Funding and Financing
The Chesapeake Bay is America's largest estuary, and questions about financing the restoration effort can sometimes seem as complex as the ecosystem itself. Pollution loads come from hundreds of wastewater treatment plants, thousands of farms, and the millions of people who reside and recreate in the watershed. A comprehensive restoration strategy is the only effective way to address such a vast ecosystem and the innumerable pressures it is under. A big plan can cost big dollars.
The Big Picture
The costs associated with this comprehensive effort are necessarily large.
- In January 2003, the Chesapeake Bay Commission conducted the first-ever attempt to catalog the costs associated with the overall restoration in its publication, The Cost of a Clean Bay: Assessing Funding Needs Throughout the Watershed. Looking at just the states of Virginia, Maryland and Pennsylvania, the Commission calculated a restoration price tag of almost $19 billion.
- Shortly thereafter, the states compiled their tributary strategies, detailing all the actions that would be necessary to restore water quality to the Bay and its tidal waters.
- In October 2004, the Bay Program's Blue Ribbon Finance Panel looked across the entire 64,000-square-mile watershed and estimated the total water quality restoration cost, based on these new state estimates, to be $28 billion—more than $200 per year for every watershed resident through 2010.
- Just two months later, the Bay Commission followed up the release of the Blue Ribbon Finance Panel's report with the timely Cost-Effective Strategies for the Bay: Six Smart Investments for Nutrient and Sediment Reduction. The Commission's report showed that the majority of pollution benefits could come from a more modest investment than the costs associated with every restoration activity outlined in the tributary strategies.
Significant investment in Bay restoration and preservation is already well established. Approximately three-quarters of the direct spending on Bay restoration and preservation activities comes from state governments throughout the watershed, according to a 2005 report from the U.S. Government Accountability Office.
Over a ten-year period ending in 2004, an estimated $3.7 billion in direct funding was provided to restore the Bay. Maryland , Virginia , Pennsylvania and the District of Columbia invested $2.7 billion during that period while eleven federal agencies combined for an additional $972 million . This funding was provided for water quality improvements, sound land use, vital habitat protection and restoration, living resource protection and restoration, and stewardship and community engagement.
Coordinating the Effort
The Bay Program is coordinated through the Chesapeake Bay Program Office, housed in Annapolis, Maryland. Since the early 1980s, EPA has provided funding to this office to support the restoration partnership. Through an annual appropriation from Congress, the EPA office provides the scientific, analytical and coordinating functions to make the partnership work. Since 1995, EPA funding of the Bay Program Office has remained steady at about $20 million annually.
- Approximately 45 percent of these funds is given back to the states as “implementation grants.”
- An additional 15 percent is used for various monitoring programs.
- Another 20 percent of the annual appropriation goes to fund grants, contracts and inter-agency agreements that bring experts to the Bay Program Office for projects ranging from agricultural conservation practices to wastewater treatment plant upgrades, as well as for critical special projects.
- The Bay Program's sophisticated computer modeling effort, used to calculate pollution reduction targets and to simulate various clean-up scenarios, captures 5 percent of the annual budget.
- The remaining money, about 15 percent, is used to support the personnel (salaries and benefits) and office (computers, phones, supplies, etc.) that support the larger partnership.
The partnership's Budget Steering Committee provides guidance to EPA on how the appropriated dollars should be spent every year.
Special Funding
In addition to the annual EPA Bay Program Office appropriation, the Bay Program has benefited from special grants programs over the years.
- The Small Watershed Grants Program is currently administered in cooperation with the National Fish and Wildlife Foundation, with contributions from the U.S. Forest Service, the National Oceanic and Atmospheric Administration, the U.S. Fish and Wildlife Service, the Natural Resources Conservation Service and the Chesapeake Bay Trust. Small Watershed Grants have been provided to organizations and local governments working to protect and improve local waters and habitats across the Bay watershed, while building citizen-based resource stewardship.
- The Chesapeake Bay Targeted Watershed Grants Program is also currently run in cooperation with the National Fish and Wildlife Foundation and with contributions from the Chesapeake Bay Trust. Targeted Watershed Grants aim to expand the collective knowledge on the most innovative, sustainable and cost-effective strategies—including market-based approaches—for reducing excess nutrient loads within specific Bay tributaries. To achieve this goal, the program has awarded grants of up to $1 million on a competitive basis to projects that target and reflect the diverse conditions (e.g., urban, rural, suburban) and sources of nutrients (e.g., agricultural, stormwater, other non-point sources) that exist throughout the Chesapeake watershed.
For a listing of current EPA grants, go to: