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Last modified
1/26/2010 3:15:19 PM
Creation date
10/12/2006 4:36:48 AM
Metadata
Fields
Template:
Water Supply Protection
File Number
8112.600
Description
Arkansas White Red Basins Interagency Committee - AWRBIAC -- Reports
Basin
Arkansas
Water Division
2
Date
3/13/1952
Title
Cost Allocation - Third Progress Report of the Work Group on Benefits and Costs - AWRBIAC Committee
Water Supply Pro - Doc Type
Report/Study
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<br />-.0 <br />;-~. ,'. <br /> <br />:::.;.-.:;.' <br /> <br />of allocating cost to any function should not exceed the cost of <br />providing equivalent services to the S9.me area from tho most likely <br />economically feasible alternative source available. <br /> <br />The sun of the separa~le cost and the allocated joint cost <br />for each purpose constitutes the total allocation to that purpose. <br />The total cost thus allocated to euch purpose should not be Jess <br />than the cost. of includinl'; that purpose in the project and Sll~L'.ld <br />not be more than the benefits of that purpose or the cost of the most <br />economical single-purpose alternative. <br /> <br />RECOIAl'lE}T])ED APPLICATION PROCEDURES <br /> <br />Although the work group recognized that cost allocation is <br />not an exact science, these procodural recommendations have evolved <br />from discussion of the many questions and problems associated with <br />the Separable Costs-Remaining Benefits method of cost allo~[\tion and <br />from comparison of several practical, exploratory exa:,o.:>les of ve.rio'~s <br />methods of cost allocation. <br /> <br />It is recom~ended that the Separable Costs-Remaining Eene- <br />fits method of allocation be adopted for purposes of the A~rn roport <br />and be used where cost allocation is required until it is found <br />that this method results in obviously inequitai'le cost al]ocations. <br />In such cases, other reco~nized methods may be applien and corr~ared. <br />Final adoption of a method other ths.n the Separ'~ble Gosts-Remaining <br />Benefits method for a particular project chall re'J',ire approval' of <br />the AWRiHAC. <br /> <br />Benefi ts I All functions which produce a benefi t, vlhich <br />may be evaluated by methods already adopted by the A~RBIAC and by <br />methods which may hereafter be adopted by the Al}.1RBIAC. and which m9.y <br />be properly included in a multiple-purpose project according to the <br />criteria of the Green Book which have been adopted by the AWR6IAC, <br />should specifically enter into determinations of the allocation of <br />the cost of' a multiple-purpose project amongst such functions. All <br />functions whose benefit is real and valuable should be included in <br />the determinations J includi.ng al SO those functions whose benefits <br />are attained without identifiable cost to the project. It should <br />be reco~nized that present policy and law may not provide for or <br />permit full or any reimbursement of costa as allocated in accordance <br />with the preceding statement. <br /> <br />It is presumed that these benen ts, properly associ.ated <br />with the ffiagni tude of the facilities an:l the procedure s of opero.ti.on <br />which produce them in the multiple-purpose project J will have heel! <br />evaluated in previous engineering and economic analyses which led to <br />formulation of the project. <br /> <br />-3- <br />
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