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The Economic Benefits of a Disaster Resistant University:
Earthquake Loss Estimation for UC Berkeley
01 May 2000


* UC Berkeley has done more that any other university in the nation to improve the seismic safety of its buildings. This study looks at the importance of loss reduction programs and business resumption planning.

* The object of this study is to help research universities facing the potential for natural disaster to find ways to safeguard their research as well as the human capital associated with the academic environment (students, faculty, and staff).

* The federal government funds $15 billion in research annually. On average, the University of California, Berkeley receives more than $350 million a year in research grants.

* Moderate earthquakes have caused heavy damage at several universities in the last decade. In the 1989 Loma Prieta Earthquake, 200 buildings at Stanford University were damaged, 24 were closed for a number of years. Repair costs totaled more than $200 million.

* In the 1994 Los Angeles-area earthquake, 107 buildings were damaged and every campus building at California State University, Northridge, was closed. Total damage: $400 million. In the same earthquake at UCLA 20 miles away, 10 buildings suffered structural damage and losses from overturned equipment in the medical center alone quadrupled damages. Total campus (plus hospital) damages: $600 million.

* Overall, the potential value of losses to UC Berkeley campus facilities, depending on the severity of the earthquake, ranges from $625 million to $2.6 billion ( about 30 percent of the replacement value of the campus (without land value).

* 29 percent of the space at UC Berkeley is dedicated to research

* The value of contents (equipment, labs, furnishings, etc.) is about $3 billion

* Replacement value of campus buildings (including student housing and parking structures) is approximately $6 billion

* If an earthquake of 7.0 or larger on the Hayward Fault were to strike today, it could force a campus closure for up to one year. However, as a result of the 1997 SAFER Program, six major building retrofit projects are underway and retrofits on four additional campus buildings are scheduled for completion between 2001 and 2006. These efforts will help to greatly reduce the time needed for post-quake building repairs.

* If the campus were to close for one year, the aggregate economic losses to the region would be significant($680 million in personal income, $861 million in sales and some 8,900 jobs lost.

* The most important contribution of the university to the regional economy is the supply of professional graduates. There is a 20 percent chance that a student who comes to UC Berkeley from out of state or out of the country will stay in California after graduation. Each of these individual workers will contribute roughly $1 million to the state GDP and conservatively pay $100,000 in state taxes over their lifetime.



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