Document ID: EPA-HQ-OW-2002-0030-0020
Agency: epa
Document Type: Supporting & Related Material
Title: 
Posted Date: 2002-06-24T04:00Z

APPENDIX
4A
Data
and
Modeling
Assumptions
for
Model
Project
Analysis
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Table
4A­
1.
Model
Parameters
and
Data
Sources
Parameters
Single­
family
Residential
Multifamily
Residential
Small
Commercial
(
Shopping
Center)
Industrial
Building
Value
Data
Source
Value
Data
Source
Value
Data
Source
Value
Data
Source
Size
of
parcel
1,
3,
7.5,
25,
70,
and
200
acres
EPA
assumption
1,
3,
7.5,
25,
70,
and
200
acres
EPA
assumption
1,
3,
7.5,
25,
70,
and
200
acres
EPA
assumption
1,
3,
7.5,
25,
70,
and
200
acres
EPA
assumption
Cost
of
raw
land
$
40,000
per
acre
NAHB
Chicago
focus
groups,
based
on
experience
of
the
Chicago­
area
participants.
See
Appendix
B
for
further
discussion.
$
40,000
per
acre
NAHB
Chicago
focus
groups,
based
on
experience
of
the
Chicago­
area
participants.
See
Appendix
A
for
further
discussion.
$
297,545
per
acre
Urban
Land
Institute
(
ULI)
Market
Profiles
2000:
North
America.
Median
land
cost
for
nonregional
shopping
centers
(
cost
ranges
for
individual
MSAs
were
averaged
before
taking
the
median)
$
137,500
per
acre
Urban
Land
Institute
(
ULI)
Market
Profiles
2000:
North
America.
Median
land
cost
for
industrial
parks
(
cost
ranges
for
individual
MSAs
were
averaged
before
taking
the
median)
.

Average
Lot
Size
0.33
acres
Census
Report
C25
(
Characteristics
of
New
Housing,
1999)
reports
an
average
lot
size
for
new
single­
family
homes
sold
of
12,910
square
feet,
which
represents
a
density
of
close
to
3
lots
per
acre.
(
The
median
lot
size
is
8,750
square
feet,
which
implies
a
density
of
almost
5
lots
per
acre)
.
N/
A
N/
A
N/
A
Approximate
Density
(
number
of
lots
per
acre)
2.67
Calculated
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygons,
 
to
account
for
impervious
surfaces
not
associated
with
individual
lots.
Total
number
of
lots
is
rounded
to
nearest
whole
number.
N/
A
N/
A
N/
A
4A­
1
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Table
4A­
1.
Model
Parameters
and
Data
Sources
Parameters
Single­
family
Residential
Multifamily
Residential
Small
Commercial
(
Shopping
Center)
Industrial
Building
Value
Data
Source
Value
Data
Source
Value
Data
Source
Value
Data
Source
Due
diligence
$
2,500
per
acre
Based
on
$
100,000
for
a
hypothetical
40­
acre
development
discussed
by
the
NAHB
Chicago
focus
group
participants.
See
Appendix
B
for
further
discussion.
$
2,500
per
acre
See
Single­
family
Residential
Data
Source
for
details.
$
2,500
per
acre
See
Single­
family
Residential
Data
Source
for
details.
$
2,500
per
acre
See
Single­
family
Residential
Data
Source
for
details.

Land
development
costs
$
25,000
per
lot
Estimate
from
NAHB
Chicago
focus
groups.
This
figure
includes
any
construction
activities
related
to
land
development
(
e.
g.
infrastructure
costs)
.
$
75,000
per
acre
Scaled
estimate
based
on
$
25,000
per
lot
from
NAHB
Chicago
focus
groups.
This
figure
includes
any
construction
activities
related
to
land
development
(
e.
g.
infrastructure
costs)
.
$
75,000
per
acre
Scaled
estimate
based
on
$
25,000
per
lot
from
NAHB
Chicago
focus
groups.
This
figure
includes
any
construction
activities
related
to
land
development
(
e.
g.
infrastructure
costs)
.
$
75,000
per
acre
See
Small
Commercial
Data
Source
for
details.

