DIRECT SUPPORT ORGANIZATIONS · The private/public partnerships and client relationships unique to CAMLS is laying the foundation to replace outdated healthcare methodologies. Partnering

DIRECT SUPPORT ORGANIZATIONS

ANNUAL FINANCIAL PLANS

FISCAL YEAR 2017

May 19, 2016

DSO Annual Financial Plans for FY 2017 INDEX USF Health Professions Conferencing Corporation .................................................. 2-4

University Medical Services Association, Inc. .......................................................... 5-8

Medical Services Support Corporation, Inc. .............................................................. 9-11

USF Foundation, Inc. ................................................................................................. 12-15

Sun Dome Inc. ............................................................................................................ 16-18

USF Alumni Association, Inc. ................................................................................... 19-22

USF Research Foundation, Inc. .................................................................................. 23-26

USF Financing Corporation and USF Property Corporation ..................................... 27-29

[ 1 ]

State the DSO's Statutory Mission which Supports the Goals of the University

USF Health Professions Conferencing Corporation (HPCC) trains students and healthcare professionals in the development and maintenance of professional excellence through the ethical, innovative and efficient dissemination of knowledge and enhancement of skills required for clinical practice, research and education.

List Key Drivers for the 2017 Financial Plan Over 2016 - Focus on Cash Flows and Adequacy of Reserves

Course offerings unique to CAMLS and developed at CAMLS will drive growth in regional hospital, healthcare and international healthcare provider competency based trainings.

The private/public partnerships and client relationships unique to CAMLS is laying the foundation to replace outdated healthcare methodologies. Partnering with regional hospitals to develop proven trainings and better methodologies creates a competitive advantage regionally which can then be delivered nationally and internationally.

International relationships are being actively developed and contracted in Panama, Mexico and the US Virgin Islands for hands on training at CAMLS, simulation center consultation and train the trainer events.

The CAMLS Innovation Center will focus on a 12 Unit (4 course) Graduate Certificate program for Agile Software Development in Healthcare. The curriculum is planned to be developed and delivered in cooperation with CAMLS, occammd, and USF Health IT.

Continued strong industry representation at CAMLS and increasing USF Health utilization of CAMLS will optimize all programming and space opportunities at the downtown Tampa facility.

Equipment capital expenditures will be limited to equipment required for existing courses.

Identify Key Risks That Might Affect the 2017 Financial Plan

Although HPCC has a diverse customer base, changing regulatory standards, economic conditions, public perception, corporate strategies and research opportunities could have a positive and or negative effects on the FY17 Plan.

Fully utilizing CAMLS during non-peak hours, such as evenings, spreads fixed costs among more customers and increases operating earnings.

Expand the CAMLS developed curriculum along with the regional and international customers seeking the CAMLS training certificate.

Equipment that is paid in full and depreciated in full but continues to have a significant productive life decreases cash outflows for debt service and new equipment purchases.

USF HEALTH PROFESSIONS CONFERENCING CORPORATIONAnnual Financial Plan for FY 2017

FINANCIAL PLAN STATEMENT

Describe Material Capital Expenditures in the 2017 Financial Plan - Provide Details and ROI Expectations

List Major DSO Initiatives that will Drive Operating Earnings for 2018 and 2019

[ 2 ]

(In thousands) FY 2017 FY 2016 FY 2016 FY 2015FINANCIAL FORECAST FINANCIAL ACTUAL

PLAN (as of 3/31/16) $ % PLAN RESULTS

REVENUES Continuing Professional Development $3,500 $4,000 $(500) (13)% $6,600 $7,577CAMLS - USF Health Programming 4,500 6,500 (2,000) (31)% 3,918 7,211CAMLS - Industry, Societies, Healthcare 7,500 7,000 500 7 % 10,750 6,755Other HPCC Divisions 1,000 1,600 (600) (38)% 1,790 1,924

In Kind Donations 0 0 0 % 500 773Rents, Parking, Rebates, Interest 300 300 0 0 % 300 471Total Revenues $16,800 $19,400 $(2,600) (13)% $23,858 $24,711

EXPENSESWages and Benefits $3,310 $4,600 $(1,290) (28)% $5,086 $4,705Utilities, Leases, Maint., Supplies, Marketing 4,000 4,000 0 0 % 4,053 3,668Direct Program Expense 6,750 7,500 (750) (10)% 10,678 12,872Interest 740 790 (50) (6)% 790 831In Kind Expense 0 0 0 % 500 773Depreciation-Purchased & Donated Assets 2,000 2,400 (400) (17)% 2,400 2,796Total Expenses $16,800 $19,290 $(2,490) (13)% $23,507 $25,645

OPERATING PROFIT BEFORE NON-CASH CHANGES $0 $110 $(110) (100)% $351 $(934)

Unrealized Investment Gains (Losses) 0 0 0 % 0 0Change in Fair Value of Swaps 0 0 0 % 0 0[Enter other non-cash item here] 0 0 0 % 0 0Total Non-Cash Changes $0 $0 $0 % $0 $0

NET OPERATING PROFIT $0 $110 $(110) (100)% $351 $(934)


INCOME STATEMENT

Variance

[ 3 ]



OPERATING ACTIVITIES Net Operating Profit $0 $110 $(110) (100)% $351 $(934)Adjustments for Non-Cash Activities:

Depreciation 2,000 2,400 (400) (17)% 2,400 2,796Adjustments for Changes in

Operating Assets and Liabilities 0 (1,000) 1,000 100 % 0 1,880Total Cash From Operating Activities $2,000 $1,510 $490 32 % $2,751 $3,742

INVESTING ACTIVITIES Net (Purchases) Sales of Investments $0 $0 $0 % $0 $0Capital Expenditures 0 (100) 100 100 % (500) (148)Total Cash From Investing Activities $0 $(100) $100 100 % $(500) $(148)

FINANCING ACTIVITIES Repayment of Long-Term Debt $0 $0 $0 % $0 $(1,500)Principal Payments (1,400) (2,200) 800 36 % (2,200) (2,094)Interest Payments 0 0 0 % 0 0Total Cash From Financing Activities $(1,400) $(2,200) $800 36 % $(2,200) $(3,594)

CHANGE IN CASH 600 (790) 1,390 176 % 51 0

Cash, Beginning of Year 289 1,079 (790) (73)% 1,079 1,079Cash, End of Year $889 $289 $600 0 % $1,130 $1,079


STATEMENT OF CASH FLOWS

Variance

[ 4 ]


University Medical Services Association is a not-for-profit entity organized to operate exclusively for scientific and educational purposes for the support of the objectives of USF's College of Medicine in accordance with the College Faculty Practice Plan. It's ongoing goal is programmatic development of business lines that support the education of medical students and residents, promote research in the clinical environment, and provide focused healthcare to the community.


