This is a cost benefit study that shows how much money the City of Long Beach has been losing because of the presence of the Long Beach breakwater.

Abstract

The Federal Government built the Long Beach portion of the three-segment breakwater in the 1940’s.  It has been hurting both the pocketbook and the spirit of the community ever since.  It has left Long Beach’s most valuable natural resource, the beach, polluted and unattended.  It was a waste of resources to build it, and it has never been fully utilized as a port.  This can however be corrected if those responsible return waves and help to clean the beaches by removing the Long Beach Breakwater.

When someone suggests removing the Long Beach Breakwater in order to restore the shore, the large costs are the first thing to come to mind.  But there are also tremendous benefits.  There are financial gains to be made by local businessmen, governments, and homeowners.  In addition, the people who live in the community can benefit in other ways.  When all of these are taken into consideration one can't help but realize that the long term benefits far outweigh the temporary financial costs.

Beaches are the leading destination for American tourists, and these tourists generate over $10 billion in California State revenue each year.  The portion of these tourist dollars that Long Beach has been missing due to the breakwater is staggering.  If the breakwater was reconfigured, Long Beach could expect beach tourism on the same level as Seal Beach.  This would pump an additional $50 million into the local economy annually.

Having a healthy and entertaining beach raises property values.  In a recent survey, it was found that Long Beach had the lowest coastal property values of any of the nearby comparable communities including Seal Beach, Surfside, Huntington, Hermosa, Redondo, and Manhattan Beaches.  The one component shared by the other communities is waves and water clean enough to swim in.

In addition to the material wealth gained by restoring the beaches, other benefits include:  low-cost recreation for the community, improved beach habitat for rare and endangered species, improved kelp beds for use by divers and sport fishermen, and the City of Long Beach’s (rolling waves) marketing campaign would finally be appropriate.

Introduction

This paper attempts to explain some of the benefits associated with the proposal to remove the Long Beach Breakwater in an effort to restore breaking waves on the beaches, increasing water circulation, and ultimately reducing pollutants in the nearshore zone.

There are three breakwaters that block wave penetration from San Pedro all the way to the east end of Long Beach.  The “Long Beach Breakwater” is the easternmost of the three, the portion that keeps waves from breaking on the sandy beaches of Long Beach.  This proposal has no bearing on the other two breakwater sections nor would it significantly impact operations at the Port of Los Angeles or the Port of Long Beach.

The breakwater was originally designed to create a wave shelter for development of a port and use with the Long Beach Naval Base.  So far, the Naval Base has been closed, no port has been developed inside the Long Beach Breakwater, and no port is foreseen in this area the future.  Today, the breakwater blocks not only waves, but also some specific community benefits, including many for which a monetary value can be estimated.  There are also intangible benefits consisting of aesthetics, communion with nature, and a sense of community pride.

This paper begins with a review of previous work performed on the topic of beach worth, followed with a study of the dollar value of a restored Long Beach.  Next is a listing of some intangible benefits from a restored beach, concluding with a list of the challenges associated with breakwater reconfiguration.

Past Studies

Many studies have been performed concerning the value of beaches in general and some highlights are given here.  These studies contain analyses of similar recreational areas throughout North America.

• Of all the ocean industries contributing to the California economy, tourism is the largest contributor at $9.9 billion, with the next largest contributor being ports at $6.0 billion[1]. 
• Travel and tourism account for about 10% of America’s gross domestic product. Beachgoers spent $74 billion per year with the most popular recreational activities being swimming, sunbathing, and walking in coastal areas¹.
• California State Beaches equal less than 3% of State Park holdings but 72% of State Park attendance[2]
• California beach attendance outweighs all combined theme and amusement parks attendance by 200 to 1. ²
• $10.6 billion in direct state revenues were generated from coastal tourism and recreation and $1.1 billion in state tax was generated directly from California coastal tourism and recreation².
• 40% of all Americans listed beaches as their favorite vacation destination².
• Beaches are the leading destination for American tourists[3]

When the above facts are considered, the magnitude of California’s coastal tourism comes into light.  It clearly states that people are willing to pay considerable sums of money to simply go swimming in clean water or to walk along a healthy beach.

Dollar Value of A Fully Restored Beach

How much would the City and citizens of Long Beach benefit if the water was made clean and the waves were returned to Long Beach?  An attempt is made to answer this question by comparing Long Beach visitor rates to those of nearby beaches as well as comparing local real estate values.

As part of this study, existing data was gathered to compare the number of people per day, per mile visit nearby beaches.  The average of the annual estimated beach use rates are summarized in Table 1.

Table 1.  Local Beach Visitor Rates

The Long Beach use rates given above are most likely too high based on observed differences at Long Beach and other beaches.  Nevertheless, these conservative values still prove the point.  Photographs taken of these beaches on Labor Day, 2000 provide additional evidence.  These are shown in Figures 1 through 4.

