Budget Law

Question 1

The Local Budget Law, NJSA 40A:4-3.1(b) requires any municipality deciding to convert to a State Fiscal Year from a Calendar Fiscal Year perform the following:

Answer 1

Apply to the Local Finance Board; prepare a transition year budget

Question 2

When converting to a State Fiscal Year calendar from a Calendar Year a municipality may do so by which of the following:

Answer 2

Ordinance

Question 3

All budgets shall be introduced, approved, amended and adopted by what vote and by which action of the governing body?

Answer 3

By resolution passed by not less than a majority vote of the full membership of the governing body.

Question 4

NJSA 40A:4-5 sets the introduction dates for the municipal budget for both a Calendar Year and State Fiscal Year community. The statutory introduction dates are as follows:

Answer 4

Calendar Year - February 10

State Fiscal Year - August 10

Question 5

A municipal governing body has introduced their town budget on Thursday, February 6 and will hold a public hearing on said budget on Thursday, March 6 (non-leap year). The advertisement giving notice of the public hearing shall not be published later than which date?

Answer 5

February 24

Question 6

Using the identical dates as presented in question number 5. Would the minimum number of days required between approval and adoption been satisfied as stipulated in the Local Budget Law, 40A:4-77

Answer 6

Yes, requirement satisfied 2/6-3/6 29 days

Question 7

According to NJSA 40A:4-9, concerning amendments to an introduced budget, an increase or decrease to any item of appropriation by more than five percent (5%) would require a public hearing on said amendment.

Answer 7

False

Question 8

The amount to be raised by taxes for school purposes, required to be certified to the governing body of a municipality for inclusion in its budget, shall set forth in a separate section of the budget upon adoption and shall be added to the amount to be raised by taxes by which of the following:

Answer 8

School tax rate

Question 9

The governing body may by resolution authorize temporary budget appropriations to provide for the period between the beginning of the fiscal year and the adoption of the budget. The resolution shall be adopted within how many days of the beginning of the fiscal year?

Answer 9

30 days

Question 10

Nothing in the Local Budget Law, specifically as stated in NJSA 40A:4-19 shall prevent or relieve the governing body from making appropriations during the last 10 days of the year preceding the beginning of the fiscal year for all capital improvement fund purposes.

Answer 10

False - Appr for debt service

Question 11

When emergency temporary appropriations are adopted after the introduction and approval of the budget and were not included in the budget as approved, the temporary emergency appropriation shall be included by amendment.

Answer 11

True

Question 12

Which of the following is known as, in the current section of accounts shall consist of the excess of quick assets such as cash, investments, State or other public aid receivable, and deferred charges over legal and demand liabilities.

Answer 12

Surplus

Question 13

Which of the following is known as revenue amounts that may reasonably be expected to be realized in cash during the fiscal year from known and regular sources, or from sources reasonably capable of anticipation

Answer 13

Miscellaneous Revenues Anticipated

Question 14

Miscellaneous revenues when being anticipated in the municipal budget are regulated by NJSA 40A:4-26. This section of the statute limits anticipated revenues to the amount:

Answer 14

Actually realized in cash from the same source in the next preceding fiscal year.

Question 15

A municipal governing body has determined that a parcel of land is no longer required for public use and so concluded that said parcel be sold at auction. The parcel of land will generate sale proceeds that would benefit town property owners if anticipated in the municipal budget as a revenue. In order for the proceeds to be an anticipated revenue in the budget the obligation to make payment to the municipality must be entered into:

Answer 15

Prior to the adoption of the budget.

Question 16

When a municipality has a sinking fund cash surplus, such surplus may, upon written application by the sinking fund commission and the approval of the director, be used, in whole or in part, as which of the following according to NJSA 40A:4-28

Answer 16

An anticipated miscellaneous revenue in current fund budget

Question 17

NJSA 40A:4-30 describes the amount to be raised by taxes as the amount required to be levied by taxation for support of the municipal budget. It is the difference between the total of all general municipal budget appropriations, including Chapter 6 school debt service and such deferred charges and statutory expenditures for Chapter 6 schools as are required to be raised in the municipal budget, less the total of anticipated revenues.

Answer 17

True

Question 18

To the extent there is available surplus revenue collected by a municipality for supplying a utility service which is regulated by the Board of Public Utilities an amount of this utility surplus may be transferred annually and included in the local municipal budget. This amount of surplus to be utilized may not exceed what percentage of the annual costs of operation of the utility?

Answer 18

5%

Question 19

Dedicated revenues (dedication by rider) stated in the budget shall be classified according to their respective sources and shall be stated in a separate section of the budget, together with the appropriations to the purpose to which such dedicated revenues are applicable. The total of anticipated revenues must equal the total of appropriations. This definition would describe which of the following:

Answer 19

Trust Fund accounts

Question 20

Which of the following would meet the standard to qualify as a dedicated revenue as described in the previous question?

Answer 20

Animal Control Fund
Sinking fund for term bonds
A bequest
Motor vehicle fines dedicated to road repairs
All of the above

Question 21

An appropriation for “cash deficit of preceding year” shall be raised how?

Answer 21

In full the immediate successive year of the deficit

Question 22

A Capital Budget adopted by the governing body authorizes the expenditure of public funds.

Answer 22

False

Question 23

NJSA 40A:4-45.2a authorizes that amounts of revenue generated by an increase in its valuations based solely on applying the preceding year’s local purposes tax rate of the municipality to the assessed value of new construction or improvements will result in

Answer 23

Increase the “CAP” base

Question 24

Which of the following groups of appropriations are exceptions to the budget “CAP” or also known as outside “CAP” appropriations.

Answer 24

• Debt Service, capital expenditures, amounts expended to fund a free public library
• Reserve for uncollected taxes, SOCIAL SECURITY, federal grants, amounts to meet NJ Public Employees’ Occupational Safety and Health Act
• PUBLIC EMPLOYEES RETIREMENT SYSTEM, expenditures resulting from the impact of a hazardous waste facility, MUNICIPAL COURT operations

Question 25

Unless emergency expenditures are eligible for bonding pursuant to the Local Bond Law, said expenditures shall be provided in full by the governing body as a deferred charge in the budget of the next succeeding fiscal year.

Answer 25

True

Question 26

A resolution authorizing the adoption of an emergency appropriation shall be adopted by what vote of the municipal governing body?

Answer 26

Two-thirds vote of the full membership of the governing body.