Engineering
costs,
as
percent
of
land
development
costs
6%
Estimate
from
NAHB
Chicago
focus
groups.
6%
Estimate
from
NAHB
Chicago
focus
groups.
6%
Estimate
from
NAHB
Chicago
focus
groups.
6%
Estimate
from
NAHB
Chicago
focus
groups.

Overhead
costs,
as
percent
of
development
costs
10%
Estimate
from
NAHB
Chicago
focus
groups.
10%
Estimate
from
NAHB
Chicago
focus
groups.
10%
Estimate
from
NAHB
Chicago
focus
groups.
10%
Estimate
from
NAHB
Chicago
focus
groups.

Contingency,
as
percent
of
land
development
costs
prior
to
impact
fees
10%
Estimate
from
NAHB
Chicago
focus
groups.
10%
Estimate
from
NAHB
Chicago
focus
groups.
10%
Estimate
from
NAHB
Chicago
focus
groups.
10%
Estimate
from
NAHB
Chicago
focus
groups.

Impact
fees
$
15,000
per
lot
Estimate
from
NAHB
Chicago
focus
groups.
See
Appendix
B
for
further
discussion.
$
45,000
per
acre
Scaled
estimate
based
on
$
15,000
per
residential
lot
from
NAHB
Chicago
focus
groups.
See
Appendix
A
for
further
discussion.
$
45,000
per
acre
See
Multifamily
Data
Source
for
details.
$
45,000
per
acre
See
Multifamily
Data
Source
for
details.

4A­
2
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Table
4A­
1.
Model
Parameters
and
Data
Sources
Parameters
Single­
family
Residential
Multifamily
Residential
Small
Commercial
(
Shopping
Center)
Industrial
Building
Value
Data
Source
Value
Data
Source
Value
Data
Source
Value
Data
Source
Real
estate
and
marketing
fees,
as
percent
of
sales
price
of
building
7%
Estimate
from
NAHB
Chicago
focus
groups.
7%
Estimate
from
NAHB
Chicago
focus
groups.
7%
Estimate
from
NAHB
Chicago
focus
groups.
7%
Estimate
from
NAHB
Chicago
focus
groups.

Average
size
of
building
2,310
square
feet
From
Census
Report
C25,
the
average
size
of
new
single­
family
homes
sold
in
1999
and
conventionally
financed
was
2,310
square
feet.
Varies
Scaled
to
site
size
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygon.
 
Varies
Scaled
to
site
size
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygon.
 
Varies
Scaled
to
site
size
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygon.
 
Cost
of
building
construction
$
53.80
per
sq.
ft.
From
NAHB
 
s
website,
construction
costs
for
a
generic
single­
family
house
are
$
124,276.
$
124,276
÷
2,310
=
=
$
53.80.
See
Appendix
B
for
further
discussion.
$
54.05
per
sq.
ft.
R.
S.
Means
Building
Construction
Cost
Data
median
construction
cost
per
square
foot
for
a
 
typical
 
low­
­
rise
(
1­
3
stories)
apartment
building.
$
53.85
per
sq.
ft.
R.
S.
Means
Building
Construction
Cost
Data
median
construction
cost
per
square
foot
for
a
 
typical
 
supermarket
$
$
36.15
R.
S.
Means
Building
Construction
Cost
Data
median
construction
cost
per
square
foot
for
a
 
typical
 
industrial
warehouse.

Total
Paved
Surface
Area
(
Parking,
Driveways,
and
Roads)
N/
A
Varies
Scaled
to
site
size
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygon.
 
Varies
Scaled
to
site
size
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygon.
 
Varies
Scaled
to
site
size
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygon.
 
Paving
Cost
(
Parking,
Driveways,
and
Roads)
N/
A
$
1.44
per
sq.
ft.
R.
S.
Means
Heavy
Construction
Cost
Data
$
1.44
per
sq.
ft.
R.
S.
Means
Heavy
Construction
Cost
Data
$
1.44
per
sq.
ft.
R.
S.
Means
Heavy
Construction
Cost
Data
Total
Sidewalk
Area
N/
A
Varies
Scaled
to
site
size
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygon.
 
