ABSTRACT

In 1971, a directive [6] that instituted the requirement for life cycle costing in the procurement of major defense systems was issued by the Department of Defense. In 1974, the state of Florida formally adopted the application of life cycle costing, and the following year, the U.S. Department of Health, Education, and Welfare initiated a project entitled “Life Cycle Budgeting and Costing as an Aid in Decision Making.” In 1978, the National Energy Conservation Policy Act, requiring every new federal building to be life cycle cost-effective, was passed by the U.S. Congress. Since the mid-1970s, many state governm­ ents have passed legislation that requires the performance of life cycle cost analysis to be mandatory in the planning, design, and construction of state buildings (e.g., Texas, Alaska, New Mexico, Maryland).