HomeMy WebLinkAboutResolution 2026-029
City of Atascadero
Resolution No. 2026-029
Page 1 of 1
RESOLUTION NO. 2026-029
A RESOLUTION OF THE CITY COUNCIL OF THE CITY OF ATASCADERO,
ESTABLISHING THE CITY OF ATASCADERO CAPITAL ASSET POLICY
WHEREAS, the City of Atascadero is committed to maintaining clear and comprehensive financial
policies that promote transparency, accountability, and sound fiscal management for the benefit of the City
Council and the community; and,
WHEREAS, establishing a Capital Asset Policy provides consistent guidelines for identifying,
recording, and managing the City’s capital assets in accordance with applicable Government Accounting
Standards; and,
WHEREAS, the adoption of such a policy ensures accurate financial reporting, supports long‑term
planning, and strengthens the City’s stewardship of public resources; and
WHEREAS, City staff has prepared the proposed Capital Asset Policy and recommends its
adoption by the City Council.
NOW, THEREFORE, BE IT RESOLVED by the City Council of the City of Atascadero:
SECTION 1. Approval. The City Council of the City of Atascadero, at a regular session assembled
on May 12, 2026, hereby adopts the City of Atascadero Capital Asset Policy, attached hereto as Exhibit A
and incorporated herein by reference.
SECTION 2. Effective Date. This Resolution shall take effect July 1, 2026, and shall remain in
full force and effect until amended or rescinded by the City Council.
PASSED AND ADOPTED at a regular meeting of the City Council held on the 12th day of May,
2026.
On motion by Council Member Funk and seconded by Council Member Peek, the foregoing
Resolution is hereby adopted in its entirety on the following roll call vote:
AYES: Council Member Funk, Newsom, Peek, Mayor Pro Tem Dariz, Mayor Bourbeau
NOES: None
ABSENT: None
ABSTAIN: None CITY OF ATASCADERO:
________________________________
Charles Bourbeau, Mayor
ATTEST:
Lara K. Henderson, City Clerk
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
EXHIBIT A
Working together to serve, build community and enhance quality of life.
City of Atascadero
Capital Asset Policy
May 12, 2026
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
i
Capital Asset Policy
Table of Contents
Section I – PURPOSE AND AUTHORITY............................................................................ 1
Section II – SCOPE .......................................................................................................... 1
Section III – DEFINITIONS ............................................................................................... 2
Section IV – ROLES AND RESPONSIBILITIES ................................................................... 3
Administrative Services Department ................................................................................. 3
Other City Departments ................................................................................................... 3
Internal Control and Segregation of Duties ........................................................................ 4
Section V - CAPITALIZATION THRESHOLDS .................................................................... 4
Section VI - VALUATION .................................................................................................. 5
Section VII – COMPONENTIZATION ........................................................................... 6
Section VIII – DEPRECIATION ......................................................................................... 6
Section IX – AGGREGATE PURCHASES ........................................................................... 7
Section X – ACQUISITION, SELF-CONSTRUCTED ASSETS AND CIP ................................ 7
Self-Constructed Assets ................................................................................................... 8
Construction in Progress (CIP) .......................................................................................... 8
Section XI – INTANGILE ASSETS ..................................................................................... 8
Easements/Right-of-Way .................................................................................................. 8
Computer Software .......................................................................................................... 8
Other Intangibles ............................................................................................................. 8
Section XII – RIGHT-TO-USE ASSETS ............................................................................... 9
Leases (GASB 87) ............................................................................................................. 9
SBITA (GASB 96) ............................................................................................................... 9
Public-Private/Public-Public Partnerships (PPPs) .............................................................. 9
Section XIII – ACCEPTANCE OF PUBLIC IMPROVEMENTS ............................................... 9
Section XIV – COSTS SUBSEQUENT TO ACQUISITION............................................... 10
Section XV – INVENTORY .............................................................................................. 10
Frequency ...................................................................................................................... 10
Process ......................................................................................................................... 10
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
ii
Section XVI – FEDERAL AND GRANT FUNDED PROPERTY .......................................... 11
Section XVII – IMPAIRMENTS AND ASSET RETIREMENT OBLIGATIONS ....................... 11
Impairments (GASB 42) .................................................................................................. 11
Asset Retirement Obligations (GASB 83) ......................................................................... 11
Insurance Recoveries ..................................................................................................... 12
Section XVIII – TRANSFERS, DISPOSALS, AND SALES ............................................... 12
Authorization and Process .............................................................................................. 12
Accounting Retirements ................................................................................................. 12
Lost or Stolen Assets ...................................................................................................... 12
Section XIX – FINANCIAL REPORTING ..................................................................... 13
Section XX – REVIEW AND UDPATES ....................................................................... 13
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
CITY OF ATASCADERO
CAPITAL ASSET POLICY
I. PURPOSE AND AUTHORITY
The purpose of this Capital Asset Policy is to ensure that the City of Atascadero’s assets are
acquired, safeguarded, controlled, disposed of, and accounted for in accordance with state
and federal regulations, generally accepted accounting principles, internal control
standards, and audit requirements.
