You have received $100,000 from your grandparents to be used for your graduate studies. You plan to start a program in 5 years. You can invest the money at 6% interest, compounded annually. How much will you have in 5 years

QUESTION

6

1. You have received $100,000 from your grandparents to be used for your graduate studies. You plan to start a program in 5 years. You can invest the money at 6% interest, compounded annually. How much will you have in 5 years
2. Mobile Health needs to replace its mobile medical unit to continue providing diagnostic services and preventative medicine to city residents. The van costs $120,000, and a bank is willing to lend the nonprofit the money at a 6% interest rate for 5 years. Payments are due at the end of each month, and interest is compounded monthly. How much should you budget for the monthly payment?
3. The Department of Corrections (DOC) needs to replace two of its prison transports buses. There are two companies that have a track record of making reliable vehicles, and both make a bus that meets the needs of the department. The DOC pays an 8% interest rate on money it borrows. The bus from Company A has a purchase price of $105,000 and a 10-year service life expectancy, and it averages $2,000 per year in maintenance costs. The bus from Company B has a purchase price of $110,000 and a 10-year service life expectancy, and it averages $1,500 per year in maintenance costs. Which bus should the Department of Corrections select?
4. The information technology (IT) department has recently completed a major refurbishment and upgrade of the city’s data center, at a cost of $10,145,825. The chief information officer (CIO) has informed the central budget office that the IT department will need to do the same kind of upgrade in 5 years, and he expects the total cost of that project to be 10% more than this year’s project, accounting for better future technology and future increases in costs. The city does not expect to have enough funding available to pay for the refurbishment in 5 years and must put money away during each of the next 4 years to meet this need. How much money should the city put aside in each of the next 4 years to be able to pay for the data center refurbishment 5 years from now, assuming the city can invest the money at a 4.5% interest rate?
5. The local community center has been notified that it is the beneficiary of an endowment. The community center can accept cash today in the amount of $550,000 or receive $875,000 in 5 years. The community center expects to be able to invest the money at a 5% interest rate if it were to take the money now. Should it take the money now or wait?
6. The municipal golf course has made a budget request to remodel and upgrade the clubhouse. The project will cost $7,200,000, based on reliable estimates. The additional annual operating expenses after the upgrade are expected to be $200,000 per year. An analysis of the experiences of other municipal golf courses reveals an expected revenue increase of $1 million per year after the upgrade. The useful life of the upgraded clubhouse is estimated at 9 years, and the golf course expects to get a loan for the renovations at an interest rate of 4.25%. Should the renovations be approved?

Module 9

1. The state department of health (DOH) is considering implementing several performance measures. In a meeting with the central budget office, DOH officials are discussing their options and seeking advice on which measures to include. Identify the type of measure each statement represents and indicate whether you would recommend it be implemented or not, and why.

(a) Number of measles-mumps-rubella (MMR) shots given to 2-year-olds

(b) Percentage of 2-year-olds who are up-to-date on MMR vaccinations

(c) Number of smoking-cessation classes provided

(d) Number of teens attending smoking-cessation classes

(e) Number of workshop materials copied for classes

(f) Percent of high school students who smoke two cigarettes or more per week

(g) Percent of state population diagnosed with lung cancer

(h) Percent of class attendees who indicated satisfaction with the smoking-cessation class

2. The city’s planning department is seeking additional funding for staff and supplies to support its permit inspection activity. As businesses and homeowners reach milestones in their building process, they call for a permit inspection so they can begin the next phase of their building project. They use this output measure: percent of permit inspections provided within 24 hours of request. The planning department has provided the graph in Figure 9.1 to demonstrate its performance. Assuming staffing and funding have been consistent over the period depicted in this graph, do you recommend additional staff and funding? What questions do you have?
3. The city planning director has realized that her request may not have been compelling, so she provides you with some additional information, shown in Figure 9.2. Does this change your recommendation?

4. Maricopa County’s Public Defense Services Agency (the public defender’s office) tracks performance metrics very closely. Table 9.2 is from the FY [Fiscal Year] 2014 Annual Business Strategies: Adopted Budget document. Examine the trends and the connections between the measures and the expenditure dollars. Does the FY 2014 adopted budget seem reasonable?
5. Sky High School has significant student dropout and failure rates among its senior-year classes. To address this issue, it has obtained grant funding for the senior class. Because this problem appears to be dispersed across the entire senior class, some elements of the program serve all the seniors, even those who appear successful and on track toward graduation throughout the year. The objective of the program is for the students to complete the senior year and graduate. Success of this retention program is determined to be graduation. The data in Table 9.3 are available.

Please provide measures of process and financial measures of efficiency and effectiveness. Is the Sky High School guidance office making progress towards its mission? Why or why not?

Module 13

The following case is for use with assignment 1.

6. These rounded numbers are reported in the budget justification. To balance, the rounded values of the “Other” category are adjusted.

