The State of Texas filed an administrative appeal last week against the Public Utility Commission of Texas' decision to give CenterPoint Energy the green light to issue $1.8 billion in rate reduction bonds, delaying the issue that CenterPoint was planning for the near term (see ASR 3/14/05). The appeal was filed last Wednesday in the District Court of Travis County, Texas, where the state capital of Austin is located, and could derail the deal indefinitely. Tom Kelly, spokesman for the Texas State Attorney General's office, declined to comment, saying it does not comment on pending legal matters.

"We are looking forward to having the matter resolved so that we can get the transition bonds to the market," said CenterPoint spokesman Floyd LeBlanc. LeBlanc said CenterPoint believes the Commission issued a valid financing order and plans to intervene on behalf of the Commission's decision, meaning that the company will ask the court for permission to speak and to present evidence in the case. Terry Hadley, spokesman for the PUC, declined to comment saying, "We have not had time to review [the appeal] yet."

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