cost?benefit?analysis | School Graders

Description
?CBA?for?the?analysis?of?whether?to?increase?Florida’s?state?funded?Early?Steps?program?staff?based?on?the?recent
increase?of?children?being?diagnosed?with?autism?spectrum?disorder.

COST-BENEFIT
ANALYSIS
Template
Project or Initiative Name
Month, Year

Adapted from “Cost/Benefit Analysis,” by the U.S.
Department of Housing and Urban Development. Retrieved from http://www.hud.gov/offices/cio/sdm/devlife/tempchecks/cbatemplate.doc

COST-BENEFIT ANALYSIS

TABLE OF CONTENTS

Page #

1.0 GENERAL INFORMATION 1-1
1.1 Purpose 1-1
1.2 Scope 1-1
1.3 Background and Overview 1-1
1.4 Project References 1-1
1.5 Points of Contact 1-1
2.0 ANALYSIS SUMMARY 2-1
2.1 Assumptions and Constraints 2-1
2.2 Methodology 2-1
2.3 Recommendations 2-1
3.0 DESCRIPTION OF ALTERNATIVES 3-1
3.1 Current Policy or Practice 3-1
3.2 Proposed Project, Policy, or Initiative 3-1
3.x [Alternative Project, Policy, or Initiative] 3-1
4.0 COSTS 4-1
4.1 Development Costs 4-1
4.2 Operational Costs 4-1
4.3 Nonrecurring Costs 4-1
4.3.1 Capital Investment Costs 4-1
4.3.2 Other Nonrecurring Costs 4-1
4.4 Recurring Costs 4-2
5.0 BENEFITS 5-1
5.1 Nonrecurring Benefits 5-1
5.1.1 Cost Reduction 5-1
5.1.2 Value Enhancement 5-1
5.1.3 Other 5-1
5.2 Recurring Benefits 5-1
5.3 Nonquantifiable Benefits or Nontangible Benefits 5-2

6.0 COMPARATIVE COST AND BENEFIT SUMMARY 6-1
6.1 Cost of Each Alternative 6-1
6.1.1 Nonrecurring Costs 6-1
6.1.2 Recurring Costs 6-1
6.1.3 Total Cost 6-1
6.2 Benefits 6-1
6.3 Net Present Value 6-1
6.4 Payback Period 6-1
6.5 Conclusions and Recommendations 6-1

NOTE: Informational placeholder text throughout this template is provided solely as background information to assist you in creating this document. Please delete placeholder text, as well as the instructions in each section, prior to submitting this document. Only your project-specific information should appear in the final version of this document.

1.0 GENERAL INFORMATION

1.1 Purpose

Describe the purpose of the cost-benefit analysis. Why does the policy, project, or initiative need to be analyzed using the cost-benefit analysis tool?
1.2 Scope

Describe the scope of the cost-benefit analysis as it relates to the project. What is the geographic scope? What is the timeframe for the analysis? Why?

1.3 Background and Overview

In no more than one page, please provide a brief overview on your issue, including any relevant background information on the topic. This might include a brief history of the issue and a rationale for implementing the project, policy, or initiative.
1.4 Project References

Provide a list of the references that were used in preparation of this document. Examples of references are:
? Previously developed documents relating to the project, policy, or initiative.
? Documentation concerning related projects, policies, or initiatives.
1.5 Points of Contact

Provide a list of the stakeholders who may be needed by the document user for informational and troubleshooting purposes. Include the type of contact, contact name, department, telephone number, and e-mail address (if applicable). Include anyone who had input in gathering the data in this research.

2.0 ANALYSIS SUMMARY

2.1 Assumptions and Constraints

State the assumptions and constraints under which the cost-benefit analysis was conducted.
2.2 Methodology

Summarize the procedures for conducting the cost-benefit analysis and the techniques used in estimating and computing costs. These techniques should be supported by the literature and may be detailed in an appendix.
2.3 Recommendations

Summarize the recommendations from the cost-benefit analysis.

3.0 DESCRIPTION OF ALTERNATIVES

This section identifies the alternative approaches for addressing the problem that the project, policy, or initiative was created to solve and provides a brief description of each. In addition, it provides a description of the current status quo (before implementation of the project, policy, or initiative).
3.1 Current Policy or Practice

Describe the current policy (status quo, if applicable).
3.2 Proposed Project, Policy, or Initiative

Describe the characteristics of the proposed project, policy, or initiative.
3.x [Alternative Project, Policy, or Initiative]

Each alternative system in this section should be under a separate section header. Generate new sections as necessary for each alternative system from 3.3 through 3.x. Describe the characteristics of each alternative system.

