Economic considerations module: introduction | construction costs | operation and maintenance costs | safety and other liability risks | property value | recreational value | aesthetic value | ecological value | references | appendix

Operation and maintenance costs

Repair

Operation and maintenance costs as the result of dam repair vary greatly depending on the size and condition of the dam. Operation could be as simple and low cost as annual inspections of the dam or it could include more involved inspections and upkeep. In addition to operation costs, continued maintenance is required after the initial repair is completed to keep the dam in sound condition.

Operation and maintenance cost estimates should be obtained from local engineers or consultants. The difficulty here for your worksheet calculation is in comparing an annual and continuing expense to one-time expenses (like dam demolition). That is, how do you compare the costs of a $100,000 one-time construction fee and a $5,000 operation and maintenance payment that will need to be made every year for as long as the dam remains standing?
 


Figure 4. On-site inspection of a dam.


This annual cost issue will come up again with other categories in this module, and these annual fees can be significant as they accrue over time. Your economic worksheet will consider the economic issues of your community as it is currently composed. As such, perhaps a consideration of annual costs for the next 100 years unnecessarily includes expenditures that should properly and fairly be left for future generations to weigh. Rather than engage in other complicated forms of estimation, the suggestion here is to pick a reasonable time frame for which your community is likely to still be the "same" community. There is a legal basis for using 10 years (see the Legal Aspects module) as a reasonable time frame for your community to hold itself liable to pay for an ongoing obligation. A hypothetical calculation might look like this:

 ($5,000 annual operation and maintenance costs) x (10 years) = ($50,000 total cost estimate).

Another cost to consider is the regular “maintenance” of the impoundment. The impoundment is a receptacle for sediment that is being delivered to it by the river from the watershed. If enough sediment is trapped behind the dam, the depth of the impoundment will be greatly diminished. The depths of impoundments may have decreased so much that dredging is required to maintain its usefulness for recreation. This can be very expensive and a continual cost during the remainder of the life of the dam. For example, at the Bloomer Dam on Duncan Creek, Wisconsin, dredging was estimated to cost $3.50 per cubic yard. This equated to $553,000 for a 1-foot increase in the depth of the entire 98-acre impoundment. Maintenance costs of an impoundment are usually the result of decreased depths due to sedimentation. As the depth of an impoundment decreases, it becomes a better producer of aquatic vegetation. To maintain the recreational usefulness of the impoundment, regular weed harvesting may be needed. These costs, which will be sporadic, should also be estimated for a reasonable time frame, such as 10 years.

Examples: Repair

Waterworks Dam, Baraboo River, Wisconsin
• Annual operation cost: $3,900
• Future maintenance: $200,000, calculated as 20% of estimated repair cost
Bloomer Dam, Duncan Creek, Wisconsin
• Dam maintenance costs: unspecified amount
• Dredging : $553,000 per foot for the 98-acre impoundment, $3.50 per cubic yard estimate
Rockdale Dam, Koshkonong Creek, Wisconsin
• Estimated maintenance on dam with stop-gap repairs: $8,000 a year
• Estimated maintenance on dam with full restoration of structure: $2,000 per year
Ward Paper Mill Dam, Prairie River, Wisconsin
• Estimated annual operation and maintenance costs: $20,000 - $50,000
Shopiere Dam, Turtle Creek, Wisconsin
• Continued removal of trees and brush around dam: unspecified amount
• Dam was ownerless and not maintained: no operation and maintenance costs

Removal

Operation and maintenance costs as the result of a removed dam may seem to be zero. However, it is important to consider the potential costs of operating and maintaining the land of the old impoundment. This land might be put into or kept in public ownership and converted into park land or natural areas. This type of land use certainly has operation and maintenance costs just as any other park or natural area would. A community parks office will be able to estimate the cost of operating and maintaining these new areas.

The operation and maintenance costs of a dam removal site will vary greatly depending on the site-specific situation and the number of amenities the area has. The annual upkeep price you arrive at will have to be adjusted in the same way that other annual and continuing expenses have been estimated in this module for inclusion in your worksheet. (See the Repair part of the Safety and Other Liabilities section of this module for more detail.)

Examples: Removal

Woolen Mills Dam, Milwaukee River, Wisconsin
• Approximately $3000 per year for the city of West Bend to maintain 61-acre Riverside Park on the former impoundment bed (Peter Vagnini, West Bend Parks Department, verbal communication, 2000)
Colfax Dam, Eighteen Mile Creek, Wisconsin
• Maximum of $500 per year for maintenance and minor habitat work at park located on former impoundment bed (Steve Brill, Milwaukee County Department of Parks, Recreation and Culture, verbal communication, 2000)
North Avenue Dam, Milwaukee River, Wisconsin
• Average cost (past three years) to maintain Caesar Park that sits on the former impoundment bed is $3,000 (James Holzer, Wisconsin Department of Natural Resources, verbal communication, 2000)

 

Next section: Safety and other liability risks

URL: http://www.ies.wisc.edu/research/wrm00/econoper.htm