Loading (50 kb)...'
(continued)
Line 05—Constant Controls Capital Investment. Enter the estimated capital outlays for constant controls for the years during which outlays would be made. These values shall correspond to the constant control investment estimates shown in the supporting schedules for Line 17 of Schedule C.1. Changes in working capital investment due to investment in constant controls facilities may be added to the capital investment estimates shown in the supporting schedules for Schedule C.1.
Line 06—Sustaining Capital. Enter for each year the amounts reported in Schedule C.2, Line 07.
Line 07—Total. Enter for each year the sum of Lines 05 and 06.
Line 08—Net Cash Flow Projections. Enter for each year the difference between Lines 04 and 07.
Line 09—Discount Factors. Enter the discount factor for each year, computed as described in the instructions under Section 2.6.
Line 10—Present Value of Future Cash Flows. Enter for each year the product of Lines 08 and 09.
Line 11—Horizon Value. Enter under the Total column the estimated horizon value of the smelter reported in Schedule C.5, Line 16.
Line 12—Discount Factor. Enter under the Total column the appropriate discount factor, computed as described in the instructions under Section 2.6.
Line 13—Present Value of Horizon Value. Enter under the Total column the product of Lines 11 and 12.
Line 14—Present Value of Future Cash Flows. Enter under the Total column the sum of amounts previously reported on Line 10 for 1984 through 1990.
Line 15—Total Present Value. Enter the sum of Lines 13 and 14.
Line 16—Net Smelter Capital Investment in Constant Dollars. Enter under the Total column the amount reported in the second (Constant Dollar) column of Schedule C.3, Line 26 if the value is greater than zero. If the value is zero or less, enter zero.
Line 17—Net Present Value. Enter the difference between Lines 15 and 16. Applicants reporting a negative net present value will pass the Rate of Return Test.
Schedule C.5—Horizon Value of Cash Flows for the Rate of Return Test
General. The applicant should use Schedule C.5 to calculate the horizon value of net cash flow projections for the Rate of Return Test. This horizon value is used in Schedule C.4. The computation of the horizon value is different for this test than for the Profit Protection Test because this test requires the reporting of depreciation for tax purposes.
In Schedule C.5, the applicant removes the tax savings of constant controls depreciation from the cash flows for the last two forecast years. A depreciation-free horizon value is then calculated from these depreciation-free cash flows. The tax savings of constant controls depreciation during the horizon years are then calculated separately. The final horizon value is equal to the sum of the depreciation-free horizon value and the tax savings from depreciation of constant controls accruing over the horizon years. The line items in Schedule C.5 are explained in the following instructions.
Line 01—Net Cash Flow Projections. Enter for each of the final two forecast years the values in Schedule C.4, Line 08, for the corresponding years.
Line 02—Depreciation and Amortization. Enter for each of the final two forecast years the value in Schedule C.4, Line 02, for the corresponding years.
Line 03—Marginal Tax Rate. Enter for each of the final two forecast years the marginal income tax rate applicable to the smelter. This rate should incorporate both Federal and State tax liability.
Line 04—Tax Savings. Enter for each of the final two forecast years the product of Lines 02 and 03.
Line 05—Nominal Dollar Values. Enter for each of the final two forecast years the difference between Lines 01 and 04.
Line 06—1990 Dollar Values. For each of the final two forecast years the nominal dollar values must be expressed in the last forecast year's dollars (1990 dollars). Transfer the 1990 amount in Line 05 directly to Line 06. Inflate the 1989 amount to 1990 dollars using the forecast GNP price deflator.
Line 07—Average. Enter under the Total column the average of the two values in Line 06.
Line 08—Horizon Factor. Enter under the Total column the horizon factor provided in Section 2.7.
Line 09—Depreciation-free Horizon Value. Enter under the Total column the product of Lines 07 and 08.
Line 10—Depreciation and Amortization. Enter for each year of the horizon period depreciation charges associated with the smelter's investment in equipment and facilities related to pollution controls. These investments should include those actually made and those required to be made by the end of the forecast period. Reported charges should be computed in accordance with depreciation and amortization methods adopted for tax reporting purposes by the firm. Attach as part of Exhibit B supporting schedules consistent with those supporting Line 17 in Schedule C.1.
Line 11—Marginal Tax Rate. Enter for each year of the horizon period the marginal income tax rate applicable to the smelter. This rate should incorporate both Federal and State tax liability.
Line 12—Tax Savings. Enter for each year of the horizon period the product of Lines 10 and 11.
Line 13—Discount Factors. Enter the discount factor for each year of the horizon period. This shall be computed according to the instructions under Section 2.6, except that the variable N found in the discount factor formula represents the number of years in the future, counting from the last forecast year. For example, N=1 for the first year of the horizon period.
Line 14—Present Value of Tax Savings. Enter for each year of the horizon period the product of Lines 12 and 13.
Line 15—Total Present Value of Tax Savings. Enter under the Total column the sum of values on Line 14 for the horizon years.
