Notesto Financial Statements Note 2. Deposits June 30.2005_part2 docx

Notes to
Financial
Statements
June 30
2005
Future
minimum
lease payments
for
the
above assets
under capital
leases
together
with
the
present
value
of the
minimum lease
payments
at June 30, 2005,
ile
as
follows:
Year Ending
June 30
2006
2007
2008
2009

Total
minimum lease payments
Less
amount representing
interest
Net
present
value
Total
$
251,704
235,991
211,979
132,188
831,862
(54,353)
$
777,509
OPERATING
LEASES
The
University has
entered
into
agreements
to
lease
recreational
space
and

office space that the University
is treating as
operating
leases.
Rent
expense for
the
years
ended
June
30,
2005 and2004 was
$442,413
and$354,266, respectively.
The
leases
expire
between July 2005
and
May
2012.
Following is a
schedule of
future minimum
lease
payments.
Year Ending
June
30
2006

2007
2008
2009
2010
20ll-2012
Total
Building
285,515
59,407
59,407
59,407
59,407
113,866
_637,9q2_
In 1990, the Foundation
established
a Chicago
office
to
provide
the
University
with direct access to Chicago area
alumni,
corporation,
and Foundation
networks.
Lease
payments
for

the Chicago office were
$58,867
in 2005 and
$61,684
in 2004.
The current lease
has been
amended
to expire on December
31,
2014. tn
addition,
the Foundation
leases
a vehicle for
the Executive
Director
of the
Foundation
and ten
vehicles
for the
University
Athletic Department
employees at a cost
of
$55,986
in
2005
and

$45,661
in 2004. The lease
for the Executive Director expires in the fiscal
year
ending
June
30, 2006.
Nine
of the leases
for the
Athletic Department
vehicles expire in the
fiscal
year
ending
June
30,
2009,
with
one
lease
expiring
in
the fiscal
year
ending June
30,2007.
The
following
is a schedule

of
future
minimum
lease
payments
for
both.
Year
Ending
June 30
2406
2007
2008
2009
2010
20tl-20r5
Total
Building
70,643
72,051
73,458
74,865
76,273
360,470
727,760
Vehicles
$
41,385
37,I8l
34,639

6,094
s
___1_19,298
ILLINOIS
STATE
UNIVERSITY
32
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Notes to Financial
Statements June
30
2005
Note 11.
State Universities
Retirement
System
(SURS)
Plsn
Description.' Illinois
State University
contributes to
the
State
Universities
Retirement
System of Illinois
(SURS),
a cost-sharing
multiple-employer

defined
benefit
pension
plan
with
a
special funding situation
whereby
the
State
of
Illinois
makes
substantially
all
actuarially determined required conffibutions on behalf
of the
participating
employers.
SURS was established
July 2 l,
l94l
to
provide
retirement annuities and
other benefits
for staff members
and
employees of
the state

universities, certain
affiliated organizations,
and
certain
other
state
educational and
scientific
agencies and for
survivors,
dependents,
and
other
beneficiaries of such employees. SURS
is
considered
a
component
unit
of the
State
of Illinois'
financial reporting
entity and is included in the State's
financial reports as a
pension
trust
fund.
SURS is
governed

by
Section
5/15, Chapter 40, of
the
Illinois Compiled Statutes.
SURS
issues
a
publicly
available financial
report
that includes
financial
statements and
required supplementary
information.
That
report may
be
obtained by
writing
to SURS, l90l Fox Drive,
Champaign,
IL
61820
or
by
calling
l
-800-275

-7877
.
Funding Policy:
Plan
members
are
required
to contribute 8.0%
of
their
annual covered
salary and
substantially all
employer contributions
are
made
by the State of Illinois
on behalf of
the
individual employers
at an
actuarially
determined
rate. The
cunent rate is I
l.l2o/o
of annual covered
payroll.
The
contribution

requirements
of
plan
members
and
employers
are
established
and
may
be amended
by the Illinois General
Assembly.
The employer
contributions
to
SURS
for the
years
ending June
30,
2005,2004, and
2003, were
$1
1,889,799,575,566,368,
and
$12,412,437,
respectively,
equal to the required
contributions

for each
year.
On April 7,2003, the
Governor signed Public
Act 93-0002
into law
authorizing
the issuance of
up to
$10
billion of
general
obligation
bonds for making contributions
to the State's
designated retirement
systems,
including the
SURS.
On June
12,2003,
the
State
issued
$10
billion of General Obligation Bonds,
Pension
Funding
Series
of

