DEVELOPMENT OF UNIFORM PROCEDURES FOR ESTABLISHING CONSTRUCTION EQUIPMENT RENTAL RATES

A SURVEY OF STATE HIGHWAY DEPARTMENT PRACTICES DETERMINED THAT THE MAJOR CURRENT USE OF RENTAL RATES IS TO REIMBURSE CONTRACTORS FOR EQUIPMENT COSTS WHEN UNIT PRICES FOR CONSTRUCTION WORK DO NOT APPLY. THE RATES USED REPRESENT MODIFICATIONS OF THE ASSOCIATED EQUIPMENT DISTRIBUTORS RENTAL RATES OR ARE BASED ON THE ASSOCIATED GENERAL CONTRACTORS OF AMERICAS SCHEDULE OF EQUIPMENT OWNERSHIP COSTS. THE USE OF THESE BASES HAS CERTAIN DEFICIENCIES BECAUSE' THEY ARE NATIONAL AVERAGES, THEY INCLUDE INAPPLICABLE COSTS, AND SUCH FORMULAE DO NOT RECOGNIZE THAT EQUIPMENT USED MAY BE FULLY DEPRECIATED. AN EXAMINATION OF THE BASES REPORTED BY THE STATES LED TO AN IDENTIFICATION OF THE APPROPRIATE EQUIPMENT COSTS AND OTHER FACTORS PERTINENT TO RATE DETERMINATION. A FORMULA TO EXPRESS EQUIPMENT COSTS AS AN HOURLY RATE WAS DEVELOPED. A CASE STUDY WAS MADE TO EXPERIENCE THE PROBLEMS OF APPLYING THE FORMULA AND TO DEMONSTRATE THE DEVELOPMENT OF RENTAL RATES. THE GUIDELINES WERE DEVELOPED ON THE PREMISE THAT THE RATES AT WHICH CONTRACTORS ARE REIMBURSED FOR EQUIPMENT USE SHOULD BE BASED ON ACTUAL COSTS, AND COST INFORMATION SHOULD BE SUSCEPTIBLE TO VERIFICATION BY THE HIGHWAY DEPARTMENT. THE COST SYSTEM OUTLINED CAN BE APPLIED TO THE ACCOUNTING FOR STATE-OR COUNTY-OWNED EQUIPMENT. RATES USED INTERNALLY FOR THE ALLOCATION OF EQUIPMENT COSTS TO MAINTENANCE DISTRICTS OR OTHER COST CENTERS WOULD BE ON A SIMILAR FULLY-ALLOCATED COST BASIS.

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    • Distribution, posting, or copying of this PDF is strictly prohibited without written permission of the Transportation Research Board of the National Academy of Sciences. Unless otherwise indicated, all materials in this PDF are copyrighted by the National Academy of Sciences. Copyright © National Academy of Sciences. All rights reserved. No 26, 33 PP, 3 FIG, 11 TAB, 12 REF, 1 APP, PROJ NO 13-1
  • Authors:
    • Dudick, T S
    • Ravenscroft, F I
  • Publication Date: 1966

Media Info

  • Media Type: Digital/other
  • Serial:
    • NCHRP Report
    • Issue Number: 26
    • Publisher: Transportation Research Board
    • ISSN: 0077-5614
  • Publication flags:

    Open Access (libre)

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Filing Info

  • Accession Number: 00218141
  • Record Type: Publication
  • Files: TRIS, ATRI
  • Created Date: Nov 18 1994 12:00AM