Meeting the Requirements for Lease vs Buy Analysis: A Case Study
Abstract
With the recently-released OMB Circular A-94, 'Guidelines and Discount Rates for Benefit-Cost Analysis of Federal Program' the issue of how to perform a useful cost-benefits and/or cost-effectiveness analysis to assist government acquisition is once again on the table in the cost analysis community. Experience has shown that cost analysis is an ever-changing science, and modeling efforts are continuing to keep in step with new requirements and to reflect new practices. This paper discusses a model developed to assist the National Oceanic and Atmospheric Administration (NOAA) with lease-vs. buy analysis for the Fleet Replacement and Modernization (FRAM) Program. This model incorporates the latest OMB guidance and is flexible enough to meet changing economic and market conditions as well as changes in government and business practice. The NOAA Economic Model (NEM) was developed to support the ship acquisition decision and meet federal requirements for cost analysis. The NEM is the result of extensive primary and secondary research, working closely with the NOAA FRAM Program Manager (PM), and an Independent Verification and Validation (IV&V) by an internationally recognized consulting firm with specific experience in ship acquisition.
Document Details
- Document Type
- Technical Report
- Publication Date
- Sep 01, 1993
- Accession Number
- ADA275796
Entities
People
- Deborah J. Wigler