IMS-005/CW-1
CENTRALIZED I/M PROGRAM
COST CALCULATION WORKSHEET
August 1979
Inspection and Maintenance Staff
Emission Control Technology Division
Office of Mobile Source Air Pollution Control
U.S. Environmental Protection Agency
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Centralized I/M Program
Cost Calculation Worksheet
This worksheet is designed to allow I/M program administrators to
project total costs of a centralized program at early stages of planning.
The factors involved in initial and annually recurring costs are systema-
tically organized to compute an annual inspection fee which will cover
all program costs for the total length of the program. Options are pro-
vided which allow this worksheet to be used for either a state-or a con-
tractor-operated program. There is a separate package for projecting
costs of a decentralized, private garage based program. Costs of separ-
ate fleet inspections as part of the I/M program are not considered in
any of the worksheets. It is assumed that costs of administering such
a fleet inspection program would be covered by permit fees to fleet
owners.
The worksheet computations obviously depend heavily upon assumptions
made by the user. Since in many cases users will not have detailed
information, estimates have been provided which may be substituted to
allow rough calculations. An example is worked through in the text of
the instructions using those estimates. It is absolutely essential that
users recognize that the suggested estimates are not intended to apply
to every program. They merely provide a reasonable approximation where
no better data is available, and worksheet users are expected to use
their own best judgement in applying or adjusting them to their own
program. Users should adapt the worksheet to meet their own program's
unique structure.
To use the worksheet set, remove it as a unit from the back of this in-
struction package. Set the pages alongside the instructions, for easy
cross-referencing as progress is made through the calculations. Flip
through the pages while reading the following introductory summary.
.This will allow a sense of the overall organization.of the worksheet and
make the logic of the calculations more coherent. It is also a good
idea to make several copies of the worksheet itself, particularly if
users want to compare several program options or various basic assump-
tions for their effect on the inspection fee.
The organization of the worksheet set is as follows: First, assumptions
which are basic to the cost calculations are enumerated and coded for
easy reference as progress is made through the worksheet (section
t.A.). From some of these assumptions, basic program parameters are
calculated (I.B.). For example, the annual average auto population
(AAP) is calculated on the basis of the current population (POP), the
estimated annual growth rate (CRT), and the program length (PRL). This
result is used as the basis for the program requirements, since provi-
sion must be made for more than the current population.
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-2-
Initial costs to the program operator are then calculated (section II).
Inspection facility requirements are estimated for land, construction,
and personnel (II.A.), and from these requirements, costs are calculated
for those and other facility investment costs (II.B.). Administrative
startup costs are estimated for personnel and other elements (II.C.).
Inspection facility and administrative initial costs are then organized
into categories of length of depreciation period, and summed for total
initial costs (II.D.).
Recurring costs are calculated in separate categories for personnel
costs of central administrative staff and inspection facility staff
(III.A.), and other annually recurring costs (III.B.). These are
calculated on a present dollar basis.
Both initial and recurring costs to the program operator are then
"annualized" to take into account inflation and interest costs (section
IV.). Recurring costs are multiplied by a factor which provides for the
average effect of a constant rate of inflation (IV.A.). Initial costs
are amortized on the basis of the assumed depreciation periods and
interest rate on borrowed capital (IV.B.). The annualized costs are
summed to present total average annual cost to the program operator
(IV.C.).
From this point on procedures are different for contractor-operated
programs than for state-operated. For the state-operated option, the
total annualized costs are divided by the annual average vehicle popula-
tion, to yield the cost-covering inspection fee for the life of the
program (V.A.). For the contractor-operated option, the contractor's
net return must be added to the contractor's costs of operating the
program (V.B.), and costs to the state for administration and monitoring
of the program must also be added (section VI).
Additional costs to the state for a contractor-operated program are
computed in three stages: First, the state's requirements for field
personnel to monitor inspection facilities is evaluated (VI.A.). This
.evaluation includes both the estimate of recurring annual salary costs
and of initial training and hiring costs. These initial field personnel
costs are added to other startup costs to yield total initial costs to
the state (VLB.). The recurring field personnel costs are added to
other recurring costs to yield total recurring costs to the state
(VI.C.). Initial and recurring costs to the state are then annualized
and summed (VI.D.), as costs to the contractor were in section IV.
Finally, total annualized costs to the contractor and those to the state
are combined, and divided by the average annual auto population (section
VII), to yield the cost covering inspection fee for a contractor-oper-
ated program.
The example worked through in the instruction text is that of an imaginary
city called "Smogville". The Smogville program will employ an idle mode
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test and will be operated by a private contractor. Other assumptions
made by the Smogville program administrators will be pointed out in the
instructions.
I. PROGRAM PARAMETERS
A. Assumptions
1. Present Auto Population (POP); This will be a function of
the geographic areas to be covered by the program and their
population densities, commuting patterns relative to neigh-
boring jurisdictions, and concentrations of vehicles subject
to the inspection program. Subject vehicle classes may be
defined by weight and model year ranges, or other character-
istics, or by exclusion from exempt vehicle categories. The
information needed to derive this figure can usually be pro-
vided by the area planning commission, highway patrol or motor
vehicle authority. In Smogville, the current auto population
is 750,000.
2. Annual 'Auto Population Growth Rate (CRT); This can be
determined over the projected life of the program by use of
motor vehicle department records, census data, transportation
planning data, survey information, etc. The Smogville auto
population is growing, at the rate of 2.6% per year.
3. Annual Inflation Rate (INF); Economists' estimates range
anywhere from 5% to 10% or more. Smogville administrators
anticipate a rate of 8%.
4. Annual Interest Rate (INT): Lending institutions typi-
cally set interest rates about 3.5% higher than the inflation
rate, subject to the constraints of the market. Ten to twelve
percent is a reasonable estimate at present, if area-specific
information is not available. Occasionally, public projects
can obtain slightly lower than commercial rates, e.g., through
bond issues. "Smogtesters, Inc.," the contractor for the
Smogville program, is expecting to pay a rate of 12%.
5. Program Length (PRL): Estimates will vary for each pro-
gram. The program may be set up in segments of five years if
it is not clear how long the program will be required. In
that case, use the length of the planning segment. Smogville
is using a five-year planning segment.
6. Annual Operating Hours (HRS); This is the number of
operating hours per year for the inspection facility lanes.
Eight hours daily for 250 days per year would yield 2,000
operating hours. Ten hours daily would yield 2,500 hours.
The Smogville program intends to make optional use of its
facilites, and will keep each lane open twelve hours per day,
six days per week, for fifty weeks per year, totaling 3,600
hours per lane per year.
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Cost Calculation Worksheet: I/M Program
Generalized Lane Program: State of 'Jontractor Operated
I- PROGRAM PARAMETERS
A. Assumptions
1..
2.
3.
4.
5.
6.
7.
8.
9.
10.
11.
12.
13.
14.
15.
16.
17.
18.
19.
POP = Present Auto Population
CRT •» Annual Auto Population Growth Rate (%)
INF = Annual Inflation Rate (%)
INT = Annual Interest Rate (%)
PRL = Program Length (.yrs)
HRS = Annual Operating Hours
Cars/hr = Hourly Lane Throughput
STR = Stringency Factor (%)
-a., fa
7%
3o
XTR = Annual Percent Additional Tests
$LAND/ft2
$CONS/ft2
(%)
Land Acquisition Cost per square foot
Construction Costs per square foot
T
$PAVG/ft'~ = Paving Costs per square foot
Mech/1,000 = Mechanics Required per 1,000 autos
SMCH = Training Cost per Met-.hanic
$IPI = Initial Public Information Costs
$RPI = Recurring Public Information Costs
$IDE = Initial Program Design, Eng. & Eval.
