forces to promote a slightly altered version of conservation, tapping an instinct greater than philanthropy or moral imperatives: that of human survival and well-being.

Groups like The Nature Conservancy, the largest conserva-tion organization in the world, have already established projects worldwide related to investing in ecosystems for outcomes

intended to benefit humans. In doing so, they are helping entities ranging from corporations to countries to choose policies and courses of action that take into account the tremendous value inherent in “natural capital,” a value that lacks recognition on tra-ditional economic ledgers.

One prominent partnership in the field lists The Nature Conservancy, the World Wildlife Fund, the Woods Institute for the Environment at Stanford University and the University of Minnesota’s Institute on the Environment as members. Four years ago, they formed the Natural Capital Project, which aims to align economic forces with conservation. To encourage investment in nature, the Natural Capital Project is working on tools that would help quantify the value of that investment for a given community and calculate a foreseeable return. The aim is to help decision-makers assess the tradeoffs related to competing land uses or management plans and their impacts to the environment, and ultimately, society.

It’s important because, so far, despite all of our great strides toward conservation, we haven’t successfully halted environ-mental degradation. And we haven’t identified the tipping points where ecosystems could suddenly cease to function in a life-sustaining way.

According to the Millennium Ecosystem Assessment, com-pleted in 2005 by a consortium of global organizations, 60 per-

The Power of ecosysTem servicesKe

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The south fork of the Platte River meanders through South Park, near Antero Reservoir in the 63 Ranch State Wildlife Area.

H e a d W a t e r s | W i n t e r 2 0 1 1 5 H e a d W a t e r s | W i n t e r 2 0 1 1 5

The Power of ecosysTem servicescent of the 24 types of services it assessed globally have been degraded or used unsustainably, often times as a result of deci-sions made to increase another service, such as food production. Members of the Natural Capital Project would argue that such losses represent the depletion of natural capital assets that could arguably be a better indicator of a nation’s future economic health than the traditional measure of its gross national product. So, a nation may register significant economic gains, but if it used its resources unsustainably to achieve that, the story is only half-told.

The Millennium Ecosystem Assessment was a vast report assess-ing the state of the world’s ecosys-tems and the consequences of their degradation on human well-being. The assessment mainstreamed the term “ecosystem services” and defined four sub-categories of services, including provisioning services like food, water and timber; regulating services affecting climate, floods and water quality; cultural services such as recreation and aesthetic enjoyment; and supporting services including soil formation and nutrient cycling. Notably, the assessment did not consider human beings to be separate from ecosystems, but to be inte-gral parts of them. So, humans are both the pawn and the chess

player, directly and indirectly altering the environment through our actions, then reaping the consequences.

The fundamental issue according to John Sanderson, who co-directs The Nature Conservancy of Colorado’s Center for Conservation Science and Strategy, is that the value of eco-system services is not internalized in our economic system. Society doesn’t pay the true costs of using these services, at least not today, and not in cash. Future generations may be the

ones who “pay” the consequences of today’s decisions when they inherit depleted fisheries, deforested water-sheds or dewatered rivers. So far, government hasn’t resolved this dis-crepancy; many conservationists feel the U.S. regulatory framework for protecting the environment doesn’t

come close to integrating the true value of ecosystems into resource development decisions.

Some argue that not only are many of the common pool resources provided by natural systems lacking mechanisms to generate the finances necessary to conserve them, but that humans, through urbanization and technology, are increas-ingly ignorant of—and even sheltered from—our dependence on them. Like the Slow Food movement that is re-connecting

By Jayla Poppleton

Ecosystem: A system made up of plants, animals, microorganisms, soil, rocks, minerals, water sources and the local atmosphere interacting with one another.Source: Biology Online

to read “human quality of life”


people to the sources of their food and inspiring awareness of how food choices affect the world, ecosystem service proponents want people to recognize that everything we use and value inherently comes from ecosystems. That recogni-tion will help us get the balance sheet right in terms of our value system, says Rebecca Goldman, who previously served as The Nature Conservancy’s liaison to the Natural Capital Project and now works for the Washington, D.C.-based Inter-American Development Bank.

Then, “The onus is on policy makers to recognize the value and set up policies and mechanisms to help get that value expressed in our economic system,” says Sanderson.

The ecosystem services framework that is being embraced by some scientists and conservationists is a move beyond traditional conservation arguments that point to the “intrinsic value” of an ecosystem—that it should be protected for the sake of its own existence. The shift has provided an entry point into conservation for new players, who have also brought along new sources of funding—both important goals of the movement.

While completing a doctorate in ecosystem services at Stanford University, Goldman performed an extensive analy-sis of 60 of The Nature Conservancy’s thousands of projects around the world. In comparing projects with traditional biodiversity conservation goals to those also incorporating an emphasis on ecosystem services, Goldman found that projects with the dual focus not only brought new types of landscapes into the fold—agricultural primarily—but also involved more stakeholders—private landowners—and received significantly greater funding from private, corpo-rate sources.

The concept of promoting conservation as a “your life as you know it depends on this” activity makes sense. By pointing people—some of whom may not have embraced the intrinsic arguments—toward concrete, tangible services such as the pro-vision of clean drinking water or flood protection, the motivation to protect healthy, functioning ecosystems should become more widespread. Given the breadth of affected people and entities, if that motivation can be translated into much-needed financing, it could affect every niche of resource management.

Ecosystem services occur at scales crossing, at the very least, private property lines and jurisdictional boundaries, and some-times nations, continents, or, in the case of climate regulation, the globe. Thus, conservation scientists and practitioners see a need for thinking system-wide and implementing new policies and regulations to stem the tide of environmental degradation. Both the beneficiaries of a service as well as those whose actions degrade it are currently being tapped as possible sources of pay-ment to both protect and recover services.

Some individual entities are moving in the same direction based on their own recognition of the potential consequences of inaction or the opportunity for green-marketing. Coca-Cola, for example, has worked with The Nature Conservancy to calculate its “water footprint,” the total water used in its Coke production process, all the way from the Dutch sugar beet farm to the can. The company will use the information to reduce its water con-sumption and offset its water use by returning water to ecosys-tems, similar to the consumer who voluntarily purchases carbon-offset credits to atone for his or her portion of carbon emitted during a given activity, like flying cross-country.

Closer to home, the Natural Resources Conservation Service has worked for decades with Colorado’s agricultural community to promote good stewardship. It is now begin-

ning to work on forested properties as well. Currently, the organization estimates it is working with 75 percent of private landowners in Colorado who are agricultural producers, all on a voluntary basis. By encouraging everything from no-till farming and crop rotation to protect soil productivity, to stream bank stabilization and restoration of riparian areas, the service exemplifies words spoken by its first chief, Hugh Hammond Bennett: “If we take care of the land, it will take care of us.” But while the service is able to calculate an economic return on certain investments, like changing from conventional tillage to no-till, other values are, again, harder to estimate. “If you’re going to do stream restoration, how do you value the habitat of that fishery?” asks Eugene Backhaus, a natural resource man-agement consultant from the agency’s Lakewood office. “Or if a catastrophic fire comes through, and we don’t get this work done, what is the lost value of that?”

As many of Colorado’s key water leaders continue to plod through the painstaking task of evaluating the state’s future water needs out to 2050, through the Colorado Water for the 21st Century process initiated five years ago by the state Legislature, the concept of ecosystem services hasn’t taken hold as forcefully as some would hope. When it comes to the value of water, its direct economic contributions measured in dollars and cents still favor the industries that extract, transfer and often consume the resource—everyone from municipal users to agricultural producers to brewer-ies. The value associated with the non-consumptive uses of water—whose beneficiaries include both native and sport fishes and the ecosystems they exist in, as well as towns and counties boasting scenic and recreational amenities—is much harder to quantify, but no less important to the liveli-hoods and lifestyles of Coloradans.

The opportunity to balance economic development related to the production value of water right alongside keeping water in rivers for the sake of ecosystem services, whether they be habi-tat- related or culturally important, is something Sanderson hopes will not be lost on the current water supply planning process. As hard as it may be to capture the true cultural and aesthetic value of protecting water in rivers, Sanderson believes “we need to be thinking long term about what we really value about Colorado and trying to make sure we don’t sacrifice this tremendous, unquantifiable value for short-term economic gain.”

As the science of ecosystems continues to mature, those holding the microscope only become more awed by, even baffled by, Mother Nature’s grand complexity. And the truths we embrace in a given time period may unravel as that time passes and the consequences of our actions unfold. “We think we’re managing for one outcome that we think today is a very good outcome,” explains Sanderson. “And then in fifty years, we realize, ‘Oops.’”

Such mistakes, whether due to misunderstanding, judg-ment errors or skewed priorities, may or may not be reversible. Substituting a degraded ecosystem service with a technological solution, the concept of fungibility, is not always possible. Better to maintain nature’s services, says Goldman, by giving people the option to make choices based on full knowledge and recognition of where everything’s coming from.

“Ecosystem services are just one way of demonstrating nature’s values,” says Goldman. “Ecosystems have all been modified to some extent. But the more we can maintain their component pieces, I think the greater chance we have of those ecosystems surviving into the future, particularly with the unpre-dictable impacts from climate change.” q

…ecosystem service proponents want people to recognize that everything we use and value inherently comes from ecosystems.

On August 29, 2005, Hurricane Katrina stormed into the Gulf of Mexico, ravaging coastal communities with gale-force winds and sheets of rain. The tempest would prove to be the second deadliest hurricane in American history. More than 1,800 people died, and thousands more were displaced or left stranded for days amidst

threatening floods. Much of the destruction occurred in New Orleans, where floods breached the city’s levees and the system failed catastrophically. All told, the hurricane caused an estimated $81 billion in damages.

Nearly as tragic was the fact that much of the destruction might have been prevented. Immediately after the hurricane, experts pointed to the loss of roughly one million acres of coastal wetlands as the major chink in the regional armor. Rather than absorbing rain and wind, buffering the wrath of the storm and protecting nearby land and communities, what remained of the wetlands was battered into smithereens. Had the wet-lands’ flood protection value been calculated long before a web of canals were built through them to accommodate the shipping and oil industries and flood control measures cut them off from the Mississippi River’s natural sedimentation, it is possible that the land would have been more valuable in its natural state than as commercial and industrial real estate.

Unfortunately, it took the dramatic consequences of the hurricane to make that apparent. In ecological jargon, the protection those wetlands originally provided is known as an ecosystem service, a valuable role played by nature that offers extraordinary benefits to humans. Clean air. Medicinal plants. Recreational opportunities. Flood protection. Water filtra-tion. Nutrient cycling.

