Palm Beach County, Florida Shore Protection Project Jupiter Carlin Segment Integrated 934 Report & EA Economics Appendix

Transcription

1 Palm Beach County, Florida Shore Protection Project Jupiter Carlin Segment Integrated 934 Report & EA Economics Appendix US Army Corps of Engineers March 2017 Jacksonville District

2 Table of Contents Executive Summary Introduction Purpose of Report Design of Document Existing Conditions Beach fx Economic Modeling Approach Overview of Existing Structures and Data Organization Existing Condition Structures and Contents Armor Future Without Project Condition (FWOP) Starting Shoreline Position FWOP Economic Model Assumptions Beach fx FWOP Simulation Results Structure and Content Damages Armor Damages Spatial Distribution of Damages Temporal Distribution of Damages FWOP Damages by Damage Driving Parameter FWOP Damages in alternative Sea Level Rise (SLR) scenarios Beach fx FWOP Simulation Conclusion Future With Project (FWP) Conditions Existing Federal Project Optimization of Federal Project Comparison and Evaluation of the initial array of alternatives Alternative Comparison and Evaluation of the Final Array Tentatively Selected Plan Project Performance in the SLR scenarios Refined Costs of the Recommended Plan Economic Cost of the Recommended Plan Benefits of the Recommended Plan Storm Damage Reduction Benefits

3 5.3.2 Land Loss Benefits Incidental Recreation Benefits BCR and Net Benefits of the Recommended Plan Conclusion and Recommendations Addendum A: Alternate Modeling Approach List of Figures Figure 1 Project Vicinity Map... 5 Figure 2 Aerial view of Reaches JC 13 2 through JC 16 1 with all lots and damage elements identified... 9 Figure 3 Seaside view of the Ocean Trail Condominium complex Figure 4 Seaside view of the Jupiter Beach Resort Condominium complex Figure 5 Coastal Amor in the Project Area as modeled in Beach fx Figure 6 Starting Shoreline posistion: current vs FWOP condition Figure 8 Damages and Armor Cost Incurred Over Time in Constant Dollars Figure 9: Jupiter Carlin Project Profle Comparison Figure 10 Damages and Costs over time Figure 11 Jupiter Carlin 934 Report: Overall Economic Summary Figure 12 Amor Cost over time as modeled in Beach fx... Error! Bookmark not defined. 3

4 Executive Summary The Federal Palm Beach County Shore Protection Project (SPP), Jupiter Carlin Segment is located in Southeastern Florida (northern Palm Beach County). As originally authorized the project spans Florida Department of Environmental Protection (FDEP) reference monuments R 13 (just south of Jupiter Inlet) to R 19 (Carlin Park) and restores approximately 1.1 miles of beach. According to the authorization, and as described in House Document 164/87/1, the project called for a seaward extension of approximately 100 feet from the mean high water (MHW) line, with a berm elevation of 10 feet above mean low water, and a seven year nourishment interval. The design template is a 0 foot berm extension of the 1990 MHW line. Palm Beach County constructed the initial project in 1995 and renourished the beach in In accordance with Section 934 of the 1986 Water Resources Development Act (WRDA) (Public Law ), the purpose of this study consists of determining whether the authorized project is still economically justified given current conditions and, if not justified, optimizing the authorized project. In support of the 934 Report, economic analysis was completed to determine whether future nourishments of this segment are economically justified and thus whether an extension of Federal participation in cost sharing through the year 2045 is warranted. Because the project was originally constructed in 1995 a full 50 year period of Federal participation, if approved, would end in Through the analysis it was determined that the 100 foot extension originally authorized is no longer economically justified. However, an optimization of the originally authorized plan is proposed in the current document. The specific purpose of this appendix is to describe the economic analysis of the 934 Report, including the future without project (FWOP) and future with project (FWP) conditions as simulated by the Corps certified model Beach fx. This appendix contains the approach, assumptions, and results of the economic analysis. The economic analysis resulted in an optimized nourishment template that differs from the authorized project. Based on existing conditions, the optimized project consists of a 10 foot seaward extension beyond the design berm, with a five year nourishment interval. The total cost of the first renourishment is estimated to be $14.6 million. The average annual benefits and costs of the proposed optimization are $2,509,000 and $1,546,000, respectively. The average annual net benefits of the proposed optimization are $963,000, and the BCR is The analysis described above is based on a modeling approach in which both the future without project condition and future with project condition use the same starting shoreline position. These results were compared to an alternate approach, in which the FWOP condition used the 1995 shoreline as its starting point. The alternate approach is fully consistent with 934 guidance, which states that the starting shoreline used in the FWOP analysis should reflect the pre construction template. However, the alternate approach creates illogical model results due to the differing starting shoreline positions in the FWP and FWOP conditions. The results of the alternate approach indicate that the project would still be economically justified when recreation benefits are included, though the BCR and net benefits would be lower. When using the alternate approach, the average annual net benefits of the proposed optimization are $883,000, and the BCR is

5 1 Introduction The Jupiter/Carlin segment of the Palm Beach County Shore Protection Project is located in the north end of Palm Beach County on the east coast of Florida. The project sits approximately 80 miles (mi) north of Miami and approximately 250 mi south of Jacksonville, Florida. The authorized project extends from near the south jetty of the Jupiter Inlet a distance of approximately 1.1 mi to Carlin Park at its southern limit. The project spans Florida Department of Environmental Protection (FDEP) reference monuments R 13 to R 19, a state designated critical erosion area. The project area is shown in Figure 1. The authorized project provides for initial construction and periodic nourishment at seven year intervals along 1.1 miles of shoreline. Palm Beach County constructed the initial project in 1995 and renourished the beach in Federal participation in cost sharing expired in 2005, ten calendar years after initial construction in Section 934 of the 1986 Water Resource Development Act (Public Law ) provides discretionary authority to the Secretary of the Army, acting through the U.S. Army Corps of Engineers Office of the Chief of Engineers, to extend federal participation to the 50th year after the date of initial construction of a project (2045). Figure 1 Project Vicinity Map 5

