ERA Economics and a team of technical experts at CH2M Hill and UC Davis were engaged by the California Department of Food and Agriculture (CDFA) to evaluate the impact of the California drought spanning 2014 – 2016 on its agricultural industry. ERA developed and applied a series of economic models that were used to quantify the effect of reduced water supplies on agricultural production, the value of the industry, and regional economic impacts in terms of jobs and value-added. ERA was responsible for technical model development, outreach, and analysis of water supply impacts. The projects spanned a total of three years and included outreach across various agencies, including the Governor’s Drought Task Force.
ERA Economics found that the California drought posed substantial challenges for agriculture, but that these challenges were largely mitigated through increased reliance on groundwater, with increased costs of approximately $600 million. The remainder of the loss in available surface water resulted in an estimated 564,000 acres fallowed and $850 million in lost crop production. Our team further found that the direct cost of the 2015 drought totaled $1.8 billion and nearly 9,000 farm jobs, with even greater spillover effects and losses.
The project included extensive public outreach. ERA experts participated in a range of industry panels, media events, and public presentations to convey the results of the California drought impact analysis to industry and policymakers. The project reports were published in peer-reviewed outlets and as policy publications. ERA presented the results to news radio and television, ultimately meeting with lawmakers in Washington DC to review the study, economic costs, and potential solutions.