Utah State University

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3 Supplemental Continuing Disclosure Memorandum Summary of Debt Structure and Financial Information SEC Rule 15c2 12 For The State Board of Regents of the State of Utah Utah State University Filed with Electronic Municipal Market Access (EMMA) Submitted and dated as December 23, 2015 (Annual submission required on or before December 27, 2015)

4 Table Of Contents Page SUPPLEMENTAL CONTINUING DISLCOSURE MEMORANDUM... 1 The State Board Of Regents Of The State of Utah; Utah State University... 1 Contact Persons For The Board of Regents And The University... 1 DISCLOSURE SPECIFIC TO RESEARCH REVENUE BONDS (CUSIP )... 2 Research Revenue Bonds... 2 $22,000,000 State Board of Regents of the State of Utah Utah State University Research Revenue Bonds, Series $11,070,000 State Board of Regents of the State of Utah Utah State University Research Revenue Refunding Bonds, Series $19,500,000 State Board of Regents of the State of Utah Utah State University Federally Taxable Research Revenue Bonds, Series $13,145,000 State Board of Regents of the State of Utah Utah State University Research Revenue Refunding Bonds, Series 2015B... 6 Description Of Revenue Sources... 7 Management Discussion of Revenues... 9 Historical Revenues And Debt Service Coverage Outstanding Debt Of The University Debt Service Schedule Of Outstanding Debt Of The University By Fiscal Year Financial Summaries FINANCIAL REPORT OF UTAH STATE UNIVERSITY FOR FISCAL YEAR

5 SUPPLEMENTAL CONTINUING DISLCOSURE MEMORANDUM The State Board Of Regents Of The State of Utah; Utah State University The State Board of Regents of the State of Utah (the Board of Regents ) is vested by Utah statute with control, management and supervision of the State of Utah institutions of higher education. Utah State University of Agriculture and Applied Science, also known as Utah State University (the University ) is one of the institutions of the State system of higher education and had a combined enrollment for Academic Year (Fall Semester 2014) of 28,707 students. The University is located in the City of Logan, Utah (the City ). The City, incorporated in 1866, is the county seat of the Cache County, Utah (the County ) and had 49,913 residents (according to a 2013 estimate by the U.S. Census Bureau), and was ranked as the 12 th most populous city in the State (out of 246 municipalities in the State). The County is located approximately 90 miles north of Salt Lake City, Utah and 20 miles south of the Utah Idaho border. The County, incorporated in 1857, had 118,343 residents according to the 2014 population estimate by the U.S. Census Bureau, ranking the County as the 6 th most populated county in the State (out of 29 counties). The State Board of Regents maintains a Web site that may be accessed at The University maintains a Web site that may be accessed at The information available at these Web sites is provided by the State Board of Regents and the University in the course of its normal operations and has not been reviewed for accuracy or completeness. Such information is not a part of Supplemental Continuing Disclosure Memorandum. When used herein the terms Fiscal Year[s] or Fiscal Year[s] End[ed][ing] June 30, 20YY shall refer to the year beginning on July 1 and ending on June 30 of the year indicated. Contact Persons For The Board of Regents And The University As of the date of this Supplemental Continuing Disclosure Memorandum, the chief contact person for the Board of Regents is: Gregory L. Stauffer Associate Commissioner for Planning, Finance & Facilities gstauffer@ushe.edu Utah State Board of Regents 60 S 400 W Salt Lake City UT f As of the date of this Supplemental Continuing Disclosure Memorandum, the chief contact person for the University is: David T. Cowley Vice President for Business and Finance dave.cowley@usu.edu Utah State University 1445 Old Main Hill Logan UT f

6 DISCLOSURE SPECIFIC TO RESEARCH REVENUE BONDS (CUSIP ) Research Revenue Bonds The University acting for and on behalf of the Board of Regents and is providing continuing disclosure on four research revenue bonds. 1. $22,000,000 State Board of Regents of the State of Utah Utah State University Research Revenue Bonds, Series 2009 Bonds dated: May 20, 2009 CUSIP numbers on the 2009 Research Revenue Bonds are provided below. Background Information. The $22,000,000, State Board of Regents of the State of Utah, Utah State University, Research Revenue Bonds, Series 2009, dated May 6, 2009 (the 2009 Research Revenue Bonds ), were issued by the Board of Regents for and on behalf of the University and were awarded pursuant to competitive bidding received by means of the Parity electronic bid submission system on May 6, 2009 to Robert W. Baird & Co., Incorporated, Milwaukee, Wisconsin; as Senior Manager; with Charles Schwab, San Francisco, California; Coastal Securities Inc., Houston, Texas; Southwest Securities, Inc., Encino, California; Davenport & Co. L.L.C., Richmond, Virginia; Loop Capital Markets, New York, New York; William Blair & Company, L.L.C., Chicago, Illinois; Wedbush Morgan Securities, Phoenix, Arizona; Kildare Capital, Inc., Philadelphia, Pennsylvania; SAMCO Capital Markets, Dallas, Texas; Edward D. Jones & Co., St. Louis, Missouri; and C.L. King & Associates, New York, New York; as Co Managers at a true interest rate of 4.28%. Zions Bank Public Finance, Salt Lake City, Utah acted as Municipal Advisor. The 2009 Research Revenue Bonds were issued by the Board of Regents for and behalf of the University, as fully registered bonds, registered in the name of Cede & Co., as nominee for The Depository Trust Company, New York, New York ( DTC ). DTC currently acts as securities depository for the 2009 Research Revenue Bonds. Principal of and interest on the 2009 Research Revenue Bonds (interest payable June 1 and December 1 of each year) are payable by Wells Fargo Bank, NA, Corporate Trust Services ( Wells Fargo Bank ), as Paying Agent, to the registered owners thereof, currently DTC. Optional Redemption. The 2009 Research Revenue Bonds maturing on or before December 1, 2018 are not subject to optional redemption prior to maturity. The 2009 Bonds maturing on or after December 1, 2019 were refunded by the 2015B Research Bonds (as defined herein). (The remainder of this page has been intentionally left blank.) CUSIP is a registered trademark of the American Bankers Association. CUSIP Global Services (CSG) is managed on behalf of the American Bankers Association by S&P Capital IQ. 2

