LCDA issues bonds on behalf of the Louisiana Utilities Restoration Corporation for the benefit of Entergy Gulf States Louisiana, LLC and Entergy Louisiana, LLC
On August 6, 2014, the Louisiana Local Government Environmental Facilities and Community Development Authority (“LCDA”) issued bonds on behalf of the Louisiana Utilities Restoration Corporation (“LURC”) for the benefit of Entergy Gulf States Louisiana, LLC (“EGSL”) and Entergy Louisiana, LLC (“ELL”). The purpose of the System Restoration Bonds was to finance a non-shareholder capital contribution to the Companies related to their respective storm costs in Louisiana from Hurricane Isaac in 2012, carrying costs, storm reserves, and issuance costs of the bonds. The bonds totaled $71,000,000 for EGSL and $243,850,000 for ELL.
The Louisiana legislature, during the Regular Session of 2007 - Act No. 55, created LURC for the purpose of financing capital contributions to utilities through the issuance of “System Restoration Bonds”. The 2014 issues were the second time the LCDA issued bonds for LURC, and the 3rd time that LURC has utilized the Act. In July, 2010, an aggregate of $713,000,000 of System Restoration Bonds were issued for costs resulting from Hurricanes Gustav and Ike, carrying costs, storm reserves, and issuance of costs of the bonds.
Gordon King of Government Consultants, Inc., Financial Advisor to LURC, says… we had a great sale which was led by Citigroup, and which resulted in an interest rate lower than the rates on the 2010 bond financings (which, at the time, were the lowest rates in the country for this class of bonds). This time, the rates on both series of bonds were below 3.00% - resulting in significant savings to the ratepayers. This is a unique municipal bond transaction, which allows the LCDA members (many of whom are in the ELL and EGSL service areas) to assist their constituents in the form of providing a conduit issuer for use in this financing. The Finance Team is very proud of the results achieved in this transaction.
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