Compared to Three Months Ended March 31, 2000. The increase is primarily due to the recognition of management fees and accounting and financial fees which have been paid in 2001 but which were not being earned in the prior year. Increases in salaries, wages and benefits are due primarily to increased bonus and benefit programs compared to the quarter a year ago. The increases result both from inflationary increases and from changes in the benefit programs. Increases in other operating costs and expenses are due to inflationary increases and higher occupancies in assisted living and independent living services.
Rent increases are due primarily to additions at existing rental properties.
The decrease in cash generated from operating activities is due to decreases in accrued payroll and trade accounts payable as compared to the prior period for the same items. Our current cash on hand, marketable securities, short-term notes receivable, operating cash flows and, as needed, our borrowing capacity are expected to be adequate to finance our operating requirements and growth and development plans for 2001 and into 2002. For all financial instruments, we believe that the financial statement carrying amounts approximate fair value at March 31, 2001. As a result of the health care industry's generally weak financial position, our guarantee of third party debt and the uncertainty engendered by the increasing number of medical liability claims in the state of Florida, we have experienced and are experiencing the potential for significant defaults in financial obligations which we have undertaken. Management believes that the lending institutions will agree to not exercise the put option provided that NHC, NHI and National make additional principal repayments on the debt during 2001.