Don’t Let Overhead Go Over Your Head – What is the True Cost of Your Maintenance Activities?

2014 APWA International Conference



Don’t Let Overhead Go Over Your Head – What is the True Cost of Your Maintenance Activities?

Every agency needs to know the cost to do their work, whether it’s patching a pothole, repairing a guardrail, or cleaning a sewer line.  Full cost accounting for the work performed is most important. Agencies often bill others for their services.  Assuring total compensation for reimbursable services performed is imperative so that those receiving the service are fairly charged.  Overhead is one of the largest cost components for the work that Public Works does, so it is crucial to know how it is determined.

The application and use of appropriate overhead rates is crucial in this time of budget crisis and financial uncertainty. This discussion will outline several examples and methods for practical use of overhead rates for costing work.

Determining an appropriate overhead rate can ensure adequate compensation for services performed for others as well as establishing benchmarks for cost of service.  This presentation describes the different types of overhead and outlines a specific methodology for calculating an avoidable overhead rate for maintenance operations.

This presentation will identify one agency’s application of overhead.  This will allow attendees to learn how improved understanding of true maintenance costs is a tool and can assist in making the best decisions in cost reduction.  This will allow a better and complete understanding of the benefit of knowing an agency’s overhead rate, and how to apply it using the tools and information provided.



Billy Wright
Consultant, LA Consulting, Manhattan Beach, CA

Kurt Lind
Senior Management Analyst, Mesa Water District, Costa Mesa, CA

Mary Joyce Ivers
Fleet and Facilities Manager, City of Ventura Public Works, Ventura, CA


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