Recapture EPIC implementation losses in revenue for August and September, 2016.

Faculty Productivity/Patient Access - Improving arrival rates and increasing physician clinical effort will result in an increase of 5% in outpatient encounters and $1.9M increase in margin.

Reorganization of ancillary services including ASC and USFPG Lab - Projecting to break even for FY17, adding $3.6M in margin in FY17.

Expense Reductions in professional consulting will result in savings of $1.4M for FY17.

Realignment of pay distributions for academic funding will result in $1.3M expense reduction in FY17.

Improvement to managed care contract rates will result in $2.1M increase in patient service revenue.

Expense Reductions in IT related to EMR will result in savings of $838k for FY17.

TGH support for program growth will be critical for the financial success of UMSA.

Effective 7/1/16 MSSC will become the strategic investment organization for the Dean's Office. UMSA is assuming the legal obligations of MSSC to make debt service payments on the Series 2013A and Series 2013B Bonds (via the 3 Facility Leases) – totaling $60.7 million, with annual debt service payments of $4M in FY2017. UMSA will also be acquiring the assets associated with these lease obligations. UMSA is already the funding source for these obligations and no financial impact is anticipated.

N/A


80% reduction in UPL program at 6/30/2016, will result in loss of $4.9M in annual revenues. We may recapture this, however this is currently in the hands of AHCA, CMS and managed Medicaid plans.


University Medical Service Association, Inc.Annual Financial Plan for FY 2017


[ 5 ]

Conversion to EPIC medical record went live 8/1/2015. Initial cost was approximately $7M in capital, training and staffing. Long-Term, EPIC will reduce operating costs. In addition, the EPIC conversion will result in significant increases in revenue through better patient scheduling, coding and charge capture.

Redesigning physician work effort expectations and associated compensation. Achieving optimal patient access and satisfaction. Reorganization of ASC & USFPG Lab, along with renegotiation of managed care contracts will increase earnings in future years. Becoming a value driven organization. Reorganization of ASC & USFPG Lab, along with renegotiation of managed care contracts will increase earnings in future years. Redesigning the funds flow model to minimize overreliance on clinical revenues to support academic endeavors.


[ 6 ]

(In thousands) FY 2019 FY 2018 FY 2017 FY 2016 FY 2016 FY 2015FINANCIAL FINANCIAL FINANCIAL FORECAST FINANCIAL ACTUAL

PLAN PLAN PLAN (as of 3/31/16) $ % PLAN RESULTS

REVENUES Net Patient Service $198,448 $183,521 $165,558 $148,559 $16,999 11 % $155,306 $141,424Grants, Contracts & Awards 65,500 65,000 64,761 61,243 3,518 6 % 57,711 53,399UPL/PCIP 0 0 1,253 6,873 (5,620) (82)% 6,583 7,504Meaningful Use 0 0 587 587 0 0 % 0 1,016Other Revenues 32,623 31,672 30,750 30,248 502 2 % 28,694 29,248Total Revenues $296,571 $280,194 $262,909 $247,510 $15,399 6 % $248,293 $232,591

EXPENSESFaculty Support $148,324 $138,620 $130,160 $123,131 $7,029 6 % $121,021 $110,544Housestaff Support 11,711 11,370 11,038 11,038 (0) (0)% 11,689 10,695Other Staff Support 81,816 79,049 76,376 75,101 1,275 2 % 76,345 64,051Other Expenses (Adjusted for MSSC) 47,838 46,220 44,657 45,530 (873) (2)% 45,620 45,809Depreciation/Amortization (MSSC Added for FY17) 5,054 4,907 4,764 1,662 3,101 187 % 1,864 1,390Total Expenses $294,742 $280,166 $266,995 $256,463 $10,532 4 % $256,539 $232,489

OPERATING PROFIT BEFORE NON-OPERATING CHANGES $1,829 $28 $(4,086) $(8,953) $4,867 54 % $(8,245) $102

Unrealized Investment Gains (Losses) 0 0 0 (886) 886 100 % 0 (325)Non Cash Impact of Epic 0 0 0 0 0 % 0 4,672Gain/Loss on Transfer of Assets 0 0 0 (5,136) 5,136 100 % 0 0Total Non-Operating Changes $0 $0 $0 $(6,022) $6,022 100 % $0 $4,347

NET PROFIT $1,829 $28 $(4,086) $(14,975) $10,888 73 % $(8,245) $4,449

Original/Projected Financial Plan Submitted $4,595 $475 $(8,245) $(4,003)

Variance

University Medical Service Association, Inc.

Annual Financial Plan for FY 2017

INCOME STATEMENT

[ 7 ]

(In thousands) FY 2019 FY 2018 FY 2017 FY 2016 FY 2016 FY 2015FINANCIAL FINANCIAL FINANCIAL FORECAST FINANCIAL ACTUAL

PLAN PLAN PLAN (as of 3/31/16) $ % PLAN RESULTS

OPERATING ACTIVITIES Net Operating Profit $1,829 $28 $(4,086) $(14,975) $10,888 73 % $(8,245) $4,449

Adjustments for Non-Cash Activities:Depreciation / Amortization 5,054 4,907 4,764 1,662 3,101 187 % 1,864 1,016Unrealized Gains 0 0 0 886 (886) (100)% (265) 325Adjustments for Changes in

Operating Assets and Liabilities 3,450 3,400 3,370 (734) 4,104 559 % 3,261 (6,754)Total Cash From Operating Activities $10,333 $8,335 $4,048 $(13,161) $17,208 131 % $(3,385) $(963)

