Note 4: Long-Term Debt

  As of June 30, (in thousands)
Description Interest Rate Maturity 1996 1995
Plant Funds
Revenue Bonds Medical Center Series A
3.75% to 5.2% 1997-2015 $ 46,600 $ 49,205
Medical Center Series C 8.1% 1997 -- 425
Medical Center Series E 6.0% to 7.0% 2001-2013 55,875 55,875
University of Virginia Series A variable 2020 6,100 6,100
University of Virginia Series B 4.0% to 5.375% 1997-2020 59,035 60,650
Clinch Valley College Series B 5.6% to 5.875% 1997-2011 340 350
Commonwealth of Virginia Bonds 3.5 to 9.25% 1997-2013 69,299 58,102
Higher Education Equipment Trust Fund Leases Payable 3.7% to 5.35% 1996-2001 15,435 12,603
Other various 1996-1999 1,076 1,752
Total    $253,760 $245,062

On January 31, 1996, the Commonwealth of Virginia, on behalf of the University of Virginia, issued $896,000 of Series 1996 Refunding Bonds with interest rates ranging from 4.75% to 5.13% to refund $840,000 of outstanding 1990 Series B and 1991 Series A with interest rates ranging from 6.3% to 6.5%. Though the refunding resulted in the recognition of an accounting loss of $56,000 for the year ended June 30, 1996, the University in effect reduced the aggregate debt service obligation by $30,000 over the next seven years and obtained an economic gain (difference between the present values of the old and new debt service) of $30,000.

Long-term debt matures for each of the next five years and in the aggregate (in thousands):

1996 - 1997 $ 13,154
1997 - 1998 13,409
1998 - 1999 13,037
1999 - 2000 12,307
2000 - 2001 12,842
Later years 189,011
Total $253,760

Note 5: Affiliated Companies

The Medical Center is a participant with the Health Services Foundation in a joint venture to develop and operate a managed health care organization in central and western Virginia and certain counties in West Virginia. Blue Ridge Health Alliance, Inc. (BRHA), a for-profit corporation, was formed on April 11, 1994, to develop a regional network of physicians, hospitals, and other health care providers through which to deliver health benefits to insured and self-funded employers and other groups. As of June 30, 1996, the Medical Center has purchased one share of common stock for $1,000 and made equity contributions of $7,049,000, of which $3,858,000 was made during the year ended June 30, 1996. The net investment in BRHA, after including operating losses of $1,528,000 for the year ended June 30, 1996, is $4,271,000.

In May, 1995, the Medical Center joined the Central Virginia Health Network, Inc., a partnership of eight Richmond-area hospitals, formed to provide an efficient and coordinated continuum of care. As of June 30, 1996, the Medical Center has paid $100 for 10,000 shares of common stock and $110,000 as additional paid-in-capital. The net investment in Central Virginia Health Network, Inc., after including operating gains of $68,000 for the year ended June 30, 1996, is $91,000.

In May, 1996, the Medical Center entered into a joint ven- ture (University of Virginia/HEALTHSOUTHL.L.C.) with HEALTHSOUTH Corporation to establish an acute rehabilitation facility and made a capital contribution of $2,000,000 which represents a fifty percent interest in the joint venture.

In May, 1995, HealthCare Partners, Inc., a non-stock, non-profit corporation was established to employ primary care physicians from the wider community served by the Medical Center and to integrate these physicians into the teaching faculty of the University of Virginia Medical School. The Medical Center and University of Virginia Health Services Foundation are contributing to the funding of the corporation. During 1996, the Medical Center made a $3,000,000 contribution. The Board of Visitors has authorized an additional contribution of $5,000,000 to HealthCare Partners, Inc.

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