6 1.1 Purpose of Report The Jupiter Carlin 934 Report is intended to investigate the feasibility of extending the period of Federal participation for the authorized project to a full 50 years. This would add 27 years to the project life, from 2019 through The purpose of this document is to describe the economic analysis of the 934 Report, including the future without project (FWOP) and future with project (FWP) conditions as simulated by the Corps certified model Beach fx. It is intended to explain the approach, assumptions, and results of the economic analysis. 1.2 Design of Document The purpose of the Section 934 Report is to tell the entire story of extending Federal participation in future nourishments of the Jupiter/Carlin segment to the year The purpose of the economics appendix is to provide a technical guide to methods, assumptions, and results of the economic analysis. Section 1 of this Appendix provides an introduction, Section 2 provides a detailed description of the existing condition and overall modeling approach; Section 3 provides detailed summary of the future without project condition including information about the spatial and temporal distribution of estimated damages. Section 3 also provides a summary of the sea level rise (SLR) analysis. Section 4 describes the future with project (FWP) condition as simulated in Beach fx, as well as information about alternative comparison and evaluation. Section 5 describes the Recommended Plan in more detail, including benefits, refined costs, a benefit cost ratio (BCR), net benefits, and information about project performance in the SLR scenarios. Section 5 also has a brief conclusion. After Section 5, an addendum has been added that explains a potential alternate approach. 2 Existing Conditions 2.1 Beach fx Economic Modeling Approach Beach fx was developed by the USACE Engineering Research and Development Center (ERDC) in Vicksburg, Mississippi. The model links the predictive capability of coastal evolution modeling with project area infrastructure information, structure and content damage functions, and economic valuations to estimate the costs and total damages under various shore protection alternatives. Beach fx fully incorporates risk and uncertainty, and is used to simulate future hurricane and storm damages at existing and future years and to compute accumulated present worth damages and costs. Storm damage is defined as the damage incurred by the temporary loss of a given amount of shoreline as a direct result of waves, erosion, and inundation caused by a storm of a given magnitude and probability. Beach fx is an event driven life cycle model that estimates damages and associated costs over a 50 year period of analysis based on storm probabilities, tidal cycle, tidal phase, beach morphology and many other factors. Damages or losses to developed shorelines include buildings, pools, patios, parking lots, roads, utilities, seawalls, revetments, bulkheads, replacement of lost backfill, etc. Beach fx also provides the capability to estimate the costs of certain future measures undertaken by state and local organizations to protect coastal assets. It should be noted that the future structure inventory and values are the same as the existing condition. This conservative approach neglects any increase in value due to future development. Due to the uncertainty involved in projections of future development, using the existing inventory is preferable and considered conservative for Florida where coastal development has historically increased in density and value. 6

7 The Jupiter Carlin Beach fx model has been developed in close collaboration with the SAJ Engineering Division. All coastal morphology inputs were developed by the SAJ engineering team (see engineering Appendix). This model has been built in accordance with the Beach fx User s Manual (August 2009); the manual is referenced throughout this document. 2.2 Overview of Existing Structures and Data Organization Economists, real estate specialists, and engineers have collected and compiled detailed structure information for the 1.1 mile stretch of shoreline authorized for the Jupiter Carlin Shore Protection Project (FDEP Monuments R 13 through R 19), which includes: Six condominium buildings Parking lots, parking garages, access roads, pools, decks, tennis courts, guard/pool houses, and dune walkovers associated with the condominiums Three large public parking lots Public roadways Carlin Park Civic Center Lazy Loggerhead Café Several public pavilions, gazebos, bath houses, and dune walkovers. In addition to structures located in the 1.1 miles of shoreline that comprise the authorized project, structure information was compiled for the approximately 1.5 miles of shoreline down drift of the authorized project area (FDEP Monuments R 19 to FDEP Monuments R 26). State Road A1A, the Jupiter Beach Club Resort, a parking lot, and several dune walkovers are included in the down drift analysis. Inclusion of this down drift shoreline is consistent with the economic analysis presented in the Palm Bean County, FL Shore Protection Project General Design Memorandum Addendum for Jupiter/Carlin Segment. In total, attribute information for 206 separate damage elements (151 damage elements within the authorized project area and 55 damage elements down drift of the placement area) was populated for economic modeling using Beach fx. The proximity of these buildings, roads, and other structures to the beach makes them potentially vulnerable to erosion, wave, and flood damage. The Jupiter Carlin project area, because of its relatively short length, is not broken out into separable study reaches for incremental analysis. The project area was disaggregated into 7 profiles, 7 model (Beach fx) reaches, and 19 lots, for economic modeling and reporting purposes. Similarly, the down drift shoreline is made up of one profiles, 7 model (Beach fx) reaches, and 10 lots. Figure 2 shows an aerial view of the Beach fx model features within the project area. This hierarchical structure is depicted as follows: Beach Profiles: Coastal beach profile surveys were analyzed by USACE Jacksonville District (SAJ) Coastal Engineering personnel to develop representative beach profiles that include the dune, berm and submerged portions of the beach. The representative beach profiles are used for shore response modeling in the SBEACH engineering numerical model, and only referred to in this section for informational purposes. Beach Fx (Model) Reaches: Quadrilaterals with a seaward boundary that is parallel with the shoreline that contain the Lots and Damage elements, and that are used to incorporate coastal morphology changes for transfer to the lot level. Model reaches are also useful for developing study reaches into more manageable segments for analysis. After the FWOP conditions are modeled, the Beach fx reaches will be grouped into design reaches to represent separable increments delineated based on shoreline condition and FWOP damages, where unique FWP alternatives could be implemented. 7

8 Lots: Quadrilaterals encapsulated within model reaches used to transfer the effect of coastal morphology changes to the damage element. Lots are also repositories for coastal armor costs, specifications, and failure threshold information. Damage Elements: Represents the smallest unit of the existing condition coastal inventory and a store of economic value subject to losses from wave attack, inundation, and erosion damages. Damage elements are a primary model input and the topic of focus in this discussion. The primary structure categories are coastal armor and coastal structures. More details on the establishment of the Profiles and Beach fx Model Reaches, which is primarily based on physical shoreline characteristics, can be found in the Appendix A Engineering. Beach fx handles economic considerations at the Lot and Damage Element levels. These considerations include armor construction costs at the Lot level, and the extent of damage and rebuilding costs at the Damage Element level. When damages occur in Beach fx, Damage Elements may be partially rebuilt depending on the extent of modeled damage. Beach fx calculates rebuild costs as the difference in the structures depreciated replacement value before and after the damage occurs. Section Error! Reference source not found. will provide further detail on the Lot and Damage Element attribute data that makes up the structure inventory for this project area. 8

9 Figure 2 Aerial view of Reaches JC 13 2 through JC 16 1 with all lots and damage elements identified 9

10 2.2.1 Existing Condition Structures and Contents The economic value of the existing structure inventory represents the depreciated replacement costs of damageable structures and their associated contents within the study area along the coastline. The damage element inventory includes 206 damageable structures with an overall estimated value of $135 M, with structure and content valuations of $103 M and $32 M respectively. Values aggregated by Beach fx Reach show variation due to differentiation between the type, magnitude, and density of development. The two Beach fx Reaches (JC 15 1 and JC 16 1) that include the six condominium structures account for 95% of the structure and content value of the entire study area. Of all structures considered in the analysis, only approximately 3% of the total structure value lies down drift of the project area. Table 1 provides the distribution of structure and content values broken down by Beach fx Model Reach. Pictures of some of the condominium structures are provided in Figures 3, and 4. Table 1: Distribution of Structures and Structure Values by Model Reach Beach Fx Reach DE Count Structure Value Content Value A summary of the damage elements by Study Reach is provided in Table 2. Total Value % of Total Value JC $ 9, $ $ 9,585 0% JC $ 472, $ $ 472,644 0% JC $ 26,214, $ 7,901, $ 34,115,318 25% JC $ 71,457, $ 23,168, $ 94,625,437 70% JC $ 68, $ $ 68,400 0% JC $ 515, $ 90, $ 605,571 0% JC $ 1,200, $ 183, $ 1,384,638 1% JC $ 335, $ $ 335,385 0% JC $ 1,618, $ 700, $ 2,318,149 2% JC $ 218, $ $ 218,038 0% JC $ 243, $ $ 243,944 0% JC $ 163, $ $ 163,313 0% JC $ 141, $ $ 141,588 0% JC $ 81, $ $ 81,241 0% Total 206 $ 102,739,970 $ 32,043,280 $ 134,783, % Note: JC 20 1 through JC 26 1 make up approximately 1.5 miles of shoreline down drift of the project area. 10