$RDE = Recurring Program Design, Eng. & Eval.
CPT " Computer Processing Cost Per Test
20. PRT = Property Tax Rate per Full Value (contractor
program only)
B. Parameter Calculations
1. Average Annual Auto Population = AAP
PRL-1
I (1-K5RT)
(POP) x
PRL
2. Average Annual Tests Performed ° TST
AAP (1 + STR + XTR) •= f, Ofc ?/
3. Annual Lane Capacity ° CAP
HRS x Cars/hr
TST
CAP
-P-
4. Total Test Lanes Required ° LAN
TST
CAP
LAN
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(I.A., cont.)
7. Hourly Lane Throughput (Cars/hr.); Factors to be taken
into account in projecting the number of autos each lane can
inspect per hour include test mode employed (loaded vs. idle,
use of tachometer, parameter or safety inspection, etc.), data
handling techniques (automated vs. manual, etc.), ineffi-
ciencies of scheduling, personnel, weather, mechanical diffi-
culties, and so forth. Table 1 suggests hourly lane through-
puts for three general test formats, including ranges of
efficiency. Smogville planners expect a throughput of around
12 cars per hour.
T.'ibii: 1
VohicJc ,J.h£iHi)'.hpMl (Cf'ril_PS:r_JllliII.l) !'>' Prorram Format
Program OptJiMl Projected
Format. Throughput Efficiency Throughput
State/City -
operated idle- 20-25 50-63Z 10-16
mode test using
tachometer
State/City -
operated idle .. 30-36 50-64% 15-23
mode test with
safety inspection
no tachometer
Contractor - 20-22 61-65% 12-14
operated
loaded mode
test
8. Stringency Factor (SIR); The stringency factor to be
applied is derived from EPA's MOBILE1 program for calculating
program benefits. It corresponds to the percent of autos that
would be expected to fail the emissions criteria if there were
no I/M program. In Smogville the stringency factor is set for
30%.
9. Annual Percent Additional Tests (XTR); In addition to
first-time failures (projected by stringency factor), extra
tests will be run for second-time failures, change-of-owner-
ship situations, free retests, post-repair checkups, etc.
Smogville projects that this will amount to about 5% of the
vehicle population.
2
10. Land Acquisition Costs per Square Foot ($LAND/ft ): Land
acquisition costs vary widely from locale to locale. Local
estimates should be obtained including possibilities of leasing
site acreage. Table 2 gives an idea of the variation in land
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(I.A., cont.)
costs among several existing programs and proposals. Ob-
viously, where program operators can utilize land they already
own or can convert existing facilities, these costs will be
much lower. In Smogville, Smogtesters Inc. will be able to
purchase commercial land at $2.50 per square foot.
Table 2
Price Variarion in Land Acquisition Costs
I,o en 1:1 on
Chicago
Denver
Portland
>iew Jersey
Ciiic. Jnnati
Si . Louis
Ivan Gas
Town
Nebraska
Year
1974
1974-75
1975
1975
1976
1976
1978
197C
1978
Coat per Square- Foot
$4.00
$2.00-3.00
$2.75
$.1.00-9.00
$0.92
$1.00-30.00
$3.15
$0.93
$0.81
2
11. Construction Costs per Square Foot (CONS/ft ): Construc-
tion of testing facilites should include office, storage and
lab areas, and should account for possible expansion of
facilities or changes in test mode. Specifications considered
should include:
Steel Frame Overhead Doors Forced Air MVAC
Concrete Floor Painted Walls Underfloor and Roof
Finished Office Small Restrooms Exhaust System
Estimates of construction costs range around $26 - $35 per
square foot. Again, use of existing facilites will lower
these costs. In Smogville, such construction can be performed
for $26 per square foot.
2
12. Paving Costs per Square Foot ($PAVG/ft ); Present estimates
range around $1.00 per square foot. Smogville will use this
estimate.
13. Mechanics Required per 1,000 Autos (Mech/1,OOP); Estimates
range from 2-6 mechanics required per 1,000 autos. These are
private mechanics who will perform emissions-related repairs
on vehicles failing the inspection. Smogville anticipates the
need of 3 mechanics for every 1,000 autos.
14. Training Cost per Mechanic ($MCH); Current estimates
suggest a range of about $15-20 for supplies, teaching equip-
ment and instructor salary for an 8-10 hour course, and admin-
istration of the examination and certification process by the
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(I.A.14, cont.)
state. It would not include mechanics' wages for the period
of the course. In programs where mechanic training costs are
not completely paid by the state, this figure should include
only that part paid by the state. Smogville planners are
considering a more extensive course, to be sponsored by the
state, at $30 per mechanic.
15. Initial Public Information Costs ($IPI): These may include
expenditures for testing clinics or demonstrations, media
spots, mailings, advertisements, literature, workshops, contact
with public interest groups and officials, and so on. Some
consultants have suggested that this may amount to up to $.29
per vehicle, although most existing programs allocate quite a
bit less to public information. Still, public information
continues to gain greater credit for its role in enabling
programs to succeed. Many planners would prefer to budget
this item as a lump sum rather than as a per-auto cost.
Either format is usable for the worksheet. Smogville planners
prefer to budget a lump sum of $125,000.
16. Recurring Public Information Costs ($RPI): Public Infor-
mation efforts should be maintained throughout the program,
including several of the items listed above, such as mailings
and advertisements. To some extent it may be possible to
minimize these costs by, for example, including I/M program
information in other motor vehicle department mailings. Some
consultants have suggested $.10 per vehicle annually; and
again this is more than considered necessary by most currently
operating programs. Once more, this assumption can be listed
either as a per-vehicle cost or as a recurring lump sum cost,
which may be calculated as, say, a fraction of initial public
information costs. Smogville planners conceive this cost in
the range of $.10 per auto.
17. Inital Program Design, Engineering and Evaluation ($IDE):
This item accounts for functions beyond those of the normal
administrative staff, which are handled elsewhere in the
worksheet. Such functions as research and development,
program planning, system design and analysis, etc., are often
contracted or subcontracted out to a separate firm, or can be
performed by a small auxiliary or temporary staff. This item
may also include software development. On a per vehicle
basis, $.15 to $.25 is suggested for this item. Sroogville
planners prefer to consider this as a lump sum, and are
budgeting $150,000 for this purpose.
18. Recurring Program Design, Engineering and Evaluation ($RDE):
This is the extension and updating of initial program design
functions and evaluation performed beyond the scope of the
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-8-
(I.A.18, cont.)
regular administrative staff. Some programs will prefer to
simply incorporate this item with normal staff functions.
Smogville is taking this approach and budgeting no funds
separately for this function. Other programs will want to
maintain a small extra engineering and evaluation project, and
an estimated cost for this is about $.05 to $.08 per auto.
(Can also be projected as a lump sum).
19. Computer Processing Cost per Test (CPT); This cost category
is provided for situations where costs of software development
and revision, data storage and retrieval, and computer time
are not accounted for separately. For example, if a program
does not purchase its own complete data processing system,
(costs of which are handled elsewhere), this item could account
for fees to a commercial timesharing system. In other cases
costs of computer processing of test results may be distri-
buted among normal duties for the administrative data analysis,
statistical, and clerical staffs, and software development may
be considered part of initial program design. The worksheet
is designed so that any of these planning concepts may be
applied. Smogville planners believe that computer processing
costs are accounted for in other planning categories and are
budgeting no separate funds for this. $.05 to $.15 per test
is estimated for other situations, with costs varying as a
function of the sophistication of the data processing program.
