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LJ <br />A si <br />isles. <br />calll <br />the i <br />Prot <br />join! <br />207. <br />reun <br />proje <br />facto <br />di 13ei <br />a resl <br />over J <br />apple <br />u ], <br />Attnellr â–ºrent 1 <br />Discussion on Development of Cap Conversion Fi&tor <br />mpliiicd approach to accourrthig for the effect of Section 207 on Escrow Agreement <br />im quarterly payments was prasemcd to the two contractors that Bold repayment <br />acts. A. drriil wor }aLect (Attachnacnt 4) provided propose~ a metlloel of rrpplyinb <br />Itcut of Section 207 to actual joint cost expenditures Jor use ill the quarterly Uilliug <br />;ss. 7'llc nlctllodolog }+ applies a ratio, or cap conversion factor, to post -7999 achral <br />wst expenditures to reflect the cap on respayrneut liability established in Section <br />Tbc lrse of the ratio is intended to meet the requirement of Section 207 for the <br />llu-sable costs not to exceed $43,000,000 for the first $500,000,000 of the total <br />-t costs. To simplify the admi- nistralion of the escrow account, the cap conversion, <br />- is applied to all joint costs incurred from 1999 to Ole present. 'Mis results in a <br />cute between the amount actuallypaid to date by contractors and the anlourrt duc as <br />It of Section 207. It is Rwlamation's position that this difference is not all <br />aynierrt, as the amounts paid to date were billed ;tnd paid in accordance with the <br />able agree onts and law at the [Imcthtc payments were madc. <br />