New York Codes, Rules and Regulations › Title 16 - DEPARTMENT OF PUBLIC SERVICE › Chapter IV - STEAM UTILITIES › Subchapter F - Uniform Systems Of Accounts › Article 1 - Classes A and B › Part 463 - Instructions-steam Plant Accounts › Section 463.4 - Components of construction cost

Current through Register Vol. 46, No. 28, July 10, 2024
(a) The cost of construction properly
					 includible in the steam plant accounts shall include, when applicable and when
					 actually incurred, the direct and overhead costs as listed and defined
					 hereunder:
(1) Contract work includes amounts
					 paid for work performed under contract by other companies, firms, or
					 individuals, costs incident to the award of such contracts, and the inspection
					 of such work. It does not include the cost of work performed by the utility on
					 projects when part of the work is performed by the utility itself and part is
					 performed by others under contract.
(2) Labor includes the pay and expenses of
					 employees of the utility engaged on construction work, and also workmen's
					 compensation insurance, pay roll taxes and similar items of expense. It does
					 not include the pay and expenses of employees which are distributed to
					 construction through clearing accounts nor the pay and expenses included in
					 other items hereunder.
(3)
					 Materials and supplies includes the purchase price at the point of free
					 delivery plus customs duties, excise taxes, the cost of inspection, loading and
					 transportation, the related stores expenses and the cost of fabricated
					 materials from the utility's shop. In determining the cost of materials and
					 supplies used for construction, proper credit shall be made for unused
					 materials and supplies, for materials recovered from temporary structures used
					 in performing the work involved, and for discounts allowed and realized in the
					 purchase of materials and supplies.
Note:The cost of individual items of equipment of small
						value (for example, $200 or less) or of short life, including small portable
						tools and implements, shall not be charged to steam plant accounts unless the
						correctness of the accounting therefor is verified by current inventories. The
						costs shall be charged to the appropriate operating expense or clearing
						accounts, according to the use of such items, or, if such items are consumed
						directly in construction work, the cost shall be included as part of the cost
						of the construction.
(4)
					 Transportation includes the cost of transporting employees, materials and
					 supplies, tools, purchased equipment, and other work equipment (when not under
					 own power) to and from points of construction. It includes amounts paid to
					 others as well as the cost of operating the utility's own transportation
					 equipment. (See paragraph [5] of this subdivision.)
(5) Special machine service includes the cost
					 of labor, optional materials and supplies, depreciation, and other expenses
					 incurred in the maintenance, operation and use of special machines, such as
					 steam shovels, pile drivers, derricks, ditchers, scrapers, trenching machines,
					 material unloaders, and other labor-saving machines; also expenditures for
					 rental, maintenance and operation of machines of others. It does not include
					 the cost of small tools and other individual items of small value or short life
					 which are included in the cost of materials and supplies. (See paragraph [3] of
					 this subdivision.) When a particular construction job requires the use for an
					 extended period of time of special machines, transportation or other equipment,
					 the net cost thereof, less the appraised or salvage value at time of release
					 from the job, shall be included in the cost of construction.
(6) Shop service includes the proportion of
					 the expense of the utility's shop department assignable to construction work,
					 except that the cost of fabricated materials from the utility's shop shall be
					 included in "materials and supplies".
(7) Protection includes the cost of
					 protecting the utility's property from fire or other casualties and the cost of
					 preventing damages to others, or to the property of others, including payments
					 for discovery or extinguishment of fires, cost of apprehending and prosecuting
					 incendiaries, witness fees in relation thereto, amounts paid to municipalities
					 and others for fire protection, and other analogous items of expenditures in
					 connection with construction work.
(8) Injuries and damages includes
					 expenditures or losses in connection with construction work on account of
					 injuries to persons and damages to the property of others; also the cost of
					 investigation of and defense against actions for such injuries and damages.
					 Insurance recovered or recoverable on account of compensation paid for injuries
					 incident to construction shall be credited to the account or accounts to which
					 such compensation is charged. Insurance recovered or recoverable on account of
					 property damages incident to construction shall be credited to the account or
					 accounts charged with the cost of damages.
