Though I do not believe a plant will spring up where no seed has - - PowerPoint PPT Presentation

though i do not believe a plant will spring up where no
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Though I do not believe a plant will spring up where no seed has - - PowerPoint PPT Presentation

FROM W ALDEN TO W ALL S TREET FRONTIERS OF CONSERVATION FINANCE James N. Levitt Director, The Program on Conservation Innovation at the Harvard Forest Research Fellow, Ash Institute, Harvards Kennedy School of Government


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FROM WALDEN TO WALL STREET

FRONTIERS OF CONSERVATION FINANCE James N. Levitt

  • Director, The Program on Conservation Innovation at the Harvard Forest
  • Research Fellow, Ash Institute, Harvard’s Kennedy School of Government
  • Coordinator, Conservation Leadership Dialogue, Lincoln Institute of Land Policy

Ash Institute Online Chat, 2/27/06

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“Though I do not believe a

plant will spring up where no seed has been planted, I have great faith in a seed. Convince me that you have a seed there, and I am prepared to expect wonders.” HENRY DAVID THOREAU

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Investment in conservation is an expression of our faith in the future

  • Faith in the future of essential natural

systems and awe-inspiring natural wonders

  • Faith in the future of our families and

communities

  • And, increasingly, faith in the ability
  • f well-conceived investments to

yield reliable financial returns

  • We are, in essence, planting seeds

that should bear fruit for many generations

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Keeping the faith can be difficult in the face of daunting challenges

  • Federal conservation programs have seen budget cuts (for

example, the Land and Water Conservation Fund); in many states, budgets for land and biodiversity conservation are also down from recent peaks (for example, in Massachusetts)

  • Global declines in wildlife populations continue apace
  • Estimates are that, if we are to establish a comprehensive national

network of conservation lands, annual capital investments in conservation would have to double or triple

  • Is such growth in capital availability for conservation even

conceivable?

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With i innov nnovation i n in n conser ervat ation n financ nce, e, it is indeed c ndeed conc

  • ncei

eivabl ble

Cont

  • ntributor
  • rs to
  • thi

his l line of ne of thi hinking includ ude: e: Pat at C Coady

  • ady, former US Executive

Director, World Bank; Partner, Coady Diemar Partners, DC & New York

  • Pet

eter S Stei ein, General Partner, The Lyme Timber Company, Hanover, NH

  • Je

Jeff Mo More re, Partner, The Accord Group, Washington, DC (for more, see www.islandpress.org )

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What is landmark conservation innovation?

  • The classic example is the creation in 1872 of the

world’s first national park at Yellowstone, following the 1864 precedent at Yosemite. The National Park idea has proved to be:

  • Nov
  • vel

el, , demonstrating a spark of creativity

  • Sig

Signif ific icant from a policy or strategic perspective

  • Meas

easurabl bly ef effective, using an objective metric

  • Trans

nsfer erab able to other organizations/jurisdictions, and

  • Endur

nduring ng, for more than 130 years.

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Where and when did we first invest in land conservation in North America?

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Consider Boston in the 1630s

  • Puritans reformers, led

by John Winthrop in Boston, came to Shawmut at Reverend Blackstone’s invitation

  • Having brought the

company charter to Boston, the Mass. Bay Company assumed the right of self-governance

1756 Map of Boston John Winthrop

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These self-governing people taxed themselves to raise money to buy open space in 1634

  • A creation of
  • f the

he peo people: Boston’s freemen voted to tax each household to buy Blackstone’s land for a Common; it was used to pasture privately owned cows, for a common military training ground, and soon thereafter for public recreation

  • Regul

gulat ated ed by the peopl

  • ple: in 1640, Bostonians passed the first of

several ordinances regulating the Common’s use, avoiding any “tragedy of the Commons” (a phrase of the 1960s)

  • Man

anaged for

  • r the

he peo people: by the 1660s, town constables were sending the “local gallants and their marmalet-madams” home from evening strolls by 9 pm

