Non-Environmental Cost-Benefit News

Field trials in Illinois examine cost savings from using on-farm generated compost and fewer irrigation cycles to grow crops.

Popcorn or soybeans are grown in rotation, and normal tillage, herbicide and irrigation scheduling have been used.

The study is using nine subplots - three plots with compost applied at 20 wet tons/acre/year, three plots at a rate of 10 wet tons/acre/year and three with no compost.

THE number of on-farm composting facilities in the Midwest has steadily increased over the last five to ten years. Several livestock producers in Illinois - particularly those near urban areas in the central and northern parts of the state - have initiated projects utilizing livestock waste and yard materials. Finished compost usually is applied to crop fields operated by these producers.

Overall, soils in the upper Midwest are excellent for growing agricultural crops. High inherent fertility and water retention allow this area to grow corn, soybeans and other commodities with high yield potential. However, there are pockets of poorer soils present. For example, several areas in Illinois are mostly sand, such as in Mason County, located in the center of the state. Soils in this area have very low water holding capabilities, but are also over an immense shallow aquifer. The majority of acreage in the county is irrigated by center pivot irrigation systems. This area, sometimes referred to as the "Imperial Valley" of the Midwest, grows a variety of crops, including field corn, soybeans, snap beans, potatoes, popcorn, pumpkins, watermelons and cantaloupe.

As energy costs spiral upward, the costs of irrigation increases as well. This situation led University of Illinois Extension staff to pose the following question: If there is a potential for decreasing the number of irrigation cycles needed to grow a crop by incorporating compost, would it pay?

Research conducted at the University of Wisconsin provided insights on the effects of compost application on plant available water. The research examined short and intermediate term use of paper mill residuals and composted residuals in sandy soils in central Wisconsin. Amendments were applied at the rates of 10 to 20 dry tons/acre; plots were planted in a rotation of potatoes and snap beans. Following the second application of amendments, amended plots increased plant available water by five to 45 percent compared to no amendment. This reduced the average amount of irrigation water needed by ten to 90 percent - a potential for reducing the number of irrigation cycles by two to seven.

To determine the potential cost savings of reducing irrigation needs, a program from Kansas State University was employed. This program allows one to input the size of the irrigation system, how much water is applied per cycle, how many feet the water has to be lifted, and the type of energy used - electric, propane, diesel or natural gas (Figure 1).

Using current (fall 2004) energy prices for central Illinois, adding one inch of water for a standard 130-acre system would cost from $160 (electric) to $347 (diesel or propane). If the number of irrigation cycles could be reduced by two to seven cycles per season, the potential cost savings would range from $320 to over $2,400/year on a 130-acre system, depending on the number of cycles reduced and the energy source.

Though results from research may be applied to other areas, many producers like to see research under local conditions. This is particularly true for producers in Mason County, which has soils and groundwater conditions relatively unique to the state. To address this need, a multiyear study was initiated to examine using compost on irrigated cropland in the county.

A number of cooperators, including University of Illinois Extension, Illinois State University, the Mason County Irrigated Growers Association, the Mason County Farm Bureau, and the Mason County Soil and Water Conservation District have participated in the study. Partial funding was supplied through the Illinois Department of Agriculture Sustainable Agriculture Grant Program.

The study utilizes nine subplots. Three of the plots receive 20 wet tons/acre of compost annually (moisture content estimated between 40 and 50 percent). Three more receive 10 wet tons/acre, and the other three receive no compost. Application began in 2002. Compost is supplied by Illinois State University, which has a composting facility at its research farm. It is made from a combination of hog and some cow manure and yard trimmings (mostly fall leaves) from the city of Normal. Popcorn or soybeans are grown in rotation, and normal tillage, herbicide, and irrigation scheduling have been used.

As expected, annual soil testing has shown a significant increase in cation exchange capacity (the ability of soil to hold nutrients) in plots where the highest rates of compost were applied (Figure 2). Organic matter contents also appear to have increased, although the increase is not yet statistically significant (Figure 3).

Average relative soil water content has been checked weekly during the growing season (Figure 4). A reading of 100 percent means that the soil is at field capacity, or holding as much plant available water as possible. Again, at the 20 wet tons/acre rate, the relative water content appears to have increased slightly, but not yet enough to be statistically significant. It was apparent that in some weeks irrigation needed to be more frequent, as some readings produced very low or even negative readings. In theory, this should have made the plots with compost, which contained a little more water, a better growing environment. Yield results to date, which may have increased slightly in the compost-amended plots, are not yet statistically significant.

A variable that may be offsetting the effect of compost is field slope, which is about two percent. Moisture readings, and yields, are consistently higher on the lower end of this slope. It may take several more compost applications before this variable is not an overriding factor. Another factor in play is the amount of compost being used. Higher initial rates of application would likely have been beneficial. Researchers applied compost at a wet ton rate due to a misinterpretation of an Illinois Environmental Protection Agency regulation. Next year, application rates of 10 and 20 dry tons/acre (acceptable under Illinois EPA guidelines for agronomic application) will be used instead of wet ton rates. This will essentially double the amount of compost being applied.

If producers are already composting, there may be potential for cost savings from reducing irrigation cycles. For the best effect, higher rates of application would be needed - i.e., 20 dry tons/acre would be better than 10. A farm making 4,000 to 6,000 dry tons/year of compost could supply enough compost for 200 to 300 acres/year.

Obviously there would be a cost for producing and applying the compost, but if someone were already composting, the costs would already be a part of the operation. However, an irrigator examining costs and benefits associated with starting and operating a composting facility may want to include the potential for reducing irrigation needs in the decision making process.

Buying the compost from an outside source and applying it would likely not be worth the cost savings from reduced irrigation alone. Other benefits from adding compost as a soil amendment would need to be included in the cost/benefit analysis.

Research conducted at the University of Wisconsin found compost-amended plots increased plant available water by five to 45 percent compared to no amendment.

A farm making 4,000 to 6,000 tons/year of compost could supply enough for application to 200 to 300 acres/year at a rate of 20 tons/acre.

by Duane Friend. December 2004 Volume 45, Issue 12; page 33, 3 pgs
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Biocycle

Three-quarters of U.S. and European multination.Is use outsourcing or shared services to support financial functions-but less than half consider outsourcing to be cost effective, according to PricewaterhouseCoopers' Management Barometer Survey (PwC; www.pwc.com). Despite this finding, 29% of the companies expect to increase their outsourcing of financial functions.

"Companies that turn to outsourcing for cost savings should conduct comprehensive feasibility studies to better understand their potential return on investment," said Dan DiFilippo, global leader for performance improvement and U.S. leader for governance, risk, and compliance at PwC. "Many companies enter outsourcing arrangements without conducting a proper cost-benefit analysis."

Of the respondents to the PwC survey, 31 % see limited or very little benefit to outsourcing, 44% report that their organizations have saved a moderate amount, and 3% saved a great deal.

Another survey that assessed the costs and results of outsourcing came to a different conclusion from the PwC research, at least with regard to outsourcing training. Bersin & Associates' (www.bersin.com) Training Outsourcing: What Works(TM) reports that outsourcing saves money and staff: Companies that outsource training functions spend 31 % less per learner than those operating internal training operations ($827 vs. $1,191). Training outsourcers also have 26% fewer training staff per learner (7.8 staff per thousand learners) than internal training programs (10.5 staff per thousand learners).

HR Focus January 2005 Volume 82, Issue 1; page 8
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After a couple of years of better cattle prices, it's easy to think about updating cattle facilities. Whether or not that's the best decision for an operation depends on a number of factors.

Dave Kesteloot, Form-A-Feed, Inc., of Marshall, Minn., has spent over 30 years promoting beef solutions - from building new facilities, to updating current facilities, to increasing efficiencies for better profitability.

The following are some of his suggestions when considering a new facility or making some changes to the existing feedlot operation.

A cattleman with fantastic facilities that are fully depreciated earns 10 cents per head per day more than the cattleman who is paying for new facilities.

"Every 200 days, they are $20 ahead of the rest of us that have to spend money on new facilities or some major improvements," said Kesteloot. "Hopefully, our investment is taking us in the right direction."

