Section 56908 - Allowable Costs(a) In order to propose rates of reimbursement, the Department shall include in the facility cost study only those costs which are: (1) Directly related to the operation of the facility;(2) Recognized as an allowable business expense in accordance with federal and state income tax guidelines and reported as such on the residential service provider's state and federal tax returns for the data year of the cost study; and(3) As otherwise specified in subsection (b) below. In the event of inconsistencies between state and federal tax reporting guidelines, the California State Franchise Tax Board requirements shall prevail for the purpose of data collection for the cost study.(b) In order for the Department to conduct the cost study in accordance with state law, it is necessary for the Department to organize the data collected for the cost study in a manner not entirely consistent with state and federal tax reporting formats. The Department shall organize its cost study and include the following cost items if they are allowable business expenses consistent with subsections (a)(1) and (2) above and are incurred by the residential service provider and necessary for the operation of the facility. The cost components presented under each cost item are presented only as examples of allowable costs and are not intended to be exclusive.(1) Staff wages and fringe benefits which include the following cost components: (A) Expenditures for wages and salaries paid to all facility employees performing housekeeping, direct care, administration and management, staff supervision, clerical, accounting/bookkeeping, maintenance and repair functions;(B) Expenditures for fringe benefits including the residential service provider's share of Old Age Security Disability Insurance (OASDI), Workers' Compensation, Unemployment Insurance, Employment Training Tax, health insurance, dental insurance, vision insurance, life insurance, disability insurance, and retirement.(2) Housing expenses which include the following cost components:(A) Rent or lease for the facility building;(B) Depreciation and interest for the facility building, additions and mandated or other capital and leasehold improvements; and(3) Furniture and equipment expenses which include the following cost components:(A) Rent or lease payments; and(B) Depreciation and interest.(4) Insurance expenses which include the following cost components:(A) Property insurance, including fire, theft and earthquake;(C) General liability insurance, including malpractice and professional liability;(D) Director's and officer's liability insurance; and(5) Utilities expenses which include the following cost components: (A) Energy including gas, electricity, wood, coal, and oil;(D) Garbage and refuse disposal.(6) Food expenses which include the following cost components: (A) Groceries for food prepared at home for occupants; and(B) Restaurant meals for residents and the facility staff who accompany them.(7) Expenses for housekeeping supplies and services including the following cost components: (A) Housekeeping, cleaning, paper products, and maintenance supplies; and(B) Payments to external housekeeping or laundry services.(8) Clothing and personal care expenses, which are not purchased with a resident's personal and incidental allowance funds, and which include the following cost components: (A) Resident clothing, toiletries, and other personal items; and(B) Over-the-counter medications and prescriptions.(9) Transportation expenses which include the following cost components:(A) Costs of the facility vehicle, including:1. Rental and lease payments;2. Depreciation and interest;5. Maintenance and repair; and(B) Public transportation fares including bus, light rail, and taxi; and(C) Staff travel expenses while on facility business.(10) Program supply expenses for resident use or for the care or training of residents.(11) Consultant expense for activities pursuant to Section 56040(a).(12) Other professional consultant expenses including: (A) The costs of legal, accounting, clerical, or managerial services not provided by facility staff; and(B) Consultants other than those required by Section 56040(a).(13) Facility repair and maintenance expenses including the following cost components: (A) Materials and supplies; and(B) Contract labor for maintenance or repair of the facility, furniture, and equipment.(14) General and administrative expenses including the following cost components: (A) Dues/Subscriptions which shall include: 1. Dues for professional organizations related to residential care;2. Subscriptions for publications which are used in the operation of the facility, for residents, or for the purpose of staff development.(B) Business taxes that must be paid as a condition of operating a facility, excluding property taxes, business income taxes and personal income taxes;(C) Fees for licenses, certifications, registrations, or permits required in order to operate a community care facility providing residential care;(D) Staff recruitment and other personnel costs including advertising, charges and fees for screening prospective employees, such as fingerprinting, driving record checks performed by the Department of Motor Vehicles, and physical examinations or other health and safety checks required prior to employment; costs for inoculations or clinical tests of employees for the health and safety of staff or consumers;(E) Staff training expenses related to the requirements of Sections 56036 through 56038;(F) Communications expenses including telephone charges and long distance charges related to facility business, postage, telegraph, teletype, centrex, telepak, message services, facsimiles, and TDD; and(G) Office supplies including paper products, pens, typewriter, computer, printer and other equipment and supplies.Cal. Code Regs. Tit. 17, § 56908
1. New section filed 1-14-91; operative 2-13-91 (Register 91, No. 14).
2. Amendment of section filed 9-20-93 as an emergency; operative 9-20-93. Submitted to OAL for printing only pursuant to Chapter 722, Statutes of 1992, Section 147 (Register 93, No. 39). These regulations shall not be repealed by the Office of Administrative Law and shall remain in effect until revised or repealed, as appropriate.
3. Amendment of subsection (b)(14)(D) filed 11-23-94; operative 11-23-94 (Register 94, No. 47).
4. Editorial correction of HISTORY 2 (Register 94, No. 47).
5. Editorial correction of subsections (b)(11) and (b)(14)(E) (Register 95, No. 18).
6. Change without regulatory effect amending subsections (a)(3) and (b) filed 6-19-95 pursuant to section 100, title 1, California Code of Regulations (Register 95, No. 25). Note: Authority cited: Sections 4681.1 and 4791(i), Welfare and Institutions Code; Chapter 722, Statutes of 1992, Section 147. Reference: Sections 4681.1 and 4791(i), Welfare and Institutions Code.
1. New section filed 1-14-91; operative 2-13-91 (Register 91, No. 14).
2. Amendment of section filed 9-20-93 as an emergency; operative 9-20-93. Submitted to OAL for printing only pursuant to Chapter 722, Statutes of 1992, Section 147 (Register 93, No. 39). These regulations shall not be repealed by the Office of Administrative Law and shall remain in effect until revised or repealed, as appropriate.
3. Amendment of subsection (b)(14)(D) filed 11-23-94; operative 11-23-94 (Register 94, No. 47).
4. Editorial correction of History 2 (Register 94, No. 47).
5. Editorial correction of subsections (b)(11) and (b)(14)(E) (Register 95, No. 18).
6. Change without regulatory effect amending subsections (a)(3) and (b) filed 6-19-95 pursuant to section 100, title 1, California Code of Regulations (Register 95, No. 25).