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This study constitutes the third in a series of studies conducted for the USEPA exploring the use of the contingent valuation method (CVM) for valuing environmental benefits. The CVM is the only methodology now available for measuring non-use benefits which likely comprise a large portion of values for environmental commodities. The measurement of the total benefits (including use, altruistic, bequest and existence values) of cleaning up contaminated groundwater is necessary to evaluate a variety of programs including Superfund (CERCLA) and the Resource Conservation and Recovery Act (RCRA). In particular EPA has proposed a comprehensive regulatory framework for corrective action (55FR: 30798-30884. July 27, 1990) based on the Hazardous and Solid Waste Amendments to RCRA of 1984 which broadened EPA’s authority to include releases from all solid waste management units. The Office of Solid Waste is in the process of conducting a Regulatory Impact Assessment of this proposed rule which includes the costs and benefits of corrective actions regarding groundwater contamination. Thus, one immediate purpose of this study is to provide information for estimating the benefits of groundwater cleanup.

A theoretical model of the benefits from cleaning up groundwater shows that careful survey design is imperative to the measurement and estimation of values. Interdependent utilities (in the case of nonpaternalistic altruism) generate values that may result in double-counting if the method of payment is not specified in the survey instrument (ie., one household need not pay to help another if the recipient household is able to pay to …