# Getting the cattle comfortable is the number one concern, especially in mound yards.

If cattle are walking through mud and manure, the cattleman needs to look at that situation and see what can be changed.

Research out of Carrington, N.D., shows using bedding will impressively improve gain, feed efficiency and grade. In 2003 and 2004, bedding paid over no bedding about $45 per head.

Many cattlemen can improve cattle care by working on small changes each year. Kesteloot has the following suggestions:

1) In mound yards, try to get rid of muddy areas right behind the bunk by extending the apron. Kesteloot sometimes advises producers to slope from the bunk down and then come back up again so the water funnels off the end of the pen rather than where the cattle walk.

"Bedding on the apron is best if it's wide enough because you can clean as needed in real wet conditions," said Kesteloot. "Sending 1,200- to 1,300-pound cattle to the same place you have an extra 5 to 10 inches of rain going off isn't a good combination."

2) Use a box scraper with a front-wheel assist tractor and bar tires to clean up mound yards.

3) Keep the manure pack just off of a narrow apron. If the bedding pack is too far away from the bunk, the cattle will be less likely to make the trip to the bunk as they get bigger.

In addition, a muddy area can develop between the bed pack and the bunks, and that just leads to problems.

"You get the wet conditions and get the bruising right after it freezes," said Kesteloot. "You can get foot rot following that in some cases."

4) If an area turns into a "big muck hole," consider dumping Hesston stacks of cornstalk bedding in the muddy areas. It's a quick fix that works well and is inexpensive.

Keeping yourself and employees comfortable will result in more comfort for the cattle.

"It's sure nice when I can work in a little bit nicer conditions," said Kesteloot. "If I'm 50 or 60 years old and it's handy to take care of the cattle, I'm going to do it. I'm a little less interested if it's not so easy, and I have to push hard."

Mound yards are less expensive to run, but can lead to less market predictability.

"Your target marketing and timing can vary - you're less predictable - with the mound yards," said Kesteloot. "You can miss the market by $20 to $30 per head because you are more vulnerable. It paralyzes your ability to make some marketing decisions when you're not quite sure when the cattle will be ready."

# Covered facilities offer market predictability that help you lock in market prices.

They are more expensive, and a few cattlemen may risk losing their facilities if they lose money on cattle just after a large investment.

Covered facilities also need to be kept full year-round. The roof facilities also minimize pollution with clean water running off the roof and away from the feedlot.

Kesteloot recommends bedding in the center of covered facility pens and scraping down to the concrete every six to nine months. The rest of the time, just clean the outer 6 to 10 feet to maintain a quality bed pack.

When he first put up covered facilities, Kesteloot was scraping the entire pen every 10 days. Now he's learned that a manure pack will work just fine. The pack is not bedded as often in the summer to keep it from getting too high, which may cause more ammonia concern.

"That bed pack is saving 60 to 70 percent of our labor time instead of cleaning and scraping the pen constantly," said Kesteloot. "On a 35- to 40-foot square pack, cattle move the manure to you so nicely as the center starts getting looser. We're learning it's a little bit of an art to manage that bed pack."

# Concrete pens work best if the farm or ranch includes a good northwest grove.

The feedlot needs to be a flat surface with good black soil.

"Give me 10 rows of trees on the north and west and put my feed yard 150 to 200 feet inside that," said Kesteloot. "There's a little more weather to deal with, but the grove is a tremendous asset to the concrete pens."

Concrete pens will not work if the feedlot is located too close to a river or a road, said Kesteloot, adding that it will cost about 30 to 40 percent less to install concrete pens versus covering the feedlot.

A north half of a pen covered with the south open offers a compromise between cost and comfort, but needs good management.

Cattlemen can often improve market predictability by going with half-covered facilities. Cattle get more outside air when it's nice out, and that leads to good health. But half of a solution still includes half of the problems. It's often hard to develop a bed pack, so more cleaning is required.

"Our cattle and our bedding were drier, but still not quite dry," said Kesteloot. "The problem is it costs the same as a fully covered building, and I still have to fight pollution. That's the real issue with a lot of facilities. They still get wet. I still push a little too much soup."

Costs and benefits

Kesteloot thinks the covered barn is often the best solution for many cattle producers. He figures the cost of an open yard is $150 to $300 per head, while the cost of a half-covered or all covered barn runs $250 to $300 per head. In an easy winter, Kesteloot achieved 7 percent better efficiency in covered facilities versus open yards.

A covered facility leaves the cattleman with something to leave for the next generation. Projections can also accurately be made based on the cost of grain. Covered facilities offer quality control, cattle performance and superior profit margins.

"I can build a building and feed 10 percent less feed year in and year out," said Kesteloot. "If I feed outside, I can wind up feeding 10 percent more feed so fast, because it's so easy to drop the ball."

By Andrea Johnson, For Lee Agri-Media

Tri-State Neighbor

The Big Ten dove into its instant replay experiment with a few goals:

Correct bad calls. Check.
Keep in-game delays to a minimum. Check.
Limit costs. Check.

With the Big Ten accomplishing its objectives, other conferences are expected to experiment with replay next season. Big Ten commissioner Jim Delany said he has discussed it with officials from more than a half-dozen conferences. "I would say the majority of the commissioners I've spoken with have real interest," he said.

To that end, the Big Ten announced Thursday it has forwarded two recommendations to the NCAA. The first requests that instant replay be permitted on a permanent basis for all Division I-A conferences. The second asks for a one-year extension on the Big Ten's replay system for 2005.

The Big Ten actually would like to make instant replay a fixture for conference games. But the NCAA could take a while to approve a permanent change, and the league doesn't want to risk falling victim to bureaucracy for the `05 season.

Delany said Big Ten coaches and athletic directors were unanimous in their approval of replay, which resulted in 21 calls being overturned in 57 games.

Instant replay added just three minutes to the average game time_from 3 hours 13 minutes to 3:16_and cost just $250,000, a fraction of what the NFL spends on its replay program.

And while the average NFL review lasts three minutes 20 seconds, according to the Big Ten, its average review lasted just 2:39.

"Football is a game of errors and reducing errors," Delany said. "Coaches and officials make them, that always has been the case. But football has so few possessions. It's not like basketball with scores and scores of possessions.

"Reviewable plays often deal with changes of possession, and to be able to get back 21 critical plays over the course of season was a real luxury."

Dave Parry, the supervisor of Big Ten officials, said the presence of replay aided his crews.

"Officials became more and more enamored of it," he said. "By the end of the year, I think all 52 officials hoped it would stay. They all want to get it right rather than find out on Sunday or Monday that a huge mistake has been made."

Parry also said replay made the officials better focused.

"Some made it a personal goal not to have replay involved one time (on their calls)," he said. "I think there was a motivational effect to make the men concentrate a little more.

"What it does is create a level of trust. We found coaches saying: `There's no reason for me to scream and holler at you fellows because they're looking at it upstairs.' They're going to get it right, so I might as well calm down and wait for the proper decision."

The only significant tweak to the system came after the Sept. 4 Central Florida-Wisconsin game, when replay officials took four minutes and 39 seconds to determine where tailback Anthony Davis had stepped out of bounds. The result was a one-yard discrepancy from the original spot.

Delany responded by telling officials to use "common sense" when determining whether to review a play.

"There has to be more gain than pain," he said at the time.

In all, play was stopped in only 28 of 57 contests (49 percent) for a total of 43 stoppages and 21 overturned calls (49 percent of stoppages).

"I thought it was a terrific cost benefit," Delany said. "Cost in terms of interruption and money."

by Teddy Greenstein

Mercury News

In 2003, Congress passed the Medicare Prescription Drug, Improvement and Modernization Act of 2003, Pub. L. 108-173, which for the first time provided a prescription drug benefit for seniors and people with disabilities. The MMA also contained provisions that would permit the importation of prescription drugs into the U.S. if the Secretary of the Department of Health and Human Services (HHS) certifies that drugs imported from Canada pose no additional risk to public health and safety and that such imports would provide significant cost savings to American consumers. The
MMA also requires the Secretary to conduct a
study on the importation of drugs. The conference
agreement for MMA included eleven issues for
consideration.

Legalizing prescription drug imports from Canada would threaten the health of Americans, provide meagre savings and create a regulatory nightmare, the Bush administration has concluded.

