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(2) "Idle facilities" means completely unused facilities that are excess to the governmental unit's <br />current needs. <br /> (3) "Idle capacity" means the unused capacity of partially used facilities. It is the difference <br />between: (a) that which a facility could achieve under 100 percent operating time on a one-shift <br />basis less operating interruptions resulting from time lost for repairs, setups, unsatisfactory <br />materials, and other normal delays; and (b) the extent to which the facility was actually used to <br />meet demands during the accounting period. A multi-shift basis should be used if it can be <br />shown that this amount of usage would normally be expected for the type of facility involved. <br /> (4) "Cost of idle facilities or idle capacity" means costs such as maintenance, repair, housing, <br />rent, and other related costs, e.g., insurance, interest, property taxes and depreciation or use <br />allowances. <br /> b. The costs of idle facilities are unallowable except to the extent that: <br /> (1) They are necessary to meet fluctuations in workload; or <br /> (2) Although not necessary to meet fluctuations in workload, they were necessary when <br />acquired and are now idle because of changes in program requirements, efforts to achieve more <br />economical operations, reorganization, termination, or other causes which could not have been <br />reasonably foreseen. Under the exception stated in this subsection, costs of idle facilities are <br />allowable for a reasonable period of time, ordinarily not to exceed one year, depending on the <br />initiative taken to use, lease, or dispose of such facilities. <br /> c. The costs of idle capacity are normal costs of doing business and are a factor in the normal <br />fluctuations of usage or indirect cost rates from period to period. Such costs are allowable, <br />provided that the capacity is reasonably anticipated to be necessary or was originally reasonable <br />and is not subject to reduction or elimination by use on other Federal awards, subletting, renting, <br />or sale, in accordance with sound business, economic, or security practices. Widespread idle <br />capacity throughout an entire facility or among a group of assets having substantially the same <br />function may be considered idle facilities. <br />22.Insurance and indemnification. <br />a. Costs of insurance required or approved and maintained, pursuant to the Federal award, are <br />allowable. <br />b. Costs of other insurance in connection with the general conduct of activities are allowable <br />subject to the following limitations: <br />(1) Types and extent and cost of coverage are in accordance with the governmental unit's policy <br />and sound business practice. <br />(2) Costs of insurance or of contributions to any reserve covering the risk of loss of, or damage <br />29 <br /> <br />