    [From the U.S. Government Printing Office, www.gpo.gov]

            H T)

                                    BARRIER ISLAND DEVELOPMENT
                                   NEAR FOUR NATIONAL SEASHORES

                                         Prepared for the

                                 Council on Environmental Quality

        V)
                               Federal Emergency Management Agency,
                                 Federal.Insurance Administration

                                   Department of the Interior,
                                    Fish and Wildlife Service
                                                and
                                      National Park Service

                                     Department of Commerce,
                        National Oceanic and Atmospheric Administration,
                                Office of Coastal Zone Management

                                         property of CSC Libra"

                                                 By
                                     Sheaffer & Roland, Inc.
                               Chicago - Washington, D.C.     Denver

                                             April 1981

            HD                        U . S . DEPARTMENT OF COMMERCE NOAA
            258                       COASTAL SERVICES CENTER
          j

             B275                     2234 SOUTH HOBSON AVENUE
            1981                      CHARLESTON, SC 29405-2413

                                            CONTENTS

                                                                           page
                ACKNOWLEDGMENTS

                LIST OF
                TABLES                                                      iv

                EXECUTIVE SUMMARY                                             1

                INTRODUCTION                                                13
                    Purposes of Study                                       13
                    Data Collection and Evaluation                          16

                SYNOPSIS OF CASE STUDIES                                    17
                    Trends in Land Value                                    17
                    Access                                                  24
                    Water Supply                                            32
                    Wastewater Management                                   35
                    Disaster Assistance                                     40
                    Flood Insurance                                         45

                IMPLICATIONS FOR FEDERAL POLICY                             51
                    Development Policy                                      51
                    Protection Policy                                       54
                         Protecting Noncontiguous Barrier islands           56
                         Regulating Contiguous Barrier Units                59
                         Benefits of an Acquisition Policy                  63
                    Conclusion                                              66

                REFERENCES                                                  68

                                       ACKNOWLEDGMENTS

                    Many people assisted in this study of barrier island
                development. We particularly want to acknowledge the work of
                Malcolm F. Baldwin, Senior Advisor, President's Council on
                Environmental Quality, for his efforts leading to the study
                and for his guidance while it was being completed. For her
                sensitive and knowledgable editing of this study, Irene
                Gordon has our special thanks and admiration.

                    More than one hundred individuals were interviewed and
                contributed to the case studies. Their knowledge of the case
                study communities and the history of local development was-
                invaluable to us. These people are too numerous to name, but
                they have our thanks and appreciation.

                    Project staff for Sheaffer & Roland, Inc. were: J. David
                Mullen, Economist; Louis T. Rozaklis, Environmental Engineer;
                and Penny Wallingford, Planner. H. Crane Miller was the
                Principal Investigator and is responsible for the technical
                adequacy of the study. John R. Sheaffer, President, provided
                overall direction and guidance.

                                           TABLES

                                                                         page

                         Undeveloped, Unprotected Barrier Island          15
                         Acreage on the Atlantic and Gulf of Mexico
                         Coasts (September 1980)

                2        Oceanfront Land Sales in Study Communities       19
                         Cost per Acre

                3        Chronology of Vehicular Access to Study          26
                         Communities, Funding Sources, and Periods
                         of Principal Development

                4        Costs of Access to Study Communities             31

                5        Water Supply Systems Costs in the Study          36
                         Communities

                6        Costs of Wastewater Facilities in Study          41
                         Communities

                7        Federal Funds for Disaster Response and          44
                         Recovery, Bridge Construction, and
                         Airport Repairs - Hurricanes Camille,
                         Frederic, and Allen

                8        Flood Insurance in Force and Claims Paid         46
                         in Study Communities

                9        Comparison of National Flood Insurance           47
                         Experience with Experience in Study
                         Communities (1978-1980)
                10       Comparison of Pre- and*Post-Hurricane Flood      49
                         Insurance Coverage (Mobile County, Alabama;
                         Pensacola Beach, Florida; and South Padre
                         Island, Texas)

                11       Federal Expenditures in Three Study Areas in     52
                         Relation to Developed Acreage

                12       Estimated Potential Costs of Developing          53
                         Barrier Islands in April 1980 Inventory
                         Based on Present Worth of Current Federal
                         Programs

               13       Estimated Potential Costs of Developing           55,
                        Barrier Islands in August 1980 Inventory
                        Based on Present Worth of Current Federal
                        Programs

               14       Comparison of Estimated Potential Costs of        64
                        Public Purchase of Barrier Islands Versus
                        Estimated Potential Costs of Current Federal
                        Programs to Support Island Development

                                                                            IV

                                      EXECUTIVE SUMMARY

                Introduction

                    The first line of storm defense for a thousand miles of
                Atlantic and Gulf coastlines is their barrier islands -- a
                succession of low-lying, narrow islands, spits, and bay
                barriers generally located parallel to the mainland coast.
                These are geologically recent structures formed by
                interactions of waves, currents, tides, winds, and sediments.

                    The National Park Service has identified nearly 250
                barrier-island units along the two coasts, consisting of
                single islands or clusters of barrier structures. Barriers
                generally consist of sands or other kinds of unconsolidated
                sediments. On their seaward side, the barriers are more
                often fronted by a beach; on the mainland side, by highly
                variable zones of wetlands. (See Figure 1.)

                    Development on barrier islands is a gamble between time
                and nature. The islands change position, often very rapidly,
                in response to storms, changes in water level, and changes in
                current patterns. The barriers are generally receding toward
                the mainland, responding to the progressive rise of sea
                level. Among the hazards are the migration of old inlets,
                formation of new inlets during storms, and storm overwash
                that can undermine foundations by liquefying soil. The
                combination of rising water level, coastal storm surges, wave
                action, and high winds make development hazardous on many
                parts of the islands.

                    Despite the hazards, development on barrier i'slands has
                been growing at a rate greater than 6,000 acres per year.
                That rate, if applied to the remaining undeveloped islands
                identified by the National Park Service, could consume the
                developable upland portions of those islands by the year
                .1995, just 15 years from now. In 1950, only some 90,000
                acres were developed; the Department of Interior reported
                that 228,680 acres were developed by 1973-74, and an
                estimated 280,000 acres by 1980.

                The Study

                    In recent decades the federal government has acquired
                several barrier islands and established them as national
                seashores. This report explores the impact of public land
                acquisition on land values on adjacent barrier islands and
                mainland communities. It analyzes the developmental history
                of communities near four national seashores on the southeast

                                                                                                  FIGURE 1.
                                                           EXAMPLES OF BARRIER STRUCTURES

                                                              BAY BARRIERS                                BARRIER SPITS                         BARRIER ISLANDS

                                                                       BAY HEAD
                                                                                                              0                              E TUARY

                                                                                                                                                                   INLET

                                                                -7                                                   INLET

                                                                               Source: Oceanu  No. 23, Vol. 4, Winter 1980-81
                                                                                      with permission of Woods Hole Oceanographic Institution.

                Atlantic and Gulf of Mexico coasts. Case studies were
                carried out in the following areas:

                State              National Seashore               Adjacent
                                  (Authorization Date)       Counties,Communities

                North Carolina     Cape Hatteras (1938)      Dare County; Nags
                                                             Head; Kill Devil
                                                             Hills

                Georgia            Cumberland Island         Camden County; St.
                                   (1972)                    Marys; Glynn County;
                                                             St. Simons Island;
                                                             Sea Island

                Florida,           Gulf Islands (1971)       Dauphin Island,
                Alabama,                                     Alabama; Pensacola
                Mississippi                                  Beach, Florida

                Texas              Padre Island (1962)       Cameron County;
                                                             South Padre Island

                    The study focused on several questions. Had withdrawing
                the land for national seashores had a significant impact on
                land values in neighboring communities? How had development
                in these communities been affected by the accessibility of
                the community itself or by the accessibility of the national
                seashore? Had other external factors, including the adequacy
                of water supply and wastewater treatment and the availability
                of flood insurance, been a significant factor? Had community
                development or expansion been influenced by federal
                assistance programs and policies, and at what cost? Finally,
                is federal acquisition of national seashores a cost-effective
                policy for protecting barrier islands from unsuitable
                development?

                MajorFindings

                    Trends in Land Value

                    Increases in real estate values in communities adjacent
                to the four national seashores and directly attributable to
                federal land acquisition were not immediately measurable in
                communities that had not reached or approached full
                development.

                    Impacts on land values in adjacent communities from the

                                                                                    3

                withdrawal of federal lands from the marketplace may be
                delayed tens or scores of years after seashore acquisition,
                depending on the rate at which adjacent communities grow. In
                adjacent communities approaching full development, impacts of
                federal land acquisition on land values can be identified and
                measured.

                    External factors (road access, urban infrastructure and
                utilities, septic system moratoria, and naval bases) had a
                more immediate and measurable impact on land values in
                adjacent communities than did acquisition of the national
                seashores.

                    Access

                    Development on adjacent barrier islands was nonexistent
                or negligible until vehicular access by road, causeway, or
                bridge was available. However, convenient access per se did
                not lead immediately in every case to extensive development
                in the adjacent communities.

                    Where no road access exists to the national seashore,
                development in adjacent communities (whether on the mainland
                or on adjacent barrier islands) has not been measurably
                affected by federal acquisition of the national seashore,
                c.f., Cumberland Island, Gulf Islands (Mississippi islands).

                    Where road access exists to the adjacent community
                independent of road access to the national seashore,
                development and land values in the adjacent community are not
                measurably affected by seashore acquisition, c.f., Dauphin
                Island, South Padre Island.

                    In all instances studied, initial development of road,
                bridge, or causeway systems was financed by private, local,
                and state interests. Federal participation came later,
                through funding the improvement or replacement of existing
                systems. (The substantial costs of these and other federal
                assistance programs are discussed in later sections.)

                    Water Supply

                    In several adjacent communities that are on barrier
                islands, increasing density of development caused them to
                rely on mainland sources for water.

                    Only two communities studied still obtain 100 percent of
                their potable water from wells on the island, and these
                systems are being affected by salt water intrusion and

                4

                infiltration and inflow of polluted waters. Both communities
                have septic system or building moratoria in effect to
                restrict new development.

                    Availability of water from island or mainland sources has
                not been a constraint on development in most of the study
                areas. An exception is South Padre Island, where the
                availability and cost of additional water rights are limiting
                further development.

                    Federal expenditures (in the form of low interest loans,
                grants, and donation of federal property) contributed to
                establishing or upgrading water supply systems in some of the
                study areas. Community systems in the Nags Head - Kill Devil
                Hills area and on St. Simons Island benefited from federal
                loans and sale of excess property, respectively. Expansions
                of existing systems in South Padre Island and Nags Head -
                Kill Devil Hills also received federal grants and loans. A
                currently planned expansion to the facilities at Dauphin
                Island awaits similar federal aid.

                    Wastewater Management

                    In all communities studied, initial development relied
                primarily on septic systems for disposal of wastewater; as
                development increased, septic systems tended to exceed the
                capacity of local soils to assimilate the wastes.

                    In all study communities, the provision of a complete
                sewerage system and wastewater treatment facilities has
                become a requisite for prevention of environmental
                degradation and for continued development on the islands.
                Septic system moratoria were in effect in Kill Devil Hills,
                Dauphin Island, and St. Simons Island, when the case studies
                were conducted.

                    In only one of the study communities were federal monies
                for wastewater management systems expended as part of the
                initial costs of development of the islands. The original
                wastewater treatment plant and sewer system on St. Simons
                Island was built by the U.S. Navy and sold as excess property
                to Glynn County in 1947.

                    Federal funds spent so far in connection with wastewater
                management in the study communities are: 201 planning funds
                for wastewater treatment facilities and one construction
                grant (at South Padre Island). The federal contribution is
                estimated to be $3.3 million.

                                                                            .5

                     Two of the study areas are currently seeking federal
                 construction grants for new or expanded wastewater treatment
                 facilities: Dauphin Island, Alabama ($3.5 million) and Dare
                 County, North Carolina ($7.5 million).

                     Disaster Assistance and Flood Insurance

                     Federal disaster assistance funds of at least $43 million
                 will be expended in two of the study communities as a result
                 of Hurricanes Frederic and Allen. Major disasters had been
                 declared in the remaining states studied between 1953 and
                 1964, but none had been declared in them from 1965 to 1980.

                     Flood insurance coverage in the study communities
                 currently exceeds $578 million. Claims totaling $17.8
                 million were paid in the study communities in the period
                 January 1978 to November 1980. Sharp increases in the total
                 number of policies and total flood insurance coverage were
                 noted following Hurricanes Frederic and Allen.

                     Federal Policy Implications

                     Current federal programs support development, effectively
                 leveraging private development money by shifting to the
                 public sector portions of the costs of bridges, roads,
                 causeways, water supply systems, wastewater treatment
                 systems, shore protection, disaster relief, and flood
                 insurance. Documented federal expenditures in three of the
                 study areas represent an average subsidy of $25,570 per
                 developed acre in actual dollars expended or obligated, and a
                 total expenditure of more than $96.7 million for 3,784
                 developed acres.  When restated as 1980 replacement costs,
                 federal subsidies in the three areas averaged $53,250 per
                 developed acre.

                     These figures are consistent with estimates made by
                .Sheaffer, Miller and Rozaklis in 1980 of the potential
                 federal costs under current programs if the remaining
                 undeveloped, unprotected barrier islands were to be
                 developed-' Those estimates range from $25,800      $26,400 per
                 acre, assuming low developed acreage, to $43,700      $46,700
                 per acre, assuming high developed acreage. As modified by
                 Miller to the August 1980 National Park Service inventory of
                 undeveloped,.unprotected barrier island acreage, the
                 estimated cost to the federal government of funding barrier
                 island development under current programs could range from
                 $2.46 - $6.05 billion over the next 20 years.

                     If the federal goal is to protect remaining barrier

                 6

                islands, policy should distinguish between the
                "noncontiguous" islands, i.e., those barrier islands not
                contiguous to developed areas and accessible principally by
                boat (about 138,100 acres) and "contiguous" barrier units,
                i.e., those barrier islands, barrier spits, and bay barriers
                immediately adjacent to developed areas and generally
                accessible by roads, bridges, and causeways (about 138,800
                acres).

                    Protecting Noncontiguous Barrier Islands

                    The noncontiguous islands present the greatest range of
                opportunity for protecting and preserving the barrier
                islands. The opportunity is greatest before development
                begins; enforcement of strong federal policies on issuance of
                bridge permits could effectively preclude intense development
                and protect the noncontiguous islands without public
                acquisition. Each subsequent stage of development diminishes
                the effectiveness of federal, state, and local regulations,
                and increases the federal financial assistance required to
                mitigate or "correct" adverse conditions.

                       A Federal protection policy would be enhanced by
                       continuing the historic federal position not to
                       participate in the initial costs of barrier island
                       access and other urban infrastructure.

                    In almost all study areas, the initial costs of access
                and other urban infrastructure (e.g., water supply,
                utilities, wastewater treatment, etc.) were borne by private,
                local, or state interests, or some combination of this
                funding. Financing was achieved primarily through sale of
                local or state revenue bonds, land sales, or private
                investments. Federal involvement characteristically came at
                subsequent stages of development. Continuing federal
                nonparticipation in the initial costs of barrier island
                access and other urban infrastructure would enhance a
                protection policy.

                       The critical focal point for a federal protective
                       policy toward the remaining undeveloped, noncontiguous
                       barrier islands is road, bridge, and causeway access.

                    Most barrier island development would not have taken
                place without bridge, causeway, and road access. A federal
                protective policy toward the remaining noncontiguous islands
                would logically seek to retain the islands in their natural
                condition, and prevent or inhibit development through a

                                                                            7

               variety of actions before initial development. The key to
               barrier island development is access. Therefore, bridge
               permits play a pivotal role in the development of the barrier
               islands.

                      Development of most undeveloped, noncontiguous barrier
                      islands could be effectively regulated if
                      bridge/causeway permits were (1) denied or (2) granted
                      subject to enforced federal standards and without
                      federal subsidization.

                   Federal regulatory authority over bridge permits is
               uniquely strong (by virtue of the navigation servitude under
               the Commerce Clause of the Constitution). Denial of a bridge
               permit would effectively preclude most extensive development
               of barrier islands.