11 Table 2: Distribution of Structures and Structure Values by Model Reach # Structures Value DE Type Project Reach Downdrift Reach DE Type Project Reach Downdrift Reach CABANA 6 1 CABANA $212,190 $14,050 COMM 3 0 COMM $1,325,250 $0 DECKS 6 2 DECKS $335,155 $32,730 GARAGE 5 0 GARAGE $505,940 $0 GAZEBO 22 1 GAZEBO $468,000 $10,760 ISOLATED 6 0 ISOLATED $117,000 $0 MFR MFR1 $109,039,500 $1,397,080 MFR2 2 1 MFR2 $6,426,000 $702,980 MFR3 5 0 MFR3 $3,726,000 $0 PARKINGLOT 19 3 PARKINGLOT $1,161,957 $16,910 POOL 11 2 POOL $235,270 $25,370 ROAD1 6 0 ROAD1 $588,337 $0 ROAD ROAD2 $127,044 $1,224,882 SHOWER 1 15 SHOWER $600 $9,000 TENNIS 4 0 TENNIS $157,500 $0 UGPARK 5 0 UGPARK $6,300,000 $0 UTILITIES 5 0 UTILITIES $490,000 $0 WALK 9 16 WALK $65,850 $67,895 Total Total $131,281,593 $3,501,657 As noted in both tables, the majority of structures and total value subject to damage are located in the project reach. In addition to the Condos, the project reach includes Gazebos, roads, parking lots, pools, tennis courts, and dune walks. 11

12 Figure 3 Seaside view of the Ocean Trail Condominium complex 12

13 Figure 4 Seaside view of the Jupiter Beach Resort Condominium complex Armor Beach fx handles coastal armoring parameters and condemnation at the lot level. Lots are designated as being either armored, armorable in the future, or not armorable, based on coastal regulations that dictate armor construction and local history on armor permitting and construction. Since armoring forms one of the major roles of lots in Beach fx, the location and length of potential future armoring dictates the seaward boundary of most lots. Data on coastal armor within the project area was collected from a variety of sources including site visits, aerial photography, and USACE SAJ Coastal Engineering personnel. Coastal armor value was determined by USACE SAJ Cost Engineering personnel. The project area contains only one instance of existing coastal armor. This is a 40 foot long steel sheet pile seawall with a concrete cap that fronts the Jupiter Beach bath house. The location of this existing armor is shown as the red lot in Error! Reference source not found., just north of R 14. Lots that are already armored are shown in red. The downdrift area modeled in Bach fx includes an additional instance of existing armor located near R 21. This sheet pile seawall fronts the Jupiter Reef Club Resort complex. The project area shoreline that is not currently armored has been categorized as being either armorable in the future or not armorable. This categorization is based on the assumed likelihood that armor would or would not be constructed by local interests in the future, should a Federal Project not be implemented. Lots designated as armorable in the future are shown in yellow in Error! Reference source not found.. It is assumed that the five condominiums along the shoreline and the Civic Center would be armored by 13

14 local interests with steel sheet pile seawalls (similar to existing seawalls protecting the Jupiter Park bath house and other condominiums within Palm Beach County, FL), once the shoreline eroded to within 30 feet of the structures. These structures would be eligible for armor permits under Florida s Coastal Construction Control Line (CCCL) program and local interests would likely be willing to incur the armor costs in order to protect these valuable structures. As recently as 2014 several steel seawalls have been permitted and constructed to protect shorefront condominiums in Palm Beach County, where erosion has encroached to within approximately 30 feet of the structure. Without continued Federal participation continued beach nourishment, a similar course of action will likely be taken for the Jupiter Carlin project area in the lots designated as armorable in the future. SAJ Cost Engineering personnel estimate that future sheet pile seawalls will cost $12,219 per linear foot. Not armorable lots are shown in green in Figure 5. It is assumed that these lots would not be armored in the future either because the property would not be eligible for armor construction under the CCCL criteria or the property owner would likely find that armor is more costly that the infrastructure being protected. In the area modeled, lots that are empty or contain only relatively low value structures such as dune walks or gazebos along the shoreline are assumed to be not armorable in the future. Additionally, all down drift areas that are not currently armored are specified as not amorable in the future for modeling purposes. A1A south of R 19 is County owned. The non federal sponsor, Palm Beach County, has not considered armoring this area of A1A. 14

15 Figure 5 Coastal Amor in the Project Area as modeled in Beach fx 15

16 3 Future Without Project Condition (FWOP) This section documents the future without project condition in detail, including modeling assumptions and results. 3.1 Starting Shoreline Position According to Section 934 guidance, the starting shoreline used in the FWOP analysis should reflect the pre construction template. A FWP condition can then be developed based on existing conditions (current surveys). The logic behind this approach is that it should be possible to evaluate the entire life of the project, including the proposed extension of Federal participation, by comparing it to an FWOP condition in which the project had never been built. Current guidance likely presumed that for 934 studies, the without project beach profile would be more eroded then the existing profile and that the physical orientation (angle with respect to north south) of the shoreline would remain constant. In this case, the pre construction template would be the 1995 shoreline before initial construction of the project. Between 1995 and 2015 both the shoreline position and physical orientation changed significantly (see below figure). In fact, the current condition of the Jupiter Carlin project is more eroded in some portions of the project than the pre construction profile indicates and the overall orientation of the shoreline between R monuments R 13 and R 15 has shifted. See Figure 6. Figure 6 Starting Shoreline posistion: current vs FWOP condition 16