20. Property Tax Rate per Full Value (PRT); This assumption
is necessary only for a contractor-operated program. Property
tax rates generally range from 2% to 4%, sometimes reaching as
high as 5%, of full value of land, improvements and capital
installations. The best information on rates, of course, is
obtainable from the local tax assessor. Keep in mind that the
rate is often fixed for a less than full-value assessment, in
which case the full-value rate is to be derived by taking the
proportion of the millage rate equivalent to the assessed
proportion of full value. Smogville tax rates are 6% of
assessed value, with assessment at 50% of full value. This
yields a full-value rate of 3%.
B. Parameter Calculations
1. Average Annual Auto Population (AAP); The average annual
population, rather than the maximum, is used as the basis for
requirements calculations for a given planning segment. This
will minimize both underutilization and overutilization of
facilities. The function shown on the worksheet yields the
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(I.B.l, cont.)
average annual population by computing the populations for
each year of the program, and dividing the sum by the length
of the program planning segment. Over-utilization is the
conservative approach.
2. Average Annual Tests Performed (1ST): This function adds
retest rates to the average annual population, to project the
average number of tests to be performed annually. Actually
this number may slightly overestimate, since in later years
auto owners may adjust to more regular maintenance and fail
less frequently. However, this effect is unpredictable, and
in any event only signifies less over-utilization of facilities
in the later years of the planning segment.
3. Annual Lane Capacity (CAP); The hourly throughput rate,
times the operating hours per year, yields the annual capacity
of each inspection lane.
4. Total Test Lanes Required (LAN): Divide the annual number
of tests by the capacity of each lane, to find the total
number of inspection lanes required. If test vans or mobile
facilities are to be used, simply include these under the
category of test lanes for the time being. Since the cost and
usage of such facilities varies so widely, this worksheet does
not attempt to handle them directly. However, it can be
adjusted for that purpose. For example, the Smqgville program
will use two such mobile vans, each with that capacity of
about half that of a normal stationary lane. Thus the Smog-
ville requirement is 25 lanes, which will consist of 24
stationary lanes and 2x1/2=1 mobile lane.
II. INITIAL COSTS TO PROGRAM OPERATOR
A. Estimates of Facility Requirements
1. Facility Square Footage Requirements; The table presented
provides spaces for listing estimates of square footage
requirements for land, office and storage space, the inspec-
tion lanes themselves, and external paving. The table is set
up for easy computation using an "a(x) + b" formula, where "x"
is the number of lanes in a facility, "a" is the amount of
square footage in a certain category needed for each lane in
the facility, and "b" is a basic square footage requirement
needed for each facility, independent of the number of lanes.
For construction of dhe inspection lanes themselves, obviously,
there is only a per-lane requirement, and no basic facility
requirement.
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Centralized-2
II. INITIAL COSTS TO PROGRAM OPERATOR
A. Estimates of Facility Requirements
1. Facility Square Footage Requirements
Test
Mode
IDLE
LOADED
LAND
Basic per
Facility
fCOOO
ft2
Additional
per Lane
7-eoO ft2
LANES
(per Lane)
SoOft2
OFFICE, ETC.
Basic per
Facility
foe
Additional
per Lane
fee ft2
PAVING
Basic per
Facility
£eoeft2
Additional
per Lane
feeo ft2
2. Allocation of Lanes and Square Footage Requirements
LANE ALLOCATION
LAND
BUILDING
Lanns per
Facility
Mode
l> Facilities
This Size/Mode
Total
Lanes
Each
Facility
LANES
Total
Each Facility
Total
OFFICE, ETC
Each Facilitx
Total
PAVING
Each Facility Tjital
r*
Wooo
rttt.ooo
700
36
9 OOP
o
VAJUf )
701 AL
PAC = IP LAN
+• F M^Jiar
LND =
LNS
OFC
3. Inspection Facility Personnel Hiring and Training Requirements
f *» W^l
Position
Facility
Requirement
Annual
Salary
Duration
of Instruction
Direct Costs I Total
of Instruction! Training
per Trainee I Cost
Hiring Costs
per Employee
Total Training
plus Hiring
Station
Manager
1 per facility
s«/oo f/m
Asst. Station
Manager
Per facility or
r lane
Voo
ir
Inspection
Technicians
JfjaL
per Idle Mode lane
to
//To
»r
tnf
per Loaded Mode lane
Clerks
lane
So
>f
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-11-
(II.A.I, cont.)
Thus, given the estimates shown for the Smogville program, a
typical two facility requires (2,000) x (2) + (10,000) =
14,000 square feet of total land. Of this space, (500) x (2)
= 1,000 square feet for test lanes, plus (100) x (2) + (500) =
700 square feet for office space, etc.j is allocated to con-
struction. Another (1,000) x (2) + (5,000) = 7,000 square
feet is allocated to external paving for queuing area, employee
parking, etc. The remaining 5300 square feet is allocated to
landscaping. A minimum of 5% of the total land must be landscaped
for Smogville.
In programs where loaded and idle facilities are both used,
planners may want to use different requirement estimates for
each mode. Space is provided in the table for such use.
2. Allocation of Lanes and Square Footage Estimates: The
table presented in the worksheet is designed to allocate and
compute the total square footage requirements in each category
among the various size facilities 'to be built in the program.
First, at the bottom of the column marked "Total Lanes", write
the number derived in section I.E. (LAN) for the total lanes
required. In the first column, list various facility sizes
which might be used for the program. Allocate the total .
number of lanes among the various size facilities. Then add
to find the total number of facilities (FAC). In the Smog-
ville program, 25 lanes will be distributed among two- and
four-lane facilities, and the mobile vans will count for 1/2
lane apiece. For purposes of other (e.g., personnel) calcu-
lations they will also be counted as half-facilities. Thus
there are 10 full facilities, plus 2 half-facilities for a
total of 11.
Obviously, there are no land and construction square footage
requirements for the mobile vans. For each size of stationary
facility, the square footage requirements can be found by
applying the "a (x) 4- b" formula from the previous section.
Multiply the results for each facility size by the number
which will be that size, and enter the totals for all sizes
for each category on the bottom line.
3. Inspection Facility Personnel Hiring and Training Requirements;
In this table estimates are made of the number, types and
costs of personnel needed to operate the inspection facilities.
Four basic personnel categories are suggested, for simplicity
of calculation. Since Smogville stations will be open 72
hours per week, facility requirements for assistant station
managers and inspection technicians are slightly padded.
Personnel requirements that will vary with the size of the
facility are estimated on a per-lane basis, and fractional
estimates can be used to indicate overlapping or part-time
scheduling.
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(II.A.3, cont.)
In the Smogville program, direct costs of personnel instruc-
tion include course materials, overhead and instructors' fees.
Costs of the students' time at their hourly wage rate is added
to these costs to arrive at total training costs. Smogville
planners have chosen to estimate needs for assistant station
managers as a function of facility size, rather than merely
have one per facility.
B. Calculation of Facility Investment Costs
1. Construction and Land Acquisition Costs;
a. Multiply the total square footage requirement for
(from II.A.2.) by the assumed cost per square foot (from
I.A.), to yield total land acquisition cost.
b. Repeat step a. for paving costs.
c. The total construction square footage requirement
will be the sum of lane construction and office space
construction (from II.A.2.). Multiply this sum by the
assumed cost per square foot (from I.A.) to yield total
construction costs.
d. Building costs consist of the sum of paving and
construction costs. This item is distinguished because
its depreciation period will differ from both that of
land and that of other initial investments.
