The Cost-Benefit Group, LLC News

Link: http://benefitcostanalysis.org/events/2011-conference-agenda

Kenneth Acks, CEO of the Cost-Benefit Group, LLC will chair a session and present a paper at the Fourth Annual Conference and Meeting of the Society for Benefit-Cost Analysis.

The conference, entitled "Expanding the Scope of Benefit Cost Analysis: Practical Applications and Analytical Frontiers" will be held at the L'Enfant Plaza Hotel in Washington, D.C. from Friday October 21st through Saturday October 22, 2011.

The Conference will continue the focus of past conferences on the practical use of Benefit-Cost Analysis (BCA) in a variety of institutional and national settings, with special attention to the role of BCA in both prospective and retrospective program evaluation; and to broadening and improving measurement of benefits and/or costs. As in past years, the conference will convene a large number of guests, including researchers, and practitioners working in academia, nonprofits, businesses, and government around the world. The annual membership meeting of the Society will be held during lunchtime on October 22.

Registration and general conference information is available at http://benefitcostanalysis.org/events/2011-conference-and-meeting-society-benefit-cost-analysis. The full agenda is available at http://benefitcostanalysis.org/events/2011-conference-agenda

Ken Acks will present the paper "Estimated Costs and Benefits of one Thousand Green Roofs in New York City" at the Panel 14 session: "Alternative Energy, Green Roofs, and BCA in the Netherlands" on Saturday October 22nd from 1:30 PM - 3:00 PM in the Renoir Room. The abstract follows:

In this paper we develop a model designed to estimate and tally the private and social costs and benefits of installing green roofs in New York City. Model inputs include baseline data on roof areas and other parameters, and variable assumptions reflecting high, medium, and low green roof performance scenarios with respect to various cost and benefit parameters. Key cost and benefit components estimated include: installation costs (generally higher for green roofs); service lives (greater for green roofs); architecture and engineering costs; maintenance costs; energy used for cooling; the urban heat island effect; Stormwater runoff operating costs and capital expenditures; potential economies of scale for installation and maintenance costs; administrative costs; sound reduction; aesthetic benefits; potential greenhouse gas reduction; air pollution reductions; food production and recreation. Costs and Benefits will also be compared to painted white roofs and installation of solar panels. Sensitivity analyses will consider the role of scale, and uncertainty of various estimated benefits.

Other papers in the panel are: "A Model for the Financial and Economic Analysis of Wind Farms For Electricity Generation with Application to Santiago, Cape Verde by Sener Salci, Graduate Student, Department of Economics, University of Birmingham, UK and Glenn P. Jenkins, Professor, Department of Economics, Queen’s University, Canada and Eastern Mediterranean University, North Cyprus and "The Practice of Valuing the Environment in Cost-Benefit Analysis by Jan Anne Annema, Assistant Professor, Transport Policy, Delft University of Technology (Presenter) Carl Koopmans, Professor, VU University, Amsterdam.

Mr. Acks will moderate Panel 5: "Air/Water Pollution" in the Renoir Room from 4:30 - 6:00 PM on Friday October 21, 2011 which will feature the following papers:

** "Does Electronic Reporting of Emissions Information Generate Environmental Benefits?"
by Ron Shadbegian, Senior Economist, U.S. Environmental Protection Agency National Center for Environmental Economics (Presenter); Ann Wolverton, Senior Economist, U.S. Environmental Protection Agency National Center for Environmental Economics; and Wayne Gray, Professor, Clark University
** "Uncertainty and Estimates of the Benefits of Reducing Fine Particle Pollution" by Randall Lutter, Visiting Scholar, Resources for the Future and Art Fraas, Visiting Scholar, Resources for the Future
** "The Cost-Effectiveness of Alternative Approaches to Residential Radon Control" by Erik Johnson, Assistant Professor of Economics, Georgia Institute of Technology (Presenter); Paul Courant, Harold T. Shapiro Collegiate Professor of Public Policy Professor of Economics and of Information, University of Michigan; David Mendez, Associate Professor, University of Michigan and Kenneth Warner, Avedis Donabedian Distinguished University Professor of Public Health, University of Michigan
** "Reference-Dependent Valuations of Environmental Health Risks" W. Kip Viscusi, Distinguished Professor of Law, Economics, and Management, Vanderbilt University (Presenter) and Joel Huber, Schwartz Professor of Marketing, Fuqua School of Business, Duke University

Despite weaknesses in the real estate market and the economy the Cost-Benefit Group obtained and completed a variety of challenging assignments. Unfortunately much of this work involved litigation support, foreclosures, estates or dispute resolution rather than the production of new and better goods and service for the economy. We cannot disclose some of our work at this time and have eliminated details of other projects due to confidentiality agreements. We may be able to provide additional details upon request. The work for these projects included valuations, feasibility studies, forecasts and/or analyses of real estate markets, local economies, neighborhoods, zoning, taxes, and real estate sales and rental activity.

