Equitable arrangements for financing beach nourishment projects

Abstract

In this paper we develop a systematic and objective economic approach to answer two fundamental financing questions created by beach nourishment projects: (1) who should pay for these projects?, and (2) what mix of taxes or user fees should be used to assess those responsible for paying? Establishment of a logical and feasible procedure for allocating the financing burden in a way that satisfies basic standards of taxpayer equity and fairness is our basic goal. An important criterion for evaluating alternative financing options is ‘target effectiveness’, that is, the extent to which a potential revenue source produces a close match between the financing burden and the benefit distribution. Various points, with examples from a recent evaluation of proposed beach nourishment projects for several beaches along the coast of southern Delaware on the east coast of the USA, are illustrated. Our equity analysis suggests that local communities should shoulder much of the financing burden for beach nourishment projects. Beach access fees and a special assessment on properties on, or near, the beach front represent the preferred sources of funds to pay for these projects.