Economic Impact of China Lake Watershed
For the China Lake Association
For the China Lake Association
"Water is our most precious and interconnected natural resource. It sustains all ecosystems, communities, and economies from local watersheds to the seas. It's vital to sustaining our health, safety, and the environments in which we live and work. Simply put, water is life."
Watersheds are areas of land that drain all streams and rainfall to a standard outlet such as a lake, river, bay, or other body of water. A natural topographic boundary separates water flow into different drainage basins. Watersheds play a crucial role in the hydrological cycle, influencing the quality and quantity of water that eventually reaches larger bodies like rivers, lakes, and oceans.
This narrative telling of the economic footprint attributable to China Lake Watershed is intended to provide an educational outreach resource for the China Lake Association. It provides a concise overview of critical characteristics within the watershed, including demographic, environmental, and economic information. Designed to serve stakeholders, community service providers, economic development agents, and policymakers, this abstract offers insights into the unique factors shaping the environment and driving economic activities within the Watershed area.
China Lake is categorized as an impaired Great Pond Class A (GPA) lake with two basins (east and west). The China Lake Watershed includes smaller drainage areas such as Evans Pond, Hunter Brook, Muldoon Stream, Starkey Brook, Jones Brook, and Ward Brook, along with 19 smaller tributaries. The topography within the watershed features a blend of rolling hills surrounding wetlands and pond basins. China Lake contains several small islands, including notable ones like Indian Island, Green Island, Bradley Island, and Moody Island, which are seasonally residential. ( 2021 Watershed Survey )
China Lake has one outlet, Outlet Stream, located on the western shore of the west basin, flowing north through Vassalboro to Winslow, where it enters the Sebasticook River. The Outlet Dam is owned and operated by the Town of Vassalboro.
The primary land uses in the Watershed are forestland, agriculture, residential development, and some urban and commercial activities. The east basin of the Watershed is primarily developed, mainly with residential homes and a shoreline that is dotted with camps and houses. Conversely, the west basin of the Watershed is predominantly rural with much less residential development. Much of the western shoreline remains undeveloped as the Kennebec Water District (KWD) owns an undisturbed buffer zone around nearly the entire basin. The Town of Vassalboro holds only two developed shorefront lots, with the rest owned by the KWD.
To develop this analysis of the China Lake Watershed, we modeled it on an earlier effort at Colby College for the Belgrade Lakes Watershed Project that resulted in a statistical abstract in 2012. Here, we identified three towns within the China Lake Watershed (China, Vassalboro, and Albion). With geographic information from the US Census Bureau, we delineated the "Census blocks" within each town in the Watershed's physical boundary. A Census block, the smallest geographic unit for US Census data collection and reporting, varies in size, being smaller in densely populated urban areas with intricate boundaries and more significant in size in rural regions covering extensive areas with natural features and scattered populations. The objective for the definition of Census blocks is to establish uniform units to accurately collect and analyze demographic and housing data. Census block groups represent the next level of aggregation for demographic data and, in general, define a city or town. In the graph at right, the China town line with its 3 Census block groups is represented by the green border overlaid on the China Lake Watershed which is defined by the red boundary. The town of Vassalboro borders China to the west and Albion lies to the north.
Town "touched" by the China Lake Watershed | Percent of Population Living in the Watershed |
---|---|
Albion | 5% |
China | 63% |
Vassalboro | 6% |
CL4ES Calculations Using US Census Data
The China Lake Watershed boundary intersects with each of the 3 Census block groups that define the town of China. We employed satellite imagery and GIS mapping to estimate the proportion of the total population in each census block residing in the Watershed. For blocks partially in the Watershed, we manually counted the houses using Google Maps Street View, finding roads that followed the Watershed boundary and overlaid the Census block group boundaries. To estimate the population, we multiplied our count of "households" defined in this fashion by the reported average household size for the town of China (2.5 people/household). The table below enumerates cities and towns entirely or partially located within the China Lake Watershed.