Figure 1. Long Beach

Figure 2. Seal Beach

Figure 3. Huntington Beach

Figure 4. Manhattan Beach

[3] Center for Marine Conservation, The Health of the Oceans.

 

It would be safe to say that if Long Beach were restored, the beach use rates would be about equal to the current use rates of nearby Seal Beach.  This seems reasonable since Long Beach has at least an equal amount of land-based services and infrastructure.  Long Beach use rates would increase an amount equal to 2,058 people per mile, per day (4,915 – 2,856 = 2,058 people).  With the sandy beach at Long Beach being 4.2 miles long this results in an increase in 8,645 people per day (2,058 people/mile x 4.2 miles).  Assuming a beach user value of $16.75 per day[1], this results in a loss of $144,811 per day.  The beach user value includes money spent on transportation, lodging, entertainment, shopping, and meals.  If the daily value were carried out to one year, the loss is $52,856,000.  This is the approximate beach use revenue not gained by the citizens of Long Beach due to the lack of clean water and waves.  The Long Beach Breakwater was finished in 1949, and has kept beach tourist away since then.  Imagine the staggering amount of lost revenue that could have been gained over the past fifty years if there had been no breakwater.  

This calculation does include the revenue that would come to business owners all along the coastline and inland.  This is revenue that would come to downtown, Pine Street, Shoreline Village, Belmont Shore, Marina Pacifica, and other business districts.  This beach use value does however exclude increases in revenue to client bases of existing businesses that would experience an upturn if they weren’t fighting the present handicap of the reputation of Long Beach as an environmental write-off.  Imagine the easier job that the Long Beach Convention Center and Visitors Bureau would have to attract more visitors to our city if they could leverage the full image of a Southern California beach experience.

 

A recent survey of published beachfront property values has the Long Beach coastal zip code at the bottom of the list.  A summary is given in Table 2.

 

Table 2.  Coastal Home Prices by Zip Code[2]

Zip Code	Median Home Price	Location
90743	$965,000	Surfside (one house sold)
90266	$706,000	Manhattan Beach
90254	$605,000	Hermosa Beach
90277	$501,000	Redondo Beach
92648	$470,000	Huntington Beach
90740	$445,000	Seal Beach
90803	$440,000	Long Beach (bounded by Cherry, Broadway & Peninsula)

 

This raises the question, what do the other beaches have that Long Beach does not?  Two missing valuable assets are obviously clean water and surf.  Restoring the beaches would raise property values, not just at the coast, but for many blocks inland as well.

 

This study did not include the increased value of healthier and more edible fish due to cleaner water.  Future work could analyze the added tax benefit through direct sales tax as well as increased property tax.

Intangible Benefits

Some benefits to the community are more difficult to quantify.  They nevertheless should be listed since they are included in the quality of life statistics used when comparing communities.  A laundry list of less tangible benefits is given here: 

 

1. Clean water and surf provide low cost exercise and recreation for all communities;
2. Outdoor exercise can reduce stress leading to lower crime rates and happier citizens;
3. California beaches provide critical habitat for numerous species such as the California grunion, and, sand crabs; and
4. Reconfiguration of the breakwater can provide valuable kelp habitat for species rehabilitation, sport fishing, and diving.

Costs & Challenges

A review of the direct and secondary costs associated with the removal of the breakwater is beyond the scope of this paper.  However, as an aid to discussion, a list of what those items are is included.

1. Direct removal / reconfiguration construction costs;
2. Beach nourishment costs;
3. Wave damage or protection costs to: Oil islands, Belmont Pier, Long Beach Marina, The Queen Mary, Catalina Landing, Queensway Bay, and Shoreline Village;
4. Increased shoreline erosion or increased beach nourishment; and
5. Relocation of armament loading from Long Beach Outer Harbor to Anaheim Bay, the Port of Long Beach or Port of Los Angeles.

Conclusion

While the difficulties of removing the breakwater are immense, they are of a scale that can be overcome.  After all, the breakwater was built by the same people and government who can take it down.  Only when a non-biased third party performs a complete benefit to cost analysis will it be known how greatly the community can benefit by removing the breakwater and restoring Long Beach’s namesake beaches.  Clearly there are direct economic benefits associated with tangible items such as tourism and increased property value.  But beyond that there are other important benefits that the residents of Long Beach and other nearby cities can reap with the restoration of the natural beaches and oceans.  Figure 5 is a great example of one of those non-tangible benefits.

 

Figure 5. Father and Son at Another Beach

 

 

In closing, if the breakwater is good for the coast, then why then aren’t neighboring communities putting up wave-stopping breakwaters in front of their beaches?

 

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[1] Personal communication with Vernon R. Leeworthy. Testimony of Hanemann in the American Trader Oil Spill court case, Huntington Beach, CA, 1990.  Also from Bell, Frederick W. and Leeworthy, Vernon R., An Economic Analysis of the Importance of Saltwater Beaches in Florida, SGR-82, February, 1986. 

[2] L.A. Times Real Estate Section, June 25, 2000.