7 Current Maturity Schedule. Current principal outstanding: $2,725,000 Original issue amount: $22,000,000 Dated: May 20, 2009 Due: December 1, as shown below Due December 1 CUSIP Principal Amount Original Interest Rate Due December 1 CUSIP Principal Amount Original Interest Rate CQ9 $ 875, % CY2 $1,250, % CR7 900, CZ9 1,300, CS5 950, DA3 1,375, CT3 1,000, DB1 1,425, CU0 1,050, DC9 1,500, CV8 1,100, DD7 1,275, CW6 1,150, DE5 1,325, CX4 1,225, (Strikethrough) These maturities were refunded by the 2015B Research Bonds (as defined herein). Security. The 2009 Research Revenue Bonds are payable, on a parity with the outstanding parity bonds, from and are secured solely by a pledge and assignment of Revenues and moneys on deposit in the funds and accounts established by the indenture (other than moneys held to pay arbitrage rebate). The Revenues generally consist of those revenues received by the University, pursuant to research and training contracts and grants awards, attributable to the costs of buildings and equipment, operation and maintenance, general administration and other indirect costs. The Revenues also include net reimbursed overhead revenues from the contracts and grants held by the Utah State University Research Foundation, a non profit corporation controlled by the University (the USU Research Foundation ). 2. $11,070,000 State Board of Regents of the State of Utah Utah State University Research Revenue Refunding Bonds, Series 2010 Bonds dated: July 28, 2010 CUSIP numbers on the 2010 Research Revenue Bonds are provided below. Background Information. The $11,070,000, State Board of Regents of the State of Utah, Utah State University, Research Revenue Refunding Bonds, Series 2010, dated July 28, 2010 (the 2010 Research Revenue Bonds ), were issued by the Board of Regents for and on behalf of the University and were awarded pursuant to competitive bidding received by means of the Parity electronic bid submission system on July 15, 2010 to J.P. Morgan Securities Inc., New York, New York at a true interest rate of 1.71%. Zions Bank Public Finance, Salt Lake City, Utah acted as Municipal Advisor. The 2010 Research Revenue Bonds were issued by the Board of Regents for and behalf of the University, as fully registered bonds, registered in the name of Cede & Co., as nominee for DTC. DTC currently acts as securities depository for the 2010 Research Revenue Bonds. Principal of and interest on the 2010 Research Revenue Bonds (interest payable June 1 and December 1 of each year) are payable by Wells Fargo Bank, as Paying Agent, to the registered owners thereof, currently DTC. 3

8 Optional Redemption. The 2010 Research Revenue Bonds are not subject to redemption prior to maturity. Current Maturity Schedule. Current principal outstanding: $4,500,000 Original issue amount: $11,070,000 Dated: July 28, 2010 Due: December 1, as shown below Due December 1 CUSIP Principal Amount Original Interest Rate DT2 $2,200, % DU9 2,300, Security. The 2010 Research Revenue Bonds are payable, on a parity with the outstanding parity bonds, from and are secured solely by a pledge and assignment of Revenues and moneys on deposit in the funds and accounts established by the indenture as described above under the caption Security. Credit Enhancement. The scheduled payment of principal of and interest on the 2010 Research Revenue Bonds are guaranteed under a municipal bond insurance policy issued by Assured Guaranty Municipal Corp. ( AGM ). 3. $19,500,000 State Board of Regents of the State of Utah Utah State University Federally Taxable Research Revenue Bonds, Series 2015 Bonds dated: October 8, 2015 CUSIP numbers on the 2015 Research Revenue Bonds are provided below. Background Information. The $19,500,000, State Board of Regents of the State of Utah, Utah State University, Federally Taxable Research Revenue Bonds, Series 2015, dated October 8, 2015 (the 2015 Research Revenue Bonds ), were issued by the Board of Regents for and on behalf of the University and were awarded pursuant to a negotiated sale on September 22, 2015 to Piper Jaffray, Minneapolis, Minnesota at a true interest rate of 4.55%. Zions Bank Public Finance, Salt Lake City, Utah acted as Municipal Advisor. The 2015 Research Revenue Bonds were issued by the Board of Regents for and behalf of the University, as fully registered bonds, registered in the name of Cede & Co., as nominee for DTC. DTC currently acts as securities depository for the 2015 Research Revenue Bonds. Principal of and interest on the 2015 Research Revenue Bonds (interest payable June 1 and December 1 of each year) are payable by Wells Fargo Bank, as Paying Agent, to the registered owners thereof, currently DTC. Make Whole Redemption. The 2015 Research Revenue Bonds are subject to redemption prior to maturity in whole or in part, on any date, at the option of the Board of Regents, upon written notice to the Trustee, at the Make Whole Redemption Price (defined below), together with accrued interest to the date fixed for redemption. The Make Whole Redemption Price is equal to the greater of (a) 100% of the principal amount of any 2015 Research Revenue Bonds to be redeemed, and (b) the sum of the present values of the remain- 4

