Alarmingly Useless: 
The Case for Banning Car Alarms in New York City

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Appendix A

Car Alarm Noise Cost Model^*

[ MAIN FINDINGS | DEVELOPING A COST MODEL FOR CAR ALARMS | STEP 1: V | STEP 2: APF | STEP 3: N | STEP 4: NDI | STEP 5: HOW MUCH IS A NEW YORK MINUTE REALLY WORTH? | STEP 6: FACTORING IN TA'S SURVEY DATA | STEP 7: INSURANCE DISCOUNT VERSUS THE NOISE TAX ]

MAIN FINDINGS

The average New York City resident pays a car alarm "Noise Tax" of approximately $100 to $120 per year.

Car alarms cost New York City $400 to $500 million per year.

DEVELOPING A COST MODEL FOR CAR ALARMS

The model below attempts to determine the cost of car alarm noise to the people of New York City. Car alarm noise is a form of pollution known as a "negative externality": the unexpected and unaccounted-for cost of an economic activity. When a New Yorker buys and installs a car alarm, its price does not account for the health, productivity, property value, and quality of life costs the alarm will impose on the owner's neighbors. This model provides a simple, straightforward formula to allow us to begin to calculate the cost of audible car alarms in the dense urban environment of New York City.

(V * APF) * (N * NDI) = One minute's worth of car alarm damage to the average New York City resident.

V = The value of one minute of the average New Yorker's time.
APF = Aggravation Persistence Factor
N = Alarm noise over and above average street noise. Measured in decibels.
NDI = Noise Depreciation Index

STEP 1: V

We determine the value of V, the value of one minute's worth of the average New Yorker's time. To keep things simple and straightforward, we base this number on income.

Total per-capita income in 1999 for New York City (US Census 2000) = $33,901
$33,901 / 365 days = $92.88 / day
There are 1,440 minutes in a 24 hour day.
$92.88 / 1,440 minutes = 6.5 cents.
V = 6.5 cents

When one minute of the average New Yorker's life enjoyment and productivity is destroyed, it costs 6.5 cents.

STEP 2: APF

As our research shows, the type of noise produced by car alarms has a cumulative effect on public health, productivity, property value and quality of life. Personal experience backs this up. An alarm ringing for just two minutes in the middle of the night, for example, can wake a person up for a full hour and ruin a good portion of that person's productivity the next day. Noise research consistently shows that the harm of a loud variable noise goes beyond the one or two minutes that the noise is actually sounding. The Aggravation Persistence Factor (APF) is a number that accounts for the damage that an alarm does above and beyond the time that it is actually sounding. A night-time alarm may have a higher APF than a work-day alarm. For the purposes of this model, we are using 5 as our APF value, assuming that one minute's worth of alarm creates, on average, five minutes worth of stress, damage and aggravation.

V = 6.5 cents
APF = 5

(6.5 cents * 5 APF) = 32.5 cents.

One minute's worth of car alarm noise destroys 32.5 cents worth of life enjoyment and productivity for the average New Yorker.

STEP 3: N

Next we want to determine how much noise an alarm creates over and above the typical New York City street noise. The U.S. Environmental Protection Agency estimates urban residential areas to have, on average, residual noise levels ranging from 46 to 60 decibels (dBA). The decibel scale, it should be understood, is logarithmic not linear. An increase of 10 dBA represents a doubling in perceived loudness. We will use 53 dBA as the average background noise level in an urban area.

Many car alarms on the market today boast of their ability to reach sound levels as high as 125 dBA. We must assume that most alarms are not this loud. We also know that if a person is standing right next to the alarm when it sounds, the noise is much louder and more intense than it is for a person 300 feet away. To be conservative, let's say that the average car alarm raises the background noise level to 78 dBA.

78 dBA - 53 dBA = 25 dBA.

Researchers have long noted that variable noise is generally more disturbing to human beings than steady noise, even when the steady noise is louder. Car alarms are a variable noise. In 1970, British acoustician Douglas Robinson developed a formula to account for the increased impact of variable noise. Robinson's Formula states LNP = LEQ + 2.56 * Sigma. LNP is the Noise Pollution Level, that is, the level at which a constant noise would be as annoying as the varying noise. LEQ is the mean noise power intensity converted to dBA. And Sigma is the standard deviation of the noise intensity in decibels.

Robinson's Formula increases the impact of the car alarm noise by approximately 10 dBA.

