Final Regulatory Assessment and Final Regulatory Flexibility Analysis Final Rule - Nondiscrimination on the Basis of Disability by Public Accommodations - Movie Theaters; Movie Captioning and Audio Description

Table 4-1 : Total Costs by Cost Category in Primary Analysis Over 15 Years ($ millions)

Overall, the total acquisition costs for equipment (captioning hardware, audio description hardware, captioning devices, and audio description devices) amounted to approximately $33.2 million when discounted by 7 percent, and $38.1 million when discounted by 3 percent. 

As Table 4-1 indicates, captioning equipment acquisition costs comprise the majority of the total acquisition costs incurred by movie theaters.  This is because most captioning hardware is capable of providing audio description with little additional cost, and the scoping requirements for audio description equipment are lower than those for captioning equipment, as summarized in Section 3.3.  Additionally, captioning equipment is more costly than audio description equipment (Section 3.4).

Installation costs are directly linked to the equipment acquisition costs that movie theaters incur and are expected to total $1.0 million over the 15-year period of analysis.  Replacement costs over the 15-year period of analysis account for $36.1 million of the total costs when discounted at 7 percent, and $49.9 million when discounted at 3 percent.  The assumptions regarding hardware and device replacement rates are outlined in Section 3.6.  When discounted at 7 percent, the total training costs are approximately $9.9 million, and maintenance and administrative costs are $8.2 million.  For further detail, the annual costs by cost category in the primary analysis are presented in Table 8-1 of Section 8.1 of the Appendices.

The total costs are broken down by venue type in Table 4-2.  Auditoriums in Multiplex movie theaters account for more than half of the total costs ($45.7 million) over the 15-year period of analysis.  As discussed in Section 3.1.2, Multiplex movie theaters operate approximately 52 percent of all auditoriums.  This percentage is also expected to grow over the course of the analysis (Section 3.1.3)

Overall, the cost to Single-Auditorium movie theaters is approximately $5.3 million when discounted at 7 percent, and $6.3 million when discounted at 3 percent.  As detailed in Section 3.4.5, the primary analysis assumes that no Single-Auditorium movie theater is already equipped to provide closed movie captioning or audio description.  As a result, it is assumed that all Single-Auditorium movie theaters subject to this rulemaking would need to purchase the necessary captioning and audio description equipment. 

Table 4-2 : Total Costs by Venue Type in Primary Analysis Over 15 Years ($ millions)

In Table 4-3 below, the annualized costs are presented by venue type under 7-percent and 3-percent discount rates.  Overall, the annualized cost to the entire movie exhibition industry is $9.7 million when using a 7-percent discount rate, and $9.5 million when using a 3-percent discount rate.

Table 4-3 : Annualized Costs by Venue Type in Primary Analysis ($ millions)

Figure 4-1 shows the total costs per year over the period of analysis when discounted at 7 percent.  The highest costs occur in the first two years of the analysis when movie theaters incur upfront costs for equipment acquisition and installation in accordance with the 18-month compliance date.  The figure also shows an increase in costs in the years 2025 through 2027, which results from the costs associated with replacing captioning and audio description hardware as described in Section 3.6.1. 

Figure 4-1 : Annual Costs in Primary Analysis, Discounted at 7 percent ($ millions)