Varies
Scaled
to
site
size
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygon.
 
Varies
Scaled
to
site
size
based
on
impervious
surface
ratios
from
 
Chesapeake
Bay
Watershed
Impervious
Cover
Results
by
Land
Use
Polygon.
 
4A­
3
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Table
4A­
1.
Model
Parameters
and
Data
Sources
Parameters
Single­
family
Residential
Multifamily
Residential
Small
Commercial
(
Shopping
Center)
Industrial
Building
Value
Data
Source
Value
Data
Source
Value
Data
Source
Value
Data
Source
Sidewalk
Construction
Cost
N/
A
$
4.66
per
sq.
ft.
R.
S.
Means
Heavy
Construction
Cost
Data
$
4.66
per
sq.
ft.
R.
S.
Means
Heavy
Construction
Cost
Data
$
4.66
per
sq.
ft.
R.
S.
Means
Heavy
Construction
Cost
Data
Percent
of
total
land
cost
that
a
developer
can
finance
for
land
acquisition
65%
Loan­
to­
value
ratio
as
written
in
the
Real
Estate
Lending
Rules.
See
Appendix
B
for
further
discussion.
65%
See
Single­
family
Residential
Data
Source
for
details.
65%
See
Single­
family
Residential
Data
Source
for
details.
65%
See
Single­
family
Residential
Data
Source
for
details.

Percent
of
total
land
cost
that
a
developer
can
finance
for
land
development
70%
Loan­
to­
value
ratio
as
written
in
the
Real
Estate
Lending
Rules.
See
Appendix
B
for
further
discussion.
70%
See
Single­
family
Residential
Data
Source
for
details.
70%
See
Single­
family
Residential
Data
Source
for
details.
70%
See
Single­
family
Residential
Data
Source
for
details.

Percent
of
total
building
construction
cost
that
a
builder
can
finance
80%
Loan­
to­
value
ratio
as
written
in
the
Real
Estate
Lending
Rules.
See
Appendix
B
for
further
discussion.
80%
See
Single­
family
Residential
Data
Source
for
details.
80%
See
Single­
family
Residential
Data
Source
for
details.
80%
See
Single­
family
Residential
Data
Source
for
details.

Loan
interest
rate
for
builder/
developer
7.5%
EPA
estimate.
7.5%
EPA
estimate.
7.5%
EPA
estimate.
7.5%
EPA
estimate.

Term
of
land
acquisition
loan,
years
3
EPA
assumption.
Assumes
that
the
land
acquisition
loan
is
paid
off
over
the
life
of
the
project,
which
in
this
case
is
3
years.
3
See
Single­
family
Residential
Data
Source
for
details.
3
See
Single­
family
Residential
Data
Source
for
details.
3
See
Single­
family
Residential
Data
Source
for
details.

Term
of
land
development
loan,
years
1
EPA
assumption.
Assumes
that
the
land
development
loan
term
is
equal
to
the
length
of
the
development
phase
of
the
project,
which
in
this
case
is
1
year.
1
See
Single­
family
Residential
Data
Source
for
details.
1
See
Single­
family
Residential
Data
Source
for
details.
1
See
Single­
family
Residential
Data
Source
for
details.

4A­
4
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Table
4A­
1.
Model
Parameters
and
Data
Sources
Parameters
Single­
family
Residential
Multifamily
Residential
Small
Commercial
(
Shopping
Center)
Industrial
Building
Value
Data
Source
Value
Data
Source
Value
Data
Source
Value
Data
Source
Term
of
building
construction
loan,
years
1
EPA
assumption.
Assumes
that
the
construction
loan
term
is
equal
to
the
length
of
the
construction
phase
of
the
project,
which
in
this
case
is
1
year.
1
See
Single­
family
Residential
Data
Source
for
details.
1
See
Single­
family
Residential
Data
Source
for
details.
1
See
Single­
family
Residential
Data
Source
for
details.

