SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
_________________
FORM 10-Q
(Mark One)
[X]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(D) OF THE SECURITIES EXCHANGE
ACT OF 1934
For the quarterly period ended June 30, 1999
or
[ ] TRANSITION REPORT PURSUANT TO SECTION 13 or 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934
For the transition period from _____ to _____
COMMISSION FILE NUMBER 333-30715
---------
CALIFORNIA INFRASTRUCTURE AND ECONOMIC DEVELOPMENT BANK
SPECIAL PURPOSE TRUST PG&E-1
----------------------------
(Issuer of the Certificates)
PG&E Funding LLC
----------------
(Exact name of Registrant as Specified in its Charter)
Delaware 94-3274751
-------- ----------
(State or Other Jurisdiction of (IRS Employer Identification Number)
Incorporation or Organization)
245 Market Street, Room 424, San Francisco, California 94105
------------------------------------------------------------
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (415) 972-5467
-------------
Indicate by check mark whether the Registrant (1) has filed all reports
required to be filed by Section 13 or 15(d) of the Securities Exchange Act of
1934 during the preceding 12 months (or for such shorter period that the
registrant was required to file such reports), and (2) has been subject to
such filing requirements for the past 90 days. Yes [X]. No___.
THE REGISTRANT MEETS THE CONDITIONS SET FORTH IN GENERAL INSTRUCTION
H 1(A) AND (B) OF FORM 10-Q AND IS THEREFORE FILING THIS FORM WITH
THE REDUCED DISCLOSURE FORMAT.
<PAGE>
PART I
FINANCIAL INFORMATION
ITEM 1. FINANCIAL STATEMENTS.
<TABLE>
<CAPTION>
PG&E FUNDING LLC
BALANCE SHEET (IN THOUSANDS)
Balance at June 30, December 31,
1999 1998
------------- -------------
ASSETS
- ------
CURRENT ASSETS:
<S> <C> <C>
Cash and cash equivalents $ 3,826 $ 2,105
Current portion of Transition Property receivable 287,683 289,785
Other 2 -
---------- ----------
TOTAL CURRENT ASSETS 291,511 291,890
NONCURRENT ASSETS:
Restricted funds 39,690 21,547
Transition Property receivable 2,157,620 2,318,279
Unamortized debt issuance expenses 13,219 15,042
---------- ----------
TOTAL NONCURRENT ASSETS 2,210,529 2,354,868
---------- ---------
TOTAL ASSETS $2,502,040 $2,646,758
========== ==========
LIABILITIES AND MEMBER'S EQUITY
- ---------------------------------
CURRENT LIABILITIES:
Accounts payable and accrued expenses $ - $ 48
Interest payable 2,724 2,848
Current portion of long-term debt 290,000 290,000
---------- ----------
TOTAL CURRENT LIABILITIES 292,724 292,896
Long-term debt 2,172,897 2,320,565
---------- ----------
TOTAL LIABILITIES 2,465,621 2,613,461
MEMBER'S EQUITY 36,419 33,297
---------- ----------
TOTAL LIABILITIES AND MEMBER'S EQUITY $2,502,040 $2,646,758
========== ==========
<FN>
The accompanying Notes to Financial Statements are an integral part of this
statement.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PG&E FUNDING LLC
STATEMENT OF INCOME AND CHANGES IN MEMBER'S EQUITY (IN THOUSANDS)
Three months ended June 30, Six months ended June 30,
1999 1998 1999 1998
------ ------ ------ ------
INCOME
- ------
<S> <C> <C> <C> <C>
Income from Transition Property receivable $43,033 $49,283 $87,579 $100,184
Interest income 961 773 1,846 1,226
------- ------- ------- -------
TOTAL INCOME 43,994 50,056 89,425 101,410
EXPENSES
- --------
Interest expense 40,619 46,411 82,980 93,179
Servicing fees 1,578 1,339 3,210 3,151
Administrative and general 53 48 113 72
------- ------- ------- -------
TOTAL EXPENSES 42,250 47,798 86,303 96,402
------- ------- ------- -------
NET INCOME $ 1,744 $ 2,258 $ 3,122 $ 5,008
Member's equity - beginning of period 34,675 27,818 33,297 27,078
Member's distributions - - - (2,010)
------- ------- ------- -------
MEMBER'S EQUITY AT END OF PERIOD $36,419 $30,076 $36,419 $30,076
======= ======= ======= =======
<FN>
The accompanying Notes to Financial Statements are an integral part of this
statement.
