ASTM E2204-02

Standard Guide for Summarizing the Economic Impacts of Building-Related Projects

SCOPE
1.1 This guide describes a generic format for summarizing the economic impacts of building-related projects.
1.2 The guide provides technical persons, analysts, and researchers a tool for communicating project impacts in a condensed format to management and non-technical persons.
1.3 The generic format described in this guide calls for a description of the significance of the project, the analysis strategy, a listing of data and assumptions, and a presentation of the key economic measures of project impact.

General Information

• Status: Historical
• Publication Date: 09-Apr-2002
• ICS: 03.100.01 - Company organization and management in general
• ICS: 91.020 - Physical planning. Town planning
• Technical Committee: E06 - Performance of Buildings
• Drafting Committee: E06.81 - Building Economics

Relations

• Replaced By: ASTM E2204-05 - Standard Guide for Summarizing the Economic Impacts of Building-Related Projects
• Effective Date: 01-May-2005
• Referred By: ASTM E917-17(2023) - Standard Practice for Measuring Life-Cycle Costs of Buildings and Building Systems
• Effective Date: 10-Apr-2002
• Referred By: ASTM E1074-15(2020)e1 - Standard Practice for Measuring Net Benefits and Net Savings for Investments in Buildings and Building Systems
• Effective Date: 10-Apr-2002
• Referred By: ASTM E1369-15(2020)e1 - Standard Guide for Selecting Techniques for Treating Uncertainty and Risk in the Economic Evaluation of Buildings and Building Systems
• Effective Date: 10-Apr-2002
• Referred By: ASTM E964-15(2020)e1 - Standard Practice for Measuring Benefit-to-Cost and Savings-to-Investment Ratios for Buildings and Building Systems
• Effective Date: 10-Apr-2002
• Referred By: ASTM E2506-15(2020)e1 - Standard Guide for Developing a Cost-Effective Risk Mitigation Plan for New and Existing Constructed Facilities
• Effective Date: 10-Apr-2002
• Referred By: ASTM E1057-15(2020)e1 - Standard Practice for Measuring Internal Rate of Return and Adjusted Internal Rate of Return for Investments in Buildings and Building Systems
• Effective Date: 10-Apr-2002
• Referred By: ASTM E3130-21 - Standard Guide for Developing Cost-Effective Community Resilience Strategies
• Effective Date: 10-Apr-2002

Standards Content (Sample)

