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 ------- 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. ------- -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 ------- -3- 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. ------- 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 ------- -5- (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 ------- -6- (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 ------- -7- (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 ------- -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 ------- -9- (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. ------- 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 ------- -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. ------- -12- (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 ------- 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 - ------- -14- (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* (*•?/* SSoft f 91*O D. Annualized Costs to State .1. AmortiEation of Initial Costs to State $STIN x INT (1 + INT) PRL7 PRL~I* (1 + llJT)PRL - 1 J 2. Recurring Costs to State Accounting for Inflation PRL-1 $STRC PRL 3. Total Annualized Program Costs to State $STPT + $SANN - $STPT $SANN $STATE 2. Total Recurring Costs to State a. Inspection Facility Monitors i) Annual Salary = $FMS ii) Overhead, Fringe and Contingency (_y^* %) ill) Travel $ V 6O per Monitor(^) or $ k A4_ x FAC b. Central Administrative Personnel = $CAPAN c. Annual Additional Mechanic Training $MCHXT7^F x Mech/1> °° 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 ------- 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 ------- 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) ------- 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 ------- 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 ------- c in m 3 O o H vo 00 o» 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 ------- |