Line 16—Horizon Value. Enter under the Total column the sum of Lines 09 and 15.
Schedule D.1—Interim Controls Revenue Forecast
General. Use Schedule D.1 to report annual forecasts of operating revenues anticipated during the years 1984 through 1990 from operation of the smelter applying for an interim controls waiver. The applicant applying for a permanent waiver should complete Schedule D.1 twice, with revenue and production projections based on two alternative assumptions: (1) Installation of interim constant control equipment, no installation of any additional SO2 controls that the smelter would otherwise be required to install but for the issuance of an NSO, and closure after January 1, 1988, and (2) installation of interim constant control equipment and any additional SO2 controls required to comply with the smelter's SIP emission limitation by January 2, 1988, so that the smelter will remain open through the horizon period. The applicant applying for a temporary waiver should use only the first assumption. For a smelter that has no continuous emission controls, the assumed interim control investment program should be based on the installation and operation of a well-designed sulfuric acid plant to treat all strong gas streams. For a smelter that already has some continuous emission controls, the assumed interim constant control investment should be based on the installation and operation of any additional acid plant capacity that would be necessary for treatment of all strong streams with interim constant controls. The interim controls projections should account for other regulatory requirements on the same basis as provided for in the NSO eligibility tests.
Forecast smelter revenues should be expressed on a tolling service equivalent basis as described in Section 2.3.4. The line items in Schedule D.1 are explained in the following instructions. Attach as part of Exhibit B schedules to (1) explain the methods used to make the required forecasts, (2) explain differences, if any, between historical trends and the forecasts, and (3) provide data and information to support the forecasts.
Lines 01 and 05—Concentrates Processed. Report for each year the forecast quantity of concentrates processed for unaffiliated parties (Line 01) and affiliated parties (Line 05).
Lines 02 and 06—Smelting Charge. Report for each year the forecast smelting charge for unaffiliated parties (Line 02) and affiliated parties (Line 06). See Section 2.4 for forecast copper smelting charges furnished by EPA.
Lines 03 and 07—Total Smelter Revenues. Report for each year the forecast total operating revenues derived from processing concentrates. The total for unaffiliated parties (Line 03) is equal to the product of Lines 01, 02, and 04, and for affiliated parties (Line 07), the product of Lines 05, 06, and 08.
Lines 04 and 08—Average Product Grade. Report for each year the forecast average quality rating assigned to concentrates processed for unaffiliated parties (Line 04) and affiliated parties (Line 08).
Line 09—Total Co-Product Revenues. Report for each year the forecast net revenues from sales of co-products derived from the smelter's operations. Attach as part of Exhibit B a schedule showing by individual type of co-product the forecast quantity produced and sold, forecast market price per unit of sales, and forecast total revenues derived from the co-product sales.
Line 10—Total By-product Revenues From Pollution Control Facilities. Report for each year forecast revenues from the sale of by-products derived from operation of the smelter's pollution control facilities. Attach as part of Exhibit B a schedule showing by type of by-product produced (e.g., sulfuric acid) the forecast quantity of output, forecast market price per unit of output sold, and forecast total revenue derived from the by-product sales.
Line 11—Total By-product Revenues From Other Smelter Processing. Report forecast revenues from the sales of gold, silver, and other by-products derived from the smelter's operations. Attach as part of Exhibit B a schedule providing additional documentation as specified in the instructions for Line 10.
Line 12—Total Co-product and By-product Revenues. Enter for each year the total of Lines 09 through 11.
Schedule D.2—Interim Controls Cost Forecast
General. Use Schedule D.2 to report annual forecasts of operating costs anticipated during the years 1984 through 1990 from operation of the smelter applying for an interim controls waiver. The applicant applying for a permanent waiver should complete Schedule D.2 twice, with cost and production projections based on two alternative assumptions: (1) Installation of interim constant control equipment, no installation of any additional SO2 controls that the smelter would otherwise be required to install but for the issuance of an NSO, and closure after January 1, 1988, and (2) installation of interim constant control equipment and any additional SO2 controls required to comply with the smelter's SIP emission limitation by January 2, 1988, so that the smelter will remain open through the horizon period. For a smelter that has no continuous emission controls, the assumed interim control investment program should be based on the installation and operation of a well-designed sulfuric acid plant to treat all strong gas streams. For a smelter that already has some continuous emission controls, the assumed interim constant control investment should be based on the installation and operation of any additional acid plant capacity that would be necessary for treatment of all strong streams with interim constant controls. The interim controls projections should account for other regulatory requirements on the same basis as provided for in the NSO eligibility tests.
The line items in Schedule D.2 are explained in the following instructions. Attach as part of Exhibit B schedules to (1) explain the methods used to make the required forecasts, (2) explain differences, if any, between historical trends and the forecasts, and (3) provide data and information to support the forecasts.
Line 01—Direct Labor Hours. Report for each year the quantity of direct labor hours required to support the processing levels previously reported. Attach as part of Exhibit B an explanation of the labor productivity factors involved.
