INITIAL REGULATORY IMPACT ANALYSIS OF THE PROPOSED REVISED REGULATIONS IMPLEMENTING TITLES II AND III OF THE ADA, INCLUDING REVISED ADA STANDARDS FOR ACCESSIBLE DESIGN

FINAL REPORT

Prepared By:
HDR HLB DECISION ECONOMICS INC.
8403 Colesville Road, Suite 910
Silver Spring, MD 20910

May 9, 2008

TABLE OF CONTENTS

Executive Summary

1. Introduction

2. ADAAG Background

2.1 Access Board Regulatory Assessment

2.2 Requirements

2.3 Facilities

2.4 Structure of Analysis and Scenarios

2.4.1 Barrier Removal and Safe Harbor

2.4.2 Classification of Requirements

2.4.3 Alternative Baselines 

2.4.4 Summary of Scenarios 

3.   Benefit-Cost Analysis Approach

3.1 Cost Estimation

3.1.1 Capital Construction Costs

3.1.2 Operations and Maintenance Costs (O&M)

3.1.3 Loss of Productive Space 

3.2 Benefits Estimation

3.2.1 Overview of theory

3.2.2 Benefits from Changes in Access Time

3.2.3 Economic Models for a Change in Access Time

3.3 Risk Analysis

3.4 Lifecycle Analysis

3.5 Evaluation criteria

4.   Data and Assumptions 

4.1 Cost Estimation Data and Discussion

4.1.1 Number of Facilities

4.1.2 Number of Elements per facility

4.1.3 Construction Costs

4.1.4 Operations and Maintenance Costs

4.1.5 Loss of Productive Space 

4.1.6 Replacement Costs

4.1.7 Expert Cost Review

4.2 Benefits Data and Assumptions

4.2.1 Number of Facility Visits of U.S. Adults

4.2.2 Number of Facility Visits of Persons with Disabilities

4.2.3 Lifecycle Assumptions

4.2.4 Generalized Use and Access Cost

4.2.5 Value of Time

4.2.6 Access Time Change

4.2.7 Price Elasticity of Demand for a Facility Visit

4.2.8 Ease of Access Adjustment

4.3 Risk Analysis

4.4 Definition of Baselines

5.   Results and Discussion

5.1 Results Under Primary Baseline Scenario

5.1.1 Total Net Present Value

5.1.2 Distribution of Costs and Benefits

5.1.3 Net Present Value by Requirements

5.1.4 Net Present Value by Facilities

5.1.5 Net Present Value for Public versus Private Facilities 

5.2 Results Under Additional Scenarios

5.2.1 Safe Harbor and No Safe Harbor Scenarios

5.2.2 Readily Achievable Scenarios

5.2.3 International Building Code (IBC) Scenarios 

5.3 Relative Impact of Selected Assumptions

5.4 Unquantified Benefits -- Option and Existence Values

6. Small Business Impact Analysis

Appendices

Appendix 1: Proposed Framework for the Regulatory Analysis (Reproduced from ANPRM)

Appendix 2: Summary of Requirements

Appendix 3: Cost Estimation Data

A. Numbers of Facilities 

B. Annual Growth Rates of Facilities

C. Assumptions With Respect to Estimated Typical Facility Size

D. Description of Element

E. Number of Elements Per Typical Facility 

F. Likelihood of Element in a Typical Facility

G. Likelihood of Element in a Typical Facility (Varying by Facility)

H. Unit Costs

I. Operation and Maintenance Cost 

J. Facility Space Cost

K. Changes in Productive Space Per Requirement

L. Years Before Replacement

Appendix 4: Benefits Estimation Data

A. Average Visits by Adults per Facility 

B. Total US Population

C. Total Sales per Facility 

D. Consumer Price Index 

E. Percentage of Disability, by Type 

F. Income Adjustment Factors by Facility

G. Time Use Survey

H. Total Access Time per Facility

I. Market Price by Facility

J. Value of Time

K. Description of Benefits by Requirement

L. Time Change / Expected Number of Uses Input

M. Likelihood of Realizing Benefits

N. Total Access Time Change per Facility

O. Elasticities 

P. Ease of Access (EOA) Adjustment by Facility

Q. Examples of Consumer Surplus Calculations

Appendix 5: Small Business Data

Appendix 6: RAP Primer

Appendix 7: RAP Panelists / Agenda

A. Benefits RAP Panel

B. Cost RAP Panel

Appendix 8: Matrix of Changes Represented by New and Revised Requirements

Appendix 9: Matrix of Applicable Baselines for IBC Scenarios

Appendix 10: Regulatory Proposals

List of Figures

Figure 1: Diagram of Conditions Corresponding to Compliance of Elements

Figure 2: Economic Framework for Estimating Benefits from Changes in Generalized Access Cost

