Cal. Code Regs. tit. 17 § 58875

Current through Register 2024 Notice Reg. No. 40, October 4, 2024

Section 58875 - Non-Allowable Costs

(a) The historical period shall not contain costs that are start-up costs, such as security deposits, moving expenses.

(b) The value of private donations or grants for rent, goods, services, assets, or staff shall not be reported either as an indirect expense or a recovery. The value of private donations shall be reported as income, the expense for which the donation was used shall be reported as a direct expense, when applicable, or as an item on the Work Activity Program Cost Statement -- Revenue and Expenses Statement Reconciliation, Form DS 1950 (3/05) Tab F.

(c) The following expenses shall not be allowable for the purposes of establishing a historical rate:

(1) Bad debts of vendors;

(2) Bad debts to vendors;

(3) Donations from vendors to other parties;

(4) Sales discounts to other parties;

(5) Theft of materials, products, or assets;

(6) Federal and State tax penalties and interest;

(7) Breakage and spoilage of materials and products used in production only;

(8) Consumer stipends;

(9) Insurance to protect against ratesetting or funding decisions made by the Department;

(10) Losses from food service programs;

(11) Losses from sales of fixed assets;

(12) Other losses from business transactions or operations;

(13) Legal fees resulting from suits against the department or regional centers;

(14) All expenses related to the following in Work Activity Programs:

(A) Medical, psychological, and/or nursing services;

(B) Physical and/or occupational therapy services;

(C) Diagnostic laboratory or x-ray services;

(D) Dietary services;

(E) Pharmacy services;

(F) Speech pathology services;

(G) Audiological services;

(H) Prosthetics and/or orthotics fitting;

(I) Dentistry services;

(J) Optometric services;

(K) Camps, field trips, recreational or social activities;

(L) Expenses for payment to holding companies for items such as occupancy, equipment, and vehicles that exceed the expense that would have been incurred by the vendor if the holding company did not exist.

(d) It is not necessary to allocate unallowable expenses. These shall be reconciling items between the Expense Statement, Form DS 1950 (3/05) Tab D and the Revenue and Expense Statement Reconciliation, Form DS 1950 (3/05) Tab F.

Cal. Code Regs. Tit. 17, § 58875

1. New section filed 7-22-2004 as an emergency; operative 7-22-2004 (Register 2004, No. 30). A Certificate of Compliance must be transmitted to OAL by 11-19-2004 or emergency language will be repealed by operation of law on the following day.
2. Repealed by operation of Government Code section 11346.1(g) (Register 2004, No. 49).
3. New section refiled 11-29-2004 as an emergency; operative 11-29-2004 (Register 2004, No. 49). A Certificate of Compliance must be transmitted to OAL by 3-29-2005 or emergency language will be repealed by operation of law on the following day.
4. New section refiled 3-30-2005 as an emergency; operative 3-30-2005 (Register 2005, No. 13). A Certificate of Compliance must be transmitted to OAL by 7-28-2005 or emergency language will be repealed by operation of law on the following day.
5. Certificate of Compliance as to 3-30-2005 order, including amendment of subsections (b), (c)(8) and (d), transmitted to OAL 6-21-2005 and filed 8-1-2005; amendments operative 8-31-2005 (Register 2005, No. 31).

Note: Authority cited: Section 11152, Government Code; and Sections 4857.1, 4859(a) and 4866, Welfare and Institutions Code. Reference: Sections 4859 and 4861(b), Welfare and Institutions Code.