Local Issues: Penticton Beaches

Water is an amazing resource.  Not only do we need it for basic survival, to grow our food, and to provide valuable ecosystem services, we also enjoy it as part of our recreation – beaches, boating, etc.  Conversations involving water are never simple!

City Council in Penticton has recently approved a proposal to redevelop part of the beach park along Skaha Lake, giving something like 20% of the park to a private interest for thirty years.

The Okanagan valley is expected to attract more than 100,000 residents in the next 20 years, approximately a 30% population increase.  Most of these people will settle in or close to the major population centers around Okanagan Lake, Kelowna, Penticton, Vernon and West Kelowna (Okanagan Valley Profile).  Many of these people move here because of the climate and natural beauty of the valley, and access to the lakes is part of that.

Among Okanagan communities, only Penticton has large, uninterrupted beach waterfront.  Kelowna has the longest sandy foreshore on the lake, but most of this is behind private homes.  While technically the land is public up to the high water mark, these private property owners are known to not be particularly welcoming or accommodating of the public who may want to use the beach in front of their residence.  The public is therefore restricted to using the limited public beach space.

Beaches are interesting places.  Excepting some romantic fantasies, most people do not want to go to long, uninterrupted beaches with nobody else around.  We go to the beach to play in the water with friends and family, to sit on the shore with friends, and in part also to see and be seen.  However, beyond a point, beaches do become crowded, and the experience becomes less enjoyable.  This means that as the population grows, the value of beach space to the public that does not own beachfront increases.  All else equal, communities should be purchasing and developing more public beach space as their population grows.

However, all things are not equal.  While being the only person on a large beach looses its appeal pretty quickly, having a small piece of beach where one gets to choose who to share it with is attractive, and this gets more attractive the more crowded the public beaches get.  Waterfront property gets bought by the wealthy.  They invest in building large, expensive homes, further driving up the price, which makes it that much more expensive for local government to purchase these properties and convert them to public spaces.  Local governments acquire road allowances often decades before they are needed, to avoid the cost of purchasing developed land in the future.  Maybe beachfront should be (have been) thought of the same way, acquired before it was expensive and held for public use.  Here in the Okanagan, only Penticton seems to have acted this way.

What of Penticon’s plans?  A portion of the park will be leased to a private interest, who will have exclusive use of that portion of the park to operate a for profit business.  The city will receive lease payments and there is a profit sharing arrangement to be worked out as well.  The justification put forward to the media by Penticton politicians seems to emphasize these financial aspects of the arrangement, suggesting that they made the right choice because it is financially beneficial to the city government.

The world would be a much easier place to manage if cash flow measures such as profits and tax revenues were a complete measure of everything that mattered.  Public beaches do provide value.  Measuring that value is challenging, in part because no admission fee is charged.  However, people do pay to use the beach, in the form of the time it takes to get there, fuel and wear and tear if they drive, etc.  Since the value of the enjoyment from visiting the beach must on average be greater than these costs if people are to continue going to the beach, we can estimate part of the value of this enjoyment by measuring what people spend to access the beach.  This includes the time it takes to get to the beach and back home – driving/cycling/walking time, time to find parking, time to find a space on the beach, etc.  If it takes 20 minutes for the average beach user to get the the beach, then that is 40 minutes for the trip, which if that time is valued at the minimum wage, is worth about $7.  If reducing the public park space by 5-10% reduces public park use by 200 people per day for two summer months – the remaining beach is more crowded, so people do something else – then the cost is $84,000 per year.  In economics, we’d call this part of the opportunity cost of the project, and it should be counted as a cost against the benefits that the council politicians have spoken about.  This method of putting a number on the value of a public space is know as the Travel Cost Method (for more, visit http://www.ecosystemvaluation.org/).

Some of this cost will show up as revenue to the development – we’ve turned a public benefit into a private benefit that shows up as payment of the entrance fee to the new facility.  However, this changes something that people would use based on how long they were willing to wait to find a spot on the beach to something people use based on how much they are willing to pay.  Now something where access was unrelated to income – except in so far as people with higher income were more likely to stay away – has been changed to something where access is dependent on income.  The new facility is not the YM/YWCA, but a for profit enterprise, and admission fees will certainly reflect this.  So, while Penticton has technically not given or sold the public land, it has changed its nature so that low income people are essentially excluded.

Is this the right thing to do?  Will Penticton earn enough from this deal so that it is able to offer improved park space elsewhere that truly substitutes for what has been lost, or have they made all of Penticton a bit poorer because it looks better on the budget lines?

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