FORM U-3A-2 RGC RESOURCES, INC.
FILE NO.
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C.
Statement By Holding Company Claiming Exemption
Under Rule U-3A-2 From the Provisions of the
Public Utility Holding Company Act of 1935
RGC Resources, Inc. hereby files with the Securities and Exchange
Commission (the Commission), pursuant to Rule 2, its statement claiming
exemption as a holding company from the provisions of the Public Utility Holding
Company Act of 1935 (the "Act"), and submits the following information:
1. The Claimant RGC Resources, Inc., a Virginia corporation, is a
holding company which directly or indirectly holds interests in the following
subsidiaries, each of which is organized under the laws of the Commonwealth of
Virginia or the State of West Virginia:
a. Roanoke Gas Company ("Roanoke Gas"), a public service corporation
organized under the laws of the Commonwealth of Virginia;
b. Diversified Energy Company, a Virginia corporation, d/b/a
Highland Propane Company ("Highland Propane") and d/b/a Highland
Gas Marketing;
c. Bluefield Gas Company ("Bluefield Gas"), a public service
corporation organized under the laws of the State of West
Virginia.
d. RGC Ventures, Inc., a West Virginia Corporation, d/b/a
Highland/Cox Heating and Cooling and d/b/a GIS Resources.
The business address of the Claimant and each of its subsidiaries is:
Roanoke Gas Company, Diversified Energy Company and
RGC Ventures, Inc.
519 Kimball Avenue, N.E.
Roanoke, VA 24016
Bluefield Gas Company
4699 East Cumberland Road
Bluefield, WV 24701
<PAGE>
Roanoke Gas is a public service corporation organized and existing in
good standing under the laws of the Commonwealth of Virginia. Roanoke Gas
distributes natural gas to some 52,370 residential, commercial and industrial
customers located in the City of Roanoke and environs and Bluefield, Virginia
pursuant to certificates of convenience and necessity at rates and charges
issued and prescribed by the State Corporation Commission of Virginia ("Virginia
Commission"). Diversified Energy Company, a Virginia corporation, operates as
Highland Propane Company ("Highland Propane"), and Highland Gas Marketing.
Highland Propane, which is not a public utility, is operated under two (2)
divisions, Highland Propane-Roanoke and Highland Propane-Bluefield. Highland
Propane-Roanoke is engaged in the business of selling liquefied petroleum gas
(propane) in bulk to residential, commercial and industrial customers in and
around Roanoke, Virginia and Southwest Virginia. Roanoke Gas provides managerial
and other direct labor, goods and services to Highland Propane-Roanoke under
agreement approved by the Virginia Commission. Highland Propane is not otherwise
subject to the regulatory jurisdiction of the Virginia Commission. Highland
Propane-Bluefield is engaged in the business of selling liquefied petroleum gas
(propane) in bulk to residential, commercial and industrial customers in
Southern West Virginia and has offices in Bluefield and Rainelle, West Virginia.
Highland Gas Marketing is a purchasing and marketing entity that buys fuels on
the spot and short-term market and resells to certain end-users.
Bluefield Gas Company ("Bluefield Gas"), a West Virginia public service
corporation, is regulated as to rates and service by the Public Service
Commission of the State of West Virginia ("West Virginia Commission"). Bluefield
Gas provides natural gas service to some 4,282 residential, commercial and
industrial customers located in and around Bluefield, West Virginia.
RGC Ventures, Inc., a West Virginia Corporation, operates as Highland/
Cox Heating and Cooling and GIS Resources. Highland/Cox Heating and Cooling is
headquartered in Beckley, West Virginia and provides sales installation and
service for heating, ventilation, and air conditioning equipment with offices in
Beckley, Summersville and Lewisburg, West Virginia. GIS Resources (Geographic
Information Systems) combines database management tools with state-of-the-art
geographic mapping techniques to develop a user friendly, broad based,
management information system.
2. Columbia Gas Transmission Corporation ("Columbia") is Roanoke Gas'
primary transporter of natural gas. Columbia historically has transported
approximately two-thirds of Roanoke Gas' gas supply and 100% of Bluefield Gas'
gas supply. Prior to Federal Energy Regulatory Commission Order 636, Roanoke Gas
and Bluefield Gas purchased their core market requirements through Demand
Purchases, Firm Transportation Service and Firm Storage Service. Additional
requirements were met through the use of spot and short-term purchases under
contracts with producers and brokers. Under Order 636 the responsibility for
obtaining dependable natural gas supplies shifts from the pipeline companies to
the local distribution companies and to other "shippers" of natural gas. The
Company purchases gas supplies from a variety of producers and marketers. Recent
examples of suppliers or marketers include Cabot Oil
<PAGE>
and Gas, Columbia Energy Services, Coral Energy, Engage Energy, PG&E Energy
Trading and Southern Company Energy Marketing.
Roanoke Gas' other major transporter is East Tennessee Natural Gas
Company ("East Tennessee"), an El Paso Energy Company. Historically, East
Tennessee has delivered approximately one-third of Roanoke Gas' natural gas
supply.