Click on the chart to enlarge
The bar chart to the right and the table below illustrate distinct population trends across Census block groups within the Town of China. Block Group 1, with its China Lake shoreline properties experienced substantial growth, with a remarkable 22.9% increase in population since 2008, suggesting significant demographic shifts or perhaps successful urbanization initiatives. Conversely, Block Group 2 witnessed a notable decline in population of 18.5%, indicating potential challenges or migrations impacting that specific area of China. Block Group 3, with only a limited number of homes in the Watershed, saw modest but positive growth of 4% since 2008, suggesting relatively stable population dynamics. Overall, the data hints at complex population dynamics within China likely influenced by various factors such as urbanization, economic development, government policies, and regional disparities.
Ecosystem services from lake watershed environments can significantly stimulate local and regional economic activity directly or indirectly through their interactions with the built environment. An economic impact analysis is a method by which economists and policymakers can determine the effect of these services on the regional economy. Using an Impact Analysis for Planning (IMPLAN) modeling framework, we quantify the multiplicative impact for labor force information for the Town of China into direct, indirect, and induced effects on the regional economy.
Using a ‘follow the water’ paradigm, we try to determine the economic contributions of industry-specific levels of employment and wages to overall economic activity in Kennebec County. Using the IMPLAN framework, we can calculate the impact through direct, indirect, and induced effects across our identified spending categories. By inputting recent employment and wage incomes (direct effects) into the model we can then apply multipliers to estimate the overall contributions to Kennebec County. Indirect effects come from economic interactions among industrial sectors due to purchasing or supplying inputs across sectors (for example when one business buys services from another in the region). Induced effects occur through the linkages between an affected sector of the economy and households based on labor supplied and wages paid to capture implicit relationships concerning resulting changes in household spending. The aggregate value of these three effects provides our estimate of the total economic impact.
Top 10 Industries by Employment: input
The Multiplier effect shows us how one person's spending becomes someone else’s income in the Town of China and in Kennebec County as a whole.
Economic Indicators by Impact: output
The Value of the Lake Watershed to Residential Home Prices in China
As noted above, approximately 63% of the population in the Town of China is located within the Watershed. To provide an alternative assessment of the economic footprint of the Watershed we crafted a model of home prices using data from the Town of China and GIS mapping tools. The type of statistical analysis we did includes the construction and estimation of the parameters in a hedonic regression model. Hedonic regression modeling is an econometric tool for evaluating the effect of key characteristics on the price or demand of an item. In our application we modeled the impact of characteristics that explain variations in historical sale prices for homes in the Town of China.
Some of the characteristics that we wanted to use were readily available from the Town Assessor’s database. These included the year of sale, size of the property in acres, living area for the home, the number of bathrooms, and the number of bedrooms. The Assessor’s database does not explicitly identify residential properties so we had to do a bit of data cleaning to identify properties that would be appropriate for our model. Specifically, we used guidelines provided by the assistant to the Assessor’s agent for properties that qualified for a homeowner’s exemption. We also limited our sample to those properties that had bedrooms and bathrooms, a positive value for square foot living area, and a positive value for the size of the lot.
The goal for this portion of our study was to estimate the effect of the Watershed on the price of a home. The Assessor’s database does not accurately identify all shoreline properties within the China Lake Watershed either in terms of location of the amount of lake frontage. Using Geographic Information System tools available from the U.S. Census Bureau in combination with the ArcGIS ESRI mapping and analysis software package we geo-located the latitude and longitude for each address in the Assessor’s database. We then overlaid these geotagged locations onto the GIS boundary for the Watershed available from the Maine State Geolibrary to identify locations within the Watershed’s boundaries. Geotagging did not always identify the precise physical location of the home, but did provide an accurate location for the property in terms of the mailbox location.
The technical details for our modeling efforts are included in our final report. Based on our econometric model of home prices for the Town of China we found that homes located inside the China Lake Watershed sold on average for 16% more than comparable homes outside the Watershed.