ML20098C876
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{{#Wiki_filter:_ June 26,1975 T0: R. Cioni, NRC FROM: A. G. Hosler, WPPSS Jim Bobo informs me that you had some question about the $150 x 106 for the WNP-1 structures and improvements. I have attached a break-down of this number by contract. Also attached are breakdowns of other items included in Table 5-1 of the May 1975 financial data. One reason for our higher than expected cost of structures and improve-ments might be the size of the General Services Building. The volume of this building is much more than what has been provided for other plants; like 25% larger than the next smallest building we have found. a4 /w Alan G. Hosler Licensing Engineer WPPSS AGH:km l l 8409270253 840824 PDR FOIA PDR COHEN 84-603 m
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I* jty9 10-0-13 imm " U. .nw Fer n w gw t l f> SJ8sact : u)MP-/.4 w wYlAtr/A. ( ) Na FROM 7 0. - J -7 Name A G Hoslef hme T. H. Cox U 2 If k f Me t-9-75' company or Deit. WPPSS Company or Dept. NRC SUBJECT ($) DISOUssED FINANCING FOR kNP-4 REMARKS I told Tom that I had some infomation to relate relative to the financing for llHP-4. I emphasized that what I had to say only affects h"4P-4-- not HHP-li also this was more of a status report to aid the Staff in preparing for the Safety Hearing, in particular.to aid in the preparation of any testimony. In order to obtain pemanent financing for WNP-d. we need to have the participant ;'
. agreements signed.and we had hoped to have these agreements signed by the time -
of the hearing as reported to the Staff in our May 29. 1975, financial infomation submittal. These agreements are nc.1 not expected to be signed until May or June of 1976. The reason, and only reason, for the failure to obtain signed agreements is the requirement to complete secondary environe. ntal impact statements as required by a recent interpretation of the Washington SEPA. These impact statements are to address the local irpact of acquiring power to assist in meeting challenges like that recently experienced by Seattle City Light - that we had previously made Toa aware of. . I furthar explained that.until we obtain permanent financing for WNP-4,we are limited to expenditures of $100 x 106 for kHP-4 and S which was obtained under option agreements. Decause of the schedule differences, most of this money is available for lHP-4. This dollar limit presents a cash flow problem and also presents a problem of making certain that the 5100 million is sufficient to cover all' contracts, etc., including tennination charges. Of a particular problem is the ERDA contract for enrichment services which increases frca only a few Million to over,525 million upon receipt of a tenstruction Permit. He hope to caet this week with ERDA to discuss a proposed method of decreasing this liability. I stminarized our othat efforts to stretch the $100 million-- like renegotiate the EW centract. , I explained that the result of all of this was that within a few days we may need
- to send a letter to the NRC requesting that they ~ defer the review of the
. financial _qualif,ication for_HNP-I~forjhe present tificUh[is. Oti s Fitter not 9.belddressed_at_the Safety Hearing and, therefore, the Construction Pemit for
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WNP-4 be deterred.
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I reemphasized that this was all a status report;\that things could change, but we believed that with the Staff preparing financial testimony we were not in a position to put off notifying the Staff any longer. Tom said he agreed and wished we had notified him a few weeks ago. I responded that a few weeks ago we had hopes of resolving the problem ec: aletely and tthereby not be required to j iw.m . CC: Ne o ~ n . . . E '
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. id thaN,we had' a ineeting Friday with'ERDA we would be glad to meet with the I $f to discuss this problem. and even if the ERDA ceet.ing is not held, we un tec ill do anything we can to hold to the schedule we are currently on for tne
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FF SU"O* G em M N. NN / y) g ggn w ) Ys Sc) W : u)W-/.4 FROM 34R.6 /MMA. ( ) Nb To - Meme 'A. G. Hosier ' Mg b-+-27 hm T. H. Cox M2& G
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'UBJECT(S) 01SCUSSED FINANCING FOR WP-4 '
4EMARKS financing Ifor told Tom that I had some infomation to relate relative to the laiP-4. I emphasized that what I had to say only affects WP-4-- not WNP-1; also this was more of a status report to aid the Staff in preparing I , testimony. for the Safety Hearing, in particular to aid in the preparation of any
'In order to obtain pemanent financing for WHP-4, we need to have the participant ;' ' agreements signed.and we had hoped to have these agreements signed by the time -
- of submittal. the hearing as reported to the Staff in our f!ay 29. 1975, financial infomation June of 1976.