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And with ongoing citizen stewardship, the Common “shall not perish from the earth”

  • Boston’s citizens have

repeatedly defended the Common from the British soldiers and developers

  • Neighboring properties,

from the State House to private residences, benefit enormously from the Common’s amenities

1756 Map of Boston

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We are seeing similar initiatives in the early 21st century

  • Massachusetts Community Preservation Act: the

“Great and General Court” of Massachusetts in 2000 devolved to cities and towns the right to tax themselves to raise money for conservation, historic preservation & affordable housing

  • 100 cities and towns have adopted the CPA since then,

unknowingly retracing the Puritans actions of 1632

  • Conservation bonding initiatives have succeeded with

enthusiastic voter approval from coast to coast in the past decade (see Ernest Cook and Matt Zieper, Ch. 3)

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The CPA’s impact has continued to grow in financial scale & geographic scope

$- $5,000 $10,000 $15,000 $20,000 $25,000 FY 2002 FY 2003 FY 2004 FY 2005

CPA Funding (in Thousands)

Recreation Historic Housing Open Space

  • As more towns and cities

approve the Community Preservation Act, total funding levels continue to increase -- from: $26 million in 2002 to: $50 million in 2005

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Aldo Leopold and conservation incentives

  • Leopold is considered

the father of wildlife management (Yale, USFS, Wisconsin)

  • He was deeply engaged

in conservation on both public (co-founder of the Wilderness Society) and private land

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Aldo Leopold understood the importance

  • f federal land protection...

“Let me be clear that I do not challenge the purchase of public lands for conservation. For the first time in history we are buying on a scale commensurate with the size of the problem. I do challenge the assumption that bigger buying is a substitute for private conservation practice.

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… but knew that cross-sector collaboration was essential to reach conservation goals

“Bigger buying, I fear, is serving as an escape-mechanism – it masks our failure to solve the harder problem. The geographic cards are stacked against its ultimate success. In the long run, it is exactly as effective as buying half an umbrella. …The thing to be prevented is destructive private land use

  • f any and all kinds. The thing to be encouraged is the

use of private land in such a way as to combine the public and private interest to the greatest degree possible…

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… and he accurately predicted the need for innovation in the field

“This paper forecasts that conservation will ultimately boil down to rewarding the private landowner who conserves the public interest. It asserts the new premise that if he fails to do so, his neighbors must ultimately pay the bill. It pleads that our jurists and economists anticipate the need for workable vehicles to carry that reward.”

  • - Aldo Leopold, “Conservation Economics,”

Journal of Forestry, 1934

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Ecosystem services markets are emerging – and raising substantial amounts of capital

  • Consider just two examples:
  • Private companies are competing to provide

restored wetland and wildlife mitigation banks in Collier County, Florida (see Chapter 10)

  • Corporations (e.g., TIMOs) and private individuals

are investing in sustainable forestry projects that benefit from the sale of conservation easements

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We know that there are three essential elements to conservation innovations in the 21st century

  • Hum

uman r an res esou

  • urces – the people needed to implement the

great ideas (Pat Coady, Chapter 2)

  • Nat

atur ural r res esou

  • urces – the resources meriting protection

(Peter Stein, Chapter 5), and

  • Fi

Financ nancial r res esou

  • urces – the financial and budgetary

resources required to pay for the initiative (Jeff More, Chapter 11)

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< End of introduction >

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Where are we going in conservation finance?

Watch five areas:

  • 1. Traditional local and state bond facilities (Land Vote)
  • 2. Novel tax incentives (transferable credits, NMTC)
  • 3. Conservation investment banking (debt swaps,

issuance of corporate paper by largest players)

  • 4. New budgetary tools (Infrastructure, Farm bills)
  • 5. New markets (mitigation markets, emissions trading)
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New seeds will be planted… expect wonders