The first step in developing a cost control system is to develop procedures to track costs. Street departments were most effective at tracking labor costs, with the majority tracking payroll, vacation and sick leave data. Almost 75% of the cities used an automated payroll system, but these systems were little more than automated recordkeeping.. passing payroll information to the finance office.

While most departments track labor costs at the department level, fewer cities track labor costs associated with individual projects, equipment items, pavement segments or other detailed basis. In other words, the superintendent could determine overall labor costs, but couldn't evaluate labor costs on a per-project, per-equipment item basis.

Likewise, most departments track equipment costs at the department level, but fewer cities track equipment costs by project or other basis. Several cities use a computerized fleet management system, but less than half track fuel, oil, tires and repair parts by equipment item. This was surprising, since more than half of the cities had an automated fuel system.

Repair parts and material inventories represent major cost centers for the department. Yet only 25% of those surveyed used an inventory control system and most of those systems were manual, hand-processed recordkeeping.

Manual systems were obviously the most-common method of cost tracking. A manual system is clearly better than no system at all and it can form the basis for more sophisticated tracking systems. But the evidence shows that manual systems fail to provide analytical information or meaningful management reports.