Line 02—Average Hourly Wage Rate. Report for each year the forecast average wage rate per unit of direct labor input. Attach as part of Exhibit B a description of direct labor cost factors under any existing labor contracts that extend to the forecast period and an explanation of the methodology used to forecast wage rates. EPA-provided forecast wage indices are reported in Section 2.4.
Line 03—Total Wage Payments. Enter for each year the product of Lines 01 and 02.
Line 04—Supplemental Employee Benefits. Report for each year adjustments required to direct labor costs for other employee compensation under supplemental benefit plans. Attach as part of Exhibit B a description of such plans and their costs and an explanation of the methodology used to forecast such costs. EPA-provided forecast wage indices are reported in Section 2.4.
Line 05—Total Production Labor Costs. Enter for each year the total of Lines 03 and 04.
Lines 06, 09, 12, 15, and 18—Energy Quantities. Report for each year the quantity of energy by type required to support the processing levels reported in the smelter's revenue. Attach as part of Exhibit B an explanation of energy characteristics and use factors considered in forecasting the smelter's future energy requirements.
Lines 07, 10, 13, 16, and 19—Unit Prices. Report for each year the forecast price per unit of energy input by type of energy. Attach as part of Exhibit B a description of the energy price factors under any existing energy contracts that extend to the forecast period and an explanation of the methodology used to forecast unit energy prices. EPA-provided forecast energy indices are reported in Section 2.4.
Lines 08, 11, 14, 17, and 20—Total Payments. Enter for each year the products of quantity and prices paid for electricity (Lines 06×07), natural gas (Lines 09×10), coal (Lines 12×13), fuel oil (Lines 15×16), and other (Lines 18×19).
Line 21—Total Energy Costs. Enter for each year the total of Lines 08, 11, 14, 17, and 20.
Schedule D.3—Interim Controls Forecast Profit and Loss Summary
General. Use Schedule D.3 to report forecast revenue and cost information summed in Schedules D.1 and D.2 for the years 1984 through 1990. Applicants applying for a permanent waiver must complete Schedule D.3 twice. Forecast revenues and costs in Schedule D.3 shall be compatible with productive capacity and pollution control assumptions underlying the operating revenue and cost forecasts incorporated into each set of Schedules D.1 and D.2. Applicants applying for a temporary waiver should use only the first assumption: installation of interim constant control equipment and no installation of any additional SO2 controls that the smelter would otherwise be required to install but for the issuance of an NSO. The transfer of line items from Schedules D.1 and D.2 to this Schedule is explained in the following instructions.
Line 01—Smelter Revenues—Unaffiliated Parties. Enter the totals reported in Schedule D.1, Line 03.
Line 02—Smelter Revenues-Affiliated Parties. Enter the totals reported in Schedule D.1, Line 07.
Line 03—Co-product and By-product Sales Revenues. Enter the totals reported in Schedule D.1, Line 12.
Line 04—Other Operating Revenues. Report operating revenues anticipated from sources not accounted for under Lines 01 through 03. Refer to instructions for Line 04 of Schedule A.3 for items that should not be included in “Other Operating Revenues.” Attach as part of Exhibit B a schedule showing annual amounts forecast by individual revenue component for “other” operating revenues associated with the smelter's forecast interim controls operations. Identify in the supporting schedule any differences in the “other” revenue components reported in this Schedule and Schedule A.3 and explain the reasons for such differences.
Line 05—Total Operating Revenues. Enter for each year the total of Lines 01 through 04.
Line 06—Material Costs. Report total costs forecast for flux, refractories, coke and other materials directly associated with the smelter's processing of concentrates. Attach as part of Exhibit B a schedule showing the annual amounts forecast by major material cost components. For each cost component, identify the forecast quantity and unit price elements of material cost and explain the basis for forecasting these quantity and price elements. Identify in the supporting schedule any differences in the “other” material cost components shown in this Schedule and Schedule A.3 and explain the reasons for such differences.
Line 07—Production Labor Costs. Enter the totals reported in Schedule D.2, Line 05.
Line 08—Energy Costs. Enter the totals reported in Schedule D.2, Line 21.
Line 09—Pollution Control Costs. Report the total costs forecast for operation and maintenance of all pollution control equipment and facilities under the two alternative sets of assumptions made in corresponding Schedules D.1 and D.2. Byproduct credits associated with operation of the pollution control facilities should be eliminated from the cost accounts, reclassified to Schedule D.1, Line 10 and included in Line 03 of this Schedule. Attach a schedule as part of Exhibit B classifying pollution control costs by major cost components. Explain the basis used for estimating each of the cost components.
Line 10—Production Overhead Costs. Report the total costs forecast for indirect labor, indirect materials and other production overhead costs associated with the smelter's constant controls forecasts. Attach as part of Exhibit B a schedule showing annual overhead costs projected by major cost components associated with the smelter's operations. For each cost component, where appropriate, identify the forecast quantity and unit price elements of overhead costs and explain the basis for estimating these quantity and price elements. Also identify in the supporting schedule any differences in production overhead cost classifications used in this Schedule and Schedule A.3 and explain the reasons for such differences.
