The Bioeconomics of Stream Management in Hawaii

Michael H. Kido

Hawaii Stream Resarch Center - University of Hawaii Center for Conservation Research & Training

This paper was presented at a conference on "Sustaining Natural Resource Management in the 21^st Century", Western Association of Fish and Wildlife Agencies, Honolulu, Hawaii, July 1996, and sponsored by the State Division of Land and Natural Resources, Michael Wilson - Chair.

Managing streams and water resources in general in Hawaii in the past few years has become increasingly controversial. These controversies, to large degree, are reflections of the critical importance of water to our island society. What I would like to do for the next few minutes, is to loosely apply bioeconomic theory to the management of streams as a resource in the Hawaiian Islands, try to conceptualize the manner in which we have historically viewed this resource, describe some of the biological problems in streams that have resulted from this historic perception, and finally suggest approaches that we can take to more rationally and responsibly manage streams to balance the need for stream conservation in the Hawaiian Islands with our society's growing need for water.

In the science of resource management, bioeconomics is a term which encompasses the inevitable interaction between biological systems on the one hand and human economic systems on the other. Applied to stream management in Hawaii, on the one hand we have a need to protect a biologically unique suite of freshwater organisms, while on the other hand we have society's need to withdraw water from streams, springs, and aquifers to generate hydropower, irrigate crops, and to provide drinking water for its citizens. Bioeconomically, this is a unique situation because society is not so much interested in exploiting the biological resources of the streams per se, as it is in exploiting the water resource itself. The reality is, however, that you cannot sustain the biota without its habitat therefore overexploitation of the water resource will simultaneously result in the degradation of the stream's biological resources and this is the basis of the management dilemma that we face.

The historic exploitation of water resources in Hawaii is equivalent, conceptually, to the exploitation of fishery resources. Both are renewable, exploitable for economic gain and potentially over-exploitable to the point of non-sustainability. This is an extremely simplified bioeconomic model that was developed by Gordon (1954) over 40 years ago to conceptualize the economic return on a fishery which is exploited in an open, competitive manner. Revenue generated from the sale of fish captured is plotted against effort or cost expended to catch these fish. In Gordon's model (1954), a so called "bioeconomic equilibrium", will be reached in an unregulated fishery where total revenue generated from the fishery just balances cost. The fishery itself, at this point, would have been depleted below the point of sustainability and no one is making money from exploiting the fishery any more. Net profits would be maximized, however, if fishermen would voluntarily reduce their fishing effort to E0 where the fishery is maintained at some sustainable level. In the real world, of course, such constraint is rare and history is replete with examples of fisheries that have been driven to the brink of extinction. Gordon's over-simplified model reveals a fundamental problem in renewable resource exploitation which is that if unregulated, open-access resources will become over-exploited, leading to the impoverishment of the resource.

Now an important concept here, is how society views the resource. In the case of this hypothetical fishery, there is open, competitive access to it. In other words, any one is allowed to exploit it and there are no limitations on the level at which the resource is allowed to be depleted. According to Colin Clark (1989), upon whose work I've based much of my analysis, this principal of overexploitation of common property is a universal one and in my mind, closely parallels the way that water as a resource has been viewed in the State of Hawaii over the past 150 years. Water diversion from streams for agricultural and hydropower generation purposes have been identified as the primary agents of historic stream degradation in Hawaii.

This is an example of a diversion used generate hydropower and is found at about 213 m elevation across the Wainiha River on the northern side of the island of Kauai. The diversion operating at low flow is seen in the photo on the right. Constructed around 1920, it depletes 100 % of natural streamflow 80 % of the time, sending water through a system of ditches and flumes to a powerplant site several miles lower in the valley (see photo).

Shown below is an example of a typical agricultural diversion.

These weirs were constructed all over Hawaii in the early 1900's to divert water from streams to irrigate sugarcane. This particular diversion is across the Anahola River at about 100 m elevation on eastern Kauai. It diverted stream water into the Lower Anahola Ditch System. Used to irrigate sugarcane, this ditch was part of an irrigation system which is colored in red in the sketch below. The system was constructed back in 1877 and was used to water some 1600 acres of sugarcane in the area.

A brief survey that I did of the streams in this area last summer, indicated that not only were all of these streams highly sedimented from soil runoff, but that native species had been extirpated from all of the smaller streams which were cutoff by the ditch system. Only a small contingent of native fish and invertebrate components were existing in the larger streams of Anahola and Kealia.

Dewatering of streams by diversions like the ones you saw earlier, are perturbing streams in ways that we are only now beginning to understand. The diversion structures themselves, for example, act as physical barriers to the movement of native amphidromous species which require open connections between mountainous reaches and the ocean to complete their life cycles. Chronic dewatering reduces available habitat and distorts the natural rhythm of water movement and flow-disturbance to which native species are superbly adapted. We have also found that flow reductions erode the food base which supports native stream species in favor of less-preferred slow-water tolerant forms.

Slow-water conditions in streams created by water diversion also favor exotics such as the swordtail, Xiphophorous helleri. Parasitologist Bill Font (1994) has suggested that these introduced poeciliids are transmitting parasites to native stream fishes. This is an example, therefore, of an indirect and insidious effect of water diversion which may be further contributing to the declines we are witnessing in the populations of our native stream fish fauna.

