WASHINGTON - The Internal Revenue Service is auditing $245.7 million of hospital revenue bonds issued in September 2006 by The Board of Trustees of the University of Alabama in Birmingham.
The IRS notified the board about the audit in a January 2012 letter.
The Board disclosed the letter in an event notice it filed with the Municipal Securities Rulemaking Board's EMMA system this week, noting that its disclosure was voluntary and not required by the Securities and Exchange Commission's Rule 15c2-12, the notice said.
In the letter the board said it, "is not aware of any fact or circumstance would adversely affect the examination of the interest of the Series 2006-A bonds from the federal income taxation."
The Board also said that the audit indicated that the bonds had been selected by the IRS for a routine examination.
The Series 2006-A bonds were issued to refund outstanding debt and finance capital improvements for the University of Alabama's hospital facilities. The bonds are backed by pledged revenues derived by the UA board from the operation, management and leasing of the hospital-related patient care facilities, according to bond documents.
The UAB is a comprehensive, public urban university located in Birmingham, Alabama.
The University of Alabama Hospital is operated as part of the UAB division of the UA board and is a 908-acute care hospital located on the university campus, according to bond documents.
The UAB Healthy System is an Alabama nonprofit corporation and a 501(c)3 organization that manages a health care delivery system known by the same name "UAB Health System." The revenues from the University Hospital are the sole source of payment of the Series 2006-A bonds, bond documents said.
Morgan Keegan & Company, now Raymond James/Morgan Keegan, was co-underwriter along with The Frazer Lanier Co.
Presley Burton & Collier, LLC was bond counsel.
Maynard, Cooper & Gale, PC was underwriter's counsel.