Coastal Services Center

Almost all coastal states and territories from Guam to Washington, Maine to Florida have been impacted by a souring economy that was made worse by the September 11, 2001, terrorist attacks. That, along with the president's call to significantly increase spending on defense and homeland security, has many coastal resource managers preparing for at least a short-term future of austere budgets.

"Clearly the most significant impact [of September 11] has been on our budget," says Peter Douglas, executive director of the California Coastal Commission. "The hit on the economy has been incredible. It's going to have significant adverse effects on our program."

Many coastal managers report state budget cuts that mean hiring freezes, no travel, no new programs or equipment, the closing of research and education centers, and in some cases, layoffs.

But the news isn't all bad. The governor of one of the hardest hit states is requesting increased funding for coastal programs addressing natural resource restoration and waterfront redevelopment. Opportunities also are being recognized by managers, such as the promotion of ecotourism, implementation of planning, education, and outreach for smart growth initiatives, and even the recruitment of better-skilled technical staff.

State Shortfalls

Numerous coastal managers interviewed for this article say their state budgets were already being pinched by the country's economic downturn before September 11, but their financial woes became worse after the attacks.

"The economy nationwide was already sliding into a recession. September 11 just gave it a healthy shove," notes David Keeley, state planner with the Maine State Planning Office.

The states and territories whose economies depend on tourism, such as California, Florida, Guam, and Hawaii, were particularly hard hit by the terrorist attacks. The seafood industry also was impacted in several coastal states, including Florida and Maine, when planes were grounded and transportation came to a halt in the days after September 11. Alaska's financial situation is tied to the price of oil, which crashed after the attacks. Very few states or territories reported little or no impacts to their budgets.

"What it means for us is that we're going to have to do more with less resources," says Michael Spranger, assistant director of the Florida Sea Grant Extension Program. As a result of a 40 percent drop in tourism, Florida is experiencing a $1.6 billion budget deficit that is forcing Sea Grant to close an office in the Florida Keys, freeze the hiring of new staff, and anticipate the permanent layoff of a number of support staff. "It's a difficult situation here," he says.

In New Jersey, the state went from having a surplus before September 11 to having a deficit of more than $2 billion after the attacks, says Larry Schmidt, director of the New Jersey Office of Coastal Planning. The result is "no new equipment, no travel, no hiring, and the possibility of layoffs. We are going to have a very lean state government, and as a result we may not have any new initiatives in terms of environmental management."

Better news was reported from Hawaii, where the more than 30 percent drop in tourism after the attacks was showing a rebound in January, and from New York where the governor's proposed budget for the next fiscal year includes an increase to a total of $10 million for coastal resource restoration and waterfront redevelopment projects. New York's governor also is seeking the creation of a new Empire Opportunity Fund for waterfront projects and downtown revitalization that would start at $750 million per year and grow to $2 billion over time.

New York's news is even more impressive when you take into account that the state is anticipating a budget shortfall of $6.8 billion for the upcoming fiscal year, says George Stafford, director of New York Department of State's Division of Coastal Resources.

"New York state, the focus of the worst of the attacks, has a governor who recognizes the importance of the environmental and economic health of the coast to our communities, and is proposing to put more money into making the coast a better place," says Stafford. "We will be able to do more, if that budget is passed, than we have been able to do in the past."

Managers of National Marine Sanctuaries say they are in better shape than many state coastal programs because they receive little to no state funding. The state budget shortfalls primarily impact their ability to partner with state programs in managing resources, notes George Galasso, assistant manager for the Olympic Coast National Marine Sanctuary.

With the war on terrorism and increase in homeland security acknowledged as the country's highest priority, however, all coastal managers are watching the budget process in Washington, D.C., with a concerned eye.

Looking to Washington

The good news is that there probably will be no impact to the current 2002 budget, predicts Alan Neuschatz, associate assistant administrator for management for the National Oceanic and Atmospheric Administration's (NOAA) Ocean Service.

"There was a whole slew of speculation about the possibility of budget reductions" after the terrorist attacks, but no rescission is now predicted, Neuschatz says. "Of course anything is possible. Congress giveth and Congress taketh away. But it's a practical matter that the further you get into a fiscal year, the less likely it is that it's going to occur."

At the time of publication, the president had not yet released his proposed 2003 budget, and neither Neuschatz nor Richard Edwing, chief of the policy analysis and communications division for NOAA's Ocean Service, could discuss what the proposed budget contained.

"The simple fact is that homeland security is going to be around for awhile," notes Edwing. "Whether this is good or bad for coastal managers is hard to say." He suggests that managers take a "hard look" at homeland security and see if there are any logical connections where they may be able to support the nation's highest priority.

The Silver Lining

While the budget picture seems grim for coastal managers, many say they see new opportunities, as well. For instance, Gary Lytton, director of Rookery Bay National Estuarine Research Reserve in Florida, says tourism officials in his state are working to increase ecotourism, and "as a result, they're beginning to reach out to programs such as ours."

The economic downturn in Florida also has slowed coastal real estate markets and development. Lytton says they are taking this opportunity to provide professional training to real estate agents and developers on the coastal ecosystem, and are "beginning to institute some smart growth policies and guidelines to help manage growth locally."

"When the growth kicks back in," he says, "we might be in a better position to manage it."

There are even opportunities for hiring better-qualified staff, says Henry Norris, program administrator for the Florida Marine Research Institute's Fish and Wildlife Conservation Commission. He notes seeing an increase in the skill level of applicants for technical positions.

"There are a number of unknown opportunities," Norris says. "Coastal managers have got to be in the security arena that is unfolding right now. Merging needs to take place on issues of security and how coastal management is connected. There are opportunities to do that. If coastal managers just let this unfold around them, there will be no opportunities."

For more information on the president's proposed 2003 budget, point your browser to www.whitehouse.gov. For more information on the New York governor's proposed budget, log on to www.state.ny.us/governor/. For more information on Rookery Bay National Estuarine Research Reserve's smart growth initiatives, contact Gary Lytton at (941) 417-6310 or gary.lytton@dep.state.fl.us.