Assumed
pre­
tax
profit
on
land
development
10%
NAHB
Chicago
focus
group
estimated
12­
14
percent;
10
percent
is
an
EPA
assumption.
See
Appendix
B
for
further
discussion.
10%
See
Single­
family
Residential
Data
Source
for
details.
10%
See
Single­
family
Residential
Data
Source
for
details.
10%
See
Single­
family
Residential
Data
Source
for
details.

Assumed
pre­
tax
profit
on
construction
10%
NAHB
Chicago
focus
groups
estimated
8
to
12
percent
pre­
tax
at
time
of
sale.
R.
S.
Means
uses
10
percent
as
a
profit
assumption
in
their
Cost
Data
book
series.
10%
See
Single­
family
Residential
Data
Source
for
details.
10%
See
Single­
family
Residential
Data
Source
for
details.
10%
See
Single­
family
Residential
Data
Source
for
details.

4A­
5
APPENDIX
4B
Detailed
Description
of
Model
Parameters
and
Assumptions
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Cost
of
Raw
Land
Land
prices
tend
to
vary
by
region
of
the
country,
and
even
within
particular
regions,
depending
on
the
exact
location
of
the
parcel
(
e.
g.
,
urban
proximity)
.
For
this
generic
single­
family
project
cost
model,
a
value
of
$
40,000
per
acre
is
used
based
on
the
estimate
provided
by
participants
in
the
Chicago
NAHB
focus
group
morning
session.
The
participants
in
the
NAHB
Dallas
focus
group
meetings
confirmed
that
even
within
one
state
lot
prices
can
range
dramatically.
Prices
per
lot
were
reported
to
range
from
near
$
10,000
in
El
Paso,
TX,
to
nearly
$
1
million
in
Austin
(
for
lake­
front
property)
.
(
Note,

these
costs
cited
were
per
lot,
not
per
acre)
.
The
single­
family
development
land
cost
estimate
was
also
used
in
the
multifamily
residential
project
model
due
to
lack
of
other
data.

Land
prices
for
the
commercial
and
industrial
models
were
taken
from
the
Urban
Land
Institute
 
s
(
ULI)
Market
Profiles
2000:
North
America,
which
lists
average
land
costs
for
shopping
centers
and
industrial
parks
for
selected
Metropolitan
Statistical
Areas
(
MSAs)
depending
on
data
availability.
The
median
land
cost
for
each
project
type
was
calculated
from
a
list
of
MSA
average
land
costs
and
used
in
the
models
as
a
national
estimate
proxy.

Due
Diligence
As
described
previously,
due
diligence
refers
to
the
work
done
by
the
developer
prior
to
taking
ownership
of
a
parcel.
During
this
time
the
developer
conducts
a
variety
of
environmental
and
engineering
assessments
to
identify
any
potential
obstacles
to
the
successful
completion
of
the
proposed
development.
At
this
time
the
only
estimates
for
due
diligence
costs
are
based
on
a
$
100,000
estimate
provided
by
the
Chicago
NAHB
focus
group
participants
for
a
40­
acre
project.
This
figure
was
converted
to
$
2,500
per
acre
on
the
assumption
that
these
costs
would
fluctuate
depending
on
the
size
of
the
project.

Impact
Fees
The
NAHB
 
s
Chicago
focus
group
estimated
the
impact
fees
on
new
residential
construction
to
average
$
15,000
per
lot.
This
figure
was
converted
to
$
45,000
per
acre
for
use
in
the
multifamily,

commercial,
and
industrial
project
models.

4B­
1
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
This
is
one
of
many
estimates
that
may
be
found
in
the
literature.
In
their
book
Red
Tape
and
Housing
Costs
,
Michael
Luger
and
Kenneth
Temkin
interviewed
numerous
builders
and
developers
in
New
Jersey
and
North
Carolina,
and
received
several
estimates
for
impact
fees
in
North
Carolina.

