california update 5 4 01 questions please contact kristin walsh 713 853 9510 bridge loan financing bills may meet may 8 th deadline due lack support sources report vote regarding authorization bond issuance bridge loan may 8 th deadline possibility deal reportedly fallen apart according sources republicans democratic caucuses turning davis democratic caucus reportedly unwilling fight davis many legislative republicans democrats reportedly trust davis express concern bonds issued replenish general fund davis would double dip fund clearly lack good faith legislature governor however believed davis discloses details power contracts negotiated bond issuance take place additionally generator sources reported long term power contracts opposed still development require bond issuance happen july 1 2001 state may breach contract sources state legislature pass bridge loan legislation may 8 th bond issuance july lst difficult republicans planning offer alternative plan whereby state would eat 5 billion cost power spent date general fund thereby decreasing amount bond issuance approximately 8 billion however reportedly going offer even concession sources report republicans intend hold full disclosure governor plan handling crisis including details terms long term contracts negotiated support bond issuance go forward currently two bills dealing bridge loan ab 8 x ab 31 x ab 8 x authorizes dwr sell 10 billion bonds bill passed senate march stalled assembly due lack republican support ab 31 x deals energy conservation programs community college districts however sources report bill may amended include language relevant bond sale senator bowen currently ab 8 x senator bowen language states state get paid utilities rate payments passed would likely cause socal bankruptcy according sources close republicans legislature republicans believe bridge loan due money available general fund instance tony strickland stated 1 2 bonds approximately 5 billion issued republicans reportedly support issuing bonds republicans intend bring debate monday additionally lehman brothers reportedly also feels bridge loan unnecessary indications lehman may back bridge loan key points bridge financing initial loan amount 4 125 b lenders jp morgan 2 5 b lehman brothers 1 0 b bear stearns 625 tax exempt portion 4 125 b 1 6 b expected tax exempt projected interest rate taxable rate 5 77 tax exempt rate 4 77 current projected blended ir 5 38 maturity date august 29 2001 details please contact 713 853 9510 bill sb 6 x passed senate yesterday little done time senate passed sb 6 x yesterday authorizes 5 billion create california consumer power conservation authority 5 billion authorized sb 6 x 5 billion must authorized legislature pay power already purchased additional amount bonds must authorized pay purchasing power going forward republicans support authorizations without details long term power contracts governor negotiated republicans know final bond amount must issued taxpayers pay support action taken regarding implementation sb 6 x clarified state utilities get paid purchasing power also staff defined purpose etc california public power conservation authority however considered victory consumer advocates began promoting idea earlier crisis socal edison bankruptcy point two events would likely trigger socal bankruptcy first would legislative rejection mou socal governor specified deadline legislative approval mou august 15 th however decision likely made earlier according sources state yet sign mou socal though socal signed republicans mou current form davis senate lack votes needed pass legislature indicates pas mou socal would likely file voluntary bankruptcy creditor involuntary due lack operating cash second likely triggering event linked directly bond issuance would effort senator bowen amend sb 31 x bridge loan stating dwr would received 100 payments ratepayers utilities would receive residual amount words state get paid utilities language included passed legislature appears likely socal likely file bankruptcy socal urging legislature pay utilities dwr proportionately rate payments