Show Page 6 IPP Special Section Millard Count Chronicle Progress 8 THE TRADING floor at Goldman-Sack- s in New York lead underwriter for IPA (Right photo) TRADING IPA’s portfolio and overseeing the debt management program is the responsibility of IPA’s Treasury Department staff - l¥ I r"t) Intermountain Power Agency raises money Back when Intermountain Power Project was still a dream the planners began looking about for a way to finance this huge venture The financing method they agreed upon was the issuance of municipal revenue bonds that is bonds that are retired from customer revenues Cities use this kind of financing for sewer and water projects for example of that financing To take advantage Power Agency was method Intermountain formed as a political subdivision of State under the Utah Interlocal government Act The 23 Utah municipal Cooperation utilities joined together and began financing To avoid costly delays in 1981 they prefunded construction costs and invested the funds until they were required Because of the stability of the participants the first issues were and the organization well received The interest rates on the bonds (the Agency’s cost of borrowing) tracked the country’s economy rising to an average high in 1982 3 of 1321 percent and slowly declining to percent by the time the financing requirement of $44 billion was met The California participants provided the $11 billion necessary for the Southern Transmission System Then interest rates began to drop rapidly and the Agency began a refunding program as a homeowner would refinance his home mortgage as interest rates dropped As a result of refunding the average borrowing cost has dropped to 860 percent The resulting savings over the life of the bonds is nearly $2 billion or $37 million annually In addition savings to the ratepayers have resulted from the investment program The Agency has earned $1 254 billion by investing in the proceeds of the issues until they are required That amounts to 28 percent of the total construction cost The cumulative effect of the Agency’s debt management program is a measurable difference in the cost of power to the ratepayers Shurtleff & Andrews would like to congratulate the Owners Management Contractors and especially the workers who contributed to the Intermountain Power Project We are proud to have been a part of this effort COMPLETE CRANE RENTALS HEAVY RIGGING SERVING THE CONSTRUCT! Of NEED ft LIFT? BPJDOES ETC OL REFINERIES OfTUE LSDILDINQS STRUCTURAL HOTELS STEEL MDRAOUC TRUCK CRANES I2i TO TRUCK CRANES 8 TO 140 TONS CRAWLER & ROUGH 973-90- TERRAIN 500 75 TONS CRANES TO fcOO TONS 96 SHURTLEFF IB75 WEST I MCMINO SINCE 1047 BIG OR SMALL- - WE'VE DONE IT ACL! POWER PCtfTS WE ERECT MHi INDUSTRY IN UTM PROJECTS THROUGHOUT AMERICA SOUTH 8- - ANDREWS SALT LAKE CJTV UTAH S4I04 |