9 ing scheduled payments of principal and interest on any 2015 Research Revenue Bonds being redeemed (exclusive of interest accrued to the date of redemption) discounted to the redemption date on a semiannual basis (assuming a 360 day year consisting of 12, 30 day months) at the Treasury Rate (defined below) plus 30 basis points. The term Treasury Rate means, as of any redemption date, the yield to maturity as of such redemption date of United States Treasury Securities with a constant maturity (as compiled and published in the most recent Federal Reserve Statistical Release H.15 (519) that has become publicly available at least two Business Days prior to the redemption date (excluding inflation indexed securities) (or, if such Statistical Release is no longer published, any publicly available source of similar market data)) most nearly equal to the period from the redemption date to the maturity date of the 2015 Research Revenue Bonds to be redeemed; provided, however, that if the period from the redemption date to such maturity date is less than one year, the weekly average yield on actually traded United States Treasury securities adjusted to a constant maturity of one year will be used. Current Maturity Schedule. Current principal outstanding: $19,500,000 Original issue amount: $19,500,000 Dated: October 8, 2015 Due: December 1, as shown below $3,605,000 Serial Bonds Due December 1 CUSIP Principal Amount Original Interest Rate Due December 1 CUSIP Principal Amount Original Interest Rate HT8 $365, % HY7 $405, % HU5 370, HZ4 420, HV3 380, JA7 435, HW1 385, JB5 450, HX9 395, $2,535, % Term Bond due December 1, 2030 (CUSIP JC3) $3,155, % Term Bond due December 1, 2035 (CUSIP JD1) $3,115, % Term Bond due December 1, 2039 (CUSIP JF6) $7,090, % Term Bond due December 1, 2046 (CUSIP JE9) Mandatory Sinking Fund Redemption. The 2015 Research Revenue Bonds maturing on December 1, 2030, December 1, 2035, December 1, 2039, and December 1, 2046 (collectively, the 2015 Term Bonds ) are subject to mandatory sinking fund redemption, at a price equal to 100% of the principal amount thereof, plus accrued interest to the redemption date, on the dates and in the principal amounts as follows: Mandatory Sinking Fund Redemption Date Sinking Fund Requirements December 1, $ 465,000 December 1, ,000 December 1, ,000 December 1, ,000 December 1, 2030 (final maturity) ,000 Total... $2,535,000 5

10 Mandatory Sinking Fund Redemption Date Sinking Fund Requirements December 1, $ 575,000 December 1, ,000 December 1, ,000 December 1, ,000 December 1, 2035 (final maturity) ,000 Total... $3,155,000 December 1, $ 725,000 December 1, ,000 December 1, ,000 December 1, 2039 (final maturity) ,000 Total... $3,115,000 December 1, $ 875,000 December 1, ,000 December 1, ,000 December 1, ,010,000 December 1, ,055,000 December 1, ,110,000 December 1, 2046 (final maturity)... 1,165,000 Total... $7,090,000 If less than all of any of the 2015 Term Bonds of a maturity are redeemed in a manner other than pursuant to a mandatory sinking fund redemption, the principal amount so redeemed shall be credited at 100% of the principal amount of the 2015 Term Bond of such maturity redeemed by the Trustee against the obligation of the Board of Regents on future mandatory sinking fund redemption dates for such 2015 Term Bonds in such order as shall be directed by the Board of Regents. Security. The 2015 Research Revenue Bonds are payable, on a parity with the outstanding parity bonds, from and are secured solely by a pledge and assignment of Revenues and moneys on deposit in the funds and accounts established by the indenture as described above under the caption Security. Credit Enhancement. The scheduled payment of principal of and interest on the 2015 Research Revenue Bonds are guaranteed under a municipal bond insurance policy issued by AGM. 4. $13,145,000 State Board of Regents of the State of Utah Utah State University Research Revenue Refunding Bonds, Series 2015B Bonds dated: December 22, 2015 CUSIP numbers on the 2015B Research Revenue Bonds are provided below. Background Information. The $13,145,000, State Board of Regents of the State of Utah, Utah State University, Research Revenue Refunding Bonds, Series 2015B, dated December 22, 2015 (the 2015B Research Revenue Bonds ), were issued by the Board of Regents for and on behalf of the University and were awarded pursuant to a negotiated sale on December 2, 2015 to CitiGroup Global Markets Inc., New York, New York at a true interest rate of 2.57%. Zions Bank Public Finance, Salt Lake City, Utah acted as Municipal Advisor. 6

11 The 2015B Research Revenue Bonds were issued by the Board of Regents for and behalf of the University, as fully registered bonds, registered in the name of Cede & Co., as nominee for DTC. DTC currently acts as securities depository for the 2015B Research Revenue Bonds. Principal of and interest on the 2015B Research Revenue Bonds (interest payable June 1 and December 1 of each year) are payable by Wells Fargo Bank, as Paying Agent, to the registered owners thereof, currently DTC. Optional Redemption. The 2015B Bonds maturing on or prior to December 1, 2025, are not subject to optional redemption prior to maturity. The 2015B Bonds maturing on or after December 1, 2026 are subject to redemption at the option of the Board of Regents on December 1, 2025, and on any date thereafter prior to maturity, in whole or in part, from such maturities as may be selected by the Board of Regents, and at random within each maturity if less than the full amount of any maturity is to be redeemed, upon not less than 30 days prior written notice, at a redemption price equal to 100% of the principal amount of the 2015B Bonds to be redeemed, plus accrued interest thereon to the redemption date. Current Maturity Schedule. Current principal outstanding: $13,145,000 Original issue amount: $13,145,000 Dated: December 22, 2015 Due: December 1, as shown below Due December 1 CUSIP Principal Amount Original Interest Rate Due December 1 CUSIP Principal Amount Original Interest Rate JG4 $ 875, % JN9 $1,160, % JH2 920, JP4 1,235, JJ8 965, JQ2 1,280, JK5 1,005, JR0 1,335, JL3 1,080, JS8 1,080, JM1 1,105, JT6 1,105, Security. The 2015B Research Revenue Bonds are payable, on a parity with the outstanding parity bonds, from and are secured solely by a pledge and assignment of Revenues and moneys on deposit in the funds and accounts established by the indenture as described above under the caption Security. Description Of Revenue Sources Research Activities. Research at the University centers around land, water, plants and animals (and the management of these resources), and the atmosphere and space. The University s research draws upon the specific talents, interests and assignments of the current faculty. Research at the University responds to present and future needs by developing practical, innovative means to implement research results to the benefit of local, state, national and world communities. The University has achieved international acclaim for its research in the following major areas: water and other natural resources; agriculture; space engineering and science; education of disabled persons; and biotechnology. These research programs are interdisciplinary for the most part and are administered through eight major research centers: Space Dynamics Laboratory; Utah Water Research Laboratory; Agriculture Experiment Station; Center for Space Engineering; Center for Atmospheric and Space Science; Center for Persons with Disabilities; Ecology Center; and Center for Biotechnology. During the last decade, the University ranked among the top 20% of all U.S. colleges and universities in federal research and development dollars. In Fiscal Years 2011 through 2015, the University was able to attract contracts and grant awards ranging from $187 million to $227 million. About 88% of the funds 7

