UFC 3-701-06
30 March 2006
3-4
MODERNIZATION FACTORS
3-4.1
Definitions
Modernization, along with restoration, improves facilities. Modernization consists
of alteration of facilities solely to implement new or higher standards (including
regulatory changes), to accommodate new functions, or to renew building
components that typically last more that 50 years (such as foundations and
structural members). Restoration includes repair and replacement work to
restore facilities damaged by inadequate sustainment, excessive age, disaster,
accident, or other causes. Restoration and modernization do not include
recurring sustainment tasks or certain environmental measures which are funded
elsewhere. Other tasks associated with facilities operations (such as custodial
services, grounds services, waste disposal, and the provision of central utilities)
are also not included.
3-4.2
Use of Modernization Factors
Modernization factors represent the average annual decrease in facility value
over the expected service life due to obsolescence. Conversely, this value
represents the average annual investment required to preserve the original
facility value, adjusted for inflation, through modernization. As such,
modernization factors are fractional values with no units (such as dollars) that are
used in conjunction with plant replacement value to generate estimates of
modernization funding requirements.
Modernization factors are calculated using the following formula:
Annual modernization factor = total depreciation (%) / expected service life
Where the total depreciation is a percent of total facility
value, and the expected service life is expressed in years for
each FAC.
In turn, the modernization factor is used to generate the average annual
modernization requirement using the following formula:
Modernization requirement = PRV x modernization factor
8
Previous Page
