20220825Application.pdf

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Lori A. Blattner
Director, Regulatory Affairs
lntermountain Gas Company
Enclosure
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Preston Carter
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August 25,2022
Ms. Jan Noriyuki
Commission Secretary
Idaho Public Utilities Commission
P.O. Box 83720
Boise, ID 83720-0074
RE: Case No. INT-G-22-06
Dear Ms. Noriyuki:
Attached for consideration by this Commission is an electronic submission of Intermountain Gas
Company's Application to Renew and Increase a Revolving Credit Agreement. The Application
requires an IPUC lssuance Fee in the amount of $1,000. That check will be hand-delivered under
separate cover later today.
If you should have any questions regarding the attached, please don't hesitate to contact me at (208)
377-60t5.
Sincerely
INTERMOT]NTAIN GAS COMPAIYY
CASE NO.INT-G-22.06
APPLICATION
AI\[D
E)ilIIBITS
In the Matter of the Application of INTERNIOUNTAIN GAS COMPAI\IY
for Authorization to Renew and Increase a Revotving Credit Agreement
Preston N. Carter, ISB No. 8462
Givens Pursley LLP
601 W. Bannock St.
Boise, lD 83702
Telephone: (208) 388- I 200
Attorney for Intermountain Gas Company
BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION
ln the Matter of the Application of
TNTERMOUNTAIN GAS COMPANY
for Authorization to Renew and Increase
a Credit
Intermountain Gas Company ("lntermountain" or "Company"), a subsidiary of MDU
Resources Group, Inc. with general offices located at 555 South Cole Road, Boise, Idaho, pursuant
to the applicable statutes, including Idaho Code Sections 6l-901, 6l-902,61-903 and 6l-905, and the
Rules and Regulations of the ldaho Public Utilities Commission ("Commission"), requests
authorization to renew and increase a Revolving Credit Agreement to One Hundred Million
($100,000,000) not to exceed a five (5) year period with an option to borrow an additional Twenty
Five Million Dollars ($25,000,000) for the same timeframe, or One Hundred and Twenty-Five
($125,000,000) in total. The renewal would occur between the months of October and December
2022.
Communications in reference to this Application should be addressed to:
Lori A. Blattner
Director - Regulatory Affairs
Intermountain Gas Company
Post Office Box 7608
Boise,ID 83707
Lori.B lattner@ intgas.com
and
Preston N. Carter
Givens Pursley LLP
601 W. Bannock St.
Boise,lD 83702
prestoncarter@ q i venspurs ley.com
stephaniew@ei
Case No. INT-G-22-06
APPLICATION
APPLTCATION. I
vensnurslev.com
In support of this Application, Intermountain alleges and states as follows:
I.INTRODUCTION
Intermountain is a gas utility, subject to the jurisdiction of the ldaho Public Utilities
Commission, engaged in the sale of and distribution of natural gas within the State of Idaho under
authority of Commission Certificate No. 219 issued December2,l955, as amended and
supplemented by Order No.6564, dated October 3,1962.
Intermountain provides natural gas service to the following Idaho communities and counties
and adjoining areas:
Ada County - Boise, Eagle, Garden City, Kun4 Meridian, and Star;
Bannock County - Arimo, Chubbuclq lnkom, Lava Hot Springs, McCammon, and Pocatello;
Bear Lake County - Georgetown, and Montpelier;
Bingham County - Aberdeen, Basalg Blackfoot, Firttr, Fort Hall, MorelandlRiverside, and Shelley;
Blaine County - Bellevue, Hailey, Ketchum, and Sun Valley;
Bonneville County - Ammon,Idaho Falls,Ion4 and Ucon;
Canyon County - Caldwell, Greenleaf, Middleton,N*pq Parm4 and Wilder;
Caribou County - Bancroft, Grace, and Soda Springs;
Cassia County - Burley, Declo, Malta and Raft River;
Elmore County - Glenns Ferry, Hammett and Mountain Home;
Fremont County - Parker, and St. Anthony;
Gem County - Emmett;
Gooding County - Bliss, Gooding, and Wendell;
Jefferson County - Lewisville, Menan, Rigby, and Ririe;
Jerome County - Jerome;
Lincoln County - Shoshone;
Madison County - Rexburg, and Sugar City;
Minidoka County - Heyburn, Paul, and Rupert;
Owyhee County - Bruneau, Marsing, and Homedale;
Payette County - Fruitland, New Plymouth, and Payeffe;
Power County - American Falls;
Twin Falls County - Buhl, Filer, Hansen, Kimberly, Murtaugh, and Twin Falls;
Washington County - Weiser.