U.S. Surgeon-General Richard Carmona argued in a report that the risks of legalizing imports far outweigh the benefits. ''It would be extraordinarily difficult and costly for personal importation to be implemented in a way that ensures the safety and effectiveness of the imported drugs.''

The 145-page report, released yesterday by the Department of Health and Human Services, is a blow to proponents of legalizing drug imports, including many members of the U.S. Congress, who have long argued that doing so would temper soaring costs.

During the election campaign, President George W. Bush appeared to open the door to drug imports from Canada, on the condition that authorities could ensure the safety of those drugs.

But Mr. Carmona said -- in a report that largely reflects drug firms' views -- that keeping the drug chain safe would be difficult for the Food and Drug Administration.

The Bush administration has so far done little to stem a growing illegal trade that now tops $1.5-billion (U.S.) a year. The report estimates that about half of the illegal prescription drug imports now come from Canada.

Congress ordered up the report in 2003 as part of the legislation that added part prescription drug coverage to the government-funded Medicare scheme. Congress initially voted to legalize imports, but the measure was stripped from the final law in favour of more detailed study of the costs and benefits.

Among the more interesting findings in the report is Mr. Carmona's conclusion that the savings attributed to imports have been vastly exaggerated. Proponents of legalization like to cite savings of up to 80 per cent on many popular drugs.

But the report said that simply isn't true, and that the savings are exaggerated. Prices of 22 best-selling drugs -- including Zoloft, Paxil, Celebrex and Nexium -- are just 37 per cent less at Canadian-based Internet pharmacies than at competing U.S. vendors.

What's more, the report found that generic drugs are 32 per cent cheaper in the United States than in Canada.

Instead of illegally importing drugs, Carmona urged Americans to shop around for the best prices at home and always ask doctors or pharmacists for generic alternatives.

Among the report's findings:Savings would represent a small percentage of Americans' total drug costs.Importing drugs is fraught with risk, including buying bogus, dangerous and unregulated drugs.Legalizing imports would slow the development of new drugs.Washington would likely face legal and constitutional challenges from the drug industry if it sanctioned imports.Legalizing imports raises liability problems throughout the distribution chain, which could ultimately push up the cost of imports.

U.S. Department of Health and Human Services

Pharmacogenomics, the study of genetic variability in the way individuals respond to medicines, has the potential to spark a major, technology-driven restructuring of the health care and pharmaceuticals industries, according to a commentary published in the current issue of Nature Medicine by faculty of the Indiana University Program in Pharmacogenomics, Ethics, and Public Policy.

Commentary co-authors Barbara Evans, Ph.D., J.D., David Flockhart, M.D., Ph.D.,and Eric Meslin, Ph.D., see pharmacogenomics, which matches drugs to an individual's specific genetic makeup, as having major implications for the way health care will be delivered and financed in the future.

Pharmacogenomics has the potential to reduce "trial and error" in health care through tests that can identify, in advance, which patients are likely to have a good response to a particular drug therapy. The goal is to target specific drugs at specific patients, using genetic information to increase treatment successes and reduce adverse reactions.

The authors note that many of the health care industry's business norms date to an earlier era when prescribing was more an art than a science. "For example, the usual practice today is that patients and insurers must pay, even if a treatment fails to work. As well-targeted therapies become more commonplace, people may start to question that rule," said Dr. Evans, a senior scientist in the Indiana University School of Medicine's Department of Medicine. She is an economist and attorney has been heavily involved over the past twenty years in restructuring of regulated industries in the U.S., Russia, Central Asia, and the Middle East.

The authors expect pressure in coming years for health care providers and drug manufacturers to bear a larger share of the costs associated with drug-treatment failures that occur when therapies are not well targeted.

According to Dr. Evans, it has been estimated that only 60% of prescriptions written produce the desired therapeutic benefits in patients. The remaining 40% either fail to produce a positive response or occasionally harm the patient.

"In 2002, overall prescription drug spending in the U.S. was approximately $162 billion. A back-of-the-envelope calculation suggests that up to $65 billion (or 40% of this total) may have been spent on drugs that, for one reason or another, did not help the patient get well. Pharmacogenomics only addresses some of these treatment failures--those that have genetic roots. Still, the numbers are so large that even a small improvement in targeting could save billions of dollars," said Dr. Evans,

Restructuring is contentious in any industry but it presents especially tough challenges in health care, where change presents complex ethical, social, and community concerns, the authors note. Even when change is beneficial for the industry as a whole, there can be windfall gains and losses for individual stakeholders, and prospective losers may have incentives to resist. Experience in other industries shows that daunting problems of this type can be successfully resolved. According to Dr. Evans this typically requires careful dialogue among industry stakeholders and skillful regulatory policy, to ensure that the costs and benefits of change are shared in a fair way among all industry participants.

The co-authors are members of the Indiana University Center for Bioethics and its Program in Pharmacogenomics, Ethics, and Public Policy. PEPP seeks to clarify the ethical, economic, legal, and regulatory impacts of pharmacogenomics on clinical practice, research ethics, economic and industry structure, and legal and regulatory issues. Dr. Evans directs PEPP. Dr. Flockhart is a physician and pharmacogeneticist who heads the Indiana University School of Medicine's Division of Clinical Pharmacology and whose current research and clinical trials activities focus on breast cancer. Dr. Meslin is director of the Indiana University Center for Bioethics and previously served as Executive Director of the National Bioethics Advisory Commission.

Contact: Cindy Fox Aisen, caisen@iupui.edu, 317-274-7722

Nucleus Research, a global provider of return on investment (ROI)-focused research and advisory services, and TechTarget's CIO Decisions, a new monthly magazine focused on helping midmarket CIOs align information technology (IT) with business goals, today announced a call for submissions for the third annual Technology ROI Awards. The awards honor end-user companies whose deployments of specific IT systems have achieved positive bottom-line financial and business results. Past winners include Los Alamos National Laboratory using NetPro, Harrah's Entertainment using Teradata, Halliburton Energy Services Group using Plumtree and the Seattle Public Schools using SAP.

US-based organizations with revenues of at least $50 million are invited to nominate IT projects that have achieved measurable ROI. Eligible projects must have been installed and in operation no later than Jan. 1, 2004. A nomination form and more information about requirements for the Technology ROI Awards can be found at www.roiawards.com.

The deadline for submissions is March 1, 2005. Winners will be honored during a special awards program hosted by Nucleus Research and CIO Decisions at the CIO Decisions Conference, July 26-28 in Pebble Beach, Calif.

Ten Winners and One Grand Prize Winner to Be Chosen

A panel of independent judges will select 10 winners and one grand prize winner based on Nucleus Research's standard methodology for measuring the ROI of IT deployments. Built on the results of thousands of ROI assessments worldwide, the methodology verifies the costs and benefits of each project and creates a metric representing the project's overall ROI. Nucleus Research is the only research firm registered with the National Association of State Boards of Accountancy (NASBA) to provide training classes to Certified Public Accountants on assessing the ROI from technology.

"Nucleus Research's methodology enables CIOs to demonstrate to their business colleagues a clear link between technology implementations and bottom-line business benefits," said CIO Decisions Editor-in-Chief Maryfran Johnson.

Nucleus Research is a global consulting and advisory company that provides CFOs, CIOs and their staffs with the real-world information they need to maximize the business returns from their technology investments. Its analysts blend financial analysis and case-based investigations with comprehensive technology expertise to deliver factual return-on-investment (ROI) data to organizations worldwide. The company uses an uncompromising set of processes and tools to evaluate the financial return on IT assets and is the only firm to gain certification by the National Association of State Boards of Accountancy. Nucleus Research has analyst experts across the entire enterprise software and hardware space and provides clients with ongoing advice to help with both short-term technology decisions and long-term strategic plans. For more information, visit www.nucleusresearch.com

After months of waiting, local agencies and city employees only have a few more days before they find out if they'll have a blue Christmas.

At Monday's City Council meeting, Mayor James Perkins Jr. distributed the latest draft of his proposal for the 2004-2005 fiscal year budget and it includes a proposed $420,381.52 cuts from the first draft.