June
2003,
which
generated
$9.96
billion in
proceeds
in order to
pay
the designated
retirement systems'
$300
million for
the
remaining statutorily
required
contributions
for
the
fourth
quarter
of fiscal
year
2003,
S1.86
billion
for
the
fiscal
year

2004
statutorily required
contributions,
and
$7.32
billion
in order
to
reduce
the
actuarial
reserve deficiencies
of the
State's designated retirement
systems. The
remaining
$481
million of
proceeds was
authorized
by the
Bond Sale Order
to
be
held by
the State
to
make
the first required interest
payment

on
the bonds.
On July
1,2003, the SURS
received
an
allocation of
$1,43
billion
of
their share of the
$7
.32 billion to reduce
the actuarial
reserve
deficiency
at the SURS.
The Universities' allocation of
this amount was
$75
million.
Note 12.
Post-employment Benefits
In
addition
to
providing pension
benefits, the State
provides
certain

health, dental
and
life
insurance
benefits to
annuitants who are former
State employees.
This includes
annuitants
of
the University.
Substantially
all State
employees including
the University's employees may become
eligible
for
post-employment
benefits
if they eventually
become annuitants.
Health and
dental
benefits include basic benefits
for
annuitants under
the State
self-insurance
plan
and insurance

contracts currently in
force.
Life insurance benefits
for annuitants
under
age 60 are
equal to
their annual
salary at
the
time of
retirement;
life insurance benefits
for
annuitants
age 60 and
older are
limited to
five
thousand
dollars
per
annuitant.
Currently, the
State does
not
segregate
payments
made to
annuitants

from
those
made to
curent employees
for
health,
dental, and
life
insurance
benefits. The
cost
of health, dental and life
insurance
benefits
is
recognized on
a
pay-as-you-
go
basis.
These
costs are funded by the
State
and
are
not
an
obligation
of the University.
ILLINOIS STATE

UNIVERSITY
33
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Notes to Financial
Statements
June 30
200s
Note 13. Transactions
with Related Organnations
Illinois State
University Foundation
(The
Foundation) is
a related
organization
formed to support
in
various
ways the
University's
instructional,
research,
and
public
service missions. During fiscal
years
2005 and}0}4,Illinois
State
University entered into

contractual
agreements with the Foundation requiring
payments
of
$260,000
annually
for
fund
raising
services.
During
fiscal
year
2005 and2004,
the
Foundation
contributed
services
and expenditures
of
$12,078,305
and
$7,973,005,
respectively that were for
the direct and/or
indirect
support of the University.
These
ffansactions
have

not
been eliminated
from the
f,rnancial
statements of the University
or the
Foundation.
The
Illinois
Institute
for
Entrepreneurship Education
(IIEE)
was
created
by
an act
of
the
Illinois
General
Assembly
in
1988.
The
purpose
of the IIEE is
to
foster
growth

and development of entrepreneurship
by educating
Illinois citizens
to
the
viability
of entrepreneurship
as a career option and to the role and contributions
of entrepreneurs
in economic
development and
job
creation. The IIEE
is
mandated to reach
all areas of
the
State,
all ages, all ethnic
groups,
and
income
levels.
The
IIEE was
created
under
the oversight of Illinois State University
and, by
working cooperatively

with
the University,
the IIEE
offers Illinois teachers two university-accredited
graduate
courses
in
entrepreneurship.
During fiscal
years
2005
and2004,the
University
contributed
$188,724
and
$192,135,
respectively, of
revenue and
public
service
expenditures
to the
IIEE. These
amounts are discretely
blended in
the University
financial
statements.
Note

14.
Student
Health
Insurance
The University
contracts
with Chickering Group, an
Aetna
Company
of
Cambridge,
Massachusetts
for
administration
of the
Aetna
Health
and Accident
Insurance
Plan, to
provide group
insurance benefits
to University
students. Students
taking
9 or more semester
hours
of class
pay
a

fee for
this coverage.
The contract
provides
for a
premium
stabilization
reserve
(PSR)
that
is
used to minimize increases in the
premium
and to be used against
unexpected
claims utilization
to
reduce
future
premium
increases.
As each
Plan
year
is
finalized,
costs are debited
(gains
are credited)
to an account

funded
by the
University
each
year
(15%
of expected
premium).
The
estimated
refund
for 2003-04 approximates
$315,242.
The initial
retund
of
$252,194
was rolled
over to
tund 2004-05
($67,757)
and
2005-06
($184,437);
a
final
refund of
$63,048
is
expected