Projects include:

Vacant land - Bushwick, Brooklyn, NY
Mixed-use retail/office building - Sayville, NY
Mixed-use retail/residential building - Port Washington, NY
Mixed-use retail/residential building - Midtown West, Manhattan, New York
Mixed-use retail/residential building - Ridgewood Queens, Manhattan, New York
Apartment building - Queens Village, Queens, NY
Marina - Oceanside, NY
Flex industrial/office building - Hauppauge, NY
Contaminated residences - New Paltz, NY
Contaminated residence - Nassau County, NY
Contaminated residence - Carmel, NY
Two auto repair garages - Glendale, Queens, NY
Laundromat - Glendale, Queens, NY
Small retail store - Ridgewood, NY

Link: http://www.webmeets.com/aere/2011/Prog/

From the Conference Committee:

We are happy to inform you that your paper, A COST-BENEFIT ANALYSIS OF AN OUTERBOROUGH GREEN MIXED-USE BROWNFIELD REDEVELOPMENT PROJECT IN NEW YORK CITY (Reference No: 472), has been accepted for presentation at the inaugural AERE Summer Conference that will be held at the Seattle Renaissance Hotel, June 8th - June 10th 2011. We received more than 550 submissions and the selection process has been highly competitive

The conference will expand upon the AERE workshop format to include up to 12 parallel sessions and 375 attendees. With generous support from sponsors, the conference will also include a sponsored session related to the topic "Metropolises, Urbanization, and the Environment," with keynote speaker Edward Glaeser of Harvard University, as well as many sessions related to any topic of interest.

The conference program can be found at http://www.webmeets.com/aere/2011/Prog/

Note: due to a scheduling conflict Mr. Acks had to withdraw the paper.

Despite weaknesses in the real estate market and the economy the Cost-Benefit Group obtained and completed a variety of challenging assignments. Unfortunately much of this work involved litigation support, foreclosures, estates or dispute resolution rather than the production of new and better goods and service for the economy. We cannot disclose some of our work at this time and have eliminated details of other projects due to confidentiality agreements. We may be able to provide additional details upon request. The work for these projects included valuations, feasibility studies, forecasts and/or analyses of real estate markets, local economies, neighborhoods, zoning, taxes, and real estate sales and rental activity.

Projects include:

Vacant commercial land developed with a bank branch - Amityville, NY
Vacant golf course with proposed residential development - Dix Hills, NY
Vacant commercial land with proposed shopping center development - Dix Hills, NY
Vacant land - Arverne, Queens, NY
Vacant commercial building - Huntington Station, NY
Religious Building - New Hyde Park, NY
Mixed-use retail/residential building - Port Washington, NY
Complex of industrial buildings - Freeport, NY
Flex industrial/office building - Hauppauge, NY
Supermarket - Cobble Hill, Brooklyn, NY
Supermarket - South Bronx, NY
Restaurant - Astoria, Queens, NY
Mixed use industrial/retail building - Jamaica, NY
Commercial building - Amaganset, NY
Commercial building - Rockville Centre, NY
Industrial Building - Huntington, NY
Contaminated residence - New Paltz, NY
Contaminated residence - Nassau County, NY

Reports and testimony regarding effects of Chinese drywall in Louisiana, Virginia Beach and Williamsburg Virginia;

Kenneth Acks, CEO of the Cost-Benefit Group, LLC prepared a report and testified on the impact of Chinese Drywall in testimony presented before United States District Judge Eldon E. Fallon in New Orleans.

Mr. Acks inspected the homes and prepared extensive reports on impacts of drywall on homes in Williamsburg and Virgina Beach Virgina and in Louisianna, including discussions of the economy and real estate markets in these areas and conducted a contingent valuation study.

Judge Fallon recognized Mr. Acks as an expert in the valuation of environmental damages to real estate.

