Maintenance cost

“ If the company calls something a betterment, and it is found that the betterment has only replaced something, it is not allowed, but is classed as maintenance; on the other hand, if the replacement is larger, and capable of rendering greater results, such as a larger engine, pipe, cable, etc., the cost, less the cost of what it replaces, is allowed as a betterment, and if the old part is sold the proceeds are deducted from the betterment charge, for if it is credited to maintenance, it increases the true net earnings. ”

“ The maintenance cost is very light if the road is properly constructed in the first place, consisting chiefly in removing a pole here and there that shows signs of too much wear, and in bracing guard rails where they weaken. ”

“ For instance, the farms to be abandoned will eliminate the necessity of maintaining thousands of miles of dirt roads leading to these farms, the maintenance cost of which averages one hundred dollars a mile a year. The reafforestation of these farms eliminated the need of providing thousands of miles of electric light and telephone lines reaching out into uneconomical territory. ”

“ The saving in cost of construction and maintenance would much more than pay for the cost of all land which it would be necessary to condemn for their right-of-way, and the saving in time and cost of transportation for the whole community would amount to a large sum every year. ”

“ It is desirable, of course, to get as much capacity in works as one can for the outlay, but there are instances where one can get too much for the money, as where a larger pipe than is necessary is used for a sewer, merely because it costs about the same as a smaller one, and as a result the cost of maintenance is permanently increased. ”

“ It is part of the cost of the human machine.
“Repair is the course of partial reconstruction, replacement, or [Pg 90] renewal of worn or of injured portions, after the necessity therefor becomes apparent, and, unless brought about by accident, the need for the process is brought about by the failure or inability of maintenance, and also of up-keep, wholly to arrest the progress of decay by age or continued use. Provisions to preclude accident or to cover the cost of its results are part of the cost of repair. Health insurance of employees is a repair cost paid in advance.” ”

“ Merely as examples we will mention a few such opportunities which have thrust themselves upon us as important. The making of such improvements is so bound up with improved maintenance [Pg 12] that while the cost of them might properly be met either out of increased maintenance funds or out of special improvement funds, the work should be done mainly by the maintenance personnel. ”

“ Probably correct present value estimates which include depreciation may not be even fairly approximated without intimate knowledge of the particular property, and this should embody operation, policy of management, past performance, study of historical cost (as far as the records will permit) , estimated cost of construction, and actual cost of maintenance. The life of a piece of track or equipment, disregarding obsolescence and extraordinaries, generally depends on the type and details of construction, the service it has done, and the service that will be required of it. ”

“ Plan the bathroom of your house early. Talk with your architect. Insist upon the best and get it. Your bathroom need consist of very few things, in the last analysis, and the wisest plan is to get the best. The cost will be from $250 upwards, for fixtures. However, it is wisest to buy the best you can afford so that a replacement cost is obviated. There must be no skimping of plumbing work, because that would be a menace to both health and wealth, and the plumbing costs no more for good material than for bad. ”

“ FUNDING— If the Secretary determines that a project facility inspected and maintained pursuant to the guidelines and criteria set forth in section 9602 (a) requires extraordinary operation and maintenance pursuant to paragraph (1) , the Secretary may provide Federal funds on a nonreimbursable basis sufficient to cover 35 percent of the cost of the extraordinary operation and maintenance allocable to the transferred works operating entity, which is needed to minimize the risk of imminent harm. ”

“ The manner in which heavy capital outlay for maintenance accompanies as well as partly accounts for a decline in the cost of conducting transportation on American roads, is graphically shown by the diagram on the next page. [41] During ten years a steady decline in direct operating costs has accompanied an equally marked upward tendency in expense of maintenance. The bearing of this on the problem of rate advances in future is direct. Profitableness results from two separate sources ”

“ The cost of repairs and maintenance is so obviously out of all proportion with the necessities of a system of completed structures like our canals, which have little that is complicated or perishable about them, that we are forced to seek the explanation of it in their administration. ”

“ The expense of installing an underground system is very great in comparison with that of overhead construction, but the cost of maintenance is much less and the liability of interruption of service greatly reduced. ”

“ Benefits and costs should be measured and appropriately discounted over the full life cycle of each project. Such analysis will enable informed tradeoffs among capital outlays, operating and maintenance costs, and nonmonetary costs borne by the public. ”

“ Little weight is given to cleaning cost when paving questions are settled and an actual expense of $500 a mile in repairing residence streets would be considered an appreciable item of maintenance, yet that figure for cleaning a mile of residence streets through a season is extremely low. ”

“ Where a person, detained by judicial decision, has no settlement, the costs of maintenance fall on the province in which he was arrested or brought before the Court; in the case of souteneurs the cost is borne by the Communes in which they pursued their practices. Costs of maintenance can, however, be recovered from the persons concerned, or those legally liable for their support. ”

“ Thus difference might fairly arise as to when reserve accounts ought to be closed out, as to how much of the sum actually expended for maintenance within a given time was properly allocable to that period, and how much to later years; at what price renewals and replacements should be charged in view of the rapidly mounting cost of material; what factor of difference should be allowed for the efficiency of labor in the pre-war and postwar periods. ”

