Question: A large city has been financing all of its services
A large city has been financing all of its services through property taxes and sales taxes. As the cost of services has been increasing, the city has found it necessary to raise its tax rates. A special com-mission appointed by the mayor suggests that it would be possible to reduce the property tax rate by charging residents a monthly fee to cover the costs of collecting and disposing of trash and garbage. The mayor likes the suggestion and wants to run the sanitation activity like a commercial business. Describe the fund accounting implications of adopting that suggestion.
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