Orestimba Creek Feasibility Study - Stanislaus County

Economics Appendix – Draft Report - Orestimba Creek Feasibility Study, Stanislaus County, California – September 2012
Table 7-1: Total Annual Benefits and Costs by Alternative
October 2011 Prices ($1,000’s), 4% Interest Rate
Based on a 50-year Period of Analysis
FRM Costs/Benefits
ITEM
Tentatively Recommended
NED Plan (Alt 2)
Plan (Alt 3)
Investment Costs:
First Costs 35,219 44,056
Less Cult Res (281) (353)
Less Sunk PED costs 0 0
Interest During Construction 2,141 2,679
Total 37,079 46,382
Annual Cost:
Interest and Amortization 1,726 2,159
OMRR&R 164 180
Subtotal 1,890 2,339
Annual Benefits: 3,128 3,128
Net Annual FRM Benefits 1,238 789
FRM Benefit-Cost Ratio 1.66 1.34
The NED Plan is Alternative 2, the stand-alone Chevron Levee at the optimized elevation of
112.75 feet. The NED and it has an annual net benefit of $1.2 million and a Benefit-to-Cost
Ratio (BCR) of 1.6. The Tentatively Recommended Plan is Alternative 3, the stand-alone
Chevron Levee at an elevation of 114.8ft. The Recommended Plan has net annual benefits of
$0.8 million and a BCR of 1.3
7.2.3.1 Net Benefits and BCR sensitivity to uncertainty
The table below summarizes the Net Benefits and BCR ranges for each of the final array of
alternatives. The low annual benefit represents the 75% confidence (that benefits will exceed the
indicated value), the mid represents the 50% and the high annual benefit represents the 25%
confidence level. The low annual cost represents the 25% confidence (that costs will be less than
the indicated value), the mid annual cost represents the 50% confidence and the high cost
represents the 75% confidence. Net Benefit and BCR mean values and ranges were calculated in
a Monte-Carlo simulation using a triangular distribution in the annual benefits and the annual
costs. The mean Net Benefit and BCR represent the mean result from this Monte Carlo
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