Figure 3: Total Number of Elements: Top Five Most Frequently Occurring and All Others

Figure 4: Top 5 Average Barrier Removal Construction Costs Per Unit

Figure 5: Example of Cost RAP Question

Figure 6: Example of Benefits RAP Question

Figure 7: Total NPV - Baseline Scenario: SH/RA50/B1991; 3% and 7% Discount Rates

Figure 8: Distribution of Benefits between Users and Facilities (Cost Savings)

Figure 9: Distribution of Costs between Type of Cost, Type of Construction, Users

Figure 10: NPV for Selected Requirements

Figure 11: NPV for Selected Facilities

Figure 12: NPV for Selected Facilities with Public and Private

Figure 13: NPV Comparison -- Safe Harbor Policy: SH/RA50/ B1991 , NSH/RA50/ B1991

Figure 14: NPV Comparison -- Alternate Readily Achievable %: SH/ RA0, RA50, RA100/ B1991

Figure 15: NPV Comparison -- Alternate Baselines: SH/RA100/ B1991, B2000, B2003, B2006

Figure 16: Distribution of Sensitivities for Requirement 37: Side Reach. NPV = -$970.6

Figure 17: Distribution of Sensitivities for Requirement 32: Water closet clearance in single user toilet rooms -- in swinging doors. NPV = -928.1

Figure 18: Distribution of Sensitivities for Requirement 26: Passenger Loading Zones (Medical / Long-Term Care). NPV = -489.0

Figure 19: Distribution of Sensitivities for Requirement 23: Passenger Loading Zones. NPV = 1,835.3 

Figure 20: Distribution of Sensitivities for Requirement 70: Accessible Route to Exercise Machines and Equipment. NPV = 1,100.4

Figure 21: Distribution of Sensitivities for Requirement 45: Transient lodging Guest Room Vanities. NPV = 1,071.5

Figure 22: Combining Probability Distributions

Figure 23: Risk Analysis of Annual Capital Cost per Element, Illustration Only

List of Tables

Table 1: List of Requirements

Table 2: List of Facilities

Table 3: Number of Establishments in 2007 by Facility Group

Table 4: Requirements not included in Baseline Scenario

Table 5: Total Number of Annual Visits per Facility Group by Adults

Table 6: Total Net Present Value in Baseline Scenario at Expected Value (billions $)

Table 7: Costs and Benefits per Requirement in Baseline Scenario

Table 8: Total Costs and Benefits per Facility Group in Baseline Scenario

Table 9: Net Present Value for Public and Private Facilities

Table 10: Costs, Benefits and NPV Comparison using Primary (1991 Standards) Baseline and Requirement-Specific Alternate IBC Baseline -- Req. # 10 and 16

Table 11: Costs, Benefits and NPV Comparison Using Primary (1991 Standards) Baseline and Requirement-Specific Alternate IBC/ANSI Baselines -- Req # 32 and 37

Table 12: Impact on Results of Reduced to Access Time Premium

Table 13: Impact on Results of Reduced to Use Time Premium

Table 14: Impact on Results of Reduced Demand Elasticity At All Facilities

Table 17: Number of Facilities and Total Sales for Small vs. Facilities of All Sizes, and Ratio of Average Sales per Facility, by Facility Group

Table 18: Net Cost Comparison: Small vs. Facilities of All Sizes, by Facility Group

Table 19: Annual Cost Comparison: Small vs. Facilities of All Sizes, by Facility Group

Acronyms and Abbreviations

1991 ADAAG -- ADA Accessibility Guidelines

2004 ADAAG -- ADA/ABA Accessibility Guidelines

Access Board -- Architectural and Transportation Barriers Compliance Board

ABRA -- Access Board Regulatory Assessment

ADA -- Americans with Disabilities Act

ADAAG -- Americans with Disabilities Act Accessibility Guidelines

ALT - alterations

ANPRM -- Advance Notice of Proposed Rulemaking

BLS -- Bureau of Labor Statistics

BR -- barrier removal

CPI -- Consumer Price Index

Department or DOJ -- Department of Justice

EIA -- Energy Information Administration

HUD -- Department of Housing and Urban Development

IBC -- International Building Code

NAICS -- North American Industry Classification System

NC -- new construction

NPRM -- Notice of Proposed Rulemaking

NPV -- Net Present Value

O&M -- operation and maintenance

OMB -- Office of Management and Budget

RA -- readily achievable

RAP -- Risk Analysis Process

SBA -- Small Business Association

SH -- safe harbor

UFAS -- Uniform Federal Accessibility Standards

 

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last updated January 4, 2011