News City of Kyle Signs Letter of Intent for New Seton Hospital

Kyle, TX (May 3, 2007) - In a special called meeting today, the Kyle City Council ratified an historic Letter of Intent with the Seton Family of Hospitals and SCC Development for the construction of a significant mixed-use development featuring a hospital, professional offices and a retail shopping center.

This $438 million project represents the single largest development in Hays County and is projected to ultimately bring 4,600 jobs into Kyle's employment base.

"It is an honor and a privilege to bring to the City of Kyle a development of this size and scope that represents everything we want Kyle to be," said Tom Mattis, Kyle City Manager.

"This quality, multi-functional development not only provides the amenities our residents deserve, but also provides for high-level, bread-winner-type jobs allowing people to live, play and work in Kyle," added Mattis.

The agreement features a unique revenue sharing arrangement in the place of tax abatements, thus allowing the development to proceed without the use of public moneys. The basis of this agreement is the sharing of future sales tax revenue during the first years of the development, with all sales tax revenue eventually coming to the City and County. There are no property tax abatements associated with this agreement. The Hays Consolidated Independent School District is also a beneficiary as they will see a projected revenue increase of approximately $70 million over the next 20 years without giving any concessions to the project.

"I'm proud of the way the parties have come together to structure this project in a manner that is beneficial to everyone and takes into consideration the proper use of the public's money," said Kyle Mayor Mike Gonzalez. "Kyle is really becoming a leader in designing performance-based incentives that are attractive to the developers and respective of our tax dollars. Structuring deals in this way allows us to bring these projects to Kyle sooner rather then later."

The Seton Family of Hospitals plans to construct a 210 bed medical facility along side a retail and professional office complex being planned and built by SCC Development Company of Austin.

"As a community ministry with more than 100 years of service to Central Texas, the Seton family has always considered it our responsibility to provide health care services to all the people of this region," Charles J. Barnett, President and CEO of Seton explained. "As Central Texas continues to grow, we have a responsibility to be accessible in Hays County and to provide the same level of care that is delivered throughout the Seton Family of Hospitals. We are very pleased today to be one step closer to bringing a major medical center to this area that will offer complex health care services to the continually growing population south of Travis County."

"This is a very unique project and the first of its kind for the City of Kyle and Hays County," said Scott Deskins, President of SCC Development. "We are looking forward to the opportunity in working with the City of Kyle in an effort to seamlessly integrate a development of this size and nature into the woven fabric of the community."

A key component of Seton's commitment to the community is its agreement to participate in a study to determine the area's indigent health-care needs. Although the complete scope of this study is still being discussed, all parties are committed to addressing this issue.

Representatives for the Hays County Commissioners' Court also were on hand to state their unanimous support for the project. The Court is expected to ratify the Letter of Intent at their May 8^th regular meeting.

"The county's primary interest in this is health care and the hospital," said County Commissioners Debbie Ingalsbe and Jeff Barton in a joint statement. "We're excited about the good-paying jobs this will bring, as well the tax base, and of course the services and choice that comes with the private development. But what really excited the county was the potential for partnering ot improve health care delivery in this end of the county. The court is fully behind this. We've worked closely with the city. Congratulations to Kyle and its leaders."

While Seton representatives look forward to becoming an integral part of the Hays County and City of Kyle community, this Letter of Intent represents the next step in Seton's approval process. Seton's local Board of Trustees has indicated its support of the project, but the

A final decision on actual development at the site is dependent upon approval by the Board of Trustees of Ascension Health, of which Seton is a member.

Consideration of the project for approval is expected to occur at the September Ascension Health Board meeting. The willingness on the part of both the City of Kyle and the County to indicate their support for Seton becoming a part of the community will certainly be viewed as a critical factor.

"We believe this Letter of Intent will go a long way in helping the Ascension Health Board of Trustees appreciate and understand that this unique project, anchored with a new Seton Family medical center, is very much desired in this community," said Tom Gallagher, Senior Vice President, Business Development, Seton Family of Hospitals.