17 AAC 15.351. Estimates and costs

(a) The cost estimate referred to in 17 AAC 15.331(c) must reflect all the work shown on the plans and the scope-of-work statement referred to in 17 AAC 15.361 and 17 AAC 15.371, respectively. The estimate must set out the items of work to be performed in sufficient detail to provide a reasonable basis for analysis by the department. All factors included in the utility's general overhead account must be listed in the cost estimate.

(b) Preliminary engineering costs incurred after the date of the department's letter authorizing the utility to proceed with preliminary engineering will be reimbursable or chargeable to the utility's relocation-project work order or account. Preliminary engineering costs will continue to be chargeable to the utility's relocation-project work order or account until the date that the utility relocation agreement has been approved and signed by the department. Construction engineering costs, including engineering and inspection costs associated with the relocation of the utility facility, that are incurred after the date that the utility agreement is signed and approved by the department are reimbursable.

(c) Charges for engineering, inspection, equipment, transportation, materials handling, and labor included in the utility's general overhead account, need not be listed separately in the cost estimate.

(d) Charges incurred by the utility before the department's letter of authorization to proceed with preliminary engineering is sent will, in the discretion of the department, be ineligible for reimbursement.

(e) When the department determines that an existing facility must be removed by a utility, the actual cost of removal will, in the discretion of the department, be eligible for reimbursement. Where appropriate, the salvage value of the facility to be removed will be credited against the cost of removal.

(f) The department will have a credit against reimbursable costs set out in the relocation agreement equal to the value of any materials removed by the utility, unless the utility relocation work is being performed under a state contract or under a utility-let contract and the utility relocation agreement specifies that all removed materials become the property of the contractor. The value of the department's credit is to be measured by whatever rate the utility uses in its normal operations and is to be equal to the salvage value of all materials removed less the cost of removal. All materials must be removed by the most economical method possible. Recovered materials which are not usable in the normal operations of the utility but which have a sale value as scrap must be included in the calculation of the credit granted to the department. The value of the recovered scrap materials is to be determined by their estimated scrap value. Temporary-use materials which are reusable must be credited to the utility relocation project at stock prices, less the utility's prescribed stock-handling charge.

(g) Where betterments are not required by the department's construction project, but are installed solely for the benefit of the utility company, all costs attributable to these betterments are not eligible for reimbursement.

(h) The utility shall show on its work order account all relocation costs specified by the relocation agreement, including reimbursable and non-reimbursable items. Separate work order accounts will, in the discretion of the department, be used where the reimbursable and non-reimbursable portions of work can be distinguished by location or type of facility. All work order accounts to be used by the utility must be shown in the relocation agreement.

(i) An eligibility ratio for reimbursement must be determined and set out in the relocation agreement when the relocation work includes both reimbursable and non-reimbursable items.

(j) The department has an expired service life credit against reimbursement costs if a utility facility, including a building, pumping station, filtration plant, electric power substation, or other similar operational unit, is replaced. Credit for expired service life will not be required for a segment of utility service, distribution, or transmission line.

History: Eff. 5/23/82, Register 82; am 10/17/87, Register 104

Authority: AS 02.15.104

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