Asset: Long-lived entity with productive capacity, obtained from an investment or capital expenditure. For USACE, assets include dams, levees, locks, improved channels, and power houses. Assets are also denoted as infrastructure because they facilitate production of other goods and services.

Capital Stock Value: The value of a particular type of asset surviving from past periods that has been corrected for its loss in productive capacity.

Deterioration: The decline in productive capacity over time.

Expenditures: Dollars dedicated to creating capital (e.g., assets and/or infrastructure) with productive capacity (synonymous with “investment”).

Major Rehabilitation: Investment or maintenance sufficient to effectively “restart” an asset’s service life

Rate of Decline: Represents the percentage change in an asset’s productive capacity when age moves by one unit. The β represents the coefficient controlling the rate of decline for the hyperbolic age-efficiency profile.

Productive Capacity – The potential of capital to generate services and benefits given historical investment (i.e., dollars dedicated to creating capital with productive capacity), asset deterioration over time, maintenance, and rehabilitation (i.e., investment or maintenance sufficient to effectively “restart” an asset’s service life).

Retirement: The act of putting an asset out of service because it has reached the end of its service life.

Service Life: The number of years that an asset is maintained in service with some level of productive capacity.