Biden Administration issues new guidance on how the Corps and other federal government agencies should incorporate environmental and ecosystem services in their project benefit-cost analyses

Preparing benefit-cost analyses consistent with Office of Management and Budget (OMB) Circulars A-4 or A-94 often involves analyzing ecosystem services. This guidance uses the term ecosystem services to encompass all relevant contributions to human welfare from the environment or ecosystems. The United Nations defines ecosystem services as “the contributions of ecosystems to the benefits that are used in economic and other human activity.”1 However, changes in ecosystem-derived benefits often result from, relate to, or precipitate changes in other environmental costs and benefits, and all of these effects should be considered in a benefit-cost analysis prepared pursuant to the OMB circulars. This document, “Guidance for Assessing Changes in Environmental and Ecosystem Services in Benefit-Cost Analysis,” describes best practices for analyzing the incremental or marginal changes in these services in the benefit-cost analysis context. For simplicity and clarity of presentation, rather than distinguishing ecosystem-derived benefits from other interrelated environmental effects throughout this document, this guidance uses the term “ecosystem services” to include all such effects.

Draft Es Guidance