The Bay region would greatly improve its ability to pay for the multibillion Chesapeake restoration by forming a regional finance authority that could reach across state lines to address—and fund—restoration activities, a study panel has concluded.
Such an authority would have the power to receive funds from the states and the federal government and distribute it in ways that would achieve the greatest benefits, regardless of jurisdictional boundaries.
But a committee that explored the creation of such an authority warned that it would only work if the states can assure adequate funding and cleanup leaders commit to a major effort to sell state and federal lawmakers on the concept.
“The challenges facing jurisdictions and communities across the watershed are immense,” the study committee said in a white paper summarizing its findings.
“With Chesapeake Bay restoration costs estimated in the tens of billions of dollars, success will not be cheap, nor will it be easy. Yet despite these challenges, leaders throughout the watershed are faced with an equally enormous opportunity.”
The creation of a regional authority was a key recommendation of the Chesapeake Bay Watershed Blue Ribbon Finance Panel last year, but the panel said the details for such an authority needed to be explored in greater detail.
The Chesapeake Executive Council, which had appointed the Blue Ribbon Panel to find ways to pay for the Bay cleanup, agreed in January to name representatives from each jurisdiction, along with financial and legal advisors, to a special committee that would determine how such an authority would operate and to report by July 1.
(The council includes the governors of Maryland, Virginia and Pennsylvania; the mayor of the District of Columbia; the EPA administrator; and the chairman of the Chesapeake Bay Commission, which represents state legislatures.)
The committee issued a white paper outlining various options for an authority, and making its own recommendations. Exactly what will happen with the recommendations is unclear.
The committee had called for a meeting of the Bay Program’s Principals’ Staff Committee, which includes top state and federal department agency officials, to hammer out further details of the authority, including funding formulas and strategies to lobby Congress for federal participation. The committee also called for a special meeting of the Chesapeake Executive council by Sept. 1.
None of those meetings took place, although agency officials received separate briefings on the committee’s conclusions. No formal meeting is expected to discuss the recommendations until the Principals Staff Committee meets in October.
The delay drew criticism from Roy Hoagland, the Chesapeake Bay Foundation’s vice president for environmental protection and restoration, who served on the study committee.
“It is a disappointment that the committee’s two primary recommendations for ensuring continued movement on this issue have been ignored.” he said.
He said the inability to schedule timely meetings to move forward on an issue central to the Bay cleanup—securing adequate funding—raised questions about the commitment of leaders.
“The steps that need to be taken now are the steps that require political leadership,” Hoagland said. “Absent that political leadership, we will see no action on the financing authority.”
The white paper repeatedly warned that establishing an authority, which would require shifting funds from one state to another, would require tough decisions and a concerted strategy to promote the concept. “It will require a coordinated effort by the Executive Council and leadership throughout the region,” the committee said. “Convening the Council as soon as possible to develop a strategy for that coordination is essential.”
After reviewing the structure of other funding authorities around the nation, the committee’s white paper offered a picture of how such an authority should operate in the Bay region.
On the most critical issue—funding—the committee recommended a system in which jurisdictions would make direct payments to the authority, which would be matched by the federal government.
Exactly how each state’s share would be determined was not spelled out, although the committee said it could be equal payments, based on population, based on pollution loads reaching the Bay or other formulas. “The most crucial concern is that the resources be guaranteed and secure,” the committee said.
The authority would be overseen by a governing body representing all those with a financial stake in the authority, but which would be advised by a professional staff and by advisory boards composed of stakeholder groups, scientists, financial specialists and others.
Ultimately, it would distribute funds for projects that would have the most benefit, even if some jurisdictions paid out more than they got back.
“Regional environmental problems require regional leadership, regional cooperation and coordination, and practical problem-solving on a regional basis,” the committee said. “The partners must support that concept—politically and financially—before an authority can succeed.”
The paper cited numerous examples of interstate agreements that could serve as the model framework for such an authority. It recommended a formal compact that would require the legislatures of each participating jurisdiction to ratify identical legislation establishing the power and duties of the authority, as well as state rights and obligations, then having it approved by Congress.
That could take years to accomplish, though, so the committee also recommended establishing a formal interstate agreement in the interim that would commit initial funding resources to capitalize the authority, but would not necessarily commit participation by Congress, as would an interstate compact.
The committee acknowledged that establishing a financing authority—especially funding it—would be politically difficult.
But, it said, a financing authority would have advantages beyond improving Bay cleanup efficiency. “Most importantly, creating a regional financing authority provides the opportunity to increase the political will to tackle significant water quality improvement efforts across the watershed,” the committee said.
“By agreeing to take the bold steps to establish and fund a regional financing authority, the Chesapeake Executive Council will send a clear message to citizens across the region that protecting and restoring the Chesapeake Bay is an essential community priority and will require unprecedented coordination and cooperation.”
The committee’s white paper, “Chesapeake Bay Financing Authority Organizational Template,” is available on the Bay Program’s web site at http://www.chesapeakebay.net/pubs/FinancingAuthorityTemplate.pdf