This policy reinforces accountability and transparency in how the City manages public
resources. It ensures the City’s financial statements accurately reflect the condition and
use of long-term assets. The policy is practical for both sta and auditors to use, provides
consistency across all departments, and aligns with the City’s overall governance and
internal control structure.
This Policy is adopted pursuant to applicable GASB standards, including but not limited to:
GASB 34 – Basic Financial Statements and Infrastructure Reporting
GASB 42 – Impairment of Capital Assets
GASB 51 – Accounting and Financial Reporting for Intangible Assets
GASB 83 – Asset Retirement Obligations
GASB 87 – Leases
GASB 89 – Accounting for Interest Cost Incurred Before the End of a Construction
Period
GASB 96 – Subscription-Based Information Technology Arrangements (SBITA)
II. SCOPE
This policy applies to all City departments, divisions, programs, and component units that
acquire, construct, operate, maintain, or dispose of capital assets. This policy applies to all
property whether tangible (land, buildings, improvements, equipment, vehicles,
infrastructure) or intangible (easements, software) which is purchased, constructed,
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
2
donated, leased or other right-to-use arrangements (GASB 87), and subscription-based
Information Technology (IT) arrangements (GASB 96).
This policy also governs federal or grant-funded assets and requires adherence to Title 2 CFR
200.313 (Property Standards) and grantor-specific terms on acquisition, use, inventory, and
disposition. Departments must review grant requirements prior to making any purchase and
coordinate with Administrative Services to ensure the City’s records and financial reporting
comply with both grant obligations and GASB standards.
III. DEFINITIONS
Asset Retirement Obligation (ARO): A legally enforceable obligation associated with the
retirement of a tangible capital asset, requiring recognition and measurement in accordance
with GASB 83.
Capital Asset: A tangible or intangible asset used in operations that has a useful life
exceeding two years and meets the City’s applicable capitalization threshold.
Capitalization Threshold: The minimum cost at which an acquisition is recorded as a
capital asset rather than expensed.
Construction in Progress (CIP): Costs accumulated for projects or purchases that are not
yet complete. Upon substantial completion, the balance of that asset is reclassified to the
appropriate capital asset class.
Developer-Donated Assets: Infrastructure or other capital assets accepted by the City from
developers and recorded at either historical cost or fair value at the time of acceptance, in
accordance with applicable standards.
Historical Cost: The total expenditures incurred to acquire, construct, and place an asset
into service, net of any discounts, rebates, or allowances and reduced by salvage proceeds.
Donated assets are recorded at their fair value on the date of acceptance.
Impairment: A significant and unexpected decline in the service utility of a capital asset,
requiring recognition and disclosure per GASB 42.
Public-Private Partnership (PPP): A contractual arrangement in which a government, as the
transferor, grants a governmental or nongovernmental operator the right to use or operate a
non-financial asset (such as infrastructure) to deliver public services for a specified period,
in an exchange or exchange-like transaction.
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
3
Right-to-Use Asset: An intangible asset recognized under GASB 87 for leases and under
GASB 96 for SBITAs. The asset is measured and amortized in accordance with the
requirements of the applicable standard.
Subscription Based Information Technology Arrangement (SBITA): A contractual
agreement in which a government entity obtains the right to use a vendor’s IT software, alone
or together with related tangible IT assets, for a defined subscription term.