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
PG&E FUNDING LLC
CONDENSED STATEMENT OF CASH FLOWS (IN THOUSANDS)
For the six months ended June 30, 1999 1998
------- -------
<S> <C> <C>
NET CASH PROVIDED BY OPERATING ACTIVITIES $167,574 $102,281
-------- -------
CASH FLOWS FROM FINANCING ACTIVITIES:
Principal payments on long-term debt (147,710) (100,819)
Equity distributions to Member - (2,010)
Net change in restricted funds (18,143) (3,373)
-------- --------
NET CASH USED IN FINANCING ACTIVITIES (165,853) (106,202)
-------- --------
NET CHANGE IN CASH AND CASH EQUIVALENTS 1,721 (3,921)
CASH AND CASH EQUIVALENTS AT JANUARY 1, 2,105 5,188
-------- --------
CASH AND CASH EQUIVALENTS AT JUNE 30, $3,826 $1,267
======== ========
SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION:
Cash paid for interest $39,978 $99,532
<FN>
The accompanying Notes to Financial Statements are an integral part of this
statement.
</TABLE>
<PAGE>
Notes to Financial Statements
- -----------------------------
A. Basis of Presentation
This Quarterly Report on Form 10-Q includes the accounts of PG&E Funding LLC,
a Delaware special purpose limited liability company, whose sole member is
Pacific Gas and Electric Company, a provider of electric and natural gas
services. Pacific Gas and Electric Company is a wholly owned subsidiary of
PG&E Corporation. Both Pacific Gas and Electric Company and PG&E Corporation
are subject to the reporting requirements of the Securities Exchange Act of
1934. This quarterly report should be read in conjunction with PG&E Funding
LLC's Financial Statements and Notes to Financial Statements
included in its 1998 Annual Report on Form 10-K.
PG&E Funding LLC, was formed on July 1, 1997, in order to effect the
issuance of notes (the Notes) intended to support a ten percent electric rate
reduction. This reduction, which became effective as of January 1, 1998, is
provided to Pacific Gas and Electric Company's residential and small
commercial electric customers in connection with the electric industry
restructuring mandated by California Assembly Bill 1890, as amended by
California Senate Bill 477 (electric restructuring legislation).
PG&E Funding LLC was organized for the limited purposes of issuing
the Notes and purchasing Transition Property. Transition Property is the right
to be paid a specified amount (presented in the financial statements as
"Transition Property receivable") from a nonbypassable charge payable by
residential and small commercial electric customers. The nonbypassable charge
was authorized by the California Public Utilities Commission (CPUC) pursuant
to the electric restructuring legislation. PG&E Funding LLC issued the Notes
in December 1997.
PG&E Funding LLC is restricted by its organizational documents from
engaging in any other activities. In addition, PG&E Funding LLC's
organizational documents require it to operate in such a manner that it should
not be consolidated into the bankruptcy estate of Pacific Gas and Electric
Company in the event that Pacific Gas and Electric Company becomes subject to
such a proceeding. PG&E Funding LLC is legally separate from Pacific Gas and
Electric Company. The assets of PG&E Funding LLC are not available to
creditors of Pacific Gas and Electric Company or PG&E Corporation, and the
Transition Property is legally not an asset of Pacific Gas and Electric
Company or PG&E Corporation. PG&E Funding LLC is expected to terminate after
final maturity of the Notes on December 26, 2009.
