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CUC officials tell Senate lenders want sovereign immunity waiver and identified collateral
Summary
CUC representatives told the Senate lenders want an absolute waiver of sovereign immunity and specific collateral or dedicated revenue streams before lending for post-typhoon restoration, and urged amendments to HB 24-107 to address those requirements.
CUC management told the Senate that proposed emergency financing authority will not be effective unless the statute addresses lender conditions, including a waiver of sovereign immunity and identifiable collateral.
Michael Earnest, speaking for CUC, summarized feedback from potential lenders: "The 1st concern was they wanted an absolute waiver of sovereign immunity... And identified specific collateral." Earnest said generators, poles, and power lines are unlikely to satisfy lenders, and that lenders instead seek dedicated revenue streams or specific cash assets under CUC control.
Betty Terlahi, CUC chief financial officer, described ongoing outages and the urgency: "There are still approximately 4,000 customers ... that are still without electricity." She urged senators to support the amended bill to secure financing at the lowest possible cost and with the least impact on residential and commercial ratepayers.
Kevin Watson, CUC executive director, also urged passage, saying the authority would allow CUC to take out a line of credit and "help expedite our recovery efforts." Senators asked for clarity on which revenue streams or assets could legally be pledged and pressed CUC to provide details to expedite lender negotiations.
CUC requested statutory language changes that would make the statute "friendly for potential lenders" so that a public RFP process will attract competitive offers and lower borrowing costs for ratepayers.