There are proposals for shutting down Fire Station #1, cutting funding to the library, consolidating departments, re-working retiree health benefits as well as renegotiating with the county on several projects.

The proposal outlines 15 different projects that would save the city money, some of which require an initial investment and mute the cost-cutting effectiveness of the project in year one of the budget but will pay greater dividends down the line.

In the end, the number most Selmians may be interested in is the bottom line.

According to the document entitled Proposed Budget Draft #3, the latest proposal will carve roughly $420,000 for the budget for a proposed General Fund and Capital balance of $16,131,451.66 . The city's budgeted revenue for the year, according to the proposal, is $16,362,699.08, meaning Selma would have to make up the deficit of $231,247.43.

While the current proposal shows a deficit, the Council still has to approve it. The Council may require modifications that reduce or eliminate the deficit.

Merger of Fire Station #1

Located at 20 Franklin Street, Fire Station #1 is a historic building. It is the oldest firehouse in the city, complete with brass sliding poles. However, Fire Station #1's service area is duplicated by #2 and #3.

Perkins and Fire Chief Henry Allen, propose that #1 become an historic firehouse, completely inactive. By repositioning the nine firefighters and adding six more that are currently training in Ozark, the city would be fully staffed, cutting overtime. According to the proposal, the city's fire rating would not change. Concern has been expressed in the event a train were to delay firefighters from getting to a fire downtown.
Fire Station #2 is on the same side of the tracks as #1.

The proposal suggests that by fully staffing four stations instead of partially staffing five, the city can cut overtime. In the 12 months, overtime cost the city nearly $100,000. The proposal recommends the city keep $25,000 budgeted for overtime. In addition, the city will not fill three slots temporarily cut last year and cut an additional three slots. The six slots represent $173,520 in savings for the city.

According to the proposal, the city spends about $327,330 on routine vehicle maintenance. The average hourly rate charged by a mechanic is $45-$55. The average service time is two hours per repair.

Perkins' proposal suggests the city should operate an in-house vehicle repair shop to perform routine and small maintenance jobs at the General Services Department.

The current proposal would have four employees in the facility for a total of $93,000 in salaries annually and $27,900 in benefits. It's estimated that the city would save $175,497.50 in maintenance of vehicles from the police, fire, general services, cemetery, public works, landfill and recreation. That includes $70,000 for materials. The city would also have to initially buy tools, lifts and a computer system at a total one-time cost of $46,250.

In total, the proposal estimates the city could save more than $8,000 this year, but that number would grow in future budget years.

The library has probably gotten the most attention of any agency facing cuts. The mayor publicly complained about the unequal spending between the city and the county on the library, even citing meeting minutes from the mid-1980's in which the relationship was discussed.

County Probate Judge John Jones pointed out, however, that the county shares a heavier burden in other areas than the city. He also said the county is not responsible for what the city has agreed to pay.

Recognizing the county's position, the current proposal explains the current ways in which the city gives to the library and outlines cuts that will total $42,000 this year and $84,000 annually after that.

Currently, the library receives $245,000 from the city's General Fund, a one-cent (.01) tobacco sales tax and the monthly payment of utility bills.

The proposal goes on to further claim that since the cigarette tax was given to the library, it has been incorrectly paid out. Because the tax was not percentage-based, it should have remained constant, even as the percentage of tax levied on cigarettes rose.

"When the cigarette tax was set at five cents, the one-cent allocation for the school system and the library equaled 20 percent," the proposal states. "As the cigarette tax increased, the percentage of that tax should have decreased. Instead, it remained the same."

The proposal also outlines pay raises within the library, including a 43 percent increase over the last four years for the director's salary.

The proposal states that for the last nine years, the library has had a management position, left unfilled, with a salary of $30,000.

The city's first proposed solution is that the county takes a larger responsibility in the library, but adds other proposals recognizing the county's position.

The proposal recommends the library pursue more grant funds and donations from the community.

The proposal also recommends that the city rescind Ordinance 279 and restructure the board of trustees of the library in a way that makes city and county representation more reflective of their contributions.

"It is further recommended that the library discontinue the rapid escalation of the library personnel salaries and look within its budget for ways to reduce costs without reducing services," the proposal states.

Animal Control of Selma

Another area of contention between the city and county is the Central Alabama Animal Shelter housed in a building purchased by the city.

The city has spent about $400,000 in getting it ready to open. The city expected help from the county, but the county has said they will not contribute.

Essentially, the proposed solution is the city maintain and operate the shelter under the name Animal Control of Selma.

"The city should no longer anticipate financial support for the shelter from the county," the proposal states. "However, if the county desires to use the city's shelter then a fee per animal will be negotiated."

The proposal outlines a plan in which the city assumes control, cuts the animal control staff by one and splits another into half animal control, half shelter support.

The city estimates this will create $53,106 in savings.

E-911

After originally agreeing to house E-911 in the Wilson Building (owned by the city), the city and county hammered out an agreement in which the city would hire employees and bear the costs of running E-911 and dispatch calls to different agencies. The county and the sheriff's department then reimbursed the city for some of the costs.

After the City of Selma and the E-911 Board (appointed by the county) agreed to pay for foundation work on the Wilson Building, the board voted to move the E-911 dispatch without the city's consent.

The city is currently under a contract to provide E-911 services. The city claims it reimburses the county 48.04 percent of money spent on salaries, benefits and overtime, not to exceed $226,000. The city also pays a third of utilities and maintenance.

The city asks to appoint an equal number to the E-911 board because of the equal funding.

City/County Jail

In 1999, the city agreed to operate a joint city/county jail. The city pays the county $200,000 annually for rent and is not responsible for expenses related to operation of the jail, but is responsible for bills and charges for medical treatment at an outside medical facility.

A supplemental agreement, also reach in 1999, limits the City of Selma to the use of 16 bed spaces in the county jail.

The proposal recommends the city renegotiate the contract to cut the payment to $100,000.

Recreation

The city's free recreation league baseball is played in two facilities, the county owned Sportsplex and a city owned complex.

The Sportsplex is built with smaller fields for younger teams and the complex hosts the older children, as well as some fall soccer.

With far more children playing baseball and softball at younger ages, most of the games are played at the Sportsplex, meaning most of the revenue raised by concession salesXXXXXXXXXXX is at the Sportsplex.

The city paid $12,759 last year for laborers at the Sportsplex.

"It is recommended that the City of Selma enter into a Sportsplex management agreement with the county," the proposal states. "It is recommended that the Sportsplex and the complex be equally booked for games."

The proposal states that while researching cost-cutting opportunities in recreation, city officials "discovered" that the county was paying city employees as well.

Director Elton Reese received $26,000 from the county while Dianne Russell was paid $5,000. The city recommends that all direct employee/employer relationships between city employees and the county be eliminated.

Re-engineering Tourism Strategy

The city currently pays $327,000 for tourism from the General Fund and tourism account, and it gives $84,000 to local museums, the EDA and the Downtown Association.

The proposed cut involves moving $84,000 from the General Fund to the tourism budget, creating a savings in the General Fund, according to the documents.

The proposal recommends the Centre of Commerce manage the tourism fund by entering into a contract with the city earmarking the annual appropriation.

"We believe existing functions performed by the Centre of Commerce are imbedded and duplicated in tourism," the report states. "By consolidating these functions, the city could realize a projected savings of $85,000.

Combine Code Enforcement and Historic Monitor

The city currently spends $19,002 for the Historic District Compliance Monitor to keep watch on homes in the Historic District to make sure they meet required standards.

However, the Historic Monitor has no enforcement powers and must contact the Code Enforcement Officer or another person with enforcement powers to deal with the problem.

Minus training for the Code Enforcement Officer, elimination of the position would save the city about $17,000.

Combine Finance and Tax and License

The Finance and Tax and License Department currently operate under two managers and the departments have 14 employees combined.

The plan is to combine the two departments into three divisions, tax and license, accounts receivable and general accounting.

By combining the departments, one and a half positions can be eliminated.It is recommended, however, that a revenue collection officer position be created to go after unpaid debts. The proposal states there is no way to estimate the impact of such a position accurately, but there is $80,000 in uncollected revenue related to condemned property alone.