PG&E Funding LLC believes that the accompanying statements reflect
all adjustments that are necessary to present a fair statement of the
financial position and results of operations for the interim periods. All
material adjustments are of a normal recurring nature unless otherwise
disclosed in this Form 10-Q. Results of operations for interim periods are
not necessarily indicative of results to be expected for a full year.
The preparation of financial statements in conformity with generally
accepted accounting principles requires management to make estimates and
assumptions. These estimates and assumptions affect the reported amounts of
revenues, expenses, assets, and liabilities and the disclosure of
contingencies. Actual results could differ from these estimates.
ITEM 2. MANAGEMENT'S DISCUSSION AND ANALYSIS OF FINANCIAL CONDITION AND
RESULTS OF OPERATIONS.
The following analysis of the results of operations of PG&E Funding LLC is in
an abbreviated format pursuant to Instruction H of Form 10-Q. Such analysis
should be read in conjunction with the Financial Statements included herein
and the Financial Statements and Notes to Financial Statements included in
PG&E Funding LLC's Annual Report on Form 10-K for the year ended December 31,
1998.
PG&E Funding LLC is a special purpose, single member limited
liability company organized in July 1997 for the limited purposes of holding
and servicing the Transition Property (as described below), issuing notes
secured primarily by the Transition Property and performing related
activities. Pacific Gas and Electric Company, as the sole member of PG&E
Funding LLC, owns all of the equity securities of PG&E Funding LLC. PG&E
Funding LLC's organizational documents require it to operate in a manner such
<PAGE>
that it should not be consolidated in the bankruptcy estate of Pacific Gas and
Electric Company in the event Pacific Gas and Electric Company becomes subject
to such proceeding.
In December 1997, PG&E Funding LLC acquired Transition Property from
Pacific Gas and Electric Company and issued $2,901,000,000 in principal amount
of the PG&E Funding LLC Notes, Series 1997-1, Class A-1 through Class A-8
(the "Notes"), with scheduled maturities ranging from ten months to ten years
and final maturities ranging from two to eleven years. The Notes were issued
pursuant to an Indenture dated December 8, 1997 between PG&E Funding LLC and
Bankers Trust Company of California, N.A., as trustee (the "Indenture"). PG&E
Funding LLC sold the Notes to the California Infrastructure and Economic
Development Bank Special Purpose Trust PG&E-1, a Delaware business trust
(the "Trust"), which issued certificates corresponding to each class of Notes
(the "Certificates") in a public offering. PG&E Funding LLC entered into a
servicing agreement (the "Servicing Agreement") with Pacific Gas and Electric
Company pursuant to which Pacific Gas and Electric Company is required to
service the Transition Property on behalf of PG&E Funding LLC.
The California Public Utilities Code (the "PU Code") provides for the
creation of "Transition Property." A financing order dated September 3, 1997
(the "Financing Order") issued by the CPUC, together with the related
Issuance Advice Letter, establishes, among other things, separate
nonbypassable charges (the "FTA Charges") payable by residential electric
customers and small commercial electric customers in an aggregate amount
sufficient to repay in full the Certificates, fund the Overcollateralization
Subaccount established under the Indenture, and pay all related costs and
fees. Under the PU Code and the Financing Order, the owner of Transition
Property is entitled to collect FTA Charges until such owner has received
amounts sufficient to retire all outstanding series of Certificates and cover
related fees and expenses and the Overcollateralization amount described in
the Financing Order.