Line 11—Other Production Costs. Report other forecast production costs not previously reported on lines 06 through 10. Attach as part of Exhibit B supporting schedules showing the basis of the forecasts.
Line 12—Total Cost of Sales. Enter for each year the sum of operating costs reported on Lines 06 through 11.
Line 13—Gross Operating Profit. Enter for each year the difference between Lines 05 and 12.
Line 14—Selling, General and Administrative Expenses. Report the total costs forecast for administrative, marketing and general corporate overhead functions that directly or indirectly support the smelter's operations. Refer to the NSO Financial Reporting Overview for general discussion of indirect cost allocations from overhead cost pools. Attach as part of Exhibit B a schedule classifying selling, general and administrative expenses into major cost components. Indicate whether each component represents costs directly assignable to the smelter or indirect costs allocated from other business segments to the smelter. Explain the basis used for estimating the amount of expected costs included in each component and the basis used for allocating indirect cost elements to the smelter. Identify and explain any differences between the selling, general and administrative cost classification used in this Schedule and that used in Line 15 of Schedule A.3.
Line 15—Taxes, Other than Income Taxes. Report the total costs forecast for property taxes and associated levies paid to governmental units by or for the benefit of the smelter operation. Attach as part of Exhibit B a schedule classifying operating taxes by major component. Indicate whether each component represents taxes directly assignable to the smelter or taxes that have been allocated among more than one facility. Explain the basis used for estimating taxes and the basis for any allocation of taxes to the smelter. Identify and explain any differences between the component classifications used in this Schedule and those used in Line 16 of Schedule A.3.
Line 16—Research Costs. Report the estimates of research costs incurred directly by or for the benefit of the smelter operations. Attach as part of Exhibit B a schedule classifying the costs by major direct and indirect cost components. Explain the basis for estimating the costs assigned to each component. Identify and explain any differences between classifications used in this Schedule and those used in Line 17 of Schedule A.3.
Line 17—Pollution Control Facility Depreciation and Amortization. Report the estimates of depreciation and amortization charges associated with the smelter's actual and forecast investment in all pollution control equipment and facilities under the two alternative sets of assumptions made in corresponding Schedules D.1 and D.2. Reported charges should be computed in accordance with depreciation and amortization methods adopted for tax reporting purposes by the firm. Attach explanatory supporting schedules as part of Exhibit B.
Line 18—Other Smelter Facility Depreciation and Amortization. Report the pro forma estimates of depreciation and amortization charges associated with the smelter's investment in equipment and facilities other than those classified as pollution control facilities. Attach explanatory supporting schedules as part of Exhibit B.
Line 19—Interest on Short-Term Debt. Report the estimates of interest and other financing charges on forecast short-term obligations as classified in the smelter's current liabilities on Schedule A.4. Interest and associated financing charges on long-term debt should not be included as an expense identifiable with the smelter's operations. Attach as part of Exhibit B a schedule showing the interest-bearing, short-term debt contracts identifiable with the smelter's operations, the interest rate projected for these contracts, and the estimated annual interest charges. Identify and explain any differences between the classifications used in this Schedule and those used in Line 20 of Schedule A.3.
Line 20—Miscellaneous Operating Expenses. Report only the total operating expenses associated with or allocated to the smelter that cannot be appropriately classified in one of the preceding line items. Attach as part of Exhibit B a schedule showing the classification of these residual operating expenses into major cost components. Explain the basis used for forecasting the cost under each component. Identify each cost component in terms of direct or indirect cost and explain the basis used for allocating the indirect costs to smelter operations. Identify and explain any differences between cost classifications included in this Schedule and those used in Line 21 of Schedule A.3.
Line 21—Total Other Operating Expenses. Enter for each year the sum of operating costs reported on Lines 14 through 20.
Line 22—Income From Operations. Enter for each year the difference between Lines 21 and 13.
Line 23—Income Taxes. Enter the product of income from operations (Line 22) and the sum of the Federal, State and local marginal tax rates. Attach as part of Exhibit B a schedule detailing the estimated marginal tax rate by taxing entity.
Line 24—Net Income From Operations. Enter for each year the difference between Lines 23 and 22.
The temporary waiver from interim controls test is on Line 13 of Schedule D.3 that was completed under the assumption of installation of interim constant control equipment and no installation of any additional SO2 controls that the smelter would otherwise be required to install but for the issuance of an NSO. Applicants will be eligible for a temporary waiver from the interim development of constant control technology for sulfur dioxide emissions if the reported gross operating profit on Line 13 is a negative value for one or more years during which the NSO is in effect.
Schedule D.4—Interim Controls Sustaining Capital Investment Forecast
General. Use Schedule D.4 to report yearly sustaining capital outlays for maintenance of the smelter's existing productive capability. The applicant should complete Schedule D.4 twice, under two alternative assumptions: (1) Installation of interim constant control equipment, no installation of any additional SO2 controls that the smelter would otherwise be required to install but for the issuance of an NSO, and closure after January 1, 1988, and (2) installation of interim constant equipment and any additional SO2 controls required to comply with the smelter's SIP emission limitation by January 2, 1988, so that the smelter will remain open through the horizon period.