(9) Privileges and permits includes payments
					 for and expenses incurred in securing temporary privileges, permits or rights
					 in connection with construction work, such as for the use of private or public
					 property, streets, or highways, but it does not include rents, or amounts
					 chargeable as franchises and consents for which see account 302, Franchises and
					 Consents.
(10) Rents includes
					 amounts paid for the use of property during the construction period, such as
					 construction quarters and office space occupied by construction forces and
					 amounts properly includible in construction costs for such facilities jointly
					 used.
(11) Engineering and
					 supervision includes the portion of the pay and expenses of engineers,
					 surveyors, draftsmen, inspectors, superintendents, and their assistants
					 applicable to construction work.
(12) General administration includes the
					 portion of the pay and expenses of the general officers and administrative and
					 general expenses applicable to construction work.
(13) Employee pensions and benefits includes
					 the portion of the cost of employee pensions and benefits which is applicable
					 to construction work.
(14)
					 Engineering services includes amounts paid to other companies, firms or
					 individuals engaged by the utility to plan, design, prepare estimates,
					 supervise, inspect, or give general advice and assistance in connection with
					 construction work. A copy of the agreement or arrangement under which such
					 services are rendered shall be preserved.
(15) Insurance includes premiums paid or
					 amounts provided or reserved as self-insurance for the protection against loss
					 and damages in connection with construction, by fire or other casualty, injury
					 to or death of persons other than employees, damages to property of others,
					 defalcation of employees and agents, and the nonperformance of contractual
					 obligations of others. It does not include workers' compensation or similar
					 insurance on employees included as "labor" in subdivision (b) of this
					 section.
(16) Law expenditures
					 includes the general law expenditures incurred in connection with construction
					 and the court and legal cost directly related thereto, other than law expenses
					 included in protection, paragraph (7) of this subdivision, and in injuries and
					 damages, paragraph (8) of this subdivision.
(17) Taxes includes taxes on physical
					 property (including land) during the period of construction and other taxes
					 properly includible in construction costs before the facilities become
					 available for service. The period of construction shall extend from the date of
					 commencement of construction to the time when property is ready for service and
					 shall also include any reasonable and necessary period during which the
					 property is held for future service; but shall not include, except upon order
					 of the commission, any period in excess of one year during which construction
					 is suspended.
(18) Interest during
					 construction includes the net cost of borrowed funds used for construction
					 purposes and a reasonable rate upon the utility's own funds when so used.
					 Interest during construction shall be charged to the individual job upon which
					 the funds are expended and shall be credited to account 536, Interest Charged
					 to Construction--Credit. The period for which interest may be capitalized shall
					 be limited to the period of construction. No interest charges shall be included
					 in these accounts upon expenditures for construction projects which have been
					 abandoned. (See paragraph [17] of this subdivision.)
Note:When a part only of a plant or project is placed in
						operation but the construction work as a whole is incomplete, that part of the
						cost of the property placed in operation shall be treated as "steam plant in
						service" and interest thereon as a charge to construction shall cease.
(19) Earnings and expenses during
					 construction. The earnings and expenses during construction shall constitute a
					 component of construction costs.
(i) The
					 earnings shall include revenues received or earned for steam produced by
					 generating stations during the construction period and sold or used by the
					 utility. When such steam is sold to an independent purchaser before
					 intermingling with steam generated by other plants, the credit shall consist of
					 the selling price of the steam. When the steam generated by a plant under
					 construction is delivered to the utility's steam system for distribution and
					 sale, or is delivered to an associated company, or is delivered to and used by
					 the utility for purposes other than distribution and sale (for manufacturing or
					 industrial use, for example), the credit shall be the fair value of the steam
					 so delivered. The revenues shall also include rentals for lands, buildings,
					 etc., and miscellaneous receipts not properly includible in other
					 accounts.
(ii) The expenses shall
					 consist of the cost of operating the steam generating station and other cost
					 incident to the generation and delivery of the steam for which construction is
					 credited under subparagraph (i) of this paragraph, including the cost of
					 repairs and other expenses (but not taxes) of operating and maintaining lands,
					 buildings and other property, and other miscellaneous and like expenses not
					 properly includible in other accounts.