INVESTING ACTIVITIES Capital Expenditures $(2,000) $(2,000) $(4,000) $(2,500) $(1,500) (60)% $(2,000) $(2,537)Purchases (Sales) of Investments 0 0 0 8,800 (8,800) (100)% 10,000 2,552Total Cash From Investing Activities $(2,000) $(2,000) $(4,000) $6,300 $(10,300) (163)% $8,000 $1,390

FINANCING ACTIVITIES Proceeds of Long-Term Debt $0 $0 $0 $0 $0 % $0 $0Principal Payments (1,950) (1,900) (1,870) 0 (1,870) % 0 0Total Cash From Financing Activities $(1,950) $(1,900) $(1,870) $0 $(1,870) % $0 $0

CHANGE IN CASH 6,383 4,435 (1,822) (6,861) 5,038 73 % 4,615 427

Operating Cash, Beginning of Year 6,794 2,359 4,182 11,042 10,615 10,615

Operating Cash End of Year 13,177 6,794 2,359 4,182 (1,822) (44)% 15,230 11,042Invested Cash 27,250 27,250 27,250 27,250 27,055 36,753Cash, End of Year $40,427 $34,044 $29,609 $31,432 $(1,822) 0 % $42,285 $47,795

Original Financial Plan $40,427 $34,044 $29,609 $41,448 $41,448 $48,862

Days Cash on Hand 50.9 45.1 41.2 45.0 60.6 75.5

Variance

University Medical Service Association, Inc.Annual Financial Plan for FY 2017


[ 8 ]


Medical Services Support Corporation is a not-for-profit entity organized to operate exclusively for scientific and educational purposes or the support of the objectives of USF's College of Medicine in accordance with the College Faculty Practice Plan.


Effective 7/1/16 MSSC will become the strategic investment organization for the Dean's Office. Funding sources include Dean's academic support and GME funding.

Historically, the Dean's fund has provided a $1.5M margin; however due to the support required by HPCC we anticipate a break even FY2017.

N/A


UPL reductions will impact the Dean's fund which means departments may want support from another source.

HPCC

Recruitment and growth

N/A



USF Medical Support Services Corporation



[ 9 ]



REVENUES Operating Revenues (UPL/PSR/Deans Tax FY17) 8,845 31,412 (22,567) (72)% 62,335 61,717Other Revenues 12,306 1,551 10,755 693 % 3,500 4,141Total Revenues $21,151 $32,962 $(11,811) (36)% $65,835 $65,857

EXPENSESFaculty support $5,491 $110 $5,380 4,874 % $150 $169Housestaff support 9,007 29 8,978 30,644 % 50 48Staff support 2,960 17,701 (14,741) (83)% 39,251 40,883Medical Materials/Supplies 0 6,025 11,049 11,819Interest Paid on Debt 0 1,848 2,500 2,579Other Expenses 3,941 5,488 (1,547) (28)% 9,000 8,765Depreciation/Amortization 0 2,360 (2,360) (100)% 3,200 3,080Total Expenses $21,398 $33,561 $(12,164) (36)% $65,200 $67,343

OPERATING PROFIT BEFORE NON-OPERATING CHANGES $(246) $(599) $352 59 % $635 $(1,486)

Unrealized Gains/Losses 0 0 0 % 0 0Gain/(Loss) on Sale/Transfer of Assets 0 5,135 (5,135) (100)% 0 0Change in Fair Value of Swaps 0 0 0 % 0 2,760Total Non-Operating Changes $0 $5,135 $(5,135) (100)% $0 $2,760

NET PROFIT $(246) $4,536 $(4,783) (105)% $635 $1,273

Variance

USF Medical Support Services Corporation


INCOME STATEMENT

[ 10 ]



OPERATING ACTIVITIES Net Operating Profit $(246) $4,536 $(4,783) (105)% $635 $1,273

Adjustments for Non-Cash Activities:Depreciation / Amortization 0 2,360 (2,360) (100)% 3,200 3,080Unrealized Gains 0 0 0 % 0 0Adjustments for Changes in

Operating Assets and Liabilities 0 (926) 926 100 % 0 (780)Total Cash From Operating Activities $(246) $5,971 $(6,217) (104)% $3,835 $3,573

INVESTING ACTIVITIES Capital Expenditures $0 $(936) $936 100 % $(1,500) $(574)Purchases (Sales) of Investments 0 0 0 % 0 0Total Cash From Investing Activities $0 $(936) $936 100 % $(1,500) $(574)

FINANCING ACTIVITIES Proceeds of Long-Term Debt $0 $0 $0 % $0 $0Principal Payments 0 (1,845) 1,845 100 % (2,000) (1,930)Total Cash From Financing Activities $0 $(1,845) $1,845 100 % $(2,000) $(1,930)

CHANGE IN CASH (246) 3,190 (3,437) (108)% 335 1,069

Operating Cash, Beginning of Year 5,135 1,945 2,326 875

Operating Cash End of Year 4,889 5,135 (246) (5)% 2,661 1,945Invested Cash 0 0 0 0Cash, End of Year $4,889 $5,135 $(246) 0 % $2,661 $1,945

Variance

USF Medical Support Services CorporationAnnual Financial Plan for FY 2017


[ 11 ]


The University of South Florida Foundation aids and promotes excellence in the educational, research and service activities of USF by seeking, receiving and administering private gifts for the benefit of the University. We enhance resources that support the strategic objectives of the University of South Florida System within a culture of cooperation and collaboration.

List Key Drivers for Improvements in the 2017 Financial Plan Over 2016 - Focus on Cash Flows and Reserves

The Foundation completed the first phase of a comprehensive campaign to raise funds for USF to attract world-class scholars and students, build state-of-the-art academic and athletic facilities, and support groundbreaking research activities exceeding the $600 million goal with over $621 million raised. The Foundation has entered into a second phase of this Campaign with a goal to bring the overall Campaign total to $1 billion. This phase of the Campaign will continue to focus on our students and faculty by strengthening the academic environment, supporting research, and making the dream of a college education more affordable. The Foundation has raised $913 million through the 3rd quarter of fiscal year 2016.