These services are so ubiquitous, such an inherent part of the world we inhabit, that for decades they were all but completely taken for grant-ed. Development, extraction of oil, gas, and metals, burning of fossil fuels, and scores of other human actions have degraded ecosystems, setting the stage for very expensive treatment processes or highlighting the critical need for environmental restoration. In the words of Joni Mitchell, often you “don’t know what you’ve got till it’s gone.” Now that many of these services have been compromised and the consequences felt, a growing trend is taking root to recognize, value and protect ecosystems before their natural functions are lost.

Identifying ecosystem services and forming restoration efforts around them—essentially making anthropogenic arguments in favor of conserva-tion—may seem mercenary compared to save the whales campaigns of yesteryear, but in actuality, such efforts offer a pragmatic perspective that creates more buy-in from a variety of stakeholders. Unlikely partnerships are sprouting between for-profit industries, many of which for years have been suspect to the environmental community, and the environmentalist. For instance, The Nature Conservancy is working with Bavaria, the largest brewery in Colombia, to help preserve the watershed that serves Bogotá, the country’s capital.

With its headwaters located in Chingaza National Park, Bogotá’s water supply emerges at its source clean and pure. But as it travels to the thirsty city, population roughly 7 million, the Chingaza River and its tributaries face an assault from logging, farming and other human activi-ties that clog the waterways with sediment, metals and nutrients. The water arrives so polluted that the costs of treating it for drinking water have skyrocketed. Those costs are ultimately passed on to water users, one of the biggest being Bavaria Brewery. This results in a noticeable

By Rachel Odell Walker

it’s Not Too LateTo recognize and embrace nature’s inherent value

Hurricane Katrina pictured just before making landfall. NASA Photo.

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reduction of the brewery’s profits. The Nature Conservancy demonstrat-

ed that by contributing to a watershed conservation fund that would invest proactively in watershed protection, Bogotá’s water utility could save $4.5 million annually. Water users would ulti-mately benefit from supporting land use practices that could reduce sedimenta-tion in the water by 2 million tons a year. Businesses would recoup their invest-ment in four to five years, according to the Conservancy. The pitch worked. Bavaria Brewery joined the cause along with other private companies.

Presenting conservation as an invest-ment—and not just an altruistic act—is giving rise to public and private part-nerships aiming to provide funding to maintain or restore ecosystem services, such as those rendered by an intact watershed. According to the March 2010 issue of Wired magazine, some of these creative arrangements are helping not only to put water back in rivers, but to improve water quality. For instance, new regulations in the Pacific Northwest allow industrial operatives such as paper mills, whose activities can raise water temperatures, to “offset their actions by investing in nature’s ability to cool the water. Instead of spending tens of millions of dollars to build cooling tow-ers, companies might contract with local conservation groups to restore stream-side vegetation that naturally lowers the water temperature and shores up habitat for cool-water fish.”

Employing ecosystems to protect water qualityIn Colorado, protecting ecosystems for their ability to filter and sequester nutrients is likely to become a high priority once the state adopts criteria regulating nutrient levels in open water bodies and streams. As mandated by the Environmental Protection Agency, Colorado’s Water Quality Control Commission will set criteria for phos-phorous and nitrogen in 2012.

Excessive nutrients can lead to pro-lific algal blooms that choke the oxygen from water and render aquatic envi-ronments nearly sterile and hostile to fish. Algal blooms not only threaten the ecological integrity of water bodies, they necessitate extensive—and expen-sive—drinking water treatment, says Dr. Jim Loftis, professor of civil and envi-ronmental engineering at Colorado State University. Water with significant organic matter requires more intense treatment to disinfect. Some of the byproducts of the disinfection process are known car-

cinogens and are regulated by the EPA, so treatment plants will need to invest more money to comply with the criteria that govern their release. “Nutrients are probably the main headache of water treatment managers,” says Loftis.

Perhaps surprisingly, inflated levels of nitrogen and phosphorous don’t stem just from human-applied fertilizers and detergents, though that is one source. These naturally-occurring nutrients are “everywhere,” says Loftis. “Anyplace there is soil, there are nitrogen and phosphorous, and if you fertilize the soil to grow crops, there’s more. They are released from wastewater treatment plants. Anywhere there is human activity there is an increase in nutrients.”

Because these nutrients are found in soils, human disturbances, such as min-ing or deforestation, also play a role by inducing soil erosion. Soil eroding from a road cut, for example, carries nutrients with it into rivers and streams.

While eliminating nutrients altogeth-er would be impossible, not to mention undesirable—they are an essential input to natural systems—reducing their unnatural prevalence in water bodies can be accom-plished in a number of ways. Upgrading wastewater treatment plants, preventing agricultural runoff, and keeping urban run-off or polluted storm water from reaching streams and rivers are all possible meth-ods of reducing nutrient pollution. Another solution is to use wetlands as buffers to absorb and retain nutrients.

In Bear Creek Lake, outside of Morrison, recent restoration efforts focused on stabilizing the reservoir’s banks and preventing them from erod-ing, which has led to a measurable reduction in nutrients in the lake, says Russell Clayshulte, a water consultant working on the project on behalf of the city of Lakewood. Along with the U.S. Army Corps of Engineers, in 2007, the city spearheaded the restoration of a section of the reservoir that was an eighth of a mile long. After installing five stabilization structures, building wet-lands and planting trees, they measured nutrients in the water and compared them to pre-restoration levels. Before, the eroding sediments were bringing an average of 20 pounds of phosphorus and 200 pounds of nitrogen into the reservoir each month. The year after construction, those numbers dropped to 4 pounds of phosphorus and 125 pounds of nitrogen per month. Over the past two years, Clayshulte says the amount of nutrients has increased, likely as a result of housing development upstream of the reservoir and more storm events.

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the main headache of

water treatment managers.”

—Jim Loftis,Professor, Colorado State University


Nevertheless, he says the restoration provided measurable benefits and added that the new wetland is likely absorbing much of the increased nutrients from the development.

Even though the cost of wetland restoration can range from several thousand to millions of dollars, upgrading the state’s wastewater treatment plants to meet the yet-unspecified nutri-ent criteria could be prohibitive to small plants serving rural customers, says Nancy Keller, regulation compliance special-ist for the city of Pueblo. Estimates for the financial impact to Colorado from the nutrient criteria standards are hard to come by because the rule-making process isn’t complete. But Keller points to a similar criteria-setting process in Florida that required some wastewater treatment plants to pay up to $5 bil-lion in upgrades to meet the new regulations.

“If the standards here are similar, many wastewater facilities will have to go to reverse osmosis treatment, which consumes huge amounts of electricity, releases significantly more green-house gases and will have a toxic brine that will need to be disposed of,” says Keller. “It will be tremendously expensive.” Those costs will most likely be passed on to customers in the form of higher sewer and water rates.

Given the projected expense, finding opportunities in nature that will keep nutrients from pouring into the waterways is an attractive option that is likely to play a large role once municipalities and treatment plants take action to conform to the new regulations, says water consultant Rob Buirgy.

With 80 percent of the earth’s atmosphere consisting of nitrogen, and with the prevalence of nitrogen-fixing life forms that easily convert that into usable nitrogen, controlling nitro-gen through ecosystem services restoration is challenging. However, phosphorus, which is found in soils and decom-posed plant matter as well as animal waste and artificial fertil-izers, is easier to manage, Buirgy says. Most nutrient-related

pollution problems in Colorado are phosphorus-dependent, so controlling phosphorus will likely have a direct beneficial effect.

“A healthy natural system does a great job of sequestering phosphorus in soil and living organisms,” says Buirgy. “Any free phosphorus will most likely be taken up by growing plants and incorporated into the natural cycle.” In other words, a func-tioning, healthy wetland will trap phosphorus while concrete ditches, along with roads, driveways, and houses, will let the nutrients flow over them and into the water supply.

“You’ll see phosphorus moving through a developed landscape in far greater amounts than through a ‘natural’ land-scape,” says Buirgy. “Consequently, in almost every case, a functioning ecosystem will go a long way toward addressing the nutrient issue.”

Salvaging a water sourceOne Front Range water body that stands to benefit from the nutrient criteria is Standley Lake, which provides water year-round to the cities of Westminster, Thornton and Northglenn and is a popular recreational destination. Standley Lake’s sto-ried water quality history dates back to the early 1960s when severe taste and odor problems led to public protests. In the years that followed, the taste and smell problems were linked in part to high levels of nitrogen and phosphorus that were feeding extensive algal blooms in the lake. The algae also con-tributed to low levels of dissolved oxygen, to the detriment of local fish species. There were many nutrient sources: wastewa-ter effluent discharged upstream by Coors Brewing Company, unlined 100-year-old canals that were leaching nutrients into the water supply, and storm water runoff from upstream roads and mines. An extensive clean-up effort ensued.

In the 50 years since the original problems surfaced, the three cities, along with partners throughout the Clear Creek

Water consultant Russell Clayshulte (right) and Tony Langowski of the Evergreen Metropolitan District sample a small tributary on Bear Creek for E-coli contamination. Clayshulte helped secure funding with the city of Lakewood to restore a tributary to Bear Creek Lake, a reservoir along C-470.

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Watershed, which envelops Standley Lake, have taken dras-tic and effective steps to reduce nutrient levels in the lake. In addition to technological solutions—rerouting the Coors discharge and adding treatments to remove phosphorus from the upstream wastewater treatment plants’ effluent—cities and groups like the Upper Clear Creek Watershed Association have remediated mining sites and built wetlands to reduce the amount of storm water and pollutants running directly into the water system. Their efforts have paid off.

“Nutrient loading in Standley Lake was a very significant problem,” says Mary Fabisiak, the city of Westminster’s water quality administrator. “It isn’t a problem now, but we need to maintain this status quo. We do not want the water quality to deteriorate.”

For Standley Lake, a nutrient-loading relapse would herald a return of the water quality issues of years past and could force Westminster, Thornton and Northglenn to abandon it as a water supply. That would be astronomically expensive—Westminster has estimated that replacing its water system alone would cost $480 million, according to a report published in 2010 by the three cities that rely on Standley Lake for drinking water.

Although Standley Lake’s current, site-specific standards are likely more restrictive than what the state will ultimately implement, the lake gets some of its water from outside the Clear Creek Watershed, both from Denver Water’s supply and from Coal Creek. Water quality improvements in those water-sheds would be passed along, as would further reductions to nutrient levels in treated wastewater.

