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ECONOMI C ANAYSI S
<br />Much of the data below was derived from the 2002
<br />California Boating Facilities NeedsAssessment
<br />(BNA) - a comprehensive assessment of boats
<br />and boating facilities statewide. Volumne V -
<br />Boating Economic Assessments and Facilities
<br />Demand Projections -summarizes the economic
<br />benefits of boating to California, the values of
<br />recreational boating in California, and the demand
<br />projections for boating and boating facilities derived
<br />from the 2001 California Boats and Boaters Survey
<br />(BBS).
<br />INTRODUCTION
<br />The economic justification of any proposed project
<br />rests upon a comparison of the benefits and costs
<br />attributable to the project. A benefit/cost analysis
<br />is performed to demonstrate whether the total cost
<br />of a project to society is justified by its. overall
<br />benefit to society. A project is deemed beneficial
<br />and therefore economically feasible when total
<br />benefits equal or exceed total costs. A glossary
<br />with data sources follows this section.
<br />TAKE 1 A
<br />ANNUAL BOa7 U1tHES 8,500
<br />AYI~ACE PERSONS ABOARD 4.0
<br />ANNUAL BASE YEAR USER DAYS 34,000
<br />The Benefit/Cost Process
<br />The first step in the benefit/cost analysis is to
<br />determine annual benefits. Annual benefits are
<br />determined by calculating the annual base year
<br />userdays (Table 1A) and the annual percentage
<br />growth rate (.1 % for this project). These two are
<br />multiplied to give the project user days per year.
<br />The project user days per year are multiplied by a
<br />user day value plus the expected annual percent
<br />increase in the Consumer Price Index to give
<br />annual benefits (Table 2).
<br />Next, annual costs are determined by multiplying
<br />the existing or projected annual boat launches for
<br />the facility by the cost per boat launching and the
<br />expected annual percent cost escalation rate to
<br />give annual costs. If there is no charge for boat
<br />launching at the facility, a standard cost is
<br />substituted in the equation (Table 3).
<br />Project benefits per year and project operating
<br />costs per year are then discounted to yield their
<br />net present value. Since the value of a dollar is
<br />considered to be greater in the present year than
<br />TABLE 2
<br />PRdJECT USER DAYS
<br />1 34,034
<br />2 34,068 USERflAY~/ALUE ~ , 17.89--
<br />3 34,102 CP1 2.6%
<br />4 34,136
<br />5 34,170 Ar+~IUAt BB+~ITS 1 608,868
<br />6 34,205 2 625'324
<br />7 34,239 3 625,949
<br />8 34,273 4 626,575
<br />9 34,307 5 627,201
<br />10 34,342 6 627,829
<br />11 34,376 7 628,456
<br />12 3a,4~o s 629,os5
<br />13 34,445 9 629,714
<br />14 34,478 10 630,344
<br />15 34,514 11 630,974
<br />16 34.548 12 631,605
<br /> 13 632,237
<br />17 34,583 14 632,869
<br />18 34,617 15 633,502
<br />19 34,652 16 b34,135
<br />20 34,68E 17 634,769
<br /> 18 635,404
<br /> 19 636,040
<br /> 20 636,676
<br />in some future year, a discount rate is applied in
<br />order to de-inflate the future dollars and to convert
<br />the benefits and costs occuring over the 20 year
<br />grant period to a present day value. In this manner,
<br />the present day value may be comparable to other
<br />values in the present.
<br />The sum of the presentbenefitssnd the discounted
<br />future benefits is the net present value of the project
<br />(Table 4). The sum of the present costs, including
<br />capital costs, and the discounted future costs is
<br />the net present cost of the project (Table 5).
<br />San Leandro Marina BLF 4
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