FMPA Refinances Bonds for St. Lucie Project
ORLANDO, Fla., July 12, 2002 – The Florida Municipal Power Agency (FMPA) successfully issued bonds July 12 for its St. Lucie Project to provide the project with current debt service savings and future financial flexibility.
FMPA issued approximately $245 million of St. Lucie Project Refunding Revenue Bonds, Series 2002. The proceeds will refinance all of the project’s existing fixed-rate debt with variable-rate bonds then, using staggered swaps of three to five years, two-thirds of the variable debt will be swapped to fixed interest rates.
The Series 2002 bonds are insured by AMBAC and carry a triple-A rating. Moody’s Investors Service assigned an underlying credit rating of “A3” to all St. Lucie Project bonds outstanding and raised the project’s rating outlook to stable. Fitch Ratings assigned an underlying credit rating of “A-” to all bonds and maintains a stable outlook.
The refinancing is expected to reduce debt service by approximately $5 million annually, which would decrease the project’s total power costs by an estimated $8 per Megawatt-hour, or approximately 12%. The actual results will vary over time depending on the actual swap rates and normal fluctuations in variable rates.
FMPA’s St. Lucie Project is an 8.8 percent ownership interest in St. Lucie Unit 2, an 838 MW nuclear power plant operated by Florida Power & Light (FPL). Power from the unit is sold by FMPA to 15 municipal electric utilities in Florida, including Alachua, Clewiston, Fort Meade, Fort Pierce, Green Cove Springs, Homestead, Jacksonville Beach, Kissimmee, Lake Worth, Leesburg, Moore Haven, New Smyrna Beach, Newberry, Starke and Vero Beach.
FMPA structured the Series 2002 bonds to provide financial flexibility in anticipation of a possible operating license extension for Unit 2. The unit is currently licensed to operate until April 2023. FPL submitted an application to the Nuclear Regulatory Commission (NRC) on Nov. 30, 2001, seeking to extend the unit’s operating license by 20 years. The NRC’s review and decision is expected to take two years to complete.