Loftis thinks failure to implement sufficient criteria could result in “a slow degradation of water quality that would result in extremely high water treatment costs over time.” He points to California’s Lake Tahoe, which has no nutrient criteria and is essentially sterile due to low dissolved oxygen, as an indication that the slow process of decline can have dramatic impacts down the road. And, unchecked nutrient levels could have a compound-ing impact on rivers and aquatic life around the country.

“Any excessive nutrients that leach out of the watershed and make it to, say, the Gulf of Mexico via the Arkansas River would be bad,” says Loftis. Nutrient enrichment in estuaries often results in dead, or hypoxic, zones that are so oxygen

deficient they are nearly devoid of aquatic life. In the Gulf of Mexico, at the mouth of the Mississippi River, one of the larg-est dead zones in the world fluctuates in size corresponding to seasonal farming practices and storm events.

How do we value ecosystems?While problems in a drinking water supply or the inability of an ecosystem to support life would trigger a reaction from most people, some services are less visible. In the absence of a direct, monetary value, people often have a harder time recognizing or appreciating the importance of some valuable ecosystem functions. Pam Kaval is an ecological economist who specializes in valuing ecosystem services. She believes most Coloradans understand the value of having a healthy fish population in a popular fly fishing stream, for example. But other services provided by a healthy stream, such as the wildlife communities supported by clean water or the water fil-tration facilitated by functioning wetlands, are less recognized.

“When you’re looking at the role a stream plays in a system, you get a more complete assessment when you add informa-tion about all the life that stream supports and the roles it plays,” says Kaval. “This is important for policy makers, sure, but it affects everybody.” For instance, protecting habitat to support native wildlife populations can draw tourists and recre-ationists, which has financial benefits to surrounding commu-nities. Essentially, protecting ecosystem services means talking about restoration and its impacts in financial terms in order to explain the benefits to a universal audience, says Kaval.

“People want to know the bottom line, in dollars,” she says. “It is easier to talk dollars instead of saying, ‘Two feet of soil will have x level of impact and improve the nutrient levels by x percent.’ That doesn’t mean a lot to someone who doesn’t understand the science. So even though there’s a value to adding soil, for example, to be able to say that adding soil improves something by $50 an acre is much more effective.”

In this world where money talks, perhaps valuing ecosys-tems economically will help us heed the harbingers of ecosys-tem disturbances like that of New Orleans and its sacrificed wetlands before those sacrifices add up to more than we bargained for. q

At the mouth of the Mississippi River, where nutrient-laden sediments flowing into the Gulf of Mexico can be seen from space, a dead zone of oxygen-depleted water forms as small organisms called phytoplankton decay. Blooms of the phytoplankton, or algae, grow rapidly with the increase in available nutrients and are thought to be responsible for the green and light blue water colors seen in the photo above.

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Long before accelerated climate change, epidemic pine-beetle infestations and unprecedented population growth threatened to change the Western way of life, the framers of the 1897 Organic Act understood the connec-tion between a healthy forest and a quality water supply. The purposes they hoped to achieve through the inaugurated Forest Reserves, which preceded the National Forest system, included “securing favorable conditions of water flows.”

Rocky Mountain Regional Forester Rick Cables wants to bring water back to the fore-front of the United States Forest Service’s charge. “I think that the value of water as we move forward into this century is going to increase exponentially,” he says, “It’s already huge, and people don’t necessarily understand that.”

As population grows in the Interior West, the arid region is also expected to be hard-hit by climate change, Cables says. “That’s pretty spooky. We have to be thinking ahead.”

Mike Anderson, senior resource analyst with The Wilderness Society, echoes Cables’ concerns, noting that declining water supplies during parts of the year coupled with ris-ing demand for water will require some careful planning.

With such changes on the horizon, maintaining healthy forested watersheds will be essential. Not only do forested ecosystems provide filtration services, they also serve to lock in the soil, preventing the migration of sediments that can clog waterways and water supply infrastructure. In addition, by absorbing and slowing the path of rainfall, forests mitigate floods, protecting stream and river channels from erosion. As water moves through the forest, pollutants such as metals, viruses, oils, excess nutrients and sediments filter out.

Maintaining these natural functions, says Joan Carlson, a water quality hydrologist with the Forest Service, is preferable to restoring a system that can no longer function after years of poor management, whatever the system may be. “Keeping these processes going is a lot easier than trying to clean the water later.”

from foreststo faucets

Wetlands in the Gunnison National Forest. Photo © Mike Norton/iStock.com

By Emily Palm

H e a d W a t e r s | W i n t e r 2 0 1 1 1 1


Connecting water providers to the forestEight years ago, on a bus ride home from an Earth Day field trip on the South Platte River, Cables chatted up the idea of collabo-rating on a watershed health project with former Denver Water chief Chips Barry. “I sort of nudged him and said, ‘Hey Chips, wouldn’t it be cool if we could somehow connect your water users to their watersheds in a manner that would allow them to invest in the watershed and allow us to maintain it in a healthy state?’” Cables recalls.

That idea transpired in August 2010 when Denver Water—which serves 1.3 million people—and the Forest Service entered into a five-year, $33 million partnership called Forest to Faucet. The partnership will consist of projects to improve the health and resiliency of five watersheds spanning 38,000 acres of Colorado’s National Forest lands—the Upper South Platte, South Platte River Headwaters, St. Vrain River, Colorado River Headwaters and Blue River watersheds—which supply the vast majority of Denver Water’s drinking water. Each agency will contribute $16.5 million. The cost to the average Denver Water ratepayer is expected to be $27 over the course of five years.

During the first five years of the partnership, activities will revolve around reducing wildfire risk through forest health treatments such as thinning trees and applying prescribed fire. Claire Harper, regional water partnerships coordinator for the Forest Service, says the agency, which is restricted from enter-ing agreements longer than five years, views the partnership’s initial memorandum of understanding as setting the stage for a longer-term program. If both entities choose to move forward, they will pursue additional goals that include restoring areas still recovering from past wildfires and minimizing erosion and the sedimentation of reservoirs. Projects could include tree planting, riparian vegetation improvements as well as decommissioning and improving roads and reclaiming mines.

Regardless of which projects the partnership tackles, Anderson hopes they will be performed in a way that doesn’t defeat the purpose. Work crews should be especially careful around ripar-ian areas and on fragile soils, he cautions, noting that ground equipment can cause erosion that pushes sediment into streams. Anderson would ideally like to see citizens’ advisory groups help design activities and ensure projects are completed in an environ-mentally sensitive manner.

In addition to lessening the risk of a catastrophic fire, thinning and removing dead trees will mitigate another major threat on the horizon: falling trees. “It’s almost as if you can see the hur-ricane three years out,” Cables says, calculating that an average of 100,000 trees killed by pine beetles will fall every day for 10 years. Trees could fall on water transmission facilities like ditches and pipelines. Fallen trees could also close roads or divert drainage patterns designed for roads and trails, causing water to pool and erode the road base and increase sedimentation, says Cables.

Engaging in forest stewardship for the purpose of its water may not be revolutionary, but garnering financial support from a watershed’s direct beneficiaries to pay for explicit investment in health initiatives on public land is a relatively new concept. Similar arrangements—sometimes called user contribution or payment for ecosystem services programs—like one in New York’s Catskill Mountains and another in Santa Fe, New Mexico, are among those breaking trail in a demonstrably effective direction, with others catching on.

What makes Denver Water and the Forest Service’s Forest to Faucet partnership unique among similar programs is its scale. Santa Fe’s project, which Harper looked to as a model, involves one watershed in one forest, while Forest to Faucet’s five priority watersheds span three forests and six ranger districts.

The Forest Service hopes the partnership will serve as a model

“…wouldn’t it be cool if we could somehow connect your water users to their watersheds in a manner that would allow them to

invest in the watershed and allow us to maintain it in a

healthy state?”—Rick Cables speaking to Chips Barry

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it can expand to other utilities. According to the agency, nearly 90 percent of the 14.5 million acres of National Forest lands in Colorado lie in watersheds that contribute to public water sup-plies. And the benefits of caring for Colorado’s ecosystems extend beyond the Rockies: Colorado’s headwaters provide surface water to more than 30 million Americans in 18 states.

“I think we have a special responsibility in this region because we have the high headwaters. There’s no real comparable example of a headwaters of that scale with that reach anywhere in the country,” Cables says.

By entering financial partnerships and focusing on priority watersheds for utilities, the agency will have greater resources to address high-risk zones upslope of water reservoirs and intakes. What the partnership is really doing is expanding and accelerat-ing that work, Harper says.

It makes sense for Denver Water, too. “We’re in the watershed business,” says Don Kennedy, an environmental scientist for the utility, noting that when the Buffalo Creek fire burned 12,000 acres in the South Platte watershed, Denver Water realized it needed to take more ownership of forest health.

In the wake of the 1996 Buffalo Creek and 2002 Hayman fires, Denver Water has racked up more than $11 million in expenses. The agency’s bill, ultimately expected to exceed $40 million, includes dredging Strontia Springs Reservoir, where the tide of sediment and debris flowing from the burned forests has not let up. “It hasn’t gone away, it keeps accumulating,” Kennedy says.

Strategically investing in Colorado’s watersheds If Denver Water and the Forest Service’s Forest to Faucet repre-sents a 5,000-foot view of the watersheds that Denver taps, the Colorado Statewide Forest Resource Assessment and Strategy takes a 30,000-foot view of the entire state. Completed by the Colorado State Forest Service in June 2010, the statewide assess-ment and accompanying strategy were mandated by the 2008 Farm Bill.

The assessment provided a spatial overview of Colorado’s forests and identified priority areas for focusing resources. “If we have limited resources, you want to spend those resources where you have the greatest opportunity to make a meaningful differ-ence,” says Joe Duda, who supervises the state forests’ manage-ment division and took the lead on the assessment and strategy.

Among the emphases on watershed health, the assessment stressed protecting soil and preventing erosion, enhancing soil moisture storage and groundwater recharge, reducing flooding, filtering contaminants and maintaining the plant communities that contribute to this process.

“We also looked at opportunities where we could leverage resources,” Duda says, noting the agency also plans to work with private landowners that have landholdings in areas that affect the watershed. “The first thing we want to do is address the priority watersheds,” Duda says, “But we want to do it in a way that is not just a piecemeal strategy, so what we’re doing can effect meaning-ful change on the landscape.”

Forest managers in 1897 may have recognized the need for securing favorable water flows, but surely they could not have pre-dicted the fragmentation of the natural and urban worlds. Some people living in modern, urban society think their milk comes from Safeway, two-by-fours from Home Depot, and water from their faucets, Cables says. “I would love to connect people to the national forest and mountains in a way that they would under-stand. I think that would be a wonderful thing to accomplish.”

