Técnica e Instrumento de Recolección de Datos

The following is a summary of capital asset and long-term debt activity for the University and its major blended component unit for fiscal year 2019. More detailed information can be found in Note 5 (Capital Assets), Note 11 (Bonds and Notes Payable) and Note 13 (Lease Obligations) of the Notes to the Financial Statements.

Unaudited

Capital Assets, Net of Depreciation

Amounts in thousands

The University

2019 2018

University Medical Associates

2019 2018

Land $ 6,349 $ 10,588 $ 26,097 $ 22,007

Construction in progress 1,639 3,484 634 241

Land improvements 4,323 5,087 — —

Buildings and improvements 353,001 376,481 63,274 63,973

Machinery and equipment 42,385 44,774 4,241 4,229

Vehicles 2,325 1,568 1,912 3,107

$ 410,022 $ 441,982 $ 96,157 $ 93,557

The University

Capital additions, net of the change in construction in progress and the sale of capital assets, totaled $10.7 million in fiscal year 2019 and consisted primarily of costs associated with renovations to administrative and laboratory space, and investments in medical, scientific and laboratory equipment.

The University had outstanding commitments under construction contracts related to these and other projects of approximately $33.2 million at June 30, 2019. These projects are being funded by bond proceeds, federal grants, state appropriations, restricted gifts, and unrestricted university funds.

University Medical Associates

UMA’s investment in capital assets, net of accumulated depreciation as of June 30, 2019 was $96.2 million. The change in capital assets year over year is primarily due to depreciation recorded during fiscal year 2019, offset by additions.

Bonds, Notes, Capital Lease Obligations, and Interfund Payables

The following table shows the amounts (in thousands) and types of bonds, notes, and capital leases outstanding as of June 30, 2019. The University

2019 2018

University Medical Associates

2019 2018

State institution bonds, net $ 41,781 $ 46,293 $ — $ —

Revenue bonds, net 23,994 25,642 — —

Notes payable 30,000 — — 2,212

Variable rate demand bonds — — 60,385 62,085

Fixed rate revenue bond — — 9,020 10,375

Capital lease obligations 57 82 297 687

Due to component unit 40,742 41,578 — —

Interfund payables 9,410 10,843 — —

$ 145,984 $ 124,438 $ 69,702 $ 75,359

The University

Following is a brief explanation of each type of long-term debt with examples of the assets acquired and the funding source the University expects to use to service the debt.

State Institution Bonds (SIB)

These bonds require the University to pledge revenue from student tuition for the repayment of this debt. If the University fails to repay this debt, the State would repay the debt because these bonds are backed by the State’s full faith, credit and taxing power. The proceeds from SIBs provided a portion of the funding for the Harper Student Center, the site for the Strom Thurmond Biomedical Research Facility, the Storm Eye Institute addition, the Children’s Research Institute, and a number of major renovation projects. The University’s SIBs are general obligation bonds of the State of South Carolina. Moody’s Investors Services rates them as “Aaa”. At June 30, 2019, the net SIB payable totaled $41.8 million.

Revenue Bonds

In fiscal year 2007, the University issued a $38 million revenue bond for the purpose of financing a new parking garage which opened in the fall of 2008. During fiscal year 2017, the University issued $25.1 million in Refunding Revenue Bonds to refund these bonds.

Unaudited

Notes Payable

On February 21, 2019, the Board of Trustees approved a resolution authorizing the University to use the South Carolina Master Lease Program for the purpose of financing the costs of purchasing and implementing energy conservation measures that will benefit the University with the understanding that the debt service payments will be generated from the associated energy savings. Pursuant to this resolution, the University borrowed $30,000,000 from TD Equipment Finance during fiscal year 2019.

Capital Leases

The University has an outstanding capital lease with CHS Development Company (CHS), a blended component unit, for the College of Health Professions complex and a parking garage. Monthly payments are made to a financial institution as trustee under this lease. At June 30, 2019, the capital lease liability payable to CHS was $9.4 million. The lease with this blended component unit is considered an Interfund Payable.

In fiscal year 2009, the University entered into capital leases with the Medical University of South Carolina Foundation (MUSCF), a discretely presented component unit, for a garage and two office buildings. As of June 30, 2019, the capital lease liability payable to MUSCF, which is reflected as Due to Component Unit, totaled $40.7 million.

In addition, the University has $0.1 million in capital leases payable at June 30, 2019 for various pieces of equipment. Sources Other Than Debt

The University also acquires some of its capital assets from other sources such as:

• ¨Federal grants. Grants were received from the federal government for some of the construction costs of the Hollings Cancer Center, the Drug Discovery and Biosciences Buildings, and the Bee Street Parking Garage. The University is not obligated to repay these monies.

• ¨State Capital Improvement Bonds. The State issues these bonds and makes the proceeds available for the University to spend on approved projects. The University used capital improvement bond proceeds to partially fund the construction of the new College of Dental Medicine Building. The University is not obligated to repay these funds to the State; therefore, the debt is not recorded on the University’s financial statements.

• ¨Research Infrastructure Bonds. The State issues these bonds and makes the proceeds available for the University to spend on approved projects. The University used research infrastructure bond proceeds to fund the construction of a new Drug Discovery Building and a Bioengineering Building. The University is not obligated to repay these funds to the State; therefore, the debt is not recorded in the University’s financial statements.

• ¨Private Gifts and Grants. Cash and other resources donated to the MUSC Foundation are periodically transferred to the University for capital projects.

University Medical Associates

At June 30, 2019, UMA had $69.7 million in outstanding bonds, notes and capital lease obligations compared to $75.4 million outstanding in the prior year, a decrease of 7.5 percent.

Requests for Information

These financial statements are designed to provide a general overview of The Medical University of South Carolina and its component units’ financial activities and to demonstrate the University’s accountability. Questions concerning any of the information provided in this report or requests for additional information should be addressed to the Controller’s Office, Medical University of South Carolina, 1 South Park, Suite 402, Charleston, South Carolina, 29407. These financial statements may also be obtained from our website:

STATEMENT OF NET POSITION