Economic Study

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CoreFirst, llc. (CoreFirst) of Portland, Oregon has developed a new system to protect buildings (actually people in buildings) from earthquakes as well as a number of other natural and man‐ made disasters. CoreFirst’s system is patented and is designed to be integrated into a 1‐4 level building to create a safe space for people inside the building.

This economic benefit‐cost analysis prepared by Kleinhenz & Associates for CoreFirst is specific to earthquakes and considers a specific case of a four‐building elementary school system that is faced with the option of retro‐fitting one of the four buildings using the traditional and more costly method or, for the same cost, retrofitting all four buildings using the CoreFirst system. It includes a comparison between the two retrofit options in terms of cost to society, not merely costs to the school system. Three earthquake scenarios are examined: mild, moderate, and severe. All assumptions regarding inputs used in the study are referenced.

The primary assumption is that an earthquake will occur. This simplifies the explanation since we need only compare the traditional retrofit versus the CoreFirst at one point in time. As such, the analysis holds constant probabilities of occurrence, time value of money, net present value, interest rates, future incomes and projected healthcare costs, etc. All of these measures are important when considering a retrofitting approach. However, in this analysis it is assumed the school system wants a retrofit and the decision is to determine what kind of retrofit they desire. It is noted that the CoreFirst option costs approximately 25 percent to 30 percent of the cost of a standard retrofit. This savings allows for four school buildings to be retrofitted using the CoreFirst method versus one school building being retrofitted using the standard retrofit techniques. If an earthquake does not occur, the CoreFirst system remains available to offer building occupants protection in a number of other emergency scenarios. In addition, the CoreFirst system includes educational messages, first aid equipment, communication equipment along with other features while the traditional seismic upgrade does not.

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