VDOT's Policies and Procedures

Methodology/Computations 

Approach to Valuing Infrastructure
VDOT Infrastructure Values June 30, 2000

Road Inventory
Factors
Interstate, Primary, Secondary, and Urban
Bridges, Culverts, and Tunnels
Right of Way
Depreciation
Work in Progress


Road Inventory - Factors

In developing a methodology to compute VDOT’s infrastructure value, many components, statistics and values were analyzed to develop average factors. VDOT suggests governments of the Commonwealth of Virginia take advantage of these average factors computed by VDOT when calculating infrastructure values. Please note, these factors were computed in the year 2000. In order to inflate these costs to current year values, we recommend you apply the appropriate rate from the Bureau of Labor Statistics Consumer Price Index which can be obtained at the website addresshttp://www.bls.gov/cpi/ .

Road Inventory - System

System

Average Cost to Construct One Lane Mile

Interstate

 $                  1,874,055

Primary

 $                     768,627

Secondary

 $                     237,208

Urban

 $                     779,775

Road Inventory - Bridges, Culverts, and Tunnels

Type

Average Cost to Construct One Square Foot

Bridges

 $                             75

Culverts

 $                           100

Tunnels

 $                             20

Road Inventory - Right of Way

System

Average Cost per Acre

Right of Way Weighted Average Width in Feet per Mile of Road

Interstate

 $                      13,608

265

Primary

 $                      13,608

90

Secondary

 $                      13,608

50

Urban

$                      13,608

90

 

Road Inventory - Interstate, Primary, Secondary, and Urban*

A. Determine lane miles by system, by year
B. Determine lane miles by system, by year related to bridges and tunnels
C. Determine current costs (FY00) to construct a lane mile of road by system
D. Determine a deflation factor by year, utilizing the Consumer Price Index

((A-B)*C)*D = VALUE 

*Please note, while VDOT does not consider Urban road inventory to be one of it's infrastructure assets, this same methodology used to calculate the value of Interstate, Primary and Secondary road inventory could be applied to the Urban system.

Road Inventory - Bridges, Culverts, and Tunnels

Bridges

A. Identify bridges, by year
B. Calculate the area (by square feet) or each bridge (length times width)
C. Determine the current cost (FY00) to construct one square foot of a bridge
D. Determine a deflation factor by year, utilizing the Consumer Price Index

(B*C)*D = VALUE

Culverts  

A. Identify culverts, by year
B. Calculate the area (by square feet) of each culvert (length * width)
C. Determine the current cost (FY00) to construct one square foot of culvert
D. Determine a deflation factor by year, utilizing the Consumer Price Index 

(B*C)*D = VALUE

Tunnels  

A. Identify Tunnels
B. Identify historical costs to build tunnels

Road Inventory - Right of Way

A. Determine miles, by system, by year
B. Determine average current cost (FY00) to purchase one acre of land
C. Determine acres per mile of road, by system as follows
  • Determine average right of way width and road width by system
  • Multiply the total average right of way width * the length of a mile (5,280 ft)
  • Divide the total square feet per mile by the number of square feet in an acre (43,560)
D. Determine a deflation factor by year, utilizing the Consumer Price Index

((A*B)*C)*D = VALUE

Road Inventory - Depreciation

VDOT has selected to depreciate it’s assets utilizing the straight line depreciation method. We have estimated the useful life of a road to be 30 years and 50 years for structures and bridges*. Assets are depreciated as though they are held the entire year.

Shown below is an example of how VDOT’s June 30, 2000 road inventory assets were depreciated using this methodology:
(Columns A thru E)

Year

 Road Value

 One Year's Depreciation (Column B * Factor X)

Years of Accumulated Depreciation

 Accumulated Depreciation (Column C * Column D)

1970

 $181,538,570

 $    6,051,286

30

 $181,538,570

1971

   119,686,188

       3,989,540

30

   119,686,188

1972

   109,210,085

       3,640,336

29

   105,569,749

1973

     43,637,279

       1,454,576

28

     40,728,127

1996

     67,530,148

       2,251,005

5

     11,255,025

1997

   145,352,852

       4,845,095

4

     19,380,380

1998

   141,892,196

       4,729,740

3

     14,189,220

1999

   167,833,089

       5,594,436

2

     11,188,873

2000

   352,988,389

     11,766,280

1

     11,766,280


Depreciation life for roads 30 Years
Depreciation rate for roads 0.0333 (Factor X)

The same methodology could be applied to structures and bridges using a depreciation life of 50 years and a rate of 0.020.

*VDOT had decided to use a life-cycle design basis for their facilities.  Pavements and bridges are a substantial part of the cost of VDOT's total assets.  In this regard, VDOT's road pavements and bridges are designed for a 30-year and 50-year life, respectively.

For roads, VDOT uses a 30 year life-cycle cost analysis when designing the road and in determining whether to use asphalt or concrete.  Although asphalt generally lasts 10-12 years, while concrete lasts 30, VDOT engineers factor in 2 overlays to the cost of the road for a 30 year useful life expectancy.  This allows them to determine the most cost efficient road surface.  The same reasoning and life-cycle cost analysis is used when designing bridges.  Because the roadways and bridges are designed for a specific useful life, VDOT felt that this would be the best indicator of useful life, as well as the simplest.

Road Inventory - Work in Progress

The average time period to complete a road construction project is 24 months. Based on this, construction expenditures for the fiscal year, two years prior will be capitalized and classified as "work in process" (i.e. in FY01, expenditures for FY99 will be classified). This method of classifying capital expenditures was selected as opposed to tracking each construction project on an individual basis.


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Page last modified: Oct. 14, 2012