Consolidation of Public Works

According to the report, multiple departments within the city provide similar services: Public Works, General Services, Cemetery, Recreation and Inert Landfill.

"The departments individually and sometimes collectively provide routine services of the same type," the proposal states. "This method of delivering services is ineffective and very costly."

A team of city employees worked together to draft a cost benefit analysis to consolidate the department of Public Works to cover solid waste, beautification, street maintenance, tree cutting, fleet maintenance and inert landfill.

An engineer would be hired to run the department, divided into a department for each of the duties. By consolidating the departments, the proposal estimates the number of employees could be cut from 102 to 78, saving $433,925.

The consolidation effort would create $68,485 in savings for the city, not including the benefits already mentioned in fleet maintenance and curbside pick-up (see below).

Garbage collection

The proposal also recommends changing trash pickup from backdoor to curbside, generating an additional $141,920 from commercial customers. In addition, the city will generate one-time only revenue of $140,000 by selling seven garbage trucks that will no longer be needed.

There will be some initial costs in switching the garbage pickup, including the purchase of arm-reach trucks, dumpsters, overhead trucks and containers. The equipment would cost about $201,000 and would be spread over a five-year period.

The equipment would allow the city to reduce manpower by 19 employees.

"The city should retain its present competitive pricing for commercial pick-up, develop a dumpster size standard and aggressively re-enter this market," the proposal states.

Planning and Development

The most intricate and developed of the proposals, the restructuring of Planning and Development takes up seven pages of the 34 page report.

The Planning and Development Office has the responsibility of acquiring and managing grants, managing historic properties and coordinating municipal events.

The proposal evaluates the grant performance of the department and states it is coming up short.

"The most recent year shows a major decline in grant funding," it states. "It is believed this is due to an unwillingness to change directions and pursue non-traditional grants that we are not accustomed to pursuing."

Though the report admits the department has been "marginally successful" in making capital improvements, maintaining historic properties and making infrastructure improvements, it says increases must be made in those areas as well.

The department should implement more citizen participation with town hall meetings, surveys and neighborhood associations, according to the report.

The proposed strategy also suggests creation of a compliance manager position responsible for matching grants with grant writers and coordinating process and details.

"The mayor has the responsibility and authority to restructure the Planning and Development Department," the proposal states. "The budget appropriations to support the department are the responsibility of the council."

The new Planning and Development Department is laid out position by position with projected costs in the proposal.

It is estimate the new department will cost the city nearly $60,000 more than previously, but the city would be banking on better grant performance to offset the cost.

Retiree Health Insurance

Currently, the City of Selma has about 44 retired employees enrolled in Blue Cross Blue Shield, for which the city pays full cost.

Currently, employees with 25 years of service or 20 years of service at the age of 62 are entitled to continue their healthcare coverage until they reach 65, when they become eligible for Medicare.

At age 65, the employee is enrolled in a Medicare supplement program through Blue Cross Blue Shield of which the city pays half.

The project offers three solutions, the last of which is recommended.

The first is to discontinue all healthcare benefits to retirees. That would save over $150,000 a year and leave retirees with the option of buying COBRA coverage in which they adopt the full cost.

The second recommends ending the Medicare supplement program and cutting the Blue Cross Blue Shield coverage in half for retirees, meaning the city would still pay for half of the coverage.

This proposal would save the city about $90,000.

Finally, the third plan recommends cutting the Blue Cross coverage in half and keeping the Medicare supplement plan. The retirees would pay half the cost and the city would pay half.

"By adopting this proposal, the city would still comply with the spirit of the original resolution," it states.

The final proposal would save the city about $62,000.

By John Gullion
Times-Journal News Editor

Robert W. Hahn. Conference on "The Cashless Society: Revolution or Evolution?" Event Proceeding 04-27. Dec 2004.

Taken together, calculations suggest that the move to a cashless society is probably beneficial

Table Private and Social Marginal Costs for Grocery Transactions
Calculated at the Average Grocery Cash Transaction Size of $11.50 ($)

Cash Check Credit Signature PIN
Non- Verified Charge Debt Debit
Verified

Merchants 0.30 0.42 0.44 0.61 0.68 0.57
Consumers 0.65 0.70 0.65 0.46 0.46 0.55
Central Bank 0.004 0.03 0.03 0 0 0
Commercial Banks 0.07 0.12 0.12 0.32 0.28 0.28
Sum of Marginal Costs 1.02 1.27 1.24 1.39 1.42 1.40
Social Marginal Cost 1.01 1.18 1.05 0.96 0.92 1.00

Oversight Systems Inc. today announced the results of the 2004 Oversight Systems Financial Executive Report On Sarbanes-Oxley Compliance, a nationwide survey of 222 financial executives. The report shows most financial executives are torn on the cost vs. benefits of Sarbanes-Oxley compliance.

The findings reveal that a majority of financial executives (57 percent) say Sarbanes-Oxley (SOX) compliance was a good investment for stockholders. However, when asked about the impact of SOX compliance on shareholder value the view was mixed. Although a clear majority (81 percent) think Congress needs to revisit SOX legislation, most would still include the sections that require the CEO and CFO to sign off on financial reports (Section 302); increased documentation and monitoring of internal controls (Section 404); and the timely disclosure of material changes (Section 409). More information about the survey, including downloadable findings, can be found at http://www.oversightsystems.com/newspress/survey.pdf.

Of those surveyed, 79 percent report having stronger internal controls as a result of SOX compliance. Nearly three quarters (74 percent) say their companies realized a benefit from SOX compliance. When asked to identify the benefits from SOX, the survey reports that:

Contact: Brian Moran, 404-920-2039, www.oversightsystems.com
brian.moran@oversightsystems.com,

MAINE VOICES: Douglas Muir
Douglas Muir of Kittery (e-mail: dwmuir@mailaps.org) is a retired federal employee who worked for over 30 years in the field of statistical analysis of scientific data. He is a leader of No Slots for ME!

In a column entitled, "Bangor slot machines will benefit that city and all of Maine" (Oct. 31), Bangor Mayor Daniel J. Tremble wrote that the project to build a racetrack casino in Bangor "represents an enormous economic development opportunity, both for our city and the state of Maine as a whole."

He went on to say "We expect that 400 to 500 new jobs will be created."

I have to disagree on both counts. The Bangor casino will have a visibly negative effect on both jobs and the economy.

The mayor's optimism may be based on the March 2003 study prepared by Prof. Jonathan Rubin and his colleagues at the University of Maine. That study was paid for by a firm with an interest in the racino at the time.

Reporter Dawn Gagnon, writing in the Bangor Daily News on May 23, 2003, stated that the Rubin study "was commissioned by Capital Seven LLC, owned by Nevada businessman Shawn Scott. A spokesman for Capital Seven said the study cost about $20,000."

A shortcoming of the Rubin study is the fact that a number of major negative impacts are simply omitted. According to the study, ". . . issues that are not addressed in the report include, among other things, the effects of a racino on the local labor market, added demand for public services and the potential social costs associated with crime and compulsive gambling. Further, the study does not assess the effect of the racino on existing state lottery revenues."

Especially important is the omission of the financial costs associated with compulsive gambling. Probably the world's leading independent expert on casino economics is Professor Earl Grinols of the University of Illinois Department of Economics.

In his recent book "Gambling in America: Costs and Benefits," published by Cambridge University Press, Grinols writes, "The costs of pathological and problem gambling are comparable to the lost output of an additional recession in the economy every four years."

So much for the "enormous economic development opportunity" of a racino.

The Rubin study does address the important question of whether or not the projected casino revenues can be considered as "new" money available for truly new job creation.

The short answer is "no." According to the authors, "A recent survey of in-state gamblers at Missouri casinos found that 64 percent of the gamblers' casino expenditures represented reduced spending that otherwise would have been made at other businesses within the state."

Because of Bangor's location, the cannibalizing of revenues from in-state business will likely be higher than in Missouri. We can safely conclude that an increase of $75 million per year in gambling revenues in Bangor will reduce revenues by at least $48 million per year in other Maine businesses.

It is crucial to consider the jobs impact of this lost revenue. A useful fact, also taken from the Rubin study, is that in 2000 the Bangor economy overall generated $3 billion in total sales and supported nearly 45,000 jobs.