The Foundation's Investment Committee continues to actively monitor the performance and liquidity of our asset allocation and investment managers and take action when appropriate to enhance the growth and benefit of the endowment to USF over a long-term horizon. Our short-term and long-term returns are consistently in the top quartile amongst our peers. Our goal is to grow the endowment through continued solid investment returns and gifts.

The Foundation supports program activities of the University for USF faculty & staff, student scholarships, research initiatives, and capital projects according to donor restrictions. These expenses can be funded by current gifts estimated on the annual plan, existing balances in accounts from gifts and distributions received in prior years, or projected endowment distributions during the year of about $16 million. With the assistance of the Foundation, spending from these sources is directed by the colleges and units designated by our donors as the beneficiaries of their gifts.

The Foundation receives contributions to support capital improvements on behalf of the USF System. As these capital projects commence, funds are transferred to USF Facilities Planning for expenditure.


The budget reductions experienced by the USF System have led to fluctuations in the utilization of Foundation funds. While Foundation sources of support like the endowment provide a small percentage of the System's overall budget, this source is critical for many University programs while providing a funding catalyst for others to achieve the University's goals and aspirations.

The Investment Committee prudently considers the risks associated with each asset class in addition to the return when conducting its annual review of the endowment asset allocation. The goal of this process is to minimize the volatility of the investment performance and provide a more consistent, reliable stream of income to the University.

University support of the Foundation's operating budget is essential to continue the high level of fundraising demonstrated during the Unstoppable Campaign. Good financial stewardship of this support and other available resources is important to the Foundation's success. The Foundation's cost to raise a dollar remained low at 15 cents per dollar during the length of the Unstoppable Campaign. In other words, for every dollar invested in fundraising during the Campaign, the Foundation has raised over six dollars in return.

State funding from the suspended Major Gifts matching program continues to remain unfunded by the legislature with more than $20 million in match funds to enhance the endowment once received.

USF Foundation, Inc.




[ 12 ]

The Foundation will continue to support the University's goal surrounding its Student Success initiative with fundraising for scholarships and fellowships. During the 2nd phase of the Campaign, the Foundation has secured several transformational gifts to the university including naming of the Muma College of Business, the Kate Tiedemann College of Business at USF St Pete, the Lynn Pippenger School of Accountancy, the Zimmerman School of Advertising and Mass Communications, Collier Student Success Center in the Muma College of Business and Pippenger Hall in the USF St Pete Kate Tiedemann College of Business. These gifts will attract faculty and students globally and provide for greater learning and career opportunities for students.

Research and Innovation is continually supported through the Foundation's efforts in securing philanthropic, private research grants. During the Unstoppable Campaign approximately $45.1 million in philanthropic grants were received to support research efforts in areas such as Health, Engineering and Education. In addition, Endowed Chair and Professorship funds provide a predictable, steady stream of earnings to support the Chair or Professors' research efforts in perpetuity.

Cultivating university partnerships, both public and private, is a goal of the Foundation. The generosity of our donors ensures an environment rich in research, teaching, learning and discovery. Our partnership with the Tampa Bay Lightning has made the Sports and Entertainment Management Program possible. This program benefits graduate students who will become the future leaders of the sports management field. The Lightning have provided financial support, but also provide access to their executives for real-world learning, classroom space at their facility and paid internships for many of the students.

The Foundation enhances the economic base for USF through the annual support generated from the Foundation's endowment. The endowment provides over $16 million each year to support USF faculty, students and programs. The endowment along with other gifts for current operations provides approximately $40 million in annual support to USF.

List Major DSO Initiatives that will Drive Improvements in Operating Earnings for 2018 and 2019

[ 13 ]



REVENUES Gifts & Donations $48,500 $46,908 $1,592 3 % $48,094 $50,389Investment Income (Loss) 5,853 6,023 (170) (3)% 6,023 5,814Campaign Support 3,683 3,184 499 16 % 3,683 3,184University Support 9,492 9,216 276 3 % 9,216 9,415Other Revenues 2,347 2,110 237 11 % 2,110 2,553

Total Revenues 69,875 67,441 2,434 4 % 69,126 71,355

EXPENSES

Program Services

Salaries & Benefits $23,013 $22,343 670 3 % $16,250 $22,008 Scholarship & Fellowships 6,992 6,854 138 2 % 6,694 6,996 Service & independent contractors $4,404 4,317 86 2 % 4,459 $5,982 Supplies $2,619 2,568 51 2 % 3,015 $1,996 Other Transfers & Expenses $5,857 5,799 58 1 % 11,584 $12,201 Total Program Service Expense $42,885 $41,881 $1,004 2 % $42,002 $49,183

Fundraising & Operating Expenses

Salaries & Benefits 12,715 12,123 592 5 % 11,827 12,078 Service & independent contractors 690 624 66 11 % 918 1,000 Other Transfers & Expenses 3,684 3,593 91 3 % 4,293 3,031Total Fundraising & Operating Expenses 17,089 16,340 749 5 % 17,038 16,109

Total Expenses $59,974 $58,221 $1,753 3 % $59,040 $65,292

OPERATING PROFIT BEFORE NON-CASH CHANGES $9,902 $9,220 $681 7 % $10,086 $6,063

Unrealized Gains (Losses) 33,454 418 33,036 7,903 % 36,081 8,460Change in Fair Value of Swaps 0 0 0 % 0 0Total Non-Cash Changes $33,454 $418 $33,036 7,903 % $36,081 $8,460

NET OPERATING PROFIT $43,356 $9,638 $33,717 350 % $46,167 $14,523

Variance




[ 14 ]



OPERATING ACTIVITIES Net Operating Profit $43,356 $9,638 $33,717 350 % $46,167 $14,523Adjustments for Non-Cash Activities:Investment (gains) losses (33,454) (418) (33,036) (7,903)% (36,081) (8,462)Change in assets & liabilities, net (15,958) (15,165) (793) (5)% (15,967) (15,792)Total Cash From Operating Activities $(6,056) $(5,945) $(112) (2)% $(5,881) $(9,731)

