Standard and Poor’s Gives Highest Rating to $10B Borrowing Effort
On Wednesday, Standard & Poor's issued its highest rating to $10 billion in short-term notes that California plans to issue this month to secure enough funding through June 2013, the Sacramento Bee's "Capitol Alert" reports.
The state plans to start selling the notes to investors on Aug. 14.
California borrows money during the first half of each fiscal year because the majority of its revenue comes during the second half. The state borrows from investors and relies on internal special fund accounts to help pay for state services, including health care, prisons and schools.
Details of S&P Rating
S&P assessed the state's fiscal situation and determined that it should have more than enough money to pay back the $10 billion next spring.
It issued a rating of SP-1+ to the notes.
IHSS Funding in Question
The S&P report showed that the state Department of Finance is notÂ relying onÂ $200 million in new federal funds for the In-Home Supportive Services program, despite accounting for the funds in the fiscal year 2012-2013 budget.
H.D. Palmer, spokesperson for the Finance Department, said that state officials are confident that California ultimately will receive the money. However, he said that it is unclear whether the federal government will approve the IHSS funding before June 2013 (Yamamura, "Capitol Alert," Sacramento Bee, 8/1).This is part of the California Healthline Daily Edition, a summary of health policy coverage from major news organizations. Sign up for an email subscription.