                   When bridge or causeway permits are approved, development
               can be limited by requiring compliance with federal standards
               and permit conditions, and prohibiting federal cost sharing
               of construction, improvements, repairs, or replacement,
               except under stringent exceptions. The capital costs of
               building bridge/causeway systems to federal standards
               currently range from $10 - $30 million per mile. Imposing
               such costs on the private sector would greatly affect the
               economics of barrier island development, making much of it
               economically infeasible. Bridges and causeways are the neck
               of the funnel leading to and from the barrier islands.
               Control of the neck of the funnel can effectively determine
               whether development takes place initially.

                   Regulating Undeveloped, Contiguous Barrier Units

                   Access and development cannot be so simply directed on
               contiguous barrier units. These barrier islands, barrier
               spits, and bay barriers, are by definition near existing
               roads and urban infrastructure. Estimates showed that
               "contiguous" barrier units are, on average, within 0.4 miles
               of existing road systems on both the Atlantic and Gulf of
               Mexico coasts.

                      For readily accessible barrier communities, federal
                      regulations are not designed to and will generally not
                      prevent or inhibit development in the long term, but
                      can reduce or mitigate some potentially adverse
                      consequences.

                    Regulation of barrier island development generally
                implies minimum standards for building practices and land
                uses. The added costs of these regulations cannot be
                expected to prevent development. They are not designed to do
                so. Moreover, in the case of flood insurance regulations,
                property owners and local governments can recover most or all
                of the costs of complying with elevation requirements through
                reduced flood insurance premiums and reduced average annual
                flood losses.

                    Standards and regulations will not be adequate alone,
                however, to achieve the recently articulated federal goal "to
                achieve an abs9lute decline in communities' average annual
                flood losses."   Design of buildings to minimum standards can
                only reduce losses up to the design and safety limits of the
                structures. A storm that exceeds these design and safety
                limits can then produce catastrophic results. The chances
                for such a storm over a 50-year building life expectancy are
                relatively high (1-in-4 for a 200-year storm such as
                Hurricane Camille). Continued development, even to minimum
                standards, increases the potential for catastrophic loss in
                large, rare storms. Moreover, community losses from damage
                to roads, water systems, and other urban infrastructure can
                be expected from storms of considerably lesser magnitude,
                adding to potential disaster relief expenditures.

                       Removal of federal subsidies for developing contiguous
                       barrier units can be expected to inhibit but not
                       prevent development of those contiguous areas.

                    Removal of federal subsidies for developing contiguous
                barrier units would shift significant portions of the costs
                from the federal to the state, local or private sectors.
                However, these communities are so near access and urban
                infrastructure that the capital costs of extending these
                services would in many instances be economically feasible.

                    Removal of federal subsidies for access and other urban
                infrastructure on the undeveloped contiguous barrier units
                would reduce federal costs, but would not necessarily
                preclude development. Continued federal expenditures for
                increased disaster relief and flood insurance can be
                anticipated, unless federal disaster assistance and flood
                insurance programs are modified to further mitigate hazards.

                     Benefits of an Acquisition Policy

                       A federal protection policy will be strengthened by

                        authority and appropriations to acquire both
                        undeveloped contiguous and noncontiguous barrier
                        islands. Public acquisition of the islands is cost
                        effective, and the surest means to protect barrier
                        islands from inappropriate development.

                    Acquisition costs of the National Seashores included in
                this study ranged from $75.35 per acre at Cape Hatteras
                (1950-1954) to $4,950 per acre at Gulf Islands National
                Seashore (1970-1974). Using an average-purchase price of
                $5,000 per acre, recent estimates indicate that acquisition
                costs could be one-fifth or less of the costs to the federal
                government of continuing its current development programs on
                the undeveloped barrier islands.

                    Even at costs of $5,000-$10,000 per acre for the upland
                portions of contiguous units, acquisition costs are estimated
                to range no higher than $275-$550 million, and for the
                noncontiguous islands $185 to $370 million. Total
                acquisition costs for all contiguous and noncontiguous
                undeveloped upland acreage on the barrier islands would range
                from $460 to $920 million. Developing the barrier islands
                under cur*rent federal programs is estimated to range between
                $2.46 billion and $6.05 billion, 2.5 to 5 times the
                acquisition costs. (See Table 14 of the report.)

                    Under a public acquisition program, priorities can be
                divided generally between contiguous and noncontiguous
                barriers. In many, if not most, instances first priority
                should be given to purchase of undeveloped contiguous units,
                based on such objective factors as physical characteristics,
                resource values, and threats to those resource values
                (imminent development, pollution, loss of habitat, loss of
                open space, etc.).

                    A public acquisition program on the noncontiguous islands
                would not be required, if the federal government chooses to
                adopt a more stringent bridge permit program than is now in
                force, and if such regulations withstood inevitable judicial
                challenge, extensive development of the undeveloped
                noncontiguous barrier island would be effectively precluded
                and acquisition could be directed to contiguous barrier
                islands.

                    As with any form of regulation, public acquisition before
                development takes place would be the most cost effective
                action. At each incremental stage of access and urban
                infrastructure development, adjacent land values will

               10

                increase. The Government would get the most for its money
                before such development takes place.

                    If the history of National Seashore acquisition and the
                increase of coastal land values is any precedent, costs in
                the range of $5,000-$10,000 per acre will be deemed sound and
                inexpensive investments not even 10 years from now; not only
                would they be inexpensive, but they would also be "repaid" in
                reduced or avoided federal subsidies and disaster relief
                expenditures.

                    An acquisition program would effectively avoid or reduce
                costs to repair, improve, enlarge, upgrade, reconstruct, or
                replace bridges, roads, causeways, water supply systems,
                wastewater treatment systems, flood and erosion control
                structures, or to provide disaster assistance and to
                subsidize flood insurance for the areas acquired.

                    Where development in adjacent communities has not reached
                or is not approaching saturation, federal acquisition of
                noncontiguous barrier islands would have no measurable effect
                on land values in those communities. other factors,
                especially improved urban infrastructure, will have a more
                immediate effect on adjacent community land values than
                public acquisition of the noncontiguous islands.

                    Undeveloped, contiguous tracts will reflect market values
                of developed lands nearby. In one instance cited, the asking
                price for one parcel of land included in the National Park
                Service inventory of undeveloped barrier units is nearly six
                times the average estimated present value of remaining
                undeveloped noncontiguous islands. The smaller the acreage
                involved, the greater the likelihood of high cost per acre.
                Nevertheless, viewed as a totality, the average acquisition
                costs per acre for "bulk" land purchases of uplands,
                wetlands, and interior waters is expected to fall in the
                range of $5,000-$10,000 per acre.

                       To the extent that adjacent areas are totally or
                       significantly developed, public acquisition of
                       undeveloped, contiguous parcels would be expected to
                       increase the value of adjacent lands.

                    Removal of lands from the marketplace near communities
                that are highly developed was shown in at least one instance
                in the study to have increased property values in that
                community. Both the perception and the fact of reduced
                supply of land will increase the value of the remaining lands

               outside the publically-acquired property where development
               has reached or approaches saturation.

               Conclusion

                   "Protection" measures such as regulations and removal of
               federal subsidies for access and urban infrastructure may
               forestall some barrier island development but generally will
               not prevent development. Among all regulations only a
               strengthened bridge permit program, coupled with removal of
               federal bridge construction funds, is likely to protect
               barrier islands from development, and then only with respect
               to noncontiguous islands. Regulations on access, urban
               infrastructure, and building requirements, and removal of
               federal subsidies are important short-term measures; but
               their limitations as means to protect barrier islands need to
               be recognized.

                   If protection of the undeveloped barrier islands is to be
               a federal goal and is to be effectively achieved, a program
               of regulation, removal of federal subsidies for development,
               and public acquisition would need to be authorized and funds
               appropriated for that purpose. Such a combined program is
               the only effective way to protect the islands, and, through
               acquisition, the only fair way to compensate individual
               barrier island property owners for taking their right to
               develop the islands. of all the available measures, the
               surest means to protect the undeveloped barrier islands is
               public acquisition.

              12

                                            INTRODUCTION

                    The barrier islands are the first line of storm defense
                for a thousand miles along the Atlantic and Gulf coasts.
                Development on them is a gamble between time and nature, as
                evidenced in recent years by Hurricanes Frederic, Camille,
                and Allen. Yet people continue to be drawn to their sunny
                beaches and to risk building on the islands.

                    Development on barrier islands has been growing at a rate
                greater than 6,000 acres per year. That rate, if applied to
                the remaining barrier islands, could consume the developable
                upland portions of those islands by the year 1995, just 15
                years from now. By 1980 an estimated 280,000 acres had been
                developed.

                    In recent decades the federal government has acquired
                several barrier islands and established them as national
                seashores. The report explores the impact of such public
                land acquisition on adjacent barrier islands and mainland
                communities.

                Purposes of the Study

                    This study was undertaken as part of the consideration of
                alternative fedeial policies for protecting the nation's
                barrier islands.     This report describes and analyzes the
                developmental history and recent trends affecting economic
                and environmental conditions in four case study areas of the
                southeast Atlantic and the Gulf of Mexico coasts adjacent to
                or near national seashores:

                State              National Seashore       Counties, Communities

                North Carolina     Cape Hatteras (1938)    Dare County; Nags
                                                           Head; Kill Devil Hills

                Georgia            Cumberland Island       Camden County; St.
                                   (1972)                  Marys; Glynn County;
                                                           St. Simons Island; Sea
                                                           Island

                Florida,           Gulf Islands (1971)     Dauphin Island, AL;
                Alabama,                                   Pensacola Beach, FL
                Mississippi

                Texas              Padre Island (1962)     Cameron County; South
                                                           Padre Island

                                                                                   13

                     There are approximately 1.4 million acres of uplands,
                 wetlands, and interior waters included in the federal
                 inventory of barrier structures on the Atlantic and Gulf of
                 Mexico coasts. An estimated 885,000 acres (more than 60
                 percent) are in public ownership, owned by federal, state,
                 and local governments and protected from development. Nearly
                 280,000 acres have been developed, about 190,000 within the
                 last 30 years. Somewhat less than 280,000 acres are
                 undeveloped, in private ownership, and potentially subject to
                 development. See Table 1.

                     Nearly 95 percent of the undeveloped, unprotected barrier
                 acreage is found from Virginia south along the Atlantic coast
                 and along the Gulf coast. More than 40 percent of that
                 acreage is in Texas; another 43 percent is in North Carolina,
                 South Carolina, Georgia, and Florida. Hence, the areas
                 selected for case studies are both representative of and
                 dispersed throughout the geographic area with the greatest
                 remaining undeveloped, unprotected barrier island acreage.
                 The case study method was used to document developmental
                 history within each study area and to discern recent trends
                 affecting those areas.

                     One purpose of the study was to assess the impact of
                 federal land acquisition on land values in communities
                 adjacent to but outside the boundaries of national seashores.
                 Concern had been expressed that as the supply of land
                 available for development is diminished by federal land
                 acquisition, and demand for land remains steady or increases,
                 the effect of federal land acquisition will be to increase
                 the price of remaining land sharply. The study tested that
                 concern.

                     A second major purpose of the study was to document
                 federal involvement in development, expansion, and
                 redevelopment of the study communities. The economic
                 feasibility of barrier island development is influenced by a
                 number of factors, including access to the islands, urban
                 infrastructure to support development, and -- ultimately
                 shore protection measures to counteract the effects of rising
                 sea level, currents, winds, waves, storms, and erosion.

                     Extensive barrier island development cannot take place
                 without access, water, and other urban infrastructure to
                 support that development. Access and urban infrastructure
                 are broad areas in which current federal programs can provide
                 substantial direct subsidies to foster development. The
                 study documented the sources and costs for such basic factors

                14

                 Table 1.   Undeveloped, Unprotected Barrier Island Acreage on the Atlantic
                 and Gulf of Mexico Coasts (September 1980).

                                             Contiguous Units 1 Noncontiguous Uni s  2
                                                              3 -
                                             Uplands Wetlands   Uplands      Wetlands       State
                 State                       (Acres) (Acres)    (Acres)       (Acres)       Total

                 Maine                          702        136          0           0         838
                 Massachusetts                3,226      1,447      1,276       1,027       6,976
                 Rhode Island                   777        432          70          0       1,279
                 Connecticut                      72       203          22          29        326
                 New York                     1,327        535          0           0       1,862
                 New Jersey                        60      290          0           0         350
                 Delaware                       156        200          0           0         356
                 Virginia                           0         0     1,786       6,58T       8,373
                 North Carolina               2,608      5,065      1.939      12,235     21,847
                 South Carolina               6,288      8,915      4,293      21,064     40,560
                 Georgia                            0         0     5,706      23,084     28,790
                 Florida                     14,176      8,174      1,040       3,176     26,566
                 Alabama                        465      1,162          0           0       1,627
                 Mississippi                        0         0     1,970       1,325       3,295
                 Louisiana                      860      4,972      4,151      11,744     21,727
                 Texas                       24,797      51,770     15,459     20,088     112,114
                 September 1980 Totals       55,514      83,301     37,712     100,359    _@_76,'W%
                 1  "Contiguous Units"   are those undeveloped,   unprotected barrier struc-
                 2  tures contiguous to partially or totally developed areas.
                    "Noncontiguous Units" are totally undeveloped, unprotected barrier
                    islands not contiguous to partially or totally developed areas, and
                 3  generally only accessible by boat.
                    Wetland acreages include interior waters.

                 Source: Sheaffer & Roland, Inc., using:
                       Summary of the Undeveloped and Unprotected Natural Areas on Barrier
                       Islands Along the Atlantic and Gulf Coasts-U.S.Department of the
                       Interior, National Park Service (Washington, D.C., April 1980).
                       Table 1, Barrier structures and parts of structures listed in April
                       1980 National Park Service inventory that have been determined to be
                       protected by existing owners and deleted (revised to Sept. 9, 1980).
                       Table 2, Other barrier structures or parts of barrier structures
                       deleted from April 1980 National Park Service inventory (revised to
                       Sept. 9, 1980).
                       Table 3, Barrier structures determined to qualify for addition to the
                       inventory of undeveloped and unprotected barrier structures (revised
                       to Sept. 9, 1980).

                                                                                                15

                as:

                         access: bridges, causeways, roads, and airports;
                         water supply and distribution;
                         wastewater collection and treatment; and
                         protection against flood losses.

                    Each of these categories was assessed separately.
                Private, local, state, and federal sources of financing were
                documented where available. Specific development factors
                were assessed over time by examining building permits,
                traffic counts, and property transfers and sales. The
                influence of federal acquisition of the national seashores
                was measured and evaluated by means of time series analysis.
                Effects of federal subsidies on land use and value, and on
                pressures to develop the communities were also assessed by
                examining changes over time.

                    In each case study external factors were evaluated to
                assess their impacts. These external factors included

                    -    military and naval bases
                    -    adjoining public holdings other than national
                         seashores
                    -    tourist facilities and attractions
                    -    significant nearby development, e.g., major
                    metropolitan areas, and
                         offshore oil and gas exploration and exploitation.

                To the extent identifiable, the impact of external factors
                were compared with the impact of the national seashores on
                development in the adjacent communities.

                Data Collection and Evaluation

                    Each case study focused on the national seashore itself
                and on private development nearby on the same barrier island,
                on separate but adjacent barrier islands, or on the mainland.
                Each was studied separately to determine its developmental
                history and trends in land use and land value. Available
                planning and other documents were reviewed; locally
                influential and knowledgeable individuals were interviewed;
                and primary data relating to building permits, property
                sales' and property transfers were collected and analyzed.
                The urban infrastructure in each case study area was
                evaluated and, where possible, the costs of building the
                infrastructure were collected and analyzed.

