January 31, 2005
FOR THE HEADS OF DEPARTMENTS AND AGENCIES
Discount Rates for OMB Circular No. A-94
On October 29,
1992, OMB issued a revision to OMB Circular No. A-94, "Guidelines and
Discount Rates for Benefit-Cost Analysis of Federal Programs." The
revision established new discount rate guidelines for use in benefit-cost
and other types of economic analysis.
Circular specifies certain discount rates that will be updated annually
when the interest rate and inflation assumptions in the budget are changed.
These discount rates are found in Appendix C of the revised Circular. The
attachment to this memorandum is an update of Appendix C. It provides discount
rates that will be in effect for the period February 2005 through the end
of January 2006.
The rates presented
in Appendix C do not apply to regulatory analysis or benefit-cost analysis
of public investment. They are to be used for lease-purchase and cost-effectiveness
analysis, as specified in the Circular.