12 are for federally sponsored research and training programs; the remainder is a combination of state and private funds. See Contracts and Grants below. Contracts and grant awards cover direct costs such as staff salaries, travel, laboratory equipment, supplies, direct computer charges and many other direct costs. Contracts and grants also provide funds to the University for indirect costs. Research contracts and grants entered into by the University have an average life of approximately three to five years. Furthermore, many contracts and grants entered into between the University and the United States government or other governmental sponsors are subject to annual appropriation of funds. USU Research Foundation. The USU Research Foundation is a nonprofit Scientific Research and Development IRS 501(c)(3) corporation, which is wholly owned by the University. Major research projects are focused in sensor and infrared measurements systems. The USU Research Foundation is involved in state of the art research in this area and is recognized as a world leader. The USU Research Foundation has other research projects in many related areas of interest. Research funding consists primarily of federal funds. The USU Research Foundation s Space Dynamics Laboratory occupies an essential position in critical space research, as well as being a recognized leader in the area of space science and engineering education. Contracts and Grants. In Fiscal Year 2015 the University received approximately $227 million in research and student aid funding from all external sources. The following table sets forth the awards received by the various colleges within the University for each of the Fiscal Years indicated. Schedule of Contracts and Grants Awards Fiscal Year (1) 2011 Engineering... $ 87,096,339 $ 88,539,398 $ 71,554,700 $ 82,794,334 $ 68,401,688 Miscellaneous... 61,613,552 56,182,738 56,307,007 54,489,926 66,637,420 Education... 40,039,343 27,187,813 24,027,748 27,616,254 40,210,629 Agriculture... 19,133,660 19,026,344 13,424,828 21,310,465 18,629,285 Science... 9,764,040 14,920,377 6,536,977 9,955,560 13,077,405 Natural Resources... 7,669,091 9,855,978 13,443,810 8,666,404 9,931,834 Humanities and Social Science... 1,843, ,613 1,376,804 2,049, ,168 Arts ,000 31,700 15, ,435 39,500 Business , ,401 Totals... $227,345,983 $216,843,079 $186,687,074 $207,060,032 $217,835,330 (1) The decrease in contracts and grant awards in Fiscal Year 2012 and Fiscal Year 2013 was partially due to the Budget Control Act of 2011 cuts to federal programs ( sequestration ) to reduce federal spending to levels specified in the act. (Source: The University.) (The remainder of this page has been intentionally left blank.) 8

13 The following table sets forth the amounts of contracts and grants expenditures by source for each of the Fiscal Years indicated. Schedule of Contracts and Grants Expenditures Fiscal Year Federal sources: Department of Education... $ 55,637,201 $ 57,679,364 $ 56,534,531 $ 49,221,996 $ 56,833,671 Department of Defense... 54,785,682 51,955,597 47,633,519 49,730,407 48,919,888 Department of Health and Human Services... 17,296,624 14,275,603 13,649,596 19,000,394 17,528,910 Department of Agriculture... 16,260,374 15,014,369 19,812,216 17,391,102 17,429,453 National Aerospace and Space Administration... 15,451,781 8,724,345 7,423,997 3,442,018 5,594,870 National Science Foundation... 14,456,691 11,654,161 9,216,606 5,964,491 5,922,865 Other federal agencies... 13,749,462 17,088,078 17,588,209 26,548,089 23,091,105 Department of Interior... 3,727,497 3,626,160 3,766,989 4,285,607 4,491,896 Total federal agencies ,365, ,017, ,625, ,584, ,812,658 Other sources: Business and industry... 10,622,647 9,962,690 10,784,004 9,506,109 8,011,935 State... 7,263,790 6,996,087 7,776,494 7,671,989 12,469,223 Other non federal agencies... 6,557,307 7,900,581 8,272,601 7,889,183 7,803,269 Total non federal agencies... 24,443,744 24,859,358 26,833,099 27,067,281 28,284,427 Total expenditures all sources (1)... $215,809,056 $204,877,035 $202,458,762 $202,651,385 $208,097,085 (1) Dollar differences between the Schedule of Contracts and Grants Awards and the Schedule of Contracts and Grants Expenditures represent timing differences between the award and expenditure of funds. (Source: The University.) Management Discussion of Revenues Generally. Revenues from indirect cost recovery increased 46% during the 10 year period ending Fiscal Year During this time, the University has been successful in increasing its direct cost base and improving its recovery of indirect costs on contracts and grants. Despite federal budget challenges, the four divisions that comprise the Space Dynamics Lab are doing well. The C41SR division is experiencing continued growth through executing work won in previous years, upgrades of systems that are currently deployed and developing new tools for customers who need more economical and flexible ways to manage and exploit image data. The Civil Space division has continued to grow, mostly through added scope to existing programs. The Military Space division was significantly impacted by the cancellation of the PTSS program, but received approximately $12 million in funding in Fiscal Year Studies are underway to define the next generation of space systems for missile defense. The System Calibration and Test division has a strong outlook with the recent award of the NASA Radiation Budget Instrument calibration subcontract and a multi year role as test manager for a multi spacecraft military constellation. Indirect cost recovery is a function of three elements: (i) the negotiated facilities and administrative costs rate ( F&A rate ) used to allocate indirect costs to contracts and grants; (ii) the direct cost base to which the F&A rate is applied; and (iii) the success of the University in negotiating facilities and administrative costs recovery on each individual contract and grant. The University s F&A rate has remained fairly constant over the past five Fiscal Years, not fluctuating more than 3% in a given year. Under the indenture the University is pledging those revenues from 9

14 facilities and administrative costs recovery generated through contracts and grants held by the University (including the USU Research Foundation). Historical Revenues And Debt Service Coverage The following table shows the past 10 Fiscal Years historical Revenues, the debt service requirements for the Outstanding Parity Bonds, and the debt service coverage amounts. (The remainder of this page has been intentionally left blank.) 10

