UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
WASHINGTON D.C. 20460
OFFICE OF THE ADMINISTRATOR
SCIENCE ADVISORY BOARD
January 31, 2012
EPA-SAB-12-004
The Honorable Lisa P. Jackson
Administrator
U.S. Environmental Protection Agency
1200 Pennsylvania Avenue, N.W.
Washington, D.C. 20460
Subject: Consultation on the Development of EPA's Report on the Value of Water
to the U.S. Economy
Dear Administrator Jackson:
Water is a critical input in the economic welfare of the U.S., yet there currently is no organized,
science-based analysis quantifying the economic contribution of water. A qualitative review of
the literature provides some insights on the importance of water to key sectors of the economy,
such as the energy, agriculture, construction, tourism, fishing, manufacturing, and public water
supply sectors, but the information tends to be incomplete.
As a consequence, EPA is unable to systematically analyze the value of water to the U.S.
economy, resulting in potentially inefficient resource protection and management decisions.
EPA's Office of Water is developing a report on water's contribution to the U.S. market
economy to evaluate currently available information and to encourage research and investment to
fill this information gap. Combined with EPA research on the value of water in the U.S. from
nonmarket consumption (e.g., nonuse values, recreation, etc.), this project will provide support
for private and public decision-making at multiple scales (e.g., national, state, regional,
watershed, local).
OW requested that the Science Advisory Board provide consultative advice to assist EPA in
developing the proposed scope, planning and issues the report will address. The SAB
Environmental Economic Advisory Committee augmented with other SAB members conducted
this consultation.

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An SAB consultation is a mechanism to provide individual expert comments for the agency's
consideration early in the implementation or a project or action. A consultation does not require
consensus among the committee members nor preparation of a detailed report. The SAB is
pleased for this opportunity to provide input to OW's report on the Value of Water in the U.S.
Economy at the formative stage.
On December 5, 2012 the committee met via teleconference. Members discussed the charge
questions on the reports purpose, context, and organization. Members also discussed the
economic perspectives and analyses the agency could employ to evaluate the market value of
water. The discussion included the agency's plan to develop expert papers on key issues and
conduct workshops to support the development of the report. The summary minutes from the
teleconference and members' written individual responses to the charge questions are publically
available and posted on the SAB website
The SAB encourages EPA to continue efforts to explain on the importance of water to key
sectors of the economy and analyze the value of water to the U.S. economy. The SAB also
encourages EPA to integrate the parallel efforts on market and non-market analyses to provide a
more robust understanding of the value of water to the U.S. economy. We appreciate the
opportunity to provide advice on this important effort and look forward to your response.
Sincerely,
/s/
Dr. Stephen Polasky
Chair
SAB EEAC Augmented for the Consideration
of the Value of Water to the U.S. Economy

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