Estimates
ranged
from
approximately
$
2,800
to
$
6,547
per
unit
in
Cary,
NC,
and
from
$
1,300
to
$
2,765
in
Durham,
NC.
Even
the
highest
estimate
in
these
ranges
is
significantly
lower
than
the
estimate
from
the
focus
group
meeting.
These
fees
represent
approximately
1
to
2
percent
of
the
final
sale
price
of
a
house
in
the
area.

In
a
cost
breakdown
of
a
single­
family
home
provided
by
NAHB
on
their
website,
34
impact
fees
were
estimated
at
$
1,182
per
unit
(
approximately
1
percent
of
total
construction
cost)
.
A
study
by
the
Sierra
Club
(
Sierra
Club
2000)
estimates
that
impact
fees
range
from
under
$
1,000
per
unit
to
approximately
$
6,140
per
single­
family
unit.
These
figures
are
based
on
local
observations.
Finally,

Ross
and
Thorpe
(
1992)
report
that
a
survey
conducted
in
1990
in
Orange
County,
California
(
one
of
the
most
expensive
housing
markets
in
the
country)
,
found
at
least
three
cities
in
that
county
with
impact
fees
exceeding
$
20,000
per
unit.
This
estimate
is
closest
to
the
assumption
currently
in
the
models.

At
this
time,
EPA
is
unaware
of
any
single
national
estimate
for
the
average
impact
fee
imposed
on
developers
and
builders
and
has
chosen
to
use
the
NAHB
estimate
for
this
analysis.

Building
Construction
Costs
The
approach
used
in
the
model
project
for
estimating
average
building
construction
costs
for
the
single­
family
project
is
to
take
total
construction
costs
for
a
new
single­
family
house,
provided
by
NAHB
on
their
website
(
$
124,276)
(
NAHB
2001b)
,
and
divide
that
figure
by
the
average
square
footage
of
a
new,
conventionally
financed,
house
as
reported
by
Census
(
2,310
square
feet;
Characteristics
of
New
Housing)
.
This
calculation
yields
an
average
construction
cost
of
$
53.80
per
square
foot.
NAHB
focus
group
participants
estimated
that
building
construction
costs
ranged
from
$
50
to
$
75
per
square
foot,
at
least
in
the
Chicago
area.
The
national
estimate
is
within
the
range
provided
by
NAHB
members
at
the
focus
group
meeting.

34
http:
/
/
www.
nahb.
com/
housing_
issues/
balance_
2.
htm
4B­
2
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Building
construction
costs
for
the
remaining
projects
 
multifamily,
,
commercial,
and
industrial
 
were
taken
from
R.
.
S.
Means
Building
Construction
Cost
Data
.
The
costs
used
were
median
costs
for
the
 
typical
 
sized
building
for
each
project
type,
,
based
on
the
projects
detailed
in
the
R.
S.
Means
project
database.
While
the
building
costs
may
fluctuate
some
with
overall
building
size,
the
median
cost
was
used
as
a
proxy
for
national­
level
building
costs
and
was
used
regardless
of
site
or
building
size.

Building
size
for
these
three
project
types
was
assumed
to
fluctuate
with
site
size.
Size
estimates
for
each
site
size
were
determined
using
the
building
to
site
area
ratio
from
the
Center
for
Watershed
Protection.

Multiplying
this
ratio
by
each
site
size
(
1,
3,
7.5,
etc.
acres)
gave
EPA
an
estimate
of
building
footprint.

Since
multifamily
building
construction
costs
were
based
on
low­
rise
apartment
buildings
1
to
3
stories
in
height,
an
average
of
2
stories
per
apartment
building
was
used
to
calculate
total
building
square
footage
from
the
footprint.
Commercial
and
industrial
buildings
were
assumed
to
be
1
story;
therefore
the
building
footprint
equaled
total
building
area.

