20020228Application.pdf

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSJON
IN THE MATTER OF THE APPLICATION OF )IDAHO POWER COMPANY FOR AN ORDER )CASE NO.IPC-E-
AUTHORIZING UP TO $350,000,000 )AGGREGATE PRINCIPAL AMOUNT AT )APPLICATION
ANY ONE TIME OUTSTANDINGOF )SHORT-TERM BORROWINGS )
IDAHO POWER COMPANY (the "Applicant")hereby applies for an Order of the
Idaho Public Utilities Commission (the "Commission")authorizing the Applicant to incur up to
$350,000,000aggregate principal amount at any one time outstandingof Short-Term Borrowings,
pursuant to Chapter 9,Title 61,IdahoCode,and under Rules 141 through 150 of the Commission's
Rules of Procedure (the "Rules").
(a)The Applicant
The Applicant is an electric public utilityincorporated under the laws of the state of
Idaho,engaged principallyin the generation,purchase,transmission,distribution and sale of electric
energy in an approximately 20,000 square mile area in southern Idaho and eastern Oregon.The
principal executive offices of the Applicant are located at 1221 W.Idaho Street,P.O.Box 70,Boise,
Idaho 83707-0070;its telephone number is [phone].
(b)Description of Securities
The securities will consist of loans issued by financial and other institutions and evidenced by
unsecured notes or other evidence of indebtedness;and unsecured promissory notes to be issued for
public or private placement through one or more commercial paper dealers or agents,or
APPLICATION -1
directly by Applicant.
(i)Amount of Securities
The securities proposed to be issued by Applicant will not exceed a total of
$350,000,000 aggregate principal amount at any one time outstanding.
(ii)Interest Rate
Applicant anticipates said borrowings will provide that the interest rates may
be fixed or variable during the term of said loans,and that the rates will be based on LIBOR,the
applicable prime rate,or other rate established in the borrowing arrangements,and may vary based
upon the credit ratings of Applicant's first mortgage bonds.
(iii)Date of Issue
The proposed borrowings may be issued by the Applicant during the one-year
period from April 1,2002 to and includingMarch 31,2003.
(iv)Date of Maturity
The proposed borrowings will have varying maturities of not more than twelve
months.In no event will any borrowing have a final maturity beyond March 31,2004.
(v)Voting Privileges
Not applicable.
(vi)Call or Redemption Provisions
Not applicable.
(vii)Sinking Fund or Other Provisions for Secured Payment
Not applicable.
APPLICATION -2
(c)Manner of Issuance
(i)Method of Marketing
Applicant intends to secure commitments for up to one year for unsecured
Lines of Credit,individually or through an agent,with several financial or other institutions when
and if required by Applicant's then current financial requirements (see Paragraph (d)).Each
individual Line of Credit Commitment will provide that up to a specific amount at any one time
outstanding will be available to Applicant to draw upon for a fee to be determined by a percentage of
the credit line available,credit line utilization,compensating balance or combination thereof.
A syndicated facility would include an arrangement fee estimated at $250,000
payable to the agent,an annual fee estimated at $30,000 payable to the agent,and a facility fee
determined by a percentage of each bank's commitment.
Applicant may also make arrangements for uncommitted credit facilities under
which unsecured Lines of Credit would be offered to Applicant on an "as available"basis and at
negotiated interest rates.Such committed and uncommitted borrowings will be evidenced by
unsecured promissory notes or other evidence of indebtedness.The committed and uncommitted
Line of Credit agreements specifying the terms of Applicant's borrowings will be filed with the
Commission as soon as available as Exhibit A.
Unsecured promissory notes will be issued and sold by Applicant through one
or more commercial paper dealers or agents,or directly by Applicant.Each note issued as
commercial paper will be either discounted at the rate prevailing at the time of issuance for
commercial paper of comparable quality and maturity or will be interest bearing to be paid at
APPLICATION -3
maturity.Each note will have a fixed maturity and will contain no provision for automatic "roll
over".
(ii)Terms of Sale
See Paragraph (c)(i),Method of Marketing.
(iii)Underwritine Discounts or Commissions
(A)Reference is made to paragraph (c)(i),Method of Marketing,which
specifies the method of payment of fees to the financial or other institutions pursuant to the Line of
Credit arrangements.
(B)It is expected that the commercial paper dealers or agents will sell such
notes at a profit to them of not to exceed 1/8 of I percent of the principal amount of each note.
(iv)Sales Price
See paragraph (c)(iii),UnderwritingDiscounts or Commissions.
(d)Purpose of Issuance
The proposed short-term borrowings will be made,and the promissory notes,
commercial paper,or other evidence of indebtedness issued,to obtain temporary,interim capital
(including renewal of short-term notes or other evidence of indebtedness issued or outstanding prior
to April I,2002),for the followingpurposes:
(i)Property to be Acquired or Constructed
The short-term funds will be used to finance Applicant's ongoing construction
program including,but not limited to,new plant investment as well as the upgrade of existing
generation,distribution,transmission and general plant.