               16

                                  SYNOPSIS OF CASE STUDIES

                   Although the developmental history of each study
               community was unique, some characteristics are typical not
               only of other study areas but also of other barrier units
               along the Atlantic and Gulf coasts. For example, Cumberland
               Island and the Mississippi islands of the Gulf Islands
               National Seashore have little or no development on them and
               no road access from the mainland. They share these
               characteristics with more than 50 undeveloped, privately
               owned barrier islands comprising about 138,000 acres that are
               not contiguous to developed areas and are currently
               inaccessible by road, bridge, or causeway. The Cape
               Hatteras, Padre Island, and Florida portions of the Gulf
               Islands National Seashores are accessible by road and
               contiguous to developed and developing areas. They share
               these general characteristics with approximately 80
               undeveloped, unprotected barrier units comprising about
               139,000 acres. Thus, the four national seashores included in
               the study are broadly representative of the remaining
               undeveloped, unprotected barrier structures of the Atlantic
               and Gulf coasts.

                   This synopsis focuses on a number of the common
               characteristics of the study areas related to land values,
               access, urban infrastructurer and external factors affecting
               development. Each finding is discussed and supported by the
               data collected, interviews held, and analyses made during the
               field work for the study.

                   Trends in Land Value

                      Increases in real estate values in communities
                      adjacent to the four national seashores and directly
                      attributable to federal land acquisition were not
                      immediately measurable in communities that had not
                      reached or approached full development.

                   In all of the study areas except Pensacola Beach,
               Florida, percentages of development and rates of growth were
               low at the time of acquisition of the adjacent national
               seashore. Estimated percentages of development at the time
               of seashore acquisition were:

                                                                            X7

                                                      Seashore
                                                    Acquisition        Percent
                     Community                        Period          Developed
                     Nags Head, NC                  (1953-1959)     Less than  15%
                     Kill Devil Hills, NC           (1953-1959)     Less than  15%
                     South Padre Island, TX            (1966)       Less than  5%
                     St. Marys, GA                  (1974-1979)     Less than  25%
                     Dauphin Island, AL             (1972-1979)     Less than  10%
                     Pensacola Beach, FL            (1972-1979)     About 75%

                Source: Sheaffer & Roland, Inc. estimates from planning and
                          building permit data.

                     Except in Pensacola Beach, development was not proceeding
                vigorously in the study areas when the national seashores
                were acquired. The supply of land available for residential
                and commercial development in the study communities exceeded
                the demand for such land during the Seashore acquisition
                period. Hence, acquisition of the Seashores was generally
                not perceived as putting pressure on development in the
                adjacent communities or on acquisition of scarce land
                resources.

                     Table 2 compares oceanfront land sales in several of the
                communities adjacent to the four National Seashores with the
                purchase and condemnation/taking costs of the four Seashores.
                Readers should note that the land sale data are derived from
                actual sales, but do not necessarily represent extreme highs
                and lows for each given five-year period. Also community
                land sales are based on sales of subdivided, platted lots.
                Such sales are many times more expensive per acre than "bulk"
                land sales characteristic of many Seashore acquisitions.
                Finally, the community land sales shown are the most
                expensive land in each community studies, i.e., oceanfront
                land. Depending on the community, interior lot costs ranged
                from one-third to one-tenth the cost of ocean front lots in
                the study communities. Nevertheless, the data suggest
                several conclusions that were corroborated in the study
                team's interviews.

                     The community property sales data suggest no immediate,
                unusual increase in property values that are directly
                attributable to the Seashore acquisition and not explicable
                by external factors. Some modest increase is noticeable in
                the Nags Head - Kill Devil Hills area, but the acquisition
                period also corresponded with an extensive tourism promotion
                program by the Outer Banks Tourist Bureau. Increased

               18

                                             Table 2. Oceanfront land Sates In Study COMMuniLlea - Costs Per Acre.

                                                           KI  It   11 Hills,    St. St-Z.- -1--mophin                  South Padre          th t: I ona IPurchase     Taking Condemnation
                                             Ile r I od        M g@ I e a d        Sea Island          Island            Island              Seashore Av. Cost/Acre     (Av. Cost/Acre)

                                             1940-44  $    870-$   2,600              NA                 NA                  NA

                                             1945-49  $    870--$  2,600              NA                 NA                  NA

                                             1950-54  $    900-$   2,600              NA                 NA             $  4,400-$   4,800   Cape Hatteras    $75.35          $268.39

                                             1955-59  $   2.600-$  12.200             NA         s 21,800-$ 24,000           NA

                                             1960-64  $   6,500-s  19,200             NA                 NA             $ 2t.300-$ 22,200

                                             1965-69  $  11,300-$  27,400             NA                 NA             $ 12,600-$ 22,700    Padre Island          --         $618.70
                                             1970-74  $  30,5001                $207,550         $ 62,700-s 64,500      $  7,000-$ 78,000    Culf Islands $4,949.04         $39.593 (2.21 Acres)

                                             1975-79  $174,200-$283,100    $398,100-$430,400     $ 54,400-$292,300           NA              Cumberland 1. $3,327.30        $21,316 (102.12 Acres)

                                             1980     $203,400-$464,800               NA         $ 13,900-$204,300      $202,100-$332,800

                                             1Oita Include only one transaction.
                                             ------------------------------------------------------------------------------------------------------------------------------------------------
                                             Source:  SIteaffer & Roland, Inc. using:   Property Sales Ilata; Department or the Interior, National Park Service, Division of land Acquisition,
                                                      Mister Deed Listing, status as of Feb. 29, 1980.

                 visitations tended to coincide with increased building permit
                 activity in some of the study communities.

                    The St. Simons - Sea Island and Dauphin Island data
                 suggest that land values were influenced by factors
                 independent of the Seashore acquisitions. St. Simons and Sea
                 Island, located more than 50 miles north of St. Marys,
                 Georgia (the mainland community closest to Cumberland Island)
                 suggest acquisition of Cumberland Island had no measurable
                 impact on land values on St. Simons and Sea Island. Land
                 values on Dauphin Island also have been influenced by
                 external factors. A moratorium on septic systems that has
                 been in effect since 1976 has had a strong impact,
                 particularly on development and land values on the west end
                 of the island. Development difficulties were exacerbated in
                 1979, when Hurricane Frederic "blew out" the bridge/causeway
                 to the island.

                    South Padre Island data show a depression in land values
                 during the period that the Padre Island National Seashore was
                 being acquired. Davenport has suggested a cause:effect
                 relationship between tge acquisition and the depressed land
                 values in that period.   Before acquisition of the Seashore,
                 a coastal highway was proposed to connect Corpus Christi and
                 South Padre Island, running the length of Padre Island. When
                 the Seashore was authorized and acquired, the coastal highway
                 proposal became inoperative. According to Davenport's
                 sources, land values in South Padre Island that were inflated
                 by speculation that the highway would be built were deflated
                 when the Seashore was acquired.

                    However, another factor--the high salinity of the water
                 supply from the mainland--may also have had a depressing
                 effect on land values at South Padre Island. Many realtors
                 cited this salinity (1,100 parts per million of total
                 dissolved solids, including 850 - 900 ppm of salt) as a
                 .deterrent to further development. Both factors coincided
                 with Seashore acquisition and could have had a combined
                 depressing effect on land values.

                    The water problem was mitigated in 1966 when the water
                 district serving South Padre Island found a new nonstagnant
                 source of water and installed underground transmission mains
                 from the source to the treatment plant. However, further
                 development is now hampered by the limited availability and
                 high costs of obtaining additional water rights.

                        Impacts on land values in adjacent communities from
                        the withdrawal of federal lands from the marketplace

               20

                      may be delayed tens or scores of years after seashore
                      acquisition, depending on the rate at which adjacent
                      communities grow.

                   Study data suggest that measurable effects of federal
               land acquisition on adjacent lands are not felt until the
               adjacent areas reach or approach full development. It may
               take decades for development in the adjacent communities to
               reach that point.

                   As late as 1972, nearly 20 years after acquisition of the
               Cape Hatteras National Seashore began, land use maps of Nags
               Head and Kill Devil Hills, North Carolina, showed that only
               the oceanfront had been extensively developed. Interior lots
               and lots bordering Roanoke Sound were virtually undeveloped.
               However, by 1980, Kill Devil Hills was 90-95 percent
               developed and Nags Head was 50 percent developed. Sharp
               increases in land values were being experienced as land
               development approached saturation, and new development was
               being directed to the north of these communities.

                   Measurable effects on land values adjacent to Cumberland
               Island may not be felt for 50 years, according to an official
               of the Sea Island Company, developers of Sea Island and St.
               Simons Island, Georgia. Cumberland is adjacent to rural
               Camden County where the dominant land use is pine forests to
               support the local paper industries. Should the demand
               develop, there are ample lands to meet the needs for any
               foreseeable development of the area immediately adjacent to
               Cumberland Island on the mainland over the next 25 - 50
               years, with no measurable effect on local land values
               attributable to federal acquisition of Cumberland Island.
               The same official of Sea Island Company thought that the
               principal effects of the Cumberland Island National Seashore
               may be aesthetic, the appreciation of a barrier island in its
               natural state contrasted to nearby developed areas.

                      External factors (road access, urban infrastructure
                      and utilities, septic system moratoria, and naval
                      bases) had a more immediate and measurable impact on
                      land values in adjacent communities than did
                      acquisition of the national seashores.

                   The critical role of road access to the barrier islands
               in the development of those islands was borne out repeatedly.
               -- on the Outer Banks, at St. Simons Island and Sea Island,
               at Pensacola Beach and Dauphin Island, and at South Padre

                 Island. Without road, bridge, or causeway access to the
                 islands, extensive recreational, tourist, and permanent
                 development did not occur. The communities on the Outer
                 Banks and on Dauphin Island were largely fishing villages,
                 accessible only by boat or ferry, before bridges and roads
                 were built.

                      Dramatic evidence of the effect of inaccessibility and
                 land use regulations was found on Dauphin Island. Table 2
                 shows the decrease in land values, particularly on the west
                 end of Dauphin Island, after the imposition of a septic tank
                 moratorium in 1976. Building permit data show a sharp
                 decrease in new building starts in 1977, and reduced levels
                 thereafter. Interviews revealed that new buildings are
                 either using holding tanks or remain unconnected, awaiting
                 removal of the septic tank ban. As a result of the
                 moratorium and the destruction of the Dauphin Island Bridge
                 by Hurricane Frederic, some land values are depressed below
                 levels at which the land was first offered in 1955.

                      In St. Marys, Georgia, on the mainland opposite
                 Cumberland Island, development of the Kings Bay Fleet
                 Ballistic Missile Submarine Support Base has dominated the
                 socioeconomics of the area since July 1, 1978, when the Navy
                 took possession of the Military Ocean Terminal from the Army.
                 Designation of the base as an Atlantic Coast Strategic
                 Submarine Base for one TRIDENT squadron is already having
                 profound impacts in the county, as noted in the Environmental
                 Impact Statement for the base:

                      "Camden County has become a center of military employment
                               The region's military population has grown by
                      ;,2*66* 'persons (including spouses and dependents) since
                      the arrival of the Navy's submarine tender at Kings
                      Bay . . . .

                      n
                       . . . The arrival of military personnel on July 2, 1979,
                      increased the county's 1979 population by 12 percent.
                      This growth, coupled with growth of the county's two
                      largest industrial employers (Union Carbide and Gilman
                      Paper), has resulted in some housing shortages, increased
                      competition for qualified employees, and increased
                      traffic.

                      "Real estate values in Camden County communities have
                      registered substantial price appreciation in the last two
                      or three years. Homes that sold for $18,000 in 1976 are
                      now selling for approximately $30,000; raw land near
                      development areas has posted sharper price appreciation

                 22

                     than homes.      ,6

                 With an estimated influx of more than 20,000 people
                 associated with the Kings Bay Support Base by the year 2000,
                 the overwhelming impacts on land values in St. Marys and in
                 Camden County are and will be attributable to the Kings Bay
                 operation for the foreseeable future.

                        In adjacent communities approaching full development,
                        impacts of federal acquisition on land values can be
                        identified and measured.

                     Pensacola Beach, Florida, is the only study community
                 that experienced immediate, measurable increases in real
                 estate values after nearby land was acquired for a national
                 seashore. The City of Pensacola Beach is on Santa Rosa
                 Island. The entire island was once federal property
                 administered by the Department of the Interior, but large
                 portions were transferred to Escambia County, Florida, during
                 the Truman Administration. The County set aside a portion of
                 the island for development as Pensacola Beach, and created
                 the county-run Santa Rosa Island Authority to administer the
                 town. It was bounded on the west by Fort Pickens Park and on
                 the east by an 8-mile county park. Development began in the
                 late 1940s after the county built a bridge and water main to
                 the mainland. -Under the Santa Rosa Island Authority, land in
                 Pensacola Beach was made available solely by long-term,
                 99-year leases for development.

                     When the Gulf Islands National Seashore was established,
                 Fort Pickens State Park was donated by the State to become a
                 part of the Seashore. This had no apparent effect on lease
                 values in Pensacola Beach, although the town was about 75
                 percent developed. However, the study team was told that
                 @hen a 7.5-mile stretch of beach east of Pensacola Beach was
                 incorporated into the National Seashore, leases in Pensacola
                 Beach immediately increased in price. The study team could
                 not quantify the increases, for lack of data.
                     Although tfie creation of Cape Hatteras had no measurable
                 impact on land values in Nags Head and Kill Devil Hills for
                 almost 20 years, there now is the prospect of immediate,
                 measurable land value increases in these communities.
                 Situated in the middle of Nags Head is a 411-acre undeveloped
                 tract that extends from the Atlantic Ocean to Roanoke sound.
                 Still owned by the family that purchased the land in the late
                 1930's reputedly for $4,000 (less than $10.00 per acre), the

                                                                             23

                entire tract is now offered for sale for $12,000,000, or
                $29,200 per acre. The tract is included in the Department of
                the Interior's inventory of undeveloped, unprotected barrier
                units. Several realtors and local officials were questioned
                about the potential impact on local land values if the
                federal government were to acquire the tract. All were
                unanimous in their opinion that such an acquisition would
                immediately increase land prices in all nearby communities,
                because the tract is the last large parcel of undeveloped
                oceanfronting land for 25 - 30 miles outside the National
                Seashore. This prospect is consistent with our finding
                inasmuch as Kill Devil Hills is now estimated to be 90 - 95
                percent developed and Nags Head about 50 percent developed.
                The tract represents a substantial portion of the undeveloped
                land in Nags Head.

                    Access

                      Development on adjacent barrier islands was
                      nonexistent or negligible until vehicular access by
                      road, causeway, or bridge was available.

                   Uniformly throughout the study communities no extensive
                development occurred until road, bridge, or causeway access
                was provided from the mainland. A corollary was that where
                no such access existed there was no extensive development,
                c.f., Cumberland Island and the Mississippi islands of the
                Gulf Islands National Seashore.

                   in each area, road access was perceived by local
                officials or developers as the first basic requirement for
                attracting development. And where roads, bridges or
                causeways were built, local officials and developers were
                invariably responsible for initiating the process. Thus,
                Dare County officials and private investors interested in
                developing the Dare County beaches initiated measures for
                bridges across Roanoke and Currituck Sounds in North
                Carolina. This in turn brought pressure on the State of
                North Carolina to fund and build Route 158 connecting the two
                bridges. The original causeway/bridge complex to St. Simons
                Island was funded by City of Brunswick revenue bonds (1924),
                and the first 22 miles of roads on St. Simons were
                constructed by the Sea Island Company and donated to Glynn
                County. At Pensacola Beach the first bridge was built in
                1931 with private funds to provide access solely to a casino;.
                the bridge that immediately preceded efforts to develop
                Pensacola Beach was funded in 1948 with Escambia County
                revenue bonds. Railroad access to Dauphin Island was

               24

               apparently attempted in 1866, but failed; through the
               combined efforts of the Mobile Area Chamber of Commerce,
               Mobile County, and the State of Alabama, the first bridge to
               Dauphin Island was completed in 1955. Finally, the first
               causeway to South Padre Island was financed by Cameron County
               bonds and completed in 1954.

                   In no instance were the barrier island communities as
               much as 5 percent developed when the first bridge, road, or
               causeway was built. In the principal study areas there had
               been no demand for exclusive developmentf inaccessible except
               to those with boats. The study areas did not include Jekyll
               Island, Georgia, where such demand did arise. A barrier
               island sandwiched between St. Simons Island on the north and
               Cumberland Island on the south, Jekyll became the most
               exclusive resort in the nation in the late 19th Century. It
               was selected by a team of health experts and developed
               privately as a winter resort offering complete privacy,
               beauty, and a fair climate. The Jekyll Island Club operated
               for about 56 years. The island was purchased by the State of
               Georgia in 1947, and operated as a resort area (accessible by
               causeway) by the Jekyll Island Authority.

