(a) The term reasonable cost as used in section 3(m) of the Act is
hereby determined to be not more than the actual cost to the employer of
the board, lodging, or other facilities customarily furnished by him to
his employees.
(b) Reasonable cost does not include a profit to the employer or to
any affiliated person.
(c) Except whenever any determination made under Sec. 531.4 is
applicable, the ``reasonable cost'' to the employer of furnishing the
employee with board, lodging, or other facilities (including housing) is
the cost of operation and maintenance including adequate depreciation
plus a reasonable allowance (not more than 5 1/2 percent) for interest
on the depreciated amount of capital invested by the employer: Provided,
That if the total so computed is more than the fair rental value (or the
fair price of the commodities or facilities offered for sale), the fair
rental value (or the fair price of the commodities or facilities offered
for sale) shall be the reasonable cost. The cost of operation and
maintenance, the rate of depreciation, and the depreciated amount of
capital invested by the employer shall be those arrived at under good
accounting practices. As used in this paragraph, the term ``good
accounting practices'' does not include accounting practices which have
been rejected by the Internal Revenue Service for tax purposes, and the
term ``depreciation'' includes obsolescence.
(d)(1) The cost of furnishing ``facilities'' found by the
Administrator to be primarily for the benefit or convenience of the
employer will not be recognized as reasonable and may not therefore be
included in computing wages.
(2) The following is a list of facilities found by the Administrator
to be primarily for the benefit of convenience of the employer. The list
is intended to be illustrative rather than exclusive: (i)
Tools of the trade and other materials and services incidental to
carrying on the employer's business; (ii) the cost of any construction
by and for the employer; (iii) the cost of uniforms and of their
laundering, where the nature of the business requires the employee to
wear a uniform.