in November 2005. Because
potential
refunds are
still at
risk for unexpected
claims
losses,
they are not
recorded
as
assets.
The
PSR
fund
held
by the University
as of
September
2005 is
$926,594,
same
as
prior
year.
The
amount required
to fund
the PSR for 2005-06 is
$750,000.
In

addition
to the
2003-04 refunds
($
184,437)
which
have
been committed to fund
2005-06,
another
$565,563
will
be
required
from
the
PSR before
December 31, 2005.
Note
15.
Student Financial
Assistance
The
University
participates
in the U.S. Department of
Education Direct Student
Loan
Program.
The University

awarded
$58,385,787
and
$55,686,070
in Direct Student
Loans for the
years
ended
June
30,
2005 and2004,
respectively.
The
University
classified
this
loan
program
as
noncash federal awards,
and it
is
disclosed
in the footnotes
to the Office of Management
and Budget
(OMB)
Circular A-133
Schedule
of Expenditures

of Federal
Awards.
Accordingly, no revenue
or
expenditures
are
included in
the financial statements
of the
University.
ILLINOIS STATE
UNIVBRSITY
34
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Notes
to
Financial
Statements
June 30
2005
Note
16. Self-Insurance
The University
is exposed
to
various risks
of loss
related
to torts,

theft
of,
damages to, and
destruction of assets;
effors
and omissions; injuries
to
employees; and natural disasters.
The
University
purchases
commercial
insurance for these
risks
of
loss. During
the
year
ended June 30,
2005,
there
were no significant
reductions in coverage.
As a
public
University
in the State of Illinois,
Illinois State University
enjoys certain statutory
protections

from liability
through the
Illinois
Court
of Claims statute
and the State
Indemnification Act. In
addition,
the
University
purchases
an
excess liability
policy
that covers claims above
the
$350,000
deductible
level
and
has
annual
aggregate levels of
$5,000,000
for
educator's
legal liability
and
$6,000,000
for

general
liability.
To
augment existing
state
and commercial
coverage, and to assist in addressing
potential
risks
and liabilities incurred
through
its
operations,
the
Board
of Trustees
has established the Self-Insurance
Fund. The
balance in the fund
at June
30, 2005 and2004 was
$952,135
and
$940,834,
respectively. The University
paid
one claim
of
$4,250
for fiscal

year
2005
and
did not
pay
any claims
for
fiscal
year
2004. The University made contributions
of
interest to the fund
of
$14,232
for fiscal
year
2005
and
$7,053
for
fiscal
year
2004. In
accordance
with
the requirement
of GASB
Statement
No.
10, a liability for

claims
is
reported
if information
prior
to the
issuance of the
financial
statements indicates
that it
is
probable
that
a liabilify
has
been
incurred
at the date of the financial
statements
and the
amount of
loss can be
reasonably
estimated.
At June 30, 2005
and June
30,2004,
no liability was
reported.
Note 17. Net

Assets
UNIVERSITY
NET ASSETS
University
restricted
net
assets are comprised
of the
following
at June 30,
2005 and2004:
2005
2004
Expendable
Capital
projects
Debt retirement
Student loans
Total Expendable
University unrestricted
net
assets:
$
_J2]8,43:_
$
_r7,6rw2_
Board
designated capital
asset renewal and replacement for
the

internal service
departments
at June 30,
2005 and2004
was
$838,226
and
$963,026,
respectively. These
amounts
are
included
in
unrestricted
net assets.
FOT]NDATION
NET ASSETS
Foundation restricted
net
assets
are comprised
of the
following
at June 30,
2005 and20A4:
2005
2004
Nonexpendable
Scholarship and fellowship
College

and
academic
department
support
Faculty
and
staff
compensation
Other
Total
nonexpendable
$
2,176,869
675,438
9,331,128
$
7,570,000
675,438
9,372,694
22,526,597
$
20,465,634
8,557,271
7
,047,408
5,787,717
4,428,187
4,153,676
2,527,679
41,025,261

$
34,468,908
ILLINOIS
STATE
UNIVERSITY
35
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Notes
to
Financial
Statements
June
30
2005
Expendable
Scholarship
and fellowship
Instructional
departmental
uses
University
capital
proj
ects
Other restricted
expendable
Total
expendable
$

