Midterm

Question 1

The Supplemental Debt Statement must be filed in the ___________.

Answer 1

The office of the clerk of the local unit

Question 2

The Supplemental Debt Statement must show what?

Answer 2

That the obligations authorized by the bond ordinance will be within debt limitations

Question 3

Describe some contents of a bond ordinance:

Answer 3

1. An authorization for the issuance of obligations.
2. Purposes for which the obligations are to be issued
3. A determination that the Supplemental Debt Statement has been filed in the office of the clerk
4. The estimated maximum amount of bonds or notes to be issued
5. The estimated cost of the purposes
6. The period of usefulness of the purposes

Question 4

A bond ordinance must be introduced in _____ at the meeting of the governing body and passed at _______ by _______.

Answer 4

1. In writing
2. The first reading
3. The majority vote, or 3/4, of the present members

Question 5

A bond ordinance must be published with notice of _____.

Answer 5

Its introduction and the date, time, and place of a hearing and further consideration for final passage

Question 6

The final passage of a bond ordinance must be at least ___ days after ____.

Answer 6

At least TEN days after INTRODUCTION

Question 7

A bond ordinance must be published ____ prior to the date for further consideration

Answer 7

At least one week prior

Question 8

Advertisement of a bond ordinance must be ___ days before hearing

Answer 8

10 days

Question 9

If an amendment to a bond ordinance is adopted, the ordinance cannot be finally adopted until ______ after such amendment and publication at least ____ prior to the date for further consideration

Answer 9

at least one week

2 days

Question 10

A bond ordinance will be finally adopted by the recorded affirmative votes of at least ______.

Answer 10

2/3 of the full membership of the governing body, whether or not all are present

Question 11

A Supplemental Debt Statement is prepared as of when?

Answer 11

As of the date of introduction

Question 12

How much is the down payment for a project?

Answer 12

5% of the bonds and notes being authorized

Question 13

Every bond ordinance must be published in full after ______.

Answer 13

Final adoption

Question 14

The bond ordinance will take effect ____ days after its first publication after final adoption

Answer 14

20 days

Question 15

When can bonds and notes be retired?

Answer 15

After the close of the 10th fiscal year

Question 16

The money in the Accrued Interest on Bonds account may be used to pay a portion of the interest on the bonds which falls due in the current year, _____ months after the date of the bonds, if the settlement occurs before ____.

Answer 16

6 months

July 1st

Question 17

If the settlement occurs during the last six months of the year and the bonds are dated after July 1, no interest will be payable during the current year. In this case, the amount in the Accrued Interest on Bonds account may be anticipated as ____ in the ____ to offset the budget appropriation for Interest on Bonds.

Answer 17

Revenue

Current Fund Budget

Question 18

Any premium received on the sale of bonds would be closed into ______ at the end of the current year

Answer 18

Capital Fund Balance

Question 19

A bond ordinance to authorize refunding bonds may not be adopted until approved by ______.

Answer 19

The Local Finance Board

Question 20

True or false: No Supplemental Dept Statement is required to be filed nor is a down payment required for a bond ordinance to authorize refunding bonds

Answer 20

True

Question 21

Temporary funding would describe what?

Answer 21

Bond Anticipation Notes

Question 22

The _____ of every municipality must make and file in the office of the clerk and the Director of the DLGS of the State an ______ as of the last day of the preceding fiscal year.

Answer 22

Chief Financial Officer

An Annual Debt Statement

Question 23

When must the CFO make and file the Annual Debt Statement?

Answer 23

Before the end of the first month of each fiscal year

Question 24

Bond Anticipation Notes may be issued for a period of not exceeding _______.

Answer 24

One year

Question 25

When must a Bond Anticipation Note be paid by?

Answer 25

1st day of the 5th month following the close of the 10th fiscal year of the original notes.

Question 26

Identify 2 items included in the publication of a bond ordinance

Answer 26

1. Total amount of the bonds

2. Date, time, and place of hearing

Question 27

What is the name given to a project that benefits an entire local unit?

Answer 27

General Improvement

Question 28

Identify several sources of funds down payments can come from:

Answer 28

1. Grant
2. Down payment on improvements
3. Capital Improvement Fund
4. Current Fund Appropriation
5. Emergency Fund Appropriation

Question 29

Capital Notes must be paid back within _______ at a rate of not less than ____ each year.

Answer 29

5 years

20%

Question 30

What is the debt limit for municipalities

Answer 30

3.5%

Question 31

What is the debt limit for counties?

Answer 31

2%

Question 32

What is the current year portion of a Capital Plan?

Answer 32

Capital Budget

Question 33

What is the maximum useful life of a capital project?

Answer 33

40 Years

Question 34

How many waiting days after the Estoppel Period?

Answer 34

20 days

Question 35

Who issues legal opinions when going to issue bonds?

Answer 35

Bond Council

Question 36

A local unit may finance any improvement which it has power to finance by obligations issued under the local bond law by the issuance of ______.

Answer 36

Capital Notes

Question 37

The aggregate amount of all Capital Notes outstanding at one time shall not exceed the lesser of $_____ or ____ of the equalized valuation basis.

Answer 37

$200,000

1/2 of one percent

Question 38

What is the calculation to find the First Legally Payable Installment amount for a note?

Answer 38

Maximum years of maturity of the bonds multiplied by 2, subtract 1 from this amount, then divide the principal amount of the notes by the result.

Example: Max Maturity of Bond 40 years, Principal amount of Notes is $790,000

40x2= 80
80-1= 79
790,000 divided by 79= $10,000 First Legally Payable Installment

Question 39

A capital budget is required when the sum of a line item capital project appropriations in the current budget exceeds ______ and/or a capital project ordinance is ____.

Answer 39

$25,000

Foreseen

Question 40

A Capital Plan is required whenever a capital budget is submitted. For municipalities under ____ population it must cover at least ___. For municipalities over _____ population, it must cover a period from _____.

Answer 40

10,000
3 years

10,000
4 to 6 years, including the current year

Question 41

Capital Projects must have a useful life of ____.

Answer 41

5 years or greater

Question 42

The aggregate amount of capital notes outstanding at any one time shall not exceed _____.

Answer 42

The lesser of $200,000 or 1/2 of 1% of the equalized valuation basis

Question 43

*When will a bond ordinance take effect?

Answer 43

20 days after its first publication after final adoption

Question 44

Bond Anticipation Notes must be paid no later than the ____ of the original notes

Answer 44

10th anniversary date

Question 45

Entities that issued debt after 7/3/1995 are required to give ______, by distributing financial data and disclosing all “material events” to bond markets.

Answer 45

Full disclosure