US embassy cable - 01ABUJA965

UNCLAS ABUJA 000965 
 
SIPDIS 
 
 
A/OPR/ALS FOR THURMAN, WARD/WHITE 
A/OPR/CR FOR ANNIE DICKSON 
 
 
E.O. 12958: N/A 
TAGS: ALOW, AMGT, APER, NI 
SUBJECT:  BUSING IN ABUJA 
 
Refs: State 42908 
 
 
1.  In response to reftel, Post presents its cost-breakdown 
for the school bus service offered by the American 
Employees' Association of Abuja (AEAA).  Section 273 states 
that school transportation costs may be granted based on an 
acceptable documentation of the actual costs.  Reftel also 
states that the "primary criterion to determine if a fee or 
charge is allowable or not is to ask whether the service is 
normally provided free of charge in the Unites States 
public school system." 
 
 
2.  Any reasonable fee charged by a private entity (school 
bus company) to a public entity (school district) reflects 
overhead costs, either explicitly or implicitly.  Post 
confirms that AEAA's overhead costs are legitimate.  The 
Department enters into contracts frequently that include 
specific provisions for payment of overhead.  Since 
submitting its last cost breakdown, AEAA's position has 
changed materially in that the Embassy has agreed to 
provide a small office at a nominal fee.  Accordingly, the 
cost associated with office expenses has been deleted. 
 
 
3.  The greatest round-trip mileage on the route is eight 
miles.  Please find below an updated annualized cost 
breakdown for Abuja's bus service which reflects these 
changes: 
 
 
Vehicle Costs    4,800 
Base Radio     400 
Insurance     4,200 
Fuel      2,000 
Maintenance    2,000 
FSN Driver:    3,500 
U.S. Manager:    2,000 
Service Charge:   1,900 
 
 
Total annual costs:   $20,800 
 
 
4.  The Association has been providing transportation 
services to nine eligible dependents of direct-hire 
Americans since January, 2001. This works out to a $2200 
annual charge for bus transportation.  Invoices totaling 
$1,100 per child have been delivered to parents of school 
children using the bus for the Spring semester, 2001. 
JETER