Ecosystem Services 23 (2017) 209217

Contents lists available at ScienceDirect

Ecosystem Services
journal homepage: www.elsevier.com/locate/ecoser

Longitudinal analysis of ecosystem services' socioeconomic benets: MARK

Wastewater treatment projects in a desert city

Bjoern Hagena, David Pijawkaa,b, , Mihir Prakashc,1, Shreyash Sharmad
a
School of Geographical Sciences and Urban Planning, Arizona State University, 975 S Myrtle Ave, Tempe, AZ 85281, United States
b
The Julie Ann Wrigley Global Institute of Sustainability, Arizona State University, 800 South Cady Mall, Tempe, AZ 85281, United States
c
School of International and Public Aairs, Columbia University, 420 W 118th St #1410, New York, NY 10027, United States
d
School of Computer Science, Arizona State University, Brickyard Engineering (BYENG) 553, 699 S. Mill Ave., Tempe, AZ 85281, United States

A R T I C L E I N F O A BS T RAC T

Keywords: This paper addresses the socioeconomic dimensions and public perceptions of ecosystem services oered by
Ecosystem services green wastewater infrastructure in a desert city over 20 years, taking an in-depth look at the valuation of these
Green infrastructure services. While there was signicant controversy and public conict over the location of the original wastewater
Socioeconomic impacts treatment facility and an initial decrease in property values, the average assessed property values in the study
Alternative wastewater treatment
area increased relatively quickly. Within ve years, they met and exceeded the average property values in the
Contingent valuation
Metropolitan Phoenix Area. Our longitudinal study found that anticipated nuisance eects did not materialize
with the operation of the facility and that residents were satised or very satised with the area's quality of life
as well as its environmental quality. The results also show that the co-benets of articial wastewater wetlands
and green recreational space associated with the use of euent and groundwater recharge enhanced
developments around these facilities, making these places socially acceptable. Finally, we determined that
proximity to views of water and parks, especially in desert cities, adds substantial value. Home prices showed
remarkable resiliency in neighborhoods around constructed water projects that lter euent, provide enhanced
place-making aesthetics and recharge the groundwater aquifer, the most critical ecosystem service.

1. Introduction This paper addresses the socioeconomic dimensions and public

Recently, there has been an upswing in research activity and
publications on valuing urban ecosystem services, particularly on
methods and approaches to measure their benets (Boyer and
Polasky, 2004; de Wit et al., 2012; Fisher et al., 2011; Gmez-
Baggethun and Barton, 2013). Much of this interest falls into discrete
areas such as contingent valuation analysis (Mitchell and Carson,
1989); property value benets from largely aesthetic enhancement of
ecosystem features (Ignatieva et al., 2011); the use of measuring the
land value eects through hedonic price modeling (Abbot et al., 2015;
Klaiber and Smith, 2013); long-term benets of ecosystem recovery,
i.e., wetlands (Bullock et al., 2011); and the utility of using natural
resources for urban environmental infrastructure (Cook, 2015;
Vymazal, 2010a). For example, there is signicant research and
literature on urban parks as a community amenity (Kowarik, 2011;
Lee and Mahewaran, 2011). Yet, the socioeconomic impacts of these
parks as places for providing ecosystem services remain largely
unstudied.
perceptions of ecosystem services oered by green infrastructure,
namely constructed wetlands and public parks as recharge basins for
groundwater recharge, in a desert city. The paper looks at three
projects in one city, Avondale, Arizona, and assesses the impacts
through public surveys and property values over two decades. By
looking at longitudinal impacts, this paper adds value and original
contributions to the literature of ecosystem services.
According to the Ecological Society of America (Ecological Society
of America (ESA), 2012), ecosystem services are the processes by
which the environment produces resources that we often take for
granted such as clean water, timber, habitat for sheries, and pollina-
tion of native and agricultural plants. These processes exist in every
ecosystem in which humans live cities, rural and agricultural areas,
forests, and deserts. Services include cultural (e.g. recreation); provi-
sional (e.g. food, water, medicines); regulatory (e.g. air quality, ood
control); and supportive (genetic diversity) (Bolund and Hunhammer,
1999; Mooney et al., 1997). In a recent survey of homeowners, cultural
values were identied specically as aesthetics, personal enjoyment,

Corresponding author at: School of Geographical Sciences and Urban Planning, Arizona State University, 975 S Myrtle Ave, Tempe, AZ 85281, United States.
E-mail addresses: bjoern.hagen@asu.edu (B. Hagen), pijawka@asu.edu (D. Pijawka), mihir.prakash@gmail.com (M. Prakash), s.sharma@asu.edu (S. Sharma).
1
Present address: New York City Mayor's of Technology and Innovation, City Hall, New York, NY 10007, United States.

http://dx.doi.org/10.1016/j.ecoser.2016.12.014
Received 17 July 2016; Received in revised form 19 December 2016; Accepted 22 December 2016
Available online 03 January 2017
2212-0416/ 2016 Published by Elsevier B.V.
B. Hagen et al.
and low maintenance (Larson et al., 2016).
While the potential value added in developing articial lakes and
lagoons to provide wastewater euent treatment and groundwater
recharge is recognized, ecosystem service values are not easily mea-
sured due to the interconnected intangibles they provide. Timothy
Beatley's Biophilic Cities (Beatley, 2011) provides ample evidence of
the importance of these services to physical and mental health,
community resiliency, place making, pollution abatement, and heat
island mitigation among other community benets. None of the
previous works, however, specically discuss measuring nature's value
in socioeconomic and cultural terms.
This paper builds on these works as it is grounded in the larger
context of valuing urban ecosystem services, specically the develop-
ment of human-constructed features that lter and clean wastewater
euent in a desert city (i.e., constructed recharge basins and articial
wetlands), to understand their socioeconomic impacts. It is important
to recognize that this study focuses on the larger and longer picture of
ecosystem service impacts. Therefore, it does not measure the specic
monetary benets of direct and regulatory aquifer recharge nor the
indirect amenity values in maintaining park space and designed
residential-based lagoons for groundwater discharge. Rather, the study
looks at the direction and magnitude of property values around these
facilities as an indicator of public perceptions of value added, quality of
life, and community support.