                   Elsewhere all development on the barrier islands was
               dependent upon vehicular access. For those islands no
               extensive development would, or could, occur without
               vehicular access.

                      Convenient access per se did not lead immediately in
                      every case to extensive development in the adjacent
                      communities.

                   A chronology of vehicular access to the study communities
               is presented in Table 3. There were some instances where
               access was followed immediately by development, e.g., St.
               Simons Island, Sea Island, Pensacola Beach, and Dauphin
               Island. But at Nags Head and Kill Devil Hills, the Great
               Depression and World War II intervened before development
               began in earnest in the 1950s, some 20 years after access
               opened the area to potential development. Similarly, more
               than 15 years passed before the first substantial development
               began on South Padre Island.

                   In all of the study communities the early years of
               development were sluggish. At Pensacola Beach, leases were
               offered at $5.00 per year as an incentive to attract people
               to develop on the island. At that price, the Santa Rosa
               Island Authority was hard pressed to find takers. At Dauphin

                                                                          25

                 0)     Table 3. Chronology of Vehicular Access to Study Communitlest Funding Sources, and Periods of Principal Development.

                                                        First Bridge/                       First                             Bridge/Causeway                        Principal
                                                          Causeway       Funding            Paved      Funding                  Improvements         Funding       Development
                        Location                            Year         Source---          Roads      Source                       Repairs         Source            Per io.d

                        North Carolina
                              Roanoke Sound Bridge          1928        Dare County                                                 1950                NA     Nags Head/Kill
                                                                        Bonds IToll)                                                                           Devil Hills
                                                                                                                                                               1950-Present
                              Wright Memorial               1930        Privately                                                   1967           Federal/
                              Bridge (Currituck Sound)                  Financed (Toll)                                                            State

                              Route 1511 (Kitty Hawk)                        ---            1931       State of                 Route 158          Federal/
                              to Nags Head)                                                            North Carolina         Bypass - 1959        State

                              Bonner Bridge                 1964        Federal/                                                    1980           State
                              (Oregon Inlet)                            State

                        !i@_Or 9 'a
                              Brunswick-St. Simons          1924        City of Bruns-      1924       Private-Donated         1981 (Est.)         Federal/      St. Simons 1.
                              Causeway Bridge                           wick Bonds                     to Glynn County                             Local         1940-Present;
                                                                        (Toll)                                                                                   Sea island
                                                                                                                                                                 1926-Present

                        Florida
                              Oulf Breeze-Pensacola         1931        Private             1948       Escambla                     1948           Escambia      Pensacola
                              Beach Bridge Causeway                     (Casino)                       County                                      Co. Bonds     Beach
                                                                                                                                    1974           St. Rev.      1948-Present
                                                                                                                                                   Bonds

                        Alabama
                              Dauphin island Bridge         1955        Mobile County      1956-57     State of                     1960           Federal       Dauphin
                                                                        Bonds; State                   Alabama                                     (100%)        island
                                                                        (Toll)                                                                                   1956-Present

                        Texas
                              South Padre island -          1954        Cameron             1954       Cameron                      1974           Federal       South Padre
                              Queen Isabella Causeway                   County Bonds                   County                                      State         island -
                                                                        (Toll)                                                                                   1971-Present

                        Source: Sheaffer 1. Roland, Inc. - Case Studies.

              Island, the Mobile Area Chamber of Commerce generated great
              interest in the properties on the island and 2000 lots sold
              within three days of the initial offering. But fewer than
              200 houses had been built by the 1960s.

                  Then, for reasons not fully known, all of the study
              communities associated with resort development experienced a
              surge of interest and growth in the late 1960s and early
              1970s. The growth coincided with the early acquisitions of
              land for Cumberland Island and the Gulf Islands National
              Seashore, but was clearly unrelated to those events, and was
              at least regional if not national in scope. A growing
              awareness of the coast as a desirable place for recreation
              and development, greater levels of disposable income, and
              more leisure time than before, all appear to have been
              contributing factors. Whatever the causes, it was striking
              that all of the resort areas studied, so geographically
              dispersed, experienced active growth at roughly the same
              time. Although the active development also coincided with
              enactment of the National Flood Insurance Act, the study
              found that communities were growing before many of them
              entered the National Flood Insurance Program. This suggests
              that the availability of flood insurance was not a
              significant contributing factor at the outset.

                     Where no road access exists to the national seashore,
                     development in adjacent communities (whether on the
                     mainland or on adjacent barrier islands) has not been
                     measurably affected by federal acquisition of the
                     national seashore, c.f., Cumberland Island, Georgia,
                     and Gulf Islands (Mississippi islands).

                  Cumberland Island was unique in many respects. Until
              acquired for the Seashore, much of the island had been held
              in trust for descendants of Thomas Carnegie, brother of
              Andrew Carnegie. The island had been deliberately kept
              undeveloped and secluded, and any disposition of the island
              was with the desire that it be kept in that condition. Lack
              of bridge and causeway access effectively reinforced the
              beneficiaries' privacy. Its continued isolation as a
              national seashore has resulted in no discernible impact on
              development in nearby communities.

                  The Mississippi islands now comprising part of the Gulf
              Islands National Seashore are even farther from the mainland
              than Cumberland Island is. The lack of any bridge or
              causeway access was clearly a contributing factor to the
              nondevelopment of these remote islands. But a knowledge,

                                                                         27

                experience, respect, and fear of hurricanes may have been an
                even greater deterrent. Complete and violent inundation
                during Hurricane Camille in 1969, severe erosion and
                overwash, and virtually total destruction of all structures
                on the islands including a former coastal fort, set the stage
                for their inclusion in the Seashore little more than two
                years later.

                    The study team consulted the appraisers who appraised
                Cumberland Island and the Mississippi islands for the
                National Park Service, and who were intimately familiar with
                land values both on the islands and on the mainland. Both
                stated unequivocally that sale of the islands to the federal
                government had no measurable impact on the market on the
                mainland. Factors cited by Roy Gordon, MAI, of Savannah,
                regarding Cumberland Island included "remoteness,"
                "isolation," "inaccessibility," and the fact that it was
                "held in trust for the descendants of Thomas Carnegie." J.
                Ed Turner, MAI, of Mississippi, cited distance,
                inaccessibility except by boat, and the vigor of the
                economies in the adjacent mainland communities as factors.

                       Where road access exists to the adjacent community
                       independent of road access to the national seashore,
                       development and land values in the adjacent community
                       are not measurably affected by the Seashore
                       acquisition, c.f., Dauphin Island, South Padre Island.

                   Dauphin  Island was selected for case study in part
                because, as the next island east of the Mississippi islands
                of the Gulf Islands National Seashore, its development and
                land values are hypothetically affected by the federal
                acquisition. However, development on Dauphin antedates
                acquisition of the Seashore, and its dynamics are wholly
                independent of the Seashore. Distance from the islands is an
                apparent factor in that independence. Bridge access is
                acknowledged as the single most important element affecting
                potential development on Dauphin. A suit by the Sierra Club
                and the Natural Resources Defense Council unsuccessfully
                challenled proposed federal funding of the Dauphin Island
                bridge.   If the challenge had been successful, development
                on Dauphin would have been sharply curtailed and land values
                would have continued to be depressed. This impact would have
                been independent of any effect of federal acquisition of the
                Seashore.

                   Principal access to the Padre Island National Seashore is
                on the north end of the island. No paved road extends the
                length of the island and most Seashore activity is focused on

              28

               the north end. While South Padre Island lies immediately to
               the south of Padre Island, the two are separated by Mansfield
               Cut, a ship channel which is unbridged. The northern 29
               miles of South Padre Island are undeveloped and without paved
               roads as of 1980, and as effectively cut off from Padre
               Island as Dauphin is from the Gulf Islands.

                  As with Dauphin Island, development on South Padre Island
               is dependent on causeway access (Queen Isabella Causeway).
               Development in the 1960s was apparently slowed by local
               perception of the poor quality (high salinity) of potable
               water available in South Padre Island. Today, limited
               availability and cost of water rights are prime deterring
               factors to development of the north end of the island. These
               factors are overwhelmingly determinant, not federal
               acquisition of the Seashore.

                     In all instances studied initial development of road,
                     bridge, or causeway systems to adjacent communities
                     was financed by private, local, and state interests.
                     Federal participation in the costs of road, bridge, or
                     causeway access, came after private, local, and state
                     commitments and included:

                          - Improvements and expansion of existing systems
                          - Replacement of storm-damaged systems

                  Although the initial development of access was
               consistently initiated by local governments and developers,
               there has been substantial federal involvement in funding
               expansion and improvements of existing access. Examples
               include: Wright Memorial Bridge across Currituck Sound,
               Route 158 Bypass through Kill Devil Hills and Nags Head, and
               Queen Isabella Causeway to South Padre Island as well as the
               proposal to replace the storm-damaged bridge to Dauphin
               Island. In addition, the apparently forthcoming expansion of
               the Torras Causeway to St. Simons Island will use federal
               Bridge Restoration Funds.

                  The federal role is explicable historically both in terms
               of federal strategy and programs. In the cases of the outer
               Banks, St. Simons Island, and Sea Island, development began
               before major federal highway programs were authorized by the
               Congress. The Federal Aid Highway program is a post-World
               War II phenomenon. Secondly, federal policy requires state
               and local initiatives on secondary road systems such as those
               in the study communities. Hence, as a policy matter federal
               highway funding would not have been expected in the initial

                                                                          29

                development of the barrier islands.

                    Cost information on bridge, road, and causeway systems in
                the study communities was collected to the extent available
                from local, state, and federal officials. Those data are
                displayed in Table 4.

                    Recent bridge data show sharp increases that not only
                reflect inflated costs of construction in the 1970s and in
                1980, but also different causeway and bridge design. The
                first bridges across Roanoke Sound and Currituck Sound, and
                to Pensacola Beach, were wooden. The bridge to Dauphin
                island was reinforced concrete with a lift span at the
                Intracoastal Waterway. The causeways to St. Simons Island
                and to Sea Island are earth berm construction, with a lift
                span bridge across the Intracoastal Waterway.

                    Both state and federal standards now generally require
                coastal bridges and causeways to be elevated on piers to
                minimize adverse impacts on wetlands. moreover, in lieu of
                drawbridges, bridges crossing the Intracoastal Waterway are
                being elevated to permit vehicles to cross unimpeded by
                vessel traffic, and vice versa, and to reduce labor and-
                maintenance costs associated with lift bridges. The bridge
                at South Padre Island is elevated to an 85-foot minimum
                vertical clearance above mean sea level. The proposed
                Dauphin Island Bridge is also designed for 85-foot vertical
                clearance, rising from a 21-foot high prestressed concrete
                roadway elevated on piers.

                    Contemporary design standards result in significantly
                more costly bridges and causeways than were initially built
                by local and private interests. For instance, if the Dauphin
                Island Bridge is completed for the current contract amount,
                the cost will exceed $10 million per mile, or 10 times the
                costs per mile of the first bridge completed in 1955. Such
                costs imply that future bridge and causeway construction,
                built to current design standards, may require federal
                funding of a major share. This conclusion was supported
                explicitly by a developer and a realtor.

                    Dewey Benefield, Vice President of the Sea Island
                Company, stated that such costs "render economically
                infeasible development of any barrier island that does not
                already have a causeway." More than any other development
                group interviewed, the Sea Island Company has assumed
                privately the costs of roads, causeways, utilities, and urban
                infrastructure to develop St. Simons Island and Sea Island.
                However, Mr. Benefield stated that under today's conditions

               30

                                        Table 4. Costs of Access to Study Communities

                                                                              First Bridge/        First Paved         Bridge/Causeway                      Purpose
                                                                                Causeway              Roads              Expansion,                           of
                                        Location                              ..Cost IYear)        Cost (Year)            Repairs                            Work

                                        North Carolina
                                             Roanoke s6und Bridge                $140,000                NA                   NA                       New Bridge
                                                                                  (1928)

                                             Wright Memorial                          NA                 NA               $3,350,000                   New Bridge
                                             Bridge                                                                          (1967)

                                             Route 158                                                   NA                   NA                 improved access, highway
                                                                                                                                                 safety

                                             Bonner Bridge                      $4,151,000                                $4,000,000             Repairs; structural support
                                                                                 (1964)                                   (1980-1961)
                                        Geor ia                                                                                                  Expansion to four lanes and
                                             Brunswick-St. Simons                  NA                    NA                    NA                elevation proposed
                                             (Torras Causeway)

                                        Florida
                                             Gulf Breeze-                          NA                    NA               $5,000,000                   New Bridge
                                             Pensacola Beach                     (1931)                                       (1974)
                                                                                   NA
                                                                                 (1948)

                                        Alabama
                                             Dauphin island Bridge              $3,000,000           $900,000            $40,051,500                    New Bridge
                                                                                 (1955)               (1955)              (1980-81)

                                        Texas
                                             South Padre island                 $8,598,447               NA              $21,361,242                     New Bridge
                                                                              _LI@5 4 j                                      (1974)
                                        Total                                 $15,889,447                                $73,762,242

                                        Source; Sheaffer & Roland, Inc. - Case Studies.

                            FA

                no public or private corporations or individuals will fund
                causeways.

                    Smith Pickett, Jr., whose realty firm specializes in
                Dauphin Island properties, was asked whether Dauphin Island
                development could be financed and accomplished by private and
                local interests as it was 25 years ago, but at today's
                standards. He responded that the island could be developed
                without a bridge, but would have to cater to very exclusive
                development, with access by yacht or private airplane. He
                doubted that private and local interests would put in a
                bridge without federal help, and asserted that there is "no
                way to repeat what is there now" without a bridge, because of
                the cost.

                     Water Supply

                       In several adjacent communities that are on barrier
                       islands, increasing density of development has caused
                       them to rely on mainland sources for water.

                       Only two communities studied still obtain 100 percent
                       of their potable water from wells on the island,-and
                       these systems are being affected by salt water
                       intrusion and infiltration and inflow of polluted
                       water. Both communities have septic system or
                       building moratoria in effect to restrict new
                       development.

                    Although the original development of each of the case
                study areas relied upon on-site wells or cisterns for water
                supply, as development intensified there was a tendency to
                replace on-site water supply sources with mainland sources
                via transmission mains built along the islands' causeways and
                bridges. A corollary to this is that mainland source water
                supplies were not tapped until automobile access had been
                provided via bridges and causeways.

                    The need for off-island water supplies is based upon the
                limitations of the islands' aquifers and soils to supply '              I
                fresh water and to absorb septic wastes. Early developments
                on the islands, prior to automobile access, consisted of
                sparse and scattered residences, fishing shacks, small
                resorts and military installations. The low density nature
                of these developments enabled them to use shallow wells on
                the islands. In addition, there was enough undeveloped land
                to allow for wastewater disposal via individual septic
                systems without risk of water supply pollution. This

               32

               arrangement continued until the provision of access to the
               islands.

                   After construction of bridges and causeways for
               automobile access to the islands, development has increased
               to the point where both the water supply capacity and the
               waste assimilating capacity of the islands have been
               exceeded. Thus, it can be argued that the provision of
               access not only spurs island development but also virtually
               necessitates the eventual provision of off-island water
               supply.

                   On South Padre Island, the limited nature of the islands'
               fresh water sources resulted in the construction of a
               mainland water supply source when the first causeway was
               built to the island in 1952. In Dare County, North Carolina,
               automobile access preceded the building of an off-island
               water supply by more than 40 years, reflecting the rather
               slow development of Nags Head and Kill Devil Hills, and the
               relatively larger water supply capacity of the area.
               Nevertheless, by 1977, increased development demands for
               fresh water, coupled with local pollution of water supply
               sources, required construction of a regional water supply
               system using qff-island sources.

                   In the cases of Dauphin Island and St. Simons Island,
               water supply sources on the islands are still in use.
               However, these systems use relatively deep aquifers that are
               not as susceptible to surface pollution as other areas. In
               addition, the level of development on these islands is still
               fairly low. Nevertheless, there are already reported
               deficiencies in both existing water supplies related to salt
               water intrusion, declining water levels, and surface
               pollution. Both communities have sewer or septic system
               moratoria in effect until additional waste treatment capacity
               or water supply capacity can be obtained.

