This week, host Daniel Raimi talks with Megan Mullin, an associate professor of environmental politics at Duke University’s Nicholas School of the Environment. Mullin talks about her research, which analyzes how communities pay to rehabilitate beaches affected by erosion and how differential tax rates can affect levels of support for these beach nourishment projects. Mullin also makes clear why coastal management is relevant: as climate change accelerates the erosion of beaches, and as federal funding dries up, local communities will increasingly have to grapple with how to pay to replenish their shorelines.
Listen to the Podcast
- Preparing waterfront property for climate change: “Beach nourishment is quite simply the import of sand from some other location, typically offshore, to rebuild an eroded beach. It’s an old practice. The first major project in the United States was almost a hundred years ago, but it’s increasing with time, as sea level rise and more frequent and more severe coastal storms are amplifying erosion patterns at the shore.” (4:29)
- Potential for differential tax rates: “[Governments] want to provide public goods, but taxpayers often don’t want to pay for those public goods. And so they’re using these instruments, which [include] this differential property tax rate … They create these special taxing districts and define a set of properties that will differentially enjoy benefits from the project and tax those properties at a rate as much as 10 or 15 times the citywide tax rate.” (10:15)
- Why the public supports beach nourishment: “We can’t discount the importance of the immediate return in beach nourishment. There is this amenity value that exists in this policy space where you widen the beach, and it’s lovely. You can go fly a kite, you can take long walks on the beach, you get this scenic value and an immediate boost in your tourism revenue. Not all adaptation strategies are going to have that kind of immediate return.” (24:35)
Top of the Stack
- "Paying to save the beach: effects of local finance decisions on coastal management" by Megan Mullin, Martin D. Smith, and Dylan E. McNamara
- The Conversation: "Where does beach sand come from?"
- The Dark Crystal: Age of Resistance
The Full Transcript
Daniel Raimi: Hello and welcome to Resources Radio, a weekly podcast from Resources for the Future. I'm your host, Daniel Raimi. This week we talk with Dr. Megan Mullin, Associate Professor of Environmental Politics at Duke University's Nicholas School of the Environment. I'll talk with Megan about her work on beaches. In particular—how do communities pay for building up beaches that are affected by erosion, and how do different tax rates affect the preferences of people to support those projects. We'll talk about how these policies are playing out today and what they might mean for the future in the context of a changing climate and rising sea levels. Stay with us.
Okay, Megan Mullin from Duke University. Thank you so much for joining us today on Resources Radio.
Megan Mullin: Thank you.
Daniel Raimi: So Megan, we're going to talk today about some work that you've done on coastal land use and particularly around this issue called beach nourishment. But before we get into that, can you briefly tell us why or how you got interested in environmental issues and maybe coastal issues in particular?
Megan Mullin: This is a hard question to answer because there's really nothing in my family or background that would have led me to working on the environment. So, in thinking about this, I first remember thinking about the environment at the counter of a Dunkin Donuts.
Daniel Raimi: Nice.
Megan Mullin: Because I worked long hours at Dunkin Donuts from when I was 14 to 18 and during the slow shifts I would read the newspaper from front to back. And when I look back—you know, this was the time of Exxon Valdez, when James Hanson was drawing the nation's attention to greenhouse warming, to when President Bush campaigned to be the environmental president—
Daniel Raimi: Right.
Megan Mullin: And then came into office and tackled the problem of acid rain. And so it's really interesting. I somehow became convinced that environmental problems were the problems that I cared about the most, and that politics could offer a solution. And it's been sort of a meandering road since then, but I think I've followed that track, right. That interest in environment and politics ever since.
Daniel Raimi: That's fascinating. And yeah, I mean, I wonder how many other people can credit Dunkin Donuts for for getting into this field.
Megan Mullin: The glories of the teenage job.
Daniel Raimi: Yeah, totally. So as I mentioned a moment ago, we're going to talk about an article that you published in 2018, the article is published with colleagues and it's called “Paying to Save the Beach, Effects of Local Finance Decisions on Coastal Management.” And it's in the journal Climatic Change. We'll have a link to it people can find it. So the work focuses on, in my reading, how different members of coastal communities might feel about efforts to protect the shoreline, specifically through this thing called beach nourishment. So can you briefly get us started by telling us about how this particular research project came about, and then maybe give us a little background on what beach nourishment is.
