Figure 1. Base condition

ERDC TN-DOER-C27

July 2002

analysis should assume that the costs incurred for the new facilities are expended such that

the new facility becomes available just as the existing facilities reach their capacity.

2. Calculate the average annual cost of dredging and disposal for each scenario. Correlate the

cost of each action required (dredging, transportation, CDF construction, offsite disposal,

etc.) with the timing of the action. This is illustrated in Figure 1. Discount the cost from

the time incurred to its present value using the Federal discount rate1. Sum all the present

values and amortize over the period of analysis. The least-cost method will have the lowest

present value and lowest average annual cost. This method is the base condition and will

be used to measure the cost and benefits of physical separation. A conceptual example of

the base condition is depicted in Figure 1. It shows the existing CDF being expanded by

raising the berms and then later being replaced by construction of a new CDF of sufficient

capacity to last the remainder of the period of analysis.

Figure 1. Base condition

Formulating Physical Separation Alternatives

There are three general separation scenarios that could be formulated to extend the life of an existing

CDF:

1) Volume reduction of incoming material.

2) Capacity recovery, i.e., removal of materials previously placed.

3) Capacity recovery and volume reduction of incoming material.

Section 1.4.11 of the Economic and Environmental Principles and Guidelines for Water and Related Land

Resources Implementation Studies requires discounting of future monetary values to present values. The

discount rate is established each year and published in an Economics Guidance Memorandum by the Planning

and Policy Division of the Directorate of Civil Works.