Archive for tag: DoD Facilities Pricing Guide

New models provide alternative life cycle cost estimates for marine piers

Piers make up a large part of the maritime infrastructure, yet their life cycle costs are little discussed in the available literature. A study for the U.S. Coast Guard focused on the M&R (sustainment) costs of two types of piers-concrete and timber. We found a substantial difference (30 percent) in costs between the two types and, in comparison, an apparent understatement (at least 50 percent) of M&R costs by one well known reference.

Our models consist of component level descriptions of typical fixed piers matched with scheduled repair tasks and service calls.[1] The tasks are calibrated for a specific area in terms of labor rates, material costs, and climate, and then used in specialized software to generate a 50-year cost profile.[2]

 

Replacement Value

M&R Costs (Sustainment)

Concrete Pier

$417

$10.66

Timber Pier

$220

$7.26

Costs are per gross square foot, expressed in $2010 and normalized to Washington D.C.; M&R costs are averaged for a model pier over 50 years following construction.

Source: Whitestone Research

The estimates differ by $3.40 per square foot depending on pier type, with the difference driven largely by the periodic replacement of fenders, pilings, and decking. Note that the concrete pier accommodates heavier traffic so is not directly comparable in terms of the service provided.

In another comparison, we found our estimates differ greatly with those published by the U.S. Department of Defense. According to the DoD Facilities Pricing Guide, the sustainment costs for a pier should be $3.51 per square foot, less than half of our estimates. The Pricing Guide makes no distinction by pier type.

The reasons for the difference are unknown. It is not because of inconsistent definitions; the Pricing Guide and our model use the same definition of sustainment costs. Instead, we suspect differences in data quality and the estimation method.

Does it matter? Yes. Knowledge of life cycle costs are instrumental in the prioritization of projects, the evaluation of alternative technologies (such as floating piers), and the forecasting of budget requirements.

With respect to sustainment budgets, the difference in estimates can have a profound impact. Together, the U.S. Navy and Coast Guard are responsible for maintaining roughly 19 million square feet of piers. Based on the Pricing Guide, the annual requirement for this inventory is $67 million, while alternative estimates based on this study would range from $138 to $202 million.[3]

Click here to view Whitestone Square Foot Cost Profiles for Piers.

 

- Michael Towers


 

[1] The component inventories and selected task frequencies were defined by the marine engineering firm Moffatt and Nichols.  Much of the task and cost data were taken from the Whitestone Facility Maintenance and Repair Cost Reference 2010-2011 (Santa Barbara: August 2010).

[2] M&R cost profiles were generated by the MARS facility Cost Forecast System (version 8.5). Other operating costs are also available. A 50-year service life is a common assumption in engineering and economic studies regarding pier construction or renovation. The average age of existing U.S. Navy and Coast Guard piers is approaching 50 years; in the case of the Coast Guard, roughly 20 percent are over 50 years old.

[3] For simplicity, we assume that all piers are located in the Washington D.C. area.  In the Coast Guard study, we calibrated the estimates for actual pier location and age.