(A) Capital asset. Capital asset is an asset having a useful life of more than one year and an actual or historical cost of $5,000 or more. Capital assets include: land, easements, right-of-ways, land improvements, building, building improvements, construction in progress, machinery and equipment, vehicles, infrastructure, works of art and monuments, and all other tangible assets used in operations with useful lives extending beyond one year.
(B) Valuation of capital assets.
(1) Capital assets should be recorded at actual cost. Normally, the cost recorded is the purchase price or construction costs of the asset, but also included are any reasonable and necessary costs incurred to place the asset in its intended location and intended use that can be directly related to the asset. Such costs could include the following: legal and title fees; appraisal and negotiation fees, surveying fees; damage payments; land preparation costs, demolition costs; architect and accounting fees; insurance premiums during construction; transportation charges; and interest costs during construction.
(2) Donated or contributed assets should be recorded at their fair market value on the date donated or acquired.
(C) Fixed asset. Tangible assets of a durable nature employed in the operating activities of the unit and that are relatively permanent and are needed for the production or sale of goods or services are termed property, plant and equipment, or fixed assets. These assets are not held for sale in the ordinary course of business. This broad group is usually separated into classes according to the physical characteristics of the items (such as, land, building, improvements other than buildings, machinery and equipment.)
(D) Capital outlays. Expenditures that benefit both current and future fiscal periods. This includes costs of acquiring land or structures, construction or improvement of buildings, structures, or other fixed assets, and equipment purchases having an appreciable and calculable period of usefulness. These are expenditures resulting in the acquisition of or addition to the government’s general fixed assets.
(BC Ord. 2019-0042, passed 12-2-2019)