In order to enhance the likelihood that actual collections with
respect to the Transition Property are neither more nor less than the amount
necessary to amortize the Notes in accordance with their expected amortization
schedules, pay all related fees and expenses, and fund certain accounts
established pursuant to the Indenture as required, the Servicing Agreement
requires Pacific Gas and Electric Company, as the Servicer of the Transition
Property, to seek, and the Financing Order and the PU Code require the CPUC to
approve, periodic adjustments to the FTA Charges. Such adjustments will be
based on actual collections and updated assumptions by the Servicer as to
future usage of electricity by specified customers, future expenses relating
to the Transition Property, the Notes and the Certificates, and the rate of
delinquencies and write-offs. The Servicer filed an advice letter with the
CPUC, advising them of a decrease to the FTA Charge (in cents per kWh) from
1.61508 to 1.24871 for residential customers and from 1.68825 to 1.30528 for
small commercial customers effective January 1, 1999.
PG&E Funding LLC uses collections of the Transition Property
receivable to make scheduled principal and interest payments on the Notes.
Income earned on the Transition Property receivable is expected to offset
(1) interest expense on the Notes, (2) amortization of debt issuance expenses
and the discount on the Notes and (3) the fees charged by Pacific Gas and
Electric Company for servicing the Transition Property and providing
administrative services to the Note Issuer.
Income generated from the Transition Property receivable for the
three and six month periods ended June 30, 1999 was approximately $43,033,000
and $87,579,000 respectively, and for the three and six month periods ended
June 30, 1998 was approximately $49,253,000 and $100,184,000 respectively.
The decrease reflects the declining Transition Property receivable balance.
During the three month periods ended June 30, 1999 and 1998, PG&E Funding LLC
earned interest from other investments of approximately $961,000 and
$773,000 respectively, and had interest expense of approximately $40,619,000
and $46,411,000 respectively. During the six month periods ended June 30,
1999 and 1998, PG&E Funding LLC earned interest from other investments of
approximately $1,846,000 and $1,226,000 respectively, and had interest
expense of approximately $82,980,000 and $93,179,000 respectively. The
interest expense is comprised of interest on the Notes, and amortization of
the Note discount and issuance costs. The decrease in interest expense is
due to the declining balance of the Notes. PG&E Funding LLC also incurred
servicing fees of approximately $1,578,000 and $1,339,000, and trustee,
administrative, and general fees of approximately $53,000 and $48,000 for
the three month periods ended June 30, 1999 and 1998 respectively. For the
<PAGE>
six month periods ended June 30, 1999 and 1998, PG&E Funding LLC incurred
servicing fees of approximately $3,210,000 and $3,151,000, and trustee,
administrative, and general fees of approximately $113,000 and $72,000
respectively.
For the quarters ended June 30, 1999 and 1998, collections of FTA
Charges were approximately $110,995,000 and $131,918,000 respectively. This
brought the total year-to-date collections as of June 30, 1999 and 1998 to
approximately $250,340,000 and $207,110,000 respectively. The increase for
1999 is attributable to the fact that the first quarter of 1998 was the
beginning period for FTA Charges, and during that period FTA Charges were
phased-in gradually, based on the Servicer's billing cycle. Principal and
interest payments on the Notes were approximately $228,950,000 and
$200,351,000, with payments for servicing fees and other expenses of $3,297,000,
and $3,687,000 for the six month periods ended June 30, 1999 and 1998
respectively. The Note Issuer expects future collections of FTA charges to be
sufficient to cover scheduled principal and interest payments on the Notes, and
to cover related expenses.
YEAR 2000:
- ---------
The Year 2000 issue exists because software products use only two digits to
identify a year in the date field and were developed without considering the
impact of the upcoming change in the century. Some software products might
fail or function incorrectly if not repaired or replaced with Year 2000
ready products. In addition, many electronic monitoring and control
systems have two-digit date coding embedded within their circuitry and may
also be susceptible to failure or incorrect operation unless corrected or
replaced with Year 2000 ready products.