Megan Mullin: I joined a team that had already been working in this space of coastal management, and it's a team of coastal scientists and economists, and they were looking at this coupled natural and human system that governs coastline change. The ways that decisionmaking about coastal management has impacts on wave activity and erosion patterns and the shape of the coastline that emerges over time. And then how those physical changes feed back into human decisionmaking. But the ways they had been thinking about human decisionmaking were all sort of the individual decisions of property owners at the coast. And they knew that a lot of these coastal management decisions were in fact collective decisions.
And I'm a political scientist who does a lot of work on local politics, and so they invited me to join the team and think about how these individual preferences kind of aggregate into collective decisions. And so the interest here is on beach nourishment, which is quite simply the import of sand from some other location, typically offshore, to rebuild an eroded beach. And so it's an old practice. The first major project in the United States was almost a hundred years ago, but it's increasing with time, right? As sea level rise and more frequent and more severe coastal storms are sort of amplifying erosion patterns at the shore.
Daniel Raimi: Right. Great, that makes sense. And when I think of beach nourishment, I remember a trip I made to the North Carolina coast like 15 years ago, and there was this offshore dredging boat that was literally digging up sand from 20 yards off shore and shooting it into the air and then over onto the beach. But there a variety of sort of technologies that that one might use to do beach nourishment, right?
Megan Mullin: That's right, yeah. There are a variety of different technologies. Usually it's coming from offshore, and—outside the scope of this paper, but part of this sort of larger project is exploring some of the dynamics about the actual sand supply. Because now as more communities are engaging in beach nourishment and more frequently, there's a race to the sand, right? Higher value and lower value sand. And there's a lot of interesting dynamics around that process too.
Daniel Raimi: Yeah, for sure. So thinking back to this issue of beach nourishment and communities, can you tell us about who usually pays for these types of projects? Is it the federal government, state government, locals? Is it private, individuals or companies. And why might different members of any given community sort of have different views on the value of doing different levels of beach nourishment?
Megan Mullin: Historically, nourishment projects in the United States have been funded and executed primarily by the federal government, by the Army Corps of Engineers, with states and localities contributing a share of the projects’ costs. But federal funding has declined in recent years, and many communities that had commitments from the federal government aren't seeing the money flow. And more communities are confronting beach erosion—many of these communities are now choosing to fund nourishment projects on their own. And these are really major investments in what are often pretty small towns. And so we can think about nourishment projects offering kind of public and private benefits, right? So there's a community wide amenity value for a beach nourishment project. It offers recreational benefits, it offers coastal views that are enjoyed by residents—and also these amenity values boost the tourism industry, which is, in many communities along the coast, an important economic engine for the town and again has the sort of community wide benefits.
But some community members benefit more from these projects than others do because the projects also offer defensive benefits. They help properties defend against strong waves and storm surge. And so those with ocean front homes that are most susceptible to storm damage, and those who kind of care the most about the views and recreation, which are mostly going to be people in those ocean front homes. Those are the people who benefit the most from these projects. So there's this sort of combined public and private good that the nourishment projects offer. And what we're seeing is that in many communities, they're using local finance instruments that actually capitalize on that combined public and private good.
Daniel Raimi: Right. And that's kind of one of the big mechanisms that you focus on in this paper is sort of differential property tax rates between individuals who may live on the coast and then individuals who live inland or further from the beach itself. I would imagine that beach front property owners are probably not all that enthusiastic about the idea of paying higher property taxes than others who live in the community. So are there, in the places where these policies have been proposed or enacted, do you see sort of political impediments to imposing them and kind of making them work on the ground?
Megan Mullin: We do, although in some sense, right, that the instrument actually helps solve a problem for local political decisionmakers, right? So again, I come at this as a political scientist, and I really became interested in this work once I learned about this tax instrument because from a politics point of view, it's brilliant, right? It helps overcome this challenge that that local decisionmakers often have where they want to provide public goods because that helps the community perform well in it's competition with its neighbors, right? So if we're thinking about tourist towns on the North Carolina coast, they're competing with one another for tourist activity.
