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FF- r7 JAN 18-1994 BwK 5 Piiz by management that computed the cost for the four major components of the new plant. Intervener white wished to know what "Miscellaneous Plant" is, and Mr. Olstein stated that he would defer to the engineer. It is simply a variety of things they could not fit into any other category. Mr. Olstein then reviewed Schedule 1, the Revenue Requirement calculation, explaining that it is simply the sum of operating costs, the depreciation of the new plant, and the estimated depreciation on the old plant that will be in service when the new plant is built. It also includes depreciation on CIAC only for those portions that will still be in use. Chairman Scurlock commented that in Schedule 3 - General and Administrative Services salaries have been significantly reduced, the president's salary being $10,000 as opposed to $64,000 previously. Mr. Olstein pointed out that the previous number included other than just the president's salary. He stated that he did not take a detailed look at the previous costs, but he did not feel it is a secret that a lot of costs were mislabeled. Mr. Olstein then went into their rationale for the inclusion of depreciation on CIRC, citing Sarasota County vs. Tamaron Utilities. He explained that basically it is a fairly common practice in Florida for developers to turn over a utility to someone else to operate - as was the case here - and also you will find developers putting some money up front to assist in the building of the necessary _ infrastructure that is required to be able to build houses, and that also falls under the category CIRC. In addition the State of Florida is very specific that what they term an impact fee, which is a payment that is made solely for the right to join a system, is also considered to be a CIAC, and 45