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HomeMy WebLinkAbout2016-05-02-J01Q Fixed Asset Policy► A 1v/aukee THE KEY TO GOOD LIVING AGENDA ITEM: CITY OF WAUKEE, IOWA CITY COUNCIL MEETING COMMUNICATION MEETING DATE: May 2, 2016 AGENDA ITEM: Consideration of approval of a resolution approving City of Waukee Fixed Asset Policy FORMAT: Resolution SYNOPSIS INCLUDING PRO & CON: The City currently does not have a formal fixed asset policy. The national Governmental Finance Officers Association (GFOA) recommends several policies be approved for municipal entities, including a fixed asset policy. The attached policy was drafted from the current policies adopted by Clive, Urbandale, Ankeny, West Des Moines and Johnston as well as the recommended language from GFOA. FISCAL IMPACT INCLUDING COSTBENEFIT ANALYSIS: COMMISSION/BOARDICOMMITTEE COMMENT: STAFF REVIEW AND COMMENT: . RECOMMENDATION: Staff would recommend the approval of the financial policy. ATTACHMENTS: I. General Financial Policy II. Proposed Resolution PREPARED BY: Linda Burkhart REVIEWED BY: PUBLIC NOTICE INFORMATION — NAME OF PUBLICATION: DATE OF PUBLICATION: THE CITY OF WAUKEE, IOWA IS7__*01Rol a0]►I APPROVING CITY OF WAUKEE FINANCIAL POLICY — FIXED ASSET POLICY, OF THE STANDARD ADMINISTRATIVE POLICY AND PROCEDURES MANUAL IN THE NAME AND BY THE AUTHORITY OF THE CITY OF WAUKEE, IOWA WHEREAS, the City of Waukee, Iowa is a duly organized municipality within Dallas County; AND, WHEREAS, the Waukee City Council shall approve operating policies and procedures; AND, WHEREAS, City staff has presented the City Council with a Fixed Asset Policy, attached hereto as Exhibit A, and recommends approval. NOW THEREFORE BE IT RESOLVED by the City of Waukee City Council in session this 2nd day of May, 2016, that the City of Waukee Financial Policy — Fixed Asset Policy, of the Standard Administrative Policy and Procedures Manual is hereby approved. William F. Peard, Mayor Attest: Rebecca D. Schuett, City Clerk ROLL CALL VOTE AYE NAY ABSENT ABSTAIN Shane Blanchard Brian Harrison Shelly Hughes Larry R. Lyon Rick Peterson Waukee •TTW1 P THE KEY TO GOOD LIVING Standard Administrative Policy & Procedures Manual Title: FINANCIAL POLICY Date of Version: May 2, 2016 Section: FIXED ASSET POLICY Resolution No.: #16- SECTION 1 — Policy It is the policy of the City of Waukee that City assets be properly accounted for and used for appropriate City uses. The Finance Department, with assistance from all other Departments of the City, will be responsible to ensure fixed assets are tagged, inventoried on a regular basis, and accounted for by fund and asset category. It is the responsibility of City Department Director's to ensure that proper budgeting and purchasing guidelines are followed and that fixed assets are adequately controlled and used for appropriate City purposes. All City Departments are subject to the provisions of this policy. A. For an asset to be capitalized (recorded and depreciated), its cost must exceed certain cost thresholds. An asset's cost includes any cost involved with the purchase of the asset and readying the asset for use. Capitalization thresholds are set as follows: Vehicles and Equipment $ 5,000 Office Furniture and Equipment $ 5,000 Land and Right -of -Way $ - Land and Building Improvements $ 25,000 Buildings $ 25,000 Infrastructure $ 50,000 In addition, the asset must be tangible in nature and have a useful life of three (3) or more years. Certain improvements will only be capitalized if they improve or significantly alter the use, value, or useful life of the asset. The threshold for insurance coverage is $2,500 for all assets except land and right-of-way ($0). B. A current inventory ledger of capitalized assets will be maintained by the Finance Department that will include depreciation, cost and useful life. C. Eligible fixed assets should be depreciated over their estimated useful lives using the straight-line methodology for depreciating all fixed assets. Depreciation will begin in the month the asset is placed in services, and will be written off evenly over the useful life of the asset. D. All departments are responsible for the custody, safekeeping, and maintenance of the assets belonging to their department. Each department will be responsible for and will maintain adequate insurance coverage, title security, and license plate records. E. All City vehicles and equipment will be assigned an equipment number by the Equipment Services Department. All vehicles and equipment will be assigned a budget code by the respective Department for the purpose of accounting for the asset's operating expenses. A list of assets and their respective budget codes and equipment numbers will be maintained in the Finance Department. F. Any disposals, trade-ins, sales, or transfers of any assets should be identified by serial number, make, model or other identification and reported to the Finance Department. Disposals of fixed assets will be made in accordance with Iowa State law, as well as the City's Surplus Property Disposal policy. G. The Finance Department will periodically select assets at random from the records, to be inspected and will periodically select assets from a department to trace in order to ensure the accuracy and completeness of the ledger. SECTION 2 — Procedures The following procedures shall be followed by all City of Waukee Departments. A. Fixed assets should be acquired in accordance with the City's Purchasing Policy and the following steps: 1. Department Director's shall review budget to ensure the requested asset has been included and approved in the current fiscal year budget. If not an approved and budgeted item, contact the Finance Director to determine appropriate action. Criteria to consider for budget amendment approval includes availability of funds, urgency, and needs of the Department requesting the asset. 2. The Department making the asset purchase should complete a Vehicle/Equipment Record Form, which should include the model number, serial number, manufacturer, model year, and any other information such as color, size, weight, etc. that will help identify the asset. The Form should be submitted to the Finance Department. 3. For vehicles, equipment, and other assets that are maintained through the Equipment Services Department, the asset should be directed to the garage prior to being placed into service for numbering, decals and lettering, and other field preparation work. The Equipment Services Department will assign the asset a vehicle/equipment number. ri All 4. For assets that require title recording, license plates, and/or insurance coverage, copies of the acquisition paperwork along with the title transfer documents and other relevant documentation, should be forwarded to the City Clerk's office prior to placing the asset into service. The disposal of all fixed assets should be conducted in accordance with the City's Surplus Property Disposal policy, and Iowa State law. Asset transfers between departments should be conducted following the City's Surplus Property Disposal policy.