NOTICE: This standard has either been superseded and replaced by a new version or withdrawn.
Contact ASTM International (www.astm.org) for the latest information
An American National Standard
Designation:E2204–02
Standard Guide for
Summarizing the Economic Impacts of Building-Related
Projects
This standard is issued under the fixed designation E 2204; the number immediately following the designation indicates the year of
original adoption or, in the case of revision, the year of last revision. A number in parentheses indicates the year of last reapproval. A
superscript epsilon (e) indicates an editorial change since the last revision or reapproval.
INTRODUCTION
Quantitative descriptions of economic impacts are a basic requirement in many organizations for
evaluating budget requests and the value of a project to the organization. Several measures of
economic performance are available for evaluating building-related investments. These measures
include, but are not limited to, life-cycle cost, the benefit-to-cost ratio, adjusted internal rate of return,
and net benefits. This guide provides a generic format for presenting these economic measures of
building-related investments.
1. Scope E 1699 Practice for Performing Value Analysis (VA) of
Buildings and Building Systems
1.1 This guide describes a generic format for summarizing
E 1765 Practice forApplying theAnalytical Hierarchy Pro-
the economic impacts of building-related projects.
cess (AHP) to Multiattribute Decision Analysis of Invest-
1.2 The guide provides technical persons, analysts, and
ments Related to Buildings and Building Systems
researchers a tool for communicating project impacts in a
2.2 ASTM Adjuncts:
condensed format to management and non-technical persons.
Discount Factor Tables, Adjunct to Practice E 917
1.3 The generic format described in this guide calls for a
Computer Program and User’s Guide toAHP/Expert Choice
description of the significance of the project, the analysis
for ASTM Building Evaluation, Adjunct to Classifica-
strategy, a listing of data and assumptions, and a presentation
tions E 1557, E 1660 through E 1671, E 1693, E 1694,
of the key economic measures of project impact.
E 1700, and E 1701, and Practices E 917, E 964, E 1057,
2. Referenced Documents
E 1074, and E 1765
2.3 Other Document:
2.1 ASTM Standards:
Chapman, R. E., 2000, Benefits and Costs of Research: A
E 917 Practice for Measuring Life-Cycle Costs of Buildings
Case Study of Construction Systems Integration and
and Building Systems
Automation Technologies in Industrial Facilities, NISTIR
E 964 Practice for Measuring Benefit-to-Cost and Savings-
6501, Gaithersburg, MD: National Institute of Standards
to-Investment Ratios for Buildings and Building Systems
and Technology
E 1057 Practice for Measuring Internal Rate of Return and
Adjusted Internal Rate of Return for Investments in Build-
3. Terminology
ings and Building Systems
3.1 Definitions—For definitions of terms used in this guide,
E 1074 Practice for Measuring Net Benefits for Investments
refer to Terminology of Building Economics, E 833.
in Buildings and Building Systems
E 1121 Practice for Measuring Payback for Investments in
4. Summary of Guide
Buildings and Building Systems
4.1 This guide presents a standard format for presenting the
economic impacts of building-related projects. It includes the
1 entire range of private and public construction projects, as well
This guide is under the jurisdiction of ASTM Committee E06 on Performance
as research related to those projects.
of Buildings and is the direct responsibility of Subcommittee E06.81 on Building
Economics.
Current edition approved April 10, 2002. Published August 2002.
2 3
Annual Book of ASTM Standards, Vol 04.11. Annual Book of ASTM Standards, Vol 04.12.
Copyright © ASTM International, 100 Barr Harbor Drive, PO Box C700, West Conshohocken, PA 19428-2959, United States.
E2204–02
4.2 The generic format provided in this guide helps decision 5.9 There is no limitation to the use of the guide in
makers and managers understand the background and objec- facilitating communication between project analysts and
tives of a project, the data from which impacts were calculated,
project managers and other decision makers. Substantial ben-
how impact was measured, and the significance of the project’s efits from using the guide, however, are likely to come from its
measures of worth.
application in a large institution, such as a Federal agency,
where many projects are competing for funding, and a system-
5. Significance and Use aticpresentationofresultsthatcanbecomparedacrossprojects
and agencies is needed to allocate efficiently scarce funds.
5.1 This guide reduces the time and effort to communicate
the findings of project impact studies and improves the quality
6. How to Use This Guide
of communication between those who measure economic
impacts and those who evaluate and interpret them.
6.1 The generic format for summarizing project impacts is
5.2 Following the guide assures the user that relevant
outlined in Fig. 1.
economic information on the project is included in a summary
6.1.1 To promote a better understanding of the information
format that is understandable to both the preparer and user.
called for in Fig. 1, the numbered headings in the table are
5.3 Since the standard guide provides a consistent approach
cross-referenced to the subsections of 6.2. Specifically, the
to reporting the economic impacts of projects, it facilitates the
information called for under headings 1.a and 1.b is covered in
comparison of economic studies across projects and over time.
6.2.1, the information called for under heading 2 is covered in
5.4 The guide focuses on projects in construction and
6.2.2, and the information called for under headings 3.a, 3.b,
building-related research. It applies to government as well as
and 3.c is covered in 6.2.3.
private projects.And while the examples treat building-related
6.2 Presentation andAnalysis of the Results of an Economic
projects, the guide is applicable to non-building-related
Impact Assessment—The presentation and analysis of the
projects as well.
results of an economic impact assessment are central to
5.5 Building-sector users of this guide include building
understanding and accepting its findings. If the presentation is
owners and managers, private-sector construction companies,
clear and concise, and if the analysis strategy is logical,
research groups in building and construction industry trade
complete, and carefully spelled out, then the results will stand
associations, parties to public-sector construction projects, and
up under close scrutiny.This section describes a generic format
government laboratories conducting building-related research.
and procedure for summarizing the results of an economic
5.6 Use the guide to summarize the results of economic
impact assessment that meets the two previously cited condi-
impact studies that use ASTM standard practices E 917 (Life-
tions. The generic format is built upon the following three
Cycle Costs), E 964 (Benefit-to-Cost and Savings-to-
factors: (1) why the project is important; (2) how the analysis
Investment Ratios), E 1057 (Internal Rate of Return and
strategy was employed; and (3) how the key measures are
Adjusted Internal Rate of Return), E 1074 (Net Benefits),
calculated, summarized, and traced to relevant standards,
E 1121 (Payback), E 1699 (ValueAnalysis), and E 1765 (Ana-
codes, and regulations.These factors, taken together, constitute
lyticalHierarchyProcessforMultiattributeDecisionAnalysis).
a three-step procedure for summarizing the results of an
5.7 Use the guide to summarize the impacts of projects that
economic impact assessment. Four case studies are used to
affect exclusively initial costs, benefits, or savings, as well as
illustrate what a completed impact assessment using the
projects that affect life-cycle costs, benefits, or savings.
generic format would look like. The four case studies were
chosen so that there is one case study for each combination of
NOTE 1—Examples of projects dealing exclusively with initial costs,
benefits, or savings include design modifications or innovative construc- affected parties (see 5.8) and affected costs, benefits, or savings
tion practices that reduce labor or material costs, reduce construction
(see 5.7). The four case studies are presented in Appendix
duration, or increase construction productivity, but leave future costs,
X1-Appendix X4. Appendix X1 is based on a private-sector
benefits, or savings unchanged.
commercial building application where all impacts are internal
and only initial costs are relevant. Appendix X2 is based on a
5.8 Use the guide to summarize the impacts of projects that
affect parties that are internal to the organization preparing the highway project where both internal and external impacts are
important and only initial costs are relevant. Appendix X3 is
summary as well as projects that affect not only the organiza-
tion preparing the summary but also groups external to the based on an energy conservation project where all impacts are
internal and both initial and future costs and future savings are
organization.
included. Appendix X4 is based on a public-sector research
NOTE 2—Projects whose impacts are internal only correspond to
application where both internal and external impacts are
situations where the organization preparing the summary bears all of the
important and past, present, and future costs, benefits, and
costs and receives all of the benefits and/or savings from the project.
savings are included.
Examples include, but are not limited to, the use of innovative construc-
tion practices or alternative building materials, components, or systems
6.2.1 Why the Project Is Important:
that reduce initial costs and/or future costs to the building owner.
6.2.1.1 Headings 1.a and 1.b in Fig. 1 set the stage for
NOTE 3—Projects with a public-sector component frequently have
summarizing the results that follow.
...