Useful Life: The period during which an asset is expected to provide service to the City, and
the timeframe used as the basis for calculating depreciation.
IV. ROLES AND RESPONSIBILITIES
Administrative Services Department
The Administrative Services Department is responsible for administering this policy,
ensuring compliance with all applicable accounting and regulatory standards, and updating
the policy as guidance evolves. Core responsibilities include:
Maintaining complete and accurate capital asset records
Establishing and periodically reviewing asset useful lives
Ensuring compliance with GASB pronouncements and relevant federal and state
requirements
Administering capitalization thresholds and related procedures
Coordinating and overseeing periodic physical inventories
Reviewing and recording asset impairments, retirements, public-private partnerships
(PPPs), and right-to-use assets
Preparing financial statement note disclosures and supporting schedules
Other City Departments
Departments are responsible for safeguarding City assets, implementing this policy within
their operational activities, and providing complete, accurate, and timely information to
Administrative Services to ensure proper accounting and financial reporting. When special
funding or grant requirements impose additional conditions (e.g., federal property
standards), those requirements are incorporated into this policy and further detailed in
departmental procedures and grant documentation. Departmental responsibilities include:
Protecting assets under departmental control and maintaining adequate safeguards
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
4
Ensuring assets are used solely for authorized City purposes
Promptly notifying Administrative Services of acquisitions, transfers, disposals,
impairments, or other changes in asset condition
Maintaining supplemental tracking logs for sensitive or federally funded assets,
including those below capitalization thresholds (e.g., minor asset tracking).
Internal Control and Segregation of Duties: Custodial and operational control resides with
departments, while financial reporting and accounting control is maintained by
Administrative Services. This segregation of duties strengthens internal controls by reducing
the risk of error or fraud, enhancing auditability, and promoting consistency in Citywide
financial reporting. Departments are responsible for conducting physical inventories and
maintaining operational asset records, whereas Administrative Services consolidates,
verifies, and records asset transactions in the City’s financial system.
V. CAPITALIZATION THRESHOLDS
Assets with an estimated useful life greater than two years that meet the established
capitalization thresholds below are recorded as capital assets; all others are expensed.
Asset Class Threshold
Land $0 (all land is capitalized)
Land Improvements $50,000
Buildings and Improvements $25,000
Infrastructure $100,000
Construction in Progress (CIP) Determined by the final class
threshold.
Machinery, Equipment, and Vehicles $25,000
Furniture and Fixtures $25,000
Technology Assets (computers, printers, etc.) $10,000
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
5
Asset Class Threshold
Computer Software, Right-to-Use Assets, and Other
Intangible Assets $50,000
These thresholds align with those used by many municipalities across California while
maintaining practical, scalable ranges appropriate for the City of Atascadero. The intent is
to ensure that capital asset reporting focuses on items of material financial significance and
to minimize administrative e ort spent tracking assets that are not materially impactful.
Capitalization thresholds are applied to the unit cost of an asset. Costs associated with
components of a single, integrated asset are treated as part of the whole unless separately
capitalized under the City’s componentization policy (Section VII). Bulk purchases of
identical low-value items are generally expensed unless the aggregate grouping meets the
criteria for capitalization under GASB’s aggregation guidance (Section IX).
VI. VALUATION (HISTORICAL COST)
Capital assets are recorded at historical cost, which includes:
Purchase price, including applicable sales tax
Freight and shipping charges
Installation and testing costs
Professional services (e.g., architectural and engineering fees)
Permits and insurance during construction
Other expenditures incurred to place the asset into service
Discounts, allowances, and rebates are deducted from the asset’s cost. Assets exchanged
through trade-in transactions are removed from the capital asset system, and the
replacement asset is recorded at its full acquisition cost.
Donated assets are recorded at their fair market value as of the date of acceptance, plus any
ancillary costs needed to place the asset into service. Departments accepting donations
must provide Administrative Services with su icient written documentation such as
valuations, asset descriptions, and location information in order to establish the capital
asset record.
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
6
Capitalization is limited to costs necessary to acquire the asset and place it into service.
Since training does not extend the asset’s life, increase its capacity, or improve e iciency
beyond original design, it must be recorded as an operating expense and should not be
capitalized. Routine maintenance keeps an asset in a usable, working state, does not add
significant new capabilities, and does not extend the useful life beyond its original
expectation, and therefore is also expensed and not capitalized.
