OP 62.35: Utilities Charges

DATE: December 14, 1995

PURPOSE: The purpose of this Operating Policy/Procedure (OP) is to establish policy and procedure for charging utilities to activities which must pay for these services.

REVIEW: This OP will be reviewed on October 1 of even-numbered years by the Director of Accounting Services (DAS) with recommendations for change forwarded to the Vice President for Fiscal Affairs (VPFA) by October 15.

 

POLICY/PROCEDURE

1. Policy

Auxiliary enterprises, student service fee activities which generate additional income from other sources, the Center for Professional Development and Agricultural Services activities will be charged for any utilities used in accordance with the provisions of this OP. Charges will not be made to any activity which does not use utilities on a continuing basis with the exception of the Carol of Lights, which is conducted annually.

2. Procedure

  1. General

    Agricultural Services, the Athletic Training Center, Intercollegiate Athletics, the University Center, Central Food Facilities, Residence Halls, Housing Services and selected other facilities are billed monthly and will have an asterisk preceding the account number on the listings attached to this OP. All other activities are billed annually. The charge made may be either the total of the actual or estimated charges for each type of utility used in a billing or it may be an overall charge calculated on the basis of a yearly dollar figure per net square foot of space assigned. When meters are installed in buildings, actual charges are used; when they are not, charges are estimated usually on the basis of square footages. Charges for manufactured utilities such as steam and chilled water are computed monthly using actual production costs, an allowance for repair and replacement and debt service requirements. Residence Halls charges will be adjusted during summer months to reflect reduced consumption.

  2. Basis for Monthly Charges (calculated each month)

    1. Electric - All electric consumption is metered by building. All are charged for measured consumption times the vendor rate per KWH, which varies month to month.

    2. Natural Gas and Water - Meters for these utilities serve multiple buildings and charges are formula based - gross area of building charged/gross area of campus X total dollar value of the utility delivered to the campus. Central Heating and Cooling Plant use is excluded from the formula as these utilities are metered separately for the Plant.

    3. Manufactured Utilities (Steam, Refrigeration, Air) - Charges are formula based - gross area of building, or portion of building served, campus gross area served with that utility, (e.g., not all buildings are served from the Central Plant and some get steam but not refrigeration) X total dollar value of the utility delivered to campus.

  3. Method of Calculation, Central Plant Sale of Manufactured Utilities

    1. The selling price of each manufactured utility (steam refrigeration, air) is calculated separately each month. The selling price is the sum of the cost of production and the debt service expense.

      1. The cost of production for any given month is the sum of actual plant expense for labor, materials, services and purchased utilities (electric, gas, water).

      2. Debt service is that expense to the plant required to retire bonded indebtedness. An amount to cover the debt service and an amount for future plant repairs shall be included in the rates charged for utilities.

  4. Joint Usage

    When an activity which is required to pay for utilities uses a building jointly with another activity which is not, the charge will be made on a pro rata basis. This may be either on a percentage of space used or a percentage of time used or a combination of both; depending on which most closely approximates the correct figure for the actual operation.

  5. Student Service Fee Activities

    Student service fee (SSF) activities will not be charged for utilities except when they generate additional income from other sources such as sales and services, other fees, rentals, contributions, etc. When they do, a pro rata charge will be made for utilities. The charge will be determined by:

    1. Calculating the percentage of non-SSF funding (non-SSF dollar income/total dollar income X 100); and,

    2. Applying it to the total utilities charge (modified as per section 2.d. where applicable). The charge will be calculated and billed near the end of the fiscal year using year-to-date actual income as of July 31. When University funds are used to subsidize these activities, they are excluded from this calculation.

  6. Determinations

    1. The Associate Vice President for Plant Services (AVPPS) is responsible by July of each year for:

      1. Verifying and/or adjusting the basis for calculating monthly charges to Intercollegiate Athletics, Residence Halls, Housing Services, University Center, Central Food Facilities and any other large consumer which may come on line.

      2. Reviewing, in coordination with the Associate Vice President for Business Affairs and Comptroller (AVPBAC) and the Director of Accounting Services, the procedures to be used for calculating monthly rates for manufactured utilities to ensure recovery of operating costs, coverage of debt service and provision for major repair and replacement;

      3. Estimating a yearly dollar per net square foot cost for all utilities for the second ensuing fiscal year which will be used to make budget estimates and bill charges (i.e. establish estimated cost for FY 96 by July 1, 1994).

      4. Reviewing the yearly cost figure previously established for billing charges for the ensuing fiscal year and validating or revising it (i.e. validate or revise figure to use for FY 96 by July 1, 1995); and

      5. Ensuring that the Director of Maintenance and Utilities accomplishes the required billings using the data developed from sections 2.f.(1)(a) above and 2.f.(2)(a) below.

    2. The DAS is responsible by August 10 of each year for:

      1. Verifying and/or adjusting the status of all activities to be charged, except those covered by section 2.f.(1)(a) above.

      2. Providing these data to the AVPPS for billing purposes; and

      3. Updating the attachment yearly.

    3. List of Activities Currently Charged

      Activities currently charged for utilities are listed in Attachment A. This OP is not applicable to charges for utilities billed to University Medical Center.

ATTACHMENT