§ 4664. Asset reserves. An operator shall maintain reserve liabilities
and supporting assets in an amount for the purposes set forth in a
regulation issued by the commissioner. Liquid assets shall be maintained
for the following reserve liabilities:
1. Fifteen percent of the projected annual operating expenses of the
facility, exclusive of depreciation.
2. A provider shall notify the commissioner in writing at least ten
days prior to reducing the amount of funds available to satisfy the
applicable liquid reserve requirement. A provider shall not expend more
than one-half of the required balance each calendar year.
3. A provider may use funds in an endowment fund or escrow account,
including an escrow account established by or pursuant to a mortgage
loan, bond, indenture or other long-term financing, to satisfy the
reserve requirements of this section, if the funds are available to make
payments when operating funds are insufficient for these purposes.