Publicizing forest health projects as avenues to protect water supplies and save ratepayer dollars in the long run might just serve as a first step toward that goal. q

Removing dead trees killed by mountain pine beetles is a major focus for Denver Water and the U.S. Forest Service, who will take on the task together across 38,000 acres in Colorado.

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ecomarketsand the Farm of the Future

By Joshua Zaffos


Terry Fankhauser is one of those rare breeds of people who seem at ease talking

about both livestock production and wildlife conservation whether speaking to ranchers or environmentalists. With his handlebar mustache and cowboy hat, Fankhauser displays his roots: He grew up in the Flint Hills of Kansas on his family’s ranch, but after completing a graduate degree in animal sciences at Kansas State University, returning home wasn’t an option. The family livestock operation didn’t generate enough money to support sev-eral generations. Instead, Fankhauser came west and took a job with the

Colorado Cattlemen’s Association. Today, as the association’s executive vice president, Fankhauser represents the oldest—and one of the most innovative—orga-

nized statewide groups of ranchers in the country. Founded in 1867, the Colorado Cattlemen’s Association works to

promote the interests of the beef industry, but it has also recognized the inherent benefit in conserving the state’s

land and water resources. The Colorado Cattlemen’s Agricultural Land Trust, which was among the first of its kind, has helped permanently protect more than 350,000 acres of working farms and ranches in the state from development since 1995.

Now, Fankhauser is heading up a new, spin-off organization called Partners for Western Conservation. The independent, nonprofit group’s

purpose is to develop market-based projects that


could benefit both business and conser-vation. Its programs will provide incen-tives to private landowners and regu-lated industries to protect wildlife and water resources, while helping to offset the costs of managing private lands to meet the conditions of regulatory laws, such as the Endangered Species Act. Fankhauser and others are promoting the view that the 31 million acres of pri-vate, agricultural land in Colorado pro-vide “ecosystem services”—biodiversity conservation, water quality protection, carbon storage, to name a few—that should have a market value. “We see private lands as the huge, untapped reservoir,” Fankhauser says.

A handful of other initiatives in the state are also aiming to establish mar-kets that will pay landowners to protect and restore wetlands, floodplains and endangered species habitat, offsetting damages resulting from development and providing a supplementary source of income for struggling farmers and ranchers. Global carbon markets used to mitigate emissions contributing to cli-mate change are similar experiments, at a much larger scale.

The surge in Colorado toward envi-ronmental markets and payment for eco-system services programs is part of a larger movement across the country and the globe to create financial incentives that promote economically sound land management and environmentally sound development. For Colorado and the West, market boosters say such programs could also help reverse trends and make family farms sustainable and profitable again.

“I see an opportunity to diversify a ranch operation and create a more sus-tainable entity that not only sells beef, but

may also market other tangible offerings, in the nature of habitat or species man-agement,” Fankhauser says. “It’s part of a philosophical shift that needs to happen.”

The economic value of ecosystems Most people who spend time enjoying the outdoors consider nature to be priceless. When we do contemplate the value of Ponderosa pine and aspen forests, gush-ing mountain streams and sagebrush-studded canyon lands, we don’t do so in terms of dollars and cents. But thinking of the environment as sacrosanct and sepa-rate from the economic realm has often meant that impacts to natural resources aren’t adequately, if at all, factored into land-use decisions and development plans, which are typically driven by finan-cial motives. “There’s a disconnect,” says Josh Goldstein, an assistant professor at Colorado State University who studies environmental markets and conservation finance. The concept of ecosystem ser-vices “seems to clash with the moralistic views some people have of nature, but I’m not convinced.”

Goldstein understands some of the heartache over considering the environ-ment in financial terms, but he points out that every decision we make puts an economic value on natural goods and services, whether or not it’s implicit or a conscious choice. If someone buys a cheap piece of furniture made of wood that was clear-cut from a tropical rainfor-est, they are sending a signal that the trees and wildlife habitat of that region aren’t worth very much. Presently, eco-system services, such as air and water filtration, flood and erosion control, fish and wildlife biodiversity, and carbon sequestration, do not influence most

people’s, or company’s, bottom lines.For much of history, this economic

disconnect wasn’t a pressing problem in most of the world because supply out-weighed demand. Humanity had abun-dant natural resources at its disposal, and it seemed far fetched that we could substantially disrupt natural systems. But as populations have grown and industri-alized and our land-use demands have expanded and intensified, we are faced with a declining supply of life-sustaining ecosystem services.

In the July 2010 issue of the science journal Nature, authors Ricardo Bayon and Michael Jenkins, leading proponents of ecosystem marketplaces, write that “an important reason for the alarming rate of environmental destruction across the world is that the true value of eco-systems is largely invisible.” In economic terms, ecosystem services have been externalities, Goldstein explains, societal benefits that don’t factor into prices. It’s a massive market failure: In 1997, another article in Nature estimated global eco-system services provided $33 trillion in benefits, about twice the world’s gross national product at the time.

“Ecosystem services and market-based programs are not a silver bullet for all our problems,” says Goldstein, “but there are places where they can be used effectively.”

Markets stimulated by regulationThe Millennium Ecosystem Assessment, a 2005 assessment of the planet’s eco-logical health published by the United Nations, identified 24 specific ecosystem services in categories including food production, water quality and regulation, erosion control, pollination, waste treat-

Helping landowners, special districts, and water companies acquire, use and protect their water resources for over half a century

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ment, and genetic resources. Market initiatives to tie economics to the protec-tion of three of those services have been the most prevalent, largely because they are the most globally regulated, but also because they are the most visible to key affected stakeholders: biodiversity conservation, watershed services and climate change mitigation.

In the 1970s, the United States first began regulating the degradation and loss of environmental resources through a series of laws. The Clean Air Act, Clean Water Act and Endangered Species Act all take regulatory approaches to pro-tecting and restoring natural resourc-es. Government agencies set limits on pollution levels, loss of wetlands, spe-cies decline and habitat degradation. Constituents must then abide the restric-tions through government-directed rem-edies, regardless of the impacts to their own livelihoods.

Landowners have complained that the laws set up financial disincentives. To have endangered species habitat or wetlands on one’s property prohib-its money-making land uses—grazing, construction, energy development—that may interfere with regulatory goals. Laws, such as the Endangered Specis Act, pit the recovery of a species against the economic well-being of private property owners. Policy analysts have criticized the laws because they promote regulated entities to take the minimum action nec-essary to meet legal standards, instead of investing in innovative practices that could actually exceed the laws’ goals.

“What we’re living with right now is huge regulatory failure,” says Sally Collins, former director of the U.S. Department of Agriculture’s Office of Environmental Markets and past associate chief of the U.S. Forest Service. Collins, who recently left the government and now lives in Lyons and works as a private consultant, says she initially opposed the valuation of ecosystem services and paying to pro-tect endangered species. Her conversion came with the realization that regulatory laws weren’t effectively recovering spe-cies or protecting wetlands.

Among the first experiments with outside-the-box environmental markets was the one for wetland mitigation cred-its triggered by the Clean Water Act in the 1980s. The law requires developers wishing to fill or dredge wetlands to show they are attempting to avoid and minimize damages, and then to offset or mitigate any losses that cannot be curtailed. Mitigation means compensa-tion—creating or enhancing an equal or greater amount of wetlands with similar

functions—opening the door to wetland mitigation banking.

Today, there are more than 400 wet-land banks across the United States, where private landowners and com-panies protect and restore wetlands in order to sell credits to developers who need to offset their damages. In Colorado, the Middle South Platte River Wetlands Mitigation Bank opened for business in 1999. On about 90 acres situated in Boulder County near the town of Frederick, the bank’s owner, David Yardley, and his partners created three types of wetland habitat on former farm-land. Clients have purchased credits to compensate for wetland losses from the construction of schools, roads, shopping centers and subdivisions.

Yardley says the Middle South Platte bank isn’t exactly a cash cow, and he knows of only a couple of other wetland banks that have opened in Colorado. Nationally, however, economists estimate the market in wetland mitigation credits is now worth roughly $2.4 billion a year.

Examples of markets aimed at biodi-versity conservation and wildlife habitat in Colorado are limited, but successful efforts in other states provide a blue-print for how programs here could work. The world’s largest population of the golden-cheeked warbler occurs on the Fort Hood army base in Texas. The bird’s occupied habitat covers nearly a quarter of the military reservation, but since it landed on the federal endan-gered species list in 1992, the Army has had to mitigate any negative impacts to the bird’s population. In the mid-2000s, as the Army was expanding training exercises on the base, the mili-tary teamed up with the Environmental Defense Fund and other governmental and supporting partners to create the Fort Hood Recovery Credit System.

Through this market program, the Army compensates for harming the warbler’s turf by purchasing recovery credits from nearby private landowners, who agree to conserve and manage for appropriate habitat. The system steadily increases the net benefits to the warbler by setting aside 10 percent of available credits each year and conducting trans-actions where the credits ensure more acres are being protected than affected. A March 2010 independent evaluation concluded the three-year program has achieved habitat conservation, facilitated efficient interactions between market participants, and added flexibility to the Endangered Species Act (ESA).

Closer to home, the Environmental Defense Fund is involved with another pilot

“There’s a disconnect,” says Josh Goldstein.The concept of ecosystem services “seems to clash with the moralistic views some people have of nature, but I’m not convinced.”

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market-based project in southern Utah for the Utah prairie dog, which has been listed under the ESA since 1973. Ted Toombs, the regional director for Environmental Defense Fund’s Center for Conservation Incentives, based in Boulder, and a board member of Partners for Western Conservation, says his organization has worked with the Utah Farm Bureau, univer-sity extension staff, local landowners, and state and federal government scientists to build support for the project, which is modeled on the Fort Hood initiative.

The Natural Resources Conservation Service, a branch of the USDA, has supported the effort through its Conservation Innovation Grants pro-gram, established to fund market-based and innovative approaches to land man-agement. The agency has contributed $300,000 as seed money to go toward a first round of credits, which will be used to purchase conservation easements protecting established prairie dog colo-nies on private lands. The credits were scheduled to go on sale to potential buyers, such as developers who have to offset impacts to the prairie dogs, in December 2010, according to Toombs, who adds that the launch will help determine interest and demand.

Both the golden-cheeked warbler and the Utah prairie dog initiatives center on the species being listed by the ESA and the regulatory requirements that mandate cer-tain actions, so Toombs says it is unclear how well the frameworks and results will translate over to voluntary market scenar-ios. But in Colorado, Fankhauser is ready

to test how such voluntary markets might work, with an eye toward conservation of the greater sage-grouse.