PG&E Funding LLC is dependent on Pacific Gas and Electric Company, as
servicer of the Transition Property, to collect the FTA Charges from
residential and small commercial customers and remit the FTA Charges to
the Trust. Information regarding Pacific Gas and Electric Company's Year 2000
efforts is contained in Pacific Gas and Electric Company's reports filed with
the Securities and Exchange Commission. If Pacific Gas and Electric Company,
or other third parties, fail to achieve Year 2000 readiness with respect to
systems affecting the collection and remittance of FTA Charges, there could be
a material adverse impact on PG&E Funding LLC's results of operations,
financial condition, and cash flows.
Forward-looking Information:
- ----------------------------
This Quarterly Report on Form 10-Q, including the preceding discussion of
financial condition and results of operations, and elsewhere, contains forward
looking statements that involve risks and uncertainties. These statements are
based on the beliefs and assumptions of management and on information
currently available to management. Words such as "estimates", "expects",
"anticipates", "plans", "believes", and similar expressions identify forward
looking statements involving risks and uncertainties. Actual results or
outcomes could differ materially.
ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
Long-term Debt:
- --------------
The table below provides information about our rate reduction bonds
at June 30, 1999:
(in millions)
Expected maturity date 1999 2000 2001 2002 2003 Thereafter Total
Rate reduction bonds $143 $290 $290 $290 $290 $1,160 $2,463
Average interest rate 6.15% 6.16% 6.22% 6.30% 6.36% 6.44% 6.34%
<PAGE>
PART II
OTHER INFORMATION
ITEM 5. OTHER INFORMATION.
The Quarterly Servicer's Certificate dated June 25, 1999 attached as
Exhibit 99.1 hereto includes certain additional information regarding
collections of FTA Charges.
ITEM 6. EXHIBITS AND REPORTS ON FORM 8-K.
(a) Exhibits required to be filed by Item 601 of Regulation S-K:
27 Financial Data Schedule for the quarter ended
June 30, 1999.
99.1 Quarterly Servicer's Certificate dated June 25, 1999.
(b) Reports on Form 8-K/A filed during the quarter ended June 30, 1999:
Amendment No. 1 to Current Report on Form 8-K/A dated
June 11, 1999, and filed with the Commission June 11, 1999.
Item 4. Changes in Registrant's Certifying Accountant.
<PAGE>
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the
Registrant has duly caused this report to be signed on its behalf by the
undersigned thereunto duly authorized on this the 13th day of August, 1999.
PG&E FUNDING LLC, as Registrant
By /s/ GABRIEL B. TOGNERI
-----------------------------
Gabriel B. Togneri, Treasurer
<PAGE>
INDEX TO EXHIBITS
Exhibit Number Description
- -------------- -----------
27 Financial Data Schedule
99.1 Quarterly Servicer's Certificate
dated June 25, 1999
<PAGE>
<TABLE> <S> <C>
<ARTICLE> UT
<MULTIPLIER> 1,000
<S> <C>
<PERIOD-TYPE> 6-MOS
<FISCAL-YEAR-END> DEC-31-1999
<PERIOD-START> JAN-01-1999
<PERIOD-END> JUN-30-1999
<BOOK-VALUE> PER-BOOK
<TOTAL-NET-UTILITY-PLANT> 0
<OTHER-PROPERTY-AND-INVEST> 39,690
<TOTAL-CURRENT-ASSETS> 291,511
<TOTAL-DEFERRED-CHARGES> 13,219
<OTHER-ASSETS> 2,157,620
<TOTAL-ASSETS> 2,502,040
<COMMON> 0