lntermountain's properties in these locations consist of transmission pipelines, liquefied
natural gas storage facilities, compressor stations, distribution mains, services, meters and regulators,
and general plant and equipment.
II. DESCRIPTION OF SECT]RITIES
Commission OrderNo. 34303, Case No INT-G-I9-02, granted Intermountain the authorrty to
renew its revolving credit agreement up to $l 10,000,000 not to exceed a five-year period. Applicant
seeks authority from this Commission to renew and increase a Revolving Credit Agreement to One
APPLICATION - 2
Hundred Million Dollars ($100,000,000) not to exceed a five (5) year period with an option to borrow
an additional Twenty-Five Million Dollars ($25,000,000) for the same timeframe, or One Hundred
and Twenty- Five Million Dollars ($125,000,000) in total.
The Board of Directors of Intermountain has duly authorized the renewal and increase of the
Revolving Credit Agreement. A copy of the Resolution is attached hereto as Exhibit No. I and is
incorporated by reference.
The estimated terms and conditions of the Revolving Credit Agreement are incorporated by
reference.
Summarv of Terms and Conditions for Revolving Credit Aereement
Borrower: Intermountain Gas Company
Lender:A syndicate of fnancial institutions ananged by U.S. Bank
National Association and Wells Fargo Securities, LLC.
Principal Amount:Revolving Credit Agreement - $100,000,000, which will
include a $15 Million sublimit for standby letters of credit and
a $5 Million sublimit for swingline loans. The Borrower has
the right to borrow an additional $25,000,000 subsequent to
the Closing date up to an aggregate amount not to exceed $125
Million.
Interest Rates At the Borrower's option, any loan under the credit facility
will bear interest at a rate equal to (i) SOFR plus the
Applicable Margin, as determined in accordance with the
Performance Pricing grid set forth below or (ii) the base rate
(to be defured as the highest of (a) the U.S. Bank prime rate,
(b) the Federal Funds rate plus .50Yo and (c) a daily rate equal
to one-month SOFR plus 1.00%.
Date of Renewal:
Maturity:
Voting Privileges:
Call or Redemption
Provisions:
Sinking Funds or Other
Provisions for Securing
Payment:
Between the months of October and Decem&r2022.
Up to five (5) years from the execution and delivery of
definitive documentation for the Senior Credit Facility.
None
Not Applicable
APPLICATION. 3
None
Security:
Use of Proceeds:If approved, the Revolving Credit Agreement will be used to
provide for capital expenditures, deferred gas costs, and for
general corporate purpose needs of lntermountain.
Fees:Annually, beginning at the time of closing and each year on
the anniversary date of the credit facility, the Borrower will
pay an Administative Fee of approximately $15,000 to U.S.
Bank, National Association.
The Borrower will pay a fee determined in accordance with
the estimated Performance Pricing grid set forth below, on the
actual daily unused amount of each Lender's commitment.
The Facility Fee is payable quarterly in arrears, commencing
on the first quarterly payment date to occur after the Closing
Date.
Other Requirements:Costs associated with this transaction are to be paid by
Intermountain as noted in the above delineation of o'Fees."
m. STATEMENT OF INT'ORMATION REQIIIRED By RIILE r4r.03
The Revolving Credit Agreement will be issued to a syndicate of financial institutions
arranged by U.S. BankNational Association and Wells Fargo Securities, LLC (the "Agents"). The
net proceeds for the Revolving Credit Agreement are up to One Hundred Million Dollars
($100,000,000) plus the option to borrow an additional Twenty-Five Million ($25,000,000). The
estimated fees discussed below do not reduce the amount the Company is able to borrow.