INVESTING ACTIVITIES Capital Expenditures $0 $0 % $0 $89Net (Purchases) Sales of Investments 14,961 15,906 (945) (6)% 14,261 15,906Interest dividends reinvested (8,054) (8,095) 41 1 % (7,114) (5,812)Total Cash From Investing Activities $6,907 $7,811 $(904) (12)% $7,147 $10,183

FINANCING ACTIVITIES Proceeds of Long-Term Debt $0 $0 $0 % $0 $0Principal Paid on Debt (350) (330) (20) (6)% (480) (57)Total Cash From Financing Activities $(350) $(330) $(20) (6)% $(480) $(57)

CHANGE IN CASH 501 1,536 (1,036) (67)% 786 395

Cash, Beginning of Year 2,402 866 1,536 177 % 2,085 471Cash, End of Year $2,903 $2,402 $501 21 % $2,871 $866

Variance




[ 15 ]


Sun Dome, Inc. (SDI) manages and operates a multi-purpose facility known as the Sun Dome Arena on behalf of the University of South Florida (University) to provide the students, faculty, and staff of the University, as well as, the general public an array of cultural, athletic, and educational events.

List Key Drivers for Improvements in the 2017 Financial Plan Over 2016 - Focus on Cash Flows and Reserves

SDI will continue to push the premium parking option that can be purchased online. This driver is intended to be a revenue enhancement and patron amenity improvement. We anticipate parking to increase 2-3%, while also driving profitable event agreements to increase rental and service income, while also attracting more patrons to increase our facility fee income

SDI will also focus on continuous improvement related to sponsorships, commissions and royalties through targeted ancillary sales to match event patrons. SDI will strive to improve premium seating sales by increasing loge suites sales from 2 to 6 by marketing flexible and attractive packages that will include a diverse event mix and food offerings.

SDI will concentrate on attracting more profitable events compared to volume of events. The Sun Dome had 169 events in FY2015 compared to the FY2016 projetion of 137 events and we are forecasting to be ahead of 2016 plan.

There are no material capital expenditures currently planned for the fiscal year 2017

SDI provides an annual capital expenditures report to the University with a prioritized list of suggested/possible items but the organization does not foresee any of the items being necessary for FY2017.


SDI operates in a highly competitive environment for booking and hosting external events. There are 4 venues (Amalie Arena, Straz Center, Mid-Florida Credit Union Amphitheatre, Ruth Eckerd Hall) we consider competition in the marketplace while also viewing markets in close proximity St. Petersburg, FL and Orlando, FL as competition as it relates to tour routing in the state. SDI is also competing against an array of entertainment options that creates much competition for Tampa Bay area residents and visitors disposable income. Furthermore, SDI operates within an industry that can be highly cyclical and variable, including the number of touring artists, new and emerging event types, and maturing and/or declining event types.

Increase overall sponsorship participation within the Arena by 10%

Maximize unused meeting space areas by attracting local groups for meetings and retreat space




Sun Dome, Inc.


[ 16 ]

(In thousands) FY 2017 FY 2016 FY 2016 FY 2015

FINANCIAL FORECAST FINANCIAL ACTUAL


REVENUES Rent Income $622 $613 $9 1 % $503 $582Service Income 216 181 35 19 % 205 207Premium Seating 113 89 24 27 % 100 76Facility Fee 283 249 34 14 % 307 257Sponsorship, Commissions & Royalties 664 660 4 1 % 667 586Parking 373 363 10 3 % 307 299Other Revenues 231 244 (13) (5)% 234 991Total Revenues $2,502 $2,399 $103 4 % $2,323 $2,998

EXPENSES

Salaries & Wages $760 $659 $101 15 % $678 $664Payroll Taxes & Benefits 232 179 53 30 % 211 186Repairs, Maintenance and Utilities 260 301 (41) (14)% 273 284Operating & Administrative 272 273 (1) (0)% 363 338Management Fees 167 202 (35) (17)% 161 293Depreciation 236 236 0 0 % 236 237Total Expenses $1,927 $1,850 $77 4 % $1,922 $2,002

OPERATING PROFIT BEFORE

NON-CASH CHANGES $575 $549 $26 5 % $401 $996

Unrealized Investment Gains (Losses) 0 0 0 % 0 0Change in Fair Value of Swaps 0 0 0 % 0 0Total Non-Cash Changes $0 $0 $0 % $0 $0

NET OPERATING PROFIT $575 $549 $26 5 % $401 $996

INCOME STATEMENT

Variance

Sun Dome, Inc.


[ 17 ]

(In thousands) FY 2017 FY 2016 FY 2016 FY 2015

FINANCIAL FORECAST FINANCIAL ACTUAL


OPERATING ACTIVITIES Net Operating Profit $575 $549 $26 5 % $401 $996Adjustments for Non-Cash Activities:

Depreciation / Amortization 236 236 0 0 % 236 237Change in operating assets/liabilites 0 20 (20) (100)% 0 209

Total Cash From Operating Activities $811 $805 $6 1 % $637 $1,442

INVESTING ACTIVITIES Capital Expenditures $0 $0 $0 % $0 $0Net (Purchases) Sales of Investments 0 0 0 % 0 0Total Cash From Investing Activities $0 $0 $0 % $0 $0

FINANCING ACTIVITIES Proceeds of Long-Term Debt $0 $0 $0 % $0 $0Principal Paid on Debt (60) (60) 0 0 % (100) (832)Interest Paid 0 0 0 % (10) (10)Net transfers to USF - arena debt service (411) (411) 0 0 % (411) (414)Total Cash From Financing Activities $(471) $(471) $0 0 % $(521) $(1,256)

CHANGE IN CASH 340 334 6 2 % 116 186

Cash, Beginning of Year 1,258 924 334 36 % 810 738Cash, End of Year $1,598 $1,258 $340 27 % $926 $924

Sun Dome, Inc.


Variance


[ 18 ]


The USF Alumni Association exists to assist in the success of the University of South Florida. The Association does this by fostering a mutually beneficial, lifelong relationship between the University and its alumni, inspiring loyalty and pride among current and future alumni, and by advocating for excellence in teaching, research and public service.