4.0 COSTS

This section will calculate all costs to implement the project, policy, or initiative, as well as the alternative options (as applicable) described in section 3.0, including both one-time and recurring costs. This may be done in the form of a matrix or by listing the specific category of costs under the appropriate subsections as applicable. Multiply costs to be incurred in the future by a present value factor: an inflation index that defines future costs in present dollars. This index takes into account items such as increases in material costs, potential salary increases, and so forth. This calculation brings the cost into present dollars.
4.1 Development Costs

Estimate the development cost for the project, policy, or initiative. When determining the overall cost of development, include costs for personnel, equipment, training, materials, and so forth. These are typically the project, policy, or initiative start-up costs (year 1).
4.2 Operational Costs

Estimate the installation, operation, and maintenance costs for the project, policy, or initiative. Include costs such as personnel, equipment, replacement, and staff training. These are typically the ongoing costs after start-up expenses (year 2 and beyond). If your project, policy, or initiative is a one-time change, you may not have additional operational costs.
4.3 Nonrecurring Costs

Present nonrecurring costs of the project, policy, or initiative.
4.3.1 Capital Investment Costs

Include costs for acquiring, developing, and installing:
? The site and facility.
? Any equipment purchases.
4.3.2 Other Nonrecurring Costs

Include costs for:
? Studies (requirement and design studies).
? Software conversion.
? Reviews and other technical and management overhead.
? Training, travel, and other personnel-related costs (except salaries and fringe benefits).
? Involuntary retirement, severance, and relocation costs for personnel.
? Contractual, interagency, or other direct-support services.
? Incremental or additional overhead costs.
? Potential disruption to existing business operations.
4.4 Recurring Costs

Present the monthly or quarterly recurring costs (or both) of operating and maintaining the project, policy, or initiative over system life, including:

5.0 BENEFITS

This section describes benefits that can be assigned dollar values for the project, policy, or initiative described in section 3.0. This may be done in the form of a matrix or by listing out the specific category of benefits for the project, policy, or initiative under the appropriate section headings as applicable.
5.1 Nonrecurring Benefits
In the following subsections, describe nonrecurring benefits for the project, policy, or initiative.
5.1.1 Cost Reduction

Describe nonrecurring cost reductions resulting from improved operations as a result of the project, policy, or initiative, including reduction of staff, improved response times, improved efficiency, reduced error rates, and so forth.
5.1.2 Value Enhancement

Describe benefits that enhance the value as a result of the project, policy, or initiative, for example, improved administrative and operational effectiveness, reduced error rates, and so forth.
5.1.3 Other

Describe other benefits.
5.2 Recurring Benefits

Present the monthly or quarterly (or both) recurring-benefit costs of operating and maintaining the project, policy, or initiative over system life, including:

? Equipment lease, rental, and in-house maintenance.
? Software lease, rental, and in-house maintenance.
? Personnel salaries and fringe benefits.
? Direct support services (intra-agency services).
? Travel and training.
? Facility and space occupancy.
? Materials, supplies, and utilities.
? Contractual and interagency services.
? Overhead. Include overhead benefits that represent additional or incremental expenses attributable to the project, policy, or initiative.
? Cost avoidance. (Describe avoidance of future costs that would be incurred if the project, policy, or initiative were implemented, compared to maintaining current operations. Describe improvements in operational flexibility, information handling, and response to anticipated requirements, as related to cost avoidance.).
5.3 Nonquantifiable Benefits and Nontangible Benefits

Describe benefits that cannot be quantified in terms of direct dollar values (for example, improved service, improved information handling, enhanced organizational image) for the project, policy, or initiative. Intangible benefits can sometimes be assigned values in terms of estimates and tradeoffs.

6.0 COMPARATIVE COST-BENEFIT SUMMARY

This is a summarization of the cost and benefits identified in detail in the previous chapters. Present the elements below in a manner to facilitate comparison. Tables and charts are helpful here.
6.1 Cost of Each Alternative

For each alternative described in section 3.0, present costs in the period (year, quarter, month) in which they will be incurred.
6.1.1 Nonrecurring Costs

Total the nonrecurring costs previously itemized.
6.1.2 Recurring Costs

Include recurring costs such as rental, maintenance, utilities, telecommunications, and personnel. Total the recurring costs.
6.1.3 Total Cost

Total the nonrecurring and recurring costs subtotals for the project, policy, or initiative over the life of the project, policy, or initiative. Include the present value cost over the life of the project, policy, or initiative using appropriate discount methods based on your research.
6.2 Benefits

Identify the period of benefits. Enter the quantifiable dollar benefits for the period in which they are accrued and make present value calculations.
6.3 Net Present Value

Calculate the net present value by subtracting the adjusted cost from the total present value of benefits.
6.4 Payback Period

Calculate the year or month in which the sum of benefits first exceeds the sum of the costs expressed in current dollars.
6.5 Conclusions and Recommendations

Share your conclusions in terms of net cost or net gain and make recommendations based on this finding. You should also address the areas of ethics, providing equitable services for diverse populations and the impact of using this tool for decision-making.