25 dBA + 10 dBA = 35 dBA

N = 35 dBA

STEP 4: NDI

The Noise Depreciation Index is a numerical measure of the degree to which additional noise in an environment degrades its utility value. The estimate we use here is 1.0% per dBA. In other words, for each increase of one decibel of noise, a New York City resident's life productivity and enjoyment declines 1%. The Noise Depreciation Index is a well-established concept in measuring the impact of transportation noise and 1% is a conservative NDI figure compared to property value studies done near airports and other studies.⁴³

NDI = .01

STEP 5: HOW MUCH IS A NEW YORK MINUTE REALLY WORTH?

(V * APF) * (N * NDI) = One minute's worth of car alarm damage to the average New York City resident.

(6.5 cents * 5) * (35 dBA * .01) = 11.375 cents

One minute's worth of car alarm costs the average New Yorker about 11 and a half cents worth of life enjoyment and productivity.

STEP 6: FACTORING IN TA'S SURVEY DATA

Transportation Alternatives recently conducted an online survey about car alarms. Over 800 New York City residents responded to the survey. Among other questions, we asked how many car alarms people typically hear each week, and how long each alarm typically lasts. The survey revealed the following:

7.5 = Median number of alarms the average New York City resident hears per week.
2.5 minutes = Median duration of alarm blast.

7.5 * 2.5 = 18.75

The average New York City resident endures approximately 18.75 minutes of car alarm noise per week.

11.375 cents / minute * 18.75 minutes = $2.13

Car alarm noise costs the average New York City resident $2.13 / week.

$2.13 / week * 52 = $110.76

The average New York City resident pays a car alarm "Noise Tax" of approximately $110.76 per year.

Let's assume that 50% of New York City's 8,000,000 residents are deaf, too young, too old or have some other issue that prevents them from ever hearing or being bothered by a car alarm. The affected population is 4,000,000.

4,000,000 * $110.76 = $443,040,000 / year.

$443,040,000 = Annual cost of car alarm damage to New York City residents.

STEP 7: INSURANCE DISCOUNT VERSUS THE NOISE TAX

New York State residents pay, on average, $189.56 per year for the "comprehensive" portion of their auto insurance.⁴⁴ (Comprehensive coverage insures cars against theft, fire, flood, windstorm, vandalism, and falling objects.) These rates are generally much higher in urban areas, where theft is more common. Citywide data for New York are not available; however, we know that in the urban District of Columbia, which had 133 thefts per thousand cars in 2001, the average comprehensive premium was $227.23.⁴⁵ That same year, New York City reported only 18 thefts per thousand cars.⁴⁶ It is therefore unlikely that comprehensive rates in the City would be higher than in Washington; still, to be conservative, let's assume that the rates here are twice the state average: $379.12.

Though State law does not require it, a number of insurance companies provide discounts on comprehensive coverage for New York City car owners who use car alarms. Some insurance companies, notably MetLife, do not offer discounts for car alarms since there is no evidence that they work to reduce theft. The typical car alarm discount is 5%.

$379.12 * 5% = $18.96.

$18.96 = Average annual car alarm insurance discount for a New York City car owner.
$110.76 = Average annual car alarm cost to all New York City residents.

Appendix B: Legal Authority of New York City to Ban Audible Car Alarms

^* This work is based on a model developed by economist Charles Komanoff and Howard Shaw, Ph. D. in their report, Drowning in Noise: Noise Costs of Jet Skis in America. The report was commissioned by the Noise Pollution Clearinghouse and can be found here: http://www.nonoise.org/library/drowning/. Komanoff also worked closely with TA to develop the Car Alarm Noise Cost Model in this report. It should be noted that we are still working to hone our Cost Model. Please be sure to refer to the numbers you find in this draft of the report as an "estimate."

⁴³Mark A. Delucchi and Shi-Ling Hsu, “The External Damage Cost of Direct Noise from Motor Vehicles: Details by Urbanized Area,” Institute of Transportation Studies, Publication No. UCD-ITS-RR-96-03 (14A), December 1996.

⁴⁴National Association of Insurance Commissioners, "State Average Expenditures and Premiums for Personal Automobile Insurance in 2000," provided by the Insurance Information Institute, New York. The rest of a car insurance policy ("no-fault," liability, uninsured motorists, collision, etc.) is of course much more expensive, but the car alarm discount does not apply to these portions.

⁴⁵Ibid.

⁴⁶The National Insurance Crime reports that 28,998 cars were stolen from Washington, D.C. in 2001, and 34,680 from New York City ("NICB Vehicle Theft Study," April, 2002). The U.S. Census reports that there are 218,718 privately owned cars in Washington D.C., and 1,897,426 in New York City (U.S. Census Bureau, Census 2000: Supplementary Survey Summary Tables, "Table H041: Tenure by Vehicles Available").