Bill > AB627

This bill modifies the California Health Facilities Financing Authority Act by changing several key provisions related to working capital loans for health institutions. Specifically, the bill removes the previous 2-year cap on interest for working capital loans, eliminating the requirement that private nonprofit health institutions must repay such loans within 24 months. The bill establishes new financial eligibility standards for working capital loans, requiring the authority to assess the creditworthiness of participating health institutions by examining factors like pledged revenues, debt service coverage, and basic security. Importantly, the bill prohibits health institutions determined to be in financial distress from being considered financially eligible for loans. The legislative intent is to provide creditworthy nonprofit health institutions with more flexible and cost-effective financing tools. By expanding the purposes for which the California Health Facilities Financing Authority Fund can be used, the bill effectively makes an appropriation from that fund, allowing health institutions greater financial flexibility in managing their operational expenses and capital needs.

Budget and Finance, Health and Social Services

https://leginfo.legislature.ca.gov/faces/billStatusClient.xhtml?bill_id=202520260AB627