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(a) The City of Conneaut shall maintain a fixed asset accounting system. The fixed asset system shall maintain sufficient information to permit the following:
(1) The preparation of year-end financial statements in accordance with generally accepted accounting principles.
(2) Adequate insurance coverage.
(3) Control and accountability.
(b) Fixed assets are defined as those tangible assets of the City with (1) a useful life in excess of two (2) years, (2) an initial cost equal to or exceeding the amount determined every three (3) years in the City’s administrative guidelines, and (3) which the City intends to hold or continue in use over an extended period of time. If a single item does not meet the threshold amount, but is typically purchased in aggregate by the City, the Finance Department shall verify which items shall be classified as fixed assets and recorded at the time of purchase or acquisition. Further, some items may be identified as “controlled” assets that, although they do not meet all fixed asset criteria, are to be recorded on the fixed asset system to maintain control.
(c) Fixed assets shall be classified as follows:
(2) Land improvements.
(3) Buildings and building improvements.
(4) Improvements other than building.
(5) Machinery and equipment.
(6) Furniture and fixtures.
(8) Underground lines and other infrastructure.
(d) Leased fixed assets and assets which are jointly owned shall be identified and recorded on the fixed asset system.
(e) Fixed assets shall be recorded at actual, or if not determinable, estimated purchase price or fair market value at the time of acquisition. The method(s) to be used to estimate such price or market value historical cost shall be established by the Finance Director.
(f) The Finance Director shall develop administrative guidelines to address the proper purchase, transfer, and disposal of fixed assets. Such assets shall be disposed of in such a manner as will be in the public interest and benefit the City.
(1) Disposition of real property. Disposition of real property shall be in accordance with Chapter 109 of the Codified Ordinances of the City of Conneaut or any subsequent ordinance in effect at the time of the proposed disposition.
(2) Disposition of personal property. Disposition of personal property may be accomplished by one of the following methods:
A. Pursuant to the Ohio Constitution, Article XVIII, Section 3 that reserves to municipalities its home rule powers and Conneaut City Charter, Article 1, Section 3 that reserves to the City its home rule powers, City Council may adopt an ordinance setting forth the procedure for the disposition of personal property;
B. Pursuant to Ohio Revised Code Section 721.15(A), personal property not needed for municipal purposes that has an estimated value of one thousand dollars ($1,000.00) may be sold by the City Manager or departmental supervisor having supervision or management of that property;
C. Pursuant to Ohio Revised Code Section 721.15(A), personal property with an estimated value of one thousand dollars ($1,000.00) or more may be sold when authorized by ordinance to the highest and best bidder after advertisement for not less than two (2) nor more than four (4) weeks in a newspaper of general circulation;
D. City Council may pass a resolution regarding vehicles, equipment or machinery that is obsolete, unneeded, or unfit for public use that permits said property to be utilized as a trade-in to purchase vehicles, equipment or machinery of the same type;
E. Pursuant to Ohio Revised Code Section 721.15(C), City Council may pass a resolution declaring that municipal personal property that has no value and is not needed for the public use or is obsolete or unfit for the use for which it was acquired may be discarded or salvaged;
F. Pursuant to Ohio Revised Code Section 721.15(D), regardless of value, City Council may pass a resolution permitting the sale at public auction and/or by internet auction, motor vehicles, road machinery, equipment, tools and supplies not needed for public use or that is obsolete or unfit for the use by which it was required. In the resolution, City Council will establish how the auction will be conducted and the terms and conditions thereof. Bidding for internet auction shall be accepted for at least fifteen (15) days (inclusive of Saturdays, Sundays and legal holidays). Notice of the auction will be published twice and the second notice will be published no sooner than ten (10) nor more than twenty (20) days after the publication of the first notice. A similar notice shall be published continuously at the Finance Office and on the City’s website.
(g) The Finance Director shall verify whether an expense should be recorded as an improvement to a fixed asset or maintenance cost. An improvement of a fixed asset significantly increases its value, life or capacity to serve, and should be capitalized and depreciated over its life. Maintenance restores a fixed asset to its original level of service and should not be capitalized.
(h) Depreciation is the allocation of the cost of a fixed asset over its estimated useful life. Depreciation shall be recorded for funded fixed assets using the straight line depreciation method.
(i) The following information shall be maintained for all fixed assests:
(1) Description (including whether the item was acquired in aggregate).
(2) Asset classification (land, building, equipment, etc.)
(4) Purchase price/cost, or if not determined:
A. Estimated cost/purchase price.
B. Estimated fair market value.
C. Contract price (including all related charges to place the fixed asset in conditions or in its place for the intended use), or
D. Appraised value at the time of acquisition (if obtained by gift/donated).
(6) Date purchased/acquired.
(7) Voucher number.
(8) Estimated useful life.
(9) Estimated salvage value.
(10) Replacement cost.
(11) Accumulated depreciation.
(12) Method of acquisition (purchase, trade-in, lease, donated, etc.)
(14) Manner of asset disposal.
(Ord. 141-09. Passed 12-28-09.)