(A) The definition of MACHINERY AND EQUIPMENT is an apparatus, tool or conglomeration of pieces to form a tool. Said tool will stand alone and not become a part of a basic structure or building; the tool shall have a useful life greater than five years.
(B) The town will capitalize and tag items with an individual value equal to or greater than $10,000. Machinery combined with other machinery to form one unit with a total value greater than the above- mentioned limit will be one unit.
(C) Shipping charges, consultant fees and any other costs directly associated with the purchase, delivery or setup which makes such equipment operable for its intended purpose, including contractors’ and town employees’ salaries and benefits, will be capitalized.
(D) Improvements or renovations to existing machinery and equipment will be capitalized only if the result of the change meets all of the following conditions:
(1) The total cost exceeds $10,000;
(2) The useful life is extended two or more years; and
(3) The total cost will be greater than the current book value and less than the fair market value.
(E) Examples include:
(1) A work truck being equipped with screens, lights or radios for use as a single unit throughout its life expectancy is considered one unit;
(2) A department’s computer, that is, CPU, monitor, keyboard and printer, is considered one unit; and
(3) If police cars are constantly changing light bars or radios to other vehicles, then the town will capitalize each piece of equipment separately if it meets the required dollar amount.
(F) A department will record donated machinery and equipment at fair market value on the date of transfer, plus any associated costs.
(G) Purchases made using federal or state funding will follow the source funding policies and the procedures in divisions (A) through (F) above.
(Ord. 2019-13, passed 12-3-2019)