The principal method for wastewater euent treatment, both in the
past and today, is for cities to invest in technological wastewater
treatment facilities (WTFs). These facilities are often located at the
lowest point of the sewage collection watershed in order to reduce
pumping costs or at the edge of the city. Water waste from homes and
industry is typically piped to WTF plants through sewer systems. The
plant treats this water to remove contaminants such as solids and
toxins then the remaining wastewater euent is further diluted
through surface water resources such as lakes, rivers, or more often
recently, transferred to places for groundwater discharge.
Lakes, rivers, and wetlands naturally dilute pollutants from waste-
water using vegetation, soils, and microbial assemblages. Constructed
wetlands are engineered to mimic these natural processes.
Investigations into wetland and other aquatic plant systems to treat
wastewater euent were initially undertaken in various European
countries by Seidel (1976), Kickuth, (1977), de Jong (1976) and
others. By the end of the 1960s, engineering of natural wetlands for
wastewater euent treatment was being explored in North America
(Ewel and Odum, 1986; Kadlec et al., 1979; Odum et al., 1977). Since
then, it has evolved into an eective wastewater euent treatment
technology (Vymazal, 20102010b).
Treating wastewater euent through wetlands and recharge basins
can greatly benet cities, especially those in dry desert regions, by
augmenting and replenishing groundwater aquifers. Other benets
captured in this study include cost savings from reduced operations of
WTFs; establishment or enhancements of parks and open spaces and
their recreational co-benets; aesthetic enhancements; and land value
enhancements (Department for Environment, 2007; de Wit et al.,
2012). Another potential benet for urban areas is the development of
neighborhoods around these derived ecological system assets.
Residential developments emerged around two of our sites adding
considerable tax revenues to the city. The importance and resiliency of
these places can be measured in long-term property value impacts. This
paper looks at this socioeconomic benet for properties around urban
constructed wetlands as an indicator for valuing ecosystem services.
Beyond the potential benets of alternative wastewater treatment
options, we know little about the magnitude and direction of changes
resulting from these options and even less about the changes when
these options are implemented in desert cities. There are exceptions of
course and a few studies are available. Most of these concentrate on
how to implement these measures and their various dimensions rather
than focusing specically on impacts, however (Assessment, 2005;
210
Ecosystem Services 23 (2017) 209217
Fisher et al., 2011; Howarth and Farber, 2002). Therefore, this paper
aims to understand the community value that can come from
ecosystem services. We look at the socioeconomic impacts using
property value increases as indicators of positive public responses to
the WTF and the resiliency of surrounding neighborhoods. Using this
approach, we can also measure the co-benets of ecosystem services.
1.1. Objectives
This paper takes an in-depth look at the valuation of ecosystem
services by comparing alternative wastewater euent treatment op-
tions in one city. It explores three types of infrastructurea conven-
tional sewage treatment plant, a multi-faceted recharge basin and open
space recreational center, and a constructed urban residential wetland
sitein Avondale, Arizona, a city located in the Phoenix Metropolitan
Area, and analyzes them longitudinally. Overall, the analysis covers a
period of approximately 20 years (19962016), providing longitudinal
data and demonstrating signicant community benets from ground-
water augmentation, the park-based recharge basin, and constructed
wetland projects. This study also validates ecosystem services valuation
(National Research Council (NRC), 2012). Moreover, some of the key
questions for urban planners and designers concerning the socio-
economic eects of ecosystem design alternatives are answered in this
paper. These questions center on the public acceptance of wastewater
treatment via community built ecological systems or green infrastruc-
ture.
We hypothesize that alternative WTFs in desert cities oer park-like
and water-based features that attract people to them, create a sense of
place, and are socially acceptable. We explore the public acceptance of
these ecologically designed infrastructure projects despite the percep-
tion of potential risks. Finally, we verify that the co-benets of these
types of projects result in property values increasing, as the literature
suggests, thus adding to the area's attractiveness, place-making identity
and resiliency (Polyakov et al., 2013). Having three distinct ecological
features in separate locations of the same city that respond to dierent
needs provides important triangulated data and cases to support our
hypotheses (Benford et al., 1993; Zhang et al., 2010).
1.2. Background
Some land uses such as sanitary landlls, hazardous waste manage-
ment facilities, recycling plants, nuclear waste sites, and certain
manufacturing industries and infrastructure often face strong commu-
nity opposition, especially by residents living in the vicinity of the
proposed development. This not-in-my-backyard (NIMBY) phenom-
enon can play a signicant role in the public's negative attitude towards
these types of land uses, as they are perceived to present local risks and
nuisances while their benets are distributed throughout the commu-
nity. Among the list of unwanted land uses are sewage treatment plants
(STPs) and (WTFs) (Fitchen, 1991), such as the Avondale Wastewater
Treatment Plant built in the mid-1990s in the southern part of the city.
This WTF is included as one of the three types of infrastructure in this
study, acting as a control case.
Although these facilities provide benets to the entire community,
critics point to disamenities and negative externalities that impact the
areas where they are sited, i.e., posing risks and threats to nearby
residents (Bell, 2008). Among the most common perceived threats are
adverse health impacts, noise pollution, vector-born diseases, noxious
odors, trac congestion, and declining property values. STPs and
WTFs are often looked at as noxious facilities and as such create risk
amplication eects due to their risk and disamenity perceptions. Risk
amplication was coined by Kasperson et al. (1988) to illustrate how
the public perceives risk at much higher levels than what the scientic
risk analysis would suggest.
Transcripts of the Avondale WTF public hearings regarding its
siting mention numerous concerns including nuisance eects (noise,
B. Hagen et al.
odor, trac); negative health impacts (direct and indirect eects of
potential insect infestation); ecological impacts (increased ooding,
water pollution); quality-of-life eects (residents may not be able to
continue the same neighborhood activities); and economic loss due to
property value diminution (Gawande and Jenkins-Smith, 2001). The
potential decline of property values was a primary concern raised by
the public during the initial siting hearing that demonstrated strong
risk amplication eects.
The relationship between property valuation and the proximity to
wastewater treatment facilities is based on the hedonic price theory
(Lancaster, 1966; Rosen, 1974), which argues that the value of a good
declines in utility due to non-market quality variables such as the
decline of environmental amenities. Research shows that WTFs or
other noxious facilities and the associated or perceived risks can result
in stigmatization of an area, reducing property values in the vicinity
of such facilities (Nieves, 1993; Renn et al., 1992). Real estate stigma is
used to describe an adverse public perception regarding a property
which extracts a penalty on the marketability of the property and hence
its value (Bell, 2008). One objective of this paper is to demonstrate
that alternative wastewater treatment options such as constructed
wetlands oer signicant co-benets (i.e., open space ecosystems) that
oset real estate stigma.