“Incentivizing” voluntary conservationAcross Colorado’s Western Slope, mil-lions of acres of sagebrush encompass a portion of the range of the greater sage-grouse. Flocks of these birds were once prolific across much of the Interior West, but the species now occupies a little more than half of its historic range due to habitat loss and other fac-tors. In March 2010, U.S. Secretary of the Interior Ken Salazar announced that the listing of the greater sage-grouse under the Endangered Species Act was “warranted but precluded.” The decision means the bird needs protection and recovery support to avoid extinction, but that it won’t receive statutory help because the federal government has to address recovery for higher priority spe-cies first. Environmentalists, who had sued to force the listing of the sage-grouse, jeered at the ruling, saying it left the species’ survival to chance.

Fankhauser, on the other hand, who believes the ESA is “reactive” and says it has proven to be unsuccessful over time, isn’t among those critics who are just “grousing” about the dilemma. When the greater sage-grouse was denied ESA list-ing, Fankhauser seized the opportunity to start hatching an environmental market centered on its habitat.

Conceptually, a sage-grouse biodi-versity market would target oil and gas companies that are sinking well pads all

over Colorado’s Western Slope and drill-ing in prime grouse habitat on public and private lands, resulting in habitat loss and fragmentation. Through Partners for Western Conservation, Fankhauser has met with energy company officials, state wildlife staff and landowners to discuss a market for grouse habitat, which could stave off ESA listing and turn conserva-tion actions into revenue streams. The energy companies would offset their impacts by purchasing credits from land-owners who would sign contracts, agree-ing to protect or restore grouse habi-tat on their private lands. Fankhauser’s group would act as a broker, connecting landowners with interested companies and facilitating deals.

Landowner actions could include adjusting grazing schedules, erecting new fencing to exclude cattle from grouse breeding grounds, or planting vegetation beneficial to the birds. Money from cred-its would compensate landowners for the costs of these practices and also offset the loss of income resulting from scaling back their agricultural operations.

The energy industry is already required to comply with limited state and federal protection for the greater sage-grouse and other wildlife habitat require-ments through the state oil and gas com-mission. Fankhauser hopes to launch a pilot project in the next year or so based around these regulations, but he also envisions a voluntary market where the companies could choose to take further measures to mitigate harm to the birds. This type of “pre-compliance” market

“We recognize that to have this become

mainstream, like conservation ease-

ments, there’s a tremendous amount of heavy lifting to be

done early.”—Terry Fankhauser

The greater sage-grouse was denied listing under the Endangered Species Act in March 2010. Since then, Fankhauser has been working to form an environmental market centered on its habitat.

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would be optional for energy compa-nies, but Fankhauser and others believe it could prove financially worthwhile for them to participate by averting listing and the additional federal restrictions that come with it.

“To get private industry and agencies to invest early on, they need to find the [long-term] benefits,” says Fankhauser. “We recognize that to have this become mainstream, like conservation ease-ments, there’s a tremendous amount of heavy lifting to be done early.”

Launching an environmental market before a species hits the ESA has some advantages, adds Goldstein. A preemp-tive initiative should require less drastic actions, have greater chances for suc-cessful recovery, and cost facilitators, buyers and sellers less than programs built around more threatened and regu-lated species. At the same time, the loom-ing possibility of regulatory controls can motivate potential buyers and sellers.

“I think regulation is always going to play a role,” Goldstein says, even in cases of voluntary markets. “It’s about a productive balance between the carrot and the stick.”

To market, to market…bearing supplyRegulation or not, Fankhauser has become a sort of troubadour for envi-ronmental markets across the state, and he’s meeting lots of fellow travelers. In southeastern Colorado, landowners in the Piñon Canyon area who had united against the Army’s proposed 400,000-acre expansion of Fort Carson are pursu-ing a payment for ecosystem services program, based on ecological data col-lected by state scientists.

Steve Wooten, a rancher whose fam-ily has raised livestock in the region dat-ing back to the 1860s, says the market concept came to expansion opponents after a coalition of landowners decided to pay for an environmental assess-ment of their private lands. Through the Colorado Natural Heritage Program, ecologists conducted biological surveys on more than 1 million acres to iden-tify and document rare and threatened wildlife species, plant communities and insects. The natural heritage surveys provide a baseline on natural resources, which is often used to support conser-vation programs and priorities, but the Piñon Canyon landowners also believe the information could shape a regional ecosystem services exchange.

The idea is that different sets of land-owners could ultimately band together, with assistance from Partners for Western Conservation, to market ecosystem ser-

vices based on the resources on their properties. Although Wooten believes a trial project probably won’t get underway for several years, the ability to put together groups of neighboring landowners who are managing hundreds of thousands of acres similarly and then have Fankhauser and his group help seal a deal with industry holds appeal. “It sure takes out a lot of the headache for me as an individual rancher trying to go out and market what we have on our place alone,” says Wooten.

In southwestern Colorado, Art Goodtimes is also exploring options for payment for ecosystem services (PES) projects. A performance poet, environ-mental activist and San Miguel County commissioner, in no particular order, Goodtimes was inspired while attend-ing a conference on collaborative con-servation at Colorado State University in September 2009, where he heard Sally Collins and others speak. “They all were talking about PES projects, but no one was really doing them,” says Goodtimes, who decided his county would be a prime area for a market-based experiment.

San Miguel County voters had approved a bond issue in 2001 to pay landowners to preserve open space. The initiative funded the purchase of development rights from farm proper-ties, which prohibits subdivision of par-cels and puts conservation easements in place. Goodtimes considered the coun-ty’s support of the program as a signal that his constituents—a mix of liberal-minded skiers and hippies in Telluride and conservative ranch families in much of the rest of San Miguel—would be open to innovative PES projects that would support ranch families and local land stewardship.

With financial support from the county and a grant from Colorado State University’s Center for Collaborative Conservation, Goodtimes has con-vened a county working group, receiv-ing support from Toombs, Fankhauser and Goldstein, to develop local PES programs. Similar to the Piñon Canyon idea, one project could center on rare plants, identified through the state’s Natural Heritage Program. A second option would build on a past county monitoring project for old-growth wet-lands called fens and create a mar-ket to protect sensitive wetland areas. Goodtimes and Fankhauser have also spoken about extending a sage-grouse market program to include Gunnison sage-grouse. The distinct and smaller grouse species also received a “war-ranted but precluded” ruling from the

government this past September, so any market initiatives would, again, rely on voluntary actions.

Over the next year, Goodtimes expects to develop at least one of the ideas into a pilot program. Along the way, the working group will have to identify landowners willing to participate and settle on the ecosystem services that could drive a credit program.

“I’ve always been upset that we don’t get a real accounting of what natural resources are really worth in the econo-my,” Goodtimes says. “I want this to be a model so other people can see if it works.”

Market demand a factor for successGoodtimes isn’t shy about saying “if” when talking about whether market-based initiatives will work. As a self-pro-claimed environmentalist and a member of the Green Party, he has issues with every aspect of the economic valuation of the environment. “But,” he says, “I see it as a great tool for society. If it doesn’t work, the pilot will show that.”

Beyond any philosophical discussion over defining nature in economic terms, payments for ecosystem services have raised some harsh criticism. One of the leading arguments aimed at PES pro-grams and environmental markets is that despite the economic and environmen-tal objectives, the programs facilitate development without actually achieving biodiversity conservation.

Critics argue that ecosystem services make for complicated commodities that are difficult to measure. Programs that aim for “no net loss” of wetlands or wild-life habitat might look good on paper, but can still fail to positively impact species populations or water quality measures.

And while Partners for Western Conservation’s concept of paying private landowners for habitat improvements on their property could certainly benefit wildlife, Bart Miller of Western Resource Advocates in Boulder questions whether private land is the place to achieve the most impact. “Land that has been dis-turbed or managed heavily does have habitat value, but it is not pristine,” he contends. “It doesn’t have the full suite or composite of habitat for a broader range of species.” The most important thing, to the extent there is payment, he believes, is to target the most bang for the buck. “If there’s potential for greater benefit on public lands, then it makes more sense to go there.”

To add some certainty to environ-mental markets, proponents also need to pay more attention to the demand from would-be buyers, says Stephanie Gripne,


who directs the Initiative for Sustainable Development at the University of Colorado’s Leeds School of Business. “We’re flooding the market with products when we haven’t figured out if people want to buy them yet.”

After previously working at a green private-equity fund, Gripne is now devel-oping several market initiatives through her position at the University of Colorado, including programs for carbon mitiga-tion and water resources protection. But instead of building markets around the eager potential sellers ready to peddle their properties’ ecosystem services, she says supporters need to analyze what is driving corporations and others’ demand, whether it’s social responsibil-ity, branding and marketing, regulatory compliance or pre-compliance. “I’m cau-tiously optimistic in this phase, but I feel like if we don’t get some big successes in the next few years, people will abandon it,” Gripne says. “But will we be aban-doning it because of poor execution or because there really are no markets?”

Delivering on ecological and financial assurances also remains a grand chal-lenge for PES initiatives, especially as Wall Street investment firms and banks are tuning in to the potential of ecosys-tem services. “One of my big concerns with these markets is that the wrong people will get paid,” says Sally Collins. “Let’s do this so money doesn’t just go to investors, but to people on the land.”

That should be the power of envi-ronmental markets, supporters say. By building a relationship between business and conservation, between the demand for and the supply of ecosystem ser-vices, market programs connect natural

and human communities and pass on the financial benefits of functioning natural systems to the people who are preserving and restoring them. “This puts people at the center of the ecosystem,” Collins adds.

Beyond government responsibilityWhen it comes to shared resources—particularly those we associate with public lands, such as biodiversity or water quality—our tendency is to look to the government for their protection. But through market-based projects, the private sector is investing itself in these matters. Neither developers nor land-owners can look at the environment strictly as a government regulatory issue if they are charged with recovering an endangered species, maintaining water-shed flows or canceling out carbon emis-sions. This is the philosophical shift that Fankhauser envisions, and he’s not alone in imagining how ecosystem services could reset the rural landscape across Colorado and the United States.

When Collins headed the USDA Office of Environmental Markets, the agency began promoting the “Farm of the Future,” a concept of how working landscapes of farmers and ranchers can build their livelihoods around agricultural production and ecosystem services. In addition to crops or livestock, rural land-owners can collect their income through biodiversity credits, watershed services, wetland mitigation, certified sustainable timber and carbon sequestration. “It’s a big cultural change,” says Collins. “I think we’re going to draw a lot of people back into farming and ranching.”