7,238,687
$
10,749,824
4,522,812
1,800,485
6,070,016
11,769,401
10,445,610
1,823,590
$
_?1,31_1,8q9_
$
__19,108,612_
During fiscal
year
2005, Foundation
management identified
an
account classification
error
that occurred
in
a
previous
year.
It was determined
that an
account
previously
identified

as an endowment
actually
did not contain
a
stipulation
that the
principal
remain in
perpetuity.
Therefore,
on
its
June 30,2004
Statement of
Net
Assets,
the
Foundation
reclassified
$3,957,635
previously
reported as Net
Assets:
Restrictedfor:
Nonexpendable
Scholarships
andfellowships
to Net
Assets:
Restrictedfor:

Expendable
Scholarships
andfellowships.
The same amount
was reclassified
from
En dowm
ent inv es tm
ent s
to Res
tr i ct e d inv e s
t
m
ent s
.
Note
18.
Foundation
Restricted
Endowments
If a donor has not
provided
specific instructions,
state
law
permits
the Foundation to
authorize
for expenditure
the

net
appreciation
(realized
and unrealized) of the investments
of
endowment funds.
The
Foundation
Investment Committee
adopted a spending
policy
for
fiscal
years
2005 and2004 of
4.0%o and 0.070,
respectively, of the average
fair
value of
endowment investments
for the
preceding
12 months.
At June
30,
2005
and 2004, net
appreciation of
$7,281,000
and

$7,100,000,
respectively,
remains available
for
future
authorization
for
expenditure
by
the Investment
Committee.
This amount
is included
in the Net
Assets
section of the
Statements of Net
Assets as Restricted
for
Nonexpendable.
Note 19. Commitments
During 2005,
the
Universify entered into two real estate
deposit
and option
agreements.
The
agreements
grant

the
University an irrevocable
seven
year
option
period
to
purchase
the
properties.
The agreements
provide
that the option
periods
may
be
renewed
for up
to two
additional
periods
of seven
years.
The University
has
made
non-refundable
option deposit
payments
of

$500,250
which
can
be credited toward
the
purchase price. If the
University
exercises
the
option
agreements, the
purchase price
for
the
properties
will be
53,335,000.
The
agreements
also
require
annual
maintenance fees
which will not
be
credited
toward
the
purchase
price.

The
University
has
entered
into
contracts
for
significant
repairs
and
replacement
of University
capital
assets.
Total
estimated costs under
these contracts are
$10,649,545,
approximately
82,624,975
(25 percent)
of
the
work has been
completed as of June
30,
2005.
The University is obligated to
pay
the

remainder
of the
costs under
the
contracts as
the
work is
completed.
During
2003,
the
State of
Illinois released
funding
for
Schroeder
Hall rehabilitation.
The estimated
project
cost
is
$18,700,000
and
will
be funded
through
the
State
of Illinois
Capital

Development
Board.
Total estimated
construction
costs
incurred
at
June 30,
2005
were
$12,312,189.
During 2005,the University
placed into
service
a completed
section of the
project
at a
capitalized cost
of
$9,808,296.
ILLINOIS STATE
UNIVBRSITY
36
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Notes
to Financial
Statements
June

30 2005
Note 20.
Contingencies
The
University
is
from time
to time
subject
to various
claims, legal actions, and inquiries
related
to compliance
with
environmental
and
other
governmental
laws
and
regulations.
Although it is
diffrcult to
quantiff
the
potential
impact
of
these
claims,

management
believes
that the
ultimate cost
of these matters will not adversely affect
the
University's
future
financial
condition
or results
of operations.
Accordingly,
management
does not
believe
that a reserve
of the future effect, if any, of these
matters on the financial
condition
or results
of operations
of the
University is necessary
at June 30,2005, as it is
not
possible
to determine with
any degree
of

probability
the level
of future
expenditures
for these matters.
Note 21.
Reclassification
of
Fiscal
Year
2004 Revenue
and
Expense
During
fiscal year
2005,
University management
changed
the manner of
presentation
of certain
tuition and fee waivers.
Consequently,
on its
Statement
of Revenues, Expenses,
and Changes in Net Assets
for
the
year

ended June 30,2004,
the University
reduced
its
revenue
(Tuition
revenues
and
fees)
and its expenses
(Student
aid) by
$5,134,000.
This
reclassification
had
no
effect on the
change in net
assets. The related
amounts on
Notes I and 22 were
revised
to
refl ect
this reclassification.
ILLINOIS
STATE
UNIVERSITY
37