                       Availability of water from island or mainland sources
                       has not been a constraint on development in most of
                       the study areas. An exception is South Padre Island
                       where the availability and cost of additional water
                       rights are limiting further development.

                   In  each case study area, water supply was a critical
               requirement for development and was, consequently, provided
               to whatever degree necessary in the,course of each island's
               development. The Mobile Area Chamber of Commerce provided
               funds from the original sale of lots on Dauphin Island for

                                                                              33

               construction of a water supply system in 1955. This system
               had adequately served the island until 1979, when capacity
               problems and hurricane damages were encountered. The Dauphin
               Island Water & Sewerage Board has proposed system expansions
               to meet these deficiencies.

                   Similarly, the communities of Nags Head and Kill Devil
               Hills met their water supply needs after individual wells
               became inadequate before 1962. In 1962 the communities built
               a joint municipal system using both surface and groundwater
               sources. In 1977, Dare County constructed a regional water
               supply system which replaced the municipal supply sources, in
               response to further development pressures in the communities.

                   The South Padre Island water supply facilities were
               provided both by the island's developer and by a local water
               district in several stages. The island is currently served
               by a transmission main from the mainland which conveys water
               from the Lower Rio Grande. River water was obtained as a
               source through purchase of water rights. Current water
               rights have been judged adequate only for modest future
               growth. The cost of obtaining additional water rights is
               considered to be high enough to hinder further development.

                      Federal expenditures, in the form of low interest
                      loans, grants, and sale of excess property,
                      contributed to establishing or upgrading water supply
                      systems in some of the study areas. Community systems
                      in the Nags Head - Kill Devil Hills area and on St.
                      Simons Island benefited from federal loans and sale of
                      excess property, respectively. Expansions of existing
                      systems in South Padre Island and Nags Head - Kill
                      Devil Hills also received federal grants and loans. A
                      currently planned expansion of the facilities at
                      Dauphin Island awaits similar federal aid.

                   In the communities studied, federal government assistance
               has been significant in establishing and upgrading water
               supply systems. These effects are not due to any one federal
               program, however. The water supply system installed by the
               U.S. Navy on St. Simons Island in the 1940s was sold as
               excess property to the local county government in 1947 and
               served as the first municipal water supply system for
               development on the island. The same system is in use today,
               although state funds will be used for its expansion in the
               near future.

                   The communities of Nags Head, Kill Devil Hills, and South

               34

               Padre Island obtained federal assistance under two separate
               programs. The adjacent Outer Banks communities obtained a
               low-interest, long-term loan from the Farmers Home
               Administration (FmHA), under the Rural Communities Water &
               Waste Disposal Systems Program, to finance the communities'
               first water supply systems jointly. Fifteen years later Dare
               County took advantage of the same program to obtain both an
               FmHA grant and loan to finance a regional water supply
               system; the system was designed primarily to serve the same
               two communities.

                   South Padre Island was an unincorporated development when
               its first water supply system was constructed without federal
               aid in 1952. After the island was incorporated, a major
               expansion and upgrading of the water system was carried out
               in 1977, with partial funding by an Economic Development
               Administration grant.

                  Dauphin Island developed its first community water supply
               system with funds obtained through land sales on the island.
               To repair damages the system sustained during Hurricane
               Frederic in 1979, more than $250,000 in disaster relief funds
               from the Federal Emergency Management Agency were approved.
               Realtor Smith Pickett, Jr. noted that further development on
               the island wiil require either a mainland fresh water source,
               or desalination of water. The Dauphin Island Water &
               Sewerage Board has applied for Department of the Interior
               funding of a demonstration desalination plant to serve as an
               expansion to its existing water system.

                   The case studies show that the pattern of federal
               assistance to communities for water supply, while not
               representative of any single or coordinated program, is
               nevertheless significant for the number of programs through
               which funding assistance has been available. Cost
               information on water supply systems in the study communities
               is presented in Table 5. Of costs totaling $14.3 million,
               the federal share was $2.3 million.

                    Wastewater Management

                      In all communities studied, initial development relied
                      primarily on septic systems for disposal of
                      wastewater; as development increased, septic systems
                      tended to exceed the capacity of local soils to
                      assimilate the wastes.

                      In all study communities, the provision of a complete
                      sewerage system and wastewater treatment facilities

                                                                         35

                            Uj

                                       Table 5. Water Supply System Costs in the Study Communities.

                                                                                                                  Total Cost Attributable         Federal        Federal
                                       Location                                  Type of Facility                   to Study Communities          Share          Agency

                                       North Carolina                                                                                                                  I
                                           Kilf-Devil Hills -            Municipal water supply - ground          $ 4,073,500 - Guaranteed                        FmHA
                                           Nags [lead                      water                                                 Loan
                                                                         Regional water supply                    S 4,886,950 -  Guaranteed     $806,350-         FmHA
                                                                                                                                 Loan             Grant

                                       Geo[2ia                                                                          NA                           NA

                                       Alabama
                                           Dauphin Island - 1955         Wells, storage tank, distribution        $   625,000
                                                                           lines
                                                          - 1980         proposed expansion                       $ 1,178,000                        --                2
                                                          - 1980         Proposed desalination plant              $   849,000                    $849,000          Doi

                                       Texas
                                           South Padre Island - 1954     Water Main                               $   200,000                        --
                                                                - 1954   Water distribution lines, storage        $   300,000
                                                                           tank
                                           Fresh Water District   #1 -
                                             1955                        Acquisition of water system              $   100,000
                                             South Padre Island   -
                                               1966-1972                 Water main installation                  $   200,000                        --

                                           Fresh Water District   #2                                                                                                   3
                                             1973                        Water system expansion                     1,911,000                    $723,330          EDA
                                       Total                                                                      $14,323,450                  $2,378,680

                                       1   Farmers Home Administration, Department of Agriculture.
                                       2   Department of the interior.
                                       3   Economic Development Administration, Department of Commerce.

                                       Source: Sheaffer & Roland, Inc. - Case Studies.

                      has become a requisite for prevention of environmental
                      degradation and for continued development on the
                      islands. Septic system moratoria were in effect in
                      Kill Devil Hills, Dauphin Island, and St. Simons
                      Island when the case studies were conducted.

                   Early development in the study communities was of very
               low density and the vast majority of the individual homes,
               businesses, and resorts used septic systems to treat
               wastewater. Under the circumstances, septic systems were the
               least expensive and most trouble-free method of wastewater
               treatment available. Small package plants with limited sewer
               systems provided service to a small number of homes on
               Dauphin Island, a county park facility on South Padre Island,
               and some of the early residences on St. Simons Island.

                   As communities became more easily accessible, an
               increasing number of lots were developed, and seasonal
               population increased. The rather low waste assimilating
               capacity of the sandy island soils was eventually exceeded in
               all of the study communities. occurrences of surface flows
               of untreated wastes, groundwater pollution from septic
               wastes, and migration of wastes into prime coastal waterways
               became more frequent.

                   Eventually each of the study communities began to install
               sewer systems. Several of the larger hotels on South Padre
               Island installed private "package" wastewater treatment
               plants. In 1977, a complete sewer system and wastewater
               treatment plant to serve the entire town was installed with
               the help of Environmental Protection Agency's Wastewater
               Treatment Facilities Construction Grant funds.

                   On the Outer Banks, only private package plants serving
               small subdivisions or motels are currently in use other than
               septic systems. Consequently, septic system effluents have
               been polluting Roanoke Sound. A septic system moratorium is
               in effect in portions of Kill Devil Hills while a regional
               sewerage plan to serve both Kill Devil Hills and Nags Head is
               reviewed for approval and funding by the Environmental
               Protection Agency.

                   At St. Simons, a.small wastewater treatment plant was
               installed to serve the Naval Air Base on the island, and also
               served a small portion of the community outside the base.
               Following World War II the base was closed, and the treatment
               plant was declared excess and sold to Glynn County in 1947.
               St. Simons Island has expanded this sewer system to serve

                                                                          37

               most of its development. However, the present system has
               operational difficulties and an upgrading of both the sewer
               system and the treatment plant is under way with
               Environmental Protection Agency funding anticipated.

                   Dauphin Island, currently served primarily by septic
               systems, is under a septic system moratorium due to septic
               pollution of the waters of Mississippi Sound. In late 1980,
               the Water & Sewerage Board had pending Environmental
               Protection Agency funding of a major expansion of its
               sewerage system. The federal share would be $3.5 million; a
               balance of $5.6 million is expected to be paid by assessing
               each lot on the island.

                      In only one of the study communities were federal
                      monies for wastewater management systems expended as
                      part of the initial costs of development of the
                      islands. The original wastewater treatment plant and
                      sewer system on St. Simons Island was built by the
                      U.S. Navy and sold as excess property to Glynn County
                      in 1947.

                   Much of the development in the study communities
               antedated federal water pollution control programs. Also,
               characteristic development patterns for barrier islands made
               them ineligible for federal assistance in the initial costs
               for wastewater management. Federal monies for sewers and
               wastewater treatment facilities are available for meeting the
               20-year needs of existing communities (EPA Facilities
               Construction Grants), for providing initial facilities to
               existing incorporated rural communities (Farmers Home
               Administration) or urban communities (Department of Housing &
               Urban Development), and for providing new or expanded
               facilities in areas of pressing economic need (Economic
               Development Administration). Thus, federal programs are
               structured to aid only existing communities.

                   In contrast, development of barrier islands typically
               began as private residential or resort areas, physically
               isolated from nearby communities. These developments are
               therefore not viewed as expansions or annexations of existing
               developed areas and are not generally eligible for federal
               wastewater funds. Once established, however, barrier island
               developments soon grow to the point where increased
               densities, the need for a centralized sewerage system, and
               political incorporation tend to occur concurrently. Federal
               assistance to these communities tends to follow soon
               thereafter.

               38

                      Federal funds spent so far in connection with
                      wastewater management in the study communities are:
                      201 planning funds for wastewater treatment facilities
                      and one construction grant (at South Padre Island).
                      The federal contribution is estimated to be $3.3
                      million.

                      Two of the study areas are currently seeking federal
                      construction grants for new or expanded wastewater
                      treatment facilities:

                           - Dauphin Island, Alabama       $3.5 million
                           - Dare County, North Carolina   $7.5 million

                   Although some degree of coastal surface water and
               groundwater pollution (attributable to failed septic systems)
               occurred in some of the study areas before the 1970s, none of
               the communities perceived that they had a pollution problem
               which required immediate action. Development of water
               quality standards and enforcement measures under Federal
               Water Pollution Control Act Amendments of 1972, and planning
               efforts under the Coastal Zone Management Act, resulted in
               recognition of pollution problems by state and federal
               agencies. Subsequent pressure and incentives induced
               communities to address these problems.

                   In 1975 South Padre Island began to plan for installation
               of sewers and treatment facilities. By 1978 the remainder of
               the study communities were actively involved in the
               wastewater facilities planning process. Thus, all of the
               current wastewater planning and construction activities in
               the study areas have occurred while the Environmental
               Protection Agency's Wastewater Facilities Planning and
               Construction Grant programs have been in effect.

                -  Most of the study community leaders did not object to
               federal and state pressures to upgrade wastewater treatment.
               However, some community leaders objected to federal emphasis
               on centralized sewer systems and an insensitivity to the
               relationship between such systems and local growth. In
               communities attempting to control development, control over
               water supply and wastewater management are powerful tools for
               local officials to use in directing the course of
               development. Installation of centralized wastewater
               treatment facilities removes one of the potential controls,
               and was cited in at least one community as a negative factor
               inducing unwanted growth.

                                                                          39

                      Costs of wastewater facilities built or planned in the
                  study communities, with estimated levels of federal
                  participation, are shown in Table 6. The federal share
                  represents almost half of the total costs of $29.5 million.

                       Disaster Assistance

                          Federal disaster assistance funds of at least $43
                          million will be expended in two of the study
                          communities as a result of Hurricanes Frederic and
                          Allen. Major disasters had been declared in the
                          remaining states studied between 1953 and 1964, but
                          none were declared in those states from 1965-1980.

                      Federal disaster assistance programs surveyed in the
                  course of the study provide a limited measure of federal
                  involvement in this area. All Presidential declarations         of
                  major disasters were reviewed from May 1953 (the inception of
                  the federal disaster assistance program) to present. Data on
                  the Presidential declarations were divided into two periods:
                  (1) from May 1953 to December 1964 the disaster funding list
                  reported by state as the smallest political unit; and (2)
                  from December 1964 to present, the data are reported and
                  available by state, county, local community, and funding
                  category.

                      During the period May 1953 - December 1964, there were
                  five disaster declarations involving coastal storms in study
                  communities in North Carolina and Georgia. These included
                  four hurricanes and one major storm in North Carolina, and
                  one hurricane in Georgia. Federal disaster assistance
                  payments to the state and communities totalled $9,690,946 in
                  North Carolina and $1,309,782 in Georgia:

                                                  Presidential
                                Declaration           Fund          Type
                                   Date           Expenditures     Storms

                  North        Oct. 17, 1954        $1,290,939   Hurricane
                  Carofina     Aug. 13, 1955        $5,254,396   Hurricanes
                               Oct. 1,     1958     $ 846,588    Hurricane
                               Sept 12,    1960     $1,2090,420  Hurricane Donna
                               Mar. 16,    1962     $1,089,604   Noetheastern
                                                                 (Ash Wednesday
                               Total                $9,690,946        Storm)

                  Georgia      Sept.10, 1964        $1,309,782   Hurricane   Dora

                 4Q

                                   Table 6.   Costs of Wastewater pacilities in Study Colmaunities

                                                                                                                Total Cost Attributable
                                   Location                        Type of Facilit                              To Study Communities           F@deraj Share      eaderal A,3pnc

                                   North Carolina
                                   Ocean Acres Subdivision,        Small sewer system and package                                              NA                 NA
                                      Kill Devil Hills             plant for subdivision
                                   Dare County                     Regional sewerage and treatment              $10,198,150                      5,116,000        EPA
                                                                   system to serve both Kill Devil
                                                                   Hills and Nags Head

                                   gto r I Lia
                                   St. Simons Island               U.S. Naval facilities                                                       100%               U.S. Navy

                                   St. Simons Island               package plant addition                       $    845,000                   0                  NA
                                   St. Simons island               Sewer system and treatment plant             $ 4,535,000                      1,200,000        EPA
                                                                   expansions

                                   Alabama
                                   Dauphin Island                  Small sewer system and package                                              NA                 NA
                                                                   plant
                                   Dauphin island                  Repairs to existing system                   $    250,000                   $    250,000       FEMIN
                                   Dauphin island                  Sewer system and treatment plant             $ 9,242,918                    $ 3,512,000        EPA
                                                                   expansions

                                   Texas

                                   South Padre island              Small sewer system and package plant         --                             NA                 NA
                                   Cameron County                  Regional sewer system and treatment          $ 4,400,000                    $ 3,300,000        EPA
                                                                   plants

                                   Totals                                                                       $29,571,068                    $13,978,000

                                   Source;   Sheaffer & Roland, Inc. - Case Sttxlies

                    Note that the damages in North Carolina were incurred
                before the major development of the Outer Banks. Storms of
                those magnitudes today would cause significantly greater
                damage.

                    After December 1964 the survey revealed no major flood
                disasters in Dare County, North Carolina or in Glynn and
                Camden Counties, Georgia. This reflects a remarkably
                quiescent 16-year period in major storm activity in this
                area. Major disasters have been declared in the two Gulf of
                Mexico study areas during that same period, associated with
                Hurricanes Camille (August 1969), Frederic (September 1979),
                and Allen (August 1980).

                    Information on these three hurricanes was available from
                the Corps of Engineers for Hurricane Camille, and the Federal
                Emergency Management Agency for Hurricanes Frederic and
                Allen. The study team was unable to obtain physical disaster
                loan data from the Small Business Administration, nor data
                from other agencies which may have expended funds following
                Hurricane Allen. As a result, the materials available only
                partially reflect the total federal expenditures for these
                storms in the study areas.