Other regions are already moving in this direction. In Oregon, the Willamette

Partnership began as a watershed resto-ration task force and has since developed strategies focused on ecosystem services and market-based solutions. In 2009, the partnership created a credit accounting system with “currencies” in water qual-ity, salmon habitat, upland prairie and wetlands. Each market is connected to a regulatory law. The framework is a major step toward building a protocol for how credits translate into on-the-ground resto-ration, and participants see the system as the beginning of a functioning ecosystem services market operating across Oregon.

Similar aspirations have Fankhauser, Goodtimes, ranchers and environmen-talists logging hours to start payment for ecosystem services programs and markets all over Colorado. But the Farm of the Future and the proliferation of environmental markets aren’t going to materialize overnight.

Fankhauser is frustrated they can’t move faster, but he also knows what’s at stake. Colorado loses about 690 acres of agricultural land and open space every day—roughly a family ranch or farm dis-appearing from the state daily. By 2022, the state is projected to lose another 3.1 million acres of agricultural land to devel-opment. Existing programs through the federal Farm Bill and the state lottery-funded Great Outdoors Colorado pro-vide financial support for open space and wildlife habitat protection, but the Colorado Conservation Trust estimates a $1 billion funding gap to slow the rate of land conversion in the state.

“The horse is already out of the barn. The market is making these decisions already,” says Collins, “but the market doesn’t control us. We control it.” q

“One of my big concerns with these

markets is that the wrong people will get paid. Let’s do this so

money doesn’t just go to investors, but to

people on the land.”—Sally Collins

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simplyirreplaceableProtecting wetlands is tricky business, but these ecological heavyweights are worth itBy Cally Carswell


High Creek Fen, located south of Fairplay in central Colorado, is the most ecologically diverse fen in the southern Rocky Mountains and is expected to benefit from restoration work at neighboring Warm Springs Fen, which is thought to be hydrologically connected. Photo by Harold Malde

Still, claiming that the fen could be restored on a human time scale would be disingenuous. Fens like Warm Springs, which are found only in a few spots worldwide, contain thick seams of peat formed by plants decomposing in saturated soil over thousands of years. Peat formation can’t be sped up or engi-neered. So for now, rehabilitation is the best conser-vationists can hope for.

It may not sound like a lofty goal, but rehabili-tating ancient landscapes like Warm Springs Fen is a complex undertaking, and the science guiding such efforts is still young. The payoff, however—to people, plants and wildlife—can be significant. South Park’s fens are valuable habitat for a few globally rare plants and insects. The fens help keep South Park’s trout fisheries—some of Colorado’s best—healthy by filtering pollutants in storm runoff, precipitation and groundwater that feeds headwater streams, and by providing nursery habitat for some trout species. And that helps prop up the local economy, of which tourism is a lynchpin.

Wetlands are not the charismatic rock and ice land-scapes that Colorado is best known for. Their looks are humble by comparison: water-soaked soils sprouting cattails and grasses. But the mere existence of rare fens in South Park helped win the basin designation as a National Heritage Area in 2009. The title is expected to

be a boon to tourism and makes Park County eligible for up to $10 million in federal grants to protect natu-ral and cultural resources.

Even in Colorado, where the best available map-ping shows wetlands cover less than 2 percent of the state, these landscapes are ecological heavyweights. In southwestern Colorado’s San Juan Mountains, high altitude fens—often described as old-growth wet-lands—are important carbon sinks and water storage sites. Along rivers and streams in lower lying areas, wetlands filter toxins and contaminants, promote groundwater recharge, and act as sponges that moder-ate flows, preventing floods during spring snowmelt and summer monsoons and releasing water slowly through the year. In mountains and valleys throughout the state, they’re wildlife hotspots.

“[Colorado’s wetlands] are not as extensive as wetlands in some parts of the country,” says Joanna Lemly, an ecologist with the Colorado Natural Heritage Program, who has spent the last few years meticulously inventorying the state’s wetlands. “But that’s in some ways why they’re even more important here—because everything depends on water.”

But for years little effort was made to tread lightly on these sensitive landscapes. Before the Clean Water Act was passed in 1972, wetlands were freely dredged and filled to allow development or agricultural culti-


T hose working to repair damage done to Warm Springs Fen shy away from the term “restoration” when discussing their efforts. A 198-acre groundwater-fed wetland in central Colorado’s South Park, Warm Springs was mostly intact when it was protected about 10 years ago. An irrigation ditch cut through a small portion of the fen, intercepting

shallow groundwater needed to support the wetland. But only 11 acres, which had been mined for peat, to be used as a soil amendment, were severely degraded.


vation. In western states, dams, irrigation diversions and other alterations to natural hydrology have also taken a toll. The U.S. Fish and Wildlife Service esti-mates that more than half of wetlands nationwide have been lost since European settlement. Colorado is thought to have lost about the same percentage.

After 1972, though, wetlands on public and private land became regulated landscapes. Section 404 of the Clean Water Act requires developers to avoid, mini-mize and compensate for impacts to wetlands. And in 1989, the first President Bush upped the ante, setting a “no net loss” policy for wetlands at the federal level.

A number of tools have since emerged to meet that nationwide goal, though it remains elusive. The compensation method preferred by developers and the U.S. Army Corps of Engineers, the agency responsible for issuing 404 permits, is a market-based approach called mitigation banking. Developers basi-cally outsource their legal responsibility to replace what they destroy to third-party conservation banks, which create, restore or protect wetlands. The banks sell mitigation credits to developers, who use them to offset damage to other wetlands.

Since the late 1980s, more than 950 wetland and

stream banks have protected and restored some 960,000 acres of habitat nationwide, according to the National Mitigation Banking Association. The Corps and the Environmental Protection Agency say that bank projects “typically involve larger, more ecologi-cally valuable parcels, and more rigorous scientific and technical analysis,” than those undertaken by developers themselves.

But banking is an imperfect system. Certain types of wetlands, like the ancient fens found in South Park, are virtually irreplaceable. And other engineered wet-lands often can’t provide the suite of services natural systems do. In a 2001 report, the National Research Council criticized federal regulators for not doing enough to ensure that lost functions were actually replaced, noting that monitoring was lackluster.

Gene Reetz, who retired after spending 25 years with the EPA’s wetland program, says the agency would often recommend more than one-for-one replacement—as in the “no net loss” approach—in recognition that what is created will not make up for what is lost. “Even that often leads to a net loss in function,” says Reetz. And proxim-ity can be another problem. The EPA promotes on-site mitigation, where wetland values are replaced as near

“[Colorado’s wetlands] are not as extensive as wetlands in some parts of the country. But that’s in some ways why they’re even more important here—because everything depends on water.”

—Joanna Lemly, Colorado Natural Heritage Program

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The Geneva Creek iron fen (left), a sloping fen along Trout Creek (center) and High Creek Fen (right), which is an extremely rich fen like Warm Springs, are all found in the southern Rocky Mountains.


as possible to where they are lost. “The emphasis, at minimum, is to do it within the same watershed,” says Reetz. Still, the original community doesn’t recoup the lost ecologic functions and benefits.

Replacement value is also not quickly realized. In Colorado, it takes an average of 13 years for a created wetland to func-tion comparably to a native one, according to a 2004 report published in Ecological Economics that attempted to quantify soci-etal losses incurred during that “lag-time.”

The Warm Springs Fen in South Park, however, is protected by a mitiga-tion bank that is a model for avoiding some of the pitfalls inherent in the practice. By restoring the hydrology of an existing wetland, rather than start-ing from scratch, it has greater potential for effectiveness. Once the bank sells all of its 20 credits (the majority have yet to become available), it will divest

its interest in the land to The Nature Conservancy, which has pitched in by purchasing easements and water rights on surrounding properties. To fund the ongoing restoration work that’s needed, 10 percent of the variable, market-driv-en purchase price for each credit sold by the bank goes into a stewardship fund. “There are lots of wetlands that were mitigation-created, and they look okay for four or five years. But then they go to hell,” says Terri Schulz, director of land-scape science and management for The Nature Conservancy’s Colorado chap-ter. Her group will be responsible for long-term management of the fen, using the endowment to control marauding invasive weed species.

At the federal level, the Corps and EPA responded to criticism with new mitigation rules, finalized in 2008. They will soon break ground on four dem-

1. Snow Melt2. Precipitation3. Recharge4. Groundwater Discharge a. (Deep) b. (Shallow)

5. Wetland6. Peat7. Sandstone and Shale8. Glacial Outwash/Aluvium9. Leadville Formation

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hydrogeology of a high-Altitude fen

Katie Knapp is helping the city of Boulder to protect a wider range of wetland areas than are currently covered by the Clean Water Act.

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Warm Springs Fen and other extremely rich fens in Colorado are characterized by the rare plants supported by the unique chemical content of their water-soaked soils. Minerals, like calcium and magnesium, picked up

as groundwater seeps through the limestone Leadville Formation, create a very basic, or high pH, environment in which more than a dozen globally rare plant species thrive.


onstration projects—one on Colorado’s Front Range—to develop strategies for locating mitigation projects to maxi-mize benefits to entire watersheds.

In the meantime, some local govern-ments, including the city of Boulder, have stepped up to fill the gaps in fed-eral law. “A lot of streams in the area don’t have water running in them year round,” says Katie Knapp, floodplain and wetland administrator for Boulder. Wetlands fed by ephemeral streams “don’t actually develop hydric soils, so the Corps wouldn’t map them as wet-lands. But they still provide important habitat and are important for water quality.” Boulder’s regulations cover a broader range of wetlands and buf-fer areas than the Corps’, require on-site mitigation whenever possible, and prefer existing wetlands be expanded. Creating entirely new wetlands “can be

kind of tricky in terms of hydrology,” Knapp says. “You don’t always get the creation you were after.”

While Boulder is focused on pro-tecting what it has left, in the Fountain Creek Watershed, efforts are underway to increase wetland cover. The water-shed, which drains a 927-square-mile area from El Paso County’s northern border to Pueblo, maxed-out its surface water sup-ply more than 100 years ago. Today, about 80 percent of the water needed to quench Colorado Springs, Pueblo and Aurora is piped in from the Colorado River or deep aquifers in the Denver Basin. The result is a system out of balance: the watershed supports more water than it would under natural conditions. And that makes its streams flood prone.

“The old engineering standard was to narrow the stream, line it with concrete and get the water out of town,” says Carol

Baker, an engineer and wetlands specialist with Colorado Springs Utilities. “But there were more flooding issues and more prob-lems. We thought we were smarter than Mother Nature, but we kind of figured out, maybe not.”

