FIN 07-20

Attachment A

Reclamation Manual
Directives and Standards
INTEREST DURING CONSTRUCTION
PROCEDURES FOR COMPUTING SPREADSHEETS

A. The IDC will be computed, verified, and recorded to the accounts by September 30 of each year. If actual IDC cannot be determined by this date, then during the last quarter of the fiscal year, record an estimate of what the IDC will be for the current year. The estimate should be calculated using any reasonable means available, such as using last year's IDC as an estimate of this year or using cost and disbursement information through the third quarter for the current year's activity. For new construction, additions, replacements, or deficits, do not record any estimates until the following year.

B. If estimates were used for the prior year, these should be adjusted to include the actual cost and disbursement data for that year. The repayment contracts will be reviewed for new amendments and the regional/project economist will be contacted for any new legislation, changes in allocations, and verification of current information being used in the IDC calculation. Prior period cost adjustments will be distributed to the appropriate years. The current information thus obtained will be entered into the personal computer (PC) spreadsheets similar to those shown in this Attachment A, figures 2 or 3. Copies of applicable documents/provisions will be maintained in the permanent IDC file for easy reference and the IDC spreadsheets will be footnoted with any changes included for the year.

C. For a new construction project, review the authorizing legislation, Budget Justifications, Project Data Sheets, Definite Plan Reports, repayment contracts, and any other available information for provisions relating to the calculation of interest and allocation to reimbursable functions subject to IDC. Coordinate with the area office, project engineer, and economist for determining the facts specific to the project as they relate to the calculation of IDC. Make copies of any documents/provisions for the permanent IDC file that support the IDC rate determinations or multipurpose allocations to be used. Set up a spreadsheet on a PC incorporating the specifics determined. See this Attachment A, figure 2.

D. For additions or replacements or Safety of Dams (SOD) repairs, review such documents as programs, budget documents, repayment contracts, and any other information available to determine if the addition/replacement/repair

The IDC shall not be calculated until all this information is known. Note that IDC for SOD repairs is to be calculated in accordance with Section 4(c)(1) of the SOD Act Amendment of 1984. Make copies of applicable documents/provisions for the permanent IDC file and set up a spreadsheet on a PC similar to this Attachment A, figure 3. No adjustment is required if IDC has already been charged on additions and replacements started before October 1, 1982.

E. Upon completion:

(1) For replacements and additions, all information and documentation will be reviewed and calculations will be independently verified by economic and finance staff to determine the final IDC to transfer to plant.

(2) For construction and deficits, a FCA will be prepared by the economists, including the calculation of reimbursable IDC. The information included in the FCA will be used in the IDC spreadsheet to recalculate all IDC for the project. The recalculated IDC will be compared to the FCA amounts and reconciliation performed for any difference.



(020) 4/1/96