APPLICATION -4
(ii)Refunding of Obligations and Reimbursement of Expenditures
The short-term funds may also be used by Applicant for the retirement of
maturing debt and the possible repurchase or defeasance of certain debt or preferred stock presently
outstanding.
(iii)Other Purposes
Applicant may also use the short-term funds for general corporate purposes
including,but not limited to,the possible purchase of electric utilityassets and service territory and
the possible repurchase of common shares and/or debt securities of Applicant on the open market.
(e)Propriety of Issue and Guarantee
Applicant believes and alleges the fact set forth in Paragraph (d)disclose that the
proposed short-term borrowings are for a lawful object within the corporate purposes of Applicant
and compatible with the public interest,and are necessary or appropriatefor,or consistent with,the
proper performance by Applicant of service as a public utility and will not impair its ability to
perform that service.
(f)Financial Statements,Resolutions
Applicant will file herewith as Attachment I by March 8,2002 its financial statements
dated December 31,2001 consisting of its (A)Actual and Pro Forma Balance Sheet and Notes to
Financial Statements,(B)Statement of Capital Stock and Funded Debt,(C)Commitments and
Contingent Liabilities,(D)Statement of Retained Earnings and (E)Statement of Income.
APPLICATION -5
A certified copy of the resolutions of Applicant's Directors authorizingthe transaction
with respect to this Application will be filed with the Commission as Attachment II immediately
after the Applicant's March 21,2002 Board Meeting.
(g)Proposed Order;Request for Expeditious Action
Applicant has filed as Attachment III a Proposed Order for adoption by the
Commission if this Application is granted
(h)Notice of Application
Notice of this Application will be published in those newspapers in Applicant's
service territory listed in Rule 141(h)of the Commission's Rules within seven (7)days of the date
hereof.
(i)Reports
Applicant will file as Exhibit A hereto,a verified report with the Commission
pursuant to Rule 143,listingthe proposed agreements for the committed and uncommitted unsecured
Lines of Credit and other agreements evidencing the borrowing arrangements.
PRAYER
WHEREFORE,Applicant requests that the Idaho Public Utilities Commission issue
its Order authorizing Applicant,during the period from April 1,2002 to and includingMarch 31,
2003,to make short-term borrowings and to issue unsecured notes (including renewal notes)or other
evidence of indebtedness,for the purposes herein set forth in an amount not to exceed $350,000,000
aggregate principal amount at any one time outstanding.Applicant further requests authority to
APPLICATION -6
substitute commercial paper borrowings for the Lines of Credit,or other borrowing arrangements up
to the limits imposed by applicable statutes,rules or regulations.
DATED at Boise,Idaho this day of February 2002.
IDAHO POWER COMPANY
/s/Darrel T.Anderson
Vice President,CFO and Treasurer
(CORPORATE SEAL)
TTE :
/s/Robert W.Stahman
Secretary
Idaho Power Company
1221 W.Idaho Street
Boise,ID 83707-0070
APPLICATION -7
VERIFICATION
I,Darrel T.Anderson,declare that I am the Vice President,CFO and Treasurer of
Idaho Power Company,and am authorized to make this Verification.The application and the
attached exhibits were prepared at my direction and were read by me.I know the contents of the
Application and the attached exhibits,and they are true,correct and complete to the best of my
knowledge and belief.
WITNESS my hand and seal of Idaho Power Company thisif day of February,
2002.
/s/Darrel T.Anderson
SUBSCRIBED AND SWORN to me this 2 day of February,2002.
(Notary Se ',
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APPLICATION -8
ATTACHMENT III
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
IN THE MATTER OF THE APPLICATION OF )
IDAHO POWER COMPANY FOR AN ORDER )CASE NO.IPC-E-
AUTHORIZING UP TO $350,000,000 )
AGGREGATE PRINCIPAL AMOUNT AT )PROPOSED ORDER
ANY ONE TIME OUTSTANDING OF )
SHORT-TERM BORROWINGS )
On February 28,2002,Idaho Power Company (IdahoPower),an electrical utility and
headquartered in Boise,Idaho,providing retail electric service in southern Idahoand eastern Oregon,
filed with this Commission its Application pursuant to Chapter 9,Title 61 of the Idaho Code and
Rules 141 through 150 of the Commission's Rules of Procedure,requesting an Order authorizing
Idaho Power to incur up to $350,000,000aggregateprincipal amount of short-term borrowingsat any
one time outstanding.The Commission hereby adopts it Findings of Fact,Conclusions of Law and
Order approving the Application.
FINDINGS OF FACT
I
Idaho Power was incorporatedon May 6,1915 and migrated its state of incorporation
to the state of Idaho on June 30,1989 and is dulyqualified to do business in the state of Idaho.Idaho
Power's principal office is located in Boise,Idaho.