Coming back to the fishery analogy for a second, bioeconomic principles suggest that regulation of the resource exploiters, by an external group or agency that does not have a short-term profit motive, is essential for the protection of the resource as well as the viability of the industry itself. Interestingly, it is not that the resource users are acting irrationally, quite the opposite is true, it is the nature of bioeconomic systems, where exploitation of a renewable resource is concerned, to lead to socially undesirable results. As Clark (1989) points out, it is precisely because rational individual behavior leads to socially undesirable results, that regulation is necessary.

This is the bioeconomic model for such regulation where a "regulated bioeconomic equilibrium" is reached when an unbiased regulatory group or agency, which of course is usually government, holds exploitation effort on the resource to a level which allows the resource to replenish itself and maintain sustainability. In fisheries management, various types of regulations have been applied. Shortening of the annual fishing season, for example, has been applied to the Pacific fisheries for salmon and herring. In our case, however, we cannot expect people to not drink water for extended periods of time!

Well welcome to the real world! One of the leading themes of bioeconomics is that there will always be conflicting demands on resources and while such theory is useful, I realize that decision-making for you resource managers is much simpler in this idealized world than it is in the region of the world that you work in. This is becoming one of my favorite slides and I've used it in the last three talks that I've given because it raises several key issues which I think are at the root of water controversies here in Hawaii. These are two taro farmers (John Reppun on the right and Albert Badiyo on the left) from Waiahole Valley on windward Oahu who support stream conservation and restoration and are fighting to keep water flowing in their stream. On the opposite side of the controversy are large-land owners who feel that the water has greater economic value if exported to the Leeward side of the island through a tunnel system that was constructed by sugar growers at the turn of the century. In the middle of this controversy is the State Commission on Water Resource Management, which is the regulatory agency in the bioeconomic structure that I described earlier, and whose mandate from the Hawaii State Water Code is to safeguard the water resources of the State.

It seems to me that central to this controversy, are differences in the value that is attached to the water itself. In industrial societies like ours, water only has value if it can grow crops or generate electricity by driving hydroelectric turbines. The prevailing attitude, even in Hawaii today, is that the water is free. In reality, the cost of water is to pay the prorated cost for transporting water through pipes or ditches, for drilling wells, digging reservoirs as well as to cover the costs of the expensive manpower required to maintain all of this infrastructure such as the hydropower plant and its pipe and ditch system transmitting water into it.

This value system for water contrasts sharply with that held by the taro farmers in Waiahole valley and their Polynesian predecessors who placed supreme value on the water itself. I will attempt to illustrate their paradigm for water through their language. The Hawaiian word for water is wai, waiwai is the word for wealth or value. Kumuwai means both the source of wealth as well as the source of a stream. The translation of our concept of the watershed into Hawaiian is aina kumu wai or the land that is the source of the water. It is this paradigm that the water has value because it sustains all life is central to the conservation ethic. Conservation by definition implies a concern for the future. It is an entirely different perspective of water as a resource than that held by most of modern society which is losing sight of this reality as if it could exist in a world separate from other living things. The challenge for resource regulators whose task is to achieve sustainability of special resources such as water, is to recognize and somehow incorporate these intangible values of the resource into the decision-making equation.

From a stream management perspective in Hawaii, bioeconomic principles tell us that regulation is unavoidable and should not be viewed as interfering with the private sector. Business must become a partner in management as clearly, stream protection benefits society in general. As Clark (1989) points out, the responsible approach is one of continuously monitoring the resource and improving management regulations of it with the goal being to achieve long-term sustainability. The challenge now for the scientific community is to develop sensible management guidelines for streams that are based upon realistic models of how Hawaiian stream ecosystems function. This means that our management view of streams must be expanded to include their adjacent riparian zones as well as the watersheds that encompass them. The research required to develop science-based stream management guidelines is going to have to be funded by government in partnership with business. As Dr. Clark (1989) points out, without government's support, the research will not get done. It is after all, government's responsibility to protect public resources such as water.

We sometimes forget that all of the water that sustains us on our islands comes from rainfall and that our water supplies are therefore finite and potentially exhaustible. With such a narrow margin of safety, we cannot afford to succumb to the time discounting argument used in bioeconomics which plead for immediate and unregulated allocation of water for agricultural production, jobs, electricity, and economic expansion. If we factor uncertainty into the equation, we may not have enough water in the future, say because of sustained drought or aquifer contamination, to support the level of population or economic growth that we've allowed. This is another important lesson that we can learn from bioeconomic theory. The increasing incidence of controversies over water that we are now experiencing on Oahu may be because we are dangerously close to or have already passed the critical level of sustainability for that island. Achieving sustainability of our water resources is one of the most important and crucial goals of the next century in Hawaii.

Literature cited

Clark, C.W. 1989. Bioeconomics. In: J.Roughgarden, R.M. May, and S.A. Levin (eds.), Perspectives in Ecological Theory, pp. 275-286. Princeton Press, New Jersey.

Font, W.F. and D.C. Tate. 1994. Helminth parasites of native Hawaiian freshwater fishes: Am example of extreme ecological isolation. J. Parasitol. 80(5): 682-688.

Gordon, H.S. 1954. The economic theory of a common-property resource: The fishery. J. Polit. Econ. 62: 124-42.

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