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<br />$500,000,000 (January 2003 price level) of the total project costs. Consequently, the <br /> <br /> <br />Secretary may forgive the obligation of the non-Indian sponsors relative to the <br /> <br /> <br />$163,000,000 increase, and any effects in inflation thereon, in estimated total project <br /> <br />costs that occurred in 2003. <br /> <br />. <br /> <br />This document is to record and acknowledge certain decisions made by Reclamation <br /> <br />regarding implementation of the provision cited above after consultation with all Project <br /> <br />sponsors, including the Tribes. <br /> <br />B. Implementation Methodology. <br />1. Cost Allocation Method: The current contracts are based on the 2001 Interim Cost <br /> <br />Allocation Method. This method will continue to be used for allocating costs. <br /> <br />2. Specific Costs and the Reimbursement Cap: The statutory language provides that the <br /> <br />reimbursable costs shall not exceed $43 million for the first $500 million of total project <br /> <br />costs, thereby establishing a reimbursement cap that covers both specific costs and joint <br /> <br />costs. Therefore, the reimbursable specific costs for the City of Durango shall be <br /> <br />subtracted from the $43 million reimbursement cap before the remainder is distributed <br /> <br />among the sponsors paying the joint reimbursable costs. <br /> <br />. <br /> <br />3. Quarterly Billing Method: Reclamation has developed a "Cap Conversion Factor" to <br /> <br />be applied to post-1999 actual joint cost expenditures to adjust escrow draws in <br /> <br />accordance with the reimbursement cap. The current Cap Conversion Factor and its <br /> <br />. <br />