II
Idaho Power proposes,subject to the approval of the Commission,to secure
commitments for unsecured Lines of Credit for up to one year with several financial and other
institutions.Each Line of Credit commitment will provide that up to a specific amount at any one
time outstandingwill be available to IdahoPower to draw upon for a fee to be determined either by a
PROPOSED ORDER -1
percentage of the credit line available,credit line utilization,compensating balance or combination
thereof.In the case of a syndicated facility,Idaho Power will pay an arrangement fee and an annual
fee to the agent as well as a facility fee based on a percentage of each bank's commitment.Idaho
Power may also make arrangements for uncommitted credit facilities under which unsecured Lines
of Credit would be offered to Idaho Power on an "as available"basis and at negotiatedinterest rates.
Such committed and uncommitted borrowings will be evidenced by unsecured promissory notes or
other evidence of indebtedness.
In addition,unsecured promissory notes will be issued and sold by Idaho Power
directly or through one or more commercial paper dealers or agents.Each note issued as commercial
paper will be either discounted at the rate prevailing at the time of issuance for commercial paper of
comparable quality and maturityor will be interest-bearing to be paid at maturity.Each such note
will have a fixed maturityand contain no provision for automatic "roll over".
III
The proposed borrowings may be issued by Idaho Power during the periodfrom April
1,2002 to and includingMarch 31,2003.The proposed borrowings will have varying maturities,
but in no event will any borrowing have a final maturitybeyond March 31,2004.
IV
Idaho Power states the purpose for which the proposed short term borrowings will be
made and promissory notes,commercial paper or other evidence of indebtedness issued,is to obtain
temporary,interim capital (including renewal of short-term notes or other evidence of indebtedness
issued or outstanding prior to April 1,2002),to finance Idaho Power's ongoing construction
PROPOSED ORDER -2
program,including,but not limited to,new plant investment,as well as the upgrade of existing
generation,distribution,transmission and general plant,and for general corporate purposes
including,but not limited to,the possible purchase of electric utilityassets and service territory,the
possible repurchase of common shares of Idaho Power,the retirement of maturing debt and the
possible repurchase or defeasance of certain debt or preferred stock presently outstanding.
CONCLUSIONS OF LAW
Idaho Power is an electrical corporation within the definition of Idaho Code §61-119
and is a public utility within the definition of Idaho Code §61-129.
The Idaho Public Utilities Commission has jurisdiction over this matter pursuant to
the provisions of Idaho Code §61-901 et seq.,and the Application reasonably conforms to Rules
141 through 150 of the Commission's Rules of Procedures,IDAPA 31.01.01.141-150.
The method of issuance is proper.
The general purposes to which the proceeds will be put are lawful purposes under the
Public Utility Law of the state of Idaho and are compatible with the public interest.However,this
general approval of the general purposes to which the proceeds will be put is neither a finding of fact
nor a conclusion of law that any particular construction program of the Company which may be
benefitedby the approval of this Application has been considered or approved by this Order,andthis
Order shall not be construed to that effect.
The issuance of an Order authorizing the proposed financing does not constitute
agency determination/approval of the type of financing or the related costs for ratemakingpurposes,
which determination the Commission expressly reserves until the appropriate proceeding.
All fees have been paid by Idaho Power in accordance with Idaho Code §61-905.
PROPOSED ORDER -3
ORDER
IT IS THEREFORE ORDERED that Idaho Power Company be,and the same is
hereby authorized,during the period from April 1,2002 to and includingMarch 31,2003 to make
short-term borrowings and to issue unsecured notes (includingrenewal notes),for the purposes
herein set forth,in an amount not to exceed $350,000,000aggregate principal amount of short-term
promissory notes or other evidence of indebtedness to be outstanding at any one time,with a final
maturityof no later than March 31,2004.Idaho Power is further authorized to the extent permissible
under applicablegovernmental statutes and regulationsto substitute commercial paper borrowings
for the Lines of Credit,or other borrowing arrangements,up to the limit of $350,000,000aggregate
principal amount at any one time outstanding as herein set forth.No additional authorization is
required to carry out this transaction and no Supplemental Order will be issued.
IT IS FURTHER ORDERED that Idaho Power file,as soon as available,final
exhibits as set forth in its Application.
IT IS FURTHER ORDERED that the foregoing authorization is without prejudice to
the regulatory authority of this Commission with respect to rates,utility capital structure,service,
accounts,evaluation,estimates for determination of cost or any other matter which may come before
this Commission pursuant to its jurisdiction and authority as provided by law.
IT IS FURTHER ORDERED that nothing in this Order and no provisions of Title 61,
Chapter 9,Idaho Code,or any act or deed done or performed in connection therewith shall be
construed to obligate the state of Idaho to pay or guarantee in any manner whatsoever any security
authorized,issued,assumed or guaranteed under the provisions of said Title 61,Chapter 9,Idaho
Code.
PROPOSED ORDER -4
DONE BY ORDER of the Idaho Public Utilities Commission at Boise,Idaho this
day of March,2002.
PAUL KJELLANDER,President
DENNIS HANSEN,Commissioner
MARSHA H.SMITH,Commissioner
ATTEST:
Jean D.Jewell
Commission Secretary
PROPOSED ORDER -5