In other words, in that year each $1 million in sales supported, on average, 15 jobs. Based on this figure, the loss of $48 million in revenues will result in the loss of 720 jobs in the market area of the casino.

And how many jobs will be gained? Again quoting the Rubin study, "The developers of the proposed casino estimate that the combined operations of the racetrack and casino will generate annual gross revenues of $75.3 million, employ 314 people, and pay $5.3 million in wages and salaries."

At least 720 present jobs will be eliminated by the impact of the casino, and only 314 jobs will be created. The operation of the casino in Bangor will result in a net loss of over 400 jobs!

By the developers' own figures, the casino will produce only 4.2 jobs per million dollars of sales, as compared with the Bangor-area average figure of 15 jobs per million dollars of sales.

The difference between these two figures arises from the fact that slot machine gambling is highly automated activity. The primary "service," if you want to call it that, is provided by a mechanical device, not a human employee.

In addition to a host of other negative impacts, a Bangor casino would bring a weakened economy and a net loss of jobs to the state. Our elected officials should carefully consider whether or not they really want to bet their futures on this tired horse.

Harry J. Skefos, who represents companies seeking PILOT incentives to locate or expand here, says the programs are especially necessary in Shelby County because of its high taxes compared with competing locations, and the high cost of training and keeping a workforce in the

According to Skefos The Payment in Lieu of Tax (PILOT) programs in Shelby County have been, and continue to be, essential for growing our local economy.

Programs that reduce, for a specified time, the property tax burden on new or expanding industry are a necessary incentive for two reasons: When compared with competing locations, Shelby County's taxes are simply too high; and the costs of training and keeping a workforce here compare unfavorably with other locations.

While the PILOT incentives are an essential tool of economic development, local government must also assure that such programs work as intended -- that applicants meet their obligations and that forgoing the taxes generates the intended benefits.

Job creation alone can be viewed as an adequate reason for such incentives, but Shelby County government has always held its PILOT program to a much higher standard.

Each application processed by the Memphis and Shelby County Industrial Development Board (IDB), the body that has awarded the vast majority of PILOT incentives here, includes computation of the cost/benefit ratio. (The application process used by other entities that award PILOT incentives may differ.)

The IDB's cost/benefit analysis amounts to a very conservative measure of how the amount of property tax that would be waived for a given project compares with the combination of the tax revenue that would be generated by new workers hired and the one-time payment of taxes associated with construction of the PILOT project.

Historically, PILOT projects that are approved have scored a cost/benefit ratio of .40:1.00 on average, which means that for every 40 cents of property taxes forgone, $1 in new tax revenues is generated for each year of the PILOT term.

The cost/benefit analysis is very conservative, as it doesn't take into account other tax revenues that usually result if a PILOT project materializes, such as: taxes paid on property not sheltered by the PILOT incentives; Tennessee franchise and excise taxes; taxes paid on property sheltered by the PILOT incentive after the PILOT lease term expires, and taxes generated from pre-existing jobs that a participating company is required to maintain.

Clearly, looking at tax collections alone, the PILOT program has been a real success for our community -- a conclusion that is only buttressed when one considers the tremendous job creation it has also enabled.

It is important to note that even when covered by a PILOT incentive, the applicant pays significant fees to the IDB to participate in the program, as well as a payment in lieu of tax each year that is equal to about 30 percent of what its county taxes would otherwise be.

The IDB's PILOT lease spells out each party's responsibilities and clearly protects the public's interest. It contains provisions that enable the IDB to monitor a participating company's performance; in cases where performance does not meet initial projections, the lease authorizes the IDB to reduce the PILOT incentive to the level earned by actual performance.

Recent changes now require a company participating in the PILOT program to reach and maintain 100 percent of its projected levels for job creation, wages and capital investment within two years of initiating its project. Failure to attain any of these goals by even the smallest amount will render a project in default.

Given these strict requirements and the realities of economic and business cycles, it is not surprising that some projects default on their IDB requirements. This year, out of more than 200 projects being monitored by the board, 30 were initially thought to be in default. After further review by the IDB's performance review committee, only 17 were determined to be in default. Of those, the IDB found that four cases did not warrant any reduction in PILOT incentives. The PILOT terms for 11 projects were reduced to bring the participating companies' incentives in line with actual performance. The remaining two cases are still under review.

During the past year, further attempts to restrict the PILOT program have been considered. They include a proposal to restrict PILOT incentives to projects that produce jobs paying wages above a certain minimum, without crediting the significant fringe benefits that may accompany a relatively modest base wage.

The problem with that approach is twofold. The application process already takes into account a company's pay scale, and those projects that offer lower-paying jobs will receive a smaller incentive. Also, our citizens often need these lower paying jobs -- which typically are entry level, lower skilled positions. Denying a PILOT incentive to companies that cannot meet a specified minimum wage will inevitably reduce the availability of such jobs.

More recently it has been suggested that companies should pay some "penalty" if they stop operating or move their operation out of Shelby County shortly after their PILOT terms expire to avoid a net loss of tax revenue.

The trouble with this approach is that its basis is false: On average, PILOT projects have resulted in much more tax revenue being generated for our community each year of the PILOT term than is lost or forgone.

Such a penalty provision would cause us to lose good projects when companies are not willing to accept such an obligation.

The only way such an approach would be fair would be for local government to revamp its cost/benefit calculations to take into account all of the tax benefits that flow from a PILOT project, and then to apply the penalty only to projects where the cost to the community exceeded the benefit.

In such cases the penalty would phase out over time as the company is credited with tax payments made following the PILOT term.

It is doubtful that more than 2 percent of the projects would fall into this category; hence, the negative impact of such a change would seem to outweigh any possible revenue gain for local government, although it might be a popular move for politicians who would prefer to shift the blame for our current revenue crisis.

The problem in Shelby County is not a lack of tax dollars, but rather that local government has for too long been spending monies that were not available, except through borrowing.

In 1997, property tax collections in Memphis and Shelby County totaled $485,543,620. By 2003, that amount had grown to $941,424,076, a 94 percent increase in only six years. (And the 2003 figure does not include tax collections from new construction, Memphis's annexation of parts of southeast Shelby County and revenues from the Central Business Improvement District and the PILOT programs.)

High taxes will encourage people and businesses to leave Shelby County, causing property values -- our tax base -- to fall and leaving fewer of us here to provide the same level of tax revenues for local government by paying an ever-increasing tax rate.

The only way to reverse this negative spiral is to limit increases in government spending, to pay off local government debt, and to begin to lower tax rates so that economic development is spurred on -- even without consideration of a PILOT incentive.

In the meantime, the PILOT programs in Shelby County provide an essential economic development tool that can keep economic development moving forward until local government can get its fiscal house in order.

--------------------
Harry J. Skefos is an attorney with Martin, Tate, Morrow & Marston, P.C., in Memphis who represents companies applying for PILOT incentives.

IF the Hewitt Associates' 'Best Employers of India 2004' is anything to go by, it really pays to be better employer.

Hewitt Associates' analysis of the financial performance of the 'Best Employers' since 2000-01 clearly suggests that they outrun their peers in generating higher return on assets and capital employed and consistently improving the efficiency with which they generate turnover, while also delivering superior returns to investors.

More importantly, the scale on which the 'Best Employers' are outperforming the industry average has been consistently going up over the last four years.

The analysis examines key business measures such as the strength of balance sheet of companies, their operating performance and price- to-earnings ratio. Individual company measures were, subsequently, divided by the matched industry figure to calculate the ratio between company and industry performance. The results clearly show that the 'Best Employers' outperform the industry on key metrics.

For instance, with respect to the return on total assets - which measures how well a company has been utilising assets to generate profits - the 'Best Employers' have consistently outperformed their industry peers and the gap, except for a slight dip in 2002-03, has been widening over the last four years.

A similar trend is seen in case of the return on capital employed, which measures the utilisation of invested funds. In terms of operating margins - which measures efficiency in operations - the 'Best Employers' performance has steadily risen from below industry average in 2000-01 to significantly above the average in 2003-04.

On the price-to-earnings ratio - which measures the faith reposed by investors on the company's ability to create shareholder value - the 'Best Employers' have maintained better performance than the industry average.