2. Inspection Facility Personnel Hiring and Training Costs;
a. Multiply the total training and hiring cost per
employee for station managers, taken from section II.A.3.,
by the number of facilities (assuming one station manager
per facility). For the Smogville program, each mobile
lab is counted as 1/2 facility for purposes of this
calculation.
b. Repeat step a. for assistant station managers.
Notice that for the Smogville program, however, the
number of assistant station managers was made a function
of the number of lanes. Therefore, a per-lane require-
ment is multiplied by the number of lanes as determined
in II.A.2., with each mobile van counting as 1/2 lane.
c. Some programs may mix test modes, and hiring and
training costs or requirements may be different for the
two modes. Spaces are provided for calculating inspection
technician costs separately for the two modes. Otherwise,
simply multiply the costs per employee, by the number of
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B.
Calculation"of Facility Investment Costs
1. Construction and Land Acquisition Costa
a. Land Acquisition - $LANDACQ - LND x $LAND/ft2
b. Paving - $PAVING - PVG x $PAVG/ft2
2.
c. Construction - $CONSTR - (OFC+LNS) x $CONS/ft •
d, Total Building - $BUILDING - $PAVING + $ CONSTR
3. Facility Preparation and Equipment Costs
Per
(Category)
Number
Site Preparation
Each
Total
Test Equipment
Each
Total
Centralized-3
Inspection Facility Personnel Hiring and Training Costs
a.
b.
Station Managers: . .
$ f 4O*7 x FAC O f I
Assistant Station Managers:
$ X FAC
or
d.
e.
Inspect lonTechnicians:
$ 1 ItX x JT.T x LAN [IDLE]
x LAN [LOADED]
x LAN
Clerks: $
TOTAL INSPECTION FACILITY PERSONNEL
HIRING & TRAINING - FIELDPERS
Office & Other Equlpmt.
Each
Tot.il
Dnt.i Processing Equlpmt.
Knch
T.M.I 1
TOT ••!
_ ^
-^0977
-
-**»
Facility
<7jfT
Soce
Idle Lane
To* a
Central
Office
/***£>
O 000
TOTAL
$EQUIP -
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(II.B.2,c, cont.)
employees per lane, by the total number of lanes for that
mode. Again, Smogvllle planners count mobile vans as 1/2
lane each.
d. Repeat for clerks. The per lane requirement and per
clerk costs will probably be the same regardless of mode.
e. Sum a. through d. to yield total initial hiring and
training costs for inspection facility personnel.
Remember that the number of employees per lane was increased
(padded) to handle a 72 hour work week.
3. Facility Preparation and Equipment Costs; The table shown
in the worksheet allows for both the listing of assumptions
and the computation of total costs for all inspection facility
investment costs beyond land acquisition, construction, and
personnel. The table is set up on a principle similar to that
of section II.A.2. (for square footage allocation). For each
category there is a basic cost assigned per facility independent
of the number of lanes, and an additional cost per lane to
account for the size of the facility. Other costs not covered
elsewhere in the worksheet may be considered in this table as
Central Office costs.
In the Smogville program, for example, most facility prepara-
tion and equipment costs will apply only to the stationary
facilities, and the mobile vans will be considered separately.
Site preparation costs will include landscaping, hookup of
utilities, etc. Test equipment will include analyzers,
calibration gases, probes, etc., and backup equipment. Under
the category "other equipment", the Smogville program will
list the purchase and outfitting costs of the four mobile
vans. Office equipment for the central administrative staff
will be listed under personnel costs as overhead, although it
could be listed here instead. Data processing equipment will
include terminals for each of the lanes, storage and retrieval
equipment for each facility, and a main central processing
setup, listed under central office provisions.
The total of these costs can be summed by cost category to
simplify an analysis of costs by category. Or all costs per
facility can be summed, that number multiplied by the number
of facilities, and the product added to all per-lane and per
central office costs, to simplify calculation.
C. Start-up Administrative Costs
1. Start-up Personnel: This is the staff that will initially
plan and set up the program. Since planning and set up may
last more or less than one year, personnel requirements are
stated in person-years.
-------
C. Start-Up Administrative Costs
1. Start-Up Personnel
I'osition Area
Program Administrators
Technical Officers
Data Analysis/Statistical Staff
Clerical and Secretarial Staff
Prs-Yr-
SUBTOTAL
Overhead, Fringe and Contingency
Cost
TOTAL
$CSP
D.
Total Initial Costs to Program Operator
1. Land Acquisition - $LANDACQ
2. Total Building = $BUILDING
3. Field Personnel Training and
Hiring = $FIELDPERS
4. Facility Preparation and
Equipment " $EQUIP •
5, Total Start-up Administrative Costs • $ADMIN •
6. SUBTOTAL
$FIELDPERS + $EQUIP + $ADMIN - $STARTUP'
7. Total Initial Costs
" $LANDACQ + $BUILDING + ^STARTUP
Cantralizca-4
2. Calculation of Start-Up Administrative Costs
a. Start-up Personnel = $CSP
b. Initial Public Information = $IPI
-PW
c. Initial Program Design, Eng. and Eval.
" $IDE
oo Q
d. Mechanic Training (State Operated Program Only)
Mech/1,000 x -~Q x $MCH
e. Total Start-up Administrative Costs
O_ (NO Depreciation)
(Depreciation over 20 years)
• $ADMIN
. Ln
I
VT7
(Depreciation over life
of Program)
-------
-16-
(II. C. ,cont.)
2. Calculation of Start-up Administrative Costs: These will
include all costs which are not facility investment costs.
a. Take the total figure for central administrative
start-up staff from the previous section, II. C.I.
b. Enter the total cost for initial program design,
engineering and evaluation. If this was listed as a
lump-sum assumption in I. A., enter that. If it was
listed as a per-vehicle assumption, multiply that by the
present auto population (POP), and enter the product.
c. Repeat step b. for initial public information costs.
d. This item is for a state-operated program only. For
a contractor-operated program, this cost will be computed
in a separate section for costs to the state, rather than
in this section. The number of mechanics needed per
thousand autos (Mech/1,000) is multiplied by the number
of thousands in the population. Multiplying by the
training cost per mechanic ($MCH) yields the total
initial cost of the mechanics' training program.
e. Total a,b and c for a contractor-operated program, or
a-d for a state-operated program, for total start-up
administrative costs to the program operator.
D. Total Initial Costs to Program Operator
1. Insert Land acquisition costs from II. B.I. a. These can be
said to retain full salvage value at the end of the program.
2. Insert building costs from II.B.l.d. These can reasonably
be said to depreciate over a period of 20 years.
3. Insert inspection personnel hiring and training costs from
4. Insert facility preparation and equipment costs from
II. B. 3.
5. Insert total administrative start-up costs from II.C.2.e.
6. Add 3, 4, and 5. This sum represents costs that can
reasonably be depreciated over five years or, alternatively,
the length of the program planning segment.
-------
-17-
(II.D., cont.)
7. Total initial costs to the program operator can be obtained
by adding 1, 2 and 6.
III. RECURRING COSTS TO PROGRAM OPERATOR
A. Personnel Costs
1. Central Administrative Staff: This is the group coordina-
ting and overseeing the entire program operation. Worksheet
users should adapt the table presented to their own conception
of the needed administrative staff structure.
2. Inspection Facility Operating Staff; These calculations
are made on the basis of estimates made in the table for
inspection personnel requirements, section II.A.3. As in
calculations for hiring and training costs of these personnel,
the Smogville program is introducing a per-lane requirement
for assistant station managers. Insert annual salary figures
where training and hiring costs had been used in computing
start-up costs. Overhead and fringe benefits are calculated
at a smaller percentage than for central administrative staff
for the Smogville program, because housing is not so elaborate
at inspection facilities and because office equipment for the
facilities is accounted for separately.