17 Because of these changes, it is not possible to make valid comparison by using the pre project shoreline. Instead, both the FWOP and FWP conditions used in this analysis use the same 2018 starting profile. This makes it possible to evaluate the costs and benefits of the proposed plan over the 27 year period of analysis a true apples to apples comparison. The model results described throughout the appendix reflect this approach (i.e., the same 2018 starting profile). An alternate approach that is fully consistent with the guidance is presented in Addendum A of this Appendix. More information about the two approaches is provided in the official 2017 Jupiter Carlin Policy Interpretation Memo, also included as part of the report materials. 3.2 FWOP Economic Model Assumptions Start Year: The year in which the simulation occurs is 2018 Base Year: The year in which the benefits of a constructed federal project would be expected to begin accruing is 2019 Period of Analysis: 27 years (FY2019 through FY2045) Discount Rate: 2.875% FY2016 Federal Water Resources Discount Rate Damage Functions: Damage functions developed by the Institute for Water Resources (IWR), Coastal Storm Damage Workshop (CSDW), Coastal Storm Damage Relationships Based on Expert Opinion Elicitation in 2002, were used to the maximum extent possible. Damage functions used for the high rise condominium structures were developed based on their unique construction and foundation type, and are documented in a 2010 White Paper titled Large Building Flood Damage Functions, by Christopher P. Jones, P.E. Coastal Armor: Existing armor set at the lot level will protect the damage elements in that lot until failure is triggered. If the armor fails, structures will be subject to damages until the armor is rebuilt. Armor failure thresholds for erosion, wave attack, and inundation have been set based on the armor design and engineering judgment. When erosion reaches the seaward edge of armorable in the future lots, armor will be constructed at this location. Before the armor is built the damage elements are subject to damages. Once construction of the armor is completed, armor will function normally. Shorefront properties that are not armorable will not be armored in the future because of either permitting restrictions, or the cost of armor would not likely be warranted to protect the relatively low value structures on these properties. Number of Times Rebuilding Allowed: The maximum number of structure rebuilds can be specified for damage elements. Based on the assumed likeliness that certain types of damage elements will eventually stop being rebuilt by property owners, the following are the number of times that rebuilding is allowed for certain types of damage elements: Dune Walks: 6X Gazebos: 3X Isolated Structures: 3X Remaining: 99X 17

18 3.3 Beach fx FWOP Simulation Results Over 100 iterations the future without project condition damages range between $1.172 M and $3.476 M in average annual terms. Descriptive statistics on the FWOP model results are as follows: Mean Average Annual Damage: $1,737,189 Standard deviation: $352,302 Median: $1,432,041 The minimum iteration showed $1.172 million in average annual FWOP damage, while the maximum showed $3.476 million in damage. A breakdown of the type of damage is provided in Table 3. Table 3: Average Annual Damages by Category Damages Armor Costs Land Loss Damages + Armor Cost + Land Loss Updrift Reach $0 $0 $158, $158,521 Project Reach $204, $1,146, $16, $1,368,184 Downdrift Reach $170, $0 $40, $210,483 Total $374,750 $1,146,956 $215,482 $1,737,189 The breakdown makes it clear that the largest category of damage by far is armor damage in the main project reach. In this reach, new armor is constructed relatively early in most simulations. The new armor reduces or prevents future damage, but it also incurs its own cost Structure and Content Damages Structure damages refer to economic losses resulting from the structures situated along the coastline being exposed to wave attack, inundation, and erosion damages (not including armor damage or land loss). Content damages refer to the material items housed within the aforementioned structures (usually air conditioned and enclosed) that are potentially subject to damage. In the Jupiter Carlin FWOP condition, structure damages (about $375,000 in average annual damages) account for approximately 21.6% of the total FWOP damages. A summary of structure and content damages (by damage element type) is provided in Table 4. 18

19 Table 4: PV Structure and Content Damages by Damage Element Type (not including armor or land loss) Purpose: Show what is being damaged in each model reach in present value dollars. Type Project Reach Downdrift Reach CABANA $2,549 COMM $1,107,527 DECKS $20,776 $5,607 GARAGE $4,807 GAZEBO $278,407 $1,365 ISOLATED $1,303,308 MFR2 $1,518 MFR3 $5,909 PARKINGLOT $208,381 POOL $14 $4,282 ROAD2 $389,739 $2,940,047 SHOWER $12,048 UGPARK $352,540 UTILITIES $610 WALK $132,013 $199,634 Total $3,808,099 $3,162,982 *Note: Armor damage is the most important category of overall damage, the purpose of this table is provide more information about structure and contents damage. The two largest categories of damage by far are commercial and isolated property damage in the project reach, and road damage in the downdrift reach Armor Damages Beach fx provides the capability to estimate the costs incurred from measures likely to be taken to protect coastal assets and or prevent erosion in the study area. Armor damage is a broad category that includes direct damage to existing armor, and the costs associated with erecting new armor. In the Jupiter Carlin FWOP condition, armor damage (about $1.147 million in average annual terms) accounts for approximately 66% of the total FWOP damages. Thus, it is the most important category of damage Spatial Distribution of Damages There is a great deal of variability in the amount of damages amongst the Beach fx reaches. This is explained by the large number of variables, all of which the Beach fx model takes into account. Examples of variation between the reaches result from the following: Density and amount of development Typical size and value of structures Typical distance between structures and mean high water Size, shape and location of the dunes and coastal morphology Rate of erosion for each reach Amount and type of coastal armoring present Timing that property owners construct coastal armoring in the future. A spatial summary of the Gasparilla FWOP damages is presented in Table 5. 19

20 Table 5: Average Annual Damages by Reach Damages Armor Costs Land Loss Damages + Armor Cost + Land Loss Updrift Reach $0 $0 $158, $158,521 Project Reach $204, $1,146, $16, $1,368,184 Downdrift Reach $170, $0 $40, $210,483 Total $374,750 $1,146,956 $215,482 $1,737,189 The results indicate that the majority of damage (about 78%) occurs in the project reach Temporal Distribution of Damages The temporal distribution of damages is fairly front loaded. In most iterations, new armor construction is triggered quickly (in the early years of the simulation). This new armor helps protect the inventory from damage, but it incurs its own cost. Damages and costs that occur early in the simulation are not discounted as heavily as those that occur later, thus they can have a disproportionately large impact on average annual damage. Later in the simulation, some of the unarmored lots begin to accrue increasing erosion and land loss damage. These damages, while significant, are smaller in magnitude than the armor costs that tend to accrue early on. The distribution of non present value damages is summarized in Table 6 and Figure 8. 20

21 Table 6 Jupiter Carlin FWOP Damages and Armor Costs over time in constant dollars CY Damages Armor Cost Land Loss Damages + Armor Cost + Land Loss 2018 $0 $5,640,840 $0 $5,640, $99,613 $1,805,848 $0 $1,905, $80,396 $1,355,898 $1,050,422 $2,486, $237,265 $2,509,284 $1,265,507 $4,012, $335,653 $2,843,894 $820,918 $4,000, $263,093 $1,988,249 $12,572 $2,263, $127,595 $940,817 $4,440 $1,063, $119,622 $718,858 $220 $838, $221,602 $772,507 $1,413 $995, $131,243 $380,889 $837 $511, $251,195 $431,182 $88 $682, $161,892 $420,456 $0 $582, $249,736 $679,296 $192 $928, $273,846 $621,627 $9,677 $905, $306,088 $790,616 $121,585 $1,218, $350,092 $751,048 $2,160 $1,103, $372,294 $801,341 $4,591 $1,178, $379,160 $711,486 $2,325 $1,092, $390,000 $269,574 $10,049 $669, $593,594 $129,424 $122,791 $845, $662,365 $89,859 $7,682 $759, $545,705 $0 $639 $545, $709,540 $10,729 $0 $720, $686,728 $0 $46,618 $733, $799,591 $0 $751,782 $1,551, $1,119,058 $21,459 $793,416 $1,933, $864,623 $0 $32,503 $897, $598,622 $0 $28,084 $626, $460,158 $0 $1,628 $461,786 21

