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Municipal Budget Process > Mid-Term Study Guide > Flashcards

Mid-Term Study Guide Flashcards

1
Q

Where is the basis for municipal budgeting in NJ found and what is the statute?

A

Local Budget Law

N.J.S.A. 40A:4-1

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2
Q

Name the parts of this statute - 40A:4-1

A

40A - Title
4 - Chapter
1 - Section

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3
Q

What is the budget coded by and what does this do?

A

Flexible Chart of Accounts

It categorizes budget appropriations and revenues with a high degree of flexibility

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4
Q

How many digits does the County FCOA include?

How many digits does the Municipal FCOA include?

A

16 digits

13 digits

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5
Q

Gives examples of Coding

A

S/W: 20-100-1 (Salary & Wages)

O/E: 20-100-2 (Other Expenses)

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6
Q

What is the equation for Amount to be Raised by Taxation?

A

Appropriations minus Anticipated Revenues = Amount to be raised by taxation

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7
Q

When must the budget be introduced?

A

No later than February 10th

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8
Q

How many copies of the budget must be filed with the Director of the DLGS?

Within how many days AFTER the budget is introduced must the copies by filed?

A

3 copies

Within 3 days

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9
Q

How many days prior to the public hearing must the budget be published?

How many days after the approval of the budget must the public hearing be?

A

At least 10 days prior

At least 28 days AFTER the approval

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10
Q

When can the budget be adopted?

A

March 20th

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11
Q

How many certified copies of the adopted budget must be filed with the division?

How many certified copies of the adopted budget must be filed with the county board of taxation?

A

3 copies to the division

1 copy to the county board of taxation

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12
Q

Who must the budget be adopted by?

A

A majority of the full membership of the governing body

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13
Q

A resolution that is a request to the Director to approve in the budget of a local unit dedicated revenues anticipated to be received during the year, which are not subject to a reasonably accurate estimate in advance

A

A Dedication by Rider

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14
Q

What did SFY municipalities need to adopt to account for the expenditures in the beginning of the year?

What months were covered?

A

Transitional Year Budget

January 1 through June 30

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15
Q

A unit of information presented in a document, the official budget, shown on a separate line of its own. It usually refers to different elements of a classification or group and help track and monitor available funds, revenues, and expenses by type.

A

Line Item

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16
Q

Transfers between budgets are called:

A

Budget Transfers

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17
Q

Transfers from budget appropriations are permitted during the ____ of the fiscal year and during the _____ of the succeeding year.

A

Last two months

First three months

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18
Q

Regarding budget transfers, the governing body must adopt a transfer resolution by what?

A

2/3 vote of the full membership

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19
Q

Budget transfers between appropriations excluded from the cap to inside the cap?

A

NO

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20
Q

Budget transfers between appropriation excluded? (Out to Out)

A

NO

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21
Q

Budget transfers made from appropriations inside the cap to outside the cap?

A

YES

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22
Q

A method of amending the budget that allows the Director to approve the insertion of any special item of revenue, such as grant funds, in the budget of any local unit when such item shall have been made available by law.

Which chapter and section of the NJSA provides this method?

A

Chapter 159 method

4-87

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23
Q

The official permanent financial record of the local unit, which provides a summary of all financial transactions as they have been recorded in the books of original entry utilizing a double entry accounting system

A

General Ledger

24
Q

Used to finance the 6 months after switching to SFY and adopting a transitional year budget to account for the expenditures from 1/1 to 6/30.

A

Fiscal Year Adjustment Bonds

25
Q

Normally, the Director of DLGS conducts the annual budget examination. A rotating process that is done with the Director examining only a portion of municipalities is also known as a:

A

Self-examination

26
Q

During the self-examination process, the Director examines what percentage of municipalities?

What percentage could be eligible for self-examination?

A

1/3 of municipalities

2/3 eligible for self-examination

27
Q

The Local Budget Law requires the budget message, at a minimum, contain an explanation of the cap and a summary of appropriations appearing in both the “inside” and “outside” the cap sections of the budget for both ____ and ____.

A

Appropriation CAP - 1977 (CAP LAW)

Tax Levy CAP

28
Q

Every municipality must adopt a ______, within ____ days, during the period of Jan 1 to June 30 to cover commitments from the beginning of the year to the date of the budget adoption.

A

Temporary Budget

First 30 days

29
Q

The total of the appropriations adopted in the temporary budget cannot exceed ____% of the total of all budget appropriations of the preceding year, excluding what three appropriations?

