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Postsecondary Education

NCES 2006-160
May 2006

6.2.1 Process Concepts

Components. Buildings, facilities, and sites comprise various components and subcomponents. A building consists of structure/foundation, exterior, interior, and systems components. Typically, exterior subcomponents include the roof system, gutter system, walls, windows, and doors. Interior subcomponents include walls, floors, and ceilings.

System subcomponents may include electric; plumbing; heating, ventilation, and air conditioning (HVAC); and telecommunications/data. These subcomponents are broken down further to coincide with different life cycles of the various major elements of the system.

Life Cycles and replacement costs. Each of the various building, site, and facilities subcomponents has an estimated life cycle, which can vary depending on preventive and planned maintenance programs. the replacement cost of the various subcomponents can be determined.

Conditions, Deterioration, and Condition-Related Costs. The condition of the various subcomponents can be evaluated and determined. A relationship between the condition and the replacement cost can be formulated to understand the deterioration of the subcomponent. The current value of the subcomponent is the replacement cost minus deterioration. As a result of a deteriorated condition in a subcomponent or an improvement in the efficiency of the subcomponent replacement, there may be a condition-related cost that will be either the:

  • incremental annual operating cost attributable to the deteriorated condition or the annual operating cost savings attributable to the improved efficiency of the state-of-the-art replacement, or
  • annual loss of program income attributable to the deteriorated condition.

Analysis. With the replacement costs, deterioration, current value, and annual incremental costs attributable to conditions and obsolescence known, a capital program consisting of corrective projects and upgrades can be developed, modeled, presented, and scheduled. Post-project subcomponent conditions can be estimated. Improvements in current values and condition-related costs can be determined and modeled, and projects can be ranked by projecting improvements in operating costs and program income over newly created life cycles.