EXAMPLE 9.3 The the out corgia Transportation Directorate is considering a public-private partnership with Young nstruction as the prime contractor using a DBOMF contract for a new 22.51-mile toll road on outskirts of Atlanta's suburban area. The design includes three 4-mile-long commercial corndors on both sides of the toll road. Highway construction is expected to require retail corrid 5 years at an average cost of $3.91 million per mile. The discount rate is 4% per year, an study period is 30 years. Evaluate the economics of the proposal using (a) the modified analysis from the State of Georgia perspective and (b) the profitability index from the Y corporate viewpoint in which disbenefits are not included. d the Initial investment: $88 million distributed over 5 years; $4 million now and in year $20 million in each of years 1 through 4. Annual M&O cost: $1 million per year, plus an additional $3 million each fifth year, includ ing year 30. Annual revenue/benefits: Include tolls and reta year 1, increasing by a constant $0.5 million annually through year 10, and then increasing a constant $1 million per year through year 20 and remaining constant thereafter. Estimable disbenefits: Include loss of business income, taxes, and property value in sur- rounding areas; start at $10 million in year 1, decrease by $0.5 million per year through year 21, and remain at zero thereafter. ail/commercial growth; start at $2 million in by EXAMPLE 9.3 The the out corgia Transportation Directorate is considering a public-private partnership with Young nstruction as the prime contractor using a DBOMF contract for a new 22.51-mile toll road on outskirts of Atlanta's suburban area. The design includes three 4-mile-long commercial corndors on both sides of the toll road. Highway construction is expected to require retail corrid 5 years at an average cost of $3.91 million per mile. The discount rate is 4% per year, an study period is 30 years. Evaluate the economics of the proposal using (a) the modified analysis from the State of Georgia perspective and (b) the profitability index from the Y corporate viewpoint in which disbenefits are not included. d the Initial investment: $88 million distributed over 5 years; $4 million now and in year $20 million in each of years 1 through 4. Annual M&O cost: $1 million per year, plus an additional $3 million each fifth year, includ ing year 30. Annual revenue/benefits: Include tolls and reta year 1, increasing by a constant $0.5 million annually through year 10, and then increasing a constant $1 million per year through year 20 and remaining constant thereafter. Estimable disbenefits: Include loss of business income, taxes, and property value in sur- rounding areas; start at $10 million in year 1, decrease by $0.5 million per year through year 21, and remain at zero thereafter. ail/commercial growth; start at $2 million in by