A Possible Institutional Solution

The already mentioned institutional assessment delivered to the Washington Biodiversity Council contends that the capacity of Washington's public sector to define, categorize, and prioritize areas of concern related to biodiversity is increasing. But this capacity to understand biodiversity must be matched with governing institutions for it to be of any use, and some institutions are better suited for administering market-based policies than others. To use market-based policy to conserve biodiversity, there first needs to be a legislated understanding of biodiversity. Second, there must be an institutional realization of that understanding. And third, there must be a way to strategically weave this realization into both the existing regulatory framework and the market. The very existence of the Washington Biodiversity Council demonstrates recognition of biodiversity's importance and offers the state a starting point for creating a legislative understanding. Special districting, a prevalent form of government, creates a convenient way to build on this, and achieve all three of the steps above — allowing for the administration of market-based policies for biodiversity across the landscape, in a holistic way.  

Special Districts for Biodiversity

The preservation of Washington's entire range of biodiversity is unlikely to occur through the current, piecemeal public policy approach. Existing conservation programs, even though there are scores of them, deliver insufficient results. They are neither comprehensive enough, nor coordinated enough, to ensure the level and breadth of protection necessary. Part of the reason for this is that there are no clear goals for the preservation of biodiversity. The other part of the reason is that no institution of government aligns itself completely with the protection of biodiversity in its entirety. Both of these factors need to change in order for better protections to emerge. 

Goals

The establishment of goals related to the conservation of biodiversity will depend first on the expertise of natural resource managers and other stakeholders, and second on confirmation by the public. It is therefore far outside the scope of this paper to dictate what these goals should be. Thinking broadly, they could include a mission to slow down the rate of loss, prevent any further loss, or to take a restorative approach to conserving different types of biodiversity. Whatever the case, these public statements of value must be coupled with indicators that measure the progress made towards them. As discussed earlier, a comprehensive indicator for biodiversity may not yet be possible. But if a governmental apparatus is in place, along with goals for what this government is working towards, then at least some sort of evaluation can occur (even if its validity isn't guaranteed) as long as the indicator, or suite of indicators, is used consistently. If different types of biodiversity are to have different conservation goals applied to them, and if the progress made towards these goals is to be measured using different indicators, then it is reasonable to expect a highly complicated regulatory environment to emerge. While some regulatory complexity is inevitable when dealing with such a multifarious issue, it may still yet be possible to organize a relatively simple institutional response. 

New Institutions

Biodiversity is generally tied to geography. Where you are dictates, in many ways, what kind of biodiversity surrounds you. It is location specific. This isn't to say, however, that elements of biodiversity aren't affected by external factors. As discussed before, international pollution may profoundly affect the health of biodiversity in Washington. This also isn't to say that elements of biodiversity depend wholly on a single place. Wildlife does have a tendency to move around after all. Rather, this statement provides a tenable starting point in space for building an institution to govern it. Special districts, like biodiversity, are also tied to geography. These districts allow individual issues, within a defined area, to be governed by limited governments that are generally free from the influence of others that share their boundaries. Special districts can exist within one type of conventional jurisdiction, or cross over many of them. They allow for a government to be built around an issue or service in a way that accounts for the actual spatial characteristics of the issue or service. The advantages of creating special districts to handle biodiversity in Washington are many, but they all may be captured in the argument that a regular state agency "that has multiple tasks can be expected to perform one or more of them poorly" (Schick 46),   while "an agency with a singular task has an incentive to perform its sole responsibility well" (Schick 46).  Dedicated special districts, therefore, avoid the multiple and competing mandates that face regular agencies by allowing them to focus their efforts with minimal internal conflict.

Special districts, by their very nature, operate outside of the traditional, vertically integrated, government structure that has developed in all states. This frees them from a lot of the burdensome administrative and fiscal rules by which this older type of government structure must abide. The end result is that special districts offer greater flexibility when addressing public concerns, greater independence from political and bureaucratic influence, and a greater opportunity for continuity in policy related to a specific issue or service (Schick 14).

Special districts include one additional characteristic that makes them an attractive option for executing the public's will. They generally are very responsive, for four reasons, to local concerns. First of all, they are often situated in the districts they represent, creating physical proximity. Second, they are often staffed by people from the district they represent, imbuing them with a local regard for place. 

Third, the flexibility these districts posses usually allows them to account for local conditions and needs better than more rigid traditional forms of government which are embedded in a hierarchy. Finally, special districts are often funded by local taxes making their continued survival dependent on satisfying local concerns. Local independence brings with it a variety of hazards, including the difficulty of coordinating actions between independent entities and of keeping them directed towards the statewide goals they are ultimately accountable for. Local and state objectives will undoubtedly come into conflict when addressing biodiversity. For instance, rural communities may favor more utilitarian biodiversity values than urban communities by placing less emphasis on those elements of biodiversity that have limited value as traditional commodities. Special districting does not solve such value conflicts. However, it does provide a dedicated venue in which such conflicts can be mitigated, which is more than is currently available in many places. 

Challenges

Of course, special districts present their own set of challenges relating specifically to accountability, coherence, and integration.  The accountability challenge emerges precisely because these districts operate outside of traditional government and its series of checks and balances. To keep these districts accountable, many governments have turned towards performance-based evaluations. This refocuses oversight on outputs and outcomes instead of inputs and procedure. The coherence challenge emerges for the same reason as the accountability challenge and can be overcome, in part, through the same application of performance-based evaluations and measurement. As long as there are clear goals, and a way to measure the progress made towards them, special districts have the potential to deliver public services without the bureaucratic conflict and confusion endemic to agencies struggling to fulfill multiple mandates, with dwindling resources, and little guidance on how they should be balanced.

