Posted on 01/12/2002 9:35:48 AM PST by vmatt
Oooooooooh. Now there's a scandal. Waivers to sell at market rates... < /SARCASM >
On April 27, 2001, pursuant to delegated authority, the Director, Division of Corporate Applications, Office of Markets, Tariffs and Rates, granted requests for blanket approval under Part 34, subject to the following: Within thirty days of the date of the order, any person desiring to be heard or to protest the blanket approval of issuances of securities or assumptions of liability by Enron Energy should file a motion to intervene or protest with the Federal Energy Regulatory Commission, 888 First Street, NE., Washington, DC 20426, in accordance with Rules 211 and 214 of the Commission's Rules of Practice and Procedure (18 CFR 385.211 and 385.214).
Absent a request to be heard in opposition within this period, Enron Energy is authorized to issue securities and assume obligations or liabilities as a guarantor, indorser, surety, or otherwise in respect of any security of another person; provided that such issuance or assumption is for some lawful object within the corporate purposes of the applicant, and compatible with the public interest, and is reasonably necessary or appropriate for such purposes.
The Commission reserves the right to require a further showing that neither public nor private interests will be adversely affected by continued approval of Enron Energy's issuances of securities or assumptions of liability.
CFR 18 part 34 is here. What I interpret this to mean is that DOE requires each issuance of securities to be approved, which of course requires all requisite current financial info to be provided for each application of issuance. In addition, each issuance would be scrutinized to make sure it was on the up and up. This look like what is waived, and only if someone protested would the issuance be looked at.
In otherwards, no one was keeping track of these issuances to see if Enron was assuming too much liability and endangering their financial position. This is not good news for the admin.
34.1c: "(c) Exemptions. (1) If an agency of the State in which the utility is organized and operating approves or authorizes, in writing, the issuance of securities prior to their issuance, the utility is exempt from the provisions of sections 19, 20 and 204 of the Federal Power Act and the regulations under this part, with respect to such securities. "
"34.1c.3: (3) For certain qualifying facilities. Any cogeneration or small power production facility which is exempt from sections 19, 20 and 204 of the Federal Power Act pursuant to Sec. 292.601 of this chapter shall be exempt from the provisions of this part. "
These are the only reasons for exemptions I can find.
Whichever was used, there is no fault in following regulations.
I agree. The administration allowed Enron to keep the deception going. This is not good.
That was a great idea to look through the Register.
It was probably issued because "(c) Exemptions. (1) If an agency of the State in which the utility is organized and operating approves or authorizes, in writing, the issuance of securities prior to their issuance, the utility is exempt from the provisions of sections 19, 20 and 204 of the Federal Power Act and the regulations under this part, with respect to such securities. "
...but without the application we really don't know.
Enron received a blanket waiver from all of part 34, you're looking at regular exemptions.
Good question and it appeared unusual but I can't be sure I will look. Timing really sucked though, eh?
If you find another authority in 18 CFR Part 34 to grant waivers please post it.
Oh yeah, good catch!
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