22 Figure 7 Damages and Armor Cost Incurred Over Time in Constant Dollars $4,500,000 Land Loss Damages Armor Cost $4,000,000 $3,500,000 $3,000,000 $2,500,000 $2,000,000 $1,500,000 $1,000,000 $500,000 $ These results indicate that the primary source of FWOP condition damages are armor costs triggered early in the period of analysis. Damage to the structure inventory is small in comparison to the construction of armor, and appears to accelerate later in the period FWOP Damages by Damage Driving Parameter Within the beach fx model environment, damage to structures and contents can be caused by three different damage driving parameters: flooding (inundation), wave attack, and erosion. The results of damage to structures and contents are broken out by parameter in the following Table 7. Table 7: PV Damages by Damage Driving Parameter ReachGroup FloodLoss ErosionLoss WaveLoss Project Reach 0.1% 53.9% 0.7% Downdrift Reach 0.0% 45.2% 0.1% Total 0.1% 99.0% 0.8% ReachGroup FloodLoss ErosionLoss WaveLoss Project Reach $8,653 $3,758,590 $49,246 Downdrift Reach $0 $3,153,094 $9,893 Total $8,653 $6,911,684 $59,139 22

23 Typically, in Florida coastal studies, the vast majority of damage (as estimated by Beach fx) is caused by erosion. This appears to also be the case in Jupiter Carlin, where an overwhelming majority is caused by erosion FWOP Damages in alternative Sea Level Rise (SLR) scenarios The FWOP condition was modeled for three sea level rise (SLR) scenarios. ER provides both a methodology and a procedure for determining a range of sea level rise estimates based on the local historic sea level rise rate, the construction (base) year of the project, and the design life of the project. The Beach fx results presented above refer to the baseline scenario, which is based on the historic erosion rate. The results associated with the other two SLR scenarios are presented in Table 8. Table 8: Simulated FWOP damages in the Sea Level Rise scenarios SLR1 (Baseline) SLR2 (Intermediate) SLR3 (High) Damage $374,750 $511,212 $799,876 Armor Cost $1,146,956 $992,376 $1,156,090 Land Loss $215,482 $293,948 $459,930 Total $1,737,188 $1,797,536 $2,415,896 The results are largely what might be expected, with FWOP damages increasing at an increasing rate with greater rates of SLR. The intermediate scenario only produces damages that are slightly higher than the baseline (approximately 3.5%), while the high scenario produces damages that are significantly higher than the baseline (approximately 39.1%). 3.4 Beach fx FWOP Simulation Conclusion The future without project condition simulated here suggests that the study area may be subject to considerable storm and erosion damage throughout the period of analysis. In particular, there are three important conclusions: 1.) Most of the FWOP damages consist of new armor construction for maintaining and protecting condominiums. 2.) The overwhelming majority of the damage and new armor is caused by erosion. 3.) Damages in the future without project condition increase in the accelerated sea level rise scenarios 4 Future With Project (FWP) Conditions As noted in Section 1.1, the purpose of the 934 Report is to investigate and evaluate the feasibility of extending the period of Federal participation for the authorized project to a full 50 years. In this case, a full 50 years would add 27 years to the project life, from 2018 through In order to evaluate the additional 27 years of Federal participation, a future with project (FWP) condition must be developed in Beach fx to compare to the FWOP. The purpose of this section is to describe the methods, assumptions, and results of the FWP modeling effort. 23

24 4.1 Existing Federal Project As noted above and in Section 1, the Jupiter Carlin project was constructed in 1995 and renourished in The authorized project provides for initial construction and periodic nourishment at seven year intervals along 1.1 miles of Atlantic shoreline with a seaward extension of approximately 100 feet from the mean high water (MHW) line and a berm elevation of 10 feet above mean low water. The design template is a 0 foot berm extension of the 1990 MHW line. Figure 17 shows a generalized cross section view of the project. Figure 8: Jupiter Carlin Project Profle Comparison 4.2 Optimization of Federal Project The purpose of the 934 Report is to evaluate the feasibility of continued Federal participation throughout an additional 27 years of analysis ( ). Unlike a full feasibility study, a full suite of potential alternatives has not been considered. However, planning guidance does have a provision for optimization of the Federal project, including a modification of the berm width and the renourishment interval to make it more efficient. Therefore, in order to optimize the project, different FWP conditions were developed within Beach fx. Specifically, a whole range of different advance fill widths were simulated: 20 feet to 100 feet (in ten foot increments). Changes to the design berm were not evaluated. Other FWP nourishment specifications, all of the modeling assumptions and parameters are the same in the FWP condition as they were in the FWOP condition. It should be noted that the alternative comparison is based on screening level mobilization and placement cost estimates. These estimates should be considered rough order of magnitude costs (ROM costs). Once the project is optimized in Beach fx, a refined cost estimate can be developed. 24

25 4.3 Comparison and Evaluation of the initial array of alternatives In order to identify the most efficient plan, an initial array of alternatives was developed that included a full range of variations in the advance fill, from 10 feet to 100 feet. The results of the preliminary screening is provided below in Table 9. Table 9: Alternative comparison using screening level costs 1st Screening (AAEQ Dollars) Benefits Cost BCR Net Benefits 10ft $946,391 $2,181, $1,234,760 20ft $964,812 $1,936, $971,338 30ft $995,902 $1,921, $925,311 40ft $996,643 $1,955, $958,635 50ft $995,710 $2,030, $1,034,516 60ft $988,722 $2,134, $1,146,150 70ft $984,359 $2,233, $1,249,470 80ft $983,980 $2,344, $1,360,699 90ft $983,081 $2,455, $1,472, ft $986,916 $2,553, $1,566, ft $970,681 $2,666, $1,696, ft $969,154 $2,778, $1,809,572 The preliminary screening suggested that none of the alternatives would be economically justified based on primary benefits alone. However, the smaller variations of the project appeared to more promising (i.e., closer to economic justification). For any alternative larger than 40 feet, the net benefits become increasingly negative with increasing project size. Therefore, the first four alternatives in the initial array (10 feet to 40 feet) were carried forward to the final array. 4.4 Alternative Comparison and Evaluation of the Final Array Ultimately four different variations of the authorized project were included in the Final Array and simulated in Beach fx with full 100 iteration runs. The results of this analysis are summarized in the below table. It should be noted that for Alternative 1, the total volumes of future resnousihsments would be small enough that a different construction method, truck haul delivery of sand, could be used (as opposed to dredging). As a result of this change the costs of Alterative 1 are somewhat less than previously estimated. Table 10: Final Array Alternative comparison using screening level costs Alternative Berm Annual Width Benefits Annual Cost Net Benefits 1 10ft $946,391 $1,670,189 $723, ft $964,812 $1,784,456 $819, ft $995,902 $1,964,581 $968, ft $996,643 $2,165,180 $1,168,537 *Average Annual Costs and Benefits computed at the FY17 water resourced discount rate (2.875%). 25