The Alumni Association is in the alumni engagement and cultivation ("friend raising") business. The focus of the Association is to strengthen relationships with Alumni through myriad activities, thus leading to their long term involvement with the University of South Florida. Activities include alumni opportunities for volunteering, event participation, student mentoring, and financial support. All of this engagement activity by Alumni and friends supports the University as a whole. While the long term revenue associated with the Association's support is not directly reflected in the Association's statements, alumni engagement combined with development activity helps to facilitate fund raising success.


Membership revenue includes both annual and life membership. The Association has focused on life membership and seen exponential growth in this area over the last four years, with more new life memberships added in those four years then was gained in the prior 22. Life membership is now at 4,471 members. 90% of life membership revenue goes into an endowment, which is now valued in excess of $2.6 million. With this dramatic growth, life membership dividends supporting operations is increasing approximately 10% every year. Further, annual membership is also at an all time high, with more than 26,000 annual members generating $462k in revenue during fiscal year 2017.

Royalty revenue is projected to increase 21% during FY'17. The Association receives royalty revenue from various areas, including USF Credit Union for the affinity card program, Liberty Mutual for insurance programs, and through a relationship with the USF Bookstore. The relationship with the USF Federal Credit Union is very strong and the contract is performing well. Because of this, the Association expects an additional $23k in revenue associated with exceeding contractual minimums. The USF Bookstore contract increased during FY'16, and we expect an additional $40k in revenue as we realize a full year of this revenue. Also, the Association will be participating in a membership directory project with a third party. This is expected to bring an additional $25k in royalty revenue during FY'17.

Program revenue increased due to two factors, both involving events. First, the Association is hosting a new awards dinner during FY'17, which will be focused solely on the achievements of young alumni. USFAA expects $8k in event revenue for this event. Second, ticket prices for both FAST56 and the USF Awards Dinner were increased to cover the overall cost of the event, resulting in a $10k increase in revenue.

Two of the goals within the Association's five-year plan are to increase annual operating revenue to $3 million, and to reduce the amount of USF Foundation funding back to the base annual amount of $400k. The Association is closer to that goal with operating revenue of $2.6k, and for the fourth consecutive year, reduced Foundation financial support. This year's Foundation funding to the Association was reduced by $45k. Every dollar in net income improvement decreases the revenue amount from the Foundation, so there is no net income or cash flow impact. Once the Association's financial goals are met, a larger increase in cash flow and reserves are expected.

The Alumni Association has no anticipated capital expenditures during FY 2017.

University of South Florida Alumni Association, Inc.Annual Financial Plan for FY 2017



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Although not necessarily a short term risk, a potential long term risk is the renewal terms of future contracts for the affinity card and insurance royalty based programs. Negotiations on these contracts will commence in early fiscal year 2017.

The projected increase in sponsorship revenue doesn't materialize.

In 2015, USF Alumni Association Board of Directors put in place a 2020 strategic plan. This plan provides the high level direction and focus for the Association, including revenue goals listed above under key drivers for 2017. Additional focus areas include membership growth and alumni involvement with chapters and societies. These two items are described in more detail below.

Continued focus on life membership and the associated recurring revenue from the life member endowment distribution. The Association currently has 4,471 life members and is working to a goal of 7,500 life members by 2020.

Increasing the percentage of alumni members from the current 9.5% to 12% of the living alumni base.

Improve alumni engagement and participation at the chapter/society level by implementing an improvement program that provides for myriad relevant connection activities. Further, establish a culture of giving through scholarships benefiting a local USF student with a goal of 20% of all chapters and societies having established scholarship endowments. USFAA currently has 62 chapters and societies, with 12 groups with established scholarship funds. Phase three of the program will rollout in FY'17 with five additional new chapters opening a fund.

List Major DSO Initiatives that will Drive Future Operating Earnings

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REVENUES Program Revenue-Membership $597 $551 $46 8 % $530 $478Program Revenue 147 127 20 16 % 151 130License Plate Revenue 415 414 1 0 % 401 390Gifts & Donations 141 109 32 29 % 119 284Investment Income (Loss) 214 195 19 10 % 195 176Other: Foundation Support 625 671 (46) (7)% 675 715Other: Royalties 575 477 98 21 % 480 457

Other: Sponsorships 121 108 13 12 % 155 81Total Revenues $2,835 $2,652 $183 7 % $2,706 $2,711

EXPENSESSalaries & Benefits $1,578 $1,463 $115 8 % $1,475 $1,412Scholarships & Fellowships 71 56 15 27 % 53 88Contractual Services 23 32 (9) (28)% 31 28Materials & Supplies 5 3 2 67 % 3 21Program Services 913 879 34 4 % 929 923Utilities/Repairs/Maintenance 5 5 0 0 % 5 5

Total Expenses $2,595 $2,438 $157 6 % $2,496 $2,477OPERATING PROFIT BEFORE NON-CASH CHANGES $240 $214 $26 12 % $210 $234

Unrealized Investment Gains (Losses) 356 4 352 7,903 % 386 (127)Change in Fair Value of Swaps 0 0 0 % 0 0Total Non-Cash Changes $356 $4 $352 7,903 % $386 $(127)

NET OPERATING PROFIT $596 $218 $378 173 % $596 $107


INCOME STATEMENT

Variance

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OPERATING ACTIVITIES Net Operating Profit $596 $262 $334 128 % $596 $106Adjustments for Non-Cash Activities:

Unrealized Gain on Investments (356) (4) (352) (7,903)% (386) 127Change in operating assets/liabilities 110 108 2 2 % 104 (36)

Total Cash From Operating Activities $350 $366 $(16) (4)% $314 $197

INVESTING ACTIVITIES Net (Purchases) Sales of Investments $(347) $(358) $11 3 % $(309) $(194)Total Cash From Investing Activities $(347) $(358) $11 3 % $(309) $(194)

FINANCING ACTIVITIES Proceeds of Long-Term Debt $0 $0 $0 % $0 $0Principal Payments 0 0 0 % 0 0Interest Payments 0 0 0 % 0 0Total Cash From Financing Activities $0 $0 $0 % $0 $0

CHANGE IN CASH 3 7 (4) (59)% 5 3

Cash, Beginning of Year 14 7 7 102 % 12 4Cash, End of Year $17 $14 $3 20 % $17 $7



Variance

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The University of South Florida Research Foundation was established to promote, encourage, and enhance the research activities of University of South Florida faculty, staff and students. The Research Foundation provides a mechanism for the funding of licensed research and development activities. As a DSO, the Research Foundation provides broad and flexible financial mechanisms to administer private contracts and grants, including corporate and private foundation-sponsored programs. The Research Foundation assists the University in the commercialization of University inventions including license agreements, and receipt and distribution of royalties related to intellectual property. Net proceeds are used to further research and other endeavors at the University.


