South Carolina Code 37-11-40. Determination of financial responsibility of applicant for license
(B) In making this determination for a license, the department may consider the project feasibility document provided pursuant to § 37-11-30(B)(11), which is deemed trade secret and must include at least the following:
Terms Used In South Carolina Code 37-11-40
- Assets: (1) The property comprising the estate of a deceased person, or (2) the property in a trust account.
- Continuing care contract: means a contract to provide board or lodging together with nursing, medical, or other health-related services:
(a) to a person sixty-five years of age or older at the time the contract is signed or purchased; or
(b) which provides for services for the life of the person or for more than one year, including mutually terminable contracts; and
(c) which requires payment of an entrance fee or other fee in return for a promise of future care. See South Carolina Code 37-11-20 - Continuing care retirement community: means a community in which there is furnished, pursuant to a continuing care contract, to two or more persons not related to the administrator or owner of the facility within the third degree of consanguinity, board or lodging together with nursing, medical, or other health-related services, regardless of whether the services or lodging are provided at the same location or not. See South Carolina Code 37-11-20
- Contract: A legal written agreement that becomes binding when signed.
- Department: means the South Carolina Department of Consumer Affairs. See South Carolina Code 37-11-20
- Facility: means the place in which an operator undertakes to provide continuing care to a person. See South Carolina Code 37-11-20
- Health-related services: includes a degree of personal assistance in feeding, dressing, or other essential daily living activities. See South Carolina Code 37-11-20
- Liabilities: The aggregate of all debts and other legal obligations of a particular person or legal entity.
- Resident: means a purchaser of, a nominee of, or a subscriber to a continuing care contract. See South Carolina Code 37-11-20
(1) a statement of the purpose and need for the facility;
(2) a description of the proposed facility, including the location, size, number of units to be constructed, anticipated completion date, and the proposed construction program;
(3) an identification and evaluation of the primary market areas and assumptions as to the secondary market areas, as well as the proposed unit sales per month;
(4) projected revenues from all sources, including:
(a) anticipated entrance fees;
(b) monthly service fees;
(c) nursing care rates, if applicable; and
(d) the total amount of financing required;
(5) projected expenses, including:
(a) staffing requirements and salaries;
(b) property, plant, and equipment costs, including depreciation expense;
(c) interest expense;
(d) marketing expenses; and
(e) other operating expenses;
(6) current assets and liabilities of the applicant;
(7) expectations of the financial condition of the facility, including the projected cash flow and a projected balance sheet and an estimate of the funds anticipated to be necessary to cover start-up losses;
(8) the inflation factor, if any, assumed in the study for the proposed facility and how and where it is applied;
(9) financial forecasts or projections prepared in accordance with standards promulgated by the American Institute of Certified Public Accountants, or in accordance with standards for feasibility studies for continuing care retirement communities promulgated by the Actuarial Standards Board, and an independent evaluation and opinion by the consultant who prepared the study of the underlying assumptions used as the basis for the forecasts or projections in the study. The study shall take into account facility costs, marketing projections, resident fees and charges, competition, resident contract provisions, and other factors which affect the feasibility of the study;
(10) an opinion letter prepared by the person who prepared the study as to the financial feasibility of the facility;
(11) the name, address, and telephone number of the person who prepared the feasibility study and the experience of the person in preparing similar studies or otherwise consulting in the field of continuing care; and
(12) a detailed written statement regarding the specific provisions taken, or to be taken, to enable the applicant to perform its obligations fully under contracts to provide continuing care. The provisions may include surety bonds, financial reserves, letters of credit, adequacy of working capital and actual and projected occupancy rates, and other financial arrangements or assurances as permitted in this section.
(C) In making this determination for a final license, the department may consider, without limitation, the following in addition to the items listed in subsection (B):
(1) the financial soundness of the arrangements for board, lodging, or medical, nursing, or health-related services and the schedule of charges used in connection with them;
(2) the adequacy of working capital;
(3) if the continuing care contract provides for services for the life of the person or for more than one year including mutually terminable contracts, a surety bond, financial reserves, letter of credit, or other financial arrangement to guarantee the performance of contractual obligations;
(4) an agreement with providers for the provision of health care or health-related services.