Accounting for the Environmental “Bottom Line” along the U.S.-Mexico Border

Abstract

This article explores the prospects for establishing an environmental accounting system along the U.S.-Mexico border. After reviewing the rationale for environmental accounting and developing an accounting framework, three studies from the San Diego-Tijuana region are presented. In the first study, we estimate the total proportion of government expenditures made to defend the environment against human-induced changes in San Diego. This study reveals that defensive expenditures absorb 1.23 percent of total economic output and more than 21 percent of local government expenditures. The second study focuses on a smaller area along the border where the environmentally sensitive Tijuana Estuary on the U.S. side connects to the heavily populated Canon de los Laureles on the Mexican side. Expenditures made in Mexico aim to protect against threats to human health and safety, while those in the U.S. target the preservation of recreational resources and ecosystem health. Our third study estimates the value of agriculture land losses in San Diego between 1990 and 1995. Using an average price estimate for agricultural output and discount rates ranging from 0 to 5 percent, we find that the present value of the losses ranges from 0.18 percent to 1.8 percent of the total economy. Many of the areas lost to urban development are close to the existing urban area, suggesting the possibility of secondary impacts, such as increased air-pollution emissions resulting from longer transportation distance to market.

Key words:

• border regions
• environmental accounting
• land-use change
• Mexico
• United States

Acknowledgments

We acknowledge the financial assistance provided by the Southwest Center for Environmental Research and Policy, the Department of Geography at San Diego State University, the San Diego State University Foundation, McMaster University, and the Border Institute. We also acknowledge the technical advice provided by Dr. Paul Ganster and Mr. Rudy Fernandez. We thank the many municipal officials and staff members from the State Controller's Office for supplying information and guidance. We also thank Ms. Natalia Valderrama for preparing data on defensive expenditures in Goat Canyon and for preparing the site description. Finally, we thank Mr. Richard Hamilton for cartographic assistance.

Notes

Sources: (1) Connell 1997b; (2) SANDAG 1998; (3) Connell 1997b; (4) Connell 1997a; (5) City of San Diego 1997; (6) City of San Diego 1996c; (7) City of San Diego 1996c; (8) City of San Diego 1996b. ^aNothing specified.

^bWater and sewer services provided by city of San Diego.

Note: Op. Exp. = operating expenditure; CIP = capital improvement projects.

Note: Op. Exp. = operating expenditure; CIP = capital improvement project.

Note: Operating for 1998 and capital for the 1993–1998 period.

^aCaminos y Puentes=Roads and Bridge Department for Tijuana; CESPT= Comite Estatal de Servicos Publicos de Tijuana, (State Committee for Public Services of Tijuana, responsible for water and sewer works); TJ Municipio Playas Delegac=Tijuana Beach Delegation (waterfront management); TJ Municipio=construction and maintenance of public works; UMU=Unidad Municipal de Urbanizacion (Municipal Urbanization Group; responsible for stormwater management).

^bEPA=Environmental Protection Agency; NOAA=National Oceangraphic and Atmospheric Administration; MWWD=Metropolitan Waste Water Division of San Diego; IBWC=International Boundary Water Commission; NRDC=Natural Resouces Defense Council working on behalf of the Coastal Conservancy; USFW=U.S. Fish and Wildlife Service.

Note: Excludes Carlsbad.

1. See also Kapp (1950, 1963), Boulding (1966, 1991), Mishan (1967), Juster (1973), Hueting (1980,; 1989), O’Riordan (1981), Leipert (1986), Goodland and Leduc (1987), Leipert and Simionis (1988), Daly and Cobb (1989), El Serafy and Lutz (1989), Norgaard (1989), Bregha (1990), MacNeill, Winsemius, and Yakushiji (1991), Hueting and Bosch (1991), Brown (1993), Lutz (1993), Prudham and Lonergan (1993), United Nations (1993), Van Dieren (1995), Bartelmus (1996), van den Bergh (1996), Rogers et al. (1997), Straussfoggel (1997), Jerrett (1999), and United Nations (2000).

2. The examples and implications discussed here have been added to Opschoor's (1991) summary of the flaws to clarify the implications of each one for environmental accounting.

3. In accordance with accepted accounting practices for the GRP, the defensive expenditures of private firms are already treated as intermediate costs and are correctly excluded from the calculation of the GRP.

4. Our ImPlan I-O model does not compute a net product; therefore to arrive at NRP2 and NRP3, we had to impute a depreciation estimate from State of California, Franchise Tax Board (2001) data. There were two groups of items for which the state supplied depreciation estimates:

(i) Equipment, office furniture, and machinery. These items have an average lifespan of six years and a straight-line depreciation of 16.6 percent per year.

(ii) Buildings and real estate. These have an estimated lifespan of forty years with an annual deprecation rate of 3.75 percent obtained as 150 percent of straightline appreciation.

5. Expenditures were estimated for the years 1993–1997 to avoid having lumpy capital cost dominate the estimates. This multiyear analysis was also done because of difficulties in obtaining data for comparable years on both sides of the border.