                    In the aftermath of Hurricane Camille (one of the most
                severe storm ever to strike the continental United States),
                major disasters were declared covering counties in Louisiana,
                Mississippi, and Alabama. Although Mississippi bore the
                principal damage, at Dauphin Island the storm barely
                qualified as a hurricane. Nevertheless, gusts of minimal
                hurricane force (75 mph) and tides of 5 - 9 feet caused light
                to moderate damage. The After-Action Reports of the Corps of
                Engineers estimate that nearly 2,800 acres of the island were
                flooded. Available reports tended to estimate dollar
                damages, and only a few reported federal dollars expended.
                The Corps reported that nearly $21,000,000 was spent for
                debris removal in all counties, including $48,800 spent for
                all of Mobile County. The Corps also reported a cost of
                $21,200 to clear obstructions and remove shoals in Dauphin
                I'sland Bay. While the data available are not specific to
                Dauphin Island, the study team concluded that less than
                $100,000 in federal funds was expended on Dauphin following
                Hurricane Camille.

                    Hurricane Frederic passed over the west end of Dauphin
                Island near midnight, September 12 - 13, 1979, inflicting
                severe flooding and wind damages on the island. There was

               42

               severe destruction and damages were experienced as far east
               as Gulf Shores, Alabama, and light-to-moderate flooding and
               damages in Pensacola Beach.

                   Federal reimbursements identifiably applicable to Dauphin
               Island from the Federal Emergency Management Agency totaled
               $1,182,427. These included expenditures for debris
               clearance, protective measures, water control facilities
               (e.g., seawalls), public buildings, public utilities, and
               miscellaneous utilities and services. They are detailed in
               Table 7.

                   Expenditures on Dauphin Island for sand removal, repairs
               to county roads, and resurfacing of local streets were
               included in overall Mobile County applications for debris
               removal and road systems. The county engineer of Mobile
               County provided estimates of these costs allocable to Dauphin
               Island:

                            Sand removal                   $ 719,000
                            County road repairs            $ 842,450
                            Resurfacing local street       $ 210,800

                            Total                          $1,772,250

                   An additional $51,500 was expended for repairs to the
               airport on Dauphin Island, reimbursed from Federal Emergency
               Management Agency funds.

                   The overwhelming public expense on Dauphin is the cost of
               the storm-damaged Dauphin Island bridge and causeway. These
               costs, 100 percent of which are being funded by the Federal
               Highway Administration, are estimated to be:

                   Demolition and removal of bridge        $ 5,000,000
                   Construction of new bridge              $33,000,000
                   Temporary ferry service                 $ 2,000,000

                   Total estimated cost                    $40,000,000

                   Hurricane Allen, the first hurricane of the 1980 season,
               struck the Texas coast on Padre Island, north of South Padre
               Island. That landfall placed South Padre Island on the left
               side of the storm, fortunately reducing the damages that they
               most assuredly would have experienced if the storm had struck
               south of the city. Nevertheless, the city applied for nearly
               $400,000 in disaster relief funds, three-quarters of which
               was reimbursed by the Federal Emergency Management Agency,

                                                                              43

                              Table 7.   Federal Funds for Disaster Response and Recovery, Bridge Construction, and Airport Repairs
                                         Hurricanes Camille, Frederic, and A)I'en.

                                                                   Hurricane Camille                 Iturricanes Frederic and Allen
                                                                   FundTn-gMobile            Funding    Dauphin    Mobile County, South Padre
                              Purpose of Expenditure               Agenc      @ount          Agency     Island     (Daup htn S.     Island
                              Bridge Demolition and Clearance      COE2            0         FHwA3     $ 5,000,000              0             0
                              Bridge Construction                  COE             0         FHwA       33,000,000              0             0
                              Airport Repairs                      COE             0         FEMA4           51,500             0             0
                              Ferry System                         COE             a         FHWA         2,000,000             0             0
                              Debris Clearance                     COE    $ 48,000           PEMA                315  $ 719,000         48,287
                              Protective Measures                  COE             0         FEMA            75,3885
                              Road Systems                         COE                                                          0       37,683
                                                                               NA            FEMA                  0    1,053,250       244,254
                              Water Control Facilities             COE             0         FEMA           18'  000            0       59,562
                              Public Buildings                     COE         5,000         FEMA           57 438 5
                              Public Utilities                     COE         4,900         FEMA           544:0946            0        4,565
                              other                                                                                             0             0
                                                                   COE        21,200         FEMA           487r282             0        1,459
                              Subtotal Application                 COE             -         FEMA       $1,182,427     $1,172,250       395,815
                              Total Approved                       COE      $100,000                    $41,233,927    $1,172,250      $296,861 (75%)
                              IPortion of disaster funds approved for Mobile County and allocable to Dauphin Island, according         to
                               County Engineer, Mobile County.
                              2Corps of Engineers, Department of the Army.
                              3Federal Highway Administration, Department of Transportation.
                              4Federal Emergency Management Agency, Federal Insurance Administration.
                              5includes protective measures for damages sustained by Marine Environmental Science Consortium.
                              6Damage to water and sewer systems.

                              Source. Data for Hurricane Camille from Corps of Engineersj data for Hurricanes Frederic and Allen from
                                       Federal Emergency Management Agency, Office of Disaster Response and Recovery; other agencies,
                                        such as the Small Business Administration, may have expended funds after Hurricane Allen, but
                                        these data were not available.

               under the newly instituted cost-sharing policy of the Agency.
               Distribution of the costs is displayed in Table 7.

                   Flood Insurance

                      Flood insurance coverage in the study communities
                      currently exceed $578 million. Claims totalling $17.8
                      million were paid in the study communities in the
                      period January 1978 to November 1980. Sharp increases
                      in the total number of policies and total flood
                      insurance coverage were noted following Hurricanes
                      Frederic and Allen.

                   Flood insurance is perceived in most of the study
               communities as a positive force in obtaining financing where
               it is needed. Only at Sea Island was flood insurance
               perceived as insignificant in financing, largely because of
               the wealth of most individual property owners.

                   Five of nine communities or counties studied are in the
               regular program of the National Flood Insurance program. In
               these five communities, new construction appeared to comply
               with the Program's first floor elevation requirements for a
               100-year storm surge level.

                   The study communities' status in the National Flood
               Insurance Program, including total number of policies and
              .total amount of insurance is depicted in Table 8. As of
               November 1, 1980, 11,812 flood insurance policies (under the
               regular program or the emergency program) were in force in
               the nine communities and counties. Coverage totaled $578.56
               million. The average policy amount is $48,981 for the nine
               communities.

                   Claims payment data for the years 1978 - November 1980
               are also depicted in Table 8. In that roughly three-year
               period more than 1,800 claims were paid in the total amount
               of $17.81 million, for an average claim of $9,850.
               Approximately 98 percent of those claims related to damages
               incurred in Hurricanes Frederic (1979) and Allen (1980).
               When all other claims payments are removed from the data, the
               average claim payment was $10,075; all other claims averaged
               just one-half of that, or $5,023.

                   Data presented in Table 9 compare communities in the
               regular and emergency programs with national experience in
               the National Flood Insurance Program between January 1978 and
               April 1980. Although strictly coastal data could not be

                                                                          45

                                        Table 8. Flood insurance in Force and Claims Paid in Study Communities (As of Nov. 1, 1980).

                                                                         Program      Number of            Amount of            Year of           Claims             Amount                Average
                                        Community                        Status       Policies             Insurance               Flood            Paid              Pa id                 Claim

                                        Dare County, NC                      R          2,252              $107,475,700            1978                 9         $        13,053          $ 561
                                                                                                                                   1979                 1                     502             502
                                                                                                                                   1980               15                  71,259            4,751
                                        Kill Devil Hills, NC                 R          1,214               67,486,100             1978                 7                  2,760              394
                                                                                                                                   1979                 0                       a                  0
                                                                                                                                   1980               11                  39,529            3,594
                                        Nags Head, NC                        R          1,298               79,804,700             1978                 0                       0                  0
                                                                                                                                   1979                 a                       0                  0
                                                                                                                                   1900               15                271,336'           18,009
                                        St. Marys, GA                        E               57                1,856,400           1978                 0                       0                  0
                                                                                                                                   1979                 0                       0                  0
                                                                                                                                   1980                 0                       0                  0
                                        Camden County, GA                    E               31                1,005,500           1978                 0                       0                  0
                                        (1/31/80)                                                                                  1979                 0                       0                  0
                                                                                                                                   1980                 0                       0                  0

                                        Glynn County, GA                     E          2,018               83,303,800             1978                 0                       0                  0
                                                                                                                                   1979                 0                       0                  a
                                                                                                                                   1980                 0                       0
                                        Pensacola Beach, FL                  R          1,419               92,818,700             1978                 1                  1,146            1,146
                                                                                                                                   1979               550             3,862,328             7,022  2
                                                                                                                                   1900                 1                  1,471            1,471
                                        Mobile County, AL                    R          2,441               97,706,800             1978                 5                  3,849              770  2
                                                                                                                                   1979               861            10,763,938            12,502
                                                                                                                                   1960               42                 342,980            8,166
                                        South Padre Island, TX               E          1,082               47,107,400             1978                 5                  3,031              606
                                                                                                                                   1979                 1                     ago             880
                                                                                                                                   1980              283              2,440,543             8,624.
                                        Total                                           11,812             $578,565,100                            1,007           $17,810,605             $9,850

                                        1
                                           National Flood insurance Program Status:             E    Emergency Programl R        Regular Program
                                        2  Payments related to Hurricane Frederic: Pensacola Beach, 538 payments totaling $3,849,644.
                                        3  Payments related to Hurricane Allen: Mobile County, 636 payments totaling $10,718,059.

                                        Source: Federal Emergency Management Agency, Federal insurance Administration, Washington, D.C.

                                     Table 9.   Comparison of National Flood insurance experience with Experience in Study Communities aetween 1978 and April
                                                1980.

                                                                                   National Flood insurance Experiencel                      Experience in Study committee  2
                                                                                             (1/l/78 - 4/23/80)                                   11@1/78  - 3Z31/80)
                                                                                                                                                  Regular          Emergency
                                                                                                                       Emergency
                                                                     Zones Al-A30, I V  4          V Zones             Program                    Program          Program

                                     Number of policies                          578,645              56,401             661,914                     7,577             2,700
                                     Total insurance in Force           $26,945,323,000      $3,557,353,900     $19,862,867,000               $335,967,200       $99,400,000
                                     Average Policy in Force                     $46,550            $63,072              $30,000                  $44,340            $36,015
                                                                                  24,967               2,199              55,973                     1,518                  6
                                     Total Paid Claims                                                             $273,247,253                $ls,366,151            $3,911
                                     Total Claims Payment                   $184,959,850        $23,526,261                                       $10,123                $652
                                     Average Claim Payments                       $7,408            $10,690               $4,882

                                     1   Columns headed *Zones Al-30, v- and 'Emergency" contain both coastal data (an estimated 10 percent) and riverine data
                                         (about 90 percent).   Strictly coastal data could not be separated.     The only purely coastal data under "National
                                         Experience" are "V Zones.*
                                     2   The "Regular Program" data under "Experience in Study Communities" include both 'A Zone" and "V Zone* data which could not
                                         be separated.
                                     3   .Zones A)-A30" are areas of special flood hazards with base flood elevations determined. Zones assigned according to flood
                                         hazard factors.
                                     4   .V Zones" are coastal high hazard areas with high wind velocity that are inundated by tidal floods. Zones assigned
                                         according to flood hazard factors.
                                     5   Study community emergency data do not include Hurricane Allen data; Allen occurred in August 1980, after the time period of
                                         this comparison.  Statistics with Hurricane Allen coverage included are:       Total Claims paid, 289; Total Claims Payment,
                                         $2,444,454; Average Claim Payment, $0,458.

                                     Source: Data for national experience from Federal Emergency Management Agency, Federal Insurance Administration, "Loss
                                              Expense Experience, January 1, 1978 - April 23, 1980, Exhibit 11, Sheet I." Data for study communities from Federal
                                              Emergency Management Agency, National Flood insurance Program. Compiled by Sheaffer & Roland, Inc.

                separated (see note to table), average Policy In Force data
                strongly suggest that buildings in the regular program
                communities were underinsured when compared to the national
                experience in V Zone areas (coastal high hazard areas with
                high wind velocity, vulnerable to inundation by tidal
                floods). The average claim payments in the regular program
                communities were also comparable to national V Zone
                experience. Thus, although the study communities contain
                both V Zone areas and areas of less hazardous flood
                conditions (A Zone areas), their damage experience approaches
                the purely V Zone experience on a national level. In view of
                the long history of coastal storms in the study communities
                in the regular program, one would anticipate that flood
                insurance coverage would be higher than it is. In South
                Padre Island, the data on the average policy in force in the
                emergency program reflect an unusually high number of
                condominiums and commercial structures (486) in comparison to
                single family dwellings insured.

                   The regular program communities (Kill Devil Hills, Nags
                Head, Dare County, Pensacola Beach, and Mobile County) had
                average claims payments experience slightly less than the
                national average for V Zones. They included claims for
                damage from Hurricane Frederic in Mobile county ($12,502
                average claim) and Pensacola Beach ($7,022 average claim) and
                damage from a northeaster that struck the North Carolina
                coast in the winter of 1980, destroying three homes in Nags
                Head and resulting in average claims of $18,089 in that
                community.

                   The inclusive date of Table 9 stopped four months before
                Allen occurred. Average claims experience with Allen
                included in the emergency program data is $8,458, nearly 75
                percent greater than the national emergency program
                experience.

                   Sharp increases in the number of policies in force and
                total flood insurance coverage were noted in the study
                communities that had experienced major storms. Flood
                insurance data immediately preceding Hurricanes Frederic and
                Allen were collected for Mobile County, Pensacola Beach, and
                South Padre Island, and are compared to the November 1, 1980
                flood insurance data in Table 10.

                   Combining the three communities, the number of policies
                increased 34 percent and policy coverage increased 56 percent
                after the storms. The largest gains were in Mobile County,
                where Hurricane Frederic amply demonstrated the need for more
                widespread coverage; the number of policies increased by 57

               48

                                           Table 10. Comparison of Pre- and Post-Hurricane Flood Insurance Coverage (Mobile County, AL; Pensacola Beach,
                                                        FL; and South Padre island, TX).

                                                                        Pre- torm Coverage                        Post-Storm Coverage                 Percent Increase
                                                                             NumE-erof Amouni-Of           As of       Number of     Amount of       Number of Amount of
                                           LocatJon               Date        Policies Coverage            Date        Policies      Coverage        Policies Coverage

                                           mobile County          8/31/79       1,553      $59,294,800     11/1/80     2,441     $   97,706,800          57%         65%

                                           Pensacola Beach        8/31/79       1,221       57,530,700     11/1/60     1,419         92,818,700          16%         61%

                                           South Padre Island     7/31/80    - 906          35,096,200     1.1/1/80    1,082         47,104,400          19%         34%

                                           Total                                3,680    $151,921,700                  4,942       $237,629,900          34%         56%

                                           Source; Federal Emergency Management Agency, Federal insurance Administration. Compiled by Sheaffer
                                                      Roland, Inc.

               percent (888 new policies), but the average policy amount
               increased only $1,875, or less than 5 percent, in Mobile
               County. The Pensacola Beach and South Padre Island data
               indicate nearly total penetration of the market in number of
               policies, but structures are distinctly underinsured. Of the
               three communities, Pensacola Beach registered the highest
               increases in average policy amounts, with policies increasing
               nearly $18,300 or 38 percent. Average policy amounts for the
               three communities combined increased 16 percent from $41,283
               to $48,084.

              50

                              IMPLICATIONS FOR FEDERAL POLICY

                   The insights gleaned from this study have a number of
               implications for federal policies toward development or
               protection of barrier islands. For comparison purposes, it
               is helpful to juxtapose a "protection" policy against a
               "development" policy. The study offered insights into the
               costs of a federal development policy in three of the study
               areas, corroborating at least in these instances estimates
               previously made of the costs of current federal programs
               projected to development of the remaining undeveloped,
               unprotected barrier islands.