B. Miscellaneous/Total Recurring Costs
1. Support Services to Facilities: These costs may include
janitorial service, heating, electricity, linen and so forth,
if they are not otherwise covered under overhead costs or
equipment maintenance. They may be calculated using the
familiar format of a basic figure per facility, independent of
the number of lanes, plus a marginal factor for each lane in
the facility. In the Smogville program, planners considered
these costs to be handled under the categories of overhead and
equipment maintenance (see III.B.4.,), and therefore no cost
is listed here.
2. Travel; Smogville planners consider that to maintain
communication and efficient management, and to transport
supplies between the central office and the facilities, it
will be necessary to travel approximately 1500 miles per year
for each facility. At $.20 per mile, this is projected to
cost $300 per facility, including the mobile vans for the
Smogville programs.
3. Public Information; List a lump sum as estimated in the
assumptions, or multiply a per-vehicle assumption by the
annual average auto population (AAP) for recurring public
information costs.
-------
III. RECURRING COSTS TO PROGRAM OPERATOR
A. Personnel Costs
1. Central Operating Staff
Position Area
Program Administrators
Technical Officers
Data Analysis/Statistical Staff
Clerical and Secretarial Staff
Number
3 '
SUBTOTAL
Overhead, Fringe and Contingency (
too s
TOTAL = $CSTAFF
Cost
Centrftlized-5
Inspection Facility Operating Staff
a. Station Managers: $
d.
e. .
x FAC
b. Assistant Station Managers: $
CM)
_ x FAC
?_ * LANt*T)
Inspection Technicians:
$ t*6tV x ( g.
x LAN [IDLE
Clerks: $
SUBTOTAL
x LAN [LOADED] )
x
f. Overhead and Fringe Benefits ( X> %)
g. TOTAL INSPECTION FACILITY OPERATING STAFF
= $FSTAFF
00
1
-------
Centralized-6
IV. MINUALIZED COSTS TO PROGRAM OPERATOR
B. Miscellaneous Total Recurring Costs
1. Support Se.rvices to Facilities
$ basic per facility
$ additional per lane
TOTAL SUPPORT SERVICES = = SSUPT
2. Travel
$ d O • per facility C' ' / " J 5 O O •> $TRAV
3. Public Information
or SPPI X AAT •T*1%ff+* ° ' 75*?S"O = SAPUB
4. Equipment Maintenance
^5.1 x $EQUIP f4f7fOC> = r?^Sfet> -- $MAINT
5. Annual Program Design, /
Engineering and Evaluation = y9 . = ADESG
SRDE
or $RDE x AAP • *
. Computer Processing of Tests ^Jr
CPT x TST • - ^ . $CMPR
7. Insurance Costs (where applicable)
$ fi'ofc x LAN + f0C$xFAC- Y**«** ** ° $INS
8. Personnel Costs _.—
SCSTAFF + $FSTAFF - *f^^*^* * " $STAFF
9. Additional Mechanic Training (State Operated Program Only)
Mech/1,000 x ^=|9Z X$MCH f - $AMT
10. Property Taxes (Contractor Operated Program Only)
/ EBI :L.(SBUILDING+$LANDACO:t$EOUIP) - (*O t/ 5^ - $TAX
U.^Totlr*0*"*70*1'**'^'^***^ */ t ft
Recurring Costs " *T 5***>^O " $RECUR
A. Average Recurring^ Costs
Accounting for Inflation
For each item, take:
E (1 + INF)1 /
ITEM A ' 1=° T
PRL «J
* " SSUPT,
• • • i
* • STRAV.
i
•*• " SAPUB,
i
* - SMAINT.
•* - SADESG
* - SCMPR,
I
-* ' - SINS,
+ - $STAFF,
1
* 5*^^*L^^^ " SRECUR
(Does Not Include Amortization of Initial Costs)
-------
-20-
(III.B., cont.)
4. Equipment Maintenance; Recurring equipment maintenance
costs are estimated as a percentage of initial equipment
costs. Costs of upkeep on landscaping and mobile vans, data
processing equipment and so forth are all considered in a
single percentage in the Smogville program. 20% is taken of
the total initial expenditure derived in section II.B.3.
5. Recurring Program Design, Engineering and Evaluation:
Determine these as for public information costs. In the
Smogville program, administrators considered these costs to be
covered elsewhere in the worksheet.
6. Computer Processing of Test Results; Multiply the assumed
cost per test by the annual average number of tests, as deter-
mined in section I.B.2. In the Smogville program, these costs
are covered under equipment costs and regular staff functions.
7. Insurance Costs; This cost will apply to all contractor-
operated programs, but only to those state-operated programs
where states are not self-insuring. Insurance costs them-
selves vary in a manner too complex to be thoroughly repre-
sented in a simple worksheet. Elements to be taken into
account would include construction materials, location,
equipment utilized, and operating hours of the facilities. In
the worksheet, this is all reduced to a simple function in-
cluding a basic factor per facility, independent of the number
of lanes, and an additional factor for each lane in the facil-
ities. In the Smogville program, these are estimated at
$1,000 per facility and $1500 per lane.
8. Personnel Costs; Insert the recurring costs for personnel,
overhead and fringe benefits as determined in section III.A.
This includes the total of both central administrative staff
and inspection facility staff.
9. Additional Mechanic Training; This item applies to a
state-operated program only. The difference between the
average annual population (AAP) and the original population
(POP) gives the amount of annual increase in the population.
Additional mechanics need to be trained to cover this increase,
and the cost of training them is found by applying the same
formula as for initial training costs: i.e., multiply the per-
1,000 auto requirement by the number of thousands of new
autos, by the training cost per mechanic.
In some programs recurring costs of mechanic training will
include refresher courses for mechanics who have already
received special training. Worksheet users must add such
costs at their own discretion. In contractor-operated programs,
costs of mechanic training are included later under costs to
the state (unless the contractor administers the mechanic
training program).
-------
-21-
(III.3., cont.)
10. Property Taxes; This item applies to a contractor-operated
program only. The property tax rate as listed in the assumptions
applies only to land, buildings, equipment, and other site
improvements. Take these figures from section II.D., lines
1,2, and 4 only. Multiply the sum by the assumed rate per
full value.
11. Total Recurring Costs; Sum all of 1-10 above which are
. applicable to the program in question. This figure represents
the present-dollar value of yearly program operating costs,
once the initial capital investment is in place.
IV. ANNUALIZED COSTS TO PROGRAM OPERATOR
A. Average Recurring Costs Accounting for Inflation
The formula shown calculates a factor representing the average
annual cost differential due to inflation. At a rate of 7%,
the Smogville assumption, this factor would be 1.15. For
simplicity of calculation, merely multiply this, factor by the
total arrived at in section III.B., line 11. If the worksheet
will be used for more sophisticated analyses of cost elements
and their proportion of the inspection fee, multiply this
factor by each of the items listed in section III.B. individ-
ually.
B. Amortization of Initial Costs
General Formula
The general formula presented consists of a series of equa-
tions, broken up so that the computations being made are
transparent to the worksheet user. Through this formula, an
average annual payment is derived taking into account depre-
ciation, interest, salvage value, and inflation, for each of
three items distinguished by their depreciation schedule in
section II.D. (i.e.,.$LANDACQ, $BUILDING, and $STARTUP).
. 1. The first equation computes a cost item's salvage value at
the end of the program, as a proportion of the original cost.
The proportion used is that fraction of the item's deprecia-
tion period used up over the course of the program.