“ ARTICLE 99 Charges may be imposed on natural waterways only for such works, facilities, and other accommodations as are designed for the relief of traffic. In the case of state and municipal public works they may not exceed the necessary costs of construction and maintenance. The construction and maintenance costs of works designed not exclusively for the relief of traffic, but also for serving other purposes, may be defrayed only to a proportionate extent by navigation tolls. Interest and amortization charges on the invested capital are included in the costs of construction. ”

“ It has everything to commend it, save a slightly increased original cost, which is more than compensated by economy of maintenance, to say nothing of the intangible but certain raised factor of safety. ”

“ Homeowners generally try to minimize maintenance costs, and some landlords make needed repairs only when required to do so. Immediate prospects for costly repairs to correct possible defects are going to keep many a door closed to the inspector. ”

“ Appendix A gives some comparative figures of maintenance labor and maintenance costs, which we have used in arriving at our tentative conclusions of this subject.
We see no signs whatever of such a flocking of capable men into the ranks of gardeners and gardening laborers in America as would tend to lower the costs of such work as compared with the costs of all the other things that money buys. If anything, the tendency seems likely to be the other way, as it has been for some time in the past. ”

“ In other cases, neglect of repairs increases the expenses of repairs and cuts off future rental. The adages, "A stitch in time saves nine," and "An ounce of prevention is worth a pound of cure," must be acted upon in every industry. The neglect to repair a roof causes damage to an amount many times the cost of a new roof. Failure to replace a bolt costing five cents may result in the rack and ruin of a machine worth many dollars. A handful of earth on a dike may save a whole country from destruction. ”

“ Through perfection in design and reasonable care in operation, the cost of filter cleaning, which is a very considerable part of the total cost, has been reduced to an unusually low figure, without any sacrifice in efficiency, and in the interests of the public health. ”

“ Many engineers maintain that repairs are light during the early life of an asset and heavy during the later years. If this is true and these costs are charged to the period in which they are incurred, the combined depreciation and up-keep costs place an unjustly heavy burden on the output of the later years. Almost equally good authority maintains that the cost of repairs is in no sense uniformly graduated as implied above but can be counted upon in practice to be extremely irregular. ”

“ Without doubt the most important single factor in the determination of the depreciation rate is the normal policy as to repairs and maintenance. Physical deterioration is constantly at work. If this is counteracted by a liberal maintenance policy, not only is more efficient service secured but a longer service life is thereby insured. As soon as repairs are needed, although the efficiency of the asset may not be immediately impaired, the rate of deterioration is much accelerated unless the condition is corrected. ”

“ Physical depreciation, for example, if an accumulation is necessary to provide for replacement, ought to be provided beforehand from the rates of users of the service which caused the machine to wear out. But where replacement is made on account of obsolescence or inadequacy and economy is effected in costs, that economy can with fairness be devoted to reimbursement for the replacement cost, the rates remaining unchanged. ”

“ The production and distribution of equipment and machinery is likewise a major item in the provision of employment. The ownership expense, exclusively for highway construction equipment, is calculated to exceed $140,000,000 annually. Repair and replacement requirements are about the equal of depreciation in the long run, and the unprecedented use of construction equipment during the war emergency is indicative of the need for extensive replacement and maintenance when the green light comes on again. ”

“ It serves to distribute equitably throughout the several years of service life the only expense of plant retirement which is capable of reasonable ascertainment-the known cost less the estimated salvage value. And it enables those interested, through applying that plan of distribution, to ascertain, as nearly as is possible, the actual financial results of the year's operation. Many methods of calculating the amount of the allowance are used. [17] The charges to operating expenses in the several years and in the aggregate vary according to the method adopted. ”

“ The purchase of office, engineering and construction supplies and equipment is handled by this department and a considerable saving is realized by buying in quantities. On all stock supplies, each job is charged with the amount furnished and similarly rental on our own engineering instruments and automobiles is charged, so that the cost of each job may be determined. On construction projects which are furnished with our own trucks, road rollers, etc., each piece of equipment is rented out to the job in the same manner. ”

“ Particularly in those businesses in which interest and depreciation charges in plant constitute a large element in the cost of production, experience has taught that the financial burdens incident to unnecessary duplication of facilities are likely to bring high rates and poor service. ”

“ Had it been possible to make such precise determinations, moreover, the usefulness and validity of an estimate of the ultimate cost of a construction program that must inevitably extend over a period of perhaps 20 years and be affected by unpredictable changes in the general economy, in the habits and desires of the people, in the character of vehicles, and in other circumstances, would still be highly questionable. ”

“ It should be kept in mind that the determining factor here is efficiency. The serviceability of the machine must be kept up to a recognized standard through adequate expenditures for repairs and up-keep until the cost of up-keep is disproportionate to the service rendered, or until the machine becomes so decrepid as to make its operation hazardous. ”

“ But no one would question that the reasonable cost of an efficient public utility system 'is good evidence of its value at the time of construction.' We have said that 'such actual cost will continue fairly well to measure the amount to be attributed to the physical elements of the property so long as there is no change in the level of applicable prices.' McCardle v. ”

“ The reason is not obscure: the cost and detriment to a property owner attributable to the use of his property by the public, and the value of the service rendered by the property to the public, are measured day by day, month by month, year by year, and are little influenced by the question how long the service is to continue. The cost of the service includes the use of the plant, but, ordinarily, not its destruction, except through the slow processes of wear and tear and obsolescence, for which graduated depreciation allowances are made. ”