Impervious
Surface
Estimates
Estimates
for
impervious
surface
area
and
construction
costs
were
calculated
for
the
multifamily,

commercial,
and
industrial
model
projects.
The
impervious
surface
area
for
roads,
driveways,
parking,

and
sidewalks
was
calculated
by
multiplying
the
impervious
surface
area
to
site
size
ratio
(
CWP
2001)
by
the
site
size.
R.
S.
Means
cost
estimates
for
paving
and
sidewalk
construction
were
used
to
estimate
impervious
surface
construction
costs.
The
paving
cost
estimate
(
$
1.44
per
square
foot)
was
multiplied
by
the
combined
surface
area
for
roads,
driveways,
and
parking
while
the
sidewalk
cost
estimate
(
$
4.66
per
square
foot)
could
be
directly
multiplied
to
the
sidewalk
surface
area
estimate.

Financing
Requirements
A
December
28,
1999,
memo
from
ERG
to
EPA
(
 
Real
Estate
Development
Financing
 
)
cites
the
typical
land
acquisition
loan
duration
is
2
years,
whereas
the
models
currently
use
a
duration
of
3
years.
It
is
not
clear
if
the
2
year
loan
term
includes
the
same
activities
as
assumed
for
the
model
projects.
Similarly,
the
duration
for
the
land
development
loan
is
cited
as
approximately
2
years
(
comparable
to
that
for
the
land
acquisition
loan)
.
The
average
duration
of
the
construction
loan
is
not
cited
in
the
memo,
although
it
may
be
assumed
that
the
duration
of
the
loan
would
vary
with
project
size.

4B­
3
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Loan­
to­
value
ratios
under
the
Real
Estate
Lending
Rules
declined
from
approximately
80
percent
for
all
phases
of
project
development
to
the
following
breakdown
after
the
Savings
and
Loan
Crisis:

 
65
percent
for
land
acquisition
 
75
percent
for
land
development
 
80
percent
for
construction
The
memo
also
states
that
the
typical
land
acquisition
loan
rate
is
1­
4
points
above
the
prime
rate.

No
further
detail
for
the
remaining
project
stages
is
given,
but
they
are
assumed
to
be
within
the
same
range.
The
models
currently
use
a
loan
rate
of
7.5
percent.

Profit
Assumptions
Profit
on
both
land
development
and
building
construction
are
assumed
to
be
10
percent,
based
on
conversations
with
NAHB
and
reality­
checked
against
the
assumptions
used
in
the
R.
S.
Means
Cost
Data
series.
Note
that
there
would
not
be
a
separate
profit
for
the
land
development
phase
of
the
project
because
the
developer­
builder
would
retain
ownership
of
the
project
through
building
construction
(
land
development
profit
is
only
realized
when
a
developer
sells
finished
lots
to
individual
builders)
.
The
profit
rate
with
100
percent
CPT
is
based
on
the
assumption
that
any
additional
costs
incurred
by
the
developer­

builder
(
i.
e.
,
additional
storm
water
control
costs)
would
be
passed
through
to
the
consumer,
and
that
none
of
the
additional
costs
would
be
borne
by
the
developer­
builder
as
decreased
profit.
The
profit
rate
with
zero
CPT
depends
on
the
level
of
costs.

Overhead
Assumptions
EPA
assumes
that
developers
apply
an
overhead
charge
to
all
costs
incurred
during
the
land
development
phase,
and
that
a
further
overhead
charge
is
levied
by
the
builder
on
all
costs
incurred
during
the
building
phase,
including
the
cost
of
lot
acquisition.
These
overhead
charges
represent,
in
part,

payment
to
the
owner
for
capital
tied
up
to
secure
development
and
construction
loans
as
well
as
compensation
for
managing
and
overseeing
the
work
of
subcontractors
and
other
professionals
(
engineers,

architects,
designers)
.

4B­
4
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
The
estimated
overhead
rate
of
10
percent
at
the
development
stage
and
10
percent
at
the
building
phase
was
based
on
input
from
NAHB.
EPA
has
separately
calculated
the
 
opportunity
cost
of
capital
 
based
on
actual
financing
needs,
loan
conditions,
and
loan
terms.
In
the
model
projects,
therefore,
the
actual
percentage
applied
as
an
overhead
factor
has
been
adjusted
downwards.

