posed improvement. Cost reduction benefits apply 

 in the following situations: 



(1) Same commodity, origin-destination, and 

 harbor. This situation occurs where commodities 

 now move or are expected to move via a given 

 harbor with or without the proposed improvement. 



(2) Same commodity and origin-destination, dif- 

 ferent tiarbor This situation occurs where commod- 

 ities that are now moving or are expected to move 

 via alternative harbors without the proposed im- 

 provement would, with the proposed plan, be di- 

 verted through the subject harbor. Cost reduction 

 benefits from a proposed plan apply to both new 

 and existing harbors and channels. 



(3) Same commodity and origin-destination, dif- 

 ferent mode. This situation occurs where commod- 

 ities that are now moving or are expected to move 

 via alternative land modes without the proposed im- 

 provement would, with the proposed plan, be di- 

 verted through the subject harbor or channel. Cost 

 reduction benefits from a proposed plan apply to 

 both new and existing harbors and channels. Com- 

 pute cost reduction benefits for alternate modes in 

 accordance with Section VI (See 2.6.2(e)). 



(b) Shift of origin benefits. If there is a change in 

 the origin of a commodity as a result of a proposed 

 plan but no change in destination, the benefit is the 

 reduction in the total cost of producing and trans- 

 porting quantities of the commodity that would 

 move with and without the plan. 



(c) Shift of destination benefits. If there is a 

 change in destination of a commodity as a result of 

 a proposed plan but no change in origin, the benefit 

 is the change in net revenue to the producer for 

 quantities that would move with and without the 

 plan. 



(d) Induced movement benefits. If a commodity 

 or additional quantities of a commodity are pro- 

 duced and consumed as the result of lowered 

 transportation costs, the benefit is the value of the 

 delivered commodity less production and transpor- 

 tation costs. More precisely, the benefit of each in- 

 crement of induced production and consumption is 

 the difference between the cost of transportation 

 via the proposed improvement and the maximum 

 cost the shipper would be willing to pay. Where 

 data are available, estimate benefits for various in- 

 crements of induced movement. In the absence of 

 such data, the expected average transportation 

 costs that could be borne by the induced traffic 

 may be assumed to be half way between the high- 

 est and lowest costs at which any part of the in- 

 duced traffic would move. 



2.7.3 Planning setting. 



The planning setting consists of the physical, 

 economic, and policy conditions that influence and 

 are influenced by a proposed plan or project over 

 the planning period. The planning setting is defined 

 in terms of a without-project condition and with-pro- 

 ject condition. 



(a) Without-project condition. The without-project 

 condition is the most likely condition expected to 

 exist over the planning period in the absence of a 

 plan, including any known change in law or public 

 policy. It provides the basis for estimating benefits 

 for alternative with-project conditions. Assumptions 

 specific to the study should be stated and support- 

 ed. The basic assumptions for all studies are: 



(1) Nonstructural measures within the authority 

 and ability of port agencies, other public agencies, 

 and the transportation industry determine changes 

 that are likely to occur. These measures consist of 

 reasonably expected changes in management and 

 use of existing vessels and facilities on land and 

 water. Examples are lightering, tug assistance, use 

 of favorable tides, split deliveries, topping-off, alter- 

 native modes and ports, and transshipment facili- 

 ties. 



(2) Alternative harbor and channel improvements 

 available to the transportation industry over the 

 planning period include those in place and under 

 construction at the time of the study and those au- 

 thorized projects that can reasonably be expected 

 to be in place over the planning period. 



(3) Authorized operation and maintenance is as- 

 sumed to be performed in the harbors and chan- 

 nels over the penod of analysis unless clear evi- 

 dence is available that maintenance of the project 

 is unjustified. 



(4) In projecting commodity movements involving 

 intermodal movements, sufficient capacity of the 

 hinterland transportation and related faciltities. in- 

 cluding port facilities, is assumed unless there are 

 substantive data to the contrary. 



(5) A reasonable attempt should be made to re- 

 flect advancing technology affecting the transporta- 

 tion industry over the penod of analysis. However, 

 the benefits from improved technology should not 

 be credited to the navigation improvement if the 

 technological change would occur both with and 

 without the plan. 



(b) With-project condition. (1) The with-project 

 condition is the one expected to exist over the 

 period of analyses if a project is undertaken. De- 

 scribe the with-project condition for each alternative 

 plan. Since benefits attnbutable to each alternative 



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