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Comparison Model of Service Delivery Options B & C <br /> The comparison model looks at the cost difference between the City of Eugene delivering the service and <br /> an alternative service delivery option. The model will use a minimum of two years (Transition year and first <br /> year of operations) and upwards to six years (or more) of forecast data depending on the length of the <br /> contract. <br /> Service Delivered by the Avoidable Costs <br /> City of Eugene Current Annual Cost Transition <br /> of Service Year Year 1 up to Year 6 <br /> Salary/Wages $xC $xT $x1 ... $xl <br /> Pension & Benefits $xC $xT $xl ... $xl <br /> Materials $xC $xT $xl ... $xl <br /> Training $xC $xT $xl ... $xl <br /> Professional Services $xC $xT $xl ... $xl <br /> Facilities Maintenance $xC $xT $x1 ... $xl <br /> Fleet Maintenance $xC $xT $xl ... $xl <br /> Info Svcs Maintenance $xC $xT $xl ... $xl <br /> Total Costs $X $XT $X1 ... $X1 <br /> Costs/Revenue <br /> Alternative Service Delivery Costing Model Transition <br /> Year Year 1 up to Year 6 <br /> Bid Price $YT $Y1 $Y1 <br /> Contract Administration by the city $yT $yi $371 <br /> Transition Costs $YT $3 $Y' <br /> Costs Subtotal $YT $Y1 $Y1 <br /> Revenue from the sale of unused assets ($Y ($ ... ($ <br /> Net Cost (Costs - Revenue) $Y $I' ... $Y1 <br /> ANALYSIS <br /> Compare the Cost of Delivery by the City of Eugene versus Alternative Service Provider. <br /> If the cost difference is less than 10 %, then the service options are considered competitive <br /> depending on the potential impact of the change. <br /> D. In- sourcing a Service or Analysis of a New Service <br /> The costing model still holds in the cases where the organization wishes to in- source a service or assess the <br /> method for delivery of a new service. The user would no longer use the concept of avoidable costs. Instead, <br /> the costing model would be a mixture of the City of Eugene Service Delivery Costing Model and <br /> Alternative Service Delivery Costing Model. The user would account for transition costs, staff costs, <br /> material and service expenses, and administration expenses (if applicable). This analysis would then be <br /> compared against other service delivery options. <br /> Other Factors to Consider <br /> Present value comparison and sensitivity analysis. <br /> 6 <br />