ECONOMIC JUSTIFICATION 



71. BENSFIT-COST COi'LPAcilSON 



The Fox Point barrier, the first unit to be constructed, 

 would have a benefit-cost ratio of 2.37 to 1.0. The benefit- 

 cost ratio for the Lower Hay barriers would range from 1.65 to 1.0 to 

 1.02 to 1.0. These ratios correspond to the range of first 

 cost of the LoTier i3ay barriers from -.?69,000,000 to tl09,000,'XO. 

 Average annual benefits of the two-unit plan are estimated at 

 s?6,000,000. The benefit-cost ratio for the plan as a whole 

 ranges from 1.22 to 1.0 to 1.3l to 1.0, as svu-unarized in Table 9. 



From another viewpoint, benefits of approximately f J?03,C)00.000 

 that would be attributable to the two-unit plan from one design 

 hurricane flood xTOuLd more than pay for construction of the project. 

 Of the total, ^78,000,000 would accrue to the Fox Point barrier 

 and the remaining i;i25jOOO,00'3 to the Lower Say barriers. 



TABLE 9 



ECONOi'EEC DATA OF PROPOSED FLAW, 



NAiiil.^fiANSETT BAY AR3A. 



(1956 price levels) 



Unit 



Average 



Benefit-Cost Ratio 



/mnual Average Annual Charges Lower Upper 



Benefits Minimum Maximum Limit Limit 



Fox Point ^1,733,000 $ 732,000 ?t 732,000 2.37:1.0 2.37:1.0 

 Barrier 



Lower Bay U, 267, 000 2,580,000 U, 167, 000 1.02:1.0 1.65:1.0 

 Barriers 



Total :s6, 000,000 ^3,312,000 ifU, 899,000 1.22:1.0 1.81:1.0 



PROPOSED LOG.U, COOPERATION 



72. Officials of the State of Rhode Island at the public 

 hearing on 1 October 1956 expressed the view that policies for 

 Federal financing of flood control projects should be applied 

 to hurricane flood protection projects, and have indicated their 

 willingness to participate on this basis in paying such costs as 

 land acquisitions, changes in local facilities and maintenance. 



6A 