26 Of the alternatives analyzed, none of them appear to economically justified with primary benefits alone (damage reduction and land loss). However, three of them have a BCR greater than 0.5 with, which indicates that they could be justified when incidental benefits (recreation) are included. Recreation visitation numbers are large in the study area, and recreation benefits were a significant portion of total benefits in the authorizing document. Of the alternatives analyzed, the alternative that closest to justification is Alternative 1. It the highest BCR and the lowest magnitude of negative net benefits. It also has the lowest overall cost. Therefore, it has been selected as the Tentatively Selected Plan (TSP). 5 Tentatively Selected Plan As noted in Section 4.2, the TSP is a modified version of the authorized project extended through a full 50 year period of analysis (2046). The project template is smaller than the authorized project (including the 10 foot advance fill extension beyond the design berm), as is the average fill density (approximately 108 cubic yards per linear foot). The renourishment interval has also been optimized through the Beach fx analysis. Rather than seven years, the optimized renoursihment interval is five years. Based on the Beachfx analysis, the average number of renourishment events throughout the remaining period of analysis is five: 2018, 2023, 2028, 2032, and Beach fx analysis suggests that this modified version of the project would be the most efficient plan and have the greatest net benefits. The purpose of this section of the report is to describe the recommended plan in more detail, including refined costs, net benefits, and project performance. As noted in Section 2, the total average annual damage in the FWOP condition was estimated to be. In the FWP project, the total is 754,215, indicating that the TSP is expected to reduce about 56% of total damage and cost. A breakout of the FWP damages is provided in Table 11. A visual representation of the damages over time is provided in Figure 10. Table 11: Damages in the FWP condition Damages Armor Costs Land Loss Damages + Armor Cost + Land Loss Updrift Reach $0 $0 $158, $158,020 Project Reach $47, $395,953 $0.00 $443,262 Downdrift Reach $132, $0 $20, $152,933 Total $179,363 $395,953 $178,899 $754,215 26

27 Figure 9 Damages and Costs over time $1,800,000 Damages and Armor Cost incurred over Time in Constant Dollars $1,600,000 $1,400,000 $1,200,000 $1,000,000 $800,000 $600,000 $400,000 $200,000 $ Damages Armor Cost Land Loss 5.1 Project Performance in the SLR scenarios As noted in Section 4, Corps guidance requires the analysis of three sea level scenarios. Therefore, it is important to consider the performance of the selected plan in these scenarios. Most of the information in this document describes results associated with baseline SLR scenario (SLR1). A sensitivity analysis was conducted in Beach fx for the other two SLR scenarios. For the 60 foot project, the SLR Beach fx analysis results are summarized in the below table (Table 12). Table 12: Project Performance of the Recommended Plan in the SLR scenarios SLR2 (Intermediate) SLR3 (High) AAEQ FWOP Damage $1,797,536 $2,415,896 AAEQ FWP Damage $611,674 $670,980 AAEQ Benefits $1,185,862 $1,744,916 AAEQ Cost $2,509,797 $2,916,832 AAEQ Net Benefits ($1,323,935) ($1,171,916) BCR

28 The results indicate that while the FWOP damages increase in the accelerated SLR scenarios, the benefits and costs also increase. Of the three scenarios analyzed, none of them appear to economically justified with primary benefits alone (damage reduction and land loss). However, two of the three (including the baseline) have a BCR greater than 0.5 with, which indicates that they could be justified when incidental benefits (recreation) are included. The only scenario that appears to have a BCR less than 0.5 is the Intermediate scenario. In this case, annual benefits only increase slightly, but annual costs increase significantly. 5.2 Refined Costs of the Recommended Plan After a plan is selected, a fully refined cost estimate can be developed. The alternative comparison used screening level costs, which should be considered rough order of magnitude estimates. The fully refined cost estimate includes a number of other costs, including PED, construction management, and a cost contingency. As a result of these factors, the fully developed cost of the recommended plan is much higher than the screening level estimate. Table 10 summarized the refined costs. The estimates assumes an initial construction events: 2019, and four additional renouishment evets: 2019, 2023, 2028, 2033, and A summary of the refined project cost is provided in the table below. More information about the cost estimate is provided in the cost appendix. Table 13: Refined Project Costs for the Recommended Plan Construction Cost (mobilization and placement) $21,954,000 Lands and Damages $153,000 Preconstruction, Engineering, and Design (PED) $3,701,000 Construction Management $1,150,000 Subtotal $26,958,000 Contingency $7,240,000 *Costs reflect the grand total for all renourishment events. Total Project Cost $34,198, Economic Cost of the Recommended Plan The Economic cost of the project must also account for the time value of money. Per planning guidance, the costs and benefits of the NED Plan should be compared in average annual equivalent (AAEQ) terms. It should be noted that, in this case, interest during construction (IDC) is not applicable because the project has already been constructed and is already generating benefits. The total economic cost of the recommended plan is summarized in Table 14. Table 14: Economic Costs of the Recommended Plan Total First Cost $34,198,000 IDC $0 Total Investment Cost $34,198,000 Present Value of Investment Cost $18,109,287 AAEQ of Investment Cost $799,360 28

29 5.3 Benefits of the Recommended Plan Storm Damage Reduction Benefits The recommended plan prevents about 56.6% of the without project damages. This reduction is the source of primary project benefits. The benefits are summarized in Table 12. Table 15: Storm Damage Reduction Benefits of the Recommended Plan AAEQ Damages FWOP $1,521,707 AAEQ Damages FWP $575,316 AAEQ Benefits (damages reduced) $946, Land Loss Benefits Typically, in shore protection studies, prevention of land loss is also part of the primary project benefits. These benefits arise from preventing permanent loss of the upland (areas landward of the existing dune). Upland has economic value, as it is the location of current and future development (residential, commercial, etc). Beach fx estimates net shoreline changes over time, including changes to the upland width. However, as noted in Section 2, many lots are defined as currently armored or amorable in the future. The armor prevents erosion damage to the upland in both the FWOP and FWP conditions. Therefore, land loss benefits do not apply to some of the lots. For the remaining lots, land loss benefits have been computed. The land loss benefits of the Recommended Plan are summarized below. Table 16: Storm Damage Reduction Benefits of the Recommended Plan AAEQ Value of Land Lost FWOP $215,482 AAEQ Value of Land Lost FWP $178,899 AAEQ Benefits (damages reduced) $36, Incidental Recreation Benefits According to ER , incidental recreation benefits can be calculated in shore protection studies. While recreation benefits cannot make up more than 50% of the total benefits needed for project justification, the guidance states that if the criterion for participation is met, then all recreation benefits are included in the benefit to cost analysis. Additionally, ER specifies that benefits arising from recreation opportunities created by a project be measured in terms of willingness to pay. Three acceptable calculation methods are outlined: (a) the travel cost method (TCM), (b) the contingent valuation method (CVM), and (c) the unit day value method (UDV). The unit day value method estimates a user s willingness to pay for a given recreational opportunity by assigning ratings to five criteria designed to measure the quality of the overall recreation experience provided in the project area. According to ER Appendix E, UDV may be used to account for visitations of up to 750,000 per year. Historical data provided by Palm Beach County lifeguard counts reported visitations to the public parks at the northern and southern extents of the project area as 29

