Common use of Steps Involved in Cost Allocation Clause in Contracts

Steps Involved in Cost Allocation. Portland will use the following sequence to allocate costs and to develop the wholesale volume rate. 1. Assign all system costs to categories reflective of the functions of Portland water system. Assign the functional categories to the appropriate Cost Pools as described in Section 6F. 2. Allocate the costs for each functional category in each Cost Pool to relevant Cost Components as described in Section 6G in accordance with the Base Extra- Capacity method. 3. Determine the unit costs for each Cost Component in each Cost Pool expressed as a dollar per applicable unit of service.