Major elements of these outlays should be disclosed, as well as the total of such outlays. Estimates shall be restricted to those items that will be capitalized for tax purposes. These outlays shall primarily be for plant replacement, although outlays for improvements and expansion may be included to the extent that improvements and/or expansion, exclusive of required pollution control outlays, can be justified as economically feasible. Estimates of sustaining capital investments shall exclude any incremental investment for sulfur dioxide emission controls reported in Line 06 of Schedule D.6. Sustaining capital investments in facilities shared with other operating segments shall be allocated in accordance with the instructions given below.
Estimates of sustaining capital shall be compatible with productive capacity and pollution control requirements underlying the operating revenue and cost forecasts incorporated in Schedule D.3.
Line 01 to 06—Sustaining Capital. Report for each year by individual line item property, plant and equipment sustaining capital investments assignable to smelter operations. Include both (1) property, plant and equipment directly associated with the smelter's operations and (2) facilities shared with other operating segments to the extent that a causal and beneficial relationship can be established for the intersegment allocations of such facility investments.
Attach as part of Exhibit B an explanatory schedule disclosing and supporting by individual line item the major elements of annual capital expenditures for sustaining capital. Further classify these annual capital expenditures into both (1) investments required to maintain the smelter versus investments in smelter expansion and improvements and (2) direct facility versus joint-use facility investments. Explain the method used for allocating capital expenditures on joint-use facilities to the smelter's operations.
Line 07—Total Smelter Sustaining Capital. Enter for each year the total of Lines 01 through 06. Transfer the reported total for each year to Schedule D.6, Line 06.
Schedule D.5—Cash Proceeds From Liquidation
General. Use Schedule D.5 to calculate cash proceeds from liquidation. Applicants should determine the current salvage value of their existing investment in the smelter as the net proceeds that could be derived through an orderly liquidation of the smelter's assets. The net cash proceeds should be reported after an appropriate allowance for disposal costs, contractual claims against the smelter (e.g., labor termination penalties), and income tax effects on the corporation of such liquidation costs.
The applicant must stipulate the most advantageous alternative market (use) for the smelter's facilities. Generally, this market will be:
Secondary market for used plant and equipment.
Sale for scrap.
Abandonment where the disposal cost exceeds scrap value.
The current net salvage value should be disaggregated into the same property, plant and equipment asset groups reported under the historical capital investment summary, Schedule A.4. The line items in Schedule D.5 are explained in the following instructions.
Line 01—Current Assets. Enter in Columns 1 and 2, the value of total current assets shown in Line 08 of Schedule A.4 (Historical Capital Investment Summary) for 1983. No gain or loss should be reported in Columns 3 through 5 for the liquidation of current asset investments.
Lines 02–07—Property Plant and Equipment. Enter in Column 1 the appraised liquidation value (in terms of pretax cash proceeds) of the smelter by asset group. This estimate should be certified by a qualified third party professional appraiser and shall represent the best use and highest alternative value of these assets. The liquidation value of any assets which are jointly used by the smelter and other operating segments shall be excluded if, upon closure of the smelter, such assets would continue in service for the non-smelter activity.
In Column 2, report the net book value of these assets for which liquidation values have been reported in Column 1. The reported values should correspond with amounts reported for 1982 in lines 09 through 15 in Schedule A.4 as adjusted for appropriate eliminations of joint-use facilities and reconciliation to a net book value as reported for income taxes. Attach as part of Exhibit B supporting schedules showing all adjustments and conversion of the net book value as reported on the financial statements, to net book value that would be used for income tax purposes.
Compute Column 3 as Column 1 less Column 2. The gain (or loss) shown in Column 3 shall be segregated into ordinary income and capital gains components subject to taxation pursuant to applicable income tax rules. Enter ordinary income in Column 4 and capital gains in Column 5.
Line 08—Total Smelter Investment. Enter the sum of Lines 02 through 07 for each of the columns.
Line 09—Other Non-current Assets. In Column 1, report the appraised value of other non-current assets in accordance with the instructions for Line 18, Schedule A.4, except that any joint asset(s) that would continue in the event of smelter liquidation shall be excluded. This estimate shall be certified by a qualified third-party professional appraiser.
In Column 2, report the net book value of the non-current assets directly corresponding to those assets included in the liquidation value estimated under Column 1.
The remaining columns shall be completed in accordance with the instructions given above for Lines 02 and 06.
Line 10—Total Smelter Value. Enter the sum of Lines 01, 08 and 09.
Line 11—Total Current Liabilities. Report in both Columns 1 and 2, the value of total current liabilities shown in Line 25 of Schedule A.4 for 1983.
Line 12—Gross Liquidation Value. Enter the difference between Lines 10 and 11.
