ML20086K102

Forwards Util 840116 Press Release Explaining Financial Reasons for Halting Facility Const.Certificate of Svc Encl

ML20086K102
Person / Time
Site:	Marble Hill
Issue date:	01/20/1984
From:	Voight H, Voigt H LEBOEUF, LAMB, LEIBY & MACRAE, PSI ENERGY, INC. A/K/A PUBLIC SERVICE CO. OF INDIANA
To:	Linenberger G, Paris O, Smith I Atomic Safety and Licensing Board Panel
References
NUDOCS 8401260223
Download: ML20086K102 (6)

Text

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LEBOEU F, LAM B, LElBY aggRAE A PARTNERsMlP iNCLuDiMG PeoFEssaQNAL ConPomatp6 1333 Ncw HAMPSHIRE AVENUE, N.W.

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Smith, Esq.

Mr. Gustave A.

Linenberger Atomic Safety and Licensing Atomic Safety and Licensing Board Panel Board Panel U.S. Nuclear Regulatory U.S. Nuclear Regulatory Commission Commission Washington, D.C.

20555 Washington, D.C.

20555 Dr. Oscar H.

Paris Administrative Judge Atomic Safety and Licensing Board U.S. Nuclear Regulatory Commission Washington, D.C.

20555 Re:

Public Service Company of Indiana, Inc., Wabash Valley Power Association, Inc. (Marble Hill Nuclear Generating Station, Units 1 and 2) Docket Nos. 50-545 and 50-547

Dear Sirs:

I enclose copies of a press release issued by Public Service Company of Indiana, Inc. on January 16, 1984.

I believe that the press release is self-explanatory.

I will keep you advised of further developments.

Sincerely, 8401260223 840120 gr

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PDR Harry H Voigt Attorney for Applicants 49

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.DOWS 957 contact:

Julie A. VanUtt Plainfield (317) 838-1445 l

or (317) 872-7267 after 5:30 p.m.

For Inmediate Release:

January 16, 1984 Public Service Indiana Unable to Proceed with Marble Hill Public Service Indiana's board of directors announced today that the ccrupany is financially unable to proceed further with construction of the Marble Hill nuclecr generating station. he board also reduced the quarterly dividend on the ccupany's ccmuon stock by 65 percent-cutting it from 72 cents to 25 cents per share. In other action, the txaard directed the c.u@Ty to file an irmediate petition with the state Public Service Ccmnission for c; proximately $105 million in emergency rate relief, m e board also authorized preparation of rate cases, distinct frcm the petition for emergency rate relief, to request recovery of its Marble Hill investment over a period of years.

"Even with the most stringent internal cost controls, we have not been able to generate a sufficient anount of cash to continue to operate cur system, much less to finance construction at Marble Hill," ccxrpany Chairman Hugh A. Barker said today.

Barker pointed out that the company's employment outside its Nuclear Division has been reduced by 539 people since June 1982.

" Reducing non-nuclear employment by 11 percent--despite a greater volume of business to be served-and operating in 1983 at the 1982 operation and maintenance budget level...none of these indicates ' business as usual,'" Barker said.

He also pointed to the recent vote by IB M Local 1393 to extend its current contract, with no wage or benefit increases in 1984, as evidence of cost control by the ccreany and

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Events of PSI's market price il by more than $

coupany. Owners in the stock in PSI.

own pred dramatic deep common shares fall the l-k%;~~

recent residents of their brokers, or own ot) of the Indiana value through

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least names, haveMany other Hoosierss companies d " Barker and similar own in their a%..~

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this less common company's i ns, the board conble Hill rate had been controly en theIn its deliberat oof completing Mar delay in the eri r's

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After analyzing the coupany's current cash needs and financial position, the board i

I determined that Public Service Indiana's ability to provide an &;c@ table level of service to its customers will be inpaired unless the ca pany is able to generate more cash.

Barker said that the twgwiy must hanediately reduce maintenance expenses to the Iowest possible level, even though this action could result in a less reliable level of service to customers, until the emergency rate increase is granted. The capany is also studying other ways to conserve cash.

"Ber-anaa of these concerns about maintaining an acceptable level of service, on Jan.

9 we asked the Public Service Canaission for approval to seek short-term financing from 3

banks," Barker said.

"But potential lenders have made it clear that even this type of capital can be secured only after they receive assurances of adequate rate relief." She c apany's petition for emergency relief seeks a 14 percent increase.

It will be filed today.

In addition to these measures to conserve cash, the c mpany must be allowed to recover its investment in' Marble Hill over a reasonable period of time in order to be t

financially viable and to have access to the capital markets. The ccupany will prmptly i

begin the preparation of rate cases requesting an increase in rates to + n vlish this.

Testimony in these cases is not expected to be filed until this sunmer.

i The dividend of 25 cents per share on the empany's emmon stock was declared payable en March 1, 1984, to shareholders of record on Feb. 14, 1984. The board also authorized payment of regular quarterly dividends on preferred stock at contractual rates, also payable March 1 to shareholders of record on Feb. 14.

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UNITED STATES OF AMERICA DOLKETED NUCLEAR REGULATORY COMMISSION UWC BEFORE THE ATOMIC SAFETY AND LICENSING BOAR 2'84

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LFF 'Li 7 3 R" A'",.

In the Matter of

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00CntiinG A SEP

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ERANCH PUBLIC SERVICE COMPANY

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Docket Nos. STN 50-546 OF INDIANA, INC.

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STN 50-547

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WABASH VALLEY POWER

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' ASSOCIATION, INC.

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(Marble Hill Nuclear

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Generating Station,

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Units 1 & 2)

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CERTIFICATE OF SERVICE I hereby certify that-I have this 20th day of January, 1984, served copies of the foregoing document by mailing first class, postage prepaid and properly addressed, copies thereof to the following:

Ivan W.

Smith, Chairman Gustave A. Linenberger Atomic Safety and Licensing Atomic Safety and Licensing Board Panel Board Panel U.S. Nuclear Regulatory U.S. Nuclear Regulatory Commission Commission Washington, D.C.

20555 Washington, D.C.

20555 Dr. Oscar H. Paris Elaine I.

Chan, Esq.

4 Atomic Safety and Licensir.g Office of Executive Legal Board Panel Director U.S. Nuclear Regulatory U.S. Nuclear Regulatory Commission Commission Washington, D.C.

20555 Washington, D.C.

20555 l

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Docketing and Service Section Office of the Secretary U.S. Nuclear Regulatory Commission 20555 rr.

Washington, D.C.

Tom Zeller E'

The Indiana Sassafras Audobon Vice President Valley Watch, Inc.

Society P.O. Box 2262 Evansville, Indiana'47714 c/o Mary Kay Moody 3;

6620 E. State Road 45 47401 El Bloomington, Indiana Fred Hauck

=:2 g.i Save the Valley Dr. tiarold G. Cassidy

1. 3, Tower Heights e 5.

605 West Second Street Shelbyville, Kentucky 40065 ik[$

R.R.

Save the Valley 1v.gi; 47250 PEi.

Madison, Indiana 55 Rs W

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Harr{H.Voigt, Egg.

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LeBoeuf, Lamb, Leiby & MacRae 1333 New Hampshire Ave., N.W.

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20036 f*E Washington, D.C.

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(202) 457-7500 Attorneys for Public Service i.

Company of Indiana, Inc.

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