To allow for more accurate planning of upcoming cash needs, the authority should refine its cash-projection process to more accurately reflect its near-term cash needs. Specifically, the authority should refrain from requesting additional bond sales for projects that have not yet received project approval from the authority.
The Authority no longer requests bond funds for projects not yet approved by the Authority. Commercial paper is generally issued monthly, allowing quick turnaround once disbursement requests are received on grants that have been approved, so delays in disbursements are unlikely.
The Authority has not received bond funds since December 2010.
Based on a review of the historical data of the program's grant disbursements, CHFFA's financial advisor concluded that because bond funding requests are made at six-month intervals and many disbursements are made within six months of grant approval, bond funding requests need to include anticipated applications in addition to approved grants. However, the Authority agrees that it should refrain from requesting additional bond funds for projects that have not yet received project approval from the Authority unless the Authority has documentation from the hospital showing the likelihood of project approval and disbursement within the six month window used to provide estimates to the Department of Finance.
As part of the analysis described in Recommendation 2, the authority indicates its financial advisor will provide guidance in forecasting grant disbursement needs. It further indicates it will not request bond funds for projects that have not yet received project approval from the authority. (See 2013-406, p. 90)
Agency responses received after June 2013 are posted verbatim.