VII. COMPONENTIZATION
Where practical, major components will be recorded as separate capital assets, each with
its own useful life and depreciation schedule. This practice improves valuation accuracy and
simplifies tracking future replacements.
When a component is replaced, the old component will be retired, removing its historical
cost and accumulated depreciation from the asset records. The new component will be
capitalized, provided the replacement meets the City’s capitalization threshold. If a building
is recorded as a single, non-componentized asset, replacement of subcomponents may be
treated as repairs and expensed, unless the replacement increases capacity, improves
e iciency, or extends the useful life of the overall building (see Section XIV).
VIII. DEPRECIATION
The City uses the straight-line method of depreciation for all depreciable assets.
Depreciation begins when an asset is placed into service, and the City records a full year of
depreciation in the year the asset becomes operational, regardless of the specific month
placed into service. Land, certain land improvements with permanent benefits such as
grading or fill not subject to deterioration, inexhaustible works of art, and historical treasures
are asset types that are not depreciated. The annual depreciation amount remains constant
over the asset’s established useful life, unless otherwise directed by Administrative Services
based on updated asset information or life-extending improvements.
Useful Life Ranges:
Asset Class Useful Life
Buildings and Improvements 5–50 years
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
7
Asset Class Useful Life
Infrastructure 5–100 years
Machinery, Equipment and Vehicles 2–30 years
Furniture and Fixtures 2–10 years
Technology Assets (computers, printers, etc.) 2–10 years
Computer Software, Right-to-Use Assets, and Other Intangible Assets 2–10 years
Administrative Services may set specific useful lives for capital assets considering vendor
recommendations, engineering assessments, industry standards, and the City’s historical
experience with similar assets. These assigned useful lives ensure that depreciation
accurately reflects the asset’s expected service capacity.
Administrative Services may approve documented exceptions to standard useful lives when
justified by actual usage patterns, asset condition, environmental exposure, operational
intensity, or applicable legal or contractual limitations. Approved exceptions must be
supported with appropriate documentation and retained with the asset record.
IX. AGGREGATE PURCHASES
The City will capitalize aggregate purchases of low-value units when the items, although
individually below the capitalization threshold, are significant in total. This requirement
applies when similar assets are acquired as a group, near the same time, and for a single
operational objective. Examples include but are not limited to bulk purchases of laptops or
computers, o ice furniture sets acquired together, and specialized equipment purchased in
coordinated batches. Management will evaluate these grouped purchases to determine
whether the collective cost meets the City’s definition of ‘significant’. When it does, the
group will be recorded as a capital asset, ensuring the City’s financial statements fairly
represent long-term resources and comply with GASB.
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
8
X. ACQUISITION, SELF-CONSTRUCTED ASSETS AND CONSTRUCTION IN PROGRESS
All capital acquisitions must follow the City’s established purchasing procedures, including
budget authorization, procurement requirements, and purchase order processing.
Administrative Services is responsible for validating that the purchase qualified as a capital
asset, establishing the appropriate useful life, and recording the asset in the City’s financial
system. All lease and subscription agreements must be submitted to Administrative
Services for a right-to-use evaluation in accordance with relevant GASB guidance.
Self-Constructed Assets: For assets constructed by City sta , all costs are accumulated
in the related project accounts. Capitalizable costs may include direct labor at fully
allocated rates, materials and supplies, equipment usage and administrative overhead that
is directly attributable to construction activities and originates outside the construction cost
center. Upon the project’s completion and readiness for service, the accumulated
construction costs are transferred to the appropriate capital asset class. Consistent with
GASB Statement No. 89, interest costs incurred during construction are expensed, not
capitalized.
Construction in Progress (CIP): CIP represents new construction, major improvements,
purchases, or capital activities that are not yet complete or not fully processed by fiscal year-
end. CIP is used only when the project is expected to exceed the capitalization threshold of
the resulting asset class and when the asset is not yet substantially complete or in services
at year-end. When the project reaches substantial completion and is placed into service,
the CIP balance for that asset is reclassified to the appropriate capital asset category.
