Self-Supporting Recharge Operations - Glossary of Terms

University of California Davis Self-Supporting Recharge Operations - Glossary Of Terms

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Administrative Support Costs (Overhead)

Costs not directly tied to a specific service but are necessary to run the overall operation. These costs are split amongst all services.

Allowable Costs

Cost that must be incurred to deliver a service. Allowable costs must be necessary, reasonable, and allocable.

Base Rate

What it costs the recharge operation to perform a service.

Base Rate = Total Allowable Costs / Estimated Total Volume

Direct Costs

Expenses that directly and consistently trace back to the services and rates offered a recharge operation.

External Customers

Any individuals or organizations not using university funds to pay for a recharge service.

External Rate

The rate a recharge operation charges external customers. The external rate is equal to the base rate plus costs associated with facilities and administrative costs (F&A).

External Rate = Base Rate + NUD


Fees received from external customers for services performed.

Institutional Recharge Operation

A recharge operation that services the entire campus or a large part of it.

Internal Customers

Customers that use funds that come through the university.

Internal Rate

The rate a recharge operation charges internal customers. The internal rate is equal to the base cost of the service.


An amount that can be added to external rates. Typically used to bring a rate close to market rates.

Non-University Differential (NUD)

The amount added to a base rate when calculating external customer rates. This amount covers F&A costs.

Operating Costs

The ongoing expenses incurred from running your recharge business,

Operational Subsidy

A predetermined sum of money granted by the university, a department, or government to assist a recharge operation that the price of a good or service may remain low or competitive. An operational subsidy covers all internal recharge customers.

Rate Methodology

The unit of measurement a recharge operation uses to charge for its services. For example, per hour, per service performed, and flat rates.

Recharge Operation

An activity funded by the income it generates from the goods and services it offers.


Fees received from internal customers for services performed.

Service Center

A recharge operation that provides a specific service to a targeted customer base.

Specialized Service Facilities

Service a very specific function and typically have support costs and revenue in excess of one million dollars per year.

User Subsidy

A predetermined sum of money granted by the university, a department, or government to reduce a rate for an individual, a specific customer group, service, or product line.