To avoid contributing to the State's financial strain, the authority should limit future bond sales to the level of disbursements it reasonably expects to make during the following six-month period.
Commercial paper (CP) is now issued instead of upfront general obligation (GO) bond funds. This process allows CHFFA to limit CP sales to the level it reasonably expects to make in two months, exceeding the auditor's recommendation.
Bond funds are later issued to cover actual costs.
The first CP ($10.5 million) was issued at the end of June, 2013.
Since the Authority's 60 day response, the Authority has not requested any additional bond funds and has continued efforts to reduce its existing cash balance by continuing to make disbursements from its existing cash balance. The Authority agrees to limit future bond sales to the level of disbursements it reasonably expects to make during the following six-month period following the sale, or as otherwise directed by the Department of Finance in its twice-yearly cash needs survey.
The California Health Facilities Financing Authority has not provided documentation to support its assessment. As such, we cannot yet assess the authority's implementation of this recommendation.
The authority indicates it has not requested additional bond funds. (See 2013-406, p. 89)
†Response Type refers to the interval in which the auditee is providing the State Auditor with their status in implementing recommendations made in an audit report. Auditees must submit a response regarding their progress in implementing recommendations from our reports at three intervals from the release of the report: 60 days, six months, and one year or subsequent to one year.
*Agency responses received after June 2013 are posted verbatim.