[Federal Register: March 15, 2006 (Volume 71, Number 50)]
[Notices]
[Page 13356-13357]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr15mr06-51]
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DEPARTMENT OF COMMERCE
National Oceanic and Atmospheric Administration
Notice of Indirect Cost Rates for the Damage Assessment and
Restoration Program for Fiscal Year 2004
AGENCY: National Oceanic and Atmospheric Administration (NOAA),
Commerce.
ACTION: Notice of indirect cost rates for the Damage Assessment and
Restoration Program for Fiscal Year 2004.
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SUMMARY: The National Oceanic and Atmospheric Administration's (NOAA's)
Damage and Restoration Program (DARP) is announcing new indirect cost
rates on the recovery of indirect costs for its component organizations
involved in natural resource damage assessment and restoration
activities for fiscal year (FY) 2004. The indirect cost rates for this
fiscal year and dates of implementation are provided in this notice.
More information on these rates and the DARP policy can be found at the
DARP Web site at http://www.darp.noaa.gov.
FOR FURTHER INFORMATION CONTACT: Brian Julius at 301-713-3038, ext.
199, by fax at 301-713-4387, or e-mail at Brian.Julius@noaa.gov.
SUPPLEMENTARY INFORMATION: The mission of the DARP is to restore
natural resource injuries caused by releases of hazardous substances or
oil under the Comprehensive Environmental Response, Compensation, and
Liability Act (CERCLA) (42 U.S.C. 96012 et seq.), the Oil Pollution Act
of 1990 (OPA) (33 U.S.C. 2701 et seq.), and support restoration of
physical injuries to National Marine Sanctuary resources under the
National Marine Sanctuaries Act (NMSA) (16 U.S.C. 1431 et seq.). The
DARP consists of three component organizations: the Damage Assessment
Center (DAC) within the National Ocean Service; the Restoration Center
within the National Marine Fisheries Service; and the Office of the
General Counsel for Natural Resources (GCNR). The DARP conducts Natural
Resource Damage Assessments (NRDAs) as a basis for recovering damages
from responsible parties, and uses the funds recovered to restore
injured natural resources. During FY 2005, the DARP expanded to include
a fourth component organization, the Coastal Protection and Restoration
Division (CPRD) within the National Ocean Service. With this addition,
DARP changed its name to the Damage Assessment, Remediation, and
Restoration Program (DARRP). Since this notice announces the indirect
cost rates for FY 2004, which is prior to DARP's expansion, the acronym
``DARP'' will be used throughout.
Consistent with Federal accounting requirements, the DARP is
required to account for and report the full costs of its programs and
activities. Further, the DARP is authorized by law to recover
reasonable costs of damage assessment and restoration activities under
CERCLA, OPA, and the NMSA. Within the constraints of these legal
provisions and their regulatory applications, the DARP has the
discretion to develop indirect cost rates for its component
organizations and formulate policies on the recovery of indirect cost
rates subject to its requirements.
The DARP's Indirect Cost Effort
In December 1998, the DARP hired the public accounting firm Rubino
& McGeehin, Chartered (R&M) to: evaluate cost accounting system and
allocation practices; recommend the appropriate indirect cost
allocation methodology; and determine the indirect cost rates for the
three organizations that comprise the DARP. A Federal Register notice
on R&M's effort, their assessment of the DARP's cost accounting system
and practice, and their determination regarding the most appropriate
indirect cost methodology and rates for FYs 1993 through 1999 was
published on December 7, 2000 (65 FR 76611). The notice and report by
R&M can also be found on the DARP Web site at http://www.darp.noaa.gov.
R&M continued its assessment of DARP's indirect cost rate system
and structure for FYs 2000 and 2001. A second Federal notice specifying
the DARP indirect rates for FYs 2000 and 2001 was published on December
2, 2002 (67 FR 71537).
In October 2002, DARP hired the accounting firm of Cotton and
Company LLP (Cotton) to review and certify DARP costs incurred on cases
for purposes of cost recovery and to develop indirect rates for FY 2002
and subsequent years. As in the prior years, Cotton concluded that the
cost accounting system and allocation practices of the DARP component
organizations are consistent with Federal accounting requirements.
Consistent with R&M's previous analyses, Cotton also determined that
the most appropriate indirect allocation method continues to be the
Direct Labor Cost Base for all three DARP component organizations. The
Direct Labor Cost Base is computed by allocating total indirect cost
over the us of direct labor dollars plus the application of NOAA's
leave surcharge and benefits rates to direct labor. Direct labor costs
for contractors from the Oak Ridge Institute for Science and Education
(ORISE) and I.M. Systems Group (IMSG) also were included in the direct
labor base because Cotton determined that these costs have the same
relationship to the indirect cost pool as NOAA direct labor costs.
ORISE and IMSG provide on-site support to the DARP in the areas of
injury assessment, natural resource economics, restoration planning and
implementation, and policy analysis. A third Federal notice specifying
the DARP indirect rates for FY 2002 was published on October 6, 2003
(68 FR
[[Page 13357]]
57672), and a fourth notice fore the FY 2003 indirect cost rates
appeared on May 20, 2005 (70 FR 29280). Cotton's reports on these
indirect rates can also be found on the DARP Web site at http://www.darp.noaa.gov
.
Cotton reaffirmed that the Direct Labor Cost Base is the most
appropriate indirect allocation method for the development of the FY
2004 indirect cost rates.
The DARP's Indirect Cost Rates and Policies
The DARP will apply the indirect cost rates fro FY 2004 as
recommended by Cotton for each of the DARP component organizations as
provided in the following table:
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FY 2004
DARP component organization indirect rate
(percent)
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Damage Assessment Center (DAC).......................... 213.03
Restoration Center (RC)................................. 181.46
General Counsel for Natural Resources (GCNR)............ 165.39
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These rates are based on the Direct Labor Cost Base allocation
methodology.
The FY 2004 rates will be applied to all damage assessment and
restoration case costs incurred between October 1, 2003 and September
30, 2004. DARP will use the FY 2004 indirect cost rates for future
fiscal years until subsequent year-specific rates can be developed.
For cases that have settled and for cost claims paid prior to the
effective date of the fiscal year in question, the DARP will not re-
open any resolved matters for the purpose of applying the revised rates
in this policy for these fiscal years. For cases not settled and cost
claims not paid prior to the effective date of the fiscal year in
question, costs will be recalculated using the revised rates in this
policy for these fiscal years. Where a responsible party has agreed to
pay costs using previous year's indirect rates, but has not yet made
the payment because the settlement documents are not finalized, the
costs will not be recalculated.
The DARP indirect cost rate polices and procedures published in the
Federal Register on December 7, 2000 (65 FR 76611), on December 2, 2002
(67 FR 71537), October 6, 2003 (68 FR 57672), and May 20, 2005 (70 FR
29280) remain in effect except as updated by this notice.
Dated: March 9, 2006.
David M. Kennedy,
Director, Office of Response and Restoration, National Ocean Service,
National Oceanic and Atmospheric Administration.
[FR Doc. 06-2477 Filed 3-14-06; 8:45 am]
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