30 706,860 in The average growth rate between 2010 and 2016 was 2.03% annually, leading to an estimated 750,793 visitations by 2019 (the project base year). Due to the efficiency of the UDV method, the method was selected and visitations were capped at 750,000 throughout the period of the analysis. Such a conservative visitation estimate means that recreation benefits are likely understated. As mentioned above, the UDV method uses five criteria to gauge the overall quality of the recreation experience, availability, carrying capacity, accessibility, and environment in the project area. Each criterion can be assigned to one of five possible scoring ranges rated from low to high. Within each range a specific point value is also chosen. These point values are summed together and applied a dollar day value based on the current UDV guidance. The current unit day values, provided by USACE Economics Guidance Memo #17 03, Unit Day Values for Recreation for Fiscal Year 2017 (25 October 2016), are presented in Table 17. Linear interpolation was used to estimate the dollar value of point scores not published. For example, a point score of 2 corresponds with a dollar value of $4.11. Table 17: Current Unit Day Values for Recreation (FY17) Point Values General Recreation Values (FY17) 0 $ $ $ $ $ $ $ $ $ $ $ The point assignments are based on qualitative criteria and depend on best professional judgment (also referred to as judgment criteria ) and knowledge of the project area. In order to learn more about recreation in Palm Beach County s (PBC) Jupiter Carlin segment, SAJ economists met with members of PBC, Department of Environmental Resources Management on February 9, This collaboration helped in the assignment of the following judgment criteria applied to the project footprint. Recreation Experience: A score of 16 representing several general activities: one high quality value activity was assigned to the future with project condition in 2020 (the year after the initial beach nourishment) and held constant throughout the remaining period of federal participation (through 2045). In the without project condition, the assigned score starts at 14 in the project base year (2019) but drops to 8 over the planning time horizon, which is the low end of Several general activities. In both the future with and without project conditions, surfing, paddle boarding, surf fishing, snorkeling, and sunbathing are general activities occurring in the study area. The quality of on beach activities enjoyed by families, such as sunbathing and playing games, is expected to improve in the with project condition compared to the without project condition due to the difference in the size of sandy beach area available for recreation between the two scenarios. The combined berm and dune 30

31 area derived from the Beach fx LandLoss.csv file compared for the with and without project conditions shows a significant difference in beach size in the two scenarios. The construction of armor as modeled by Beach fx also reduces the quality of recreational activities in certain areas and signals that there is likely no dry beach at high tide. Table 18 below shows a comparison of armoring in the with and without project conditions. In addition to the general beachside activities described above, the Jupiter Civic Center, a municipal venue of the Town of Jupiter, is currently a significant destination for weddings and other special occasions (e.g., birthday parties, etc.) located in the study footprint. The venue is available for rental. The occurrence of on beach weddings and parties at a venue operated by a municipality, rather than by a privately owned entity such as a resort, is not common to the region and can thus be considered a high quality value activity within the study area. The without project rating of 8 assumes that the beach will erode to a point that prevents the use of the Civic Center as a venue for special events. Beach fx results suggest that this will occur by 2026, the average year in which the Civic Center becomes armored in the without project condition. Based on armoring results for the future with project condition, the Civic Center is unlikely to become armored if a project is implemented, which preserves on beach events held at the Civic Center as high quality recreational activities. See Table 18. Table 18: Armor Construction in Project Footprint from ArmorStatus.csv Beach fx output file. Reach/Lot # of Iterations Armor Built FWOP Average Year Armor Built 10ft (TSP) # of Iterations Average Armor Built Armor Built JC15 1 Ocean Trail Condos N Ocean Trail Condos N JC16 1 Jup Bch Resort Ocean Trail Condos S Ocean Trail Condos S JC18 1 CP Civic Center Year Availability of Opportunity: Both the with and without project conditions were assigned scores within the several within 1 hr. travel time; a few within 30 minutes because several other beaches with public access are available within close proximity (< 30 minutes to 1 hour) of Jupiter Beach, including Juno Beach, Palm Beach, and the southern Palm Beaches, which are all located within Palm Beach County. A score of 1 was maintained throughout the period of analysis in both the FWP and FWOP. Carrying Capacity: The study area currently has all of the parking and public access facilities necessary to conduct recreational activities at site potential. Facilities include public restrooms, picnic pavilions, free public parking, and manned lifeguard stations. In Carlin Park (southern end of study area) and 31

32 Jupiter Beach Park (northern end of study area), swimming areas are guarded year round, seven days a week, from 9:00 am to 5:20 pm (from Aquatics/Beaches.aspx). Based on the current facilities, the project area was assigned a point value of 10, optimum facilities to conduct activity at site potential in the project base year in both the with and without project conditions. The FWP rating is expected to be held at 10 throughout the project life as the project will allow for the high quality current facilities to be maintained. However, over time in the FWOP, one would expect at least some public restrooms, pavilions, dune crossovers, and other facilities in the study area to deteriorate due to erosion and associated flooding. Such deterioration affects the quality of the available facilities and could also affect whether the facility can be used at all, resulting in recreation score falling to 5 within the Basic facility to conduct activity(ies) category. Accessibility: Currently, the study area has good access, good roads to site; fair access, good roads within site (11 to 14 scoring range). A1A/Ocean Boulevard and Ocean Trail Way provide access to the study area. There is adequate, free public parking, and dune crossovers allow access from Carlin Park and Jupiter Beach Park parking lots to the beach. Within the proposed project footprint, there are times when there is little to no berm space for people to walk along the beach without getting their feet wet. The stretch between R monuments 15 and 18 tends to be the most erosional area, and there are many rock outcroppings that impede people s ability to take beach walks, especially at high tide. Due to the rock outcroppings that make walking along certain areas of the beach difficult and the vulnerability of dune crossovers to damage from erosion, a score starting at 13 and dropping to 11 within the Good access, good roads to site; fair access, good roads within site category was assigned to the study area in the FWOP condition. In the FWP condition, beach nourishment would construct the berm such that the rock outcroppings would be covered, and thus access within the site would go from fair to good. Damage to dune crossovers would also be reduced when compared to the FWOP condition. Thus, a score of 15 was assigned to the FWP study area, which is the lowest end of the Good access, high standard road to site; good access within site category. Environmental Quality: Loggerhead sea turtle nesting is common to the area and sea turtle walks officially permitted by the Florida Fish and Wildlife Conservation Commission are available through the Loggerhead Marine Life Center at Juno Beach (outside of the study area) and are promoted as an area attraction by the Jupiter Beach Resort (within the study area). Some of the highest nesting densities in the region occur throughout the project area north to Coral Cove. While sea turtles will nest regardless of berm width, a smaller berm (or no berm in certain parts of the study area) hurts nesting success rates and nesting densities (from Palm Beach County, Department of Environmental Resources Management). The project would also provide protection to dune vegetation (sea grapes, etc.). The Beach Jacquemontia (Jacquemontia reclinata), a rare species of flowering plant endemic to the southeastern coast of Florida (mainly within the South Florida metropolitan area) which has a status of Endangered at both the federal and state (Florida) levels, is found near R monument 17 within the study area. It is a back dune species, so its survival/success can be affected by erosion. In the base year a score of 12, high aesthetic quality; no factors exist that lower quality, was assigned to the without project study area. Over the project life, this score is expected to drop to 5 in the Average aesthetic quality; factors exist that lower quality to a minor degree category. Little to no flat, traditional recreational berm would exist in the FWOP condition and, as detailed above, plant and animal habitats in the area would be adversely affected, all of which are factors that lower 32