XI. INTANGIBLE ASSETS
Easements/Right-of-Way: Permanent easements shall be capitalized regardless of cost, as
they convey perpetual rights that meet the criteria for intangible assets. Right-of-way
acquisitions are capitalized when they meet the City’s capitalization threshold for
land-related intangibles.
Computer Software: Software accounting follows GASB’s distinction between
development stages. Preliminary project stage activities-such as needs assessments and
feasibility studies-are expensed. Post-implementation activities-including maintenance,
patches, and minor updates-are also expensed. Software acquired as part of an integrated
system may be grouped with hardware when the combined system functions as one
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
9
operational unit and when the combined acquisition meets the capitalization threshold (see
Section IX on aggregate purchases).
Other Intangibles: Intangible assets lacking physical substance, used in operations, and
meeting the asset definition under GASB 51 such as certain rights, licenses, trademarks,
permits, or internally developed software will be capitalized.
XII. RIGHT-TO-USE-ASSETS
Leases (GASB 87):
A right-to-use lease asset and corresponding lease liability must be recognized for all
non-cancelable lease terms greater than 12 months. The lease asset is measured at the
present value of required payments and amortized over the shorter of the lease term or the
asset’s useful life. Short-term leases (12 months or less) are expensed as incurred. The
threshold is $50,000. Departments must submit all lease contracts to Administrative
Services for review and recording.
SBITA (GASB 96):
A subscription asset and liability must be recognized for qualifying software subscription
arrangements with non-cancelable terms greater than 12 months and meeting the $50,000
threshold. The subscription asset is amortized over the subscription term. Short-term
arrangements are expensed as incurred. Departments must submit all agreements to
Administrative Services for review.
Public-Private/Public-Public Partnerships (PPPs):
Administrative Services evaluates PPPs and other complex arrangements that convey
control to determine whether recognition of right-to-use assets or other capital assets and
related liabilities is required.
XIII. ACCEPTANCE OF PUBLIC IMPROVEMENTS (DEVELOPER DONATIONS)
Public infrastructure constructed by developers and formally accepted by the City shall be
recorded at the developer’s actual construction cost (historical cost). When such costs
cannot be reasonably determined, assets shall be recorded at fair value as of the
acceptance date. Land contributed as part of a development project shall be recorded
separately as a non-depreciable asset.
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
10
Departments must submit standardized asset information including asset type, quantities,
location, acceptance date, and associated costs to Administrative Services to ensure timely
and accurate entry into the financial system. This documentation supports proper valuation
of donated assets and enables depreciation to begin promptly when assets are placed into
service.
XIV. COSTS SUBSEQUENT TO ACQUISITION (MAINTENANCE VS. CAPITAL)
Subsequent expenditures shall be capitalized when they meet the applicable asset class
threshold and result in one or more of the following:
a) an extension of the asset’s useful life,
b) an increase in capacity or operating e iciency, or
c) the addition of a major component.
Examples include roadway base reconstruction, bridge seismic retrofits, and significant
building system replacements such as roofs, HVAC systems, or electrical upgrades.
Routine maintenance activities such as repainting, standard flooring replacement, or minor
road repair are expensed as they occur. These activities preserve existing service levels but
do not increase service potential or extend useful life; therefore, they do not meet
capitalization criteria.
All capitalization determinations must be supported by appropriate documentation
demonstrating how the expenditure a ects future service potential. Departments should
consult with Administrative Services when classification is uncertain.
XV. INVENTORY
Frequency
• Capital Assets: Perform a comprehensive verification annually, or as directed by
Administrative Services.
• Federal/Grant-Funded Assets: Inventory every two years in accordance with Title 2 CFR
200.313.
Process
Administrative Services will supply each department its inventory listings at the end of each
fiscal year. Departments are responsible for:
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
11
• verifying the physical existence of each asset,
• updating serial numbers, locations, and other identifying details,
• documenting disposals and transfers, and
• timely returning signed and completed inventory forms to Administrative Services.
Administrative Services reconciles discrepancies, updates the capital asset records, and
conducts follow-up procedures for missing or unverified items. Departments will also
maintain a Minor Asset Tracking Log for sensitive or high-risk items below capitalization
thresholds via the Asset Management Software platform.