                   Development Policy

                   Current federal programs can be characterized as part of
               a federal development policy. They support development,
               effectively leveraging private development money by shifting
               to the public sector portions of the costs of bridges, roads,
               causeways, water supply systems, wastewater treatment
               systems, shore protection, disaster relief, and flood
               insurance. The dimensions of that support are suggested in
               three of the study areas where federal expenditures were
               documented: Nags Head and Kill Devil Hills, Dauphin Island,
               and South Padre Island. When federal expenditures are
               distributed according to developed acreage in the study
               communities, the federal expenditures represent an average
               subsidy of $25,570 per acre in actual dollars expended over a
               number of years. (See Table 11.) When restated in terms of
               1980 replacement costs, the federal subsidy in the three
               study areas amounts to $53,250 per developed acre.

                   The sample area from which the federal expenditures have
               been drawn may or may not be representative of coastal
               communities similarly situated. However, the figures are
               consistent with estimates prepared by Sheaffer, Miller, and
               Rozaklis in their 1980 testimony before the House of
               Representatives and8the U.S. Senate on then pending barrier
               island legislation.   The subsidy estimates also are
               consistent with Miller's subsequent modifications to reflect
               the reduction in undeveloped, unprotected barrier island
               acreage in the National Park Service's August 1980
               inventory.9

                   Table 12 shows estimates of the potential costs of
               developing remaining barrier islands, based on the present
               worth of current federal programs. It uses the National Park

                                                                           51

          Ln          Table 11: Federal Expenditures in Three Study Areas (Nags Head and Kill Devil Hills, NC;
                                 Dauphin Island, AL; and South Padre Island, TX) in Relation to Developed Acreage

                      Purpose of Federal Expenditures                          Amount of Expenditures

                      Bridge/causeway expansion, repairs                             $33,710,742
                      Water supply systems                                             2,378,680
                      Waste water Management                                         13 978 000 1
                      Disaster response & recovery                                    43:403:0382
                      Flood insurance subsidy                                          3,2830736

                      Total Federal Expenditures                                     $96,754,196
                         Total developed acreage                                            3,7843

                         Average federal expenditure per developed acre                  $25,570

                      1Includes $40,051,500 attributable to Dauphin Island Bridge/Causeway.
                      2The flood insurance claims totaled $17,810,605 in the study communities. Federal subsidy is
                      based on an average subsidy of $278 per policy experienced nationwide during the period 1978
                      1980, times 11,812 policies in force in the study community.
                      3Study community developed acreage:
                               Nags Read, NC                         1,095
                               Kill Devil Hills, NC                    900
                               Dauphin Island, AL                       289
                               South Padre Island, TX                1,500

                               Total developed acreage               3,784

                      Source: Compiled by Sheaffer and Roland, Inc. using expenditure data from-Tables 4 through       9.

                                          Table 12. Estimated Potential Costs of Developing Barrier islands in April 1980 Inventory,
                                                       Based on Present worth of Current Federal Programs.

                                                                                      L w Development Case   1_               High Development Case   2
                                                                                -9stimated                               Estimated
                                                                                 Federal Costs      Percent of          Federal Costs      Percent Of
                                          Federal Assistance Programs               Billion)        Federal-Costs          Billion)        Federal Costs

                                          Sewers and Wastewater treatment            $1.20             29                     $3.61               32
                                          water supply                                .68              16                     2.00                18
                                          Roads, bridges, causeways                   1.11             27                     2.77                25
                                          Disaster relief                             .42              10                     1.31                12
                                          Flood insurance                             .25                6                      .79                7
                                          Shore protection, maintenance,
                                            flood control                             .47              11                     0.72              -  6

                                          Total                                      $4.13             100                  $11.20                100

                                           Assumes development related to the 160,000 acres of undeveloped uplands in the National Park
                                           Service's April 1980 Inventory of Undeveloped, Unprotected Barrier Islands.
                                          2Assumes development related to all undeveloped acreage (about 480,000 acres of uplands, wetlands,
                                          and interior waters) in the April 1980 Inventory.

                                          Source;   High estimates -- "Barrier islands Purchase: A Cost-Effective Approach to Management."
                                                    Testimony of John R. Sheaffer and Louis Rozaklis before the House Committee on Interior and
                                                    Insular Affairs, Subcommittee on National Parks and Insular Affairs, on HR 5981, March 27,
                                                    1980.

                                                    Low estimates -- Statement of John R. Sheaffer, H. Crane Miller, and Louis Rozaklis,
                                                    Sheaffer & Roland, Inc., before the Committee on Energy and Natural Resources, United States
                                                    Senate, concerning S. 2686, June 12, 1980.
                             Ln
                             W

                 Service's April 1980 inventory, showing 480,000 acres of
                 undeveloped, unprotected barrier units, consisting of
                 uplands, wetlands, and interior waters. The estimates assume
                 the development of the upland portions of the island and the
                 dredging and filling of as much as 60,000 acres of wetlands
                 for development purposes. The low estimates assume
                 development of 160,000 acres of uplands only, and omit
                 wetlands and interior waters from the calculations.

                     Since the analyses for Table 12 were prepared, the
                 National Park Service revised its April 1980 inventory of
                 barrier islands. The August 1980 inventory removed nearly
                 200,000 acres (almost 43 percent) from the undeveloped,
                 unprotected category. Approximately 108,000 acres in Texas
                 and 39,000 acres in Louisiana formerly included in the
                 category did not fully fit the definition of a barrier
                 structure. Another estimated 45,000 acres were found to be
                 in a protected status, and about 4,300 acres were
                 reclassified as being developed land.

                     Table 13 shows Miller's adjusted estimates reflecting the
                 reduction in unprotected, undeveloped acreage. The estimated
                 cost to the federal government of funding barrier island
                 development under current programs could range from $2.46 to
                 $6.05 billion over the next 20 years.

                     Protection Policy

                     A fairly wide range of "protection" strategies, of
                 varying cost and effectiveness, are available to the federal
                 government. Under a protection policy, it would be necessary
                 to distinguish between two distinct status quo conditions:

                          1. "Noncontiguous" barrier islands that are totally
                             or almost wholly undeveloped, that are not
                             immediately adjacent to developed areas, and that
                             are accessible principally by boat (an estimated
                             138,100 acres);

                          2. "Contiguous units" -- undeveloped barrier units
                             immediately adjacent to totally or partially
                             developed areas, and generally accessible by
                             roads, bridges, or causeways (an estimated
                             138,000 acres).

                 Another 885,000 acres are currently in the public domain and
                 are considered "protected" from development, and an estimated
                 280,000 acres are totally or partially developed. The
                 acreage in the public domain are excluded from these policy

                 54

                                              Table 13. Estimated Potential Costs of Developing Barrier islands in August 1980 Inventory,l
                                                         Based on Present Worth of Current Federal Programs.

                                                                                        Low Development Case  2               High Development Case  3
                                                                                  Estimated                               Estimated
                                                                                  Federal Costs      Percent of          Federal Costs      Percent of
                                              Federal Assistance Programs             Billion)       Federal Costs          Billion)        Federal Costs

                                              Sewers and wastewater treatment         .70               29                    2.03               34
                                              Water supply                            .40               16                    1.13               19
                                              Roads, bridges, causeways               .86               35                    1.50               25
                                              Disaster relief                         .25               10                      .73              12
                                              Flood insurance                         .15                 6                     .45                7
                                              Shore protection, maintenance,
                                               flood control                          .10                 4                     .21                3

                                              Total                                 $2.46               100                   $6.05              100

                                              IAugust 1980 National Park Service Inventory of Undeveloped, Unprotected       Barrier Islands;   in this
                                              revision of the April 1980 Inventory, total acreage classified as undeveloped and unprotected was
                                              reduced by about 200,000 acres. (See text.)
                                              2Assumes development related to the remaining 90,000 acres of undeveloped uplands in the August 1980
                                              Inventory.
                                              3Assumes development related to all remaining undeveloped acreage (about 277,000 acres of uplands,
                                              wetlands, and interior waters) In the August 1980 Inventory.

                                              Source; H. Crane Miller, "Federal Policies in Barrier Island Development," OCEANUS, Vol.          23, No. 4,
                                                      Winter 1980-81, Woods Hole Oceanographic institution.
                                   Ln
                                   0

                considerations.

                     Federal policy to protect the barrier islands must evolve
                from the starting position of current programs weighted by
                subsidy and financial assistance toward development, but
                somewhat offset by federal standards and regulations that
                attempt to mitigate known hazards and environmental problems.

                     Undeveloped, noncontiguous barrier islands present the
                greatest range of opportunity for protecting and preserving
                the islands: (1) by regulation of access; (2) by withdrawal
                of federal subsidies; and (3) by public acquisition. The
                opportunity to protect is greatest before development begins;
                enforcement of strong federal policies on issuance of bridge
                permits could effectively preclude extensive development and
                protect the noncontiguous islands without public acquisition.
                Each subsequent stage of development diminishes the potential
                effectiveness of federal, state, and local regulations and
                increases the federal financial assistance and subsidy to the
                community that would be required to mitigate or to "correct"
                adverse conditions. Hence, a critical focal point for a
                federal protection policy toward the remaining undeveloped
                barrier islands lies with the undeveloped, noncontiguous
                barrier islands.

                          Protecting Noncontiguous Barrier Islands

                        The critical focal point for a federal protective
                        policy toward the remaining undeveloped, noncontiguous
                        barrier islands is road, bridge, and causeway access.

                     Low-lying and vulnerable to complete inundation from
                storm surge, assaulted by wave action, storm scour, long-term
                erosion, as well as by high winds, barrier islands can be
                hostile environments for human settlements.     The natural
                dynamics of barrier islands, particularly on the ocean front,
                -directly oppose the human need for stability   to protect
                property. Thus, a federal protective policy     toward the
                remaining undeveloped, noncontiguous barrier    islands would
                logically seek to retain the islands in their natural
                condition, and to prevent or inhibit development. Taking
                effective action before development begins can make the
                difference between a protection policy that is both
                cost-effective and environmentally-effective, or a policy
                that espouses protection but is coupled with development that
                inex.orably draws increased federal involvement and cost.

                     The experience of the study communities demonstrates   that
                without road access little or no development took place.

               56

                 With road access the opportunity to develop opened, and
                 development followed. Once a commitment was made to a bridge
                 or causeway, whether funded privately, locally, or by the
                 state, and once development reached a level wherein issues of
                 safety, environmental degradation, and public health became
                 paramount, federal involvement was virtually foreordained and
                 politically irresistible. The scenario was repeated on the
                 Outer Banks, at Dauphin Island, at South Padre Island, and is
                 in process at St. Simons Island. The key is access.

                         A Federal protection policy will be enhanced by
                         continuing the historic federal position of not
                         participating in the initial costs of barrier island
                         access and other urban infrastructure.

                     Until the current federal subsidy programs were enacted
                 in the post-World War II era, particularly during the decade
                 of the 1970s, initial development costs on barrier islands
                 were borne by private interests, local or state governments,
                 or combinations thereof. This was the case in each of the
                 study communities which had acquired bridge or causeway
                 access: Kil-l Devil Hills and Nags Head, St. Simons Island
                 and Sea Island, Pensacola Beach, Dauphin Island, and South
                 Padre Island. Local or state revenue bonds, land sales,
                 private capital, or other financing measures were used to
                 finance the initial access and urban infrastructure required
                 to support development. The lack of federal assistance in
                 those years was not a constraint; building costs were lower
                 than today and building requirements not as stringent.

                     The amount, density, and types of development in the
                 study communities and prevalent along the Atlantic and Gulf
                 of Mexico coasts could not have taken place without bridge,
                 causeway, and road access. Except for very limited amounts
                 of exclusive development accessible only by boat or private
                 airplane, development on the barrier islands is characterized
                 by the  ease of access by automobile.

                         Development of most undeveloped, noncontiguous barrier
                         islands could be effectively regulated if
                         bridge/causeway permits were (1) denied or (2) granted
                         subject to enforced federal standards and no federal
                         subsidization.

                     Since each bridge/causeway complex that crosses navigable

                                                                              57

               waters of the United States is subject to a bridge permit
               from the U.S. Coast Guard, issuance of bridge permits has
               played a pivotal role in the development of the barrier
               islands. Federal regulatory authority over bridge permits is
               uniquely strong, by virtue of the navigation servitude under
               the Commerce Clause of the Constitution of the United States.
               Denial of a bridge permit would effectively preclude most
               extensive development of barrier islands. Conditions on
               Dauphin Island since Hurricane Frederic are dramatic evidence
               of the dependence of most beach resort development upon
               bridge and causeway access. However, permit denial may well
               be a politically unpalatable or untenable option, in which
               case a grant of permit subject to federal standards and
               conditions could also be effective in controling development.

                   Federal policy on bridge and causeway permits could
               require compliance with federal standards and permit
               conditions, and prohibit federal cost sharing of
               construction, improvements, repairs, or replacement except
               under stringent exceptions.

                   Federal standards now require elevation of a prestressed
               concrete roadway across wetlands and a single high span
               across the Intracoastal Waterway. The capital costs of
               building this type of bridge/causeway system currently range
               from $10 - $30 million per mile. Since the noncontiguous
               islands range an average of 2.5 to 5.3 miles from the nearest
               mainland road system on the Atlantic and Gulf of Mexico
               coasts respectively, the costs of access by bridge or
               causeway add several tens of millions of dollars to any
               potential development. Imposing bridge/causeway costs on the
               private sector would greatly affect the economics of barrier
               island development, making much of it on the noncontiguous
               islands economically infeasible. Few municipalities or
               states would fund such facilities at such costs without
               federal funding assistance or assurance of revenues from the
               resort far greater than could be generated by the typical
               beach resort with single family cottages, motels, and a
               seasonal, tourist-dependent economy. Relatively few of the
               remaining noncontiguous islands would be suitable for
               intensive, high-rise development, gambling facilities a la
               Atlantic City, or other intensive, revenue-producing
               development. Thus, in a great majority of the cases,
               imposition and enforcement of stringent federal standards for
               bridge/causeway design and construction and withdrawal of
               federal highway and bridge funds could be effective as a
               protective policy.

                   It is self-evident that bridges and causeways are the

              58

                necks of the funnels leading to and from the barrier islands.
                From a regulatory perspective, control of the neck of the
                funnel can effectively control whether development takes
                place initially.

                         Regulating Contiguous Barrier Units

                     Along the Atlantic and Gulf Coasts there are about
                139,000 acres of undeveloped uplands, wetlands, and interior
                waters contiguous to totally or partially developed areas.
                These contiguous units -- by definition -- are near existing
                roads and urban infrastructure. Recent estimates by Sheaffer
                & Roland, Inc., show existing roads within an average of 0.4
                miles of the undeveloped lands along both coasts, with more
                than 40 of the 85 units surveyed having access immediately
                adjacent to or through the undeveloped property. These
                conditions imply effective loss of the federal regulatory
                tool potentially most effective to control development on the
                barriers -- control of bridge and causeway access.

                    The study communities show a propensity for development
                to the greatest extent possible, pushing road systems, water
                supplies, and wastewater management to their limits. Federal
                involvement tends to increase with population densities and
                with each program that increases the capacity of individual
                systems to accommodate growth. Enlargement of a road system
                to accommodate traffic induces housing development, which in
                turn must be accommodated with increased water supply and
                wastewater management capacity. Ensuing development tends to
                exceed the built capacity of the infrastructure, leading to
                another round of expansion, upgrading, replacement, and
                reconstruction. Where the first round of development was
                characterized by single family dwellings, the second round
                tends to be characterized by higher density uses -- motels
                and condominiums, c.f., Pensacola Beach, Florida. Each
                successive round increases potential federal costs under
               .current programs.

                       on undeveloped contiguous barrier units, federal
                       regulations will generally not prevent or inhibit
                       development in the long term, but can reduce or
                       mitigate some potential adverse consequences.

                    in the case of contiguous barrier units, regulation
                implies minimum standards for development, e.g., property
                elevation requirements of the National Flood Insurance
                Program, and temporary curtailment of development where
                health, safety, or other standards are not met, e.g, septic

                                                                           5@

                system moratoria at Dauphin Island and St. Simons Island.
                Emphasis, nevertheless, is upon development; exercise of the
                police power to regulate building practices and land uses is
                not intended to and will rarely prevent development.

