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Valuing Ground Water: Economic Concepts and Approaches
remediation, through Superfund and analogous programs in the Departments of Energy and Defense as well as state and local efforts, amount to hundreds of billions of dollars. Consideration of this enormous expense has led the regulated community and some decision-makers to question the benefit-cost balance of mandated subsurface remediation programs.
The Committee on Ground Water Cleanup Alternatives of the National Research Council (NRC) has recently reviewed the technical means to restore ground water quality (NRC, 1994). The committee found that there is no panacea for treating ground water contaminated by hazardous wastes. Especially in cases with heterogeneous hydrogeologic conditions and complex chemical behavior, it may prove infeasible to restore ground water to its ''pristine" state. In such instances it may be necessary to revert to strategies that aim to contain, or isolate, the contamination to the extent possible, thus alleviating the endangerment of surrounding ground water supplies. However, even the less ambitious objective of containment implies the obligation indefinitely to monitor the quality of the adjacent threatened ground water, as well as to remove the maximum feasible mass of contaminants in order to minimize the consequences of possible failure of the containment measures. For now, the debate continues as to whether a comprehensively implemented containment strategy will prove less expensive in the long term than the current policy of complete cleanup.
Valuation, including consideration of alternative uses of an affected site, and the costs of alternative sources of water, would not only be a useful tool to guide decisions on whether to pursue containment or remediation but is also worthwhile for clarifying various trade-offs to contamination prevention action. Increasing awareness of the need to prevent contamination of ground water supplies, on top of mounting costs of remediation, point to the importance of coordinated and comprehensive land and water use decision-making. Only within such a broad framework will it be possible to inject ground water valuation into strategies for containment, remediation, or alternatives for safeguarding the welfare of the community.
Water managers make decisions within a particular sociopolitical and technical context. They are constrained by technical considerations such as capacity of various conveyance facilities, recharge capability of an aquifer, physical availability of surface water supplies, and environmental or resource impacts of supply development. They are also limited by the institutional environment in which they operate, including federal, state, and local regulations and court-decreed rights and uses of ground water, and legislated or adjudicated mandates are not always in accord with economically optimal outcomes. Financial constraints can greatly aggravate the political landscape; the impact that a particular course of