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Notes to
Financial
Statements
June
30
2005
Note 22.
Crosswalk
of
Natural
Classification
with Functional Classifications
Natural
Classification
for the
Year Ended June
30,
2005
Compensation
Supplies
and Benefits
and
Services Total
University
Instruction
Research
Public
Service

Academic
Support
Student Services
Institutional
Support
Operation of
Plant
Depreciation
Staff Benefits
Student Aid
Payments
on Behalf
Auxiliary Facilities
Other*
Total
Universitv
University
Instruction
S
Research
Public
Service
Academic
Support
Student
Services
Institutional
Support
Operation of
Plant

Depreciation
Staff Benefits
Student Aid
Payments
on
Behalf
Auxiliary
Facilities
Other*
78,427,891
$
9,766,596
5,666,147
8,398,359
12,629,313
11,430,354
8,398,943
1,783,893
3,084,600
42,893,414
17,984,440
24,756,395
2,693,254
(969,734)
$
_200,062J91_
$_*
8:,63%_19!_
Scholarships
Depreciation

$s
44,970
13,553,122
18,057
14,090,685
$
14,153,712
$
10,842,401
3,344,494
6,346,299
1,603,671
12,929,909
I1,685,400
12,415,793
89,270,282
l3,l I1,090
12,057,416
10,002,030
25,559,122
23,115,754
20,414,726
13,553,122
l,g0l,g40
17,175,285
42,993,414
42,740,925
1,713,520
_:13408,526____l_3,551,122_
S

*
The negative
amounts in the
Other function line above
are caused by
an
internal
budgeting m€chanism used to
allocate
certain internal service department charges.
Natural
Classification
for
the Year Ended
June 30.
2004
Compensation
and Benefits
Supplies
and Services
76,995,202
$
9,507,784
5,398,936
8,222,705
72,258,659
10,386,520
6,091,554
653,339
2,752,500

102,777,101
19,162,961
24,419,664
3,063,644
(1,324,623)
Scholarships
Depreciation
$$
1,2,340,446
34,639
12,956,516
$
89,875,267
12,611,969
10,497,928
9,710,201
23,930,799
21,971,127
19,334,923
12,340,446
697,977
15,709,016
102,777,107
42,592,625
1,739,021
Total
12,880,065
3,104,084
5,098,992
1,487,496

r1,672,130
11,584,607
12,243,269
Total
Universitv
$
253,518,403
83,918,194
$
12,991,155
$
12,340,446
$
362,769,199
*
The negative
amounts in
the
Other
function
line above
are caused by
an internal
budgeting mechanism used to
allocate certain internal service department charges.
ILLINOIS
STATE
UNIVERSITY
38
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Notes to
Financial
Statements
June
30. 2005
Note 23. Segment
Information
A segment
is
an identifiable
activity reported
as a stand-alone entify
for which
one
or
more revenue
bonds
are
outstanding. A segment
has a specific identifiable revenue
stream
pledged
in
support
of revenue bonds
and
has related
expenses,
gains

and losses,
assets, and
liabilities
that
are required by an
external
parfy
to be accounted
for separately.
The University
has one
segment
that
meets
the
reporting
requirements
of
GASB
Statement
No.
35. The
University
operates auxiliary facilities
that include student
housing,
student
activities
and
parking.

Following
are condensed
financial statements for
the
Auxiliary
Facilities System
segment:
2004
Condensed Statements of
Net Assets at June 30
Assets:
Current assets
Noncurrent assets:
Capital
assets, net
Other noncurrent
assets
Total
assets
Liabilities:
Current
liabilities
Noncurrent liabilities
Total liabilities
Net assets:
Invested in capital
assets, net
of related debt
Expendable
Unrestricted

Total net assets
Condensed Statements of Revenues, Expenses and
Changes
in Net
Assets
for
the
year
ended at June 30
Operating revenues
Depreciation
expense
Other operating
expenses
Operating income
Nonoperating
revenues
Nonoperating expenses
Increase in net assets
Net
assets
-
beginning of
year
Net
assets
-
end of
vear
Condensed Statements

of
Cash
Flows for
the
year
ended
June
30
Net cash flows
provided
by
(used
in)
operating
activities
Net cash flows
provided
by
(used
in) non-capital
financing activities
Net cash flows
provided
by
(used
in)
capital and
related
financing
activities