15 Summary of Contracts and Grants Expenditures and Historical Debt Service Coverage Utah State University For Fiscal Years Ending June 30 Actual Number Direct F&A Number Direct F&A Number Direct F&A Number Direct F&A Number Direct F&A of active Costs Ex- Costs of active Costs Ex- Costs of active Costs Ex- Costs of active Costs Ex- Costs of active Costs Ex- Costs contracts penditures Recovery contracts penditures Recovery contracts penditures Recovery contracts penditures Recovery contracts penditures Recovery Federal Department of Defense 158 $ 16,427,585 $ 5,942, $ 22,787,369 $ 6,688, $ 23,454,311 $ 6,996, $ 26,506,891 $ 9,044, $ 29,992,845 $ 10,426,694 National Aero. & Space Administration 83 24,464,272 6,199, ,029,150 4,503, ,483,608 3,343, ,482,772 3,323, ,675,411 1,899,910 Other federal agencies 103 4,265, , ,210,213 1,739, ,073,967 2,481, ,679,562 1,626, ,200,318 3,914,817 National Science Foundation 169 6,914,413 1,473, ,772,637 1,485, ,908,285 1,395, ,285,990 1,261, ,051,286 1,238,925 Department of HHS ,428,432 3,002, ,748,932 2,332, ,419,857 2,037, ,406,558 1,882, ,535,620 2,624,555 Department of Agriculture ,380, , ,283, , ,796, , ,594, , ,531, ,710 Department of Education 94 22,479, , ,824, , ,316, , ,060, , ,615, ,393 Department of Interior 126 3,410, , ,263, , ,280, , ,740, , ,099, ,178 Total federal 1, ,770,511 19,695,438 1, ,919,389 18,386,887 1, ,733,533 17,984,004 1, ,756,687 18,828,639 1, ,701,499 22,142,182 Other Business and industry 246 5,011, , ,495, , ,169,991 1,145, ,685,921 1,293, ,160,543 1,128,732 State 253 9,497, , ,643, , ,786, , ,273, , ,987, ,065 Other non federal agencies 257 5,994, , ,902, , ,715, , ,114, , ,716, ,142 Total other ,502,661 1,616, ,041,311 1,662, ,672,555 1,992, ,073,848 2,235, ,864,371 2,159,939 Totals federal and other 1,850 $ 131,273,172 $ 21,312,012 1,886 $ 128,960,700 $ 20,049,147 1,924 $ 131,406,088 $ 19,976,868 1,838 $ 127,830,535 $ 21,064,388 1,977 $ 147,565,870 $ 24,302,121 Debt service (research revenue bonds): 1995 Bonds $ 610,321 $ $ $ $ 2002A Bonds 1,810,638 2,420,156 2,413,972 2,414,329 2,415, Bonds 68,856 69,466 69,744 68,990 69, Bonds 103,326 1,040, Bonds Total debt service (1) $ 2,489,815 $ 2,489,622 $ 2,483,716 $ 2,586,645 $ 3,525,462 Debt service coverage 8.6X 8.1X 8.0X 8.1X 6.9X Actual Number Direct F&A Number Direct F&A Number Direct F&A Number Direct F&A Number Direct F&A of active Costs Ex- Costs of active Costs Ex- Costs of active Costs Ex- Costs of active Costs Ex- Costs of active Costs Ex- Costs contracts penditures Recovery contracts penditures Recovery contracts penditures Recovery contracts penditures Recovery contracts penditures Recovery Federal Department of Defense 117 $ 38,419,748 $ 10,500, $ 37,215,089 $ 12,515, $ 35,048,033 $ 12,585, $ 38,216,974 $ 13,738, $ 41,327,341 $ 13,458,341 National Aero. & Space Administration 81 4,401,175 1,193, ,508, , ,784,248 1,639, ,904,910 1,819, ,108,121 3,343,660 Other federal agencies ,201,356 4,889, ,739,812 5,808, ,687,235 3,900, ,562,969 3,525, ,548,566 3,200,896 National Science Foundation 115 4,627,883 1,294, ,477,527 1,486, ,252,157 1,964, ,172,105 2,482, ,565,482 2,891,209 Department of HHS ,112,696 3,415, ,330,409 2,669, ,395,151 2,254, ,867,534 2,408, ,503,672 2,792,952 Department of Agriculture ,705, , ,453, , ,459,486 1,352, ,995,508 1,018, ,127,230 1,133,144 Department of Education ,604,876 1,228, ,187,192 1,034, ,734,987 1,799, ,015,488 1,663, ,565,400 1,071,801 Department of Interior 166 3,828, , ,701, , ,279, , ,137, , ,198, ,264 Total Federal 1, ,901,159 23,911,226 1, ,613,365 25,970,739 1, ,640,723 25,984,940 1, ,872,817 27,144,860 1, ,944,045 28,421,267 Other Business and industry 253 6,781,238 1,230, ,848,598 1,657, ,776,032 2,007, ,103,125 1,859, ,626,521 1,996,126 State ,342,245 1,126, ,627,744 1,044, ,076, , ,546, , ,939, ,211 Other non federal agencies 257 7,495, , ,395, , ,796, , ,463, , ,263, ,523 Total other ,618,882 2,665, ,871,670 3,195, ,649,085 3,184, ,113,015 2,746, ,829,884 2,613,860 Totals federal and other 1,984 $ 181,520,041 $ 26,576,771 2,031 $ 173,485,035 $ 29,166,350 2,134 $ 173,289,808 $ 29,168,954 2,048 $ 174,985,832 $ 29,891,203 2,187 $ 184,773,929 $ 31,035,127 Debt service (research revenue bonds): 2002A Bonds $ 1,917,477 $ 1,880,598 $ 1,879,594 $ $ 2003 Bonds 69,013 68,800 69,415 68,872 69, Bonds 1,052,888 1,682,421 1,651,796 1,658,671 1,636, Bonds 490, , ,583 2,337,521 2,334, Bonds 2015B Bonds Total debt service (1) $ 3,529,405 $ 4,089,761 $ 4,062,388 $ 4,065,064 $ 4,039,848 Debt service coverage 7.5X 7.1X 7.2X 7.4X 7.7X (1) Total debt service includes principal and interest, on the accrual basis of accounting, as reported on the University s annual financial reports. (Source: The University.) 11