4B­
5
APPENDIX
4C
Characteristics
of
Model
Establishments
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Table
4C­
1.
Model
Establishment
Characteristics
Based
on
Census
Data
[
1
]

Class
Number
of
Establishments
Average
Starts
Average
Revenue
Average
Employment
Cashflow
1­
4
17,107
2.
3
$
492.
2
2.
5
$
46.3
Single
5­
9
7,589
6.
4
$
1,088.
6
3.
3
$
104.9
Family
10­
24
6,262
14.
6
$
1,987.
0
4.
3
$
177.3
25­
99
3,018
41.
9
$
4,923.
5
8.
6
$
4,229.0
100­
499
833
191.
7
$
24,030.
7
32.
1
$
2,187.6
500+
122
864.
5
$
109,032.
6
160.
0
$
9,192.5
2­
9
486
4.
3
$
644.
8
3.
2
$
29.4
Multifamily
10­
24
398
16.
5
$
1,381.
6
5.
1
$
99.6
25­
99
383
55.
1
$
3,499.
7
8.
0
$
320.1
100­
499
593
191.
7
$
7,410.
0
13.
5
$
566.6
500+
39
959.
0
$
43,844.
4
64.
7
$
938.8
Commercial
50­
99
41,356
13.2
$
23,799
67.
5
$
927.5
Industrial
50­
99
8,042
9.5
$
18,470
67.
7
$
627.3
[
1
]
Dollar
values
in
thousands
4C­
1
­
­
­
­
­
­
­
­
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Table
4C­
2
Model
Establishment
Characteristics
Based
on
Dun
And
Bradstreet
Data
Single
Family
(
SIC
1531)
Multifamily
(
SIC
1522)
Commercial
(
SIC
1542)
Industrial
(
SIC
1541)
Line
Item
S
caled
Value
[
1
]
Percent
S
caled
Value
[
1
]
Percent
S
caled
Value
[
1
]
Percent
S
caled
Value
[
1
]
Percent
Cash
$
82,22
9
11.9
%
$
55,75
2
18.4
%
$
61,70
5
21.5
%
$
57,68
2
19.1%

A
cco
unts
Receiv
a
ble
$
61,49
9
8.9
%
$
81,20
4
26.8
%
$
101,59
8
35.4
%
$
108,11
6
35.8%

Notes
Receiv
a
ble
$
4,83
7
0
.7
%
$
3,93
9
1
.3
%
$
2,00
9
0
.7
%
$
2,71
8
0.9%

Inventory
$
210,06
4
30.4
%
$
12,72
6
4.2
%
$
5,74
0
2.0
%
$
4,53
0
1.5%

Other
Current
$
152,71
1
22.1
%
$
67,56
9
22.3
%
$
60,27
0
21.0
%
$
58,58
8
19.4%

Total
Current
Assets
$
511,34
0
7
4
.
0
%
$
221,19
0
7
3
.
0
%
$
231,32
2
8
0
.
6
%
$
231,63
4
7
6
.
7%

Fix
ed
A
ssets
$
109,17
8
15.8
%
$
58,17
6
19.2
%
$
41,04
1
14.3
%
$
52,24
6
17.3%

Other
Non­
current
$
70,48
2
10.2
%
$
23,63
4
7.8
%
$
14,63
7
5.1
%
$
18,12
0
6.0%

Total
Asset
s
$
691,00
0
1
0
0
.0
%
$
303,00
0
1
0
0
.0
%
$
287,00
0
1
0
0
.0
%
$
3
0
2
,0
0
0
100.0%

A
cco
unts
Paya
ble
$
56,66
2
8.2
%
$
73,02
3
24.1
%
$
87,24
8
30.4
%
$
79,12
4
26.2%

Bank
Loans
$
11,74
7
1.7
%
$
2,42
4
0.8
%
$
1,43
5
0.5
%
$
6
0
4
0.2%

Notes
Paya
ble
$
101,57
7
14.7
%
$
18,48
3
6.1
%
$
6,88
8
2.4
%
$
7,24
8
2.4%

Other
Current
$
196,93
5
28.5
%
$
102,41
4
33.8
%
$
52,52
1
18.3
%
$
57,98
4
19.2%

