Douglas County PUD Commissioners Mike Doneen, Jim Davis and Lynn Heminger held a special meeting, July 13, 2006 at 4:00 p.m. in the East Wenatchee Headquarters building.
At this meeting the Commissioners were informed Standard Poors upgraded the rating of Douglas PUD Electric Distribution System Bonds to AA from AA- and affirmed the rating for Wells Hydroelectric Project Bonds at AA. “The upgrade for the Electric Distribution System to AA more accurately reflects the historical financial performance of Douglas PUD as well as the utility’s ability to deliver benefits to Douglas County residents well into the future,” said Douglas PUD manager Bill Dobbins.
SP believes the credit rating outlook for the District's electric system and Wells Hydroelectric bonds is stable because of the District's consistently strong financial performance, very good cash reserves and exceptionally competitive power supply quantity and cost.
Other strengths include: Unique design of the Wells Project allows the District to meet environmental standards with limited impact on project operations or capital requirements; The Wells Project’s strong operating performance and the flexibility afforded by its 10 turbines; Extremely low production costs making the District’s resale prices among the lowest anywhere; Strong long-term Wells Project power sales contracts, which extend through 2018, that include take-or-pay provisions and a 25% step-up provision.
Moody’s Investors Service also confirmed their rating of the District’s Wells Project and Distribution System Revenue Bonds at Aa2 due to these strengths: The Wells Hydroelectric Project is one of the lowest cost resources in the US, even in low water years, and has a strong operating record; Strong take-or-pay power sales contracts; Conservative budgeting and forecasting practices result in sound financial operations and ample reserves for Electric Distribution System; Fisheries concerns have been largely addressed and a settlement with neighboring Indian Tribes eliminates a significant claim and potential challenge to license extension application.
Commissioners also executed the following actions:
Authorized the Issuance of $13,280,000 Wells Hydroelectric Revenue Refunding Bonds, Series 2006A and Series 2006B. The sale of the refunding bonds will provide $2,213,706 net present value savings for the Wells Hydroelectric Project. (06-180)
Signed the Bond Purchase Contract for the Wells Hydroelectric Revenue Refunding Bonds, Series 2006A.