Clean Water Solutions for Iowa
Water Strategies Need Tough Pollution Limits to Work
New Report Cites Lessons From Midwest Projects
Posted Wednesday, January 13, 2009
Full Report (16 pages) PDF
Executive Summary (2 pages) PDF

Initiatives to address water quality problems need to be backed by enforceable and sufficiently strong requirements that limit pollution, Iowa State University researchers said today.

"Our study of water-quality programs in the Midwest makes that clear: In the absence of stringent standards, even well-designed programs cannot work," said Catherine Kling, an economics professor and head of the Resource and Policy Division in ISU's Center for Agriculture and Rural Development.

Kling and Subhra Battachariee, an economics doctoral student at ISU, examined two approaches to water-quality improvements: water-quality trading and wetland banking.

"In both cases, evidence is too scant to support a recommendation that Iowa adopt either approach," Battachariee said. "However, both are worth more study."

Their report for the nonpartisan Iowa Policy Project (IPP) concluded Iowa should establish pilot programs in individual watersheds, using the lessons from other Midwest states as a starting point, to study the costs and benefits of permit trading and wetland banking and then expand successful programs to larger areas.

For water quality trading, which allows trading of pollution credits, the researchers examined programs in Minnesota, Illinois and Wisconsin. Trading credits allows polluters to purchase permits to increase their pollution, in exchange for other polluters reducing their pollution by comparable or greater amounts in the same watershed.

"Wisconsin has a strong water quality trading program ó but there's little incentive for polluters to participate because pollution standards are too weak," Kling said noting only one of Wisconsinís pilot projects generated any permit trading.

The study also recommended allowing polluters to adopt least-cost, effective methods to mitigate pollution, rather than specifying technology, and assuring that all environmental impacts are included in cost-benefit analyses of projects.

Wetland banking projects in Missouri, Minnesota and Iowa showed the researchers that farmers can benefit from increased usable land by participating in such programs where they are allowed to destroy existing wetlands and build new ones to compensate for the loss.

At the same time, they found that the location of newly constructed wetlands makes a difference for whether there are any water quality benefits. There can be water quality benefits if a wetland is placed between farmland and a stream, where the wetland could intercept and filter nutrient runoff.

"In other words, wetland bank programs aren't currently designed for the purpose of improving water quality, but to compensate for lost wetlands. However we can see ways both purposes can be served," Bhattachariee said. "Wetland banking should take a comprehensive approach, as well. It is not just the size of a wetland, but the quality of the wetland that also makes a difference in whether there are water-quality benefits."

The full 16-page report and a two-page executive summary are available at

"We do know water quality is an issue that Iowa should not ignore," Kling said. "As recently as 2006, pollution in 34 percent of Iowa water bodies examined was too great for swimming, fishing, drinking or maintaining healthy aquatic life. We need to do better than that."

The Iowa Policy Project is a nonpartisan, nonprofit public policy research organization in Iowa City. IPP reports on energy and environmental issues, tax and budget policy and economic opportunity and jobs are on the web at