2. The second equation computes the present discounted value
of the item's salvage value at. the end of the program. The .
salvage value is divided by the interest factor compounded
over the length of the program.
3. The original value of the item, less the present dis-
counted salvage value, is the current value of the principle
to be paid off over the length of the program.
-------
Centralized-7
Q »
B. Amortization of Initial Costs *
General Formula Calculation for Specific Initial Cost Elements
1. DEPR = Depreciation Period of Item 1. Land Acquisition!
SITE* x JSgSk . VAE r^^Sr1"8 «° °—— V- - ^7CQ
(Landacq)
, VAE „_„ (Present Discounted Value „ _ ... ,. ._ ^.
2' nj.TMT>PRL °PDV of Item Remaining at end 2" »""«"«*: 9V SV6O
N1U °f Pr°8ram) DEPR -20 Yea«
$PM^Building)
3. SITEM -'PDV = PRIN (^"e °* ^"^P16 to be 3. Other Startup .. ,._„
. - Paid off Over Length of Program) c t^OVt^^
™Tn±^^'^F*L ti „ ,a1 Pnv™^^ DEPR = PRL! VAE = °'> PRIN = *$STARTUP
A PRTN x INT(1 + INT) = SPMT (Annual Payment &
(1«NT)PRL 1 $(Uem) of Initial Loan ^fiartup)
- \ r (Item) pl"S .Interest)
(NOTE: Interest Rate Already Accounts for Inflation) A. Total Annual Payment Plus Interest
For Initial Costs
C. Total Annualized Costs to Program Operator
$RECUR + $PAYMENT s JT. 90 T» tf^C* = $ANNUAL
V. DISTINGUISHING STATE FROM CONTRACTOR OPERATED PROGRAM
A. State Operated Program
- ft/*
B. Contractor Operated Program
$PAYMENT
I
ISJ
Inspection Fee •» ' — • 1 / T 1. Total Annualized Costs to Contractor
= $ANNUAL
2. Contractor's Net Return
3. Total Annualized Contractor's
Program Costs ~ $CON
- $CONTR
-------
-23-
(IV.B., cont.)
4. Multiplying the principle value by the factor given
yields the annual payment of principle and interest.
Calculations for Specific Initial Cost Elements
1. Land Acquisition; It is usually assumed that land does
not depreciate in value. The salvage value of the land at the
end of the program would therefore be equal to the original
cost (aside from the inflation factor, accounted for in the
second equation). "$LANDACQ" (from section II.D., line 1) can
thus be directly substituted for "VAE" in equation 2, eliminating
equation 1. In this case, the entire formula collapses into
simply "$LANDACQ x INT".
2. Building: Twenty years is traditionally assumed as the
depreciation period for buildings, although any depreciation
period may be substituted for "DEPR" in equation 1 of the
formula. For the Smogville program, a five year program
planning segment and twenty year depreciation period implies
that the salvage value of buildings ($BUILDING, from section
II.D., line 2) is 75% of initial costs.
3. Other Startup Costs; In the Smogville program, it is
assumed that all other startup costs (including startup admin-
istrative costs and inspection facility site preparation,
equipment, and personnel hiring and training costs) completely
depreciate over the five-year length of the program planning
segment. This implies that the present discounted salvage
value of these items at the end of the program is $0. '^START-
UP" from section II.D., line 6, can therefore be directly
substituted for ."PRIN" in equation 4.
4. The sum of the annual payments for each of the three items
listed is the annualized payment of initial costs, including
interest.
C. Total Annualized Costs to Program Operator
Add the annualized recurring costs (from IV.A.) to the annual-
ized initial costs (from IV.B.), for total annualized costs to
the program operator.
V. DISTINGUISHING STATE FROM CONTRACTOR-OPERATED PROGRAMS
A. State-Operated Program
The total annual inspection fee to motorists can now be deter-
mined for a state-operated program. Divide the total annual-
ized costs from section IV.C. by the average annual auto
-------
-24-
(V.A., cont.)
population (AAP) from section I.E., line 1.
B. Contractor-Operated Program
The annual net return to the contractor can now be determined
for a contractor-operated program. For the Smogville program,
Smogtesters, Inc., will receive a net return of 10% on the
total annualized costs determined in IV.C. 7% to 12% is
usually considered an equitable range for returns on such
contracts.
The worksheet user can determine at this point the part of the
inspection fee attributable to the contractor's operations, by
dividing the total annualized costs plus return to contractor,
by the annual average auto population.
VI. PROGRAM COSTS TO THE STATE (CONTRACTOR-OPERATED PROGRAM ONLY)
A. Inspection Facility Monitor Requirements
The table presented in the worksheet outlines requirements for
both initial and recurring costs, for state employees monitor-
ing the day to day operation of the contractor's inspection
facilities. Such monitoring will be necessary to guarantee
proper quality control and execution of the public trust. In
the Smogville program, the state plans to assign each monitor
responsibility for about four inspection facilities, and one
more will monitor all four of the mobile vans.
As in the table for training and hiring requirements for in-
spection facility personnel in section II.A.3., direct costs
of personnel instruction include course materials, overhead
and instructors' fees. Costs of the students' time at their
hourly wage rate is added to these costs to arrive at total
training costs.
B. Initial Costs to the State
1. Central Administrative Personnel; The state must oversee
and reinforce many functions covered by the contractor's
administrative staff, to safeguard the public trust and pro-
vide liason with other state offices. As for the contractor's
start-up administrative staff, requirements are stated in
person-years, since planning and set-up may last more or less
than a full year.
2. Total Initial Costs to the State;
a. The total program-wide costs of training and hiring
of inspection facility monitors, from section VI.A., is
inserted.
-------
VI. PROGRAM COSTS TO STATE (Contractor Operated Program Only)
Centrallzed-8
A. Inspection Facility Monitor Requirements
Individual basis
Program Total
B. ' Initial
Facility
Requirement
• >«* facility
• *Vj x FAC = ,!> .
Coses
Annual Salary
'St?-*
tAl7fc6= $FMS
Duration of Direct Cost of Total Total Training
Instruction Instruction Training Costs Hiring Costs plus Hiring
n4k vMLS Vott f O t *V '^'f t O »7
J^** . $FTRN
1. Central Administrative Personnel 2. Total Initial Costs to State
Position Area
Program Administrators
Technical Officers
Data Analysis/Statistical Staff
Clerical and Secretarial Staff
Prs-Yrs
f
f
*
f
SUBTOTAL
Overhead, Fringe
TOTAL
and Contingency (•nL. %)
Cost
^*H/*/^
I^OY?
tlor?
&8£V$
\\t •v,*y /
$CAPIN - f £>^ %ttf
a. Inspection Facility Monitor Training
- $FTRN - f t> >*
b. Central Administrative Personnel «,«*«» VJ
- $CAPIN - fGrl'O'
c. Initial Priy^e Mechanic Training
fech/1,000 x ^— £_ x $MrH - W f «» *
rf. Tnral Tnlt-lal flnara ro Sfnl-p • ",' *•
• $STW
Ui
I
-------
-26-
(VI.B.2, cont.)
b. Insert the total cost for the initial central admin-
istrative personnel from Section VI.B.I.
c. The cost to the state for initial training of private
mechanics is inserted here (rather than in section II.C.2.,
as it would be for a state-operated program). Multiply
the number of mechanics needed per thousand .autos, by the
number of thousands in the population, by the training
cost per mechanic, to yield the total initial cost of the
mechanics' training program.
d. Total a through c to yield the total initial costs of
the program to the state.
C. Recurring Costs to the State
1. Central Administrative Personnel; In the Smogville plan,
it is assumed that the start-up administrative staff will
simply continue to function in its role of overseeing the
contractor operation.
