Common use of Other Operating Costs Clause in Contracts

Other Operating Costs. Other operating costs such as water, fuel and oil, electricity or gas should be borne by the renter, either directly or indirectly through the overall rental charge. The most accurate method is to actually measure consumption of fuel or other energy, perhaps through a separate meter. The total of all ownership and operating costs can be used to estimate a rental charge for the whole year or portion of the year. If a structure or piece of equipment is rented for less than a full year or peak season the annual ownership cost estimates should be reduced proportionately. Or the total can be divided by a typical annual production level to estimate a charge per unit of production or use. Keep in mind that many structures may not attract sufficient rent to pay for all ownership and operating costs, due to their fixed location or a low demand for their services.