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(2) Costs of assets that are idle during the grant year are not allowable costs.

(3) To the extent that such assets were acquired as a government grant, depreciation and use costs of assets are not allowable costs if the grantee, or a predecessor in interest to the grantee, acquired them in whole or in part with

(A) money granted by a state, federal, or municipal government or agency; or

(B) as a direct grant or donation from such a government or agency.

(4) Other depreciation or use costs of the grantee’s equity in such assets are allowable costs in amounts calculated under 7 AAC 53.945. (i) For the purposes of (a)(3) of this section, the department will classify costs of borrowing money as follows:

(1) Costs of borrowing money actually used for the purchase or repair of real property, equipment, or capital improvements used for delivering residential child care services are allowable costs, if the loan is secured by a security interest in the real property, equipment, or capital improvements.

(2) Interest costs for periods before the actual payment of the purchase price of realty, goods, or services are not allowable costs.

(3) Except in the case of the costs of the services of a real estate broker for real estate purchases, or the services of an attorney, costs of services rendered in negotiating a loan or the purchase or sale of an asset are not allowable costs. (j) For the purposes of (a)(3) of this section, the department will classify costs of fire insurance, general liability insurance, boiler insurance, and other property insurance as allowable costs. (k) For the purposes of (a)(3) of this section, the department will classify the costs of purchasing an item of equipment as an allowable cost if the total cost of purchasing the item is $5,000 or less. (l) For the purposes of (a)(3) of this section, the department will classify a cost that is not described in this section as an allowable cost only if the department approves the nature and the amount of the cost before the grantee incurs it. (m) For the purposes of (a)(3) of this section, costs described at AS 47.40.041(c) are not allowable costs. (Eff. 1/13/85, Register 93) Statutory Authority: