Flora City financed the construction of sidewalks in a newly annexed subdivision by issuing $50 million in special assessment debt. The debt is to be serviced entirely by assessments against the subdivision's property owners. The government does not have any obligation for the debt and has not guaranteed it. Nevertheless, when the property owners in a nearby subdivision were unable to pay their required assessments, the city, fearful of damaging its own credit rating, serviced the debt using its own resources. Should the city report the $50 million in special assessment debt in its government-wide statement of net position? Explain, citing specific GASB provisions.

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The Answer of Flora City financed the construction of sidewalks in a newly annexed subdivision by issuing $50 million in special assessment debt. The debt is to be serviced entirely by assessments against the subdivision's property owners. The government does not have any obligation for the debt and has not guaranteed it. Nevertheless, when the property owners in a nearby subdivision were unable to pay their required assessments, the city, fearful of damaging its own credit rating, serviced the debt using its own resources. Should the city report the $50 million in special assessment debt in its government-wide statement of net position? Explain, citing specific GASB provisions.

Flora City Financed the Construction of Sidewalks in a Newly