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Analysis and Abatement Guidance

Appendix F: Determining the Reasonable Cost of Abatement

23 CFR 772.13(d)(2)(ii) requires highway agencies to determine the basis for the reasonable cost of abatement on actual construction costs. One way to determine the reasonable cost of abatement to evaluate the actual unit costs of recently constructed noise barriers in the State and identifying a range of unit costs. This information, coupled with data on the range of costs per residence of constructed noise barriers or in some cases, the square footage of noise barrier per residence will help guide the highway agency to develop the cost reasonableness criteria for the State. The regulation requires reevaluation of the cost reasonableness criteria at a minimum of every five years. States may choose to incorporate an inflation adjustment based on historical or projected trends. One benefit of using the maximum square feet per benefited residence approach is that this value remains constant. Actual costs may increase, but the highway agency guards against stepping away from perceived commitments to provide noise abatement due to escalating costs.

It may be difficult to get a grasp of the actual constructed cost of noise abatement. There are costs associated with a project that a line item in project bid tabulations does not capture. Each highway agency should determine what expenses to include in noise abatement cost valuations. It is valid to simply look at the bid cost of post and panels, but it is equally valid to include other items directly related to providing noise abatement such as design, purchase of right-of-way, maintenance of traffic, deployment costs, clearing and grubbing, grading, reseeding and mulching, cost of safety barriers and any other project costs related to the constructed noise abatement measure. The examples below do not provide all possible cost categories for States to consider, but are illustrative of possible items to include in the cost estimate.

Standalone noise abatement projects, such as Type II projects, can help identify the full unit cost of noise abatement. In a Type II project, the entire project is usually about construction of noise abatement, usually in the form of a noise barrier. The project includes all the associated costs of design and construction, making it pretty easy to divide the total project cost by the square footage of constructed noise barrier to find the unit cost of the project.

The following tables follow an option for project cost projections. Determining project construction cost is the starting point to identifying future costs. Users could also apply these tables at the program level or for future projects help get a better idea of whether a project that is cost reasonable today, will remain cost reasonable years from now given the projection of cost increases predicted to occur between design and construction.

Highway agencies may identify a typical unit cost for noise abatement and identify other features that are project specific. For example, several items shown in the tables below, such as foundations, clearing and grubbing, reseeding, drilled shafts, grading and the barriers, are typical for most projects. Other expenditures, such as purchase of right-of-way, installation of safety barriers and utility relocations are specific to some projects. The noise barrier input function in the TNM provides users with the ability to establish a cost per square foot of wall area, which could include all the typical costs, plus an additional value based on the length of the barrier, which could include atypical costs. This approach avoids assuming the worst case scenario for all projects, but allows highway agencies to account for additional expenses that occur with some projects.

NOTE: The values in the table are illustrative and do not necessarily reflect actual costs.

This table shows the summary of base costs for a noise barrier project without consideration for physical or financial contingencies. The project includes program elements for a standalone noise barrier project.

Tables C1.1 - C1.1.3 provide the input values for the cost of the project program elements. The gray boxes are input values for the number of units needed and the unit cost.

Table C2 gives the opportunity to capture some costs that are not captured in the previous tables. Physical contingencies represent an extra amount to account for changes in project quantities or other added expenses directly related to changes in a particular program element.

Table C3 provides the opportunity to identify the distribution of cost based on the percentage of work completed in each year of the project. This information is not necessary for all projects, or likely, the information is not known during project planning. The information in this table feeds into some of the following tables.

Table C4 give the distribution of cost in constant prices across the life of the project.

Table C5 provides the opportunity to account for inflation across the life of the project. This information carries into Table C6 as the project financial contingencies.

Table C6 provides a summary of total project costs and an outcome of the projects cost reasonableness based on projected costs.