Civil Engineering Reference
In-Depth Information
tive; special consultants' fees; mock-ups; special testing; etc.
All investment costs are computed as of the bid date and are as-
sumed to occur at the beginning of Year 1 of the analysis period (eco-
nomic life).
Loan Factors
With funds that have accrued under a sinking fund plan, there is
no interest expense since no borrowed funds are required to implement
the required replacement or renovation. But, a loan, if required, must be
amortized over its established term with the defined interest rate applied.
Therefore, for these projects, two factors must be known and included in
the analysis:
1. What percentage of the project cost is provided from loan funds?
This can range from 0 to 100%.
2. What is the bond interest rate and term?
Energy Cost
The estimation of energy cost associated with an alternative requires
that two quantities be known: (1) the amount of each source of energy
expected to be consumed annually for the alternative and (2) the unit cost
or rate schedule for each energy source. The second quantity is relatively
easy to determine by contacting the utilities serving the site or, for some
campus facilities, obtaining the cost for steam, power, chilled water, etc.
that may be furnished from a central source.
Economic Life Determination
Table 2-1 provides design service life factors that can be used as the
“economic” life of a component.
Maintenance and Replacement Considerations
Estimates of routine preventative maintenance costs and periodic
replacement or renovation requirements can be made using the data from
this text.
Inlation
As discussed above, construction cost inflation is almost always
greater than the general inflation rate and, thus, it is good planning to
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