16 Outstanding Debt Of The University The University has the following debt outstanding. Original Current Principal Final Principal Series Purpose Amount Maturity Date Outstanding Research Bonds (1) 2015B (2)... Refunding $13,145,000 December 1, 2030 $ 13,145, (2) (3)... Building 19,500,000 December 1, ,500, (2) (3)... Refunding 11,070,000 December 1, ,500, (2) (4)... Building 22,000,000 December 1, 2018 (12) 2,725,000 Totals (5)... 39,870,000 Building Fee Bonds (6) 2015 (2) (3)... Building 23,900,000 June 1, ,900, B (2)... Building 43,310,000 December 1, ,635, (2)... Refunding 8,405,000 April 1, ,750,000 Totals (7)... 74,285,000 Housing Bonds (8) 2015 (2) (3)... Building 24,455,000 April 1, ,455, (2) (9)... Refunding 39,155,000 April 1, ,155,000 Totals (10)... 63,610,000 Total all outstanding debt (11)... $177,765,000 (1) The Research Bonds are issued on a parity basis with each other. (2) Rated AA by S&P, as of the date of this OFFICIAL STATEMENT. (3) These bonds are insured by AGM. (4) Principal portions of this bond will be refunded by the 2015B Bonds. (5) For accounting purposes, the total unamortized bond premium is $748,105 (as of June 30, 2015) and together with current debt outstanding of $38,870,000, results in total outstanding net debt of $40,618,105. (6) These Building Fee Bonds are issued on a parity basis with each other. (7) For accounting purposes, the total unamortized bond premium was $1,714,827 (as of June 30, 2015) and together with the current debt outstanding of $74,285,000, results in total outstanding net debt of $75,999,827. (8) These Housing Bonds are issued on a parity basis with each other. (9) These bonds are insured by National Public Finance Guarantee Corp. (10) For accounting purposes, the total unamortized bond premium is $2,778,702 (as of June 30, 2015) and together with current debt outstanding of $63,610,000, results in total outstanding net debt of $66,388,702. (11) For accounting purposes, the total unamortized bond premium is $5,241,634 (as of June 30, 2015) and together with current debt outstanding of $177,765,000, results in total outstanding net debt of $183,006,634. (12) Final maturity date and redemption date after a portion of these bonds has been refunded by the 2015B Research Bonds. For the University Fiscal Year 2015 debt information see APPENDIX B FINANCIAL REPORT OF UTAH STATE UNIVERSITY FOR FISCAL YEAR 2015 Notes to Financial Statements Note H. Bonds, Notes, Contracts and Other Non Current Liabilities Figure H.1. (page 39) and Note I. Pledged Bond Revenue (page 42). 12

17 Debt Service Schedule Of Outstanding Debt Of The University By Fiscal Year Fiscal Year Ending June 30 Research Bonds (1) Series 2015B Series 2015 Series 2010 Series 2009 Series 2003 (8) Total $13,145,000 $19,500,000 $11,070,000 $22,000,000 $705,000 Total Total Debt Principal Interest Principal Interest (6) Principal Interest Principal Interest Principal Interest Principal Interest (6) Service 2015 $ 0 $ 0 $ 0 $ 0 $ 2,105,000 $ 238,125 $ 800,000 $ 492,419 $ 65,000 $ 4,390 $ 2,970,000 $ 734,934 $ 3,704, , ,370 2,200, , , ,750 68,000 1,496 3,118, ,116 3,939, , ,636 2,200, , ,000 91,500 3,075,000 1,033,886 4,108, , , ,501 2,300,000 46, ,000 56,000 3,565, ,501 4,490, , , , ,000 19,000 1,320, ,465 2,157, , , , , (7) 1,255, ,728 2,066, , , , , (7) 1,305, ,427 2,108, , , , , (7) 1,360, ,898 2,153, ,005, , , , (7) 1,410, ,131 2,193, ,080, , , , (7) 1,500, ,045 2,271, ,105, , , , (7) 1,540, ,523 2,297, ,160, , , , (7) 1,610, ,464 2,352, ,235, , ,000 (2) 724, (7) 1,700, ,798 2,424, ,280, , ,000 (2) 704, (7) 1,765, ,891 2,469, ,335,000 96, ,000 (2) 684, (7) 1,840, ,145 2,524, ,080,000 60, ,000 (2) 662, (7) 1,610, ,457 2,272, ,105,000 22, ,000 (2) 639, (7) 1,655, ,825 2,294, ,000 (3) 615, , ,147 1,190, ,000 (3) 588, , ,269 1,188, ,000 (3) 560, , ,133 1,190, ,000 (3) 530, , ,624 1,190, ,000 (3) 499, , ,743 1,189, ,000 (4) 466, , ,831 1,191, ,000 (4) 431, , ,748 1,191, ,000 (4) 395, , ,011 1,190, ,000 (4) 356, , ,502 1,191, ,000 (5) 315, , ,994 1,190, ,000 (5) 273, , ,481 1,188, ,000 (5) 228, , ,950 1,188, ,010,000 (5) 182,163 1,010, ,163 1,192, ,055,000 (5) 133,119 1,055, ,119 1,188, ,110,000 (5) 81,700 1,110,000 81,700 1,191, ,165,000 (5) 27,669 1,165,000 27,669 1,192,669 Totals $ 13,145,000 $ 5,452,269 $ 19,500,000 $ 17,568,382 $ 8,805,000 $ 564,375 $ 4,375,000 $ 780,669 $ 133,000 $ 5,886 $ 45,958,000 $ 18,919,311 $ 64,877,311 (1) These Research Bonds are issued on a parity with each other. (2) Mandatory sinking fund principal payments from a $2,535,000, 4.191% term bond due December 1, (3) Mandatory sinking fund principal payments from a $3,155,000, 4.575% term bond due December 1, (4) Mandatory sinking fund principal payments from a $3,115,000, 4.725% term bond due December 1, (5) Mandatory sinking fund principal payments from a $7,090,000, 4.750% term bond due December 1, (6) Total interest payments do not include any capitalized interest to be paid from the proceeds of the 2015 Bonds. (7) Principal and interest have been refunded by the 2015B Bonds. (8) This bond issue has been included in this table because final principal and interest payment occurred in Fiscal Year

