The rating on New Jersey Health Care Facilities Finance Authority's bonds, issued for Capital Health System (CHS), reflects: Significant operating losses in each of the past three fiscal years; Poor prior management policies and procedures that failed to recognize or staunch operational problems; The erosion of CHS' days' cash position; and Declines in expected debt service coverage levels. Despite this deterioration, an ongoing $18 million cost cutting plan and CHS' balance sheet position, which is still fairly strong for a New Jersey provider, preclude a lower rating at this time. In addition to the cost cutting plan, results in 2000 should be enhanced by onetime disproportionate share settlements dating back to 1992 for both CHS campuses. The disproportionate share settlements
