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Indian River County, Florida Notes To Financial Statements Year Ended September 30, 2010 NOTE 1— SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES — Continued D. Assets, Liabilities, and Net Assets or Equity - Continued 7. Other Assets Held For Resale This account represents assets the County has purchased with the intent to resell. In fiscal year 2009, the County was allocated $4.6 million from the U.S. Department of Housing and Urban Development's Neighborhood Stabilization Program under a Community Development Block Grant. This funding was to be used by local governments for acquiring, redeveloping, and reselling foreclosed properties that might otherwise become sources of abandonment within their communities. The County purchased sixteen homes under this program and intends to resell them within the next fiscal year. They are reported at the lower of cost or market value on the balance sheet of the County's governmental funds. 8. Restricted Assets Certain net assets of the County are classified as restricted assets on the statement of net assets because their use is limited either by law through constitutional provisions or enabling legislation; or by restrictions imposed externally by creditors, grantors, contributors, or laws or regulations of other governments. In a fund with both restricted and unrestricted assets, qualified expenses are considered to be paid first from restricted net assets and then from unrestricted net assets. Further information on the restrictions can be found in Note 21. 9. Capital Assets Capital assets, which include property, plant, equipment, infrastructure (e.g., roads, bridges, right-of- ways, water and sewer distribution systems, beach restoration, stormwater systems and similar items), and intangible assets (e.g. software, easements, and rights), are reported in the applicable governmental or business -type activities column in the government -wide financial statements. The County defines capital assets as assets with an initial, individual cost of $1,000 or more and an estimated useful life in excess of one year. Except for roads and bridges constructed prior to October 1, 1981, assets are recorded at historical cost. Roads and bridges constructed prior to October 1, 1981 are reported at estimated historical cost. Donated capital assets are recorded at estimated fair market value at the date of donations. Transfers of capital assets within the County are recorded at their carrying value at the time of the transfer. The costs of normal maintenance and repairs that do not add to the value of the asset nor materially extend its useful life are not capitalized. Major outlays for capital assets and improvements are capitalized as projects are constructed. Interest incurred during the construction phase of capital assets of business -type activities is included as part of the capitalized value of the assets constructed. The Board holds legal title to the capital assets used in the operations of the Board, Clerk of the Circuit Court, Property Appraiser, Supervisor of Elections and Tax Collector, and is accountable for them under Florida Law. 52