Line 13—Liquidation Costs. In Columns 1, 3 and 4, report the value of any liquidation costs such as labor contract termination penalties, severance pay and related costs, associated with closure of the smelter.
Line 14—Taxable Gain (or Loss). Enter in Columns 4 and 5, the differences between Lines 12 and 13.
Line 15—Income Tax Rate. Enter the sum of the Federal, State and local marginal tax rates of the firm for ordinary income and capital gains in Columns 4 and 5, respectively. Attach as part of Exhibit B a schedule detailing the estimated marginal tax rate by taxing entity.
Line 16—Income Tax on Gain (or Loss). In Columns 4 and 5, enter the product of Line 14 and the marginal income tax rates reported in Line 15. In Column 1, enter the sum of Columns 4 and 5.
Line 17—After Tax Cash Proceeds. Enter in Column 1 the difference between Line 12 and the sum of Lines 13 and 16.
Schedule D.6—Permanent Waiver from Interim Controls Test
General. Applicants must complete this Schedule and its supporting schedules if they seek a permanent waiver from interim control requirements. The applicant should complete Schedule D.6 twice, with revenue and production projections based on two alternative assumptions: (1) Installation of interim constant control equipment, no installation of any additional SO2 controls that the smelter would otherwise be required to install but for the issuance of an NSO, and closure after January 1, 1988, and (2) installation of interim constant control equipment and any additional SO2 controls required to comply with the smelter's SIP emission limitation by January 2, 1988, so that the smelter will remain open through the horizon period. Forecasts in Schedule D.6 shall be compatible with assumptions and forecasts in each set of Schedules D.1 through D.4. The line items in Schedule D.6 are explained in the following instructions.
Line 01—Net Income from Operations. Enter for each year the amounts reported in Schedule D.3, Line 24.
Line 02—Net Income Adjustments. Enter any adjustments to net income not included in Schedule D.3. When assuming closure after January 1, 1988, the applicant must include the proceeds from liquidation in 1988. The applicant must estimate liquidation value as of 1988 using one of two methods: (1) the applicant may complete Schedule D.5 assuming liquidation in 1988 and report the value of after-tax cash proceeds in Line 17; or (2) the applicant may use the value of after-tax cash proceeds in Line 17 of Schedule D.5, as already completed, assuming liquidation in the current (application) year, and expressing values in 1988 dollars. The current liquidation value must be inflated to 1988 dollars by applying the appropriate forecast percentage rate changes in the GNP price deflator. Attach explanatory supporting schedules in Exhibit B.
Lines 03 and 04—Depreciation and Amortization. Enter for each year the amounts reported in Schedule D.3, Lines 17 and 18, respectively.
Line 05—Operating Cash Flow. Enter for each year the total of amounts reported on Lines 01 through 04.
Line 06—Pollution Controls Capital Investment. Enter the estimated pollution control capital outlays projected to be made under the two alternative sets of assumptions described in the General section of this schedule. These controls shall include only interim control equipment for the first set of assumptions and both interim control equipment and any additional SO2 controls required to comply with the smelter's SIP emission limitation by January 2, 1988, for the second set of assumptions. The values assumed in this schedule shall correspond to the investment estimates shown in each set of supporting schedules for Line 17 of Schedule D.3. For purposes of allocating costs of the additional SO2 controls under the second set of assumptions, applicants must provide information establishing the period over which capital outlays for such controls would be made if installation of the controls begins the latest date that would still allow compliance to be achieved by January 2, 1988. Changes in working capital investment due to investment in control facilities may be added to the capital investment estimates shown in the corresponding supporting schedules for Schedule D.3.
Line 07—Sustaining Capital. Enter for each year the amounts reported in Schedule D.4, Line 07.
Line 08—Total. Enter for each year the sum of Lines 05 and 06.
Line 09—Net Cash Flow Projections. Enter for each year the difference between Lines 04 and 07.
Line 10—Discount Factors. Enter the discount factor for each year, computed as described in the instructions under Section 2.6.
Line 11—Present Value of Future Cash Flows. Enter for each year the product of Lines 08 and 09.
Line 12—Horizon Value. Enter under the Total column the estimated horizon value of the smelter reported in Schedule D.7, Line 16.
Line 13—Discount Factor. Enter under the Total column the appropriate discount factor, computed as described in the instructions under Section 2.6.
Line 14—Present Value of Horizon Value. Enter under the Total column the product of Lines 11 and 12.
Line 15—Present Value of Future Cash Flows. Enter under the Total column the sum of amounts previously reported on Line 10 for 1984 through 1990.
Line 16—Total Present Value. Enter the sum of Lines 13 and 14.
Line 17—Current Salvage Value. Enter the amount reported in Schedule D.5, Line 17, if the value is greater than zero. If the value is zero or less, enter zero.
Line 18—Net Present Value. Enter the difference between Lines 16 and 17. In determining eligibility for a permanent waiver from interim control requirements, an applicant must use the higher of the two net present value figures computed under the two alternative assumptions. Applicants reporting a negative value for the higher net present value figure will be eligible for a permanent waiver from interim use of a constant control system for sulfur dioxide emissions.
