The Property and Environmental Research Center, located in Bozeman Montana, has published a policy paper based on San Francisco’s $30,000 per year “rent” for Hetch Hetchy (and comparing it to Yosemite’s $646 million backlog of overdue maintenance projects). PERC opines that San Francisco’s $30,000 rent “may be the worst contract in the history of the National Park Service.”
Before we go any further, let’s note that San Francisco pays Yosemite some $7,000,000 per year, principally as reimbursement for security and watershed protections costs – as mandated by the Raker Act.
PERC provides a few models to guide what San Francisco might fairly pay, including a “Concessions” model that would warrant $38 million per year and a “Special Use Permit Model” that would bring in $65 million per year. The report is short and worth a quick read.
We are also thankful that PERC cites the potential value of a restored valley ($1.7 – $4.5 billion) in recreational use which ECONorthwest projected in its 2019 report, Valuing Hetch Hetchy Valley.
While Restore Hetch Hetchy is focused on returning the Valley to its natural splendor rather than charging more to use it as a reservoir, we agree that the agreement is the worst ever in the history of the National Park Service. San Francisco continues to reap substantial economic benefits at the expense of the broader public interest. Change is needed.
If San Francisco were to pay a fair rent for its use of Hetch Hetchy Valley, perhaps the City would not be so resistant to restoration.
PERC is off base, however. when it asserts restoration “would force the Bay Area to reassess its entire water supply.” The misconception is disappointingly common among those who have not looked closely at the components of San Francisco’s water system.
A few reminders:
- San Francisco’s water system is one of six major water systems serving the Bay Area. Most Bay Are residents do not depend on it at all;
- Hetch Hetchy Reservoir accounts for less that 25% of San Francisco’s storage; and
- Restoration will not affect San Francisco’s water rights on the Tuolumne River.
While San Francisco should be paying more for use of the Valley, we are dedicated to returning Hetch Hetchy to its original splendor while providing access to park visitors. So, to date, we have not advocated raising the rent.