According to Hewitt Associates' Head India Consulting, Ms Smita Anand, the results are not surprising. The 'Best Employers' have highly engaged workforce, significantly lower attrition and superior people practices. They, therefore, have the right people working to their potential, in an enabling environment with the right leaders.

The 'Best Employers' receive nearly 66 per cent more applications, have a 35 per cent less overall attrition level and invest nearly 2.5 times as many hours in each employee's training.

"The trend in India is in sync with the findings of global research by Hewitt Associates on 'Best Employers' in other countries including China," Hewitt's Managing Director, Asia-Pacific operations, Mr Mick Bennett, told Business Line.

However, what is striking in India is the level of public sector participation in the survey, which is growing every year.

In comparison, in other countries of the region a beginning is just being made, Mr Bennett said. Hewitt's Head of Leadership and Talent - Asia Pacific, Mr Andrew Bell, hoped that the trend of best employers outperforming their peers on financials could only become more pronounced over the years.

Anil Sasi
Businessline. Chennai: Dec 11, 2004. pg. 1
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(Copyright 2004. Financial Times Information Limited - Asia AfricaIntelligence Wire. All Material Subject to Copyright.)

According to a recent U.K. study by the "U.K. Beam Trial Team" spinal manipulation is a cost effective addition to "best care" for back pain in general practice. Manipulation alone probably gives better value for money than manipulation followed by exercise.

Over one year, mean treatment costs relative to "best care" were £195 ($360; {euro}279; 95% credibility interval £85 to £308) for manipulation, £140 (£3 to £278) for exercise, and £125 (£21 to £228) for combined treatment. All three active treatments increased participants' average QALYs compared with best care alone. Each extra QALY that combined treatment yielded relative to best care cost £3800; in economic terms it had an "incremental cost effectiveness ratio" of £3800. Manipulation alone had a ratio of £8700 relative to combined treatment. If the NHS was prepared to pay at least £10 000 for each extra QALY (lower than previous recommendations in the United Kingdom), manipulation alone would probably be the best strategy. If manipulation was not available, exercise would have an incremental cost effectiveness ratio of £8300 relative to best care.

All groups improved over time. Exercise improved mean disability questionnaire scores at three months by 1.4 (95% confidence interval 0.6 to 2.1) more than "best care." For manipulation the additional improvement was 1.6 (0.8 to 2.3) at three months and 1.0 (0.2 to 1.8) at 12 months. For manipulation followed by exercise the additional improvement was 1.9 (1.2 to 2.6) at three months and 1.3 (0.5 to 2.1) at 12 months. No significant differences in outcome occurred between manipulation in NHS premises and in private premises. No serious adverse events occurred.

The study used a stochastic cost utility analysis alongside pragmatic randomised trial with factorial design. It was conducted over 181 general practices and 63 community settings for physical treatments around 14 centres across the United Kingdom with 1,287 participants (96%) of 1334 trial participants.

This paper revisits the issue of whether to include maintenance costs in an economic evaluation in mental health. The source of these maintenance costs may be public or private transfers. The issue is discussed in terms of a formal cost-benefit criterion. It is shown that, when transfers have productivity effects, income distribution is important, and one recognizes that public transfers have tax implications, transfer can have real resource effects and cannot by ignored. The criterion is then applied to an evaluation of three case management programs in California that sought to reduce the intensive hospitalization of the severely mentally ill.

by Robert J Brent. Health Economics. Nov 2004.Vol.13, Iss. 11; pg. 1125
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Morning Edition, December 8, 2004 · A new program gives first-time single, poor mothers guidance from trained nurses. The nurses supervise the pregnancy and the first two years of the baby's life. According to the journal Pediatrics, the program is cheaper and more effective than any other early intervention plan. Hear NPR's Michelle Trudeau.

Medicare is designed to cover health costs for all Americans 65 and older. But a new study shows the obesity epidemic in this country may end up breaking the Medicare system.

A study in the Journal of the American Medical Association tracked 15,000 people from 1967 through 2002. It found Medicare spent 80-percent more money on overweight people, compared to those who were normal weight. And the heavier the person was the more health care dollars they required.
Experts say in 40 years, the number of people on Medicare will nearly double and the majority of them will be overweight. So doctors say the study shows something needs to be done before the health insurance ind
ustry cracks under the hefty costs of obesity.

A study by the Department of Trade and Industry (DTI) showed that the benefits from the incentives granted to both foreign and local investors over a seven-year period outweigh the revenues foregone by the government.

To allay the fears of the Department of Finance (DOF) about the alleged increase in revenues forgone by the government as a result of fiscal incentives extended to investors, the DTI through the Board of Investments (BOI) studied the cost of incentives vis-à-vis net benefits of registered-enterprises.

The study covered, however, only 735 companies that have registered 1,056 projects worth P663 billion from 1995 to 2001 or an average of P95 billion per year over seven years. There are more than 6,000 investment projects that have registered with the BOI since 1987.

Based on annual investments of P95 billion, the difference between the revenues foregone by the government and the revenues generated from these investments amount to P7.62 billion. This after total revenues foregone by the government amounted to P9.4 billion while revenues generated during and after the incentive period or 15 years amounted to P17.02 billion.
For every peso worth of incentive granted, a total of P10.08 worth of investments had been registered with the BOI. Furthermore, for every peso worth of incentive extended by the government would generate P1.54 worth of revenues in 15 years or during and after incentive period.

The revenues generated on the first seven years from BOI-registered companies come from local taxes, license fees, and withholding taxes from employees. Revenues after the incentive period come from income tax holiday, as well as other forms of taxes. Furthermore, the investments resulted in $5.44 billion worth of export earnings at the same time generated employment for 34,000 direct workers.

“With this actual cost-benefit analysis, the issue therefore on whether fiscal incentives are revenue foregone is now rendered moot and academic,” the BOI study stated. The study further stated that fiscal incentives incur costs “but it is too simplistic to conclude that all these costs are in the form of foregone revenue.” “Foregone revenues may be variable costs arising from fiscal incentives in the same that even if granted, if no investment occurs, no revenue foregone can arise in the first place,” the study added.The BOI earlier said the Philippines could not stop providing incentives as the country competes for capital in a region. Thailand, Malaysia, Indonesia, and China offer very generous incentives notwithstanding their world-class infrastructure.

The DTI and the DOF are debating on the proposed rationalization of fiscal incentives through changes in Executive Order 226 otherwise known as the Omnibus Investments Code of 1987, as well as the repeal of other incentives law to have a simplified, consistent, and stable administration of investment incentives policies of all promotion agencies.

by Lawrence Agcaoli

Call it a consciousness-raising session on counterfeiting, not of money but of products.


Officials at all levels of government have been driving home the point that counterfeits show up across the marketplace at a staggering cost to legitimate companies and taxpayers, and in some cases even raise a hazard for consumers.


Last month the New York City comptroller's office weighed in. It issued a report estimating counterfeiting cost the city and state $2.6 billion in tax revenue last year -- about $1 billion of that amount lost to the city alone. The tax-dollar drain, the report says, "significantly affects the city's ability to deliver essential services."


In the fiscal year that ended Sept. 30, counterfeit goods valued at $138 million were seized at the country's borders, according to Daniel Baldwin, an acting assistant commissioner in U.S. Customs and Border Protection, a bureau of the Department of Homeland Security. While it tries to keep counterfeit goods from entering the country, Baldwin says, "our priority mission is to stop terrorism." So the bureau has added incentive, he says, to work more with industry and international law enforcement agencies to curb counterfeiters.


Brian Monks doesn't have to be told the impact of counterfeiting. He has been fighting it since 1996 when Northbrook, Ill.-based Underwriters Laboratories started a formal program to work with law enforcement officials to protect the "UL" seal, which shows products meet UL standards.


One check by staff, for example, led to a UL warning last January about an unspecified number of lamps sold nationally at Big Lots stores. The lamps bore counterfeit UL holographic labels, the warning said, and posed a possible shock hazard.


