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<br />The O&M expenses have been increasing steadily since the project operation <br />started in FY 1964 due to increases in the costs of labor, supplies, and <br />maintenance parts. Much of the movable equip~ent, which is included as an <br />O&M expense, is nearing the end of its useful', life and requires replacement <br />at a cost far above its original cost. <br /> <br />Figure 13 shows, for the years 1960 through 1981, cost indexes for skilled <br />1 abor and for constructi on machi nery and equipment, taken from the <br />En~ineering News Record and the United States Oepartment of Labor wholesale <br />pn ce index. The graph also shows the cost indexes for CRSP wageboard <br />salaries for the same period. The average annual increases are 7.08 <br />percent for average skilled labor costs in .20 U.S. cities, 6.70 percent for <br />CRSP wageboard salaries, and 6.43 percent fo~ construction machinery and <br />equipment costs in the United States. <br /> <br />Estimates of future CRSP O&M expenses are based on actual <br />historical CRSP costs and experience from other Federal projects. The <br />annual O&M expense estimate for FY 1982 through 1986 is reconciled to the <br />most cu~rent official program budget documents. The FY 1986 estimate is <br />continued for each of the remaining years of, the study except that an <br />additional $827,000 in annual O&M expenses are projected to accompany the <br />addition of the Central Utah powerplants beginning in FY 1990-l991, and <br />small decreases in estimated O&M expenses occur between FY 1996-200l to <br />reflect scheduled reductions in charges for the Parker-Davis Project <br />facility additions made for the delivery of CRSP power. <br /> <br />Column 4 of the power repayment stUdy (Table 2) shows the O&M <br />expenses annually from FY 1964 through FY 2090. The O&M expense of <br />$11,515,000 in FY 1977 was for a l5-month period from July 1, 1976, to <br />September 30, 1977. The O&M cost for the 12~month period ending June 30, <br />1977, was $9,552,000. Actual O&M expense frbm 1978-1981 has been <br />significantly higher than was anticipated in: the FY 1977 repayment study as <br />indicated by the following comparison: <br /> <br />~ FY 1977 Estimate Actual <br />1977 9,552,000 <br />1978 10,133,000 9,112,000 <br />1979 11, l44,000 13,348,000 <br />1980 10,579,000 14,258,000 <br />1981 11,290,000 15,733,000 <br />1978-81 Avg. Ann. Increase 4.3% 13.3% <br /> , <br />Avg. Ann. Inflation (Bureau of Reclamation <br />composite cost index - 197B-198l) 9.4% <br /> <br />The large increase in FY 1979 was due primarily to spillway tunnel repairs <br />at Flaming Gorge and road repairs at Glen C~nyon. Increases in FY 1980 and <br />FY 1981 were due to increased administrativ~ and general expenses, <br />increased CRSP wageboard salaries, and gene~al cost escalations. <br /> <br />36 <br />