| Maximum Reasonable Costs - Rental vs. Purchase
Article 4, Part 8
4-8-1. FUND REIMBURSEMENT
The Fund will reimburse the lower of the cost to rent or purchase remediation
equipment. In most instances, the burden will be on the Fund Applicant to prove that
purchase was more economically feasible than leasing or renting the equipment, or to prove
that it was not possible to rent/lease the equipment, such that purchase was the only
option.
4-8-2. COMPARING RENTAL AND PURCHASE COSTS
When determining whether to rent or purchase equipment, all costs should be factored
into the decision, including operation and maintenance costs. If the prime contractor or
consultant leases its own equipment to the Applicant, no operation and maintenance costs
will be reimbursed.
Rental rates should factor in the following:
- purchase price of the equipment + markup, if applicable
- salvage value of the equipment
- expected economic life of the equipment (assumed to be 30 months unless manufacturer
states otherwise)
- cost of capital (interest)
4-8-3. PARTIAL REIMBURSEMENT
If a Fund Applicant purchases remediation equipment and uses it for only a few months,
the Fund may reimburse only a portion of the purchase price, adjusted to factor in the
economic life of the equipment and the number of months the equipment was used at the
remediation site.
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