FluQ Case

FluQ CaseYou have been invited to a department meeting to help develop a budget request for the upcoming legislative session. A new strain of the flu has been sweeping your region, and the vaccine FluQ has just been approved for children under age 12. The public health department you work for is taking the lead in vaccinating children in 30 elementary schools in the region. During the meeting, the program manager presents the following information.

The program will have three components. First, education is needed in each of the schools. The program manager wants to do a series of five in-person, 2-hour meetings—with one doctor, two nurses, and two administrative staff per meeting—as well as providing each child with an educational coloring book. Each school has 1,200 children.

Second, the vaccination clinics will be held at the schools. Children will be vaccinated when their parent or guardian signs the permission slip. Some health conditions rule out certain children as good candidates for vaccination. It is estimated that each school has 1,000 children who should receive the FluQ vaccination. In other states like yours, approximately 8% of parents refuse to have their child vaccinated. Vaccinations and associated supplies cost $2 per dose. On each vaccination clinic day, a doctor must be present. Nurses will be responsible for administer-ing the vaccine. On average, it takes approximately 6 minutes to process a child and administer the vaccination.

Lastly, federal and state regulations require the reporting of all FluQ vaccinations administered. Additionally, the school administration and the parents have requested aggregated reports regarding the vaccination coverage in the region. It is estimated that for each child receiving the vaccination, 10 minutes will be required to record and save the necessary data in the various databases. For children not receiving the vaccine (either because of parental refusal or because the child was not a good candidate for the vaccine), it will take 5 minutes to record and save the necessary data. An additional 3 weeks of analysis and reporting are estimated to be required at the conclusion of each FluQ vaccination season to meet reporting requirements. Assume two administrative staff are working on the entire reporting segment.

While FluQ is a new vaccination, it is anticipated that it will need to be administered every year for the next 3 years to the same group of children. Population growth in your region has been stable for some years and is expected to remain stable soon. You have the following information:

The average wages for department staff are as follows: doctors—$95/hour; nurses—$64/hour; administrative staff—$32/hour.

Because these are temporary roles, the only benefits are the legally required FICA, HI, workers’ comp, and unemployment benefits. The last two are estimated at 2% of payroll.

Coloring books (including design and printing) had a cost of about $1.75 per book when used in another project that was like this one.

Based on other vaccination campaigns, the cost of this campaign will be about $10,000 for data-base administration and computer setup for the program each year.

1. Prepare a cost estimate using the format of Appendix A to this module.
2. As a substantial project, choose a topic involving a potential program within your locality and prepare a cost estimate.Module 6
   1. You have received $100,000 from your grandparents to be used for your graduate studies. You plan to start a program in 5 years. You can invest the money at 6% interest, compounded annually. How much will you have in 5 years
   2. Mobile Health needs to replace its mobile medical unit to continue providing diagnostic services and preventative medicine to city residents. The van costs $120,000, and a bank is willing to lend the nonprofit the money at a 6% interest rate for 5 years. Payments are due at the end of each month, and interest is compounded monthly. How much should you budget for the monthly payment?
   3. The Department of Corrections (DOC) needs to replace two of its prison transports buses. There are two companies that have a track record of making reliable vehicles, and both make a bus that meets the needs of the department. The DOC pays an 8% interest rate on money it borrows. The bus from Company A has a purchase price of $105,000 and a 10-year service life expectancy, and it averages $2,000 per year in maintenance costs. The bus from Company B has a purchase price of $110,000 and a 10-year service life expectancy, and it averages $1,500 per year in maintenance costs. Which bus should the Department of Corrections select?
   4. The information technology (IT) department has recently completed a major refurbishment and upgrade of the city’s data center, at a cost of $10,145,825. The chief information officer (CIO) has informed the central budget office that the IT department will need to do the same kind of upgrade in 5 years, and he expects the total cost of that project to be 10% more than this year’s project, accounting for better future technology and future increases in costs. The city does not expect to have enough funding available to pay for the refurbishment in 5 years and must put money away during each of the next 4 years to meet this need. How much money should the city put aside in each of the next 4 years to be able to pay for the data center refurbishment 5 years from now, assuming the city can invest the money at a 4.5% interest rate?
   5. The local community center has been notified that it is the beneficiary of an endowment. The community center can accept cash today in the amount of $550,000 or receive $875,000 in 5 years. The community center expects to be able to invest the money at a 5% interest rate if it were to take the money now. Should it take the money now or wait?
   6. The municipal golf course has made a budget request to remodel and upgrade the clubhouse. The project will cost $7,200,000, based on reliable estimates. The additional annual operating expenses after the upgrade are expected to be $200,000 per year. An analysis of the experiences of other municipal golf courses reveals an expected revenue increase of $1 million per year after the upgrade. The useful life of the upgraded clubhouse is estimated at 9 years, and the golf course expects to get a loan for the renovations at an interest rate of 4.25%. Should the renovations be approved?

