Agreements Cost Estimates Steven J Robinson Acting Director

Agreements & Cost Estimates Steven J. Robinson Acting Director Utility & RR, INDOT June 8, 2016

Objectives n Reimbursement n n n Agreements n n n Parametric Estimates Developing Estimates Detailed Estimates Invoices & Invoicing n n Filling out an Agreement Reviewing an Agreement Extraordinary Cost Agreement Cost Estimates n n Grounds for Reimbursement & the Appropriate Agreements Partial Reimbursement Reviewing an Invoice Itemized Cumulative Invoice Sample Invoice References

Reimbursement & Agreements

Reimbursable Positions n Reimbursable Positions should be determined by Stage 1 n A summary page should be drafted n n n Include all utilities seeking reimbursement Grounds for reimbursement Further explanation of their situation Submitted to Project Manager & State Director of Utilities at Stage 1 Clarifies who has a qualified interest early in the project Any disputes can be cleared well in advance of letting

Partial Reimbursement n n A utility may be partially reimbursable for a project Different options to split the cost n n Percentage of overall cost Precise breakdown Should be noted in the agreement Percentage is most appropriate for relatively uniform facilities n Example: 700 LF of a 1000 LF line is in a private easement n n n 70% reimbursable from the total cost of the relocation Includes overhead, equipment, etc. Precise Method works best for non-uniform facilities n Example: Same as above except the last 500 LF is a larger pipe n n n The first 700 LF are 100% reimbursable The last 300 LF are excluded The overhead, equipment, etc. , can be split 70%-30%

Partial Reimbursement n Precise method works best for non-uniform facilities n Example: Same as above except the last 500 LF is a larger pipe n n n The first 700 LF are 100% reimbursable, less betterment The last 300 LF are excluded The overhead, equipment, etc. can be split 70%-30%

Types of Agreements § INDOT employees can access all current agreements from the UTA § Consultants may request a copy of the correct agreement from their Oversight Agent or request access to the UTA § Work may be by Utility or by INDOT n General Agreements n n n n Preliminary Engineering Standard Extraordinary Cost Unnecessary Cost Addenda to Agreements LPA Utility Agreements Utility-Specific Agreements

Example Agreement – Prep

Agreements – Exhibits n Agreements generally have two exhibits: n Exhibit A – Signed & Approved Workplan n Prioritize reimbursable utilities when planning coordination Exhibit B – Itemized Cost Estimate All pages should be numbered, i. e. Exhibit A – 1 of 4

Example Agreement – Review

Example Agreement - Review

Extraordinary Cost Agreements n EC Agreements require additional approval before proceeding with development n n n n Extraordinary Cost Request Internal Memo prepared by Oversight Agent Exhibit A – Copy of the SPMS Schedule Exhibit B – Letter from utility requesting hardship Exhibit C – Revenues from the previous calendar year Exhibit D – Itemized Cost Estimate Exhibit E – Workplan Generally, include the work in the contract

Extraordinary Cost Agreements n Cost Split n n n Utility is responsible for at least 10% of its gross annual revenue PE & CE costs may be deducted from its share INDOT is responsible for the remainder of the estimated cost

Example Agreement – Ex. Cost

Reimbursement & Agreements n n n n There must be a clear conflict between the INDOT Project and the utility’s facilities Betterment of utility facilities is not reimbursable Original signed hardcopy must be sent to CO for approval & execution Ensure the address on the front page is the Utility's remit to address Ensure all exhibits are correctly labeled and numbered Flag the signature pages before sending to CO Affix a Memo & Routing Slip to the front of the packet LPA stands in for the State Transportation Department (STD) in regards to all FHWA Requirements

Cost Estimates

Cost Estimates Parametric Estimate n n n Used to populate a basic amount of money when a project is initially developed Does not take any site/utility conditions into consideration The project manager can decline these recommendations Non-Interstate n Rural 5% 10% Urban 10% 15% Example: n n n Interstate State Road 256 in Austin Estimated Project Cost: $315, 000 Utility Estimate: $31, 500

Cost Estimates n Ballpark Estimate: n Submitted by the utility with its initial notice response n n n Educated Guess Specific to the project Based on initial anticipated accommodation Can be as simple as a cost per foot x length Refined as the project develops n n As more is known about the relocations Develops towards a detailed estimate

Cost Estimates n Detailed Estimate: n n Submitted by Reimbursable Utilities May be refined multiple times Preferably formatted similarly to an invoice Contingencies are not accepted by FHWA n Labor n n Materials n n Salvage Transportation Equipment Overhead n n n Surcharge Preliminary Engineering Construction Engineering Inspections Legal Fees Betterment

Cost Estimates n Credits: n Salvage n n n Materials that can be returned to stock at current market value Proceeds from sale of materials can be credited to the project Betterment n n Definition: Wholly at the election and for the benefit of the utility Methods of calculation: n n n Determined to be a percentage of the total cost Precise itemization Exceptions: n n n Required by the project Equivalent standards Next highest grade/size for obsolete materials Required by government law or regulatory commission code Current utility design practices & there is a direct benefit to the highway project

Cost Estimates n Non-Participating Items: The following items are not reimbursable with federal money n External Relations n Marketing n n n Research Programs Returns on Investments n n n n Lobbying AFUDC (Allowance for Funds Used During Construction) Interest Financing Costs Float (Considered to be interest) Capital Stock Tax Contingencies In the event of conflicting policies, we follow FHWA guidelines

Cost Estimates – Sample

Invoices & Invoicing

Reviewing an Invoice n A good invoice should include three components n The Bill Single Page Letter Utility Name Remit to Address Invoice Number Date of Invoice Start & End Dates Project & Permit Information Purchase Order Number Utility Representative Contact Information Summary of Charges n n n The Supporting Documentation n Work Logs Contractor Invoices Receipts The Ledger n n n n Cost Item ID Cost Item Category Date cost was incurred Name of Contractor Type of goods or services Rate for each unit of goods or services Number of units of the goods or services Total Cost of the goods or services

Itemized Cumulative Invoice n n The Final Bill Summary listing of the charges for the entire project n n n Can be compared directly to estimate n n Should use the same categories as the ledgers Include a total amount due Facilitate an explanation of cost overruns Must be submitted within 90 days of utility work complete per the agreement

Example Invoice

Example Ledger

References n For More Information n IC 8 -23 -2 -6 n n FHWA 23 CFR 645, Subpart A n n http: //www. fhwa. dot. gov/reports/utilguid/ Commentary Appendix A – Legal Code INDOT Utility Coordination Website n n http: //www. fhwa. dot. gov/reports/utilguid/ http: //www. in. gov/indot/2389. htm Indiana Design Manual: Chapter 104 n http: //www. in. gov/indot/design_manual/files/Ch 104_2013. pdf

Questions?