Local Bond Law Questions Flashcards
The Local Bond Law, specifically NJ SA 40A:2-4 authorizes a local unit to pay any and all bonds and notes issued by it, The limit is:
unlimited
In a case of municipality, the Local Bond Law NJSA 40A:2-6 sets the debt limit at a an amount not to exceed what percentage of the average of the preceding 3 years equalized assessed valuation:
3 1/2 %
A local unit, in anticipation of the issuance of bonds, may borrow money and issue notes if the bond ordinance or subsequent resolution so provides. Such notes shall be designated as a “bond anticipation note” and all such notes shall mature and be paid not later than the first day of the fifth month following the close of which fiscal year?
10th Fiscal Year
BANs issues in compliance with the requirements of NJSA 40A:2-8.1 require no principal payments until the notes obtain their maximum number of renewal permitted by law - True or False
False
This statement must be filed in the Office of the Clerk by the financial officer prior to the passage of first reading of any bond ordinance or ordinance amending a bond ordinance except if the bond ordinance does not increase the total amount of the obligations authorized.
Supplemental Debt Statement
Local Bond Law NJSA 40A:2-10, requires a down payment to be appropriated for the purpose of authorized in the respective bond ordinance. Said down payment shall not be less than 5% of amount of the obligations authorized. The down payment must be made available prior to final adoption of the bond ordinance and the source of the down payment may be from moneys previously contributed for such purpose as included in the bond ordinance - True/False
True
According to the Local Bond Law NJSA 40A:2-12, a bond ordinance shall contain in substance which of the following:
All of the above:
- an authorization for issuance of obligations
- an authorization for the assumption by the local unit of the obligations of an authority to be dissolved
- a determination of the period of usefulness
The maximum number of annual installments in which obligations for special assessments may be paid cannot exceed how may years
20 years
Which of the following statements would be true according to NJSA 40A:2-17 (The Local Bond Law)
A bond ordinance may be introduced by title and approved by majority vote of the full membership
The Local Bond Law, specifically 40A:2-20 permits inclusion of expenses associated with the purpose of a capital project. Some of these expenses are architect’s fees, accounting, engineering and inspection costs. In addition it is permitted to include the interest on obligations until the end of the fiscal year in the year of issue. True/False
True
When the governing body has concluded that the limitations as to maturities as stipulated by NJSA 40A:2-26 will adversely affect the financial position of the local unit. The limitation causing the adverse condition, is that no annual installment for debt service shall exceed by more than what percentage of the smallest prior installment?
100%
Which of the following is a permitted exception for permitting bonds to be sold at private sale?
All of the above
- If all or part of an authorized issue is $1,000,000 or less
- If sold to the local School District
- If no bids were received at the public offering and the private sale is within 30 days after the advertised date for public bidding
The requirement per NJSA 40A:2-31 regarding the contents for notice of sale of bonds are; the terms and conditions of such public sale only. True/False
False
Bidders for the sale of bonds shall be required to deposit a certified or cashier’s or treasurer’s check for what amount?
Equal to not less then 2% of the bonds
The Local Bond Law prohibits the issuance of certain agreements from being authorized as it relates to the issuance or sale of obligations. One such prohibited agreement addresses the restriction on the deposit of moneys received from such sale. True/False
True