A

26.25%

Appropriations for debt service

Capital Improvement Fund

Public Assistance

30
Q

The law limits the amount of increase in appropriations from year to year to ____% of the previous year’s final appropriations or the municipal price deflator index, whichever is less.

A

2.5%

31
Q

A municipality may by ordinance, or county by resolution, increase the _____ percentage up to ____% or bank for up to two years, the difference between its final appropriation subject to the cap and this percentage.

The banking is known as:

A

Cost of Living Adjustment (COLA)

3.5%

CAP banking

32
Q

The governing body may amend the budget. No amendment will become effective without a public hearing and publication of the amendment, if the amendment:

  1. Adds a new item of appropriation in an amount in excess of ___% of the total of appropriations as stated in the approved budget.
  2. Increases or decreases any item of appropriation by more than __%.
  3. Increases the amount to be raised by taxation more than __%, unless the same is made to include an emergency appropriation.
A
  1. 1%
  2. 10%
  3. 5%
33
Q

An appropriation of not more than __% of the total budget appropriations for operations may be made for ____, which are non-recurring unforeseen expenditures

A

3%

Contingencies

34
Q

________ is an item in the budget which has a useful life of at least ___ years, and for which noted or bonds can be sold. Under this section of the budget, funds can be placed here to provide for the ___% down payment required on when financed by bonds and notes.

A

Capital Improvements

5 years

5%

35
Q

Appropriations for deferred charges are made to cover emergency authorizations and over expenditures. Special emergencies, tax maps, etc. may be spread over 5 years in equal installments. __________ consist of pension and social security costs.

A

Statutory Expenditures

36
Q

In municipalities with a _______, provision must be made in the municipal budget for school debt service.

A

Type 1 School District

37
Q

A “non-spending” appropriation to insure that a municipality will have sufficient cash to pay the county, school, and special district taxes. Its purpose is to offset the difference between a full 100% collection and the actual collection of taxes during the budget year.

A

Reserve for Uncollected Taxes

38
Q

The Capital Program is a multi-year plan and schedule for capital projects with a prospective useful life of greater than __ years and a cumulative annual cost of $____.

A

5 years

$25,000

39
Q

_________ may be issued in an aggregate amount not exceeding _______ of the equalized assessed valuation basis

A

Capital Notes

The lesser of $200,000 or 1/2 of 1%

40
Q

New Jersey municipalities use a _______ budgeting system and a _________ system.

A

Cash Basis

Modified Accrual Basis Accounting

41
Q

The modified accrual accounting system is also referred to as ___________.

A

Other Comprehensive Basis of Accounting (OCBOA)

42
Q

The Local Property Tax in New Jersey is considered an ______, meaning that each taxpayer shares in the total tax burden of the town in the direct proportion to the value that his/her property bears to the total value of all the property in town.

A

Ad Valorem Tax

43
Q

The Annual Audit is required by the Local Fiscal Affairs Law _______ after the close of the Fiscal Year.

A

180 Days

44
Q

Budget transfers made from inside the cap to inside again?

A

YES

45
Q

Emergency appropriations subject to Local Finance Board approval, such as damage to roads or bridges by snow, ice, etc. and public exigencies caused by civil disturbances

A

3 Year Special Emergencies

46
Q

Emergency appropriations, such as preparation of an approved tax map, revaluation of real property, revision and codification of its ordinances, preparation of a sanitary or storm sewer system map

A

5 Year Special Emergencies

47
Q

_______ revised the contribution requirements for health benefits contributions

A

Chapter 78

48
Q

The difference between assets and liabilities is also known as

A

Fund Balance

49
Q

This law imposes a ___% cap on the increase in local government tax levies subject to certain exceptions.

A

2%

Levy CAP Law- 2010

50
Q

Regarding Bond Issuance, _____ is paid once a year and _____ is paid twice a year.

A

Principal

Interest

51
Q

TAD 85-1
TAD 85-2
TAD 85-3

A

1 - Encumbrance Accounting
2 - Fixed Asset Accounting
3 - General Ledger

52
Q

How much of a down payment is required for all Bond ordinances?

A

5%

53
Q

An item that has a useful life of at least five years, and for which bonds or notes can be sold

A

Capital Improvement

54
Q

How long of a plan should the municipality have when requesting to spend funds from the capital improvement fund?

A

3-year-plan for population less than 10,000

6-year-plan for population greater than 10,000

55
Q

One Tax Point =

A

One Ten Thousandth

56
Q

When is the Annual Financial Statement due?

A

February 10

57
Q

How many days to file the audit?

A

180 days

Municipal Budget Process (3 decks)

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