And so they want to provide public goods, but taxpayers often don't want to pay for those public goods. And so they're using these instruments, which have this differential property tax rate. So they pay for part of the project with a citywide property tax increment, and then they define properties. They create these special taxing districts and define a set of properties that will differentially enjoy benefits from the project and tax those properties at a rate as much as 10 or 15 times the citywide tax rate.
Daniel Raimi: Wow.
Megan Mullin: And so that's fascinating, right? And it solves this political problem, but of course, as you say, it can create opposition from those who are being taxed at a very high rate. And it's interesting, looking at the cases, it's often the oceanfront owners who are advocating most strongly for nourishment. They are the ones who will enjoy the kind of defensive benefits, the private goods from those nourishment projects. But of course, ideally they want to absorb as little cost of the project as possible.
So in the paper, what we're doing is we're modeling how different tax ratios would benefit different community members based on their ability to capitalize that cost of the project into their home values. And so we're modeling that out for property owners—both who are at the oceanfront, would pay higher rates under a differential tax structure, but also enjoy higher benefits from the project. What their voting behavior might be under different conditions, and then what the voting behavior might be for the inland property owners who are paying lower rates and enjoying fewer benefits from the project.
Daniel Raimi: Right. And one of the findings in the paper, if I was reading things correctly, and please do correct me if I misunderstood this, but as tax rates go up for beachfront property owners relative to others in the community, they tend to become less supportive of larger beach nourishment projects. While those who live inland become more supportive. And that's fairly intuitive I think, judging from the background that you've given us. But can you kind of walk us through what you see as some of the most important implications of that fairly intuitive finding?
Megan Mullin: Sure. I'd say the most important implication is what I started with, right? This kind of mixed tax instrument creates a possibility for funding beach nourishment projects, but also a variety of different types of public projects that offer this mix—this mix of broad public benefits, but also heterogeneous benefits where some property owners are going to benefit more than others. And this idea of this kind of tax instrument has appeared elsewhere in the literature. Sometimes people call it a value capture concept. I think a really important implication is that this does offer some possibility of providing higher levels of public goods than you might get with sort of a strict flat tax, and sort of a citywide vote, if that's your decision mechanism. But there are limits on how disproportionate the funding can be.
So we show that if you're modeling this decisionmaking mechanism through sort of a strict majority vote, the inland property owners are, at very high tax ratios, they're taking advantage of the possibility of oceanfront owners paying more for this project, and they're taking advantage of that to provide higher levels of the good than the oceanfront owners might prefer. Whereas at tax ratios that are more even, the oceanfront owners who enjoy more benefit take advantage, right, of that benefit to provide higher levels of good. So, it creates a possibility for more funding, but there are limits on how disproportionate the funding can be. Because once you keep sort of taxing those oceanfront owners at very high rates, there's the possibility for feedbacks, where ultimately those properties can no longer capitalize those values going out into the future.
I'd say another important implication just to follow up is that there's an equity or a fairness implication here too. We're showing here how these heterogeneous benefits can be leveraged to build majority support to fund a project. But part of this—critical to the setup that we have here is, those who benefit most are owners of the highest value properties. So if we think about sort of exporting this concept to other types of goods, it would be a problem if those who enjoyed the disproportionate benefits were less wealthy than the average resident.
Daniel Raimi: Right. Yeah, that makes a lot of sense. And I guess as you were talking, I was wondering about applying this principle to other areas where there are sort of large differential risks and benefits that community members might bear. I was thinking about wildfire-prone areas in California or places with scenic views in the woods or something like that. Have you thought much about applying this concept in other domains outside of coastal contacts?
Megan Mullin: I think the examples that you just drew on are good ones, because you do get this same distribution really where those who might benefit most from the project are the higher value properties. Other settings, I think where you're situated more in urban settings and you're thinking about transit stations, or schools policies, or parks; you might get, again, kind of some of these equity questions becoming more forefront. So yes, I've thought about it. I haven't done any modeling, but I think that it does, it sort of opens up a set of issues we should be thinking about with respect to climate adaptation, which is that adaptation goods are very often these kinds of bundles that offer private benefits and public benefits.