<CAPITAL-SURPLUS-PAID-IN> 25,338
<RETAINED-EARNINGS> 11,081
<TOTAL-COMMON-STOCKHOLDERS-EQ> 36,419
0
0
<LONG-TERM-DEBT-NET> 2,172,897
<SHORT-TERM-NOTES> 0
<LONG-TERM-NOTES-PAYABLE> 0
<COMMERCIAL-PAPER-OBLIGATIONS> 0
<LONG-TERM-DEBT-CURRENT-PORT> 290,000
0
<CAPITAL-LEASE-OBLIGATIONS> 0
<LEASES-CURRENT> 0
<OTHER-ITEMS-CAPITAL-AND-LIAB> 2,724
<TOT-CAPITALIZATION-AND-LIAB> 2,502,040
<GROSS-OPERATING-REVENUE> 0
<INCOME-TAX-EXPENSE> 0
<OTHER-OPERATING-EXPENSES> 3,323
<TOTAL-OPERATING-EXPENSES> 3,323
<OPERATING-INCOME-LOSS> (3,323)
<OTHER-INCOME-NET> 89,425
<INCOME-BEFORE-INTEREST-EXPEN> 86,102
<TOTAL-INTEREST-EXPENSE> 82,980
<NET-INCOME> 3,122
0
<EARNINGS-AVAILABLE-FOR-COMM> 0
<COMMON-STOCK-DIVIDENDS> 0
<TOTAL-INTEREST-ON-BONDS> 0
<CASH-FLOW-OPERATIONS> 167,574
<EPS-BASIC> 0
<EPS-DILUTED> 0
</TABLE>
EXHIBIT 99.1
QUARTERLY SERVICER'S CERTIFICATE
Exhibit E to Servicing Agreement
Quarterly Servicer's Certificate
California Infrastructure and Economic Development Bank Special
Purpose Trust PG&E-1
$2,901,000,000 Rate Reduction Certificates, Series 1997-1
Pursuant to Section 4.01(d)(ii) of the Transition Property Servicing
Agreement dated as of December 8, 1997 (the "Transition Property Servicing
Agreement") between Pacific Gas and Electric Company, as Servicer, and PG&E
Funding LLC, as Note Issuer, the Servicer does hereby certify as follows:
Capitalized terms used in the Quarterly Servicer's Certificate (the
"Quarterly Certificate") have their respective meanings as set forth in the
Agreement. References herein to certain sections and subsections are
references to the respective sections of the Agreement.
Collection Periods: March '99, April '99, May '99
Distribution Date: June 25, 1999
<TABLE>
<CAPTION>
1. Collections Allocable and Aggregate Amounts Available for the Current Distribution Date:
<S> <C>
i. Remittances for the March '99 Collection Period $39,667,921.00
ii. Remittances for the April '99 Collection Period $36,991,687.00
iii. Remittances for the May '99 Collection Period $34,335,575.00
iv. Net Earnings on Collection Account $509,223.51
-------------------
v. General Sub-Account Balance $111,504,406.51
vi. Reserve Sub-Account Balance $15,691,668.82
vii. Overcollateralization Sub-Account Balance $1,813,125.00
viii.Capital Sub-Account Balance (less $100K) $14,405,000.00
-------------------
ix. Collection Account Balance $143,414,200.33
2. Outstanding Principal Balance and Collection Account Balance as of Prior Distribution Date:
i. Class A-1 Principal Balance $0.00
ii. Class A-2 Principal Balance $14,470,651.00
iii. Class A-3 Principal Balance $280,000,000.00
iv. Class A-4 Principal Balance $300,000,000.00
v. Class A-5 Principal Balance $290,000,000.00
vi. Class A-6 Principal Balance $375,000,000.00
vii. Class A-7 Principal Balance $866,000,000.00
viii.Class A-8 Principal Balance $400,000,000.00
-------------------
ix. Rate Reduction Certificate Principal Balance $2,525,470,651.00
x. Reserve Sub-Account Balance 15,691,668.82
xi. Overcollateralization Sub-Account Balance $1,813,125.00
xii. Capital Sub-Account Balance $14,405,000.00
3. Required Funding/Payments as of Current Distribution Date:
i. Projected Class A-1 Certificate Balance $0.00
ii. Projected Class A-2 Certificate Balance $0.00
iii. Projected Class A-3 Certificate Balance $232,189,255.00