The estimated fees and expenses of the renewal of the Revolving Credit Agreement are
expected to total up to Four Hundred Thousand Dollars ($450,000) consisting of the following:
Arrangement and Syndication Fees $300,000
Legal Fees 150.000
None
Pricing
Level
Indebtedness to
Capitalizafi6a f,s1is Facility
Fee
sox'R
Advances/Letter of
Credit Fee
Base Rate
Advances
I > 0.60:1.0 0.30o/o 1.550o/o 0.450o/o
II >0.55:1.0 but < 0.60: 1.0 0.225o/o 1.375o/o 0.2750/o
III >0.45:1.0 but <0.55: 1.0 0.175o/o l.l75o/o 0.075o/o
IV < 0.45:1.0 0.125o/o l.l00o/o 0.000o/o
APPLICATION.4
Total $450.000
TV. STATEMENT OF PURPOSE
Based on this Commission's authorization, the Revolving Credit Agreement will be used to
provide for capital expenditures, deferred gas costs, and for general corporate purpose needs of
Intermountain.
V. STATEMENT OF DPLANATION
These uses are consistent with the public interest and necessary, appropriate, and consistent
with the proper and legally mandated performance to the public by Intermountain as a public utility.
VI. FINAI\ICIAL STATEMENT
Intermountain's Statement of Capitalizationas of June 30,2022, showing all authorized and
outstanding classes of securities, is as follows:
June30,2022
Actual
Amount
Outstanding
($000's)
Common Stock &
Surplus
Long Term Debt
Total Capitalization
VII. PROPOSED ORDER
A proposed Order granting this Application is attached as Exhibit No. 2 and is incorporated
by reference.
$ 193,349
190.703
$384052
Ratio
50.3%
49.7%
1000%
APPLICATION.5
VItr. STATEMENT OF PTIBLIC NOTICE
Notice of the application will be published within seven days of the filing date of this
Application in The ldaho Business Review, The ldaho State Journal, The ldaho Statesman, The Post
Register, and The Times News pursuant to Rule 141.08 of the Commission's Rules of Procedure.
IX. VERIFIED REPORT
A copy of the verified report for the above referenced Revolving Credit Agreement showing
the amount realized including the itemized costs and expenses incurred in connection with this
transaction will be submiued under separate cover after renewal and is to be treated as confidential
pursuant to the Commission's Rules of Procedure IDAPA 31.01.01.067 and 31.01 .01.233, together
with Idaho Code $$ 74-104, 106, 107, and 48-801 et seq.
X. COMI\ISSION FEE
The fee required by Section 6l-905 ofthe tdaho Code, was determined as follows:
First
Next
Remaining
$ 100,000 at $1.00 per $1,000
900,000 at $0.25 per $1,000
124.000.000 at $0.10 per $1,000s 12s.000-000
:$ 100= 225= 12.400
=$J2JE
As this amount is larger than the $ I ,000 maximum fee set forth in Section 6 I -905 of the Idaho
Code, a check for $1,000 is enclosed with this Application.
XI. MODIFIED PROCEDURE
lntermountain requests that this matter be handled under modified procedure pursuant to
Rules 201-204 ofthe Commission's Rules of Procedure. lntermountain stands ready for an immediate
hearing of this Application if such is determined necessary by this Commission.
XII. REQTIEST FOR RELIEF
Intermountain respectfully petitions the Idaho Public Utilities Commission as follows:
l) That this Application be processed without hearing pursuant to the Rules and
Regulations of this Commission and acted upon at the earliest possible date;
2) That this Commission approve and authorize the renewal and increase of a Revolving
Credit Agreement to One Hundred Million Dollars ($ I 00,000,000) not to exceed a five (5) year period
APPLICATION - 6
with an option to borrow an additional Twenty-Five Million Dollars ($25,000,000) for the same
timeframe, or One Hundred Twenty-Five Million Dollars ($125,000,000) in total;
3) That this Commission allow Intermountain to manage the Revolving Credit
Agreement pursuant to the order issued in this matter until such time as Intermountain's Board of
Directors changes the authorized level of such Revolving Credit Agreement, with Intermountain
making quarterly reports to this Commission setting forth the date of issuance, principal amount
interest rate, date of maturity and identity of payee for all promissory notes issued during such quarter;
and
4) For such other relief as this Commission may determine is just and proper.
