746 • Wetlands: Their Use and Regulation 



industrywide estimates. Very few trade associations 

 have collected detailed statistics from their mem- 

 bership. 



The desire to reduce costs brought by the 404 

 program to permit applicants has been a major fac- 

 tor in many or most efforts to change the 404 pro- 

 gram through legislative and regulatory revision. 

 Many industry associations and firms have voiced 

 their unhappiness with the current program. In par- 

 ticular, the program is said to be unnecessary, or 

 at least overly restrictive and cumbersome, and to 

 cause large financial losses to permit applicants 

 through modifications and delays to projects im- 

 posed by Federal agencies. The Office of Manage- 

 ment and Budget (OMB) stated that its suggested 

 reforms to the program could save $1 billion an- 

 nually.' On the other hand, defenders of the pro- 

 gram argue that it is not costly, either in absolute 

 terms or in comparison with the benefits it brings, 

 and that many sectors of society, including several 

 major industries, are aided by the program.^ 



This section discusses perceptions of the 404 pro- 

 gram held by regulated sectors and the costs and 

 benefits to permit applicants of this program. There 

 is a paucity of data on the costs and benefits of the 

 404 program and of other Federal and State wetland 

 programs to regulated sectors. OTA examined pre- 

 viously published estimates, surveyed industry as- 

 sociations, and collected data from other sources 

 (4). OTA also surveyed States about whether they 

 had made estimates of the costs to permit applicants 

 of State or Federal wetland permitting programs. 

 No State had collected information on such costs. 

 Massachusetts officials estimated that, assuming 

 that the average bank carrying cost "to hold op- 

 tion on raw land, assuming an average 20-acre sub- 

 division, single-family homes," of a project is 

 $2,000/month, and the average decision time for 

 State permitting is 2.5 months, the average cost to 

 the project would be $5,000, plus consulting and 

 legal fees. Several States gave data on permit fees 

 charged to applicants. Not including EIS costs, fees 

 ranged from zero (e.g., Maryland) to 0.5 percent 

 of construction costs with a minimum of $100 (New 



'Office of Management and Budget press release, May 7, 1982. 



^National Wildlife Federation and 13 other organizations, "Sec- 

 tion 404: A Response to the Army-OMB Regulatory Reform Pro- 

 posals," May 1982. 



Jersey). Most fees ranged from $15 to $75. One 

 industry association, the Fertilizer Institute (FI), 

 reported that permit application fees in Florida now 

 are $100 for the short form, for more minor proj- 

 ects, and $1 ,000 for the stcindard form, for relatively 

 major projects. 



Benefits of the 404 Program to 

 Regulated Sectors 



Environmental Benefits Captured by Industry 



Many types of firms experience both costs and 

 benefits from the 404 program. For example, mem- 

 bers of the housing-construction industry believe 

 that 404 program costs severely impact the indus- 

 try's operations; at the same time, land values ad- 

 jacent to wetlands protected by section 404 often 

 increase, benefiting some builders as well as existing 

 homeowners. 



The RIA questionnaire asked Corps districts to 

 rate the impacts of the regulatory program (includ- 

 ing sec. 10) on 14 sectors (5). Districts unanimously 

 believed that the fishing industry benefited from 

 the program and were near unanimous that the 

 general public benefited. More than 80 percent 

 thought that government and public service and 

 land values adjacent to permit areas benefited, and 

 more than 60 percent saw benefits accruing to the 

 agricultural industry and to private individuals (6). 



Technology Transfer 



Advice given by Federal personnel to permit ap- 

 plicants prior to submission of an application, and 

 in the course of permit review after submission of 

 an application, may result in savings to applicants 

 as well as protection of wedands. Small projects and 

 private individuals, in particular, may benefit from 

 information about current engineering and man- 

 agement practices that can make projects more ef- 

 ficient and less cosdy. Called "technology transfer" 

 by the Corps, these practices produce such benefits 

 as avoidance of erosion losses and stabilization costs 

 when natural vegetation and drainage features are 

 preserved and utilized. 



Based on a telephone survey of 12 districts, the 

 IWR report estimated that for 15 to 30 percent of 

 issued permits, the projects approved are more ef- 