iv. Projected Class A-4 Certificate Balance $300,000,000.00
v. Projected Class A-5 Certificate Balance $290,000,000.00
vi. Projected Class A-6 Certificate Balance $375,000,000.00
vii. Projected Class A-7 Certificate Balance $866,000,000.00
viii.Projected Class A-8 Certificate Balance $400,000,000.00
-------------------
ix. Projected Class A Certificate Balance $2,463,189,255.00
x. Required Class A-1 Coupon $0.00
xi. Required Class A-2 Coupon $217,421.53
xii. Required Class A-3 Coupon $4,305,000.00
xiii.Required Class A-4 Coupon $4,620,000.00
xiv. Required Class A-5 Coupon $4,531,250.00
xv. Required Class A-6 Coupon $5,925,000.00
xvi. Required Class A-7 Coupon $13,899,300.00
<PAGE>
xvii. Required Class A-8 Coupon $6,480,000.00
xviii.Required Overcollateralization Funding $362,625.00
xix. Required Capital Sub-Account Funding $0.00
4. Allocation of Remittances as of Current Distribution Date Pursuant to 8.02(d) of Indenture:
i. Note, Delaware and Certificate Trustee Fees $1,283.33
ii. Quarterly Servicing Fee $1,578,419.16
iii. Quarterly Administration Fee $25,000.00
iv. Operating Expenses (subject to $100,000 cap) $4,827.16
v. Quarterly Interest $39,977,971.53
1. Class A-1 Certificate Coupon Payment $0.00
2. Class A-2 Certificate Coupon Payment $217,421.53
3. Class A-3 Certificate Coupon Payment $4,305,000.00
4. Class A-4 Certificate Coupon Payment $4,620,000.00
5. Class A-5 Certificate Coupon Payment $4,531,250.00
6. Class A-6 Certificate Coupon Payment $5,925,000.00
7. Class A-7 Certificate Coupon Payment $13,899,300.00
8. Class A-8 Certificate Coupon Payment $6,480,000.00
vi. Principal Due and Payable $0.00
vii. Quarterly Principal $62,281,396.00
1. Class A-1 Certificate Principal Payment $0.00
2. Class A-2 Certificate Principal Payment $14,470,651.00
3. Class A-3 Certificate Principal Payment $47,810,745.00
4. Class A-4 Certificate Principal Payment $0.00
5. Class A-5 Certificate Principal Payment $0.00
6. Class A-6 Certificate Principal Payment $0.00
7. Class A-7 Certificate Principal Payment $0.00
8. Class A-8 Certificate Principal Payment $0.00
viii.Operating Expenses (in excess of $100,000) $0.00
ix. Funding of Overcollateralization Sub-Account (to required level) $362,625.00
x. Funding of Capital Sub-Account (to required level) $0.00
xi. Net Earnings Released to Note Issuer $509,223.51
xii. Released to Note Issuer upon Series Retirement: Overcollateralization Sub-Account $0.00
xiii.Released to Note Issuer upon Series Retirement: Capital Sub-Account $0.00
xiv. Deposits to Reserve Sub-Account $6,763,660.82
xv. Released to Note Issuer upon Series Retirement: Collection Account $0.00
5. Outstanding Principal Balance and Collection Account Balance as of current distribution date:
(after giving effect to payments to be made on such distribution date):
i. Class A-1 Principal Balance $0.00
ii. Class A-2 Principal Balance $0.00
iii. Class A-3 Principal Balance $232,189,255.00
iv. Class A-4 Principal Balance $300,000,000.00
v. Class A-5 Principal Balance $290,000,000.00
vi. Class A-6 Principal Balance $375,000,000.00
vii. Class A-7 Principal Balance $866,000,000.00
viii.Class A-8 Principal Balance $400,000,000.00
-------------------
ix. Rate Reduction Certificate Principal Balance $2,463,189,255.00