Colorado Springs Utilities and the Lower Arkansas Water Conservancy District broke ground on a pilot flood reduction project this past fall behind a Walmart in Pueblo, where an off-channel detention pond and wetland will be con-structed. The system will never be natural, per se; with all the imported water in Fountain Creek, the area will likely see a net increase in wetlands compared to historic conditions. But as a tool to reduce the creek’s base and peak flows and per-haps improve water quality in a watershed plagued by selenium pollution, wetlands, says Baker, “are like Mother Nature’s per-fect little inventions.” q

© Jim Steinberg Photography

“Colorado is My Place...”“ Nature restores itself if we do the right thing.”

-George Glasier, owner of the Silverhawk Ranch in Naturita, rancher and conservationist

People like George Glasier not only depend on the Colorado River system for their livelihoods but also play an important role in restoring the river and its tributaries to health. To learn more about The Nature Conservancy’s work and to hear other voices from the Colorado River Project, visit nature.org/colorado.

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Obstructive dams and less water in the meandering Colorado River system meant large fish such as the Colorado pikeminnow were unable to travel the long distances required for spawning. Lower water levels also disrupt spawning cues, making reproduction even more dif-ficult. And without any natural predators, populations of non-native fish such as channel catfish and smallmouth bass—originally stocked for sport—skyrocket-ed, competing for resources. Ultimately, four native fish populations shrank to alarming levels, earning them a spot on the U.S. Fish and Wildlife Service’s endangered species list: Colorado pike-minnow, razorback sucker, humpback chub and bonytail.

However, thanks to an unprecedent-ed legal agreement, the Upper Colorado River Endangered Fish Recovery Implementation Program, the recovery of these endangered fish is a regional priority—one that has received nearly $180 million in funding to date. Although

the 22-year-old program has been large-ly successful, enabling communities dependent on Colorado River water to continue making depletions while see-ing growing numbers of the native fish, the price tag isn’t exactly negligible. Now that we know more about how our actions affect aquatic ecosystems in Colorado, can we circumvent the listing of additional species?

John Loomis, a professor of agri-cultural and resource economics at Colorado State University, believes it is important to address a species’ vulner-ability before its numbers get danger-ously low because there will simply be a wider range of more productive options for recovery. “I liken it to heath care,” says Loomis. “Do you want to wait until you are in the E.R.? Preventative health care is cheaper than triage.”

“Of course it is cheaper and easier to save a species before it becomes endan-gered,” agrees Dave Campbell, director of the San Juan River Basin Recovery

when it came to water, our predecessors made survival choices with little thought of implications to the ecosystem. More recently, 20th century dams were built for human needs—without considering native fish and their habitats. Decades of water diversion and manipulation have altered the natural flow

cycles fish depend on, often bringing river levels dangerously low or sometimes even releasing too much, too fast from reservoirs so that fisheries are destroyed.

The cosT of recovery

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A fish passage (above) at Redlands Water and Power Company on the Gunnison River in western Colorado was constructed in 1996. A fish screen built in 2005 keeps endangered and other fish from becoming trapped in the canal. A large, endangered Colorado pikeminnow (top) was captured in 2002 at the facility. Photos courtesy of the Upper Colorado River Endangered Fish Recovery Program.

Implementation Program. “But unfortu-nately our system doesn’t operate that way. We wait until they are at the brink and then deal with the problem.”

That said, Campbell himself is a communications hub between the San Juan recovery program—which has similar goals for two of the four fish species that are part of the Upper Colorado recovery program—and over-lapping efforts to prevent additional species with declining populations from becoming endangered. In the San Juan, removing non-native species, building fish passages to enable migration, and increasing seasonal peak flows to more closely resemble historic conditions are actions underway to keep populations from dropping further.

Although regulation under the Endangered Species Act and the loom-ing threat of litigation ultimately pro-vided the impetus for the groundbreak-ing Upper Colorado recovery program, signed in 1988, there are other reasons to recover a species. “These fish date back to the prehistoric era,” explains Tom Chart, program director for the Upper Colorado River Endangered Fish Recovery Program. “They have survived for millions of years and this is the only place they are found. If they can no longer survive here there are serious implications for the other species.”

Like a canary in a coal mine, the Colorado pikeminnow is an indicator spe-cies and its disappearance signals big problems within the river. Food webs are complex, and the relationships between species aren’t always direct. If an element of that web struggles or disappears, the consequences could range from prey spe-cies going unchecked to water quality deterioration. “Everything is out there for a reason,” explains Chart. “You can’t remove an animal without expecting something to compensate. And usually those compen-sations are negative.”

The impact on an ecosystem from a lost species is complex and unpredictable. It’s just one reason the Endangered Species Act was designed with teeth. In 1983, the U.S. Fish and Wildlife Service determined fish living in the Upper Colorado River were in dire straits and proposed a deple-tion match for future water users: Any water removed would need to be replaced acre foot for acre foot.

It was a jeopardy ruling backed by the strength of the Endangered Species Act. It brought water users, conservationists, three different state governments, and several federal agencies to the table ready to negotiate. The resulting plan set a standard for participation. Water users

avoid litigation by joining the program, and recovery efforts are centralized and well-funded. Ultimately, a cooperative community despite disparate interests was born.

“In the end everyone said, ‘Let’s put down our guns, let some water devel-opment occur and do it in a way that will help recover the species,’” says Ted Kowalski, chief of the Interstate and Federal Section at the Colorado Water Conservation Board. “I think that is the reason it’s so successful. All the parties are invested in this.”

The Upper Colorado recovery pro-gram has served as a basis for similar programs in the San Juan and South Platte river basins. Without this type of cooperation, species recovery would be more uncertain, not to mention more dif-ficult and costly.

“When recovery efforts are driven by demands of individual projects, they are piecemeal solutions,” says Deb Freeman, a Denver lawyer who helped negotiate the Platte River Recovery Implementation Program on behalf of water users. “That’s no way to recover a species.”

But once the details have been hashed out over conference room tables and the lawyers signed off on the details, what does it really take to recov-er endangered fish? Kowalski and the state of Colorado employ a consolidated approach, tackling the ecosystem as a whole. Essentially, the goal is to restore a hospitable environment through a com-bination of maintaining and restoring needed flows, stocking programs, fish passage construction, and the removal of non-native species.

Together, the Upper Colorado and San Juan recovery programs have spent $209 million since 1988, much of the funds coming from revenue generated by the same federal hydropower dams that have adversely impacted flows. The Platte River Recovery Implementation Program—an agreement signed between Colorado, Wyoming and Nebraska in 1997—has cost $314 million, with the federal gov-ernment matching the three states’ com-bined $157 million. These price tags are determined by the cost of recovery efforts and don’t, of course, represent the true value of species recovery.

In Australia, where a catastrophic drought and decades of excessive water allocation have spurred a $12 billion water conservation project in the vast Murray Darling Basin, the cost of species recov-ery changes daily. To secure additional flows for the environment, the Australian government has set aside $3.1 billion and will keep raising its paddle in the

“These fish date back to the prehistoric era. They have survived for millions of years and this is the only place they are found. If they can no longer survive here there are serious implications for the other species.” —Tom Chart, Upper Colorado River Endangered Fish Recovery Program

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virtual auction that is the basin’s open and transparent water market. Part of the basin’s broader plan, scheduled for release in 2011, will include legal diver-sion limits on the flows that can be taken from the basin as a whole. A government-commissioned report released in October 2010 stated that a reduction of as much as 37 percent from current diversions will be necessary to bring the system back into balance. The two-year-old Murray Darling Basin Authority, a federal agency charged with bringing sustainability to the vast basin, has published clear goals for its native fish populations: Bring native fish communities back to 60 percent of their estimated pre-European settlement levels by 2054. Meanwhile, the authority and other private groups are working to help local communities and governments find livable solutions to the substantial, controversial reduction in diversions that will be required.

The similarities in decreased fish populations and the strategies for recov-ery in the Murray Darling Basin are shockingly similar to Colorado, says Brad Udall, who directs the University of Colorado’s Western Water Assessment. Udall has twice visited the Murray Darling Basin and plans to spend three months there in 2011 working for the South Australian government. “Maybe this is a naïve viewpoint from a foreign visitor, but in Australia there is a real concern about environmental issues that goes beyond what you see in the U.S.,” says Udall. “The idea there is that these fish should function in a natural way and that nature deserves equal footing with human needs. I liken their vocabulary around water and reform to the way we talk about national security in the U.S.”

Whether Colorado’s water commu-nity is more motivated by the value of a species’ survival or the threat of water use

being limited by the Endangered Species Act, its goal regarding species recovery is twofold: getting species delisted and preventing them from being listed to begin with by ensuring populations are viable. Today there are nearly a dozen fish species of state concern noted at the Colorado Division of Wildlife. “I’m not a biologist, but there’s a definite incentive for the states and all the parties involved to help those fish so they never get listed in the first place,” says Tom Pitts of Water Consult, based in Loveland, who represents Upper Colorado Basin water users and helped negotiate the original recovery program.

As Australia confronts the crisis of a drying river, Colorado has an oppor-tunity to heed lessons from across the globe. By investing in habitat improve-ment before species hit critical lows, such profoundly expensive and dramatic remediations might be avoided. q

Construction of the Price-Stubb fish passage (above) was completed in

summer 2008, removing the last barrier to fish migration in 290 miles of the Colorado

River from Utah’s Lake Powell to the upper end of endangered fish critical

habitat near Rifle, Colorado.

Hatchery-raised razorback suckers (right)are stocked in the Colorado, Green and

Gunnison rivers in Colorado and Utah as part of efforts to recover the species. Photos courtesy of the Upper Colorado

River Endangered Fish Recovery Program.

