Development of Cost Estimates

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					Development of Cost Estimates
A cost estimate was prepared for each proposed strategy that passed the initial screening process. In most cases the designs used in the strategies are conceptual and require detailed engineering studies prior to implementation of the strategy. The development of cost estimates is governed by Appendix B Section 1.7 of the Region F contract with the Texas Water Development Board. The cost estimates include construction costs, other project development costs, and annual costs. Other project costs include engineering and contingencies, environmental and archeological studies, and interest during construction. Annual costs include debt service, operation and maintenance, electricity, and purchase of water. Capital costs are set at mid-1999 price levels with no adjustment for future inflation. Standardized costs were used in order to make an equitable comparison of the cost of various alternatives. Actual construction and capital costs may be higher or lower depending upon site conditions, financing options, permitting, water purchase price, costs of electricity, time of construction and other factors. The cost estimates use standard costs for installed pipe, ground storage tanks, pump stations and standard treatment facilities developed from experience with similar projects throughout the State of Texas. All unit costs include the contractors’ mobilization, overhead and profit. Installed pipe costs also include appurtenances and an allowance for resolving conflicts. In some cases standard pipe costs were adjusted for installation conditions or major conflicts such as river crossings. Other assumptions include costs for purchase of treated or raw water, treated effluent, and environmental and archeological studies. These costs may vary substantially from actual costs. Costs for reservoirs and water wells were developed using site-specific criteria.