Priority setting is a necessity setting activity because the scarcity of resources does not permit a community or organization to undertake all projects that it would like to implement. The agency charged with developing the capital improvement program can provide valuable assistance to cost projections. The agency staff can stress the importance of long-range needs, interpret instructions and complete forms required to promote uniform application policies and procedures.

 In addition, a number of officials (e.g. the budget director or the city engineers) may be needed to answer questions such as the following:

          1. In what ways and to what extent would the proposed project impact on general in the city or government development?

          2. Who will be benefited or hurt by this project.

          3. Is it a replacement of an existing structure or a new added responsibility to the government?

          4. Will the project expand the taxable property and economic base of the community? I.e. what will be the impact on the existing revenue?

          5. What effect would the project have on the efficiency and cost effectiveness of service performance?

          6. Can the city or the government afford the proposed capital improvement.

          7. Will the project be a revenue producer?

          8. What is likely to be the extent of citizen or political opposition?

 In the priority setting process an initial review should be conducted to eliminate proposals that appear impractical during the coming period. Once this is done, simply and precisely defined selection criteria should be established to enhance the community or the organization’s present and future financial viability.

 Perhaps a general criterion, such as shown in the table below, for a capital improvement system may be employed.

 Table1 Capital improvement programme


Applicable Criteria




Urgently needed in a

health, 1 year or less

Immediate implementation to relieve danger to public

welfare or safety.






Those that are necessary

or essential (in 2 to 3 years)


Complete project to bring about major improvement to remove existing deficiency and impediments.




Desirable improvement

(5 – 6 yrs)


Here the project identified to meet anticipated or projected

future needs.





Deferrable improvements




Foreseeable needs for project cannot be effectively supported as part of the present C.I.P.