2. Total Recurring Costs to the State
a. Inspection Facility Monitors: (i) insert the total
program-wide annual salary cost from section VI.A. (ii)
Add a percentage of total salary for overhead and fringe
benefits, (iii) Add a factor for monitors' travel between
facilities and the state central office. This can be
calculated either on a per-facility or a per-monitor
basis. Smogville planners estimate 2,000 miles per year
for each monitor. At $.20 per mile, that comes to $400
per monitor.
b. Insert the total cost for the central administrative
personnel, from section VI.C.I.
c. The annually recurring cost of training additional
mechanics is found, by multiplying the assumed training
cost per mechanic, by the number of thousands of new
autos, by the number of mechanics required per thousand
autos. Refer to section III.B.9. for more detailed
explanation.
d. Total a through c to yield the total recurring costs
of the program to the State.
D. Annualized Costs to the State
1. Amortization of Inital Costs to the State; In the con-
tractor-operated program, the state makes no initial invest-
ments which will retain any salvage value at the end of the
-------
Centralized-9
JC. Recurring Costs
1. Central Administrative Personnel.
Position Area
Program Administrators
Technical Officers
Data Analysis/Statistical Staff
Clerical and Secretarial Staff
SUBTOTAL f ^,
Number
f
„
t
f
Overhead, Fringe and Contingency (C£.%)
TOTAL • $CAPAN «•
Cost
^WM*-
l^1r^\
til>9*
(* °°
d. Total Recurring Costs to State
= $STRC
VII. TOTAL OVERALL PROGRAM COSTS FOR CONTRACTOR OPERATED PROGRAM
A. Total Annualized Program Costs
$ STATE
$TOTL
B. Annual Fee to Motorists
Average Annual
Program Cost
per Vehicle
$TOTL
AAP
- Inspection
Fee
-------
-28-
(VI.D.I, cont.)
program. The amount of principle to be paid off over the
period of the program will therefore be just the amount of
total initial costs ($STIN), from section VLB.2., line d. If
the state is assumed to pay the same interest rate on borrowed
capital as the contractor, this equation will be identical to
equation 4 of the general formula presented in section IV.B.,
with "$STIN" substituted for "PRIN". The Smogville planners
do make that assumption.
2. Recurring Costs to the State Accounting for Inflation;
The inflation factor which is derived in section IV.A. should
be applied to the total recurring costs to the state, from
section VI.C.2., line d.
3. Total Annualized Costs to the State; Add the annualized
initial costs (from VI.D.I.) to the annualized recurring costs
(from VI.D.2.), for total annualized costs to the state.
At this point the worksheet user can determine the part of the
inspection fee attributable to the state's administration of
the contractor-operated program, by dividing the total annual-
ized costs to the state by the average annual auto population.
VII. TOTAL OVERALL PROGRAM COSTS FOR CONTRACTOR-OPERATED PROGRAM
A. Total Overall Annualized Program Costs
Add the total annualized costs plus return to the contractor
(from section V.B.) to the total annualized costs to the state
(from section VI.D.3.), for total overall annualized program
costs.
B. Annual Fee to Motorists
Divide the total overall annualized program costs from VILA.
by the average annual auto population, to yield the annual
inspection fee for the contractor-operated program.
-------
Cost Calculation Worksheet: I/M Program
Centralized Lane Program: Stace or uontractor Operated
I- PROGRAM PARAMETERS
A. Assumptions
B. Parameter Calculations
1. POP = Present Auto Population
2. CRT = Annual Auto Population Growth Rate (%)
3. INF = Annual Inflation Rate (%)
4. INT = Annual Interest Rate (%)
5. PRL = Program Length (yrs)
6. HRS = Annual Operating Hours
7. Cars/hr = Hourly Lane Throughput
8. STR = Stringency Factor (%)
9. XTR = Annual Percent Additional Tests (%)
2
10. $LAND/ft = Land Acquisition Cost per square foot
2
11. $CONS/ft = Construction Costs per square foot
2
12. $PAVG/ft = Paving Costs per square foot
13. Mech/1,000 = Mechanics Required per 1,000 autos
14. $MCH = Training Cost per Mechanic
15. $IPI = Initial Public Information Costs
16. $RPI = Recurring Public Information Costs
17. SIDE = Initial Program Design, Eng: & Eval.
18. $RDE = Recurring Program Design, Eng. & Eval.
19. CPT = Computer Processing Cost Per Test
20. PRT = Property Tax Rate per Full Value (contractor
program only)
1.
Average Annual Auto Population = AAP
PRL-1
(1+GRT)
(POP) x
i=0
PRL
AAP
2. Average Annual Tests Performed ° TST
AAP (1 + STR + XTR)
3. Annual Lane Capacity
CAP
HRS x Cars/hr
= TST
CAP
4. Total Test Lanes Required = LAN
TST
CAP
LAN
-------
Centralized-2
II. INITIAL COSTS TO PROGRAM OPERATOR
A. Estimates of Facility Requirements
1. Facility Square Footage Requirements
Test
Mode
IDLE
LOADED
LAND
Basic per
Facility
ft2
'" ft'
Additional
per Lane
ft2
LANES
(per Lane)
ft2
OFFICE, ETC.
Basic per
Facility
ft2
Additional
per Lane
ft2
PAVING
Basic per
Facility
ft2
Additional
per Lane
ft2
2. Allocation of Lanes and Square Footage Requirements
LANE ALLOCATION
Lanes per
Facility
TOTAL
Mode
# Facilities
This Size/Mode
FAC =
Total
Lanes
LAN = .
LAND
Each
Facility
Total
LND =
BUILDING
LANES
Each Facility
Total
LHS =
OFFICE,
Each Facility
ETC
Total
OFC =
PAVING
Each Facility
TVG =
Total
3. Inspection Facility Personnel Hiring and Training Requirements
Position
Station
Manager
Asst. Station
Manager
Inspection
Technicians
Clerks
Facility
Requirement
1 per facility
1 per facility or
pi>r lane
. _per Idle Mode lane
per Loaded Mode lane
per lane
Annual
Salary
Duration
of Instruction
Direct Costs
of Instruction
per Trainee
Total
Training
Cost
Hiring Costs
per Employee
Total Training
plus Hiring
-------
Centralized-3
B.
Calculation of.Facility Investment Costs
1. Construction and Land Acquisition Costs
a. Land Acquisition = $LANDACQ = LND x $LAND/ft2
b. Paving = $PAVING = PVG x $PAVG/ft2
c. Construction = $CONSTR = (OFC+LNS) x $CONS/ft2 =
d. Total Building = $BUILDING = $PAVING + $ CONSTR
3. Facility Preparation and Equipment Costs
Inspection Facility Personnel Hiring and Training Costs
a. Station Managers:
$ x FAC =
b.
Assistant Station Managers:
$ ' x FAC
x LAN
Inspection Technicians:
$ x x LAN [IDLE]
x LAN [LOADED]
x LAN
d. Clerks: $
TOTAL INSPECTION FACILITY PERSONNEL
HIRING & TRAINING = FIELDPERS
Per
(Category)
Facility
Loaded Lane
Idle Lane
Central
Office
TOTAL
Number
' '
Site Preparation
Each
Total
Test
Each
Equipment
Total
Office & Other Equipmt.
Each
i
Total
Data Processing Equipmt.
