SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM U-1
APPLICATION OR DECLARATION
under
The Public Utility Holding Company Act of 1935
ALABAMA POWER COMPANY
600 North 18th Street
Birmingham, Alabama 35291
(Name of company or companies filing this statement and
addresses of principal executive offices)
THE SOUTHERN COMPANY
(Name of top registered holding company parent of each applicant or declarant)
William E. Zales, Jr., Vice President
and Corporate Secretary
Alabama Power Company
600 North 18th Street
Birmingham, Alabama 35291
(Names and addresses of agents for service)
The Commission is requested to mail signed copies of all orders,
notices and communications to:
Gale E. Klappa John D. McLanahan, Esq.
Financial Vice President Troutman Sanders LLP
The Southern Company 600 Peachtree Street, N.E.
270 Peachtree Street, NW Suite 5200
Atlanta, Georgia 30303 Atlanta, Georgia 30308-2216
Walter M. Beale Jr.
Balch & Bingham LLP
1901 Sixth Avenue North
Suite 2600
Birmingham, Alabama 35201
INFORMATION REQUIRED
Item 1. Description of Proposed Transaction.
Alabama Power Company ("Alabama") is a wholly-owned subsidiary
of The Southern Company, a registered holding company under the Public Utility
Holding Company Act of 1935 (the "Act").
Alabama proposes to sell, from time to time prior to December
31, 2006, distribution line poles located in Alabama to telephone and other
utility companies (individually, the "Purchaser"). It is proposed that such
poles would be conveyed by Alabama to the Purchaser by a bill of sale,
substantially in the form of Exhibit B hereto, for a negotiated cash sale price
which would exceed Alabama's embedded cost for the number of distribution poles
being sold, and the aggregate sales price of such poles would not exceed $30
million. Alabama will obtain from its first mortgage bond Trustee a release of
such poles from the lien of Alabama's first mortgage indenture. The $30 million
authority requested herein is in addition to any exceptions otherwise provided
by rules under the Act relating to the sales of utility securities or assets.
Alabama and each Purchaser have or will have entered into a
joint use agreement pursuant to which each party may attach facilities to poles
belonging to the other party, with each party obligated to the other for rental
of space on poles owned by the other party. The proposed sale of poles by
Alabama is for the purpose of equalizing the rental payments under the joint use
agreements. It is anticipated that there will be no substantial change in the
use of the poles, and since the sale will result in an equalization of rent
under the joint use agreements, Alabama considers it appropriate and in the
interest of the public and Alabama's investors for the Purchasers to purchase
and own the distribution line poles.
The proposed transactions are substantially identical to that
authorized by the Commission in Alabama Power Company, HCAR 35-24600, March 16,
1988.
Item 2. Fees, Commissions and Expenses.
No commissions have been or will be paid in connection with
the proposed transactions. Fees and expenses paid or incurred, or to be paid or
incurred, directly or indirectly in connection with the proposed transactions,
are as follows:
Legal fees ..............................$ 5,000
Miscellaneous............................ 5,000
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Total.........................$10,000
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Item 3. Applicable Statutory Provisions.
Alabama considers that the proposed transactions are subject
to Section 12(d) of the Act and Rule 44 thereunder.
The proposed transactions will be carried out in accordance
with the procedure specified in Rule 23 and pursuant to an order of the
Commission with respect thereto. It is expected that the proposed transactions
will be consummated as soon as practicable after receipt of the order of the
Commission herein; however, Alabama requests authority to consummate the
transactions from time to time prior to December 31, 2006.
Rule 54 Analysis: The proposed transaction is also subject to Rule 54,
which provides that, in determining whether to approve an application which does
not relate to any "exempt wholesale generator" ("EWG") or "foreign utility
company" ("FUCO"), the Commission shall not consider the effect of the
capitalization or earnings of any such EWG or FUCO which is a subsidiary of a
registered holding company if the requirements of Rule 53(a), (b) and (c) are
satisfied.
