Item 5: Resolution on Receipt of FY12 URA Financial Report

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URBAN RENEWAL AGENCY OF THE CITY OF EUGENE, OREGON Notes to Basic Financial Statements (1) Summary of Significant Accounting Policies, continued (F) Receivables All receivables are shown net of an allowance for uncollectibles in the Statement of Net Assets and the Governmental Funds Balance Sheet. (G) Capital Assets Capital assets are defined as tangible or intangible assets that are used in operations and that have initial useful lives extending beyond a single reporting period. The capitalization threshold for capital assets is $5,000. Tangible assets include land, rights-of-way (included with land), improvements, and infrastructure. Except for infrastructure placed in service prior to July 1, 1980, all capital assets have been capitalized in the government-wide financial statements. In accordance with the current financial resources measurement focus, capital assets are not capitalized in the governmental fund financial statements. All purchased capital assets are valued at historical cost. Historical cost is measured by the cash or cash equivalent price of obtaining an asset, including ancillary charges necessary to place the asset into its intended location and condition for use. Additions, improvements, and other capital outlays that significantly extend the useful life of an asset are capitalized. Amounts expended for maintenance and repairs are charged to expenditures in the appropriate funds as incurred and are not capitalized. Capital assets are depreciated unless they are inexhaustible in nature or have an indefinite useful life (e.g., land and rights-of way). Depreciation is an accounting process which allocates the cost of capital assets, in a rational manner, to those periods expected to benefit from the use of the capital assets. Depreciation is notintended to represent an estimate in the decline of fair market value, nor is capital assets, net of accumulated depreciation, intended to represent an estimate of the current condition of the assets, or the maintenance requirements needed to maintain the assets at their current level of condition. Depreciation is computed over the estimated useful lives of the capital assets. All estimates of useful lives are based on actual experience by City departments with identical or similar capital assets. Infrastructure assets are depreciated using a composite depreciation method. All other categories of assets are depreciated on the straight-line basis of accounting. The estimated useful lives of the various categories of assets are as follows: Estimated Category useful life Improvements 20 years Infrastructure 25 years Upon disposal of capital assets, cost and accumulated depreciation are removed from the accounts and, if appropriate, a gain or loss on the disposal is recognized. Capital assets are reported net of accumulated depreciation in the Statement of Net Assets, and depreciation expense is reported in the Statement of Activities in the urban renewal redevelopment function. continued