U asks for $36M grant to cover debt

By By Michael McFall

By Michael McFall

The U wants the local government to give it $36 million to solve its debt problem8212;administrators will make good on paying it back, they swear.

The bond is meant to resolve the U’s outstanding debt of $36 million, a debt it accumulated after purchasing two buildings for U Hospital and Clinics. U President Michael Young will recommend that the U Board of Trustees approve the bond at its next meeting, scheduled for Tuesday morning at the Marriott Library.

The U Hospital and Clinics would repay the bond through the revenue they generate during the next 15 years, according to the agenda.

The U accumulated the debt through two projects.

Seven years ago, the Salt Lake County government assisted the U in purchasing and financing the Ambassador Building, which the U Hospitals and Clinics wanted to use as a business operations center. The outstanding debt from its transactions was nearly $11 million, according to the U Board of Trustees’ October agenda.

On top of that, the U’s orthopaedic department created the Utah Orthopaedic Foundation, a nonprofit corporation that assists the U in financing its medical facilities. This included the orthopaedic center. The foundation’s outstanding debt after purchasing that building is about $25 million.

The U Hospital and Clinics wants to cover the remaining debt with the revenue bond, which would be issued through the Board of Regents8212;the education governing body that will ultimately have to approve the Board of Trustees’ decision before it becomes official.

U Hospital and Clinics administration is postponing comment until after Tuesday’s meeting, said spokesman Chris Nelson.

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