Within 24 hours of being contacted the Cost Benefit Group, produced a 12-page report on the Effect of Potential Superfund (NPL) Designation of the Gowanus Canal upon Nearby Property Values for Toll Brothers; Sive, Paget & Reisel; and Environmental Liability Management.

The Gowanus Canal, located in northwest Brooklyn, New York is connected to the Gowanus Bay in Upper New York Bay. The canal borders the neighborhoods of Red Hook and South Brooklyn to the west and Carroll Gardens to the east.

Kenneth Acks directed the research which reviewed the literature on the effects of potential Superfund designation upon property values, and determined that the evidence indicates that Superfund designation will generally increase risk associated with a site and surrounding properties -- and thus diminish property values. The designation will reduce values beyond diminution levels expected from the contamination absent placement on the list. The report also noted that the current economic crisis increases the likely diminution from Superfund designation. In a buyers’ market developers and homebuyers will be able to easily find properties at affordable prices that do not face the risks posed by Superfund designation. In addition, risks tend to be multiplicative, and the combination of greater financial risk, market risk, economic risk, environmental risk and regulatory risk is likely to prove devastating.

The Gowanus neighborhood was originally a tidal inlet of navigable creeks in original saltwater marshland and meadows. The first gristmill patented in New York was built in Gowanus after1635. On May 29, 1664, several residents were granted permission to dredge a canal at their own expense in order to supply water to run the mill.

In 1849, the New York Legislature authorized the construction of the Gowanus Canal by deepening Gowanus Creek, to transform it into a mile and a half long commercial waterway connected to Upper New York Bay. After exploring numerous alternative (and some more environmentally sound) designs, the final was chosen for its low price tag. The canal was essentially complete by 1869.

Despite its relatively short length, the Gowanus Canal was a hub for Brooklyn's maritime and commercial shipping activity. Factories, warehouses, tanneries, coal stores, and manufactured gas refineries sprang up as a result of its construction. Much of the brownstone quarried in New Jersey and the upper Hudson was placed on barges with lumber and brick and shipped through the canal to build the neighborhoods of Carroll Gardens, Cobble Hill, and Park Slope. In addition, the industrial sector around the canal grew substantially over time to include: stone and coal yards, flour mills, cement works, and manufactured gas plants, tanneries, factories for paint, ink, and soap, machine shops, chemical plants, and sulfur producers, all of which emitted pollutants.

Thriving industry brought many new people to the area but important questions about wastewater sanitation had not been properly addressed to handle such growth. All the sewage from the new buildings drained downhill, into the Gowanus. The building of new sewer connections only compounded the problem by discharging raw sewage from neighborhoods even farther away into the Canal. By the turn of the century, the combination of industrial pollutants and runoff from storm water, fortified with the products of the new sewage system, rendered the waterway a repository of rank odors, euphemistically called by wise-cracking locals "Lavender Lake". After World War I, with six million annual tons of cargo produced and trafficked though the waterway, the Gowanus Canal became the nation's busiest commercial canal.

The US Army Corps of Engineers completed their last dredging of the canal in 1955 and soon afterward abandoned their regular dredging schedule, deeming it to be no longer cost effective.

In 2002, the U.S. Army Corps of Engineers entered into a cost-sharing agreement with the DEP to collaborate on a $5 million Ecosystem Restoration Feasibility Study of the Gowanus Canal area to be completed in 2005, studying possible alternatives for ecosystem restoration such as dredging, and wetland and habitat restoration. The DEP also initiated the Gowanus Canal Use and Standards Attainment project, to meet the City's obligations under the Clean Water Act.

Toll Brothers has vowed to abandon plans to build 460 condos and townhouses along the waterway if it becomes a Superfund site, saying the stigma attached to the program will make it impossible to finance the project or sell the homes.

Shortly after the report was issue Mayor Michael Bloomberg came out against Superfund Designation (We have no evidence, however, of a causal connection, or even that Mayor Bloomberg saw the report).

According to an April 20, 2009 press release (http://www.tollbrothers.com/homesearch/servlet/HomeSearch?app=IRhome) Toll Brothers, Inc. is the nation's leading builder of luxury homes. The Company began business in 1967 and became a public company in 1986. Its common stock is listed on the New York Stock Exchange under the symbol "TOL". The Company serves move-up, empty-nester, active-adult and second-home home buyers and operates in 21 states: Arizona, California, Colorado, Connecticut, Delaware, Florida, Georgia, Illinois, Maryland, Massachusetts, Michigan, Minnesota, Nevada, New Jersey, New York, North Carolina, Pennsylvania, South Carolina, Texas, Virginia and West Virginia. It was ranked #1 in five of the nine rating categories among Home Builders in Fortune magazine's recently released list of World's Most Admired Companies 2009.