Although public risk perceptions are a strong predictor for the
relationship between hazard proximity and property value (White
et al., 2010; Zeiss and Atwater, 1989), this study shows that perceived
risks can be reduced with respect to a WTF site and wastewater euent
treatment can be seen as an amenity when constructed wetland
systems and/or recharge basins combined with recreational options
are used in addition to conventional treatment plants. This is exem-
plied by public responses in Avondale. Initial opposition to siting the
WTF close to residential areas gave way to acceptance of both the
facility and the more sustainable practices in managing wastewater.
Today, these types of combinations are becoming the preferred option
for many municipalities due to the burden of EPA requirements for
discharging euent.
This study also shows that constructed wetlands present opportu-
nities for long-term, benecial ecosystem services. For instance, studies
on the valuation of properties around open space ecosystems show that
the spatial arrangements of factors, such as habitat and land cover,
have a direct correlation to the biodiversity of neighboring areas
(Costanza et al., 1997). As pointed out by a recent report by the
National Research Council (NRC; 36), however, valuating ecosystem
services is no easy task. The value of an ecosystem can mean dierent
things to dierent people, disciplines, cultural conceptions, philoso-
phical views, and schools of thought. The Millennium Ecosystems
Assessment (Assessment, 2005) denition of value, utilized in this
study, is commonly used in the valuation of ecosystem services. It is
based on earlier work by Farber et al. (2002) that denes values as The
contribution of an action or object to user-specied goals, objectives, or
conditions.
Ecosystems contribute to human welfare, both directly and indir-
ectly, and represent part of the total economic value of the planet. Yet,
the economic benets of ecosystem services are often not fully
captured in commercial markets (Costanza et al., 1997).
Environmental economics provides mechanisms such as contingent
valuation (Mitchell and Carson, 1989) for measuring ecosystems in
monetary terms. Other common forms of evaluation include adjusted
market prices, productivity methods, and revealed and stated prefer-
ence methods (Fisher et al., 2011). Contingent valuation is used in this
study in addition to comparative home value assessments.
For city governments, planning departments, decision makers, and
stakeholders valuating and accounting for ecosystem services is critical
(Department for Environment, 2007; Howarth and Farber, 2002;
Scarlett and Boyd, 2011). It reects the substantial role of human
wellbeing, quality of life, and the dependencies between humans and
the environment. In the context of policy making and urban develop-
211
Ecosystem Services 23 (2017) 209217
ment, it allows us to make better-informed decisions as to whether or
not modifying a natural ecosystem and/or creating an articial
ecosystem provides the most benets to a community (National
Research Council (NRC), 2012).
According to research by Abbott and Klaiber (2010), large public
spaces provide greater services relative to smaller, more dispersed local
parks. Anderson and West (2006) suggest that homebuyers potentially
oer more money for homes with desirable surroundings, meaning that
property values are impacted by their proximity to open space and
other amenities. This is supported by recent literature that found home
selling prices often directly reect nearby ecosystem assets such as
urban parks, treescapes, and water features (Jim and Chen, 2006;
Tapsuwan et al., 2012). We use this nding to test our study cases.
On average, property values adjacent to open spaces in cities are
approximately 13% higher than similar properties located elsewhere.
The research also suggests that the presence of water confers some
level of intrinsic value irrespective of location. A 1996 study found that
for every percentage point increase in a parcel classied as a wetland,
the average per-acre value increased by 0.3% (Opaluch et al., 1999). A
more recent study suggests built environments containing water were
as preferred as purely green space (White et al., 2010).
Increasing property values from large-scale articially constructed
wetlands are the visible manifestation of tangible, mostly biophilic
benets such as open space, recreation, aesthetics, and habitat
restoration. However, there are also less visible or non-observable
benets to the community resulting from these alternative forms of
green infrastructure. Preferences on perceived attractiveness, willing-
ness to visit, and willingness to pay more for waterfront properties
might explain, in part, the increase in property values in Avondale.
2. Approach and methods
Based on the 1980 Arizona Groundwater Management Act, permits
for land development in large municipalities require a hundred-year
assured water supply. This supply measure is primarily taken from
groundwater and the Central Arizona Project (CAP), a surface canal
originating from the Colorado River and running through Arizona and
Phoenix to augment water supplies. Avondale implemented three
wastewater projects to essentially augment the groundwater aquifer
plus produce design-based community co-benets. Thus, the co-
benets of augmenting groundwater resources for the city include
approvals for urban development, use of CAP water, and natural
treatment of wastewater euent for recharge basins utilizing parks
and constructed wetlands.
In this context, this study focuses on the socioeconomic long-term
eects associated with three residential areas near the projects. Fig. 1
depicts the locations of the three projects and surrounding neighborhoods.
The rst facility studied is Avondale's conventional WTF (Charles M
Wolfe STP in the diagram above) established in the early 1990s. It
provides primary wastewater euent treatment for the city then pipes
the water three miles underground to a recharge facility northwest of
the city's Friendship Park. This facility provides treated wastewater
euent for groundwater augmentation. The major ecological asset is
aquifer recharge.
The second project takes untreated surface water from the Salt
River Project's articial lakes in northwest Avondale (not pictured). It
sends this water through a series of canals to a well abutting Friendship
Park. At night, the water is used to saturate the park, which acts as a
recharge basin for the groundwater aquifer. It also provides urban park
services, including open green space, recreational elds, a small lake,
walkways, and recreational services for the nearby residential areas.
Residential development was a direct result of the park and began after
the park was established. Thus, the study demonstrates that augment-
ing the groundwater aquifer as a primary objective can have enhanced
community-based co-benets resulting in signicant developments, if
planned accordingly.
B. Hagen et al.
Fig. 1. Location of the three urban ecological services projects and the study areas.
The third project transfers primary treated wastewater euent
from sources in Central Phoenix and SRP surface water northeast of
the city to Avondale's Crystal Gardens neighborhoods via the Roosevelt
Canal. Using both gravity and relief avenues, water from these sources
moves southward through a series of 22 articially constructed wetland
lagoons to a recharge basin that supports groundwater augmentation.