Schedule D.7—Horizon Value of Cash Flows for the Interim Controls Test
General. Use Schedule D.7 to calculate the horizon value of net cash flow projections for the Interim Controls Test. This horizon value is used in Schedule D.6. The computation of the horizon value is different for this test than for the Profit Protection Test because this test requires the reporting of depreciation for tax purposes.
In Schedule D.7, the applicant removes the tax savings of control equipment depreciation from the cash flows for the last two forecast years. A depreciation-free horizon value is then calculated from these depreciation-free cash flows. The tax savings of constant controls depreciation during the horizon years are then calculated separately. The final horizon value is equal to the sum of the depreciation-free horizon value and the tax savings from depreciation of constant controls accruing over the horizon years. The line items in Schedule D.7 are explained in the following instruction.
Line 01—Net Cash Flow Projections. Enter for each of the final two forecast years the values in Schedule D.6, Line 09, for the corresponding years.
Line 02—Depreciation and Amortization. Enter for each of the final two forecast years the value in Schedule D.6, Line 03, for the corresponding years.
Line 03—Marginal Tax Rate. Enter for each of the final two forecast years the marginal income tax rate applicable to the smelter. This rate should incorporate both Federal and State tax liability.
Line 04—Tax Savings. Enter for each of the final two forecast years the product of Lines 02 and 03.
Line 05—Nominal Dollar Values. Enter for each of the final two forecast years the difference between Lines 01 and 04.
Line 06—1990 Dollar Values. For each of the final two forecast years the nominal dollar values must be expressed in the last forecast year's dollars (1990 dollars). Transfer the 1990 amount in Line 05 directly to Line 06. Inflate the 1989 amount to 1990 dollars using the forecast GNP price deflator.
Line 07—Average. Enter under the Total column the average of the two values in Line 06.
Line 08—Horizon Factor. Enter under the Total column the horizon factor provided in Section 2.7.
Line 09—Depreciation-free Horizon Value. Enter under the Total column the product of Lines 07 and 08.
Line 10—Depreciation and Amortization. Enter for each year of the horizon period depreciation charges associated with the smelter's investment in equipment and facilities related to pollution controls. These investments should include those actually made and those forecast to be made by the end of the forecast period. Reported charges should be computed in accordance with depreciation and amortization methods adopted for tax reporting purposes by the firm. Attach as part of exhibit B supporting schedules consistent with those supporting Line 17 in Schedule D.3.
Line 11—Marginal Tax Rate. Enter for each year of the horizon period the marginal income tax rate applicable to the smelter. This rate should incorporate both Federal and State tax liability.
Line 12—Tax Savings. Enter for each year of the horizon period the product of Lines 10 and 11.
Line 13—Discount Factors. Enter the discount factor for each year of the horizon period. This shall be computed according to the instructions under Section 2.6, except that the variable N found in the discount factor formula represents the number of years in the future, counting from the last forecast year. For example, N=1 for the first year of the horizon period.
Line 14—Present Value of Tax Savings. Enter for each year of the horizon period the product of Lines 12 and 13.
Line 15—Total Present Value of Tax Savings. Enter under the Total column the sum of values on Line 14 for the horizon years.
Line 16—Horizon Value. Enter under the Total column the sum of Lines 09 and 15.
Environmental Protection Agency
Primary Nonferrous Smelter Order Application
Part I—Identification Information
1. Firm name____________________
2. Street/Box/RFD____________________
3. City____________________
4. State____________________
5. Zip Code____________________
6. IRS Employer Identification No.____________________
7. SEC 1934 Act Registration No.____________________
8. Smelter Name____________________
9. Street/Box/RFD____________________
10. City____________________
11. State____________________
12. Zip Code____________________
13. Contact Person____________________
14. Title____________________
15. Street/Box/RFD____________________
16. City____________________
17. State____________________
18. Zip Code____________________
19. Telephone____________________
Part II—Certification
I certify that the information provided herein and appended hereto is true and accurate to the best of my knowledge. I understand that this information is being required, in part, under the authority of Section 114 of the Clean Air Act, 42 U.S.C. 7414.
Name____________________
Title____________________
Signature____________________
Date____________________
Schedule A.1_Historical Revenue Data
[Smelter identification]
----------------------------------------------------------------------------------------------------------------
Line 1979 1980 1981 1982 1983
----------------------------------------------------------------------------------------------------------------
A. Copper product sales:
1. Total quantity sold................................ 01 ....... ....... ....... ....... .......
2. Unaffiliated customer sales:
a. Quantity sold.................................. 2 ....... ....... ....... ....... .......
b. Operating revenue.............................. 03 ....... ....... ....... ....... .......
c. Average unit price............................. 04 ....... ....... ....... ....... .......
d. Average product grade.......................... 05 ....... ....... ....... ....... .......
