Laserfiche WebLink
of <br />40 <br />• <br />0 <br />It was assumed that oceanfront property owners with vacant land will "do <br />nothing" in the absence of a project and the benefits to these properties are set <br />equal to the dollar savings in land loss prevention. Given the state policies on <br />shoreline armoring, it is extremely doubtful that a Coastal Construction Control <br />Line permit for shoreline armoring of vacant properties would be granted by the <br />Department of Environmental Protection (DEP). In cases where the project <br />benefits received by vacant properties without an erosion control structure <br />exceeds the total land value, the benefits are set equal to the total property <br />value. In effect, this limits the expected erosion and storm losses if nothing is <br />done and accounts for oceanfront properties that are characterized by high <br />erosion rates and locations where future land development is not probable. <br />Properties that would not install an erosion control structure in the absence of <br />the project include: vacant properties, where no building loss could be <br />i <br />experienced, and the properties that are located sufficiently landward from the <br />mean high water line. The resulting storm protection and land loss prevention <br />benefits calculated for each beach area is summarized in Table 3. <br />2.3 TOTAL STORM PROTECTION BENEFITS <br />The storm protection benefits of the proposed beach restoration projects were <br />calculated over a 30 -year project horizon and reduced to net present value. In <br />order to reduce the annual value to net present values, we utilized a "corrected" <br />interest rate. At the present time, the typical interest rate is five (5) percent. If <br />this five (5) percent rate is used as the discount factor, it would leave out the <br />impact of future inflation. Therefore. the inflation ratp m11st hek cilhtroM-4 G -- <br />the bonds interest rate. Though the inflation rate has fluctuated over time, the <br />average rate of inflation for the past two years has been two (2) percent. In <br />effect, the real discount rate is, therefore, three (3) percent. <br />OB -B WPHS2RE PORTJDRAFT=O19WKMF. <br />12 <br />