DATED: August 25,2022.
INTERMOUNTAIN GAS COMPA}.IY GIVENS PURSLEY LLP
By
Lori A. Blattner
Director - Regulatory Affairs
By
Preston N. Carter
Attorney for Intermountain Gas Company
dnLBLM
APPLICATION - 7
EXIIIBIT NO. 1
CASE NO.INT.C,-2246
INTERMOI]NTAIN GAS COMPAI\TY
BOARD RESOLUTION
(2 pases)
CERTIFICATE
I, Allison Waldon, hereby certifu that I am the duly elected and qualified Assistant
Secretary of Intermountain Gas Company, an Idaho corporation; that the following is a true and
correct copy of resolutions adopted by Written Consent of the Board of Directors dated July 26,
2022; and that said resolutions have not been modified or amended and are presently in full force
and effect:
WHEREAS, the Board of Directors of Intermountain Gas Company (the
"Company") has determined that it is desirable for the Company to enter into a
revolving credit agreement whereby the lenders would make revolving loans to the
Company, from time to time, in amounts up to the aggregate principal amount of One
Hundred Twenty-Five Million Dollars ($125,000,000), for a period not to exceed
five years (the "Credit Agreement");
NOW, THEREFORE, BE IT RESOLVED, thatthe Chairof the Board, Chief
Executive Offrcer, President, any Vice President, General Counsel, Confioller,
Tneasurer or any other officer who performs a policy-making function (such as
administration, operations, accounting, or finance) of the Company (the "Authorized
Officers") be, and each of them hereby is authorized to (D negotiate, execute and
deliver a Credit Agreement, with such terms and provisions as the Authorized Oflicer
executing the Credit Agreement on behalf of the Company shall deem proper, and (ii)
in connection with such Credit Agreement, execute and deliver promissory notes in
an aggregate principal amount up to $125,000,000 (the "Promissory Notes'), such
execution by the Authorized Offrcer of the Credit Agreement and the Promissory
Notes to be conclusive evidence of the Authorized Officer's authority granted herein
and the approval thereof by the Board of Directors;
FURTHER RESOLVED, that each and every officer of the Company be,
and hereby is, authorized and empowered, in the name and on behalf of the
Company from time to time, to take such actions and to execute and deliver such
agteements, certificates, instruments, notices and documents as may be required or
as such offrcer may deem necessary, advisable, or proper in order to carry out and
perform the obligations of the Company under the Credit Agreement, the
Promissory Notes, and any other agreements executed by the Company pursuant to
these resolutions; and all such actions to be performed in such manner, and all such
agreements, certificates, instruments, notices, and documents to be executed and
delivered in such form as the officer performing or executing the same shall
approve, the performance or execution thereof by such officer to be evidence that
such officer deems all of the terms and provisions thereof to be proper; and
FITRTI{ER RESOLVED, that all las-&l actions previously taken in good
faith by any offioer of the Company in anticipation of, or in conneotion with, the
foregoing are hereby approved, ratified and confirmed in all respects as if such
actions had been presented to the Board of Directors for its approval prior to such
actions bemgtaken.
IN WITNESS WHEREOF, I have hereunto set my hand on August 12,2022.
Allison Waldon, Assistant Secretary
2
EXHIBTT NO.2
CASE NO.IN[.GA246
INTERMOT]NTAIN GAS COMPAI\IY
IDAHO PUBLIC UTILITIES COMMISSION
PROPOSED ORDER
(3 page)
PROPOSED ORDER OF APPLICAI\T
BEFORE THE DAHO PUBLIC UTILITIES COMMISSION
In the Matter of the Application of
TNTERMOUNTAIN GAS COMPANY
for Authorization to Renew and Increase
Case No. INT-G-22-06
ORDER NO.
a Credit
OnNovember23,202l,[ntermountain Gas Company (the "Compily"), a subsidiary ofMDU
Resources Group,Inc., appliedto the Commission under ldaho Code $$ 6l-901, et seq. forauthority
to renew and increase a Revolving Credit Agreement to $100,000,000, not to exceed a five-year
period, with an option to borrow an additional $25,000,000 for the same time frame, or $125,000,000
in total. Having fully considered the Application, the Commission enters this Order granting it as
follows.