And so in a different paper, some coauthors and I are sort of piecing apart these good attributes in different sorts of coastal management adaptation policies. Protection, avoidance, retreat, and thinking about issues like the heterogeneity of benefits, the capital intensivity of these different policies, in order to identify finance strategies that might be applicable and might be able to leverage some of these private benefits.
Daniel Raimi: Yeah, that sounds super interesting. So, okay—I'm going to take us back to the beach now. One of the distinctions you make in the paper is between different communities that you refer to as thick and thin beach communities. Can you tell us, what is the distinction between thick and thin beach communities, and why that might matter for this types of decision making on tax policy?
Megan Mullin: Sure. We're modeling this with sort of empirical foundations based on research carried out by our team, but it's not situated in any particular empirical setting. It is, however, informed by our work out on the Outer Banks of North Carolina, and our idea in mind is these kinds of coastal barrier islands. And so if you think about this kind of tax structure, it's really all about that mix of those who enjoy the concentrated benefit and those who only enjoy the sort of dispersed broader benefit. And so thick and thin beach communities means, what are the relative proportions of oceanfront owners who are enjoying this concentrated benefit? Because this set up spreads some fixed project costs across these different groups of homeowners. And so if you have a thin beach community, you have more oceanfront owners as a proportion of the overall tax base.
If you have a thick community, you have a small proportion of oceanfront owners that might be bearing a very high cost for that project. And the political implications in the modeling are that these are two different groups, depending on the tax ratio—one's trying to sort of shift the burden of the project onto the other group. And it's in the thin communities where the groups are more equal in size, where you get more opportunity for preference mixing, for preferences to overlap with one another. And for political coalition-building that might allow the development of solutions that aren't just good for one group versus the other, but might allow sort of maximizing benefits to both groups.
Daniel Raimi: Great. That makes sense. And if people are trying to visualize these types of communities, there are a couple images in the paper that are really helpful. One of them is a thin community where it's basically just one road going down this barrier island and so half of the people who live in the community are beachfront property owners and the others are quite close by. And then there's a thick community where there are multiple blocks in this barrier island. And so you can see that there's a very different distribution of who would be benefiting in different ways from these types of projects.
Thinking about the longer term implications of this work in a climate change context, you've already mentioned a couple of them. But one question that comes to mind for me is as climate change leads to higher sea levels and more severe storms, do you have any concerns about these types of property tax instruments being like a one way ratchet? So one could imagine them going higher and higher as there's more and more need for beach renourishment or nourishment in these communities. And at a certain point, one would think that if the tax rates get high enough, then it's going to deter people from buying property in these areas, which could have maybe the opposite effect of what communities are going for in terms of economic development. So how do you think about the sort of changes over time in a changing climate?
Megan Mullin: I think that you're reading it the same way I do. These property owners are sort of, in our model, continually trading off the value form more beach width with the costs for maintaining that width. But we're not incorporating, at this stage, the real estate market response. If inland owners keep widening beaches at the expense of these oceanfront owners, then the market for oceanfront properties is going to dry up. And then you no longer have that tax base to exploit for these kinds of projects. And of course, any single major storm that comes in, that may wipe out some chunk of these oceanfront properties will also damage that tax base. So this seems like a strategy that has limits, time-horizon limits on how long it can be sustained.
Daniel Raimi: Yeah. And that leads into the other question I was going to ask, which is on a related note; you and your coauthors in the paper note that beach nourishment probably is not a viable longterm strategy for all of the coastal communities that will be affected by a changing climate and changing sea levels and storms. Particularly if we think towards the end of the 21st century and beyond as sea level rises one foot, two feet or more. But are there any applications that you can draw out from this work about the willingness of coastal communities writ large to pay for climate adaptation efforts? Whether they are protection or avoidance or retreat or anything else?
