# Title 7

## SECTION 51.38

### 51.38 Basis for fees and rates.

§ 51.38 Basis for fees and rates.(a) For each calendar year, AMS will calculate the rate for services, per hour per program employee using the following formulas:

(1) *Regular rate.* The total AMS inspection program
personnel direct pay divided by direct hours, which is then
multiplied by the next year's percentage of cost of living
increase, plus the benefits rate, plus the operating rate, plus the
allowance for bad debt rate. If applicable, travel expenses may
also be added to the cost of providing the service.

(2) *Overtime rate.* The total AMS inspection program
personnel direct pay divided by direct hours, which is then
multiplied by the next year's percentage of cost of living increase
and then multiplied by 1.5 plus the benefits rate, plus the
operating rate, plus an allowance for bad debt. If applicable,
travel expenses may also be added to the cost of providing the
service.

(3) *Holiday rate.* The total AMS inspection program
personnel direct pay divided by direct hours which is then
multiplied by the next year's percentage of cost of living increase
and then multiplied by 2, plus benefits rate, plus the operating
rate, plus an allowance for bad debt. If applicable, travel
expenses may also be added to the cost of providing the
service.

(b)(1) For each calendar year, based on previous fiscal year/historical actual costs, AMS will calculate the benefits, operating, and allowance for bad debt components of the regular, overtime and holiday rates as follows:

(i) *Benefits rate.* The total AMS inspection program
direct benefits costs divided by the total hours (regular,
overtime, and holiday) worked, which is then multiplied by the next
calendar year's percentage cost of living increase. Some examples
of direct benefits are health insurance, retirement, life
insurance, and Thrift Savings Plan (TSP) retirement basic and
matching contributions.

(ii) *Operating rate.* The total AMS inspection program
operating costs divided by total hours (regular, overtime, and
holiday) worked, which is then multiplied by the percentage of
inflation.

(iii) *Allowance for bad debt rate.* Total allowance for
bad debt divided by total hours (regular, overtime, and holiday)
worked.

(2) The calendar year cost of living expenses and percentage of inflation factors used in the formulas in this section are based on the most recent Office of Management and Budget's Presidential Economic Assumptions.

(c) When an inspection is delayed because product is not available or readily accessible, a charge for waiting time shall be determined using the formulas in this section.

[79 FR 67320, Nov. 13, 2014]