The natural ltering process of these ecologically designed lagoons
further decontaminates the water while the green infrastructure
provides signicant landscape and water-based aesthetics for residen-
tial development.
Note that while the rst two sites are interconnected, the third is not
connected to the original wastewater treatment plant. The intent was to
analyze three distinctly dierent approaches in one city, demonstrating the
impacts of dierent urban plans and decisions for treating groundwater.
Using home values, we assessed the impacts of proximity to constructed
ecosystems independent of their relation to each other.
Based on the literature, we hypothesized that the co-benets of
groundwater recharge through wastewater-based developments may
likely include higher than expected property value increases. We argue
that the added value of co-benets such as open space, parks with
water features, and lagoons enhances place-making virtues and aes-
thetics, resulting in a faster rate of property value increases relative to
other areas. These increases in value are not due to the perceived
importance of ecosystem services of groundwater increases, but the
aesthetics of a community designed around water features in a desert
city.
It is important to note that property values used as a surrogate for
the benets of ecosystem services does not, in our case, measure the
values inherent in groundwater augmentation, nearness of buildings to
the infrastructure projects, the economic values in development rights,
212
Ecosystem Services 23 (2017) 209217
or in fact, the amount of property value gain directly resulting from co-
benets such as a park and a landscape of designed residential homes
around the constructed wastewater euent lagoons. We focus on
property values as a response to these functions in terms of enhancing
place and community, contribution to aesthetics, livability, and quality
of life. In contrast to hedonic modeling to explain the importance of
individual variables in home prices, our analyses focuses on comparing
changes in home values between neighborhoods around the three study
sites and various city trends in home values.
Due to the few number of homes in the neighborhood closest to the
original WTF and few historical home sales, it became apparent that
the use of sales data would be highly un-indicative of property value
changes. Therefore, Maricopa County Assessors housing value data
(http://mcassessor.maricopa.gov/) were used for all three cases.
Average Assessed Values can be done on a square footage basis in
addition to factoring out specic house factors. Thus, this analysis
comes close to Hedonic modeling, which was not feasible for this study.
Potential study neighborhoods were rst identied on GIS maps
from the Assessor's oce. The closest neighborhoods with single-
family residential housing were used as the study sites. One hundred
percent of the homes in these neighborhoods were included. The
average total assessed value for these neighborhoods was calculated for
each study year using ArcGIS. Data were then processed in Microsoft
Excel to generate statistical trends and graphics. The city averages
comparison were also received from a separate database maintained by
the County Assessor's Oce for comparison. A total sample of 331
homes were evaluated by assessed valuation on an annual basis from
2002 to 2016 for each of the three projects81 homes in the WTF
neighborhood, 104 around Friendship Park neighborhoods, and 140
homes within the Crystal Gardens lagoon project area.
B. Hagen et al.
3. Analysis and results
3.1. The conventional wastewater treatment plant
For the conventional WTF, the study sought to determine the
extent, longevity and prevalence of adverse and amplied risk percep-
tions. Based on the literature, the facility should have resulted in long-
term diminution and stigma eects on residential properties near the
facility. To determine the magnitude and extent of the socioeconomic
eects of the original siting, we used three methods: 1) Contingent
Valuation (CV) Analysis, 2) trend analysis of property values using
Average Assessed Home Values for all homes in the neighborhoods
closest to the facility, and 3) a public perception survey in these
neighborhoods to understand the home value trends. Finally, we
performed a longitudinal analysis from 2002 to 2016 to validate
existing literature and understand 1) how property values adjacent to
parks and articially constructed wetlands as well as the initial
treatment facility have changed over time, 2) how public attitudes
have evolved towards the local WTF, and 3) how much value local
residents gain from ecosystem services.
There was signicant controversy and public conict over locating
the original WTF when the siting of the facility was in process. The
controversy included community protests, public hearings, and the
emergence of a citizen-based political organization. High-risk percep-
tions, declining property values, and a decrease in home sales were
expected during this period due to risk amplication (Kasperson
et al., 1988). Home value analysis and a contingent valuation survey
showed actual declines in property values of around 15% in the vicinity
of the WTF and anticipated future declines of around 30%. Fig. 2 shows
property values of the residential neighborhoods one to two miles east
of the WTF in comparison to average Phoenix Metropolitan Area
property values from 1988 to 1995.
Property values were measured by average assessed value of
adjacent homes over time. Data show four signicant trends in the
local home market. First, assessed values in the study area were rising
in the area (9%) between 1988 through 1990, prior to the siting of the
industrial treatment plant. Second, with the controversy in full swing
by 1992, home values dropped rapidly by over 15% in comparison to
the greater Phoenix Metropolitan Area. Third, the irregular downward
trend in property values was surprisingly short-lived given what the
literature tells us about the strength and staying power of public risk
perceptions and amplication eects. The trend lasted only four years
with a one-year plateau in 1993. Fourth, home values rebounded by
28.7% in 19941995 and actually surpassed the average assessed home
market values in Metropolitan Phoenix.
Fig. 2. Average home values comparison in the study area and the Phoenix Metropolitan
area.
213
Ecosystem Services 23 (2017) 209217
3.2. Contingent valuation method
Contingent Valuation (CV) uses surveys to evaluate people's will-
ingness to pay or be compensated for some deciency or loss of
amenity connected with an ecosystem or environmental service using a
hypothetical market and market conditions. It has been used exten-
sively to measure the intangible eects on the value of a resource
through people's willingness to pay for goods or services. The premise
is that the value of the good or service can be measured by the
willingness to pay for its value.
CV analysis also provides a measure for valuing environmental
intangibles. A decline in the monetary value of recreation areas, homes,
and land is a reection of a diminution in preferences to visit, pay a
user fee, or purchase because of decreasing value of a place as an
amenity. In this case, it measures loss due to the perceived negative
impactspotential nuisance, health eects and environmental degra-
dationof the proposed WTF.
The CV survey was used to estimate the eects of the proposed
treatment plant on values of adjacent land through public/consumer
willingness to purchase homes at various distances from the facility.
The analysis proposed a scenario where equivalent homes were for sale
with the only dierence being their location/distance relative to the
proposed WTF. The survey showed broad consensus among the
population that residential property values around the facility would
drop and that the public would, as a result, want signicant discount
rates for home purchases by distance from the facility.
