Common use of ANTICIPATED CAPITAL AND DEBT EXPENSES Clause in Contracts

ANTICIPATED CAPITAL AND DEBT EXPENSES. The CONTRACTOR will prepare and submit a three year capital budget which forecasts debt or capital expenses greater than five thousand dollars ($5,000.00) related to development, expansion, and other capital improvements including leases. Any change in the use of funds must be pre-approved by the AGENCY. To allow for delays in actual expenses and the approval of the expense by the AGENCY, half of the annual depreciation expense will be allowed for use in the first Rate Year that the expense is anticipated in, with the full annual depreciation expense being allowed in the following Rate Years based on the date of purchase. Employees of CONTRACTOR, as reviewed by the AGENCY, must substantiate these projected cost estimates. The term of the amortization of these expenses will be determined on a case by case basis, according the depreciation schedules described herein, depending on the size and nature of each expense. All reasonable means must be employed to anticipate these capital costs in order to mitigate Rate shock. Large anticipated expenses could be captured through Rates several years in advance of their actual incurrence. If future expenses are Pre-funded with current collection fees, all such funds shall be deposited as collected monthly into third party trust accounts, in a manner acceptable to the AGENCY Auditor.

ANTICIPATED CAPITAL AND DEBT EXPENSES. The CONTRACTOR will prepare and submit a three year capital budget which forecasts debt or capital expenses greater than five thousand dollars ($5,000.00) related to development, expansion, and other capital improvements including leases. Any change in the use of funds must be pre-approved by the AGENCY. To allow for delays in actual expenses and the approval of the expense by the AGENCY, half of the annual depreciation expense will be allowed for use in the first Rate Year that the expense is anticipated in, with the full annual depreciation expense being allowed in the following Rate Years based on the date of purchase. Employees of CONTRACTOR, as reviewed by the AGENCY, must substantiate these projected cost estimates. The term of the amortization of these expenses will be determined on a case by case basis, according to the depreciation schedules described herein, depending on the size and nature of each expense. All reasonable means must be employed to anticipate these capital costs in order to mitigate Rate shock. Large anticipated expenses could be captured through Rates several years in advance of their actual incurrence. If future expenses are Pre-funded with current collection fees, all such funds shall be deposited as collected monthly into third party trust accounts, in a manner acceptable to the AGENCY Auditor.