What needs to be adjusted if a project start is delayed by a year?

When a project's start is delayed by a year, one of the most significant adjustments that need to be considered is the 'escalation' line item in the budget. Escalation refers to the increase in costs over time due to inflation or market factors. A delay in the project timeline can lead to changes in the prices of materials, labor, and services as economic conditions shift.

By extending the project timeline, you must account for the potential increase in these costs when the project is eventually initiated. Therefore, the escalation line item is crucial for ensuring that the budget remains accurate and reflective of the future costs that will be incurred. This can help prevent budget overruns and ensure that funds allocated are sufficient to cover the actual costs at the start of construction after the delay.

Adjustments to design specifications, budget constraints, and material selection may also be necessary, but they are typically secondary considerations once the escalated costs have been accounted for in the project budget.