28847.doc

BEFORE THE IDAHO PUBLIC UTILITIES COMMISSION

in the matter of AVISTA CORPORATION FOR AN ORDER AUTHORIZING THE ISSUANCE AND SALE OF UP TO 10,000,000 SHARES OF COMMON STOCK WITHOUT PAR VALUE )
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CASE NO. AVU-U-01-01

ORDER NO. 28847

In Order No. 28410 issued June 15, 2000, the Commission authorized Avista Corporation to issue up to 3,700,000 shares of common stock without par value. In an Application filed August 6, 2001, Avista requests authority to increase the number of shares of common stock authorized but not issued from 3,700,000 shares to 10,000,000. The Company also requests authority to increase the fees paid to persons other than attorneys and accountants as part of such transactions. After reviewing the Application, the Commission approves the Application.
THE APPLICATION
Avista’s present Application to increase the number of authorized but unissued shares of common stock to 10,000,000 would allow Avista to offer both this year’s and next year’s planned shares for issuance when the markets become favorable. The current capital markets for utilities in the western United States makes this option more desirable. Avista states that the net proceeds will be used: (a) to retire or exchange one or more outstanding stock, bond, or note issuance; (b) to fund Avista’s construction, facility improvement, and maintenance programs; (c) to reimburse the treasury for funds previously extended; or (d) for such other purposes that may be permitted by law.
Avista also requests authority to increase the fees paid to persons other than attorneys and accountants as part of such securities transactions. Avista requests that the fee limit be increased from 2.5% to 6%. With current market conditions, the expedited issuance of shares may be preferable. This shortened time-frame would require higher fees. The Company asserts that no person has received or will be entitled to receive from the Application any fee: (1) for services in connection with the consummation of the issuance and sale of the above-referenced securities, other than fees for legal, accounting or similar professional or technical services; or (2) for services in securing underwriters, sellers, or purchasers of common stock.
Avista asserts that all other provisions of Order No. 28410 will remain the same. More specifically, the authority for issuance of the request of common stock will be effective for a period of five years from June 15, 2000 —the date of Order No. 28410. This period will remain in effect as long as Avista’s secured bond ratings do not fall more than three rating levels below Avista’s rating level of BBB+ for Standard & Poor and A3 for Moody’s.
FINDINGS OF FACT
The Commission has jurisdiction over this Applicant and this Application in accordance with Idaho Code, Title 61, Chapters 1 and 9.
The Applicant requests that the Commission modify the terms of its Order No. 28410 dated June 15, 2000, to increase the amount of shares authorized but unissued common stock without par value from 3,700,000 shares to 10,000,000 shares.
The Commission finds that change in market conditions necessitate that the Applicant be permitted to offer both this year’s and next year’s planning shares for issuance when markets become favorable.
The Commission also finds that the proceeds will be used: (a) to retire or exchange one or more outstanding stocks, bonds, or note issuances; (b) to fund Avista’s construction, facility improvement, and maintenance programs; (c) to reimburse the treasury for funds previously expended; or (d) for such other purposes as may be permitted by law.
The Commission also finds it is reasonable for the Applicant to increase the fee limit paid to persons other than attorneys and accountants involved in the issuance of the Company’s securities from 2.5% to 6%.
The Commission further finds that no person shall receive or will be entitled to receive from the Applicant any fee: (1) for services in connection with the consummation of the issuance and sale of the above-referenced securities; other than fees for legal, accounting or similar professional or technical services; or (2) for services in securing underwriters, sellers, or purchasers of common stock.
With the above-referenced changes, the Commission finds that the other provisions of Order No. 28410 issued June 15, 2000 shall and will remain the same. The Applicant is authorized to issue and sell the above-referenced securities for a period of five years from June 15, 2000 (the date of Order No. 28410). This period shall remain effective as long as Avista’s secured bond ratings do not fall more than three rating levels below Avista rating level of BBB+ for Standard & Poor and A3 for Moody’s.
The proposed issuance and sale of common stock are for lawful purpose and are within the Applicant’s corporate powers. The proposed transaction is in the public interest, and a formal hearing on this matter would serve no public purpose.
All fees have been paid by applicant in accordance with Idaho Code § 61-905.

O R D E R
IT IS THEREFORE ORDERED that the Application of Avista Corporation to modify certain provisions of Order No. 28410 is granted. The Company is authorized to issue and sell up to and including 10,000,000 shares of authorized but unissued common stock without par value.
IT IS FURTHER ORDERED that the Applicant is permitted to increase the fee limit for persons other than attorneys and accountants from 2.5% to 6%. No person shall be entitled to receive from the Applicant any fee: (1) for services connected with the consummation of the issuance and sale of the above-referenced securities, other than fees for legal, accounting or similar professional or technical services; or (2) for services in securing underwriters, sellers, or purchasers of common stock.
IT IS FURTHER ORDERED that nothing in this Order shall be construed to obligate the State of Idaho to pay or guarantee in any manner whatsoever any security authorized, issued, assumed, repurchased, defeased, or guaranteed under the provisions of this Order.
IT IS FURTHER ORDERED that this authorization is without prejudice to the regulatory authority to this Commission with respect to rates, services, accounts, evaluations, estimates, or determination of costs, 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 the issuance of this Order does not constitute acceptance of Avista Corporation’s exhibits or other materials that accompany this Application for any other purpose other than the issuance of this Order.
THIS IS A FINAL ORDER. Any person interested in this Order (or in issues finally decided by this Order) or in interlocutory Orders previously issued in this Case No. AVUU0101 may petition for reconsideration within twenty-one (21) days of the service date of this Order with regard to any matter decided in this order or in interlocutory Orders previously issued in this Case No. AVU-U-01-01. Within seven (7) days after any person has petitioned for reconsideration, any other person may cross-petition for reconsideration. See Idaho Code § 61626.
DONE by Order of the Idaho Public Utilities Commission at Boise, Idaho this _______ day of September 2001.

PAUL KJELLANDER, PRESIDENT

MARSHA H. SMITH, COMMISSIONER

DENNIS S. HANSEN, COMMISSIONER

ATTEST:

Jean D. Jewell
Commission Secretary

vld/O:AVU-U-01-01_dh

ORDER NO. 28847 1

Office of the Secretary
Service Date
September 13, 2001