Your PUD News Release
PUD commissioners approve backup financing options
Chelan County PUD
News Release
10/13/2008
Updated Oct. 14:
Tuesday morning, commissioners approved a funding option to use short-term notes as a backup financing tool in case financial markets don’t recover soon.
This proactive measure was recommended by staff Monday as an alternative to bonds to finance up to $75 million in planned work at Rock Island Dam and to refinance around $93 million in variable rate bonds in case the bond market remains volatile.
Chelan County PUD commissioners Monday were asked to approve a backup financing tool in case financial markets don’t recover soon. Commissioners planned to continue the discussion at 8 a.m. Tuesday morning to consider approval for the PUD to issue short-term notes as a way to borrow funds if needed.
As a proactive measure, PUD Treasurer Debbie Litchfield and General Manager Rich Riazzi recommended that commissioners authorize the option to use notes as an alternative to bonds to finance up to $75 million in planned work at Rock Island Dam and to refinance around $93 million in variable rate bonds in case the bond market remains volatile.
While notes are similar to bonds, they are more attractive in today’s market as they normally have much shorter terms –sometimes six months to a year.
Riazzi emphasized that the PUD is still financially strong and added, “We’re trying to maintain control of our destiny by having these options in place.”
Staff had already planned to issue new debt this fall, in the form of bonds, to finance planned modernization work at Rock Island Dam. Current long-term power contracts require that capital work at Rocky Reach and Rock Island be financed through debt. If markets are favorable this fall, bonds will likely be issued. However if the bond market is not favorable, the District may issue notes for Rock Island Dam capital.
Commissioners will be asked Oct. 20 to approve issuing new bonds this fall to finance the Rock Island work and refinance other bonds for savings, with hopes that the bond market becomes more attractive to investors.
In other business, PUD commissioners:
- Heard from Beth Stipe, the executive director of the Community Foundation of North Central Washington, on their new Web site detailing social and economic trends in Chelan and Douglas counties. The new site will debut in early November and will help local agencies and businesses plan better for growth and future programs.
- Changed the start time to 9 a.m. for the Nov. 3 commission meeting. A preliminary 2009 budget will be introduced to commissioners at 10 a.m.
- Heard that staff is meeting with industrial customers at 5:30 p.m. on Oct. 16, in the PUD Auditorium to discuss rate changes that could go into effect in 2009.
- Reviewed a resolution responding to the 2003 federal Fair and Accurate Credit Transaction Act, or “FACT Act,” which requires utilities to maintain an identity-theft-protection program to protect customer account information. Commissioners will be asked to consider authorizing a program Oct. 20.
- Adjourned to continue the meeting to 8 a.m. on Tuesday, Oct. 14, in the boardroom to continue discussing PUD finances.
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The next regular meeting of the PUD commission is at 11 a.m. on Monday, Oct. 20, in the boardroom at PUD headquarters, 327 N. Wenatchee Ave. The public hearing for potential rate changes will begin at 1 p.m.
Most PUD commission meetings are recorded and a link to the audio is available on the PUD’s home page at www.chelanpud.org.
Christy Shearer
Communications Audio-visual Specialist
Chelan County PUD
(509) 661.4258 office
(509) 421.4258 cell
(509) 661.8133 fax
christy.shearer@chelanpud.org