Our survey was based on telephone interviews with 380 adult heads
of households residing in Maricopa County, Arizona. To get as realistic
responses as possible, the sample (random digit dialing) consisted of a
rst-time homebuyer subpopulation within the market range for
houses oered in the area near the Avondale WTF. The sampling error
was +/5.2% when the proportion giving a dichotomous response was
0.50 and assuming a 95% condence level.
There were two parts to the survey. The rst asked respondents
about their risk perceptions related to WTFs. The rationale for this was
that the measures or characteristics of WTFs mentioned previously are
based on national and experimental data sources. To avoid survey
biases, this survey aimed to use local data to verify that previous
ndings were applicable to our study area. Our ndings veried that
county residents perceived these facilities as having similar risks to
those identied in national studies. This included perceptions that
WTFs would likely result in a downturn of property values because of
the environmental and land use disamenities associated with the
facility and that the closer one lived to the facility, the higher the
downturn.
In the local survey, approximately 67% of the respondents agreed
and agreed strongly that WTFs create serious odor problems. A
similar percentage agreed or strongly agreed that WTFs lower the
environmental quality of an area. In this survey, the strongest levels of
agreement were associated with a reduction in property values and
level of attractiveness with 76% in agreement. Approximately 85%
agreed that adverse impacts to property values would likely result.
The second part of the study conrmed the theory and existing
literature of diminished values as one moved closer to the facility. The
survey presented dierent purchase preferences of the same hypothe-
tical home at various distances from a WTF that was given similar
technical characteristics to those of the proposed Avondale plant.
Table 1 shows data on behavioral intentions relative to purchasing a
home at three distances from the facility.
At a distance of 0.51.0 miles, just over 21% of the population
would be interested in purchasing a home if a discount was available.
When the home location moves closer to the facility ( < 0.25 and 0.25
0.50 miles), 1415% would be interested in a purchase if the discount
was right. Discount values that would entice investment averaged
between approximately 33% close to and 29% further from the facility.
Not shown in the table are responses from those who would not
B. Hagen et al.
Table 1
Behavioral intentions to purchase under discounted conditions and distance from a WTF.
Miles from Plant
Less than 0.250.5
0.25
Percent of respondents expecting to pay less 93.6 91.2
near a sewage plant
Percent of respondents interested if house 13.7 14.9
was discounted
Mean discount percent on $100,000 house 32.3 31.2
purchase a house within proximity to the facility. At 0.51.0 mile, 61%
of the survey responders would denitely not purchase a house. This
changes to 80% at < 0.25 miles. Finally, only 0.9% stated that a WTF
would not make any dierence in purchasing a home.
3.3. Risk attenuation
By 1995, an interesting and noteworthy change occurs in the
property value trends. The average assessed value of homes in the
study area increases and meets that of the Metropolitan Phoenix area.
The positive trend for home values continues into the 2000s. What
factors explain the transformation from risk amplication to attenua-
tion of the perceived risks?
Explanatory factors include the reduction of the site's visibility
through design of the facility; implementation of state-of-the-art
technologies that mitigate noxious eects; and protection of neighbor-
hood qualities and amenities. This was veried by a randomly selected
satisfaction survey undertaken of neighborhood homeowners. Despite
a relative low response rate of 25%, the data reveal that the primary
explanation of why property values continued to climb for the
residential area closest to the WTF included both the lack of serious
adverse eects from the plant and community satisfaction with the
area.
3.3.1. Lack of serious adverse nuisance eects experienced
Most of the survey responses suggest that the facility was not a
serious source of nuisance eects as was rst thought. Responses show
that 78.9% of neighborhood households did not detect serious odors
from the plant despite the fact that 100% of the sample was aware of
the plant and its vicinity and 73.7% indicated original concerns. Of
those households that did detect odors, 36.8% indicated that they were
not that bad at all. The threat to health was a major concern at the
time of the siting as well. However, the percentage of surveyed
households who thought there was no threat to health was large
(63.01%). Thus, the nuisance eects that originally drove home values
down did not materialize with the operation of the facility.
3.3.2. Satisfaction with the local community
Another factor in risk attenuation is the high level of satisfaction
that residents reported, as indicated by responses to a quality of life
aggregate question. Residents were asked if they were not satised,
somewhat satised, satised, or very satised with living in the
neighborhood. One hundred percent of the residential neighborhood
nearest the facility responded that they were satised living in the
community with 47.4% of those being very satised. In other words,
satisfaction in living in the area was quite high despite the industrial
WTF nearby.
Respondents perception of environmental quality in the neighbor-
hood was rated as very good overall in spite of universal awareness of
the WTF. On a scale of 110 where 1 is poor and 10 is excellent,
68.5% of households indicated a high rating of 710 and another
26.3% indicated a moderate 56 rating. Only 5.2% of responses stated
neighborhood environmental quality as poor with a score of 3 or less.
Respondents were also asked whether the overall environmental
Ecosystem Services 23 (2017) 209217
quality deteriorated, remained the same, or improved for both the
neighborhood and the metropolitan area. Results show signicantly
fewer declines in environmental quality in the neighborhood than in
the region. The survey results validated that the decreased public
0.51.0 concern into the 2000s resulted from a combination of satisfaction with
living in the area, non-discernable nuisance eects, and a positive local
environmental quality.
89.4
Our study results also found that despite minor property value
21.4 decreases in the short-term during the siting process, property values
increased signicantly in part due to the investment in alternative
28.7 state-of-the-art technologies at the facility that reduced or eliminated
nuisance eects. Property values not only bounced back to selling
prices for Metropolitan Phoenix after a four-year period but they
actually surpassed regional property values. Finally, we found that
using a CV approach at the county level reinforced the national data on
perceived risks and declines in home values but only in the short term.
Given these results, we conclude that the WTF did not result in
continued risk amplication eects over time despite the original
concerns over serious degradation of the area's ecosystem services.
3.4. Long-term benets from the three projects
Analyses were completed on home value trends from 2002 to 2015
for three housing developments:
1) Established single-family homes situated about 1 mile from the
original WTF,
2) Homes built in the Friendship Park area, and
3) Homes constructed around each of the articial 22 wetland lagoons
in an area called Crystal City.
