Estimating Costs

What is the program's current funding? Are the funding mechanisms affected, such as fees, fines or service charges?
Who will experience the cost? The reviewing agency, other agencies or entities, or the constituent? Include discussion on cost regardless of the affected organization; talk to the affected parties.
For major bills that affect broad areas of government, it is okay to only discuss costs to major or representative agencies, based on the time allowed. State such in the discussion.
Determine the future cost implications - current plus two subsequent years. Discuss more years if significant or exceptional.
Estimate all revenues that may be produced by the amendment.
Determine the marginal or additional costs to be incurred for the amendment. Do not use the average cost. (look at quantity discounts, economy of scale)

Samples of Major Cost Areas

Salaries, wages, and related benefits - salaries and wages for full-time, part-time, and seasonal employees by classification.
Operating materials and supplies - normal items required to perform the usual functions of the program, e.g., postage, photocopying, desk-top supplies.
Equipment - office, vehicles, computers.
Contractual services - payment to individuals or organizations outside the government for services.
Grants and subsidies - payments directly to citizens or to non-government agencies or other jurisdictions for services to citizens.
Indirect costs.
Capital expenditures - purchase or construction of major facilities, usually financed differently than other categories.
Increased costs or savings that will be realized in other programs as a result of implementing this alternative.
Savings or additional costs through privatization.