Illinois Administrative Code › Title 77 - PUBLIC HEALTH › Part 1126 - SPECIALIZED MENTAL HEALTH REHABILITATION FACILITIES (SMHRFs) › Subpart E - FINANCIAL AND ECONOMIC FEASIBILITY - REVIEW CRITERIA › Appendix B - Financial and Economic Review Standards

Current through Register Vol. 48, No. 28, July 12, 2024
a) Reasonableness of Project and Related Costs
				  Standards
1) Preplanning Costs shall not exceed
				  1.8 %
				  of construction and modernization contracts, plus contingencies, plus equipment
				  costs.
2) Site Survey and Preparation Costs shall not
				  exceed 5% of construction and contingency costs.
3) New Construction and Modernization Costs per
				  Gross Square Foot (GSF) SMHRF cost standards are derived from the RSMeans
				  Building Construction Cost Data (Means) publication (RSMeans, 63 Smiths Lane,
				  PO Box 800, Kingston MA 02364-9988, 800/334-3509; 2015, no later amendments or
				  editions included) and will be adjusted (for inflation and location) for each
				  project to the current year (www.rsmeans.com [File Link Not Available]).
HFSRB NOTE: HFSRB staff will review the cost per
				  square foot data submitted in the application to determine compliance with the
				  latest available cost standards of the RSMeans publication.
HFSRB NOTE: Modernization includes the build out
				  of leased space and shall include the cost of all capital improvements
				  contained in the terms of the lease. These standards are based on 2008
				  data.
Type of Facility
New Construction
Modernization
SMHRF
Adjusted Means 3rd
							 Quartile
70% of Adjusted Means 3rd
							 Quartile
4) Contingencies
Contingency costs for projects (or for components
				  of projects) are based on a percentage of new construction or modernization
				  costs and are based on the status of a project's architectural contract
				  documents.
Status of Project
New Construction
Modernization
Contract Documents
Components
Components
Schematics
10%
10-15%
Preliminary
7%
7-10%
Final
3-5%
5-7%
5) New Construction or Modernization Fees and
				  Architectural & Engineering (A&E) Fees
Current fees for services for projects or
				  components of projects involving new construction or modernization (total
				  amount of construction and contingencies, A&E fees for SMHRFs and total
				  fees for site work) can be found in the Centralized Fee Negotiation
				  Professional Services and Fees Handbook (available at www.cdb.state.il.us [File
				  Link Not Available] or by contacting the Capital Development Board, 401 South
				  Spring Street, Springfield, Illinois 62706). HFSRB shall, for all calculations,
				  consider the latest version of the handbook as released on the Capital
				  Development Board website.
A) Projects or Components of Projects Involving
				  New Construction
Total Amount of Construction and
							 Contingencies
SMHRF
under $100,000
10.59 -15.89%
$ 200,000
9.99 -14.99%
$ 300,000
9.48 -14.22%
$ 400,000
9.03 -13.55%
$ 500,000
8.65 -12.99%
$ 700,000
8.21 -12.33%
$ 900,000
7.89 -11.85%
$ 1,000,000
7.79 -11.69%
$ 1,250,000
7.62 -11.44%
$ 1,500,000
7.49 -11.25%
$ 1,750,000
7.36 -11.06%
$ 2,500,000
7.06 -10.60%
$ 3,000,000
6.89 -10.35%
$ 5,000,000
6.42 -9.64%
$ 7,000,000
6.11 -9.17%
$ 9,000,000
5.94 -8.92%
$ 10,000,000
5.90
							 -8.86%
$ 15,000,000
5.76 -8.66%
$ 20,000,000
5.64 -8.48%
$ 25,000,000
5.52 -8.28%
$ 30,000,000
5.37 -8.07%
$ 40,000,000
5.12 -7.68%
$ 50,000,000
4.86 -7.30%
$100,000,000
3.59 -5.39%
and over
B) Projects or Components of Projects Involving
				  Modernization
Total Amount of Construction and
							 Contingencies
A&E Fees for SMHRF
under $100,000
10.76 -16.16%
$ 200,000
10.16 -15.26%
$ 300,000
9.65 -14.49%
$ 400,000
9.20 -13.80%
$ 500,000
8.81-13.23%
$ 700,000
8.36 -12.56%
$ 900,000
8.04 -12.06%
$ 1,000,000
7.93 -11.91%
$ 1,250,000
7.76 -11.66%
$ 1,500,000
7.63 -11.45%
$ 1,750,000
7.50 -11.26%
$ 2,000,000
7.40 -11.12%
$ 2,500,000
7.19 -10.79%
$ 3,000,000
7.02 -10.54%
$ 5,000,000
6.54 -9.82%
$ 7,000,000
6.22 -9.34%
$ 9,000,000
6.04 -9.08%
$ 10,000,000
6.00 -9.02%
$ 15,000,000
5.87 -8.81%
$ 20,000,000
5.74 -8.62%
$ 25,000,000
5.62 -8.44%
$ 30,000,000
5.48 -8.22%
$ 40,000,000
5.21 -7.83%
$ 50,000,000
4.95 -7.43%
$100,000,000
3.65 -5.49%
and over
6) Capital Equipment Not Included in Construction
				  Contracts Standards for capital equipment not included in construction
				  contracts are established by type of facility and are derived from the third
				  quartile costs of previously approved projects for which data are available.
