Based on the Cost Calculations in Exhibit 4, the proposed changes to the Haiti project

budget from November 2008 to March 2009 result in a total budget that remains as $5.1M

(i.e., budget neutral). Budget neutrality, also known as a pay-go system, requires that any

proposed changes to one budget category be funded through offsetting cost savings in

another budget category; thus, total budget amounts do not change. Describe what

managerial behavior(s) this budgeting approach promotes.

EXHIBIT 4 Total Deployment Costs for IADB's Pilot Project in Haiti, November 2008 and March 2009 Raw Numbers November March laptops 17000 13700 servers 70 communities 40 40 schools 60 60 students 19000 13200 teachers 500 500 Number cales Students teacher 38 26.4 students school 316.7 220 Cost Calulations November Nov per-laptop March Mar per-laj Training and content $696.336 $4096 $490.743.00 535.82 setup implementation costs $735.664 $43 27 $1,355,827.00 598.97 maintenance $100,000 $5.88 $71.200.00 $5.20 Hardware $3.568.000 $209.$8 $3.182.230.00 5232.28 connectivity $180,090 $10.59 $170.880.00 $12.47 Laptops $3,196,090 $209.88 $2,581,480.00 $188,43 non-laptop hardware costs $192,000 $11.29 $429 870.00 $31.38 Sum $5,100,000 $300.00 $5,100,000.00 $372.26 LADB Budget Changes Given cost totals Nov Mar Difference Materials 370,000 258.100 (111,900) Create Content 190.000 133.500 (56.500) Didactic Materials 180.000 124,600 (55,400) Training 326.336 232,643 (93,693) Immersion Training 80.100 80,100 Summer Camp 137.505 137,505 Community Awareness 4,005 4.005 Process Management 11,033 11,033 Implementation & Eval 720,000 1,096.064 376.064 Project Coordinator 200.000 (200,000) Launch Team 209.328 209.328 Pedagogical and ICT advisors 100.000 108,936 8.936 Local Distribution 100.000 100.000 Field Observation 200.000 100.000 (100.000) Qualatative assessment 200,000 100.000 (100,000) Audit 60.000 60.000 Coordination & Tech Assist 400.000 400.000 Sampling Consultant 20.000 17.800 (2.200) Repair/Maint 100.000 71.200 (28.800) Hardware 3.565,000 3.182.230 (385,770) Energy Systems 0 267.000 267,000 Security Installation 0 16,020 16,020 Connectivity 180,000 170,880 (9,120) Servers 0 80, 100 80. 100 Alternative Power 0 66,750 66.750 Laptops 3,196,000 2,581,480 (614.520) Other? 192,000 (192,000) Contingencies 15.664 259.763 244.099 TOTAL 5.100,000 5,100,000 Source : http ://www.olpcnews.com/implementation/plan/cost of olpc in haiti.html