XVI. FEDERAL AND GRANT-FUNDED PROPERTY
Assets acquired with federal funds must comply with Title 2 CFR 200.313 (Property
Standards), including requirements for asset records, internal controls, physical inventory
frequency, and disposition procedures. Departments are responsible for reviewing
applicable grant agreements prior to initiating any equipment purchases and coordinating
with Administrative Services to ensure accurate reflection of ownership, use restrictions,
and reporting obligations within the City’s financial system.
When grantor requirements di er from City policy such as a lower asset-tracking threshold,
departments must follow the stricter requirement while maintaining consistency with
Citywide capital asset accounting and reporting standards.
XVII. IMPAIRMENTS AND ASSET RETIREMENT OBLIGATIONS (ARO)
Impairments (GASB 42)
A capital asset must be evaluated for impairment when there is a significant and
unanticipated decline in service utility resulting from events such as physical damage,
technological obsolescence, environmental or legal changes, or fundamental shifts in
usage. When an impairment is identified, the City shall recognize the loss in accordance with
GASB 42, documenting the triggering event, the measurement approach, and any potential
recovery. Administrative Services performs annual assessments and conducts reviews
whenever a triggering event occurs.
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
12
Asset Retirement Obligations (GASB 83)
An Asset Retirement Obligation must be recognized when the City has a legally enforceable
duty to retire a tangible capital asset. The liability and corresponding deferred outflow of
resources are recorded upon the obligating event such as acquisition, construction, or
placement into service and updated as cost estimates change. Departments must
coordinate with the City Attorney and City Manager’s O ice to identify legal obligations,
technical requirements, and other assumptions.
Insurance Recoveries
When an impairment involves an insurable event, recoveries shall be recognized and
disclosed in accordance with GASB 42 and the City’s accounting procedures. Departments
must coordinate with Risk Management and Administrative Services to ensure that
recognition, classification, and disclosure of insurance proceeds are accurate and
consistent.
XVIII. TRANSFERS, DISPOSALS AND SALES
Authorization and Process:
Departments must submit an Idle Equipment Report to Administrative Services when
proposing the transfer, disposal, or sale of a capital asset. The report must include all
required details including asset number, description, serial number, location, condition,
date, and proposed method of disposition in accordance with the City’s Purchasing Policy.
Administrative Services is responsible for authorizing the disposition method and ensuring
compliance with City procedures, including proper financial recording.
Accounting Requirements
Upon retirement of an asset, Administrative Services will remove the asset and its
accumulated depreciation from the City’s capital asset records and recognize any resulting
gain or loss. For assets sold or auctioned, proceeds must be deposited into the fund that
originally financed the purchase. Departments must forward all supporting sale
documentation (such as auction reports or receipts) to Administrative Services to facilitate
accurate retirement entries.
Lost or Stolen Assets
Missing assets must be reported immediately. Departments are required to complete an Idle
Equipment Form and coordinate with the Police Department or Risk Management when
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3
City of Atascadero
Capital Asset Policy
May 12, 2026
13
applicable. Administrative Services will update capital asset records and determine whether
additional disclosure or documentation is required.
XIX. FINANCIAL REPORTING
Administrative Services is responsible for reporting capital assets in the City’s Financial
Statements, including beginning balances, additions, disposals, transfers, depreciation
expense, and ending balances by function or program. The accompanying notes disclose
capitalization methodologies, useful lives, impairment evaluations, right-to-use assets,
SBITAs, and all other disclosures required under GASB.
Administrative Services also maintains detailed subsidiary ledgers and schedules by asset
class and fund to support financial reporting, audit requirements, budgeting, risk
management, and insurance valuations. Departments play a critical role in year-end
reporting by submitting complete and timely documentation including acceptance records
for developer-constructed assets, disposal forms, and updated inventory verification to
ensure the accuracy and completeness of capital asset records.
XX. REVIEW AND UPDATES
Administrative Services conducts periodic reviews of this policy and updates it as necessary
to reflect changes in GASB standards, federal and state guidance, operational requirements,
and recognized best practices. Updates may include revisions to capitalization thresholds,
adjustments to estimated useful lives, or enhancements to procedures designed to
strengthen e iciency, internal controls, and compliance.
Resolution No. 2026-029
Exhibit A
Docusign Envelope ID: E2ABFD80-EF08-8B88-83B7-C47466A4F5D3