x. Reserve Sub-Account Balance $22,455,329.64
xi. Overcollateralization Sub-Account Balance $2,175,750.00
xii. Capital Sub-Account Balance $14,405,000.00
6. Sub-Account Draws as of Current Distribution Date (if applicable, pursuant to Section 8.02(e) of Indenture):
i. Reserve Sub-Account $0.00
ii. Overcollateralization Sub-Account $0.00
iii. Capital Sub-Account $0.00
-------------------
iv. Total Draws $0.00
7. Shortfalls In Interest and Principal Payments as of Current Distribution Date:
i. Quarterly Interest $0.00
1. Class A-1 Certificate Coupon Payment $0.00
2. Class A-2 Certificate Coupon Payment $0.00
3. Class A-3 Certificate Coupon Payment $0.00
4. Class A-4 Certificate Coupon Payment $0.00
5. Class A-5 Certificate Coupon Payment $0.00
6. Class A-6 Certificate Coupon Payment $0.00
7. Class A-7 Certificate Coupon Payment $0.00
8. Class A-8 Certificate Coupon Payment $0.00
ii. Quarterly Principal $0.00
1. Class A-1 Certificate Principal Payment $0.00
2. Class A-2 Certificate Principal Payment $0.00
3. Class A-3 Certificate Principal Payment $0.00
4. Class A-4 Certificate Principal Payment $0.00
<PAGE>
5. Class A-5 Certificate Principal Payment $0.00
6. Class A-6 Certificate Principal Payment $0.00
7. Class A-7 Certificate Principal Payment $0.00
8. Class A-8 Certificate Principal Payment $0.00
8. Shortfalls in Required Sub-Account Levels as of Current Distribution Date:
i. Overcollateralization Sub-Account $0.00
ii. Capital Sub-Account $0.00
9. Distributions of Principal per $1,000 of Original Principal Amount
Principal Payment
per $1,000 of
Original Principal Principal Payment Orig. Principal Amt.
[ A ] [ B ] [ B/A x 1,000]
------------------ ----------------- --------------------
i. Class A-1 $0.00 $0.00 $0.000000
ii. Class A-2 $14,470,651.00 $14,470,651.00 $1,000.000000
iii. Class A-3 $280,000,000.00 $47,810,745.00 $170.752661
iv. Class A-4 $300,000,000.00 $0.00 $0.000000
v. Class A-5 $290,000,000.00 $0.00 $0.000000
vi. Class A-6 $375,000,000.00 $0.00 $0.000000
vii. Class A-7 $866,000,000.00 $0.00 $0.000000
viii.Class A-8 $400,000,000.00 $0.00 $0.000000
----------------- ----------------- -------------------
$2,525,470,651.00 $62,281,396.00
10. Distributions of Interest per $1,000 of Original Principal Amount
Interest Payment
per $1,000 of
Original Principal Interest Payment Orig. Principal Amt.
[ A ] [ B ] [ B/A x 1,000]
------------------ ----------------- --------------------
i. Class A-1 $0.00 $0.00 $ 0.000000
ii. Class A-2 $14,470,651.00 $217,421.53 $15.025000
iii. Class A-3 $280,000,000.00 $4,305,000.00 $15.375000
iv. Class A-4 $300,000,000.00 $4,620,000.00 $15.400000
v. Class A-5 $290,000,000.00 $4,531,250.00 $15.625000
vi. Class A-6 $375,000,000.00 $5,925,000.00 $15.800000
vii. Class A-7 $866,000,000.00 $13,899,300.00 $16.050000
viii.Class A-8 $400,000,000.00 $6,480,000.00 $16.200000
----------------- ----------------- -------------------
$2,525,470,651.00 $39,977,971.53
IN WITNESS HEREOF, the undersigned has duly executed and delivered this
Quarterly Servicer's Certificate this 15th day of June, 1999.
PACIFIC GAS AND ELECTRIC COMPANY, as Servicer
by: /s/ CHRISTOPHER JOHNS
---------------------------
Christopher Johns
Vice President & Controller
</TABLE>
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