How can farmers paid to protect a local watershed save a huge city billions in infrastructure costs?

I had an opportunity to find out when our team of economists took a field trip to the rolling Catskills some months back. This is where the New York City Department of Environmental Protection is offering financial support to farmers who help maintain water quality for 9.5 million city customers.

It has saved the Big Apple up to $10 billion it would otherwise have to spend on new water filtration plants, along with about $100 million annually to maintain them. Farmers, meanwhile, have been able to use the DEP funding to make improvements to their land and operations, benefiting their own bottom line.

If this works in upstate New York, it’ll work elsewhere, we thought. That should make this an idea worth replicating in other parts of the country.

368 NY farms onboard and more joining

The city-funded eco services program, administered by the non-profit Watershed Agricultural Council, finances drainage solutions, manure pads, barnyard construction and other projects that farmers themselves may not be able to afford. Such improvements are critical for keeping phosphates along with Cryptosporidium, giardia and other nasty waterborne diseases out of the Delaware and Catskill watersheds.

It began in 1993 as a way to avoid city water regulations farmers feared would cause economic hardship, instead favoring a more collaborative and sustainable approach.

So far, 368 farms have agreed to Whole Farm Management plans that compensate and empowers growers to be surface-water stewards of New York City’s drinking water. Together they account for 163,500 acres.

A management plan may, for example, call for closing concentrated manure sources such as slurry pits or storage piles. It would instead direct farmers to spread the waste on fields where, if well managed, it’s less of a concern and serves as a nutrient.

This has added benefits: Well-vegetated fields help plants take up nutrients, slow water flow and makes the soil more porous and absorbent.

$12 million a year helps buy water quality for NYC

The city awarded $12.6 million to the council in 2017 to fund its eco services projects. That also includes money for a smaller forestry conservation program, and payments for conservation easements to farmers.

The easements, based on a percentage of the land market value, require landowners to protect certain natural resources on their property in perpetuity – another way to protect the watershed.

People and businesses in New York City consume more than 1 billion gallons of water a day, which is supplied from the West and East Hudson systems. But there’s just one and a half year’s worth of water in storage, so it’s easy to see why the city needs a continuous source of clean water.

All this made me think of Ronald Coase, the economist and Nobel Prize winner who theorized that those who pollute can negotiate a solution with those who would benefit from pollution reductions, making everybody win.

Here was a case of his theory being acted out to the benefit of farmers upstate and water customers and taxpayers in New York City. As we left that day, we had only one question: Why aren’t more cities trying this?