Agenda - Council - 06/09/2026 - Laserfiche WebLink

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NOTE 1— SIGNIFICANT ACCOUNTING POLICIES (CONTINUED) M. Land Held for Resale Land held for resale represents various property purchases made by the City with the intent to sell in order to increase tax base or to attract new businesses. These assets are stated at the lower of cost or acquisition value. The City currently retains parcels that will be available for future commercial development along Highway 10 now that the interchange projects on the highway have been completed in 2025. N. Capital Assets Capital assets, which include property, buildings, improvements, equipment, and infrastructure assets are reported in the applicable governmental or business -type activities columns in the government -wide financial statements. Such assets are capitalized at historical cost, or estimated historical cost for assets where actual historical cost is not available. Donated assets are recorded as capital assets at their estimated acquisition value at the date of donation. The City defines capital assets as those with an initial, individual cost of $10,000 or more with an estimated useful life in excess of one year. Groups of similar assets acquired at or near the same time for a single objective, with individual costs above $50,000, are also capitalized as the cost is considered significant. The cost of normal maintenance and repairs that do not add to the value of the asset or materially extend asset lives are not capitalized. Allowed by accounting principles generally accepted in the United States of America, the City has elected not to retroactively capitalize the infrastructure of its governmental activities acquired prior to January 2004. Capital assets are recorded in the government -wide and Proprietary Fund financial statements, but are not reported in the Governmental Fund financial statements. Capital assets are depreciated using the straight- line method over their estimated useful lives. Land and construction in progress are not depreciated. Useful lives vary from 15 to 50 years for buildings and structures and improvements other than buildings, 5 to 10 years for office equipment, motor vehicles and machinery and equipment, and 20 to 50 years for water and sewer lines and infrastructure. O. Compensated Absences Payable The City recognizes a liability for compensated absences for leave time that (1) has been earned for services previously rendered by employees, (2) accumulates and is allowed to be carried over to subsequent years, and (3) is more likely than not to be used as time off or paid in cash to the employee or payment to a health care savings account during or upon separation from employment. Based on the criteria listed, three types of leave qualify for liability recognition for compensated absences — compensatory time, vacation and sick leave. The liability for compensated absences is reported as incurred in the government -wide financial statements. The liability for compensated absences includes salary -related benefits, where applicable. Compensatory Time The City's personnel policy and union contracts pen -nits employees to accumulate earned but unused compensatory time, which are eligible for payment at the employee's current pay rate upon separation from employment. Vacation The City's personnel policy permits employees to accumulate earned but unused vacation time, which are eligible for payment at the employee's current pay rate upon separation from employment. 67