3.4.1. Original treatment facility
Fig. 3 shows the average assessed single-family home values for the
residential areas closest to the original WTF (STP in the original survey
as indicated in the gure). From 20022008, we observe a steady
increase in home values at around 65.4% over the six-year period.
From the beginning of the recession in 2008 to 2011, home value trend
decreases are similar between Avondale overall and the Phoenix Metro
area in percent with both showing a downswing of almost 33%.
However, home values in the study neighborhood showed remarkable
resiliency in comparison with a decrease of around 23% despite
proximity to the WTF.
Despite the continuance of primary treatment at the plant, property
values are shown to move upward due in part to the lack of experience
with nuisance eects as indicated in the survey. They may also result
from transferring the wastewater away from the neighborhood under-
ground rather than openly dumping it into the Agua Fria River as was
originally done. Certainly, square foot values of home in close
proximity to the plant are lower than both Avondale as a whole and
the city of Phoenix. This is not, however, due to the siting of the WTF
but rather that these neighborhoods are historically blue-collar with
lower median income levels.
3.4.2. Ecosystem valuation for friendship park
Prior to August 2011, the treated grade B water from the conven-
tional WTF was discharged into the Agua Fria River west of the plant.
Changes in government regulation at this time mandated that Avondale
would only have rights to 50% of the groundwater if the plant were to
continue discharging recycled water into the river. Avondale's remain-
ing water needs would have to be paid for. Thus, it was more nancially
viable to develop a new recharge facility, which would give the city the
right to withdraw water from the aquifer in amounts equal to the
treatment plant's output.
Friendship Park was developed in 2004 as a local recreation facility
three miles from the existing plant. Immediately after development,
nearby neighborhoods saw a property value increase from $61.44 to
214
B. Hagen et al.
Fig. 3. Single Family Home Valuation near Avondale WTF/STP compared to Phoenix.
Fig. 4. Property valuation within a 2-mile radius of Friendship Park.
$70.44 per foot of assessed value. Since there were no other major
development events, we can directly attribute this increase to
Friendship Park. In 2007, the Park was retrotted to support recharge
activities during non-use hours. These changes resulted in an increase
to $93.44 per square foot of assessed value. During this same period,
the city's property values as a whole were declining, making the
argument stronger that the increased property value was directly
related to the recreational co-benets as well as groundwater recharge
services. Fig. 4 shows the average annual assessed home values for the
residential area around Friendship Park.
3.4.3. Lagoon homes property values
As mentioned earlier, wastewater euent is transported from
Central Phoenix through a cross-city canal (Roosevelt Canal) to supply
water to 22 articial, connected wetland lagoons in the Crystal City
neighborhood. Both primary and tertiary treated water enters the
lagoon system. This euent exits the canal in Avondale and ows south
through the lagoons into a recharge aquifer at its most southerly point.
The homes built around these lagoons are adjacent to open-space,
pedestrian and bicycle pathways, and recreation areas. Fig. 5 shows the
trends in average assessed value for these homes and compares them to
the broader Avondale and Phoenix Metropolitan Areas.
Between 2002 and 2008, the assessed average home values
increased from $168,423 to $284,532, an increase of 68.9% over this
six-year period. This percent increase stands in contrast to average
215
Ecosystem Services 23 (2017) 209217
assessed values for both Avondale and Phoenix that showed declines of
around 16% for the same period. The Maricopa County Assessor's data
shows a nominal decline in property values for the study area in
comparison to the rest of the city during the national recession from
2008 to 2012. Specically, the home value drop in assessed value was
found to be around 24%, while the two cities overall dropped by about
32%. The post-recession period from 2011 to 2015 saw an increase of
growth around 41% in contrast to 5559% for the two cities overall.
The smaller increase in growth is likely due, in part, to the stability in
the area's housing prices over the long term as well as the substantially
higher home price average overall.
4. Discussion and conclusion
As we have seen, the siting and building of a WTF had the expected
initial responses from its neighbors, i.e. high levels of risk perceptions
in regards to nuisance eects, toxic releases, diminishment of environ-
mental conditions, and declines in property values. A Contingent
Valuation analysis done at the time reinforced the concept of risk
amplication as the hypothetical homebuyers surveyed expressed
concerns regarding living close to a WTF and requiring signicant
discount rates in purchasing a home close to such a plant. Surprisingly,
the single-family homes near the WTF steadily increased in value after
operations began and surpassed the Phoenix Metropolitan average
after ve years.
In line with the increased home values, the neighborhoods around
the facility demonstrated what Kasperson et al. (1988; 27) coined as
risk attenuation or a reduction in the perception of the severity of or
potential for risks. This was an unexpected outcome given that the CV
analysis showed large discount rates of purchasing a home within one
mile of a WTF initially. Of course, the CV analysis is based on a given
hypothetical facility at one point in time. While rarely used in
explaining attenuation, the Quality of Life survey explained property
value upswings.
Our study found that constructed wetlands for treating wastewater
euent resulted in substantial community benets. In the two alter-
native WTF cases over time, similar patterns of results are seen in
property value trends of residential developments in the vicinity of
these two features. Looking at these trends enables us to understand
the continuous benets from green wastewater infrastructuregreen
space, aesthetics, sense of community, and other quality of life factors.
B. Hagen et al.
Fig. 5. Lagoon home property valuations compared to Phoenix and Avondale.
It validates our hypothesis that the park-like and water-based features
oered by alternative WTFs attract people to them, create a sense of
place, and increase property values beyond typical home values in
desert cities.
Triangulating three cases to study the magnitude, direction, and
longevity of eects against trends at the larger city scale validates our
hypotheses that the public in desert cities accepts ecologically designed
WTFs. Our study also demonstrates the methodological strengths of
longitudinal analysis, the use of a multiple methods approach, and
triangulated site studies for ecosystem service valuation. It shows that
longitudinal analysis plays an important part in furthering the under-
standing of human-ecological interaction particularly in the area of risk
perception.
Longitudinal data demonstrates the property value dierences
between two types of man-made ecosystem servicesthose in which
homes are integrated into a wetland ecosystem design (Crystal
Gardens) and homes concentrated around a recharge green space
(Friendship Park). In the integrated system, wastewater euent from a
Central Phoenix plant ows through 22 articially designed wastewater
ponds designed with homes on the peripheries. The percent increase in
assessed value of these homes over time surpasses the property value
percentage increases around Friendship Park.