These agreements are ncs not expected to be signed until l'ay or-The reason, and only reason, for the failure to obtain signed
,agreemnts is the requirement to conplete secondary envirennental irpact statements as required by a recent interpretation of the Washington SEPA. These impact statements are to address the local impact of acquiring power to assist in meeting challenges like that recently experienced by Seattle City 1.ight -
that we had previously made Tom aware of. . I further explained that,until we obtain permanent financing for UNP-4 ua are limited to expenditures of 5100 x 106 aption agreements. for WP-4 and 5 which was obtained under Because of is available for WP-4. This doller limit presents the schedule differences, r:ost of this raney a cash flow problem cnd also dresents a probicm of making certzin that the 5100 million is sufficient to
- nvor all contracts, etc., including temination charges. Of a particular
.nchlem is the ERDA contract for enrichment services 5thich increases frc'a only few uillion to over,$25 million upon receipt of a Ccnstruction Permit. We ,his opeliability. to r.eet this week with ERDA to discuss a proposed method of decreasing
- ike renegotiate the I sumarized cur other efforts to stretch the $100 million--
EIN centract. explained that the result of all of this was that within a few days we may need o send a letter to the KRC requesting that they defer the revicw of the inancial qualification for WP-4 for the present time; that is, this catter not e addressed at the Safety Hearing and, therefom, the Construction Penait for NP-4 be deferred. .
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reemphasized that this was all a status report;\that things could change, but e believed that with the Staff preparing financial testimony we were not in a osition to put off notifying the Staff any longer.' Tom said he agreed and ished we had notified him a few weeks ago. I responded that a few weeks ago e had hepas of resolving the problem ccraletely and \thereby not be reouired tc a s a \- - a .. A R \ . 9 e i
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/ ktaff willto dodiscuss anything we thiscan problem, to hold to and the schedule even ifwe theareERDA currently meeting on for tneis not held, we lc I Safety Hearing. ~ Ua still strongly desire to, receive the Construction Pemit for unp.). in 1975. .c.d
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1 Agreement needed E 7.-J:u'- F on .% plant olids By JERRY PUGNT'l'Il Ught,which'has' backed ear . be produced by both plants. ' tier WPPSS bond issues, to. TNT City Holl Writer .
- underwrite the future issue TACO 31A'S LTILITY would / .,
' . Northwest pubhe utilities, would come from the Utility not be obligated to pay any including Tacoma City Board and ultimately the money unless the plants are Light, must agree by rnid- - City Council. not bmit. Then it would be 1976 to underwnte a future liable for its share o,f, the bondissueof more than $100 111E PROPOSED facili. bond issue.
*?When you have invested million to assure comtruc- ties include a $1.2 billion
. tion of two proposed nuclear plant at SatsopinGrays!Iar- $100 million m order to real-power plants. bor County and a $1. billion ize the benefit of that invest-
. Offictate of Washington plant at Hanford in East'ern ment, the plants must be ' ;
Public Power Supply Sys- Washington. . completed." said Benedetti,
- tem, which is proposing the City Light already has who sits on ihe WPPSS exec. .
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',J ,.. ,.;( F ~.' plants, said Monday the backed 11 per cent of a $100 utive'There
.,. commitistee. no question plants may be delayed or million bond , issue last
- cancelledif the93participat- month by WPPSS to finance about the need for the plants ing utihties do not commit the remaining prelimmary in order to meet the area themselves by that time. work o.n the plants. power load
- if the plants are not built, w Tacoma Utilities Director Any future bond issues Aldo J. Benedetti said he is would apply to actual con- Benedetti said, the North-west would face a power optimistic Tacome City struction of the plants.
Light and other utituies will Under the agreement, shortage b) the 1980s. Any agree to back the bond issues ~ City Ught would be entitled delays m the plant construc- J , by that time. to buy 11 per cent of the 1.24 tion would escalate costs 1
. . ; ",- The authority for City million kilowatts that would substantially, he added. - t.'.
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ovember 3,1975 Moody's Bond Surriey
- 673 aX- XemptS MOODTS MUNICIPAL BOND YlELD AVERAGES Oct. Oct. Oct. Oct. -mnthly- -1s74-7s-30 23 NIIIIISII! Com 16 7.32 s Oct. Sept. Esh Low Asa posite... 7.36 7.1s 7.s2 7.40 7.29 7.62 s.16
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- 660 6 44 6 60 6 80 6 67 6 60 C 92 4 s0 The effect of President Ford's speech on municipal in- ,
8 ff,,---- ,- M [si $f6 Es6 ks! EUo Ns $2s est rates was predictable. Yield indices moved higher at *** - ---- ---- .. s oo 7.so 7.s2 s.12 s.ot 7.as s_to s.4s e end of last week, reversing a three-week downward trend A [', "f,'*.5. s st s.7s s.s0 s.90 s.s4 s.si 6 is 4.t s sich continued into the beginning of last week. This came As _ s.96 s.so s.ss s43 s.ss s.si 6.2s 4.as o time when the prime rate of major banks continued For explanation of construction of me averases. see pose wnward from 8G to 7,75G , and some fell further, to 170s er January 27. asis, sono scavsv.
.30% on Friday. The Federal funds rate also dipped.