3. Affiliated customers sales:
a. Quantity sold.................................. 06 ....... ....... ....... ....... .......
b. Operating revenue.............................. 07 ....... ....... ....... ....... .......
c. Average unit price............................. 08 ....... ....... ....... ....... .......
d. Average product grade.......................... 09 ....... ....... ....... ....... .......
4. Adjusted copper revenues:
a. Total copper revenues.......................... 10 ....... ....... ....... ....... .......
b. Transfer price adjustment...................... 11 ....... ....... ....... ....... .......
c. Other revenue adjustments...................... 12 ....... ....... ....... ....... .......
d. Adjusted copper revenues....................... 13 ....... ....... ....... ....... .......
B. Lead product sales:
1. Total quantity sold................................ 14 ....... ....... ....... ....... .......
2. Unaffiliated customer sales:
a. Quantity sold.................................. 15 ....... ....... ....... ....... .......
b. Operating revenue.............................. 16 ....... ....... ....... ....... .......
c. Average unit price............................. 17 ....... ....... ....... ....... .......
d. Average product grade.......................... 18 ....... ....... ....... ....... .......
3. Affiliated customer sales:
a. Quantity sold.................................. 19 ....... ....... ....... ....... .......
b. Operating revenue.............................. 20 ....... ....... ....... ....... .......
c. Average unit price............................. 21 ....... ....... ....... ....... .......
d. Average product grade.......................... 22 ....... ....... ....... ....... .......
4. Adjusted lead revenues:
a. Total lead revenues............................ 23 ....... ....... ....... ....... .......
b. Transfer price adjustment...................... 24 ....... ....... ....... ....... .......
c. Other revenue adjustments...................... 25 ....... ....... ....... ....... .......
d. Adjusted lead revenues......................... 26 ....... ....... ....... ....... .......
C. Zinc product sales:
1. Total quantity sold................................ 27 ....... ....... ....... ....... .......
2. Unaffiliated customer sales:
a. Quantity sold.................................. 28 ....... ....... ....... ....... .......
b. Operating revenue.............................. 29 ....... ....... ....... ....... .......
c. Average unit price............................. 30 ....... ....... ....... ....... .......
d. Average product grade.......................... 31 ....... ....... ....... ....... .......
3. Affiliated customer sales:
a. Quantity sold.................................. 32 ....... ....... ....... ....... .......
b. Operating revenue.............................. 33 ....... ....... ....... ....... .......
c. Average unit price............................. 34 ....... ....... ....... ....... .......
d. Average product grade.......................... 35 ....... ....... ....... ....... .......
4. Adjusted zinc revenues:
a. Total zinc revenues............................ 36 ....... ....... ....... ....... .......
b. Transfer price adjustment...................... 37 ....... ....... ....... ....... .......
c. Other revenue adjustments...................... 38 ....... ....... ....... ....... .......
d. Adjusted zinc revenues......................... 39 ....... ....... ....... ....... .......
D. Molybdenum or other nonferrous metal sales:
1. Total quantity sold................................ 40 ....... ....... ....... ....... .......
2. Unaffiliated customer sales:
a. Quantity sold.................................. 41 ....... ....... ....... ....... .......
b. Operating revenue.............................. 42 ....... ....... ....... ....... .......
c. Average unit price............................. 43 ....... ....... ....... ....... .......
d. Average product grade.......................... 44 ....... ....... ....... ....... .......
3. Affiliated customer sales:
a. Quantity sold.................................. 45 ....... ....... ....... ....... .......
b. Operating revenue.............................. 46 ....... ....... ....... ....... .......
c. Average unit price............................. 47 ....... ....... ....... ....... .......
d. Average product grade.......................... 48 ....... ....... ....... ....... .......
4. Adjusted molybdenum or other nonferrous metal
revenues:
a. Total molybdenum or other nonferrous metal 49 ....... ....... ....... ....... .......
revenues.........................................
b. Transfer price adjustment...................... 50 ....... ....... ....... ....... .......
c. Other revenue adjustments...................... 51 ....... ....... ....... ....... .......
d. Adjusted molybdenum or other nonferrous metal 52 ....... ....... ....... ....... .......
revenues.........................................
E. Primary metal revenues................................. 53 ....... ....... ....... ....... .......
F. Tolling service revenues:
1. Total toll concentrates processed.................. 54 ....... ....... ....... ....... .......
2. Unaffiliated customer revenues:
a. Concentrates processed......................... 55 ....... ....... ....... ....... .......
b. Operating revenue.............................. 56 ....... ....... ....... ....... .......
c. Average unit price............................. 57 ....... ....... ....... ....... .......
d. Average product grade.......................... 58 ....... ....... ....... ....... .......
3. Affiliated customer revenues:
a. Concentrates processed......................... 59 ....... ....... ....... ....... .......
b. Operating revenue.............................. 60 ....... ....... ....... ....... .......
c. Average unit price............................. 61 ....... ....... ....... ....... .......
d. Average product grade.......................... 62 ....... ....... ....... ....... .......
4. Adjusted tolling service revenues:
a.Total tolling service revenue.................. 63 ....... ....... ....... ....... ....... (continued)