Southern currently meets all of the conditions of Rule 53(a). At June
30, 2001, Southern's "aggregate investment," as defined in Rule 53(a)(1), in
EWGs and FUCOs was approximately $1,000, or 0% of Southern's "consolidated
retained earnings," also as defined in Rule 53(a)(1), as of June 30, 2001
($4.642 billion).1
In addition, Southern has complied and will continue to comply with the
record-keeping requirements of Rule 53(a)(2), the limitation under Rule 53(a)(3)
on the use of operating company personnel to render services to EWGs and FUCOs,
and the requirements of Rule 53(a)(4) concerning the submission of copies of
certain filings under the Act to retail rate regulatory commissions. Further,
none of the circumstances described in Rule 53(b) has occurred.
____________________
1 As discussed in Southern's Application on Form U-1 (File No. 70-9727) relating
to the spin-off of Mirant Corporation ("Mirant"), Southern and Mirant
reorganized certain energy-related and FUCO activities and Mirant completed a
tax-free distribution to Southern of these activities on March 5, 2001 (the
"Mini-Spin"). On April 2, 2001, Southern completed the spin-off of its remaining
ownership interest in Mirant to Southern's shareholders. Therefore, the four
indirect subsidiaries (EPZ Lease, Inc., Dutch Gas Lease, Inc., GAMOG Lease, Inc.
and NUON Lease, Inc.) obtained through the Mini-Spin are the only remaining FUCO
investments held by Southern. Although Southern now owns all of the equity in
these companies as a result of the Mini-Spin, Southern has no direct or indirect
investment or any aggregate investment within the meaning of Rule 53 in these
FUCOs, including any direct or indirect guarantees or credit positions related
to any capital or financing leases. Furthermore, the only remaining EWG
investment held by Southern after the spin-off is Southern Company-Florida LLC,
which was organized during the first quarter of 2001. Southern has executed
limited keep-well commitments whereby Southern would be required to make capital
contributions to Southern Energy Finance Capital Corp. or to Southern Energy
Finance Company, Inc. in the event of a shortfall in the scheduled debt service
resulting from certain changes in the payments due from Southern under the
Southern Company Income Tax Allocation Agreement. The maximum potential capital
contribution required under these commitments is the unamortized balance of the
related loans, which totaled approximately $402 million as of June 30, 2001.
Item 4. Regulatory Approval.
The proposed transaction is not subject to the jurisdiction of
any state commission. The proposed transaction is not subject to the
jurisdiction of any Federal commission other than the Securities and Exchange
Commission.
Item 5. Procedure.
Alabama Power requests that the Commission's order herein be
issued as soon as the rules will allow and that there be no thirty-day period
between the issuance of the Commission's order and the date on which it is to
become effective. Alabama Power waives a recommended decision by a hearing
officer or other responsible officer of the Commission and hereby consents that
the Division of Investment Management may assist in the preparation of the
Commission's decision and/or order herein, unless such division opposes the
matter covered by this application or declaration.
Item 6. Exhibits and Financial Statements.
(a) Exhibits.
A - None.
B - Form of Bill of Sale.
C - None.
D - None.
E - None.
F - Opinion of Balch & Bingham LLP
G - None
H - Form of Notice
(b) Financial Statements.
No financial statements are filed herewith since the financial
condition of Alabama is not material to the proposed transactions.
Item. 7. Information as to Environmental Effects.
(a) In view of the nature of the proposed transactions
described herein, the Commission's action in this matter will not constitute any
major federal action significantly affecting the quality of the human
environment.
(b) No other federal agency has prepared or is preparing an
environmental impact statement with regard to the proposed transactions.
SIGNATURE
Pursuant to the requirements of the Public Utility Holding
Company Act of 1935, the undersigned company has duly caused this statement to
be signed on its behalf by the undersigned thereunto duly authorized.
Dated: August 21, 2001 ALABAMA POWER COMPANY
By:/s/Wayne Boston
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Wayne Boston, Assistant Secretary