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City of Centerville <br />March 28, 2012 <br />Page 15 <br />Debt -to- Assets Leverage Ratio (Solvency Ratio) <br />The debt -to -assets leverage ratio is a comparison of a city's total liabilities to its total assets or the percentage of total assets that are <br />provided by creditors. It indicates the degree to which the City's assets are financed through borrowings and other long -term <br />obligations (i.e. a ratio of 50 percent would indicate half of the assets are financed with outstanding debt). <br />Bonded Debt per Capita (Funding Ratio) <br />This dollar amount is arrived at by dividing the total bonded debt by the population of the city and represents the amount of bonded <br />debt obligation for each citizen of the city at the end of the year. The higher the amount, the more resources are needed in the future to <br />retire these obligations through taxes, assessments or user fees. <br />Taxes per Capita (Funding Ratio) <br />This dollar amount is arrived at by dividing the total tax revenues by the population of the city and represents the amount of taxes for <br />each citizen of the city for the year. The higher this amount is, the more reliant the city is on taxes to fund its operations. <br />Current Expenditures per Capita (Funding Ratio) <br />This dollar amount is arrived at by dividing the total current governmental expenditures by the population of the City and represents <br />the amount of governmental expenditure for each citizen of the City during the year. Since this is generally based on ongoing <br />expenditures, we would expect consistent annual per capita results. <br />Capital Expenditures per Capita (Funding Ratio) <br />This dollar amount is arrived at by dividing the total governmental capital outlay expenditures by the population of the City and <br />represents the amount of capital expenditure for each citizen of the City during the year. Since projects are not always recurring, the <br />per capita amount will fluctuate from year to year. <br />Capital Assets Percentage (Common -size Ratio) <br />This percentage represents the percent of governmental or business -type capital assets that are left to be depreciated. The lower this <br />percentage, the older the city's capital assets are and may need major repairs or replacements in the near future. A higher percentage <br />may indicate newer assets being constructed or purchased and may coincide with higher debt ratios or bonded debt per capita. <br />952.835.9090 • Fax 952.835.3261 <br />w w w.aemcpas. corn <br />