Friendship Park is a multi-faceted recharge basin and recreational
center. It oers ecosystem assets including groundwater augmentation
and associated economic benets with respect to purchasing water and
meeting the threshold for an assured water supply for development
rights in the city. The park also attracts new residential development as
it adds to the appeal of the area via recreational activities and a sense of
community. The study found that property values around the park
increased when compared to the city as a whole. Importantly, these
property values showed lower downturns during the national recession
as well.
In all three cases, the results show signicant social acceptance of
these projects, expressed in one common socioeconomic measure the
stability and increase of monetary home values that meet or even
surpass traditional home value trends. Additionally, property values
show increases and resiliency during economic downturns that are
often larger than the city averages during periods of growth. Proximity
to views of water and parks, especially in desert cities, were also shown
to add substantial value to homes as earlier literature suggested.
Certainly, each of the benets identied above can be calculated in
terms of economic revenues for the city as well, including making land
available for urban development and increasing tax bases.
216
Ecosystem Services 23 (2017) 209217
Funding
The law rm of Dusho and McCall, located in Phoenix, funded the
initial Contingent Valuation surveys and analysis for this work.
Acknowledgements
We thank the City of Avondale Water Department for the numerous
interviews they gave members of the team over the years; Dr. John
Blair for conducting the neighborhood WTF satisfaction survey; L.
Sharma for bringing together some of the risk perception literature;
and Michele Roy for editing the paper which spans various research
eorts on the topic over a 20-year period. The City of Avondale also
made available the reports on citizen hearings and meetings on the
proposed treatment plant.
References
Abbott, J.K., Klaiber, H.A., 2010. Is all space created equal? Uncovering the relationship
between competing land uses in subdivisions. Ecol. Econ. 70 (2), 296307. http://
dx.doi.org/10.1016/j.ecolecon.2010.09.001.
Abbot, J.K., Klaiber, H.A., Smith, V.K., 2015. Economic Behavior, market signals, and
urban ecology, NBER Working Paper Series. Working Paper 20959.
Anderson, S.T., West, S.E., 2006. Open space, residential property values, and spatial
context. Reg. Sci. Urban Econ. 36 (6), 773789. http://dx.doi.org/10.1016/
j.regsciurbeco.2006.03.007.
Assessment, M.E., 2005. Ecosystems and human well-being: a framework for
assessment, Washington D.C.
Beatley, T., 2011. Biophilic Cities: Integrating Nature into Urban Design and Planning.
Island Press, Washington, D.C..
Bell, R., 2008. Contaminated waterways and property valuation. Apprais. J. 76 (4),
344354.
Benford, R.D., Moore, H.A., Williams, A., Jr., 1993. In whose backyard ? Concern about
siting a nuclear waste facility. Sociol. Inq. 63 (1), 3048. http://dx.doi.org/10.1111/
j.1475-682X.1993.tb00200.x.
Bolund, P., Hunhammer, S., 1999. Ecosystem services in urban areas. Ecol. Econ. 29 (2),
293301. http://dx.doi.org/10.1016/j.cosust.2015.05.001.
Boyer, T., Polasky, S., 2004. Valuing urban wetlands: a review of non-market valuation
studies. Wetlands 24 (4), 744755. http://dx.doi.org/10.1672/0277-5212(2004)
024[0744:VUWARO]2.0.CO;2.
Bullock, J.M., Aronson, J., Newton, A.C., Pywell, R.F., Rey-Benayas, J.M., 2011.
Restoration of ecosystem services and biodiversity: conicts and opportunities.
Trends Ecol. Evol. 26 (10), 541549. http://dx.doi.org/10.1016/j.tree.2011.06.011.
Cook, E., 2015. Urban ecology, green networks and ecological design. In: Pijawka, D.
(Ed.), Sustainability in the 21st Century: Pathways, Programs, and Policies. Kendall
Hunt Publishing Company, Dubuque, IA, 111136.
Costanza, R., dArge, R., De Groot, R., Farber, S., Grasso, M., Hannon, B., van den Belt,
M., 1997. The value of the world's ecosystem services and natural capital. Nature
387, 253260. http://dx.doi.org/10.1038/387253a0.
Department for Environment, Food and Rural Aairs [DEFRA], U.K. 2007. An
B. Hagen et al.
introductory guide to valuing ecosystem services.
De Jong, J., 1976. The purication of wastewater with the aid of rush or reed ponds. In:
Tourbier, J., Pierson, R.W. (Eds.), Biological Control of Water Pollution. University
of Pennsylvania Press, 133139.
de Wit, M., van Zyl, H., Crookes, D., Blignaut, J., Jayiya, T., Goiset, V., Mahumani, B.,
2012. Including the economic value of well-functioning urban ecosystems in
nancial decisions: evidence from a process in Cape Town. Ecosyst. Serv. 2, 3844.
http://dx.doi.org/10.1016/j.ecoser.2012.08.002.
Ecological Society of America (ESA), 2012. Ecosystem Services Fact Sheet.
Ewel, K.C., Odum, H.T., 1986. Cypress Swamps. University Presses of Florida.
Farber, S.C., Costanza, R., Wilson, M.A., 2002. Economic and ecological concepts for
valuing ecosystem services. Ecol. Econ. 41 (3), 375392. http://dx.doi.org/10.1016/
S0921-8009(02)00088-5.
Fisher, B., Bateman, I., Turner, R. K., 2011. Valuing Ecosystem Services: Benets,
Values, Space and Time. doi: 10.4324/9780203847602
Fitchen, J.M., 1991. Endangered Spaces, Enduring Places: Change, Identity, and Survival
in Rural America. Westview Press, Inc..
Gawande, K., Jenkins-Smith, H., 2001. Nuclear waste transport and residential property
values: estimation the eects of perceived risks. J. Environ. Econ. Manag. 42 (2),
207233. http://dx.doi.org/10.1006/jeem.2000.1155.
Gmez-Baggethun, E., Barton, D.N., 2013. Classifying and valuing ecosystem services for
urban planning. Ecol. Econ. 86, 235245. http://dx.doi.org/10.1016/
j.ecolecon.2012.08.019.
Howarth, R.B., Farber, S., 2002. Accounting for the value of ecosystem services. Ecol.