33 environmental quality in some way. Considering erosion of the dune during past storm events, dune erosion could also be a concern if the project is not implemented. In the FWP condition, the score increases to 15, or the high end of the High aesthetic quality, no factors exist that lower quality due to the high sea turtle nesting densities and plant life. Additionally, if a project is implemented, then the study area would be much more self sustaining than without the project in the case of coastal storms. The recreation point values assigned to the Jupiter Carlin project area vary by year and between the with and without project scenarios. They are summarized in Table 19 and Table 20. Table 19: Total Unit Day Point Scores Applied to Jupiter Carlin *Base year is 2019 Table 20: Unit Day Point Scores by Category Applied to Jupiter Carlin Year Recreation Experience Year Without Project With Project Availability of Opportunity Carrying Capacity Accessibility Environmental Quality FWOP FWP FWOP FWP FWOP FWP FWOP FWP FWOP FWP Using the scores described above and applying the visitation cap of 750,000 visitors per year results in an estimated total present value of recreation benefits of approximately $28,392,000, or $1,526,000 in average annual terms. 5.4 BCR and Net Benefits of the Recommended Plan The net benefits of the recommended plan incorporate both the costs and benefits of the project. The below table (Table 21) provides a summary. Average Annual costs and benefits have been computed at 33

34 FY17 price levels and at the FY17 water resources discount rate (2.875%). A graphical summary of the costs and benefits is provided in Figure 11. Table 21: Economic Summary of the Recommended Plan Total Cost $34,198,000 Interest During Construction (IDC)* $0 Total Investment Cost $34,198,000 AAEQ of Investment Cost $1,546,000 AAEQ Damage Reduction Benefits $946,000 AAEQ Land Loss Benefits $37,000 AAEQ Recreation Benefits $1,526,000 AAEQ Total Benefits $2,509,000 AAEQ Net Benefits $963,000 Benefit Cost Ratio (BCR) 1.62 *Because the project has already been constructed, there is no interest during construction; IDC is zero for continuing construction of projects that are already generating benefits. Figure 10 Jupiter Carlin 934 Report: Overall Economic Summary THOUSANDS $7,000 $6,000 $16,000 $14,000 THOUSANDS $5,000 $12,000 $10,000 PV DAMAGES $4,000 $3,000 $2,000 $8,000 $6,000 $4,000 PV FWP COSTS $1,000 $2,000 $ FWOP FWP FWP Cost $0 34

35 5.5 Conclusion and Recommendations The economic analysis in this report confirms that continued Federal participation in the Palm Beach County, Jupiter Carlin coastal storm risk management project is economically justified. In accordance with planning guidance and the stated purpose of a 934 report, an optimized version of the authorized project is the recommended plan. The optimized plan has positive net benefits and a benefit cost ratio above unity. The plan is very similar to the constructed project, though the advance fill size is smaller and the recommended renourishment interval is less frequent (approximately once every five years). 6 Addendum A: Alternate Modeling Approach As noted in Section 3.1, the modeling approach used in the economic analysis assumed the same starting shoreline position for both the FWOP and FWP project conditions. This approach makes a valid comparison possible between the two conditions. However, it is not fully consistent with the Section 934 guidance, which states that the starting shoreline used in the FWOP analysis should reflect the preconstruction template. In this case, the pre construction template would be the 1995 shoreline before initial construction of the project. Between 1995 and 2015 both the shoreline position and physical orientation changed significantly. Because of these changes, it is not possible to make valid comparison by using the pre project shoreline. However, the starting shoreline assumptions described in the guidance was modeled in Beach fx as an alternate approach. The results of this analysis suggest that strict application of the 934 guidance leads to illogical Beach fx model results, i.e., more armor costs being triggered in a FWP then in a FWOP condition in some reaches. The Beach fx model was developed to compare an existing FWOP shoreline with a proposed FWP shoreline, where the FWP shoreline is achieved by placing the project (additional dune and/or berm material) on top of the existing (FWOP) shoreline. At Jupiter Carlin the FWOP and FWP initial shorelines were so spatially different that attempting to compare them lead to the illogical comparison results. 35

36 Armor Costs Incurred for Model Reach JC15 1 Initial construction begins in late 2019 $900,000 $800,000 $700,000 $600,000 $500,000 $400,000 $300, $200,000 $100,000 $ FWOP 1995 Shoreline FWOP Current Shoreline FWP Current Shoreline Figure 1A: Representation of illogical armoring costs incurred for Reach 15 The model results were interrogated to observe the distribution of damages over space and time relative to project construction. Figure 1A shows the armor cost incurred over time for model reach JC15 1 in constant dollars. Because the shoreline was in a less eroded condition in 1995 when compared with current conditions for this particular model reach, armor is not triggered until In contrast, under current conditions armor is triggered in Construction of the project eliminates any further incidence of damage throughout the life cycle, which is what one would expect to see. Use of the 1995 shoreline for the FWOP condition effectively results in the illogical assessment that the construction of a project caused armor to be triggered in 2019 rather than And it is impossible to determine whether differences between with and without project conditions were due to the alternative being modeled or due to the different position of the shoreline. 1. TSP Sensitivity Analysis For comparison purposes however, an analysis based on using the pre construction shoreline as the FWOP starting point was conducted. Under this scenario, the TSP remains the same, although there is a slight reduction in benefits, mostly due to reduction in the amount of armoring costs avoided. 36