We have negotiated a debt restructure of the Series 2013-B $18,230,000 debt. The debt will convert from a Tax-Exempt Variable Rate Note with a Pay Fixed Interest Rate Swap to a Taxable 10-year Fixed Rate note. The Swap will not be renewed. Benefits include: 1. Locked in lower market interest rates - reduces our cost of capital 2. Improvement of the current business model by modifying the loan structure from Tax-Exempt to Taxable with potential increase to rental income 3. Reduction of the risk associated with variable rate debt and swaps 4. Improved credit terms

The Series 2013-D $9,525,000 outstanding debt will be paid off. The lender has tendered the note effective August 1, 2016. Benefits include: 1. There are no prepayment penalties on the note; payoff to coincide with expiration of Swap thus no termination fee 2. Reduced debt service and cost of capital will decrease operating costs of the Incubator Program and increase cash flow 3. Free up debt capacity to allow for new building development

$712 thousand of tenant improvements may be expended to generate additional rent revenues if needed. If the leases are not awarded or the improvements are not required for lease incentive, these improvements will not be made.

$621 thousand of capital expenditures are included in the 2017 Plan for maintaining functionality of the property and buildings. These include projects designed to reduce operating utility costs, and preserving the research buildings within the Research Park, as Class A properties.

The Research Foundation Board of Directors approved up to $500 thousand for a revision of the USF Research Park Master Plan along with initiation of design of a new mixed use laboratory and office facility. All activities will be in alignment with the University Strategic Plan and further the Innovation District Concept to create a vibrant community. $400 thousand is included in the 2017 Plan to commence these projects.


USF Research Foundation, Inc.



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Occupancy within the Research Park is essentially at capacity except for 23,000 sq ft vacated early by Draper. Lease settlement occurred in FY16. There is encouraging potential interest in the space and the goal is for occupancy by mid FY17, however the potential risk of vacancy remains.

As a result of the debt restructuring described above, we expect the benefits of decreased operating expenses and cost of capital to continue for 2018 and 2019.


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REVENUES Rental Revenue $7,813 $7,859 $(46) (1)% $8,018 $7,526Intellectual Property (IP) Revenue 2,825 2,500 325 13 % 2,500 2,697Less - IP Revenue (on behalf of USF) (625) (600) (25) (4)% (600) (576)Incubator Program Revenue 1,726 1,616 110 7 % 1,676 1,637NMR License Revenue 244 307 (63) (21)% 244 307Economic Development Grant 0 0 0 % 0 120Other Revenues 211 196 15 8 % 161 181Total Revenues $12,193 $11,878 $315 3 % $11,998 $11,892

EXPENSESSalaries & Benefits $1,539 $1,281 $258 20 % $1,302 $1,184Contractual Services 120 131 (11) (8)% 212 145Program Exp -IP, Incubator & Univ Support 2,016 1,611 405 25 % 1,694 1,191Operations - Utilities / Repairs / Maintenance 3,447 3,096 350 11 % 3,381 2,973Other Operating Expenses 53 46 7 16 % 46 42Interest Expense 996 1,733 (737) (43)% 1,733 1,816Depreciation & Amortization 2,824 2,993 (169) (6)% 2,920 2,923Total Expenses $10,995 $10,891 $104 1 % $11,288 $10,274

OPERATING INCOME BEFORE NON-OPERATING $1,198 $987 $211 21 % $710 $1,617

Investment Income 1,120 243 876 360 % 1,842 998Other Non-Operating Income (Loss) 0 (3) 3 100 % 0 0Total Non-Operating Revenue $1,120 $240 $879 366 % $1,842 $998

NET INCOME (Increase in Net Position) $2,318 $1,227 $1,091 89 % $2,551 $2,616

USF Research Foundation, Inc.


INCOME STATEMENT

Variance

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OPERATING ACTIVITIES Net Income $2,318 $1,227 $1,091 89 % $2,551 $2,616Adj for Non-Cash Revenue/Expenses:

Add back Depreciation/Amortization Exp 2,824 2,993 (169) (6)% 2,920 2,923Add back Other Non Cash Expenses 110 116 (6) (5)% 158 152Less Non Cash Investment Gain (1,120) (243) (876) (360)% (1,842) (998)Less Non Cash Revenue 0 (63) 63 100 % (244) (366)

Change in Assets and Liabilities (net) - - - % - (119)Total Cash From Operating Activities $4,132 $4,030 $103 3 % $3,544 $4,208

INVESTING ACTIVITIES Capital Expenditures $(1,733) $(1,202) $(531) (44)% $(1,202) $(804)Net Sales (Purchases) of Investments 9,255 - 9,255 % - (641)Transfer from Venture Investment Fund 220 210 10 5 % 300 150Seed Capital Loan Funding (220) (210) (10) (5)% (300) (150)Total Cash From Investing Activities $7,522 $(1,202) $8,724 726 % $(1,202) $(1,445)

FINANCING ACTIVITIES Pay Off Debt $(9,255) - (9,255) % $0 $0Principal Paid on Debt (1,565) (1,680) 115 7 % (1,680) (1,630)Lease Settlement - 551 (551) (100)% - -

Total Cash From Financing Activities $(10,820) $(1,129) $(9,691) (858)% $(1,680) $(1,630)

CHANGE IN CASH 835 1,699 (864) (51)% 663 1,133

Cash, Beginning of Year 5,102 3,403 1,699 50 % 3,403 2,270Cash, End of Year $5,936 $5,102 $835 0 % $4,066 $3,403

USF Research Foundation, Inc.Annual Financial Plan for FY 2017


Variance

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In 2013, the maturity of the Health Series 2013A bank bonds privately placed with JP Morgan Chase Bank was matched to the July 1, 2016 expiration of the related interest rate swap, creating an opportunity to convert $38 M of variable rate bonds to fixed rate debt in fiscal year 2017.