*Status Codes:FE = Federally EndangeredFT = Federally ThreatenedSE = State EndangeredST = State Threatened SC = State Special Concern (not a statutory category)

Colorado Division of WildlifeThreatened & Endangered List of Colorado Fish

Common name Scientific Name Status*

Bonytail Gila elegans Fe, Se

Razorback Sucker Xyrauchen texanus Fe, Se

Humpback Chub Gila cypha Fe, St

Colorado Pikeminnow Ptychocheilus lucius Fe, St

Greenback Cutthroat Trout Oncorhynchus clarki stomias Ft, St

Rio Grande Sucker Catostomus plebeius Se

Lake Chub Couesius plumbeus Se

Plains Minnow Hybognathus placitus Se

Suckermouth Minnow Phenacobius mirabilis Se

Northern Redbelly Dace Phoxinus eos Se

Southern Redbelly Dace Phoxinus erythrogaster Se

Brassy Minnow Hybognathus hankinsoni St

Common Shiner Luxilus cornutus St

Arkansas Darter Etheostoma cragini St

Mountain Sucker Catostomus playtrhynchus SC

Plains Orangethroat Darter Etheostoma spectabile SC

Iowa Darter Etheostoma exile SC

rio Grande Chub Gila pandora SC

Colorado Roundtail Chub Gila robusta SC

Stonecat Noturus flavus SC

Colorado River Cutthroat Trout Oncorhynchus clarki pleuriticus SC

rio Grande Cutthroat trout Oncorhynchus clarki virginalis SC

Flathead Chub Platygobio gracilus SC

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Endowing PartnerColorado Water Conservation Board

HeadwatersDenver Suburban Water District; MillerCoors; AECOM; Southwestern Water Conservation District

BasinAurora Water; Board of Water Works of Pueblo; Brown and Caldwell; Bureau of Reclamation-Western Colorado Area Office; Camp, Dresser and McKee; Central Colorado Water Conservancy District; Colorado River District; Colorado Water Resources and Power Development Authority; Denver Water; Eagle River Water & Sanitation; MWH; Tricia

Nichols; Northern Water; Rio Grande Water Conservation District; Ute Water Conservancy District

AquifErCity of Longmont; Colorado Springs Utilities; Lower South Platte Water Conservancy District; Robert Sakata; The

Consolidated Mutual Water Company; Tri-State Generation and Transmission Association

riverAMEC Earth & Environmental; Applegate Group; CH2M Hill; City of Grand Junction-Utilities; City of Thornton; Colorado Water Institute; Douglas County Water Resource Authority; Left Hand Water District; Leonard Rice Engineers; Maynes, Bradford, Shipps and Sheftel; PAT/PAC Colorado Dairy Farmers; The Animas-La Plata Water Conservancy District; Upper Arkansas Water Conservancy District; Upper Gunnison River Water Conservancy District; Weld County Farm Bureau;

Williams Energy; Wright Family Foundation

Tributary Aqua Engineering; Arkansas River Outfitters; Richard Bratton; City of Boulder/Keep It Clean Partnership; Colorado Livestock Association; Colorado Municipal League; Katy Flynn; Golder Associates; Grand County; Harris Water Engineering; Headwaters Corporation; Hon. Gregory J. Hobbs, Jr.; Greg and Dot Hoskin; Huerfano County Water Conservancy District; Robert McGregor; Middle Park Water Conservancy District; North Sterling Irrigation District; Patrick, Miller & Kropf; Jonathon Perlmutter; Platte Canyon Water and Sanitation District; Porzak Browning and Bushong; Riverside Technology, Inc.; Rocky Mountain Agribusiness Association; Roggen Farmers Elevator; Roxborough Water and Sanitation District; Southeastern Colorado Water Conservancy District; St. Vrain and Left Hand Water Conservancy District; Upper Eagle Regional Water Authority; Vranesh and Raisch, LLP; Water Awareness and Responsibility Programs

StreamAnderson and Chapin; Ayres Associates; Balcomb and Green; Bernard, Lyon and Gaddis; Bishop-Brogden Associates; Boulder County Parks and Open Space; Tom Cech; Margy Christiansen; City of Westminster; Colorado Corn; Collins, Cockrel and Cole; Beorn Courtney; Deere and Ault Consultants; John Dingess; ERO Resources Corp.; Megan Estep; Farmers Grain Co.; Rep. Randy Fischer; Paul Frohardt; Glacier Construction Co.; Raymond Harriman; Taylor Hawes; Helton and Williamsen; Callie Hendrickson; Diane Hoppe; Hydro Construction Co. Inc.; Kennedy/Jenks Consultants; Kogovsek and Associates; Greg Larson; Scott Leslie; Anthony Lippis; Lutin Curlee Family Partnership, Ltd.; John & Susan Maus; Jack McCormick; Dale Mitchell; Reed Morris; Jake Mortell; Michael O’Grady; Pagosa Area Water & Sanitation; Pikes Peak Library; Christopher Piper; Robert Rich; RJH Consultants Inc.; Roaring Fork Conservancy; San Luis Valley Water Conservancy District; San Juan Citizens Alliance; Tom Sharp; Summit County; Town of Firestone; Daniel Tyler; Reagan Waskom; Water Colorado, LLC; White and Jankowski;

Forrest Whitman; Fred Wolf

individual Steven Acquafresca; Kurt Albers; Bill Alt; Kenneth Anderson; Susan Andrews; Arapahoe County Fairgrounds; Clarissa Arellano; Tony Arnett; David Bailey; Denise Bates; Jini Bates; David Batts; Paula Belcher; Mike Berry; David Berry; Chris Bieker; Tillie Bishop; Ronald Blatchley; Linda Bledsoe; Sharon Bokan; Lacey Books; Ann Brady; Scott Brinton; Rob Buirgy; Peter Butler; Josephine Carpenter; Gretchen Cerveny; Ron Childs; Aaron Clay; Amy Conklin; Tahne Corcutt; John Cordes; Pete Crabb; Tim Craft; Rita Crumpton; Don Cummins; Paul Dannels; Ray Derr; Kelly DiNatale; Joseph Dischinger; Sinjin Eberle; Lewis Entz; Harold Evans; Barney Fix; Thomas Flanagan, Jr.; Jack Fox; Kevin France; Terrance Fulp; Catherine Gates; Trevor Giles; William Goetz; Wayne Goin; Bill Goosman; Pete Gunderson; David Hallford; Wendy Hanophy; Duane Hanson; Johanna Harden; Paul Harms; Bob & Sue Helm; William Hendrickson; Mark and Sara Hermundstad; John Holdren; Hannah Holm; Christine Honnen; Barbara Horn; Scott Hummer; Nancy Hurt; Will Hutchins; Jim Isgar; Robert Jackson; Marian Jacobsen; Lynn and Joan Johnson; Pete Kasper; Russell Kemp; Greg Kernohan; Kirk Klancke; Stan Kloberdanz; James Koehler; Kim Koehn; Betty Konarski; Chris Kraft; Sam Krage; Robert Krassa; Bruce Kroeker; Rod Kuharich; Karen Kwon; Barbara Lambert; Paul Lander; Katie Leone; Mark Levorsen; Patricia Locke; Robert Longenbaugh; Andrew Mackie; Mary Marchun; Zach Margolis; Tyler Martineau; Donald Martinusen; Murray McCaig; Bryan McCarty; Kevin McCarty; Charles McKay; Julie McKenna; Caroline McLean; Shannon McNeeley; Rich Meredith; Jim Miller; Erin Minks; Harold Miskel; Allen Mitchek; Rebecca Mitchell; James Montgomery; Larry Morgan; Andrew Mueller; Patrick Mulhern; David Nelson; Peter Nichols; John Norton; Steven O’Brian; John Orr; Richard Parachini; James Patton; Jack Perrin; Drew Peternell; Stan Peters; J. T. Pickarts; John Redifer; Michael Reeg; Chris Reichard; David Reinertsen; Melvin Rettig; Rachel Richards; Gary Roberts; Bob Robins; Ellen Robinson; Jacob Roenbaugh; Kelly Roesch; Steve Rogers; Chris Rowe; Rick Sackbauer; John Sayre; Donald Schwindt; Stephen Seltzer; Douglas Shriver; Sonja Sjoholm-de Haas; Gregory Smith; Vicky Sprague; Gordon Stonington; Luther Stromquist; Bill Swan; James Taylor; Phyllis Thomas; Andrew Todd; Jean Townsend; Carl Trick; Paul van der Heijde; Jay Van Loan; Tom Verquer; Richard Vidmar; Richard von Bernuth; Marc Waage; Dennis Wagner; William Wangnild; Chuck Wanner; Russell Waring; Tom Waymire; David Wegner; Richard White; Jody Williams; Geoff Withers; Lois Witte; Joe Tom Wood; Connie Woodhouse; Lane Wyatt;

Kirby Wynn; Edith Zagona; Patty Zink

Thank You!The Colorado Foundation for Water Education would like to sincerely thank all of the organizations and individuals

who provided their financial support in fiscal year 2010. Our work would not be possible without you.


1580 Logan St., Suite 410 • Denver, CO 80203

NONPROFIT ORGU.S. POSTAGE

PAIDDENVER, CO

PERmIT NO 178

March 11, Lakewood

Climate & Colorado’s Water FutureTake an exclusive tour of the National Ice Core Laboratory and learn from expert speakers on climate change research. In the afternoon, we will present interactive water and climate teaching tools to use in your own classrooms or programs. All are welcome to attend!

April 6, Denver

The Colorado River: Flowing Through ConflictJoin CFWE at the Denver Museum of Nature and Science at 7:00 p.m. for the exhibition opening of Peter McBride and Jonathan Waterman’s “The Colorado River: Flowing Through Conflict,” featuring stunning images of the Colorado River captured from air, water and land. Meet Peter and Jonathan and pick up a signed copy of their recent book, which illuminates the effects of the West’s growing water needs and explores possible solutions.

May TBD, Weld County

Water on Colorado’s FarmsVisit a farm that has unique operations for an in-depth look at how agricultural water is distributed, used and returned to the streams. Nourish yourself with hands-on learning, curriculum ideas and on-farm fun!

June 13-15

Colorado River Basin TourOur annual River Basin Tour will take you on an exciting journey from the headwaters of the Colorado River to the Grand Valley. We’ll learn what local communities do to protect water quality and habitat while balancing traditional and non-traditional water needs. Come to network with peers from around the state and increase your understanding of creative approaches to water management.

Doubletree Hotel, Westminster, ColoradoThursday, March 3, 2011

• Connect with roundtable members from around the state• Discuss cross-basin opportunities• Provide input on the Interbasin Compact Committee recommendations• Introduce Colorado’s new administration• Appreciate roundtable members

Statewide Roundtable Summit

Attendance is open to the public. Registration is available at www.cfwe.org/summit.No registration cost for roundtable and IBCC members. Contact [email protected] for more information.

April 8, BoulderJoin CFWE to celebrate and support water education. This year we will honor State Climatologist Nolan Doesken with the President’s Award and Hannah Holm of Mesa County Water Association with the Emerging Leader Award. Congratulations to both!

President’s Award Reception

Hannah Holm Nolan Doesken

Headwaters Winter 2011: Ecosystem Services-- Life as we know it

Documents

Transcript of Headwaters Winter 2011: Ecosystem Services-- Life as we know it