Econ. 41 (3), 421429. http://dx.doi.org/10.1016/S0921-8009(02)00091-5.
Ignatieva, M., Stewart, G.H., Meurk, C., 2011. Planning and design of ecological networks
in urban areas. Landsc. Ecol. Eng. 7 (1), 1725. http://dx.doi.org/10.1007/s11355-
010-0143-y.
Jim, C.Y., Chen, W.Y., 2006. Impacts of urban environmental elements on residential
housing prices in Guangzhou (China). Landsc. Urban Plan. 78 (4), 422434. http://
dx.doi.org/10.1016/j.landurbplan.2005.12.003.
Kadlec, R.H., Tilton, D.L., Ewel, K.C., 1979. The use of freshwater wetlands as a tertiary
wastewater treatment alternative. Crit. Rev. Environ. Sci. Technol. 9 (2), 185212.
http://dx.doi.org/10.1080/10643387909381671.
Kasperson, R.E., Renn, O., Slovic, P., Brown, H.S., Emel, J., Goble, R., Ratick, S., 1988.
The social amplication of risk: a conceptual framework. Risk Anal. 8 (2), 177187.
http://dx.doi.org/10.1111/j.1539-6924.1988.tb01168.x.
Kickuth, R., 1977. Degradation and incorporation of nutrients from rural wastewater by
plant hydrosphere under limnic conditions. Util. Manure Land Spread., 235243.
Klaiber, A.H., Smith, K.V., 2013. Quasi experiments, hedonic models, and estimating
trade-os for local Amenities. Land Econ. 89 (3), 413431.
Kowarik, I., 2011. Novel urban ecosystems, biodiversity, and conservation. Environ.
Pollut. 159 (8), 19741983. http://dx.doi.org/10.1016/j.envpol.2011.02.022.
Lancaster, K.J., 1966. A new approach to consumer theory. J. Political Econ., 132157 ,
(Stable URL)http://www.jstor.org/stable/1828835.
Larson, K.L., Nelson, K.C., Samples, S.R., Hall, S.J., Bettez, N., Cavender-Bares, J.,
Learned, J., 2016. Ecosystem services in managing residential landscapes: priorities,
value dimensions, and cross-regional patterns. Urban Ecosyst. 19 (1), 95113.
http://dx.doi.org/10.1007/s11252-015-0477-1.
217
Ecosystem Services 23 (2017) 209217
Lee, A.C., Mahewaran, R., 2011. The health benets of urban green spaces: a review of
the evidence. J. Public Health 33 (2), 212222. http://dx.doi.org/10.1093/pubmed/
fdq068.
Mitchell, R.C., Carson, R.T., 1989. Using surveys to value public goods: the contingent
valuation method. Resour. Future.
Mooney, H.A., Postel, S., Schneider, S.H., Tilman, D., Woodwell, G.M., 1997. Ecosystem
services: benets supplied to human societies by natural ecosystems. Issues Ecol., 2.
National Research Council (NRC), 2012. Ecosystem Services: Charting a Path to
Sustainability. The National Academies Press, Washington, DC. http://dx.doi.org/
10.17226/13331.
Nieves, L.A., 1993. Economic impacts of noxious facilities: incorporating the eects of risk
aversion. Risk 4, 35 http://digital.library.unt.edu/ark:/67531/metadc618918/.
Odum, H.T., Ewel, K.C., Mitsch, W.J., Ordway, J.W., 1977. Recycling treated sewage
through cypress wetlands in Florida. Wastewater Renov. Reuse, 3567.
Opaluch, J.J., Grigalunas, T., Diamantides, J., Mazzotta, M., Johnston, R., 1999.
Recreational and resource economic values for the peconic estuary system. In: Final
report prepared for the Peconic Estuary Program. Economic Analysis, Inc. Peacedale,
Rhode Island
Polyakov, M., Pannell, D.J., Pandit, R., Tapsuwan, S., Park, G., 2013. Valuing
environmental assets on rural lifestyle properties. Agric. Resour. Econ. Rev. 42 (1),
159175.
Renn, O., Burns, W.J., Kasperson, J.X., Kasperson, R.E., Slovic, P., 1992. The social
amplication of risk: theoretical foundations and empirical applications. J. Soc.
Issues 48 (4), 137160. http://dx.doi.org/10.1111/j.1540-4560.1992.tb01949.x.
Rosen, S., 1974. Hedonic prices and implicit markets: product dierentiation in pure
competition. J. Political Econ. 82 (1), 3455 , (Stable URL)http://www.jstor.org/
stable/1830899.
Scarlett, L., Boyd, J., 2011. Ecosystem services: quantication, policy applications, and
current federal capabilities. Resources Future Discuss. Pap., 1113.
Seidel, K., 1976. Macrophytes and Water Purication. In: Tourbier J., Pierson, R.W. (eds.)
Biological Control of Water Pollution, 109222.
Tapsuwan, S., MacDonald, D.H., King, D., Poudyal, N., 2012. A combined site proximity
and recreation index approach to value natural amenities: an example from a natural
resource management region of Murray-Darling Basin. J. Environ. Manag. 94 (1),
6977. http://dx.doi.org/10.1016/j.jenvman.2011.07.003.
Vymazal, J., 2010a. Constructed wetlands for wastewater treatment: ve decades of
experience. Environ. Sci. Technol. 45 (1), 6169. http://dx.doi.org/10.1021/
es101403q.
Vymazal, J., 2010b. Constructed wetlands for wastewater treatment. Water 2 (3),
530549. http://dx.doi.org/10.3390/w2030530.
White, M., Smith, A., Humphryes, K., Pahl, S., Snelling, D., Depledge, M., 2010. Blue
space: the importance of water for preference, aect, and restrictiveness ratings of
natural and built scenes. J. Environ. Psychol. 30 (4), 482493.
Zeiss, C., Atwater, J., 1989. Waste facility impacts on residential property values. J.
Urban Plan. Dev. 115 (2), 6480. http://dx.doi.org/10.1061/(ASCE)0733-
9488(1989)115:2(64).
Zhang, Y., Hwang, S.N., Lindell, M.K., 2010. Hazard proximity or risk perception?
Evaluating eects of natural and technological hazards on housing values. Environ.
Behav. 42 (5), 597624. http://dx.doi.org/10.1177/0013916509334564.