Megan Mullin: I think it's right—I mean, these communities are trying to sustain themselves right now, and this is a strategy they're using. As I said, I find it sort of a really politically interesting strategy that they're using, but there are limits in a whole variety of ways. The paper is part of this larger project, and in that larger project we're thinking about a lot of the different feedbacks that are at play in coastal management. So nourishment in any one town is part of a larger system. There are externalities from one community nourishing its beaches for erosion patterns down shore. There are raises for sand, as I mentioned. There's the fact that you can actually accelerate erosion by doing nourishment in some cases, and so it's really this sustaining pattern right now that's going to have limits and then we'll have these sharp interventions from major storms.
So, in thinking about this, we can't discount the importance of the immediate return in beach nourishment. There is this amenity value that exists in this policy space, where you widen the beach and it's lovely. You can go fly a kite, you can take long walks on the beach, you get this scenic value and an immediate boost in your tourism revenue. Not all adaptation strategies are going to have that kind of immediate return. So it's harder to get the public excited about investment in flood drains, or in elevating homes. So I think that we're in this phase right now of transition and pushing to do business as usual, as long as we can, and community by community, they're going to come up against the limits of that ability to sustain themselves.
Daniel Raimi: Right. Yeah. So I mean, to put it really coarsely, one could think of this as a sort of bandaid type solution, whereas in a longer term we need sort of maybe more structural changes. Is that a fair way to characterize it?
Megan Mullin: I think that's a fair way to characterize it. I also think it's perfectly understandable, right? These communities are doing what they can to keep what they have as long as possible, and that makes sense to me.
Daniel Raimi: Yeah. As someone who has enjoyed the North Carolina beaches for many years, having grown up there, yeah, I appreciate that very strongly. So let's go now, Megan, to our last question which we ask all of our guests, which is what you are reading or watching or listening to related to the environment that you think is really interesting or fun and that you'd recommend to our listeners. And I'll just sort of start with an article that I read as I was preparing for this conversation, which was in the website called The Conversation, which is a website that publishes work by academics but written for very broad audiences. And right perfectly at my level they have a section called Curious Kids, which is articles for children. So that matched my knowledge level for this topic for sure.
And there was an article called “Where does beach sand come from?” And it was a description of kind of the physical processes that lead to beach sand becoming beach sand and eroding over time. How it differs in different parts of the world, how it moves around both on land and in the water, and then how human activities are changing it. So that was just a really nice primer for me. And also lots of cool pictures and interesting ways to think about beach nourishment and other things related to beaches. But how about you Megan, what's at the top of your reading stack?
Megan Mullin: I'm going to keep with the kids theme—I'm really interested in how climate change appears or more commonly doesn't appear in music and movies and TV, and what the kind of broader public is seeing and thinking about climate change. And so one thing that interested me recently was the Netflix series, Dark Crystal: Age of Resistance, which is a prequel to the old Jim Henson Dark Crystal movie. And there's really an allegory in it for climate change, right? And like an allegory, right, it's very simple; there's good, there's evil. There are sort of sharply drawn lines. But underneath that is this really complex treatment of what we owe to one another. And how we might come together across differences to confront this common challenge. And in addition to that, there are some really beautiful puppets.
Daniel Raimi: Great. That sounds so cool. I have to check that out. If I've never seen the original Dark Crystal movie, I know that's probably a sin, but I've never seen it. Will I still enjoy the prequel?
Megan Mullin: Even more.
Daniel Raimi: Okay, good. All right, well, I'll have to check it out and I hope our listeners will as well. And once again, we'll say thank you to Megan Mullin from Duke University for talking to us today about your really fascinating work. We really appreciate it.
Megan Mullin: Thank you. I enjoyed it.
Daniel Raimi: You've been listening to Resources Radio. If you have a minute, we'd really appreciate you leaving us a rating or a comment on your podcast platform of choice. Also, feel free to send us your suggestions for future episodes. Resources Radio is a podcast from Resources for the Future. RFF is an independent nonprofit research institution in Washington DC. Our mission is to improve environmental energy and natural resource decisions through impartial economic research and policy engagement. Learn more about us at rff.org
The views expressed on this podcast are solely those of the participants. They do not necessarily represent the views of Resources for the Future, which does not take institutional positions on public policies. Resources Radio is produced by Elizabeth Wason with music by me, Daniel Raimi. Join us next week for another episode.