                    On the noncontiguous barrier islands, imposition   of
                federal bridge standards and removal of federal highway and
                bridge funds could effectively prevent development of most of
                the noncontiguous islands. The rationale is predominantly
                economic -- added capital costs of access, built to federal
                standards without federal subsidy, will make most beach
                resort developments economically infeasible. In the
                contiguous areas that powerful rationale has been removed to
                a large extent -- by definition, access and other urban
                infrastructure to support development are near at hand,
                reducing substantially the costs necessary to initiate
                development in those areas.

                    What of the added costs imposed by regulations?
                Regulations such as those of the National Flood Insurance
                Program unquestionably add to the capital costs of insurable
                structures to the extent that local building practices do not
                meet the Program's minimum standards. However, the
                experience of.the Program shows that its current regulations
                do not prevent development, and that in many areas people's
                expectations with respect to beach houses and oceanfront
                construction includes structures elevated on pilings, if not
                for reduced flood hazards, then for such aesthetics as a
                clear view of the ocean. As the Program gains more
                experience with the dynamics of coastal systems--high storm
                surge, wind-driven waves, storm scour, long-term erosion,
                high winds, and battering by debris -- its regulations will
                necessarily become more stringent. But the added costs
                imposed by the regulations cannot be reasonably expected to
                prevent development. They are not designed to do so.

                    In the case of regulations requiring elevation of
                structures to the wave crest level in coastal high hazard
                areas, it has been shown that the most or all additional
                capital costs to comply can be recovered by reduction of
                flood insurance premiums and by reduced average annual flood
                losses. For instance, elevation of houses to the wave crest
                level will increase piling, bracing, and other costs of
                oceanfront properties, but will result in significantly lower
                flood insurance premium costs than would have to be charged
                actuarially if the houses were elevated only to the 100-year
                storm surge level. Moreover ' the added capital costs of the
                flood insurance regulations (e.g., $3,000 - $8,000 estimated
                for a 2,000 sq. ft., one story, single family house,

                60

               depending on the foundation and bracing system chosenlo
               de,crease in significance as property values escalate.

                   From a national perspective, the importance of the
               minimum federal standards is their potential of reducing
               average annual flood loses. Properly managed, barrier
               islands can play an important role both in contributing to
               reduction of flood losses and in the federal policy of
               encouraging wise use of the nation's flood plains. Federal
               standards are an integral part of the effort to minimize
               flood losses to the extent practicable and to restore and
               preserve the natural and beneficial values served by flood
               plains. If the goal "to achieve an absolute decline in
               communities' average annual fliod losses due to unwise flood
               plain use" is to be achieved,   federal standards and
               regulations, such as those of the National Flood Insurance
               Program are essential. But it should also be recognized that
               those standards and regulations will not be adequate alone to
               achieve "an absolute decline in communities' average annual
               flood losses".

                   Implementation of federal regulations such as those of
               the National Flood Insurance Program can significantly reduce
               flood losses below those that would be experienced if the
               standards were not applied. Throughout the study communities
               there was strong evidence of the positive impact of the
               elevation requirements of the National Flood Insurance
               Program. As no other program, the National Flood Insurance
               Program has succeeded in making communities, financial
               institutions, building officials, developers, and consumers
               aware of flood hazard potentials. However, design to the
               100-year storm event can only reduce building losses for
               storms up to the design and safety limits of the structures.
               For example, a house built in a coastal high hazard area and
               elevated to the wave-crest level associated with a 100-year
               storm (as much as 55 percent higher than the storm surge
               level associated with such a storm) should be protected
               against wave forces to that height. But assuming a 50-year
               life expectancy for a coastal home, there is a relatively
               high possibility of a greater storm during that period
               (1-in-4 possibility of a 200-year event, that is, slightly
               greater than Hurricane Camille). A storm that exceeds the
               design limits of the structures then can produce catastrophic
               results.

                   The problem presented by the undeveloped contiguous
               barrier structures is that their development, even to federal
               standards, increases the potential for catastrophic loss in
               storms that exceed the design and safety limits of the

                                                                          61

                  structures. In addition, their development implies losses to
                  their supporting urban infrastructure, probably from storms
                  of lesser magnitude than the 100-year storm. Such losses may
                  more than offset the otherwise beneficial effects of the
                  regulations, and lead to the conclusion that the regulations
                  alone are not adequate to produce an absolute decline in
                  average annual flood losses.

                         Removal of federal subsidies for contiguous barrier
                         units development can be expected to inhibit but not
                         prevent development of those contiguous areas.

                     The availability of federal subsidies for access and
                  urban infrastructure can enhance any development, and in
                  certain instances can be the difference between an
                  economically feasible project or one that is not. Removal of
                  the federal subsidies will have the effect of shifting
                  significant portions of development costs from the federal to
                  the state, local, or private sectors, and could radically
                  alter the economic feasibility of a given project. This will
                  be especially so for the undeveloped noncontiguous barrier
                  islands.

                     The undeveloped contiguous barrier structures present a
                  different problem. In some instances, such as the 411-acre
                  undeveloped Epstein tract in Nags Head, roads and municipal
                  services run through the property, and major capital costs
                  for infrastructure have already been expended. In other
                  communities, the road and water supply system may need only
                  to be extended, e.g., the north end of South Padre Island, or
                  the north end of St. Simons Island. In such instances the
                  removal of federal subsidies may inhibit or curtail
                  development for a time, but is not expected to be a
                  protective device in the long-term. Because these areas are
                  so near to access and urban infrastructure, the capital costs
                  of extending these services for development purposes are
                  significantly less than for the initial development of a
                  noncontiguous area. In most such instances it will be
                  economically feasible for developers to provide the local
                  streets and to extend water and electrical service to permit
                  development. Streets will in most cases be donated to the
                  local government in return for the local government's
                  assumption of the costs to repair and maintain the roads.

                     Thus, the principal effect of removal of federal
                  subsidies on the undeveloped contiguous barrier structures is
                  expected to be a reduction in federal costs for expansion,
                  upgrading, replacement,, and,reconstruction of access and
                  urban infrastructure. But because development can be

                  62

              expected to continue despite withdrawal of the federal funds,
              increased disaster relief and flood insurance costs are
              anticipated unless these programs are modified and their
              hazard mitigation aspects strengthened.

                       Benefits of an Acquisition Policy

                     A federal protection policy will be strengthened by
                     authority and appropriations to acquire both
                     undeveloped contiguous and noncontiguous barrier
                     islands. Public acquisition of the islands is
                     cost-effective, and the surest means to protect
                     barrier islands from inappropriate development.

                  The estimated costs of current federal development
              policies for the remaining undeveloped barrier islands range
              from $25,800 - $26,400 per acre for the low acreage to
              $43,700 - $46,700 for the high acreage. In contrast, the
              acquisition costs of the National Seashores included in this
              study ranged from a low average purchase cost per acre of
              $75.35 at Cape Hatteras between 1950 and 1954, to $4,950 per
              acre at the Gulf Shores National Seashore between 1970 and
              1974. Using an average acquisition cost of $5,000 per acre,
              Sheaffer, Miller, and Rozaklis estimated that the cost to the
              federal government to continue its current development
              programs on the undeveloped barrier island would be more than
              five times greater than the costs of public acquisition of
              those islands. (See Table 14.)

                  Under a public acquisition program, priorities can be
              divided generally between contiguous and noncontiguous
              barriers. In many, if not most, instances, first priority
              should be given to purchase of undeveloped contiguous units,
              based on such objective factors as physical characteristics,
              resource values, and threats to those resource values
              (imminent development, pollution, loss of habitat, loss of
              open space, etc.). Moreover, noncontiguous units are less
              likely than contiguous units to be developed without federal
              bridge permits and federal assistance for bridge/causeway
              access and other urban infrastructure.

                  A public acquisition program on the noncontiguous islands
              would not be required, if the federal government chooses to
              adopt a more stringent bridge permit program than is now in
              force. if such regulations withstood inevitable judicial
              challenge, extensive development of the undeveloped
              noncontiguous barrier island would be effectively precluded
              and acquisition could be directed to contiguous barrier
              islands.

                                                                          63

                           0)

                                      Table 14. Comparison of Estimated Potential Costs of Public Purchase of Barrier Islands Versus
                                                Estimated Potential Costs of Current Federal Program to Support island Development

                                      Policy Option               Land in April 1900 Inventory       Land in August 1980 Inventory
                                                                  Low Case           High Case2      Low CaseI          High Case2
                                                                         J$ Billion)                            Billion)
                                      Estimated cost of
                                      public purchase               .80                 2.02                .46          $1.16

                                      Estimated cost of pursuing
                                      current federal programs    $4.13               $11.20              $2.46          $6.05

                                      Ratio of program costs
                                      to public purchase costs     5.2:1               5.5:1               5.3:1           5.2:1

                                      1Low case cost estimates based on purchasing or developing only uplands. The National Park
                                      Service's April 1980 inventory included about 160,000 acres of undeveloped, unprotected
                                      uplands; its August 1980 inventory included about 90,000 acres in this category.
                                      2High case estimates based on purchasing or developing both uplands and wetlands. The April
                                      1980 inventory Included about 480,000 acres of uplands, wetlands, and interior waters; the
                                      August 1980 Inventory included about 277,000 acres in this category.

                                      Source: H. Crane Miller, OCEANUS, cited in Table 13.

                   Judicial challenge would pit the federal government's
               authority to withhold bridge permits pursuant to the
               navigation servitude under the Commerce Clause against
               barrier island property owners' Fifth Amendment rights
               against the taking of their property without just
               compensation. Should property owners prevail, a public
               acquisition program on noncontiguous islands threatened with
               development would be a cost effective course and equitable to
               property owners. As with any form of regulation, public
               acquisition before development takes place would be the most
               cost effective action. At each incremental stage of access
               and urban infrastructure development, adjacent land values
               will increase. The government would get the most for its
               money before such development takes place.

                   In national terms the cost of a public acquisition
               program would be small compared to the federal costs of
               participating in barrier island development. Present "bulk"
               land purchase costs for the national seashores included in
               the study averaged less than $5,000 per acre. Agencies that
               rely more on voluntary land sales and less on condemnation
               procedures than the National Parks Service find average
               acquisition costs in coastal areas less than $5,000 per acre
               in 1980 dollars. These averages include parcels that may be
               as high as $85,000 per acre, but which represent small
               portions of the total acreage to be acquired; as acreage is
               subdivided in anticipation of development, the cost per acre
               increases.

                   The per-acre cost of acquiring undeveloped land in both
               contiguous islands and noncontiguous barrier units is
               estimated to fall in a range of $5,000 - $10,000 per acre
               (1980 dollars). When applied only to the upland portions of
               contiguous units, the estimated acquisition costs are $275
               million to $550 million, and for the noncontiguous islands,
               .$185 million to $370 million. Total acquisition costs for
               all contiguous and noncontiguous undeveloped upland acreage
               on the barrier islands would range from an estimated $460
               million to $920 million. If the history of National Seashore
               acquisition and the increase of coastal land values is any
               precedent, costs in the range of $5,000 - $10,000 per acre
               will be deemed sound and inexpensive investments not even 10
               years from now. Not only would they be inexpensive, but they
               would also be "repaid" in reduced or avoided federal
               subsidies and disaster relief expenditures.

                   The study showed that the federal government
               characteristically incurs costs on the barrier islands to

                                                                          65

                repair, improve, enlarge, upgrade, reconstruct, or replace
                bridges, roads, causeways, water supply and distribution
                systems, wastewater treatment systems, and flood and erosion
                control structures, or to provide disaster assistance and to
                subsidize flood insurance. An acquisition program of both
                contiguous units and noncontiguous units would effectively
                avoid or reduce those costs, and in that respect could be
                considered self-liquidating.

                    What of the impacts of federal land acquisition on land
                values in adjacent communities? Acquisition of the
                noncontiguous barrier islands should have little, if any,
                measurable impact on land values in adjacent mainland or
                island communities under certain conditions. Development in
                the adjacent communities can be expected to continue without
                dependence on the noncontiguous islands so long as there is
                no bridge or causeway access to the islands, and so long as
                full development in a broad regional context has not been
                reached or approached. Other factors, especially improved
                urban infrastructure, will have a more immediate effect on
                adjacent community land values than public acquisition of the
                noncontiguous islands.

                    To the extent that adjacent areas are totally or
                significantly developed, public acquisition of undeveloped,
                contiguous units would be expected to increase the value of
                adjacent lands. Examples were found in the study at
                Pensacola Beach, Florida, where lease values were reported to
                have increased when land on both sides of the City was
                acquired for the Gulf Islands National Seashore. In an area
                such as the Outer Banks of North Carolina, if the Currituck
                National Wildlife Refuge and the 411-acre Epstein tract in
                Nags Head were publically acquired, land values in the
                adjacent communities would be expected to increase. Under
                those circumstances, the towns of Nags Head, Kill Devil
                Hills, Kitty Hawk, and Southern Shores would be close to
                .fully developed, and land prices would escalate accordingly.

                         Conclusion

                    "Protection" measures such as regulations and removal of
                federal subsidies for access and urban infrastructure may
                forestall some barrier island development but generally will
                not prevent development. Among all regulations only a
                strengthened bridge permit program, coupled with removal of
                federal bridge construction funds, is likely to protect
                barrier islands from development, and then only with respect
                to noncontiguous islands. Regulations on access, urban
                infrastructure, and building requirements, and removal of

                66

               federal subsidies are important short-term measures; but
               their limitations as means to protect barrier islands need to
               be recognized.

                   If protection of the undeveloped barrier islands is to be
               a federal goal and is to be effectively achieved, a program
               of regulation, removal of federal subsidies for development,
               and public acquisition would need to be authorized and funds
               appropriated for that purpose. Such a combined program is
               the only effective way to protect the islands, and, through
               acquisition, the only fair way to compensate individual
               barrier island property owners for taking their right to
               develop the islands. Of all the available measures, the
               surest means to protect the undeveloped barrier islands is
               public acquisition.

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                                          REFERENCES

               1.  John R. Sheaffer and Louis Rozaklis, "Barrier Islands
                   Purchase: A Cost-Effective Approach to Management,"
                   testimony before House Committee on Interior and Insular
                   Affairs, Subcommittee on National Parks and Insular
                   Affairs, on HR 5981, March 27, 1980. Also, statement of
                   John R. Sheaffer, H. Crane Miller, and Louis Rozaklis
                   before the Committee on Energy and Natural Resources,
                   U.S. Senate, concerning S. 2686, June 12, 1980.

               2.  H. Crane Miller, "Federal Policies in Barrier Island
                   Development," Oceanus, Vol. 23, No. 4, Winter 1980-81,
                   Woods Hole Oceanographic Institution.

               3.  Interagency Agreement for Nonstructural Damage Reduction
                   Measures as Applied to Common Flood Disaster Planning and
                   Post-Flood Recovery Practices, 1980.

               4.  The Department of the Interior undertook a major review
                   of barrier island development in 1977, and has produced
                   an environmental impact statement and report, entitled in
                   draft "Alt6rnative Policies for Protecting Barrier
                   Islands Along the Atlantic and Gulf Coasts of the United
                   States." Bills pending in the 96th Congress (HR 5981 and
                   S 2698) dealt with barrier island protection.

               5.  Sally S. Davenport, "Development on Texas Barrier
                   Islands ... Does It Cost The Taxpayer More?", testimony
                   before House Committee on Interior and Insular Affairs,
                   Subcommittee on National Parks and Insular Affairs,
                   March 27, 1980.

               6.  Draft Supplement to Environmental Impact Statement for
                   Preferred Alternate Location for a Fleet Ballistics
                   Missile Submarine Support Base at Kings Bay, Georgia,
                   Primary Document 1980, at pp. 5-129, 5-133, and 5-138.

               7.  Sierra Club et al. v. Hassell, No. 80-7565, U.S. Court  of
                   Appeals, 5th-Ci-rcuit (Feb. 13, 1981).

               8.  Sheaffer and Rozaklis, supra note 1.

               9.  Miller, supra note 2.

               10. Federal Emergency Management Agency, Elevating to the
                   Wave Crest Level, (Government Printing office,

              68

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                  Washington, D.C., 1980).
    1(-       11. Interagency Agreementr supra note 1.
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