Each
Total
TOTAL
$EQUIP =
-------
Centralized-4
C. Start-Up Administrative Costs
1. Scart-Up Personnel
Position Area
Program Administrators
Technical Officers
Data Analysis/Statistical Staff
Clerical and Secretarial Staff
Prs-Yr»
SUBTOTAL
Overhead, Fringe and Contingency ( %)
Cost
TOTAL = $CSP =
D. Total Initial Costs to [Program Operator
1. Land Acquisition = $LANDACQ
2. Total Building = $BUILDING
3. Field Personnel Training and
Hiring = $FIELDPERS
4. Facility Preparation and
Equipment = $EQUIP
5. Total Start-up Administrative Costs = $ADMIN
6. SUBTOTAL
$FIELDPERS + $EQUIP + $ADMIN = $STARTUP
7. Total Initial Costs
• $LANDACQ + $BUILDING + $STARTUP
2. Calculation of Start-Up Administrative Costs
a. Start-up Personnel = $CSP
b. Initial Public Information = $IPI
or = $IPI x POP
c. Initial Program Design, Eng. and Eval.
= $IDE
or = $IDE x POP
d. Mechanic Training (State Operated Program Only)
Mech/1,000 x y^lg- x $MCH
e. Total Start-up Administrative Costs
(No Depreciation)
(Depreciation over 20 years)
(Depreciation over life
of Program)
= $ADMIN
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Centralized-5
RECURRING COSTS TO PROGRAM OPERATOR
A. Personnel Costs
1. Central Operating Staff
Position Area
Program Administrators
Technical Officers
Data Analysis/Statistical Staff
Clerical and Secretarial Staff
Number
SUBTOTAL
Overhead, Fringe and Contingency ( %)
Cost
TOTAL = $CSTAFF
Inspection Facility Operating Staff
a. Station Managers: $
x FAC
b. Assistant Station Managers: $
or $ x
x FAC
x LAN
Inspection Technicians:
$ x (
x LAN [IDLE]
x LAN [LOADED] )
d. Clerks: $
SUBTOTAL
f. Overhead and Fringe Benefits (_
x LAN
TOTAL INSPECTION FACILITY OPERATING STAFF
$FSTAFF
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Centralized-6
IV. JINNUALIZED COSTS TO PROGRAM OPERATOR
B.
1.
$
$
2.
$
3.
4.
5.
Miscellaneous Total Recurring Costs
Support Services to Facilities
basic per facility
additional per lane
TOTAL SUPPORT SERVICES
Travel
per facility = =
Public Information
$RPI
or $RPI x AAP ~ ~
Equipment Maintenance
,% x $EQUIP
Annual Program Design,
Engineering and Evaluation = =
6.
7.
8.
9.
10.
11.
SRDE
or $RDE x AAP
Computer Processing of Tests
CPT x TST
Insurance Costs (where applicable)
$ x LAN + x FAC =
Personnel Costs
$CSTAFF + $FSTAFF
Additional Mechanic Training (State Operated Program Only)
M^.ii/i rinn v "A ,.?__?. „ CMCMI
Property Taxes (Contractor Operated Program Only)
PRT x ($BUILDING+$LANDACQ+$EQUIP) = .
Total .' ' . ' ' .
Recurring Costs = ' =
A. Average Recurring Costs
Accounting for Inflation
For each item, Egj^e:
E (1 + INF)1
ITEM x ~-°
J.1LM A pRL
$SUPT ->• = $SUPT,
• • i
$TRAV -*• = $TRAV
$APUB -* = $APUB.
Y i
$MAINT -> = SMAINT,
v ±
ADESG -»• = $ADESG
$CMPR * = $CMPR
. i
$INS ->• ' = $INS,
$STAFF -»- = SSTAFF,
$AMT •* = $AMT,
$TAX -> = $TAX,
$RECUR •* = $RECUR.
(Does Not Include Amortization of Initial Costs)
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Centralized-7
B. Amortization of Initial Costs
General Formula
1. DEPR = Depreciation Period of Item
$ITEM x '•
DEPR-PRL
DEPR
VAE
(Value of Item Remaining
at end of Program)
2.
VAE (Present Discounted Value
PRL of Item Remaining at end
(1+INT)
3. $ITEM - PDV = PRIN
4. PRIN x
INT(1 + INT)
of Program)
(Value of Principle to be
Paid off Over Length of Program)
PRL
PRL
SPMT (Annual
(Item) °f Initial Loan
(Item) Plus Interest)
(1+INT)
(NOTE: Interest Rate Already Accounts for Inflation)
Calculation for Specific Initial Cost Elements
1. Land Acquisition:
No Depreciation; VAE = $LANDACQ
(Landacq)
2. Building:
DEPR = 20 Years
$PMWlding) =
3. Other Startup
DEPR = PRL; VAE = 0; PRIN = $STARTUP
4. Total Annual Payment Plus Interest
For Initial Costs
$PAYMENT
C. Total Annualized Costs to Program Operator
$RECUR + $PAYMENT *
$ANNUAL
DISTINGUISHING STATE FROM CONTRACTOR OPERATED PROGRAM
A. State Operated Program
$ANNUAL
Inspection Fee
AAP
B. Contractor Operated Program
1. Total Annualized Costs to Contractor
= $ANNUAL
2. Contractor's Net Return = %
3. Total Annualized Contractor's
Program Costs = $CON
$CONTR
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VI. PROGRAM COSTS TO STATE (Contractor Operated Program Only)
A. Inspection Facility Monitor Requirements
Centralized-8
Individual basis
Program Total
Facility
Requirement
per
facility
x FAC =
Annual Salary
= $FMS
Duration of
Instruction
Direct Cost of
Instruction
Total
Training Costs
Hiring Costs
Total Training
plus Hiring
= $FTRN
B. Initial Costs
1. Central Administrative Personnel
Position Area
Program Administrators
Technical Officers
Data Analysis/Statistical Staff
Clerical and Secretarial Staff
Prs-Yrs
SUBTOTAL
Overhead, Fringe and Contingency ( %)
Cost
TOTAL $CAPIN
2.
Total Initial Costs to State
a. Inspection Facility Monitor Training
and Hirinc
b. Central Administrative Personnel
c. Initial Private Mechanic Training
= $FTRN
= $CAPIN
Mech/1,000 x
POP
x $MCH
1,000
d. Total Initial Costs to State
$STIN
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in
m
3
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00
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Ul
I
.'C. Recurring Costs
1. Central Administrative Personnel
Position Area
Program Administrators
Technical Officers
•)atn Analysis/Statistical Staff
Clerical and Secretarial Staff
SUBTOTAL
Number
Overhead, Fringe and Contingency (^ %)
Cost
TOTAL • $CAPAN =
D.
Annualized Costs to State
1. Amortization of Initial Costs to State
PRL
$STIN
INT (1 + INT)
(1 -I- INT)PRL - 1
2. Recurring Costs to State Accounting for Inflation
$STRC
PRL
3. Total Annualized Program Costs to State
SSTPT + $SANN
$STPT
'$SANN.
SSTATE
Centralized-9
2. Total Recurring Costs to State
a. Inspection Facility Monitors
i) Annual Salary = $FMS
ii) Overhead, Fringe and Contingency ( %)
. ill) Travel $ ., per Monitor
or $ x FAC
b. Central Administrative Personnel
= $CAPAN
c. Annual Additional Mechanic Training
$MCH x AAP"|^P x Mech/1,000
d. Total Recurring Costs to State
= $STRC
VII. TOTAL OVERALL PROGRAM-COSTS FOR CONTRACTOR OPERATED PROGRAM
A. Total Annualized Program Costs
$STATE 4- $CONTR
$TOTL
B: Annual Fee to Motorists
= Average Annual
Program Cost
per Vehicle
$TOTL
AAP
Inspection
Fee
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