The U.S. Food and Drug Administration calls counterfeiting of medications "particularly insidious." An FDA report last February says the counterfeits "may closely resemble legitimate drugs yet may contain only inactive ingredients, incorrect ingredients, improper dosages, sub-potent or super-potent ingredients, or be contaminated." The FDA says the problem in the domestic drug supply is growing. Counterfeit investigations by the FDA ranged from four to six in each year from 1997 to 2000; they have numbered at least 20 annually from 2001 to 2003. To help combat counterfeiting, the FDA last month issued guidelines to encourage the industry to voluntarily expand research and use of technology called radio frequency identification. The day the FDA made its announcement, Pfizer said it would start shipping Viagra with the tags by the end of next year. Viagra was chosen because it is one of the most widely counterfeited drugs.




by Henry Gilgoff

From the moment early man first successfully rolled a rock in front of his cave to keep out the cold, do-it-yourself projects have both enthralled and humbled us.


The premise is enticing. For the price of the materials alone you can have that new floor, tiled kitchen or luxe bathroom. Books, videos and television all contribute to the myth of the happy homeowner who spends a few hours tiling away in his new addition. His project looks picture perfect. It isn't much of a leap to imagine yourself doing the same.


The truth is that it can take a lifetime for a do-it-yourselfer to master home improvement skills such as plumbing, bricklaying or cabinet-making. And as anyone will tell you after emerging broken and bleeding from a particularly messy project that has taken twice as long as was planned, cost two or three times what was budgeted and looked only half as good as was dreamed: The learning curve is steep for many projects, and in order to achieve the best result you have to know when to hire a professional.


You should ask yourself a few more questions that you won't find listed with the instructions for your project.


First, you need to place a value on learning that specific skill. How often will you use the skill or similar ones? Even though it can take time to learn well, a skill such as laying tile could come into play many times in home renovations and repairs -- bath, kitchen, counters, back splash, entryway or basement. A professional tile setter will charge about $4 and up to set each square foot of tile. Depending on the choice of tile, the setting fee can be much as the tile, doubling the cost of the project. If time isn't too important, learning how to do it yourself may be a good alternative because you will be able to use your skill elsewhere in your house.


Unlike tile setting, painting is a relatively simple job that many people try at least once.


Professionals point out that some job estimates, even for such seemingly simple projects as interior painting, are for full service. The extra cost is for all the care taken to provide an experience that will completely relieve the homeowner of the chore at hand. For example, LeGrand moves out all the furniture from the rooms he paints, places drop cloths over the floors and repairs any irregularities in the walls and ceiling. When he finishes, he vacuums and leaves the room in top shape.


For the more adventurous, another frequently used skill is basic plumbing. Because this skill is frequently needed and fairly easily mastered, the time invested usually pays for itself with the first repair. Home improvement stores occasionally run free classes on the basics and these same skills are nearly always included in home repair books. It is generally agreed upon by even the most enthusiastic do-it-yourselfers that serious plumbing issues are best left to professionals.


All things being equal, a simple cost-benefit analysis can be helpful. Many homeowners use some variation of the following: First take your hourly take-home wage and multiply it by the hours you think it will take you to learn how to do the project and to complete it. Add on any costs for supplies that the contractor may have provided in his estimate, such as dropcloths and brushes used during painting projects. Add on the cost of any time for work you might miss at your regular job. The total is your do-it-yourself cost.


Compare that with the professional estimate, minus an "aggravation fee." This fee is the amount that you would be willing to pay to make the work go away. For some people, this figure will be small. The money saved and the personal satisfaction from doing it themselves will make the project seem like a bargain. For those who hate plumbing, painting or any number of other jobs, the figure can be quite high, high enough to make hiring a pro seem like a bargain. A simple compare-and-contrast exercise makes the choice easier.


by Molly Keith Neal page F.01
Document URL: http://proquest.umi.com/pqdweb?RQT=309&VInst=PROD&VName=PQD&VType=PQD&sid=1&index=0&SrchMode=1&Fmt=3&did=000000752335831&clientId=13371

NEW ORLEANS (AP) — A $168 million renovation of the Louisiana Superdome could provide seating and amenities comparable to top new NFL stadiums and give the New Orleans Saints a strong incentive to stay in Louisiana, consultants told a state panel Thursday.


But the consultants told the Superdome Commission that satisfying the Saints demands would require some sort of new tax that would need to generate anywhere between $8.4 million and $12.7 million per year, depending on what the Saints are willing to contribute.


"No matter what, the state would need to identify a new funding source," said Dan Barrett, a Manhattan, Calif.-based sports and entertainment consultant.


Saints executives did not attend the meeting of the Superdome commission but have said they could agree to some combination of renovations and continued cash subsidies from the state in order to drop considerations of moving to another city such as Los Angeles, where the NFL wants a team.


Barrett said a new money source should be found prior to next July, when the state is scheduled to make the fourth installment of a 10-year, $186.5 million payment to the Saints.


A new tax is needed even if the state decides against renovations because hotel and motel tax revenues in the New Orleans area have been falling short of projections since Sept. 11, 2001, making it difficult for the state to make its annual payments to the team.


In addition, the Saints, who can opt out of the current 10-year lease after next season by paying an $81 million penalty, also want to end uncertainty about their long-term plans. If the team´s future in New Orleans is secure, Tom Benson intends to make a pitch at NFL meetings in May for the city to host another Super Bowl in either 2009 or 2010.


State officials expect the Saints to consider at least part of the money spent on renovations as a replacement for the current set of cash payments to the team. Those cash subsidies were seen as a short-term solution to keeping the team here while evaluating Benson´s demand for a better stadium.


The state hired the Kansas City-based Ellerbe Becket design firm to conduct feasibility studies and propose designs for Superdome renovations and for a new stadium.


Becket associates Paul Griesemer and Kelly Kerns first showed the commission how the Superdome in its current state lags behind new or newly renovated NFL facilities they have worked on, including those Seattle, Green Bay, Jacksonville and Chicago.


Their proposals to address those deficiencies included:


— Widening and overhauling concourses to improve fan flow, concessions and rest rooms.
— Adding suites while enlarging and refurbishing the old ones.

— Rebuilding field-level seating to increase the number or premium seats and improve sight lines by moving those seats closer to the field.
— Adding or refurbishing lounges accessible by premium field-level and club seats.

— Adding separate entrances for the club and suite levels so "premium customers have a sense of importance and that they´re well received."
— Removing club level seating in two corners and replacing them with a tower of suites with French Quarter-style balconies.

— Installing new scoreboards and video screens.


All work could be done in two offseasons without displacing the dome´s football tenants or the Essence music festival, Kerns said.


Griesemer added that the distance between the seats and the field on all three levels of the Superdome would be comparable to new football stadiums in Houston and Seattle.


However, the newer stadiums would still have a higher percentage of seats on lower levels, which command higher prices.


Kerns and Griesemer also presented designs for a new stadium on either of two proposed sites. One on state land along the river front, next to the convention center, would cost about $606.5 million. Another at what is now the Iberville housing project would cost $698.3 million, the difference stemming primarily from the cost of acquiring the land. It would be possible to cut the cost of either project by a little more than $100 million, but that would mean dropping a retractable roof and cutting retail and exhibition space.


Kerns said the Superdome is an attractive candidate for renovation, not only because of its size and downtown location, but because it is an architectural landmark that engenders pride in the community.


"One of the big differences we´ve noticed in this project is that people here are really proud of the Superdome," he said. "When Seattle demolished the King Dome, it wasn´t that important to them."


Barrett, who was asked to compare the costs and benefits of the various options, said renovating the dome likely would be the best option given the state´s current cash flow difficulties.


Even extending cash payments without renovating the dome would be more expensive in the long run, he said. He also noted that the Superdome is a state asset and that renovations would improve its attractiveness for a variety of events other than Saints games, including the Sugar Bowl and Super Bowl.


Barrett said teams playing in 21 stadiums that either have been built or renovated since 1995 have seen local revenues increase well above the levels of teams in older facilities.


He noted, however, that the revenue picture alone can be deceiving because many of the teams with new facilities have taken on millions in debt.


The Saints have not had to take on such debt. And with cash payments from the state — which no other NFL team receives — they should be in the top third in the league in current revenues despite being in one of the smallest markets, Barrett said.


The Saints have said only that current payments have placed them