$380,300,000 Senior Secured Consumer Rate Relief Bonds, scheduled to pay principal semi-annually and sequentially in accordance with the expected sinking fund schedule.
Issuing Entity and Capital Structure
Appalachian Consumer Rate Relief Funding LLC is a special purpose Delaware limited liability company. Appalachian Power Company is our sole member and owns all of our equity interests. We have no commercial operations. We were formed solely to purchase and own CRR property, to issue the bonds and to perform activities incidental thereto. Please read "Appalachian Consumer Rate Relief Funding LLC, the Issuing Entity" in the accompanying prospectus.
In addition to the CRR property, we will be capitalized with an upfront cash deposit equity contribution from APCo equal to 0.5% of the bonds’ initial principal amount issued (held in the capital subaccount) and will have an excess funds subaccount to retain any amounts collected and remaining on a payment date after all payments on the bonds and all ongoing financing costs have been made.
Purpose of transaction
This issuance of the bonds will enable APCo to recover certain uncollected ENEC costs and associated financing costs in the State of West Virginia. Please read "The Recovery Act" in the accompanying prospectus.
The State of West Virginia has pledged in the Recovery Act to bondholders, assignees and financing parties under the financing order that it will not take or permit any action that would impair the value of the CRR property or revise the consumer rate relief costs for which recovery is authorized under the financing order or, except for the specified true-up adjustments to correct any overcollections or undercollections, reduce, alter or impair the CRR charges until all principal and interest in respect of the bonds and all financing costs and all amounts to be paid to an assignee or financing party under an ancillary agreement are paid or performed in full. No voter initiative or referendum process exists in West Virginia, unlike in some other states. Please read "The Recovery Act—APCo and Other Utilities May Securitize Consumer Rate Relief Costs" in the accompanying prospectus.
One Riverside Plaza
Columbus, Ohio 43215
View SEC filings for Appalachian Consumer Rate Relief Funding LLC.
|08/01/2018||10-D||2018 Form 10-D|
|03/23/2018||10-K||2017 Form 10-K|
|02/01/2018||10-D||2018 Form 10-D|
|08/01/2017||10-D||2017 Form 10-D|
|03/30/2017||10-K||2016 Form 10-K|
|02/01/2017||10-D||2017 Form 10-D|
|08/01/2016||10-D||2016 Form 10-D|
|02/01/2016||10-D||2016 Form 10-D|
|03/28/2016||10-K||2015 Form 10-K|
|08/03/2015||10-D||2015 Form 10-D|
|03/27/2015||10-K||2014 Form 10-K|
|02/02/2015||10-D||2015 Form 10-D|
|07/25/2014||10-D||2014 Form 10-D|
|03/28/2014||10-K||2013 Form 10-K|
|11/19/2013||8-K||2013 Form 8-K|
|11/15/2013||8-K||2013 Form 8-K|
|11/06/2013||433||Term Sheet Filed Pursuant to Rule 433|
|11/01/2013||424B5||Prospectus Filed Pursuant to Rule 424|
Senior Secured Consumer Rate Relief Bonds
Appalachian Consumer Rate Relief Funding LLC
Senior Secured Consumer Rate Relief Bonds
|Tranche||Expected Average Life (Years)||Principal Amount Issued||Scheduled Final Payment Date||Final Maturity Date||Interest Rate||Initial Price to Public||Underwriting Discounts and Commissions||Proceeds to Issuer(Before Expenses)|
The total price to the public is $380,282,591. The total amount of the underwriting discounts and commissions is $1,521,200. The total amount of proceeds to the issuing entity before deduction of expenses (estimated to be $2,754,217) is $378,761,391.
Investing in the Senior Secured Consumer Rate Relief Bonds involves risks. Please read “Risk Factors” on page 10 of the accompanying prospectus.
Appalachian Consumer Rate Relief Funding LLC, or the issuing entity, is issuing $380,300,000 of Senior Secured Consumer Rate Relief Bonds, referred to herein as the consumer rate relief bonds or the bonds, in two tranches. Appalachian Power Company, or APCo, is the depositor, seller, initial servicer and sponsorwith regard to the bonds. The bonds are senior secured obligations of the issuing entity supported by the consumer rate relief property, described in this prospectus supplement, which includes the right to a special, irrevocable nonbypassable charge, known as a consumer rate relief charge or a CRR charge, paid by West Virginia retail electric customers of APCo (or any successor) based on their electricity consumption and/or demand as discussed in this prospectus supplement and the accompanying prospectus. The Recovery Act (defined herein) mandates that CRR charges be adjusted at least annually, and the Public Service Commission of West Virginia, or the PSC, further requires such true-ups to occur semi-annually (and permits such true-ups to occur more frequently) if necessary, in each case to ensure the expected recovery of amounts sufficient to timely provide all scheduled payments of principal and interest on the bonds and all ongoing financing costs, as described further in this prospectus supplement and the accompanying prospectus. Credit enhancement for the bonds will be provided by such true-up adjustments as well as by accounts held under the indenture.
The bonds represent obligations only of the issuing entity and do not represent obligations of APCo or any of its affiliates other than the issuing entity. The bonds are secured by the assets of the issuing entity, consisting principally of the CRR property and funds on deposit in the collection account for the bonds and related subaccounts. Please read “The Bonds—The Collateral” and “—The CRR Property” and “Credit Enhancement” in this prospectus supplement. The bonds are not a debt or general obligation of the State of West Virginia, the PSC or of any county, municipality or other political subdivision of the State of West Virginia and are not a pledge of the faith and credit or taxing power of the State of West Virginia or any county, municipality or other political subdivision of the State of West Virginia.
The PSC guarantees that it will act pursuant to its financing order to ensure that expected CRR charges are sufficient to pay on a timely basis scheduled principal of and interest on the bonds and all other ongoing financing costs as described below in this prospectus supplement and the accompanying prospectus. The PSC’s obligations relating to the bonds, including the specific actions that it has guaranteed to take, are direct, explicit, irrevocable and unconditional upon issuance of the bonds, and are legally enforceable against the PSC.
Additional information is contained in the accompanying prospectus. You should read this prospectus supplement and the accompanying prospectus carefully before you decide to invest in the bonds. This prospectus supplement may not be used to offer or sell the bonds unless accompanied by the prospectus.
Matters relating to the structuring, marketing and pricing of the bonds have been considered jointly with the PSC, acting through Public Resources Advisory Group, as its independent financial advisor.
Ratings assigned to the Appalachian Consumer Rate Relief Funding LLC Senior Secured Consumer Rate Relief Bonds and to the debt issued by the Servicer
Issuer: Appalachian Consumer Rate Relief Funding LLC
Instrument: Senior Secured Consumer Rate Relief Bonds
S&P Rating: AAA
Moody’s Rating: Aaa
Servicer: Appalachian Power Company
Instrument: Senior Unsecured Debt
Moody’s Rating: Baa2
Moody’s Outlook: Stable
S&P Rating: BBB
S&P Outlook: Stable