20261027Decision Memo.pdf

DECISION MEMORANDUM
TO: COMMISSIONER LODGE
COMMISSIONER HAMMOND
COMMISSIONER HARDIE
COMMISSION SECRETARY
COMMISSION STAFF
LEGAL
FROM: JAMES CHANDLER,AUDITOR 3
KELSEA E. ROSS,DEPUTY ATTORNEY GENERAL
DATE: OCTOBER 27, 2026
RE: IN THE MATTER OF AVISTA'S APPLICATION FOR AUTHORIZATION
TO ENTER INTO UP TO $100,000,000 IN PRINCIPAL AMOUNT OF
CORPORATION ADDITIONAL SHORT-TERM UNSECURED
INDEBTEDNESS; CASE NO.AVU-U-26-02.
BACKGROUND
On October 7,2026,Avista Corporation("Company")applied to the Idaho Public Utilities
Commission("Commission")for authority to enter into an unsecured term loan agreement("Term
Loan") in the principal amount of up to $100,000,000 with a term of less than 12 months from the
closing date. Application at 1. The requested authorization would be"in addition to any authority
previously granted by the Commission pursuant to"Idaho Code §§ 61-901 and-902. Id.
Because the Term Loan, together with the Company's "other outstanding notes and drafts
having maturities of 12 months or less for which [the Company] is primarily or secondarily liable,
may exceed the five-percent threshold established by"Idaho Code § 61-903, the Company states
that "the short-term-debt exemption under that section may not apply." Id. The Company states
that "the Term Loan would provide supplemental liquidity needed to support ongoing utility
operations and seasonal working capital requirements." Exhibit D-2 at 2. The Company states
that "the Term Loan will also enable it to prudently manage potential volatility in natural gas and
wholesale power markets, thereby supporting the continued reliable provision of electric and
natural gas service to customers." Id. The required filing fee of $1,000 was received by the
Commission on October 22, 2026.
DECISION MEMORANDUM - 1 - OCTOBER 27, 2026

STAFF DISCUSSION
Staff reviewed the Application and believes that the proposed unsecured Term Loan meets
the requirements of Idaho Code § 61-901, as the Term Loan is"for the acquisition of property; for
the construction, completion, extension[,] or improvement of its facilities; for the improvement or
maintenance of its service; for the discharge or lawful refunding of its obligations;"and for general
corporate purposes. Staff also believes that the Application satisfies the filing requirements under
Idaho Code § 61- 905 and Commission Rules of Procedure 141-150 (IDAPA 31.01.01.141-150).
Staff believes that the Company's short-term debt does not qualify for the short-term debt
exemption outlined in Idaho Code § 61-903, as Company states that the value of the unsecured
debt may exceed five-percent threshold outlined in Idaho Code § 61-903. Application at 1.
Therefore, Staff believes that Commission approval is required of the Company's requested short-
term debt issuance.
Consistent with Order Nos. 29947 and 30036, Staff believes the Company should continue
to comply with all reporting and filing requirements applicable to debt issued pursuant to the
authority requested and should continue to do so unless otherwise ordered by the Commission.
Lastly, Staff believes authorization of the request would not significantly impact the
Company's capital structure or result in changes to customer rates. Furthermore, all funds derived
and used as a result of the borrowings would be subject to a prudence review and Commission
approval in future filings.
STAFF RECOMMENDATION
Staff recommends that the Commission: (1) approve the Company's request for authority
to enter into a Term Loan in the principal amount of up to $100,000,000 with a term of less than
12 months; (2) require the Company to file the terms of the proposed Term Loan and any
subsequent changes to those terms with the Commission as soon as possible; and (3) require the
Company to continue complying with the reporting and filing requirements established in Order
Nos. 29947 and 30036.
COMMISSION DECISION
Does the Commission wish to:
1. Approve the Company's request for authority to enter into a Term Loan in the principal
amount of up to $100,000,000 with terms less than 12 months?
DECISION MEMORANDUM - 2 - OCTOBER 27, 2026

2. Require the Company to file the terms of the proposed Term Loan and any subsequent
changes to those terms with the Commission as soon as possible; and
3. Require the Company to continue complying with the reporting and filing requirements
established in Order Nos. 29947 and 30036?
u�
James Chandler
Auditor 3
I:\Utility\UDMEMOS\AVLT-U-26-02 Decision Memo.docx
DECISION MEMORANDUM - 3 - OCTOBER 27, 2026