SECTION 310:2-19-3. Procedures and methods

  General. On or before April 15 of each year the Department shall, after conferring in good faith with the Construction Industries Board, enter into an agreement for the purpose of determining the portion of the Agency's total indirect costs to be allocated to the Construction Industries Board. In determining allocated indirect costs the Department must utilize that method of the two (2) methods set forth below that produces the least overall cost allocation to the Construction Industries Board.

(1)   Adjusted indirect cost agreement allocation method. The Department's most current approved indirect cost agreement or rate is adjusted/reduced by removing those cost centers not included within the selected administrative cost centers, to create the adjusted indirect cost agreement. The resulting adjusted indirect cost agreement represents an adjusted overhead rate that shall be applied to the overall salary costs of the Construction Industries Board, by revolving fund, to arrive at the allocation of Department administrative costs to the particular revolving fund(s).

(2)   Direct allocation of actual administrative cost method. The sum of the indirect costs incurred in the most recently completed fiscal year by a given cost center (i.e. each component or cost center within the selected administrative cost centers) is divided by that basis (e.g. total number of employees (FTEs) employed by the agency, total payroll of the agency, total number of discreet tasks performed, etc.) selected by the Commissioner as the most current and appropriate reflection of the average level of present service utilization of the given cost center by the Construction Industries Board, thereby deriving a unit cost for the services provided by the given cost center. The unit cost is then multiplied by the number of basis units applicable to the Construction Industries Board thereby deriving the aggregate indirect cost allocable to the Construction Industries Board for the given cost center. Each aggregate indirect cost allocation that is determined for each cost center identified as a component of the selected administrative cost centers is then totaled to yield the entire indirect cost allocation to be allocated by the Department to the Construction Industries Board and fixed, thereby, as the total indirect cost to be charged by the Department for the impending fiscal year. Additionally, any indirect cost item within a selected administrative cost center, specifically identifiable as a service or service component that is delivered or provided directly to the Construction Industries Board, shall be added to the annual fixed indirect cost charged by the Department and allocated to the Construction Industries Board within ninety (90) days of incurrence or identification.

[Source: Added at 19 Ok Reg 2041, eff 6-27-02]