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UNDERSTANDING OF NEED <br />.. <br />FULL COST CALCULATION METHODOLOGY <br />COST PLANS - COMPARING THE TWO TYPES OF PLANS <br />FULL COST VS. FEDERAL COST ALLOCATION PLANS: Cost allocation plans are a series of complex <br />calculations that require an understanding a jurisdiction's financial reports, administration structure, and <br />operational services and programs. These calculations are typically presented In two types of plans — a <br />Full Cost plan or a plan that conforms with 2 CFR Part 200 (Formerly OMB Circular A-87) Uniform <br />Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards. It is possible <br />to use the latter for all costing purposes, but in certain cases, an agency would not maximize its revenue <br />recovery by using this plan. To fully calculate the full cost of city services, a City may consider a Full Cost <br />Allocation plan. However, if the calculations from the CAP are to be used for federal of state <br />reimbursement, the 2 CFR 200 CAP is the document typically required. In this section, we will provide a <br />discussion of both types of plans. <br />Local agencies provide services that include administrative and support expenditures which are not <br />allowable for federal reimbursement. These expenditures, however, are appropriate for allocation under <br />GAAP principles and guidelines. This allocation methodology is often referred to as a Full Cost allocation <br />plan. It can be generalized that a Full Cost allocation plan is applicable for Internal purposes such as <br />recovering indirect costs from enterprise funds, special revenue funds and other funds, as well as included <br />In establishing user fees, permits and applications, billing rates, hourly rates and costs of special services. <br />Using federal guidelines, which are now codified in the Code of Federal Regulations (CFR) part 200, local <br />governments may be reimbursed for administrative and support expenditures if they are documented in <br />MGT CITY OF SANTA AN/, CALIFORNIA I MARCH 8, 2018 PAGE 5 <br />CONSULTING GROUP RFP NO. 18-02311 PROPOSAL FOR COST ALLOCATION PLAN/ ISF ALLOCATION STUDY <br />25A-55 <br />