The integration challenge is particularly tough. Productively weaving special districts into both the existing regulatory framework and the market will be difficult. Older agencies, and the larger government structures they represent, are not eager to relinquish authority or funding to new ones. Nor are they designed to coordinate seamlessly with other agencies that don't share their mandates, history, or culture. Solving these "turf" issues requires strong leadership and, at the least, minor structural revisions to existing government entities.

Structure

The actual structure and administrative mechanics of special districts are varied and complex, creating a number of different design options for biodiversity conservation. This paper will not examine all of these options and their associated characteristics, but special attention will be given to how such a district could be financed. Most special districts receive funding from a variety of sources, even though one source often brings in a most of the revenue. These sources may include property taxes, service fees, intergovernmental grants, and general-fund money from the state. Research conducted in the late 1990's suggests that most special districts that span multiple local municipalities rely on property taxation as a major component of funding (Foster 167).  This "regionalized and collectivized" (Foster 105)  approach has the advantage of spreading service costs over the entire population of the district, which may make the most sense when considering the dispersed and hard to quantify benefits that biodiversity supplies. Whether such a revenue source make political sense is debatable — especially with a spirited anti-tax movement in Washington. Alternatively, a special district for biodiversity may chose to privatize their costs by relying on fees, rents, or other individualized charges. Such an approach "enhances fiscal equity, encourages the conservation of resources… and eliminates cross- subsidization of services delivery, all of which increases efficiency" (Foster 107).  The challenge with this approach is in finding the appropriate individual activities to affix such charges. Whatever method is used, it is important to recognize that the more dependent a special district is on general fund support, the less independent it is going to be. So, if independence is prioritized, then independent sources of revenue need to be as well (Please see "Funding Local, Regional and State Goals" box). It is also worth mentioning that a special district with the capacity to generate income for dispersal to other government agencies — in order to accomplish shared goals — will most likely surmount some of the integration challenges mentioned above. The opportunity to secure more revenue does tend to weaken an agency's institutional barriers to collaboration.

Markets and New Institutions

Markets, unlike biodiversity and special districts, are not generally tied to location. Certainly exceptions to this statement occur, but for the most part, the domains of markets are dictated by economic restraints. The key to using market-based policies to conserve biodiversity is to synchronize markets with the spatial limitations of special governments designed around distinct areas of biodiversity. New geographic designations that encircle similar types of biodiversity could help unify conservation efforts by becoming the basis for special districting. This same designation could also be used to define the boundaries of market-based policies created to preserve it. For instance, these "ecoregions" could simultaneously be the jurisdiction of a government, a service area for mitigation banks, and a service area for the provision of ecosystem services related to biodiversity. Such an institution, dedicated to the complete conservation of biodiversity, would be comprehensive by definition. It could also provide coordination in two ways: first through addressing the public policies of the traditional institutional framework, and second through addressing those of a new market-based one.

It would be easy to say that a new regard for biodiversity must be incorporated into older government programs. However, with multiple and conflicting mandates, and a dearth of funding, such a statement fails to account for the constrained operating environment they face. When it comes to established programs and policies, special districts for biodiversity could simply act as an evaluation tool. They could assess the effectiveness of the existing policy matrix and expose any gaps or shortcomings. This would not require a shift in authority. Such an arrangement would allow for isolated and statewide appraisals to occur and establish benchmarks for future actions After conducting evaluations, the special district could then make suggestions as to how these gaps can be filled, or fill them directly. Among the tools available to them would be market-based policies.

Market-based policy is unlikely to take the place of traditional types of policy. What it can do is efficiently direct government resources and private resources to achieve conservation goals that complement this traditional body of regulation. For instance, if existing regulation was providing insufficient protection to biodiversity on undeveloped lands, then a district could promote a banking model of public policy that makes such lands within their jurisdiction more profitable to conserve. They could also dictate, through the assignment of credits, the land that will provide the greatest monetary compensation, if preserved. This would require the formulation of regulations to serve as drivers of need. While such efforts are bound to meet resistance from landowners, they will be justified through established goals and implemented at the local level, allowing for local people to have some say about the tools that are used to achieve these goals.

An earlier assertion in this paper suggested that market-based public policy might best be used to fill gaps and work around the margins of traditional public policy. Mitigation banks are particularly well suited for filling gaps, and payments for ecosystem services are particularly well suited for marginally increasing protections. Through special districting for biodiversity, any given district could assess the effects of development on the biodiversity within their jurisdiction and demand compensatory mitigation for all additional development, thereby filling the gap. If ecosystem degradation was widespread enough and incremental gains were necessary over the whole district, then a payment system might be established to achieve these gains. In either case, the district would be reliant on existing regulation to form a baseline of protection for biodiversity, and then make use of additional market-based policies to meet reasonable goals set beyond this baseline.

Overall, special districts for biodiversity use bonds created through the natural environment as a starting point for creating government — whether they are called ecoregions or something else. In such a model, special districts could aid in making the preservation of biodiversity more strategic by focusing public preservation efforts where they are needed, using local input and a flexible set of policy alternatives. Special districts do have their drawbacks as "they tend to be creatures of expedience" and "are established because it seems the sensible thing to do in a particular case, not to fulfill some grand design" (Foster 40).  However, if they consider the existing policy environment within which they are to operate and recognize their own complimentary contribution, they will fill some greater design, perhaps even a grand one.

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