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Life Cycle Cost

Life Cycle Cost

Life cycle cost (LCC) is an essential technique for evaluating the total cost of ownership between mutually exclusive alternatives. Executive Order 13123 requires government agencies to use life cycle cost
analysis (LCCA) to minimize the government’s cost of ownership. Unfortunately, many stakeholders do not understand the concept of cost and proceed to reduce project acquisition (first) cost rather than the total project cost. However, over the life of the project, facility management cost is often two to three times higher than acquisition
costs. Therefore, it is essential to design for minimum facility management costs.

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