    

   Module 9

   1. The state department of health (DOH) is considering implementing several performance measures. In a meeting with the central budget office, DOH officials are discussing their options and seeking advice on which measures to include. Identify the type of measure each statement represents and indicate whether you would recommend it be implemented or not, and why.

   (a) Number of measles-mumps-rubella (MMR) shots given to 2-year-olds

   (b) Percentage of 2-year-olds who are up-to-date on MMR vaccinations

   (c) Number of smoking-cessation classes provided

   (d) Number of teens attending smoking-cessation classes

   (e) Number of workshop materials copied for classes

   (f) Percent of high school students who smoke two cigarettes or more per week

   (g) Percent of state population diagnosed with lung cancer

   (h) Percent of class attendees who indicated satisfaction with the smoking-cessation class

   2. The city’s planning department is seeking additional funding for staff and supplies to support its permit inspection activity. As businesses and homeowners reach milestones in their building process, they call for a permit inspection so they can begin the next phase of their building project. They use this output measure: percent of permit inspections provided within 24 hours of request. The planning department has provided the graph in Figure 9.1 to demonstrate its performance. Assuming staffing and funding have been consistent over the period depicted in this graph, do you recommend additional staff and funding? What questions do you have?
   3. The city planning director has realized that her request may not have been compelling, so she provides you with some additional information, shown in Figure 9.2. Does this change your recommendation?

    

   4. Maricopa County’s Public Defense Services Agency (the public defender’s office) tracks performance metrics very closely. Table 9.2 is from the FY [Fiscal Year] 2014 Annual Business Strategies: Adopted Budget document. Examine the trends and the connections between the measures and the expenditure dollars. Does the FY 2014 adopted budget seem reasonable?
   5. Sky High School has significant student dropout and failure rates among its senior-year classes. To address this issue, it has obtained grant funding for the senior class. Because this problem appears to be dispersed across the entire senior class, some elements of the program serve all the seniors, even those who appear successful and on track toward graduation throughout the year. The objective of the program is for the students to complete the senior year and graduate. Success of this retention program is determined to be graduation. The data in Table 9.3 are available.

   Please provide measures of process and financial measures of efficiency and effectiveness. Is the Sky High School guidance office making progress towards its mission? Why or why not?

    

   Module 13

   The following case is for use with assignment 1.

   6. These rounded numbers are reported in the budget justification. To balance, the rounded values of the “Other” category are adjusted.

   FluQ Case

   FluQ CaseYou have been invited to a department meeting to help develop a budget request for the upcoming legislative session. A new strain of the flu has been sweeping your region, and the vaccine FluQ has just been approved for children under age 12. The public health department you work for is taking the lead in vaccinating children in 30 elementary schools in the region. During the meeting, the program manager presents the following information.

   The program will have three components. First, education is needed in each of the schools. The program manager wants to do a series of five in-person, 2-hour meetings—with one doctor, two nurses, and two administrative staff per meeting—as well as providing each child with an educational coloring book. Each school has 1,200 children.

   Second, the vaccination clinics will be held at the schools. Children will be vaccinated when their parent or guardian signs the permission slip. Some health conditions rule out certain children as good candidates for vaccination. It is estimated that each school has 1,000 children who should receive the FluQ vaccination. In other states like yours, approximately 8% of parents refuse to have their child vaccinated. Vaccinations and associated supplies cost $2 per dose. On each vaccination clinic day, a doctor must be present. Nurses will be responsible for administer-ing the vaccine. On average, it takes approximately 6 minutes to process a child and administer the vaccination.

   Lastly, federal and state regulations require the reporting of all FluQ vaccinations administered. Additionally, the school administration and the parents have requested aggregated reports regarding the vaccination coverage in the region. It is estimated that for each child receiving the vaccination, 10 minutes will be required to record and save the necessary data in the various databases. For children not receiving the vaccine (either because of parental refusal or because the child was not a good candidate for the vaccine), it will take 5 minutes to record and save the necessary data. An additional 3 weeks of analysis and reporting are estimated to be required at the conclusion of each FluQ vaccination season to meet reporting requirements. Assume two administrative staff are working on the entire reporting segment.

   While FluQ is a new vaccination, it is anticipated that it will need to be administered every year for the next 3 years to the same group of children. Population growth in your region has been stable for some years and is expected to remain stable soon. You have the following information:

   The average wages for department staff are as follows: doctors—$95/hour; nurses—$64/hour; administrative staff—$32/hour.

   Because these are temporary roles, the only benefits are the legally required FICA, HI, workers’ comp, and unemployment benefits. The last two are estimated at 2% of payroll.

   Coloring books (including design and printing) had a cost of about $1.75 per book when used in another project that was like this one.

   Based on other vaccination campaigns, the cost of this campaign will be about $10,000 for data-base administration and computer setup for the program each year.

   1. Prepare a cost estimate using the format of Appendix A to this module.
   2. As a substantial project, choose a topic involving a potential program within your locality and prepare a cost estimate.

   3. ANSWER