				  The standards apply only to the following types of projects: establishment of
				  new facilities, expansion of existing facilities (e.g., bed additions), and
				  modernization of existing facilities involving replacement of existing beds,
				  relocation of existing facilities, etc. The standard in this subsection (a)(6)
				  is calculated for the year 2013.
HFSRB NOTE: Modernization includes the build out
				  of leased space and shall include the cost of capital equipment included in the
				  terms of the lease.
SMHRFs per Bed
$7,524.83
7) Inflation Factor
Costs for construction and modernization contracts
				  and equipment are to be adjusted for projected inflation. The projected
				  inflation rate is to be calculated to the midpoint of construction. For
				  construction midpoint of up to 3 years, the inflation rate shall be an average
				  of the previous 3 years annual inflation rates for construction as determined
				  by RSMeans. For construction midpoints beyond 3 years, the inflation rate shall
				  be the lesser of this rate or 3% for the period of time beyond 3 years.
b) Financial Viability Standards
1) Current Ratio = Current Assets/Current
				  Liabilities
Type of SMHRF
Current Ratio
Not-For-Profit, System
1.5 or
							 more
Not-For-Profit, Non-System
1.5 or
							 more
For-Profit, System
1.5 or
							 more
For-Profit, Non-System
1.5 or
							 more
Governmental
1.5 or
							 more
2) Net Margin Percentage = (Net Income/Net
				  Operating Revenues) X 100
Type of SMHRF
Net Margin
Not-For-Profit, System
2.5 % or more
Not-For-Profit, Non-system
2.5% or more
For-Profit, System
2.5% or more
For-Profit, Non-system
2.5% or more
Governmental
0% or more
HFSRB NOTE: Net Margin Percentage for For-Profits
				  is before the provision for income taxes. Net income is the excess of revenues
				  over expenses from operations, before non-recurring income or expense.
3) Long-Term Debt to Capitalization = (Long-Term
				  Debt/Long-Term Debt plus Net Assets) X 100
Type of SMHRF
Long Term Debt to Capitalization
Not-For-Profit, System
80% or less
Not-For-Profit, Non-system
80% or less
For-Profit, System
50% or less
For-Profit, Non-system
50% or less
Governmental
NA
HFSRB NOTE: For SMHRFs and for-profit facilities,
				  the applicant shall explain the rationale of the use of debt rather than the
				  issuance of stock (if this is the case).
4) Projected Debt Service Coverage = Net Income
				  plus (Depreciation plus Interest plus Amortization)/Principal Payments plus
				  Interest Expense for the Year of Maximum Debt Service after Project
				  Completion
Type of SMHRF
Project Debt Service Coverage
Not-For-Profit, System
1.5 or
							 more
Not-For-Profit, Non-system
1.5 or
							 more
For-Profit, System
1.5 or
							 more
For-Profit, Non-system
1.5 or
							 more
Governmental
1.5 or
							 more
HFSRB NOTE: Net Income is the excess of revenues
				  over expenses from operations, before non-recurring income or expense.
5) Days Cash on Hand = (Cash plus Investments plus
				  Applicant Board Designated Funds)/(Operating Expense less Depreciation
				  Expense)/365 days
Type of SMHRF
Days Cash on Hand
Not-For-Profit, System
45 or more days
Not-For-Profit, Non-system
45 or more days
For-Profit, System
45 or more days
For-Profit, Non-system
45 or more days
Governmental
45 or more days
HFSRB NOTE: The Days Cash on Hand requirement can
				  be met by a combination of cash and investments held by the facilities or
				  available funds from the backup line of credit.
6) Cushion Ratio = (Cash plus Investments plus
				  Board Designated Funds)/(Principal Payments plus Interest Expense for the Year
				  of Maximum Debt Service after Project Completion)
Type of SMHRF
Cushion Ratio
Not-For-Profit, System
3.0 or more
Not-For-Profit, Non-system
3.0 or more
For-Profit, System
3.0 or more
For-Profit, Non-system
3.0 or more
Governmental
NA
HFSRB NOTE: The applicant may also include in the
				  numerator the amount of funds available from an existing or proposed backup
				  line of credit. If the applicant includes funds available from a line of
				  credit, it shall provide documentation regarding the terms and conditions of
				  the line.