A $36 million offering by the Chicago Building Commis-
,et was cancelled because of the possible adverse effects of The $30,000,000 waterworks system revenue bonds are ! President's speech on the municipal market. MAC and secured by a pledge of revenues of the system, subject to the prior payment of current expenses, debt service on DC bonds traded down at the end of last week. There was outstanding senior lien bonds, deposits to the 1948 reserve itle tction in New York City bonds, and no new competitive > cs of large or medium.staed issues of New York local account. depreciation reserve fund and a deficiency make (its were reported. up pledge to the City's sewer revenue system. The system (The high-quality-bond market continued to function currently has S18,295,000 senior lien obligations issued . soothly. West Virginia bonds sold at a net interest cost of pursuant to the 1948 Resolution; the City has covenanted 98%, and only about 5% of the $50 million issue was un- not to issue any additional obligations under this resolution, < d en Fnday afternoon. Atlanta, Georgia, will pay only although additional junior lien panty bonds may be issued.
33% on its $8.0 million bonds, which is more than one In order to meet increasing water demands of the City, bond
.ndred basis points below the Bond Buyer Index. For its proceeds will be used for construction of the Morris Bridge t bond offering, Atlanta paid only 31 basis points less Well Field and Treatment Plant, including transmission im the Bond Buyer Index. mains to the City. In the past, the City has been reluctant txt week's volume of competitive issues totals $403.1 to raise water rates, but a substantially increased schedule will go into effect January 2,1976.
11 ion, featuring $100 million by the Commonwealth of ansylvania on Thursday. Rates are covenanted to produce revenues, less operating and maintenance costs, amounting to at Irast 120G of aggregate debt service requirements for the next fiscal year. 3w Issue Net revenues for 1974 of S3,4G5,000 cover maximum debt service of $4,176,903 in 1977 by 0.83 times. Estimated net
~ y cf Tampa, Florida rmnes f r 1976, under the new rate schedule, provide coverage of 1.73 times.
The City of Tampa will offer for bids on November 6, I4cated approximately midway down the Florida Penin-75, 519.000,000 special obligation excise tax bonds, Senes sula on the western coast, Tampa is primarily a commer-and $30,000,000 Tampa Watenvorks System revenue cial and service center for an important gulf coast metro-ids, Series A. Excise tax bonds are due October 1,1976- politan area. Convenient to such tourist attractions as tnd callable beginning in 1985 at 103. Waterworks reve- Disney World, Cypress Gardens, Busch Gardens, and Gulf r bonds are due September 1, 1977-2000, and are also Beaches, Tampa has a diversified economy and is not as
!!ble beginning in 1985 at 103.
dependent on resort activity as are many Florida com-the excise tax bonds now being issued are subordinate munities. Principal manufacturing lines include food and bonds issued under the 1957 Ordinance, currently out- kindred products, printing and publishing, fabricated metal (ding in the amount of $15,260,000. Debt service and products and tobacco products. The City provides an im-Emption premium, if any, on these junior lien and any portant trade function as reflected in 1972 retail sales per litiInal parity bonds issued is payable from all revenues capita of S4,304 at 3,416 retail establishments. Key eco-
.tved from the utilities service tax, subject only to the nomic indicators are slightly below Florida State urban
- r pledge to pay debt service and reserve requirements on medians with moderate population growth in the City. The standing senior lien bonds. The City has covenanted that :
Port of Tampa and Tampa International Airport provide the i additional bonds may be issued under the provisions of City with excellent transportation facilities. Due partly to *
' 1957 Ordinance. Additional parity junior lien bonds may diversity, the economies of Tampa and lillisborough County issued if the preceding year's utilfry service taxes less
- ximum debt service on outstanding senior lien bonds is have not been as sensitive to the economic slowdown in Florida especially as related to the construction industry. -
al to at least 135% of maximum debt service on out- Ilillsborough County has extensive phosphate mines, a di-2 ding and additional parity bonds. Bond proceeds of versified agricultural base including citrus products and is
*000,000 will be used to fund S3.810,000 in outstanding a major producer of tropical fish.
es and for construction of public buildings, fire depart-it facilities, street and storm sewer projects. Utilities In consideration of the increased water rate schedule to ! be effective January 2,1976, sound operating history and - rice taxes are levied on purchases of electricity, metered management, and the system's long range prospects in an ett!cd gas, water service and local telephone service. Tax expanding Tampa economy, Tampa Waterworks System - mues have steadily increased over the years, from $3,- junior lien revenue bonds are rated Con,( A). Steadily in- 8
,955 in 19G6 to S9,116,130 in 1974.
ktimated maximum debt service of $3,594,763 in 1978
. creasing utility tax revenues providing strong coverage, a l moderate City debt burden of 3.6% and the well being of -
excise tax obligations is covered by 1974 revenues 2.54 es. the Tampa economy are contributing factors to the pro-
- visional A 1 rating on Tampa's junior lien excise tax bonds.}}