Connecticut Health&Educational Facilities Authority's (CHEFA) revenue bonds issued for nursing home program (New Horizons Village project) series 1994 includes several layers of security for bond repayment including payments from the individual nursing home, a mortgage on the real property, buildings, and equipment of the nursing home; and finally an intercept of Medicaid revenues due the institution from the state. The ultimate security however is the establishment of the special capital reserve fund (SCARF). The reserve (required to equal maximum annual debt service) is funded up front with bond proceeds and can be utilized to pay debt service in the event of a payment deficiency on the part of the nursing home. If there is a deficiency in the