Total
Current
Liabilities
$
366,92
1
5
3
.
1
%
$
196,34
4
6
4
.
8
%
$
148,09
2
5
1
.
6
%
$
144,96
0
4
8
.
0%

Other
Long
Term
$
81,53
8
11.8
%
$
29,99
7
9.9
%
$
15,49
8
5.4
%
$
22,34
8
7.4%

Deferred
Credit
s
$
5,52
8
0
.8
%
$
1,21
2
0
.4
%
$
57
4
0
.2
%
$
30
2
0.1%

Net
W
orth
$
237,01
3
34.3
%
$
75,44
7
24.9
%
$
122,83
6
42.8
%
$
134,39
0
44.5%

Total
Liabilities
&
Net
W
orth
$
691,00
0
1
0
0
.0
%
$
303,00
0
1
0
0
.0
%
$
287,00
0
1
0
0
.0
%
$
3
0
2
,0
0
0
100.0%

Ne
t
Sales
$
1,000,000
100.0%
$
1,000,000
100.0%
$
1,000,000
100.0%
$
1,000,000
100.0%

Gross
Profit
$
228,00
0
22.8
%
$
190,00
0
19.0
%
$
159,00
0
15.9
%
$
184,00
0
18.4%

Net
Profit
A
fter
Tax
$
12,00
0
1.2
%
$
35,00
0
3.5
%
$
30,00
0
3.0
%
$
34,00
0
3.4%

W
orking
Capital
$
144,419
$
24,846
$
83,230
$
86,674
Gross
P
rofit
Ratio
0.22
8
0.19
0
0.15
9
0.184
Ret
urn
on
Net
W
orth
Ratio
0.05
1
0.46
4
0.24
4
0.253
Current
Ratio
1.39
4
1.12
7
1.56
2
1.598
Debt
t
o
E
quit
y
Ratio
1.91
5
3.01
6
1.33
6
1.247
[
1
]
Values
scaled
according
to
$
$
1,
000,000
net
sales
for
comparative
purposes
4C­
2
Economic
Analysis
of
Construction
and
Development
Proposed
Effluent
Guidelines
May
2002
Table
4C­
3
Financial
Ratio
Data
by
Quartile
Uppe
r
Low
e
r
S
e
ctor
Ra
ti
o
Q
u
a
r
t
i
l
e
Me
dia
n
Q
u
a
r
t
i
l
e
Current
2
.
9
0
0
1
.
4
0
0
1
.
1
0
0
S
i
n
g
l
e
Family
De
bt
t
o
E
quit
y
0
.
7
2
4
1
.
7
9
6
4
.
9
2
8
Ret
urn
on
Ne
t
W
o
rth
0
.
3
3
5
0
.
1
6
8
0
.
0
6
6
Current
2
.
5
0
0
1
.
5
0
0
1
.
1
0
0
Mul
tifamily
De
bt
t
o
E
quit
y
0
.
5
9
5
1
.
2
8
0
3
.
1
7
9
Ret
urn
on
Ne
t
W
o
rth
0
.
5
8
9
0
.
2
2
7
0
.
0
6
1
Current
2
.
2
0
0
1
.
5
0
0
1
.
2
0
0
Commer
ci
a
l
De
bt
t
o
E
quit
y
0
.
6
6
0
1
.
4
5
6
2
.
8
2
3
Ret
urn
on
Ne
t
W
o
rth
0
.
3
6
9
0
.
1
6
4
0
.
0
5
5
Current
2
.
5
0
0
1
.
6
0
0
1
.
2
0
0
Industrial
De
bt
t
o
E
quit
y
0
.
5
2
7
1
.
3
0
0
2
.
7
2
3
Ret
urn
on
Ne
t
W
o
rth
0
.
3
8
6
0
.
1
5
1
0
.
0
5
5
4C­
3