Attachment 1
Equipment Replacement Fund
This fund was established to provide for the timely and orderly replacement of equipment valued over $5,000. This internal service fund allows the City to plan ahead for the replacement of its equipment. The expenditure figure represents the schedule of equipment to be replaced during the fiscal year and deemed to be in need of replacement.
A consistent methodology is used to capture replacement funds for operating department replacement needs. Individually significant assets (over $5,000), or a pool of assets (which may be less than $5,000 individually, but when pooled together exceed $5,000) are assigned replacement values and estimated useful lives. Operating departments are then charged an annual replacement charge such that the replacement value is available upon expiration of the asset. Any changes to replacement values and/or estimated useful lives that occur subsequent to the asset being placed on the Equipment Replacement list are handled on a prospective (or “go-forward”) basis.
This fund accounts for replacement of assets other than those assets related to Water Operations or Wastewater Operations (which are accounted for in those respective Enterprise funds), or those assets specifically relating to the activities of Vehicle Replacement, Information Technology, and Building Maintenance