Replacement Cost Calculation

Agencies can select one of three methods for calculating the replacement cost for State of Good Repair (SOGR) projects.

Replacement Cost	The expected cost to replace an asset is equal to the replacement cost set in the policy. Each asset subtype must be edited and assigned a replacement cost for this option to be effective.
Replacement Cost + Interest	The expected cost to replace an asset is calculated from the replacement cost set in the policy but factors in an annual rate of inflation starting from the fiscal year in which the replacement cost was defined. Each asset subtype must be edited and assigned a replacement cost for this option to be effective.
Purchase Price + Interest	The expected cost to replace an asset is calculated from the purchase price of the asset but factors in an annual rate of inflation starting from the fiscal year that the asset was purchased. This is the default replacement cost calculation method.