Author Topic: Government Day-to-Day  (Read 13996 times)

0 Members and 0 Guests are viewing this topic.

Offline ?Impact

  • Hero Member
  • *****
  • Posts: 2941
Re: Government Day-to-Day
« Reply #195 on: February 10, 2020, 02:23:24 pm »
1. Infrastructure is used over time, though.

Infrastructure comes with 4 major cost components

1. Initial construction/installation cost
2. interest on monies borrowed to cover initial construction/installation
3. Annual recurring maintenance costs
4. Interest on monies borrowed to cover annual recurring maintenance costs

Hopefully we can all agree that #4 should be zero, or at maximum paid off within 12 months

I expect #2 & #3 are the largest cost items. While #3 may start off being a percentage of #1, over time I expect it will become larger than #1. Not all initial construction/installation costs will occur up front. If a major upgrade is made, say adding a lane to an existing highway, then that is really a new installation. If however a bridge span needs to be replaced because the initial span failed before expected lifetime then that is a maintenance cost. #3 should always be paid off withing 12 months.

That really leaves us with what lifetime should be used for infrastructure.
Like Like x 1 View List