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Pages 82-99

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From page 82...
... Section 5.1 General Guidance explains why treatments should be considered and their impact on asset value calculations and calculation components including expected asset life and residual value. Section 5.2 Recommended Steps lists the suggested procedures for identifying treatand determining residual value.
From page 83...
... An important part of performing the asset value calculation is accounting for 1. It is important to consider what treatments are typically performed on an an asset reaches the end of its useful life.
From page 84...
... / Section 5.1 General Guidance If the asset value ment, then the treatment needs to be accounted for in some manner to show how the value changes if the treatment is performed. For instance, one might calculate future asset value with and without performing the treatment.
From page 85...
... / Section 5.1 General Guidance For each treatment that is modeled one must establish how much the treatdescribed in Chapter 4 for calculating replacement costs are equally applicable to calculating the cost of other treatments. Generally speaking, the calculation of than constant dollars, one must be careful to state the year of the expenditure However, in the case that one is basing asset value on historic costs all costs should be expressed in year of expenditure dollars.
From page 86...
... / Section 5.1 General Guidance cur, including planned maintenance, cyclical treatments that are needed to life of the assets if they are omitted; and not assumed to occur, as their contributions to asset value and life will be accounted for separately. concerned with how long an asset would remain in service in the abstract case that no treatments are ever performed on an asset.
From page 87...
... / Section 5.1 General Guidance Measuring Capital (19) guidance for vehicles (33)
From page 88...
... / Section 5.1 General Guidance Residual Value determination of the residual value of the asset, or the value of the asset once it has reached the end of its useful life. Note this topic is addressed separately for the case where one calculates economic value, as discussed in Chapter 4.
From page 89...
... Identify Treatments Section 5.2 Recommended Steps 5-8 A Guide to Computation and Use of System-Level Valuation of Transportation Assets Review Treatment Data lifecycle strategy and/or other available agency data to determine what treat treatment data are consistently tracked. Identify Mandatory Treatments Identify treatments that will be considered independently in the valuation These include treatments that reset the asset age or restore an asset to "like new" condition.
From page 90...
... / Section 5.2 Recommended Steps 5-9 A Guide to Computation and Use of System-Level Valuation of Transportation Assets Collect Data on Past Treatments Collect data on cost and treatment timing for each treatment being consid ments that are assumed to occur and incorporated in the estimate of asset useful life. toll road)
From page 91...
... / Section 5.2 Recommended Steps Establish Asset Useful Life 5-10 A Guide to Computation and Use of System-Level Valuation of Transportation Assets Collect and review records on when assets have been replaced. Ideally data on past replacements should be accompanied by information on what moti vated the replacement.
From page 92...
... / Section 5.2 Recommended Steps Determine Residual Value 5-11 A Guide to Computation and Use of System-Level Valuation of Transportation Assets in cost from the initial purchase or construction of an asset. This determina tion depends on the nature of the treatments performed on the assets and the determination of which treatments are being modeled.
From page 93...
... described in Section 5.2. A highway agency needs to calculate asset value for pavements and bridges Section 5.3 Examples 5-12 A Guide to Computation and Use of System-Level Valuation of Transportation Assets Table 5-2.
From page 94...
... / Section 5.3 Examples construction/reconstruction is considered in the calculation, and a more comand preservation treatments on asset value. represented by other agencies.
From page 95...
... / Section 5.3 Examples included in the asset valuation calculation. Adding treatments supports a more detailed and potentially more accurate calculation of how asset value varies over time, but entails quantifying more data.
From page 96...
... / Section 5.3 Examples the more comprehensive approach it would be necessary to represent bridges at a component level, modeling the deck, superstructure and substructure of a bridge separately, given that several of the treatments have an impact on only one component.
From page 97...
... / Section 5.3 Examples Based on review of agency data and other sources the agency establishes a repair and rehabilitation treatments are assumed to occur in a timely fashion A transit agency seeks to calculate residual value for its vehicles, facilities, track and equipment. Based on the guidance in Section 5-2, the agency calculates residual value for selected assets as shown in .
From page 98...
... emerging practice is one that supports the guidance with minimal complexity, has addressed some aspect of the asset value calculation in a comprehensive manner, and strengthening practice lies between these two levels. Section 5.4 Practice Assessment 5-17 A Guide to Computation and Use of System-Level Valuation of Transportation Assets Maturity Level Description Identifying Asset Treatments Emerging Asset purchase or construction and reconstruction are included in the asset value calculations.
From page 99...
... / Section 5.4 Practice Assessment 5-18 A Guide to Computation and Use of System-Level Valuation of Transportation Assets Maturity Level Description Determining Residual Value Emerging The analysis is limited to asset purchase or construction and reconstruction. Asset reconstruction is assumed to have the same cost and Strengthening A determination is made for each asset class and component concerning whether to calculate residual value based on salvage value or the values are established based on expert judgement.

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