A rate lock agreement was executed on November 25, 2015, committing the bank to a 10-year fixed rate of 2.31%. The restructuring will reduce interest costs and variable rate structure remarketing, renewal, and interest rate swap exposures.

Present value savings total $7.2 M, or 18.9%, reducing annual debt service payments by approximately $500,000 over the next 10 years. The transaction is expected to close on July 1, 2016.


In 2013, the maturity of the Health Series 2013B bank bonds privately placed with JP Morgan Chase Bank was matched to the July 1, 2018 expiration of the related interest rate swap, creating an opportunity to convert $19 M of variable rate bonds to fixed rate debt in fiscal year 2019.

In Fall 2017, the Corporation will likely issue an Invitation to Negotiate for refinancing terms to interested financial institutions.

USF's tax-exempt borrowing rates could also be affected by proposed changes in the Federal Tax Code.

Health Bonds 2017 Refunding Initiative

The Corporation will continue to work with University and campus leaders to assist with structuring new debt programs or restructure existing programs to meet their needs.



USF Financing Corporation & USF Property CorporationAnnual Financial Plan for FY 2017


The Financing Corporation is the University's financing arm and is expected to provide low cost, low risk, long-term financing for the University's major capital projects.

The Financing Corporation is a conduit financing entity, which issues debt on behalf of the University and which receives pledged revenues or lease payments from the University's major business units to pay debt service on their capital projects.

Health Bonds 2016 Refunding Initiative

The Corporation is not anticipating capital expenditures in 2017, but will continue to be responsive to the University's needs for attractive long-term capital financing.

The Corporation manages exposures to adverse operating and financial performance on a monthly basis for each of its 13 debt programs, including the management of USF's 6 interest rate swaps (with 3 expiring in FY 2017).

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REVENUES USF housing system gross revenues $42,082 $42,032 $50 0 % $41,873 $42,937USF Marshall Center lease revenue 2,488 2,064 424 21 % 2,449 2,749USF athletics system lease revenue 1,984 1,992 (8) (0)% 1,940 2,003Arena revenue 883 918 (35) (4)% 1,011 1,000MSSC lease revenue 4,043 4,612 (569) (12)% 4,629 4,600HPCC (CAMLS) lease revenue 1,855 1,853 2 0 % 1,858 1,856Total Revenues $53,335 $53,471 $(136) (0)% $53,760 $55,145

EXPENSESUSF housing system operating expenses $21,455 $22,019 $(564) (3)% $20,928 $20,955Management fee 672 665 7 1 % 526 680Interest expense 13,919 15,248 (1,329) (9)% 15,216 16,131Depreciation expense 7,811 7,811 0 0 % 9,396 9,124General and administrative expenses 556 528 28 5 % 584 568Total Expenses $44,413 $46,271 $(1,858) (4)% $46,650 $47,458

OTHER REVENUES (EXPENSES)Transfers (to) from DSOs/auxiliaries $(8,872) $(7,204) $(1,668) (23)% $(7,114) $(7,575)Loss on debt extinguishment (54) 0 (54) % 0 (118)Interest income 4 4 0 0 % 4 6Total Other Revenues (Expenses) $(8,922) $(7,200) $(1,722) (24)% $(7,110) $(7,687)

OPERATING PROFIT BEFORE NON-CASH CHANGES $0 $0 $0 % $0 $0

INTO USF investment - unrealized gain 1,500 2,028 (528) (26)% 1,489 1,562Change in fair value of swaps 0 (1,979) 1,979 100 % 0 4,614Transfers (to) from DSOs to offset swaps 0 1,979 (1,979) (100)% 0 (4,614)Total Non-Cash Changes $1,500 $2,028 $(528) (26)% $1,489 $1,562

NET OPERATING PROFIT $1,500 $2,028 $(528) (26)% $1,489 $1,562

Variance


INCOME STATEMENT

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OPERATING ACTIVITIES Net Operating Profit $1,500 $2,028 $(528) (26)% $1,489 $1,562Adjustments for Non-Cash Activities:

Amortization of Deferred Charges 90 110 (20) (18)% 92 84Loss on Debt Extinguishment 54 0 54 % 0 118Depreciation Expense 7,811 7,811 0 0 % 9,396 9,124Net Amortization of Premiums / Discounts (252) (87) (165) (190)% (103) (100)Change in Fair Value of Swaps 0 1,979 (1,979) (100)% 0 (4,614)Change in Fair Value of Equity Investment (1,500) (2,028) 528 26 % (1,489) (1,562)Adjustments for Changes in

Operating Assets and Liabilities 19,786 15,426 4,360 28 % 12,545 27,410Total Cash From Operating Activities $27,489 $25,239 $2,250 9 % $21,930 $32,022

INVESTING ACTIVITIES Capital Expenditures $0 $0 $0 % $0 $(873)Net (Purchases) Sales of Investments (1,893) (1,801) (92) (5)% (1,728) 711Total Cash From Investing Activities $(1,893) $(1,801) $(92) (5)% $(1,728) $(162)

FINANCING ACTIVITIES Cash Paid for Debt Issuance Costs $50 $0 $50 % $0 $(940)Debt Proceeds - Refunding 37,920 0 37,920 % 0 149,822Principal Payments - Refunding (37,920) 0 (37,920) % 0 (151,955)Principal Payments (11,076) (7,040) (4,036) (57)% (7,040) (10,815)Interest Payments (14,570) (13,148) (1,422) (11)% (13,162) (18,302)Security Pledged to Counterparty 0 (3,250) 3,250 100 % 0 330Total Cash From Financing Activities $(25,596) $(23,438) $(2,158) (9)% $(20,202) $(31,860)

CHANGE IN CASH 0 0 0 % 0 0

Cash, Beginning of Year 3 3 0 0 % 3 3Cash, End of Year $3 $3 $0 0 % $3 $3

Variance



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Documents

DIRECT SUPPORT ORGANIZATIONS · The private/public partnerships and client relationships unique to CAMLS is laying the foundation to replace outdated healthcare methodologies. Partnering