75-03-15-11. Related organization.

1. Costs applicable to services, facilities, and supplies furnished to a facility by a related organization may not exceed the lower of the costs to the related organization or the price of comparable services, facilities, or supplies purchased elsewhere primarily in the local market. The facility shall identify such related organizations and costs, and shall submit allocations with the requested financial record.

2. A facility may lease buildings or equipment from a related organization. In that case, the rent or lease expense paid to the lessor is allowable in an amount not to exceed the actual costs associated with the asset if the rental of the buildings or equipment is necessary to provide programs and services to residents. The actual costs associated with the asset are limited to depreciation, real estate taxes, property insurance, and plant operation expenses incurred by the lessor.

History: Effective November 1, 1985; amended effective March 1, 1999; June 1, 2004; July 1, 2014; October 1, 2021.

General Authority: NDCC 50-06-16, 50-11-03

Law Implemented: NDCC 50-06-05.1, 50-11-03.2