TITE APPLICATION
The Company asks for authority to renew and increase a revolving credit agreement up to
$125,000,000. The proposed Revolving Credit Agreement would exist for a period not to exceed five
years from the date of execution and delivery of the credit agreement. The interest rate will either be
based on SOFR plus an applicable margin or the base rate, which is the higher of the U.S. Bank prime
rate, the Federal Funds rate plus 0.50o/o, or a daily rate equal to one-month SOFR plus 1%. The
Company says it will use the Revolving Credit Agreement to provide for capital expenditures,
deferred gas costs, and for general corporate purposes.
The Company anticipates arrangement, syndication, and legal fees necessary to complete
the renewal of the Revolving Credit Agreement to total up to $450,000, which will not reduce the
amount the Company is able to borrow.
COMN/flSSION FINDINGS AND DECISION
The Company is an Idaho corporation with its office and principal place of business in Boise,
Idaho. It is a natural gas public utility that owns and operates transmission pipelines, liquehed natural
gas storage facilities, compressor stations, distribution mains, services, meters and regulators, and
ORDER NO.PAGE I
general plant and equipment. It is a gas corporation and public utility as defured in ldaho Code $$
6l-117 and6l-129.
The Commission has jurisdiction over the Application under ldaln Code $ 6l-901, et seq.
We find that the proposed transaction is in the public interest and a formal hearing on this matter is
not required. We further find that the proposed tansaction is for a lawful purpose and is within the
Company's corporate powers, that the Application reasonably conforms to Rules 14l through 150 of
the Commission's Rules of Procedure, IDAPA 31.01.01-l4l-150, and thatthe Company has paid all
fees due rnder ldaho Code $ 6l-905. Accordingly, we find that the Application should be approved,
and the proposed financing should be allowed.
The Commission's Order approving the proposed financing and the general purposes to which
the proceeds may be put is not a determination that the Commission approves of the particular use to
which these funds will be put. This Order also is not a Commission determination or approval of the
type of furancing orthe related costs for ratemaking purposes. The Commission does not have before
it for determination, and so does not determine, the effect of the proposed transaction on rates the
Company will charge for natural gas service.
ORDER
IT IS FIEREBY ORDERED that the Company's Application for authority to renew and
increase its Revolving Credit Agreement to $100,000,000, not to exceed a five-year period, with an
option to borrow an additional $25,000,000 for the same time frame, or $125,000,000 in total is
granted.
IT IS FURTI{ER ORDERED that the Company must continue to file quarterly reports with
the Commission setting forth ttre date of issuance, principal amount interest rate, date of maturity and
identity of payee for all promissory notes issued during the quarter. The Company must continue to
file its capitahzation ratios with the quarterly reports.
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, valuation, estimates or determination of cost or any other matter which may come before
ttris Commission pursuant to its jurisdiction and authority as provided by law.
IT IS FURTHER ORDERED that nothing in this Order and no provisions of Chapter 9, Title
61, Idaho Code, or any act or deed done or performed in connection therewith shall be construed to
ORDER NO.PAGE 2
obligate the state of ldaho to pay or guarantee in any manner whatsoever any security authorized,
issued, assumed or guaranteed under the provisions of Chapter 9, Title 61, Idaho Code.
IT IS FLIRTFIER ORDERED that issuance of this Order does not constitut€ acceptance of the
Company's exhibits or other material accompanying the Application for any purpose other than the
issuance of this Order.
THIS IS A FINAL ORDER. Any person interested in this Order may petition for
reconsideration within twenty-one (21) days of the service date of this Order. Within seven (7) days
after any person has petitioned for reconsideration, any other person may cross-petition for
reconsideration. See ldaho Code $ 6l-626.
DONE by Order of the tdaho Public Utilities Commission at Boise, Idaho this
day of _2022.
PRESIDENT
COMMISSIONER
COMMISSIONER
ATTEST:
SECRETARY
ORDER NO.PAGE 3