Net
cash flows
provided
by
(used
in)
investing activities
Net
increase
(decrease)
in
cash
and
cash
equivalents
Cash
and cash equivalents, beginning
of
year
Cash and cash equivalents, end
of
year
2005
s
37,760,727
s
84,978,218
19,601,3 I
I
142,340,253

11,939,268
49,752,340
18,452,006
80,157,589
34,957,560
133,567,155
10,358,382
53,106,804
63,465,186
61,691,608
34,175,155
2,852,307
43,621,186
___qqgqgq_
31,668,817
8,245,438
30,187,714
$
70,101,969
:
57,752,634
(3,347,444)
(42,740,825)
11,664,765
1,724,530
_
(2.842,616)
10,546,679
70,101,969
__gq'61!,61q_

15,719,399
203,301
(l3,6l0,lol)
2,421,709
4,734,308
7,012,918
11,747,226
$
58,447,697
(3,338,701)
(42,582,625)
12,526,371
478,648
(3,016,509)
9,988,510
60,113,459
$
__zgJglfg2_
16,276,556
184,575
(10,365,826)
(13,126,391)
(7,031,086)
14,444,004
7,012,918
ILLINOIS STATE UNIVBRSITY
39
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Notes to Financial

Statements June
30.2005
Following
is
additional
segment
disclosure
information
relating to University
Auxiliary Facilities
revenue bonds. See
Note 9:
RESERVES
FOR
DEBT
SERVICE, REPAIR AND REPLACEMENT,
AND DEVELOPMENT
Debt Service
A
portion
of
the Debt
Service Reserve Account
(DSRA)
that
was
established
under
the terms of the
Revenue

Bond Series
1989,
1992,1993 and 1996
indentures was
used
to
purchase
a Surety
Bond. This
Surety Bond
constitutes
a
Reserve
Account
Credit
Instrument
under the
requirements of
the
Bond
Resolution.
The Surety
Bond
is
payable
to the Bond Registrar. The
proceeds
of the
Surety
Bond held

in the DSRA may
be used
solely
for the
purpose
of
paying principal
and interest on the Series
1989, 1992,1993 and
1996
Bonds and any
outstanding Parrfy Bonds.
Debt
Service Reserve Account
(DSRA)
$675,438
of
the
proceeds
from the
Series
2003 Bonds was deposited
in
a
DSRA.
These monies
are to be used
by the Bond
Registrar whenever there
exists a deficiency

in
the
Bond and
Interest
Sinking
Fund
Account
for
the
payment
of
the
principal
and interest
on
the Series
2003
Bonds
and any
Parity Bonds.
Repair and
Replacement
and
Development
The Bond
indentures also require a
deposit
be
made
in

the
Repair
and
Replacement
Reserve
Account.
The sum
of
the
deposit shall be
greater
than
l0%
of the Maximum
Debt Service
and
shall
not exceed
the
sum
of
5%
of
the replacement cost of
the auxiliary facilities'
structures
plus
20% of
the
replacement

cost of their
equipment
plus
l0%
of
the
either the
historical cost
of
the
parking
lots
or
100% of the
estimated
cost
of
resurfacing any
existing auxiliary facilities'
parking
lot.
The
Development Reserve
Account
consists
of funds
for
projects
approved by the
Board.

2005
2004
Maximum Allowable Deposits at
June
30
Assets Reserved
Project Amount Approved
by Board
Repair and
Replacement
Reserve
Develop-
ment
Reserve
N/A
$
1,265,676
1,250,000
Repair and
Replacement
Reserve
Develop-
ment
Reserve
27,169,824
$
11,837,260
N/A
25,219,145
$

13,458,771
N/A
N/A
1,228,559
1,250,000
GRANT
AGREEMENT
WITH IJ.S. DEPARTMENT
OF
HOUSING
& URBAN
DEVELOPMENT
On January
l,l974,the
U.
S. Department of Housing and Urban
Development
(HUD)
awarded
a
debt
service subsidy
to the University for
the Union
portion
of
the
University
Union Auditorium
Bond Series

1970-70A.
Annual
payments
under the
grant
agreement
are
not to
exceed
$160,640
and will continue
until the
year
2007, making
the
total
grant
subsidy
approximately
$5,542,080.
This
amount
has
not
been
reflected as
an
amount
due
to

the
auxiliary
facilities
since HUD
has
the right
to
reduce
the amount of the
grant
upon
giving
notice to
the University.
This information is an integtal
part
of
the accompanying financial
statements.
ILLINOIS STATE
UNIVERSITY
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