As given later in Chapter 8 of this project, the assessed valuation of property within the City of Smithville is $314,727,270. Assuming the legal general obligation debt limit is 8 percent of assessed valuation, prepare in good form a schedule showing the legal debt limit, debt outstanding subject to the limit, and the legal debt margin of the city as of December 31, 2017, rounding the debt limit to the nearest whole dollar (see Illustration 6-3 for an example). A note at the bottom of the schedule should disclose that $40,000 of restricted fund balance in the debt service fund is restricted for payment of interest rather than principal repayment and therefore should be excluded from your schedule. In addition, the note should disclose the bonds authorized but unissued, as described in the introductory paragraph of Chapter 5 of the City of Smithville cumulative problem. This will inform the reader that additional debt issuances are pending.

Additional Info:

Chapter 5 Intro Paragraph: During late 2016, the voters of the City of Smithville authorized tax-supported bond issues totaling $8,000,000 as partial financing for a series of projects to construct streets, curbs, culverts, and storm sewers in various parts of the city. The estimated total cost of the series of projects, which are expected to extend over the next three years, was $10,200,000. In addition to the bondfinancing, voters also approved a special cent sales tax to assist in financing the projects. The sales tax begins January 1,2017 and will continue for fiveyears. The sales tax is projected to generate $500,000 each year

Chapter 6 Intro Paragraph: The City of Smithville created a Street Improvement Bond Debt Service Fund to be used to retire the bonds issued for the purposes described in Chapter 5 of this cumulative problem, and to pay the interest on the bonds. The $2,000,000 face value of bonds issued during 2017 are dated January 1, 2017, but were not issued until May 6, 2017. Because bondholders will receive six months of interest on July 1, 2017 in the total amount of $40,000, they were required to pay $28,000on the date of issue to pay the city for unearned interest from January 1 to May 6. The bonds bear interest of 4 percent per annum. The first interest payment of $40,000 is due July 1, 2017. Subsequent semiannual interest payments will be made January 1 and July 1 of each following year until the maturity of the bonds. Bonds in the amount of $500,000are to mature five years after the date of the bonds (January 1, 2022), and $100,000 is to mature January 1 of each year thereafter until all the bonds issued in 2017 have been retired. Thus, these bonds are deferred serial bonds as discussed in Chapter 6 of the textbook.

Examples of Schedules:

CITY AND COUNTY OF DENVER, COLORADO Legal Debt Margin Information Last Ten Fiscal Years (in thousands) Calculation of Legal Debt Margin for Fiscal Year 2013 Total Estimated Actual Valuation Maximum general obligation debt, limited to 396 $79,581,379 2,387,441 of total valuation Outstanding bonds chargeable to limit Less amount reserved for long-term debt Net chargeable to bond limit Legal Debt Margin December 31 903,939 26,513 877 426 1,510,015 2005 2008 2009 2010 2012 2013 51,886,034 $1,975,265 $2,009,975 $2,304,393 $2,356,914 $2,485,329 $2,494,539 $2,314,276 $2,300,923 $2,387 441 Total net debt application to limit 355,492 380,984453,021 402,994567,928 649,694 976,103 902,541 862,872 877 426 Legal debt margin 1.530,542 $1.594,281 1,556,954 $1,901,399 $1.788,986 $1,835,635 $1518,436 $1,411.735 S1438,051 1,510,015 Total net debt applicable to the percentage of debt limit 18.85% 19.29% 22.54% 17.49% 24.10% 26.14% 39.13% 39.00% 37.50% 36.75% Notes Section 7.2 Charter of the City and Count , of Denver. The aty and Coney of Denver shall a become indebted for the actial value as delenmined by the last final assessment of the tuble propety within the City ind Conty or Denver Scurce: City ind Conaty of Denver, Colorado, Comprehensve Anual Financial Report, Statistical Section, 2013,page 163 eneral bli ation bond to an amount, which includa indebtedness shall exceed three pen at CITY AND COUNTY OF DENVER, COLORADO Legal Debt Margin Information Last Ten Fiscal Years (in thousands) Calculation of Legal Debt Margin for Fiscal Year 2013 Total Estimated Actual Valuation Maximum general obligation debt, limited to 396 $79,581,379 2,387,441 of total valuation Outstanding bonds chargeable to limit Less amount reserved for long-term debt Net chargeable to bond limit Legal Debt Margin December 31 903,939 26,513 877 426 1,510,015 2005 2008 2009 2010 2012 2013 51,886,034 $1,975,265 $2,009,975 $2,304,393 $2,356,914 $2,485,329 $2,494,539 $2,314,276 $2,300,923 $2,387 441 Total net debt application to limit 355,492 380,984453,021 402,994567,928 649,694 976,103 902,541 862,872 877 426 Legal debt margin 1.530,542 $1.594,281 1,556,954 $1,901,399 $1.788,986 $1,835,635 $1518,436 $1,411.735 S1438,051 1,510,015 Total net debt applicable to the percentage of debt limit 18.85% 19.29% 22.54% 17.49% 24.10% 26.14% 39.13% 39.00% 37.50% 36.75% Notes Section 7.2 Charter of the City and Count , of Denver. The aty and Coney of Denver shall a become indebted for the actial value as delenmined by the last final assessment of the tuble propety within the City ind Conty or Denver Scurce: City ind Conaty of Denver, Colorado, Comprehensve Anual Financial Report, Statistical Section, 2013,page 163 eneral bli ation bond to an amount, which includa indebtedness shall exceed three pen at