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Authority: AS 47.05.010 AS 47.40.011 AS 47.41.041 Editor’s note: A copy of the applicable portion of the State Administrative Manual cited in 7 AAC 53.941(f)(3) may be obtained from the office of the commissioner of the Department of Health and Social Services. 7 AAC 53.945. Depreciation and use allowance costs. (a) A grantee shall calculate depreciation costs of an asset starting with the date of the acquisition of the asset by the grantee, or by a related organization or related party, as appropriate. (b) A grantee shall calculate reimbursable depreciation and use allowance costs on a monthly basis. The department will reimburse a grantee only for that part of the allowable monthly depreciation cost of an asset that is proportionately equal to the grantee’s equity in the asset on the last day of a calendar month. For the purposes of this section, “the grantee’s equity in an asset” means the amount by which the basis of an asset, plus the basis of any capitalized improvements to the asset less accumulated depreciation of the asset and improvements to the asset, exceeds the total unpaid principal amount of any loans that were used to purchase the asset and make capitalized improvements, together with any loans for which the asset or improvements were used as collateral. (c) For each month, a grantee shall calculate any depreciation cost for the grantee’s equity in the asset using the straight-line method. In calculating depreciation, the grantee shall select an estimated useful life from those listed in this subsection. The grantee shall select the estimated useful life that corresponds most closely to the apparent actual useful life of the asset. Once a grantee has assigned a useful life to an asset, the grantee may not change the useful life in future grants.

(1) The permissible useful lives of equipment are

(A) three years;

(B) five years;

(C) 12 years; or

(D) 25 years.

(2) The permissible useful lives of vehicles are

(A) three years;