According to its website Sive, Paget & Riesel (http://www.sprlaw.com/thefirm/index.html) has been a leader in Environmental Law and Litigation since the early 1960's. More than four decades ago, Sive, Paget & Riesel lawyers led the administrative and judicial proceedings that followed after the initial landmark Storm King Mountain litigation in New York's Hudson River region. Their attorneys also led the successful fight to stop the Hudson River Expressway, which resulted in an opinion that is the first reported decision contained in the Environmental Law Institute’s Environmental Law Reporter http://www.eli.org. The Storm King Mountain disputes preceded the first Earth Day in 1970, the enactment of the National Environmental Policy Act and the creation of the United States Environmental Protection Agency. Sive, Paget & Riesel continues to be a leader in this field, having been selected by two independent ranking agencies – Chambers and Partners USA and Who’s Who Legal – as the leading firm for environmental law and litigation in New York http://www.chambersandpartners.com/us/, http://www.whoswholegal.com.

According to their website Environmental Liability Management of New York, LLC (ELM - http://www.elmofny.com) is an environmental, engineering and risk management firm. ELM's professional staff has demonstrated expertise in assisting you in the management of multimedia environmental concerns. They combine in-depth regulatory knowledge along with project management expertise and technical insight to control costs while meeting in-house objectives, and obtaining any necessary agency approvals. ELM's services range from simple consultations to the management of day-to-day operations for multimillion dollar environmental compliance and remediation programs.

On March 12th a jury awarded about $150 million in compensatory damages to 91 households in Jacksonville Maryland due to a gasoline leak that occurred at a nearby Exxon Mobil Corp. gas station.

For emotional distress most adult plaintiffs in the suit received $500,000 in non-economic damages, plus $50,000 in non-economic damages for their children for emotional distress resulting in a total award of about $71 million. ExxonMobil was also held responsible for lifetime medical monitoring, which is expected to cost nearly$14.5 million.

Each family also received the full appraised value of their home resulting in total property damages of more than $61 million. The Maryland Daily Record reported “The fact that plaintiffs were, for the most part, compensated for the full value of their homes, some of them worth as much as $1.3 million, was surprising and cathartic to many homeowners.”

On December 30th and 31st 2008 Ken Acks CEO of the Cost-Benefit Group testified before the jury regarding the diminution in property values resulting from the underground gasoline storage tank leak. Jacksonville is an affluent community about 20 miles north of the City of Baltimore. The tank spilled about 26,000 gallons of gas over 37 days until it was discovered on February 16, 2006. Jury selection began October 1st 2008, and the trial started on October 14th. Several environmental and health experts, and most plaintiffs testified before Mr. Acks.

Mr. Acks directed the valuation estimates for 91 properties. As part of the process Richard Kern, SRA, a local appraiser, estimated property value as uncontaminated at the time of the spill, The average property value was determined to be about $690,000. Mr. Acks then used a variety of techniques to estimate expected diminution levels, based upon contamination probabilities provided by Whitman Associates and other environmental consultants, an extensive search of academic literature, surveys, interviews, investigations of real estate activity in the area, and other research..

Mr. Acks had been deposed over four days by attorneys for the defendant, ExxonMobil, in the year prior to the spill. Robert Weltchek a name partner at Snyder, Weltchek & Snyder, the attorneys for the plaintiffs, directed questions to Mr. Acks on December 30th. He then faced cross examination from attorneys for the defendant, and a redirect by Mr. Weltchek.

Mr. Acks has been assessing the economic impacts of environmental factors, conducting financial analyses, valuing real property, providing litigation support, and producing cost-benefit analyses for more than 30 years. He has estimated property damages from nuclear power plants, oil spills, dry cleaners and numerous toxic chemicals. In conjunction with the NASA-Goddard, Columbia University he produced a cost-benefit analysis of green roofs in New York City and presented a Cost-Benefit Analysis of a Green Brownfield Redevelopment Project at the Society for Benefit-Cost Analysis in June 2008.