Title: Note 1 – Basis of presentation
Accounting Policies: Expenditures reported on the SEFA are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: LIIF has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
The accompanying Schedule of Expenditures of Federal Awards (SEFA) presents expenditures for the year ended June 30, 2023 related to all federal award programs of Low Income Investment Fund and Subsidiaries (LIIF). The information in the SEFA is presented in accordance with the requirements of Title 2 U.S. Code of Federal Regulations Part 200 (2 CFR 200), Uniform Administrative Requirements, Cost Principles, and Audit Requirements for Federal Awards (Uniform Guidance). Because the SEFA presents only a selected portion of the operations of LIIF, it is not intended to and does not present the financial position, changes in net assets, or cash flows of LIIF.
Title: Note 2 – Summary of significant accounting policies
Accounting Policies: Expenditures reported on the SEFA are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: LIIF has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
Expenditures reported on the SEFA are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
Title: Note 3 – Indirect Rate Calculation
Accounting Policies: Expenditures reported on the SEFA are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: LIIF has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
LIIF has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
Title: Note 4 – Charter school facilities financing demonstration program and credit enhancement for charter schools facilities grant program
Accounting Policies: Expenditures reported on the SEFA are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: LIIF has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
During 2002, LIIF received an award from the U.S. Department of Education in the amount of $3,000,000 (S354A020003) to be used for providing facilities financing for charter schools in the state of California. During 2008, LIIF received an additional award totaling $5,000,000 (U354A070009). During 2019, LIIF received additional awards totaling $2,000,000 (U354A160003) and $8,000,000 (U354A170003). In accordance with the award agreement, these amounts are to be used to provide credit enhancements (fund loss reserves and/or cover potential losses) for charter schools. As required by federal regulations, the $18,000,000 of funds received under this award were deposited into a reserve fund account and are invested in obligations issued or guaranteed by the United States. In accordance with the grant agreement, total investment earnings in the amount of $1,597,629 have been reinvested in a reserve account and are to be used in accordance with the provisions of the grant agreement. In accordance with policy guidance issued by the U.S. Department of Education related to this federal program, the total amount of federal awards expended includes the total amount of the reserve fund at the beginning of the grantee’s fiscal year and any funds drawn down during the fiscal year to add to the reserve fund. Accordingly, the total amount included in the SEFA is the balance of the reserve fund, including investment earnings. As of June 30, 2023, LIIF used $1,233,000 to cover losses of the program.
Title: Note 5 – Community Development Financial Institution bond guarantee program
Accounting Policies: Expenditures reported on the SEFA are reported on the accrual basis of accounting. Such expenditures are recognized following the cost principles contained in the Uniform Guidance, wherein certain types of expenditures are not allowable or are limited as to reimbursement.
De Minimis Rate Used: N
Rate Explanation: LIIF has not elected to use the 10% de minimis indirect cost rate as allowed under the Uniform Guidance.
In September 2014 and July 2016, LIIF entered into financing arrangements of $65,000,000 and $50,000,000, respectively, with the Community Development Financial Institution (CDFI) Bond Guarantee Program through CRF QI, LLC, a Qualified Issuer. Under this program, the Secretary of the Treasury provides a guarantee for the repayment of the full amount issued to the eligible CDFIs for eligible community or economic development purposes for a period not to exceed 30 years. LIIF has drawn down the entire $115,000,000 of amortizing debt from these facilities with terms varying between 20 and 28 years under the agreement in order to refinance eligible projects. LIIF has no available credit under these agreements. The total amount included in the SEFA is the prior-year bonds outstanding plus the current-year drawdowns. The bond amounts outstanding for the September 2014 and July 2016 financing arrangements were $51,328,588 and $43,297,822, respectively. The total bond amount outstanding at June 30, 2023 is $94,626,410.