california update 4 05 01 transcript interview conducted yesterday state treasurer phil angelides summary bond issuance 10 b 10 15 year term 70 tax exempt 30 non exempt angelides favor wind fall profit tax opposed current discussion davis socal regards socal paying generators 12 years 2 year grace period decisions rate components necessary sell bonds big things need puc must enter agreement dwr essentially warranting sufficient revenues rates available purchasing power really job define party needs pay power need give assurance investment community whatever overall rate state get enough pay bonds however utilities challenge decision could stall bond issuance think size first bond issue based currently possible legislature authorized around 10 bn puc allowed us sell north 13 bn anticipate 10 bn absorbable administration provides details office public costs buying power needs terms funding drive number puc said issuance may well single 10 bn issue series smaller ones done together e g 3 bn 3 weeks apart total size market ca tax exempt bonds normally 5 10 bn bonds various revenues general obligations 1997 ca infrastructure rate reductions bonds 7 bn issuance handled well exclusively ca market around 200 bn bonds sold year anticipate bonds 70 tax exempt 30 non exempt total electric supply contracts firm enough require funding estimates dwr buying power let say power costs 100 portion rates 70 bond issuance covers diff 100 70 bond issuance way cover gap however power prices come keep borrowing issue 10 bn bonds see whole financial plan implication keep plan secret term mix bond issues overall term expected 10 15 year range know mix ability bridging tax anticipation notes anything like take care general fund purpose bridge loan taking taxable tax exempt bridge loan bonds issued order us issue bonds number steps occur would hope puc dwr realistically june bond issuance would come semi words either something like 3 billion every three weeks general funds assets cash form less liquid receivable lot liquidity real cash general fund cash flow ability pooled money investment accounts go five years 40 bn plus account minimum working capital required general fund day day operations depends goes given day order 500 mm 100 bn budget general funds special fund discussing dwr contracting relation required funding veto deals struck administration court asked information asked today letter move working 3 4 banks public offering means public disclosure general fund making advances buy power want get business stop 4 bn plus drain general fund arranging interim loan credit risk industry large users cherry picking self selecting limits options ablx limited ability people opt system allow opt pay preserve revenue stream agreement dwr puc say financing order get revenue service bonds even adjusts rates covenant money made available initiative launched could create enough uncertainty effect abix bond issuance harvey proofing direct state participation state role infrastructure economic development bonds issued name dwr pay power state buying repay utility deb think state repay utility debt state buy power chapter 11 participation state bank know harvey well agree number things example cosponsoring public power authority put state business refinancing utility debt think consumer groups realize selling bonds pay power much want interest repay general fund time office financing purchase energy fundamental problem price charged generators ransom demanded generators agree harvey current time generators winning consider excess profits taxes generators continue increased prices tenfold generators bought set plants 3 1 bn since january state spent 4 bn generators take foot throat may leave us option take back plants emergency power let justify rates causes problem generators jacking prices point make us something measurable size premium paid based current estimates bond issue size measurable wrong choice words know many basis points 10 bn begin feel also proposal allow utilities pay generators 12 years 2 year grace period work backs ratepayers perspective well 1996 97 98 upstreamed billions