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REQUIREMENTS AND POLICIES MANUAL

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Recharges

    Title:

    Recharges

    Publication date:

    9/26/2013

    Effective date:

    6/1/2011

    BRIEF

    Policy Summary

    Berkeley Lab recharge centers provide specific scientific facilities (e.g., 88-Inch Cyclotron), technical capabilities (e.g., Engineering Shops), or general services (e.g., Telephone Services) to multiple users where subscribers have discretion over the amount of service used.

    This policy provides guidance for all Berkeley Lab recharge centers with a common framework for the equitable and accountable distribution of user charges, which are based on the costs of the facilities, goods, and services provided.

    Who Should Read This Policy

    All Berkeley Lab employees that provide or utilize recharge centers

    To Read the Full Policy, Go To:

    The POLICY tab on this wiki page

    Contact Information

    Indirect Budget Manager, OCFO

    Title:

    Recharges

    Publication date:

    9/26/2013

    Effective date:

    6/1/2011

    POLICY

    A. Purpose

    The purpose of this policy is to provide all Lawrence Berkeley National Laboratory (Berkeley Lab) recharge centers with a common framework for the equitable and accountable distribution of user charges, which are based on the costs of the facilities, goods, and services provided.

    B. Persons Affected

    All Berkeley Lab employees that provide or utilize recharge centers

    C. Exceptions

    None

    D. Policy Statement

    1. A Berkeley Lab recharge center provides specific scientific facilities (e.g., 88-Inch Cyclotron), technical capabilities (e.g., Engineering Shops) or general services (e.g., Telephone Services) to multiple users where subscribers have discretion over the amount of service used.
    2. A recharge center is appropriate when the costs of the provided services/facilities would not be equitably distributed on a broader or more general allocation base. Therefore, recharges are not appropriate when adequate cost distribution can be better realized through a broader allocation base; and/or when users of the service have no control or discretion over the service provided due to regulations, Berkeley Lab policy, or other constraints.
    3. Research and Development activities are not appropriate for recharges
    4. Recharges are appropriate when the following conditions and/or circumstances are present:
      1. Provides a more precise allocation of costs to users based on the benefits received
      2. Encourages optimal use of a service or resource
      3. Assists in the evaluation and control of the cost of a service
      4. Assures equitable costing that complies with Cost Accounting Standards (CAS)
    5. Criteria for Development and Application of Recharge Rates
      1. Costs of providing the service for a fiscal year are identified, estimated, and reviewed. Options for gaining greater cost efficiencies and alternative methods of service delivery should both be considered as cost-control mechanisms.
      2. Demand for the service (i.e., the estimated user [distribution] base) should be projected based on best available forecast data. The distribution base selected should be a reasonable measure of the benefits users received from the service and should result in an equitable allocation of the service's costs to its users (i.e., users are charged for what they get). In addition, the estimated base volume should reflect the anticipated actual usage of the service rather than the number of units of the service available or service capacity.
      3. If a measure of the benefits users receive is unavailable or impractical to ascertain, a measure of the output of the recharge center's activities is acceptable. In addition, where a single unit of output will not reflect the proportional consumption of resources in circumstances where the level of resource consumption varies materially among the units of output produced, the output measure should be modified or more than one output measure should be used.
      4. Following is a hierarchy of three allocation measures appropriate for recharge centers, listed in descending order of preference:
        1. A measure of activity or resources consumed (e.g., labor hours, machine hours, or square footage)
        2. An output measure (e.g., number of printed pages for a print shop, number of purchase orders processed by a purchasing department, or number of machines maintained)
        3. A surrogate for consumption (e.g., number of personnel, labor, or total dollars or square feet of the unit receiving the service)
      5. A preliminary rate is developed on a break-even basis for Berkeley Lab users. The objective is to establish rates that will recover exactly the costs of providing the services or products. Every effort will be made to ensure that at fiscal year end, cumulative recovery equals cumulative costs of providing the services or products. Recharge managers are required to monitor execution throughout the fiscal year. If material variance is forecasted, rates and/or budgets will be appropriately revised to allocate the variance. Additionally, recharge center managers are required to submit rate-change proposals to the Budget Office for review and approval prior to implementation.
      6. Estimated costs for the fiscal year and the projected distribution base volume must be developed in an auditable manner that incorporates best available data and considers prior-year cost/recovery variance. Any rate that has consistently over- or under-recovered costs must be evaluated during the formulation stage to address the chronic cause for these variances.
      7. The recharge center should be established on the basis that it must assign costs accurately (i.e., one recharge center cannot subsidize another recharge center). It is not acceptable to plan or transfer any over-/under-recovery in one cost center to another cost center.
      8. It is the responsibility of the organization that sponsors the recharge rate to assure that, where appropriate, the rate charged for the service offered to the Berkeley Lab is competitive within local commercial markets. If the level of the proposed rate cannot be justified and supported from a good business perspective, the sponsoring organization must consider options for improving the cost structure or consider suspension of the service in favor of utilizing an outside vendor.
      9. The costs of administering the recharge (development of the rate and distribution of user charges) should not be of such magnitude to negate the benefits received from the more precise distribution of the recharge center's costs. To this end, automated systems should be used to the maximum extent practical in distributing costs to users.

    E. Roles and Responsibilities

    Managers, supervisors, and employees have the responsibility to adhere to the provisions of this policy.

    F. Definitions/Acronyms

    Term

    Definition

    Allocate

    To assign an item of cost, or a group of items of cost, to one or more cost objectives. This term includes both direct assignment of cost and the reassignment of a share from an indirect cost pool.

    Cost Objective

    A function, organizational subdivision, program, or other work unit for which cost data are desired and for which provision is made to accumulate and measure the cost of processes, products, jobs, projects, etc.

    G. Recordkeeping Requirements

    None

    H. Implementing Documents

    Document Number

    Description

    Type

    11.02.004.000

    Organization Burden

    Policy

    I. Contact Information

    Indirect Budget Manager, OCFO

    J. Revision History

    Date

    Revision

    By whom

    Revision Description

    Section(s) affected

    Change Type

    9/26/2013

    1.1

    Lundell

    Review completed 5/9/2013, no changes

    Publ & Next Review Dates

    Minor

    1/2/2012

    1

    Lundell

    Reformat for wiki

    All

    Minor

    DOCUMENT INFORMATION

    Title:

    Recharges

    Document number

    11.02.005.000

    Revision number

    1.1

    Publication date:

    9/26/2013

    Effective date:

    6/1/2011

    Next review date:

    6/1/2015

    Policy Area:

    Budget

    RPM Section (home)

    Financial Management

    RPM Section (cross-reference)

    Section 11.41

    Functional Division

    OCFO

    Prior reference information (optional)

    RPM Section 11.41

    Source Requirements Documents

    Implementing Documents

    Document Number

    Description

    Type

    11.02.004.000

    Organization Burden

    Policy

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