HomeMy WebLinkAbout20060424_1526.pdfDECISION MEMORANDUM
TO:CO MMISSI 0 NER KJELLAND ER
CO MMISSI 0 NER SMITH
CO MMISSI 0 NER HANSEN
COMMISSION SECRETARY
CO MMISSI ON STAFF
LEGAL
FROM:CECELIA A. GASSNER
DATE:APRIL 21 , 2006
SUBJECT:CASE NOS. AVU-06-1 AND AVU-06-1; AVISTA CORPORATION'
APPLICATION FOR AN ORDER APPROVING A CORPORATE
REORGANIZATION TO CREATE A HOLDING COMPANY, AVA
FORMATION CORP.
On February 16, 2006, Avista Corporation ("Avista" or "Company ) filed an
Application with the Idaho Public Utilities Commission ("Commission ) seeking an order for
authority to conduct a corporate reorganization and form a holding company to be known as
A V A Formation Corp. This Commission has the jurisdiction over such request pursuant to
Idaho Code 9 61-328.
THE APPLICATION
In its Application, A vista has requested an order granting the Company authority to
modify its current corporate structure through the establishment of a holding company. The
holding company, A V A Formation Corp. (the "Parent Corporation ), would be formed as the
parent company of the existing regulated company, Avista Corporation. The Parent Corporation
would also be a parent company of A vista Capital, Inc., which would continue to hold non-
regulated subsidiaries.
A vista Corporation, doing business as A vista Utilities, is currently the corporate
parent. The proposed structure would make A vista Utilities a separate company under the Parent
Company and A vista Corporation would no longer exist as an operating entity.
A vista states that due to the recent repeal of the Public Utilities Holding Company
Act of 1935 (PUHCA), the Company considers it to be in the best interest of customers and
shareholders to change the corporate structure of A vista into a holding company structure. The
DECISION MEMORANDUM
Company believes that this reorganization would provide additional protection for ratepayers by
ring fencing" or further separating utility operations from the Company s other non-regulated
businesses.
STAFF RECOMMENDATION
Staff recommends that the Company s Application be processed by Modified
Procedure with a comment period extending June 16, 2006. This should allow sufficient time for
interested parties to review the Company s Application and file their comments with the
Commission. Reference Commission Rules of Procedure, IDAP A 31.01.01.201-.204.
In addition, the Staff recommends that a date for a workshop be established at which
time Staff Company and any interested parties may discuss certain issues concerning this
Application. The Staff recommends May 16, 2006 as the date for this workshop. It is Staff s
understanding that the Company is available and is willing to meet on this date.
COMMISSION DECISION
Does the Commission preliminarily find that the public interest may not require a
hearing to consider the issues presented in this case, and that this case is appropriate for
Modified Procedure pursuant to Commission Rules of Procedure 201 through 204?
Does the Commission approve of the recommended comment period?
Does the Commission approve the Staff s proposed workshop schedule?
M:A VUEO601 A VUGO601
DECISION MEMORANDUM