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Cost Benefit Analysis Page 4

4.0

COSTS

This section will calculate all costs to develop and operate each alternative described in sections 3.3

through 3.x, including both one-time and recurring costs. This may be done in the form of a matrix or by

listing out the specific category of costs for each alternative system under the appropriate section

headings.

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 vendor and potential salary

increases. This calculation brings the cost into present dollars.

4.1

Development Costs

For each alternative system described in the Feasibility Study, estimate the cost of the Define, Design, and

Build system phases. When determining the overall cost of development, include costs for personnel,

equipment, developer training, and development tools.

4.2

Operational Costs

For each alternative system described in the Feasibility Study, estimate the installation, operation, and

maintenance costs of the system. Include such costs as personnel, equipment, operational site upgrades or

changes, and staff training.

4.3

Non-Recurring Costs

Present non-recurring costs of each alternative over the system life.

4.3.1 Capital Investment Costs

Include costs for acquiring, developing and installing:



Site and Facility



Automated data processing (ADP) equipment



Data communication equipment



Environmental conditioning equipment



Security and privacy equipment



ADP operations, multipurpose and applications software



Database

Cost/Benefit Analysis

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Cost Benefit Analysis Page 4