18 Debt Service Schedule Of Outstanding Debt Of The University By Fiscal Year continued Building Fee Bonds (1) Fiscal Year Series 2015 Series 2013B Series 2013 Total Ending $23,900,000 $43,310,000 $8,405,000 Total Total Debt June 30 Principal Interest Principal Interest Principal Interest Principal Interest (7) Service 2015 $ 0 $ 0 $ 0 $ 1,987,300 $ 565,000 $ 252,438 $ 565,000 $ 2,239,738 $ 2,804, , ,000 1,977, , ,488 1,265,000 3,048,415 4,313, , , ,000 1,955, , ,788 1,785,000 3,107,969 4,892, , , ,000 1,932, , ,638 1,840,000 3,054,044 4,894, , , ,000 1,905, , ,888 1,910,000 2,990,069 4,900, , , ,000 1,872, , ,888 1,980,000 2,913,069 4,893, , , ,000 1,838, , ,888 2,070,000 2,828,319 4,898, , , ,000 1,803, ,000 99,888 2,160,000 2,739,919 4,899, , , ,000 1,766, ,000 70,488 2,255,000 2,647,469 4,902, , , ,000 1,728, ,000 55,188 2,335,000 2,566,369 4,901, , ,981 1,020,000 1,688, ,000 38,613 2,435,000 2,480,894 4,915, , ,481 1,065,000 1,641, ,000 20,500 2,525,000 2,385,256 4,910, , ,281 1,120,000 1,586,650 1,780,000 2,290,931 4,070, , ,481 1,175,000 1,529,275 1,855,000 2,213,756 4,068, , ,231 1,230,000 1,475,300 1,930,000 2,138,531 4,068, , ,481 1,285,000 1,418,575 2,005,000 2,059,056 4,064, , ,181 1,355,000 1,352,575 2,100,000 1,968,756 4,068, , ,038 1,425,000 1,283,075 2,195,000 1,874,113 4,069, , ,088 1,495,000 1,210,075 2,295,000 1,774,163 4,069, , ,088 1,570,000 1,137,375 2,395,000 1,673,463 4,068, , ,181 1,645,000 (4) 1,065,038 2,500,000 1,571,219 4,071, , ,188 1,720,000 (4) 989,325 2,605,000 1,464,513 4,069, ,000 (2) 442,000 1,795,000 (4) 910,238 2,715,000 1,352,238 4,067, ,000 (2) 405,200 1,880,000 (4) 827,550 2,840,000 1,232,750 4,072, ,000 (2) 366,800 1,970,000 (5) 738,463 2,965,000 1,105,263 4,070, ,035,000 (2) 327,000 2,065,000 (5) 642,631 3,100, ,631 4,069, ,075,000 (2) 285,600 2,165,000 (5) 542,169 3,240, ,769 4,067, ,120,000 (3) 242,600 2,270,000 (6) 434,000 3,390, ,600 4,066, ,165,000 (3) 197,800 2,390,000 (6) 317,500 3,555, ,300 4,070, ,210,000 (3) 151,200 2,515,000 (6) 194,875 3,725, ,075 4,071, ,260,000 (3) 102,800 2,640,000 (6) 66,000 3,900, ,800 4,068, ,310,000 (3) 52,400 1,310,000 52,400 1,362,400 Totals $ 23,900,000 $ 17,805,002 $ 43,310,000 $ 39,818,163 $ 8,315,000 $ 1,653,688 $ 75,525,000 $ 59,276,852 $ 134,801,852 (1) (2) These Building Fee Bonds are issued on a parity with each other. Mandatory sinking fund principal amounts from a $4,985,000, 4.00% term bond due June 1, (3) Mandatory sinking fund principal amounts from a $6,065,000, 4.00% term bond due June 1, (4) Mandatory sinking fund principal amounts from a $7,040,000, 4.50% term bond due December 1, (5) Mandatory sinking fund principal amounts from a $6,200,000, 4.75% term bond due December 1, (6) Mandatory sinking fund principal amounts from a $9,815,000, 5.00% term bond due December 1, (7) Total interest payments do not include any capitalized interest from the proceeds of the 2015 Building Fee Bonds and the 2013B Building Fee Bonds bond issues. 14

19 Debt Service Schedule Of Outstanding Debt Of The University By Fiscal Year continued Housing Bonds (1) Fiscal Year Series 2015 Series 2009 (3) Series 2007 Total Ending $24,455,000 $8,130,000 $39,155,000 Total Total Debt June 30 Principal Interest (2) Principal Interest Principal Interest Principal Interest (2) Service 2015 $ 0 0 $ 1,700, $ 0 $ 1,952,013 $ 1,700,000 $ 1,977,513 $ 3,677, ,857 1,200,000 1,952,013 1,200,000 2,413,869 3,613, ,406 1,250,000 1,904,013 1,250,000 2,788,419 4,038, , ,406 1,295,000 1,842,513 2,085,000 2,726,919 4,811, , ,706 1,365,000 1,778,613 2,180,000 2,639,319 4,819, , ,256 1,435,000 1,710,363 2,275,000 2,546,619 4,821, , ,656 1,505,000 1,638,613 2,380,000 2,441,269 4,821, , ,656 1,575,000 1,563,363 (4) 2,485,000 2,331,019 4,816, , ,156 1,670,000 1,480,675 (4) 2,625,000 2,202,831 4,827, , ,506 1,745,000 1,393,000 2,730,000 2,086,506 4,816, ,030, ,256 1,835,000 1,305,750 2,865,000 1,950,006 4,815, ,060, ,506 1,930,000 1,214,000 2,990,000 1,832,506 4,822, ,110, ,506 2,025,000 1,117,500 (5) 3,135,000 1,683,006 4,818, ,165, ,006 2,120,000 1,016,250 (5) 3,285,000 1,526,256 4,811, ,200, ,056 2,240, ,250 (6) 3,440,000 1,385,306 4,825, ,240, ,056 2,365, ,250 (6) 3,605,000 1,237,306 4,842, ,275, ,856 2,460, ,000 (7) 3,735,000 1,081,856 4,816, ,315, ,013 2,580, ,000 (7) 3,895, ,013 4,814, ,355, ,275 2,725, ,000 (7) 4,080, ,275 4,827, ,405, ,544 2,845, ,750 (7) 4,250, ,294 4,815, ,450, ,369 2,990, ,500 (7) 4,440, ,869 4,813, ,505, ,619 1,505, ,619 1,678, ,560, ,063 1,560, ,063 1,679, ,615,000 60,563 1,615,000 60,563 1,675,563 Totals $ 24,455,000 $ 12,100,294 $ 1,700,000 $ 25,500 $ 39,155,000 $ 25,683,425 $ 65,310,000 $ 37,809,219 $ 103,119,219 (1) These Housing Bonds are issued on a parity with each other. (2) Total interest payments do not include any capitalized interest to be paid from the proceeds of the 2015 Housing Bonds. (3) (4) This bond issue is included in the table because final principal and interest payments occurred in Fiscal Year Mandatory sinking fund principal amounts from a $3,245,000, 5.25% term bond due April 1, (5) Mandatory sinking fund principal amounts from a $4,145,000, 5.00% term bond due April 1, (6) Mandatory sinking fund principal amounts from a $4,605,000, 5.00% term bond due April 1, (7) Mandatory sinking fund principal amounts from a $13,600,000, 5.00% term bond due April 1,

