Phoebe Sumter Medical Center Inc

“During fiscal year 2007, sumter regional hospital, as operated by the authority, was destroyed in a tornado. The americus-sumter county hospital authority (authority) entered into a lease and transfer agreement which included the construction of a new hospital facility. The authority has received proceeds from the federal emergency management agency (fema) and the georgia emergency management agency (gema) for a portion of the construction costs of the new hospital and intends to pursue further reimbursement from fema and gema to the fullest extent possible. It is anticipated, based on guidance received from an independent consultant, that the project audits are likely to be conducted by fema and gema once all outstanding claims are closed, which could result in demand(s) to recover a portion of the funds paid to the authority. Effective with an amendment to the lease and transfer agreement (amendment) dated september 27, 2016, the authority transferred approximately 11,745,000 of receipts from fema and gema to the hospital. The amendment specifies that the fema and gema funds may be used for the following purposes: .... First, to pay fema and gema all sums determined to be owed as a result of any audits. .... Second, and only after adequate provision for the funding of the first bullet point, the funds can be used to fund physician development in the hospitals service area. .... Third, and only after adequate provision for the first two bullet points above, the funds can be used by the hospital for any purposes permitted under the lease and transfer agreement. Also in accordance with the amendment, the hospital agreed to establish a separate account to hold the sum of 4,000,000 of the above funds until the conclusion of the expected fema and gema audits to ensure the immediate availability of funds to repay any amounts finally determined to be owed to fema and gema as a result of the audits. Should the 4,000,000 not be sufficient to repay any amounts due to fema and gema, the hospital agrees that it will pay in full and fully indemnify the authority for all related sums finally determined to be owed to fema and gema. The amendment states that the adequate provision of both the fema and gema fund repayment and the adequate provision to fund physician development are to be determined at the sole discretion of the hospital. Per a hospital board of directors resolution dated november 1, 2016, the hospital believes the 4,000,000 is adequate provision for the repayment of the fema and gema funds. Also, based on the current and long-term physician development plan, coupled with the requirement that the hospital chief executive officer report on the efforts and results of physician development at each board of directors meeting, and the requirement that the hospitals board of directors approve the budget and strategic plan each year, the hospital believes this constitutes adequate provision for the funding of physician development. During the fiscal year, the authority agreed to allow the hospital to withdraw 1,000,000 from the account.”

“The hospital is a not-for-profit corporation that has been recognized as tax-exempt pursuant to section 501(c)(3) of the internal revenue code. The hospital applies accounting policies that prescribe when to recognize and how to measure the financial statement effects of income tax positions taken or expected to be taken on its income tax returns. These rules require management to evaluate the likelihood that, upon examination by the relevant taxing jurisdictions, those income tax positions would be sustained. Based on that evaluation, the hospital only recognizes the maximum benefit of each income tax position that is more than 50% likely of being sustained. To the extent that all or a portion of the benefits of an income tax position are not recognized, a liability would be recognized for the unrecognized benefits, along with any interest and penalties that would result from disallowance of the position. Should any such penalties and interest be incurred, they would be recognized as operating expenses. Based on the results of management's evaluation, no liability is recognized in the accompanying balance sheets for unrecognized income tax positions. Further, no interest or penalties have been accrued or charged to expense as of july 31, 2024 and 2023 or for the years then ended. The hospital's tax returns are subject to possible examination by the taxing authorities. For federal income tax purposes, the tax returns essentially remain open for possible examination for a period of three years after the respective filing deadlines of those returns.”

“Rental expenses -25,110 capital contribution 613,689”

“RENTAL EXPENSES 25,110”