20 Financial Summaries The financial statements reflect the financial reporting standards as outlined by the Governmental Accounting Standards Board. The financial statements are prepared with a focus on the financial condition of the University, the results of operations, and cash flows of the University as a whole. The following comparative summaries are unaudited. (The remainder of this page has been intentionally left blank.) 16

21 Utah State University Statement of Net Position (This summary has not been audited) As of June Assets Current assets: Cash and cash equivalents $ 81,995,711 $ 57,195,235 $ 37,254,827 $ 32,722,248 $ 30,766,362 Short term investments 44,041,040 25,505,138 80,949,500 58,131,205 8,309,605 Accounts receivable net of allowances.. 55,904,644 52,508,633 55,551,882 57,759,082 75,315,326 Credits receivable.. 572, , , ,635 1,024,756 Notes receivable net of allowances.. 1,361,874 1,321,185 1,146,866 1,341,338 1,302,342 Inventories.. 4,197,562 4,871,672 4,604,882 5,125,751 4,851,548 Prepaid expenses.. 4,125,275 2,195,104 3,479,349 1,974,189 2,255,058 Total current assets 192,198, ,025, ,317, ,339, ,824,997 Non current assets: Restricted: Cash and cash equivalents. 3,134,141 1,707,051 2,262,278 2,045,220 2,462,882 Short term investments. 2,410,879 1,421,228 5,421,325 4,064, ,710 Investments. 158,295, ,908, ,229, ,779, ,537,160 Accounts receivable. 25,913,130 28,248,178 21,453,837 16,894,025 1,742,397 Notes receivable.. 61,533 64,543 67,409 69,960 Real estate held for resale. 445,520 1,917,520 1,070, , ,520 Accounts receivable. 13,824,199 17,943,000 11,646,238 17,391,147 29,519,958 Notes receivable.. 10,337,642 11,192,329 11,305,549 10,789,545 10,956,795 Investments. 256,876, ,105, ,479, ,992, ,065,065 Other noncurrent assets. 131, , , ,754 68,188 Net pension assets. 46,288 Property, plant and equipment net. 709,458, ,471, ,177, ,817, ,138,619 Total non current assets 1,180,935,097 1,168,200,987 1,038,218,332 1,021,605, ,003,294 Total assets 1,373,133,609 1,312,226,435 1,221,535,352 1,178,944,497 1,060,828,291 Deferred outflows of resources: Unamortized refunding losses on bonds 2,036,600 2,286,574 2,543,035 2,282,648 2,608,792 Resources related to pensions. 5,826,112 Total deferred outflows of resources.. 7,862,712 2,286,574 2,543,035 2,282,648 2,608,792 Liabilities: Current liabilities: Accounts payable and accrued liabilities 51,109,259 48,940,392 47,698,739 45,879,439 Accounts payable and accrued liabilities to primary government 16,858,029 Accounts payable and accrued liabilities to others 48,413,887 Liability for compensated absences 11,837,156 11,598,822 11,129,300 10,222,918 10,269,606 Liability for early retirement 4,444,441 5,272,590 6,159,695 5,564,230 5,013,442 Unearned revenue and deposits 23,246,052 17,976,221 17,152,993 16,946,664 19,951,944 Other current liabilities 183,334 Funds held for others 57,245 1,021, , , ,808 Notes payable to primary government 146,557 Bonds, notes, and contracts payable 8,673,131 8,818,697 8,432,800 7,554,331 7,446,008 Total current liabilities 113,859,832 95,796,599 92,531,119 88,617,539 89,227,247 Non current liabilities: Liability for compensated absences 5,662,414 5,347,141 5,565,319 6,189,855 6,004,848 Liability for early retirement 7,076,988 8,515,026 8,914,511 10,005,742 9,678,124 Notes payable to primary government 288,825 Deposit due to primary government 465,000 Unearned revenues and deposits and other 1,805,215 1,008,965 1,087,108 1,161,889 Other non current liabilities 1,156,880 Net pension liability... 37,273,380 Bonds, notes, and contracts payable 130,800, ,996, ,127, ,205, ,654,223 Total non current liabilities 182,724, ,664, ,615, ,488, ,499,084 Total liabilities 296,584, ,460, ,147, ,105, ,726,331 Deferred inflows of resources: Resources related to pensions. 3,548,725 Total deferred outflows of resources.. 3,548,725 Net position: Invested in capital assets net of debt 585,148, ,997, ,617, ,057, ,776,010 Restricted for: Non expendable: Primary scholarships and fellowships.. 110,991, ,102, ,657,358 93,294,196 87,420,367 Loans.. 13,163,145 13,119,699 14,518,504 13,854,486 13,918,031 Expendable: Research, instruction and public service ,173, ,228, ,781, ,559, ,258,809 Capital projects 57,549,252 61,168,626 34,390,492 30,858,330 41,445,717 Unrestricted ,838, ,435, ,423, ,214, ,283,026 Total net position.. $ 1,080,863,582 $ 1,063,052,211 $ 1,013,388,321 $ 968,838,934 $ 838,101,960 (Source: The University.) 17