Roanoke Gas receives its gas supply from Columbia at two city gate
stations. Each station is connected by a thirty-three mile transmission line to
Columbia's system at Gala, Virginia. Roanoke Gas receives its gas supply from
East Tennessee at four city gate stations located on East Tennessee's
transmission line. The city gate stations are located on the perimeter of a
network of distribution mains located in the Cities of Roanoke and Salem, the
Towns of Vinton, Fincastle and Troutville, and the Counties of Bedford,
Botetourt, Montgomery and Roanoke, Virginia. Also, located on our transmission
line in Botetourt County, Virginia is a liquefied natural gas storage facility
which has the capacity to hold 200 million cubic feet of natural gas.
Bluefield Gas owns a transmission line extending from Princeton, West
Virginia to Bluefield, West Virginia, and a distribution system within the City
of Bluefield, West Virginia and the immediate surrounding area of Mercer County,
West Virginia. In December 1998, Bluefield Gas Company completed approximately
two miles of 4" steel distribution lines to connect to facilities owned by
Phoenix Energy Sales Company that provides for the delivery of natural gas from
Consolidated Natural Gas Company. A portion of the gas transported by Bluefield
Gas is sold at the West Virginia-Virginia state line to Roanoke Gas for resale
to its customers through a distribution network in Bluefield, Virginia and the
immediate surrounding area of Tazewell County, Virginia.
Highland Propane-Bluefield's principal bulk storage facility, located at
its Bluefield, West Virginia facility, is comprised of two 30,000-gallon storage
tanks and one 18,000-gallon storage tank. Three 18,000-gallon storage tanks are
located at its Rainelle, West Virginia facility, one 30,000-gallon tank is
located at Ansted, WV, and one 30,000-gallon tank is located at Beckley, WV.
Highland Propane-Roanoke owns and operates ten storage facilities. A
facility at Thirlane Road, N.W. in Roanoke, Virginia consists of two
30,000-gallon tanks. A second facility at Fort Chiswell, Virginia consists of
two 35,000-gallon tanks. The third facility is located on the property of
Consolidated Glass in Galax, Virginia and consists of one 30,000-gallon tank.
The fourth facility is located in Craig County, near the town of New Castle,
Virginia and consists of one 30,000-gallon tank. The fifth facility, located
near the intersection of Routes 221 and 679 in Floyd County, consists of one
30,000-gallon tank. The sixth facility is located on the property of Virginia
Forging in Botetourt County, near the Town of Buchanan, Virginia, and consists
of one 30,000-gallon tank. The seventh facility is located on the property of
Golden West Foods in Bedford, Virginia and consists of one 30,000-gallon tank.
The eighth facility is located in the City of Buena Vista, Virginia and consists
of two 30,000-gallon tanks. The ninth facility is located in Allegheny County
near the Town of Low Moor and consists of one 30,000-gallon tank. The
<PAGE>
tenth facility is located at Weyers Cave in Augusta County, Virginia and
consists of one 30,000-gallon tank.
3. The following information for the last calendar year with respect to
Roanoke Gas and Bluefield Gas is submitted:
a. Roanoke Gas distributed at retail 6,760,557 MCF of gas during the
calendar year 1999 for total revenues of $44,454,408. Bluefield
Gas distributed at retail 839,731 MCF of gas in the State of West
Virginia during the calendar year 1999 for total revenues of
$4,895,013.
b. Neither Roanoke Gas nor Bluefield Gas distributed at retail
natural gas outside the state of its incorporation.
c. Roanoke Gas did not sell at wholesale natural gas outside the
Commonwealth of Virginia. Bluefield Gas sold 244,594 MCF of
natural gas at wholesale to Roanoke Gas at the Virginia-West
Virginia line for $1,033,654.
d. Roanoke Gas purchased 7,095,483 MCF of natural gas outside the
Commonwealth of Virginia during the calendar year 1999 for
$27,232,660. All such gas was transported to Roanoke Gas for
resale as system supply by Columbia Gas Transmission Corporation,
East Tennessee Natural Gas Company, and Bluefield Gas. Bluefield
Gas purchased 1,182,711 MCF of natural gas for $4,418,113 outside
the State of West Virginia. All such gas was transported to
Bluefield Gas for resale as system supply by Columbia Gas
Transmission Corporation and Phoenix Energy Sales Company.
Roanoke Gas transported 2,827,789 MCF of natural gas to its
end-users for $1,739,602 in total transportation fees. Bluefield
Gas transported 66,055 MCF of natural gas to its end-users for
$45,985 in transportation fees. Highland Gas Marketing purchased
and delivered 2,227,942 MCF of natural gas to Roanoke Gas Company
and Bluefield Gas Company for delivery to certain end-users for
$6,310,564.
4. (a through e) Not applicable. The Company holds no interest, directly
or indirectly in an exempt wholesale generator (EWG) or foreign utility company.
A consolidating statement of income and surplus and a consolidating
balance sheet of RGC Resources, Inc. and its subsidiaries for the 1999 calendar
year is attached as Exhibit A and Exhibit A(1).
<PAGE>
The above-named claimant has caused this statement to be duly executed
on its behalf by its authorized officer on this 29th day of February, 2000.
RGC RESOURCES, INC.
By: s/John B. Williamson, III
Its: President
(SEAL)
ATTEST:
s/Roger L. Baumgardner
Secretary
Notices and correspondence regarding this statement should be addressed to:
Roger L. Baumgardner
Vice President-Secretary & Treasurer
RGC Resources, Inc.
Post Office Box 13007
Roanoke, VA 24030
<PAGE>
<TABLE>
<CAPTION>
Exhibit A
RGC Resources, Inc. and Subsidiaries
Consolidating Statement Of Earnings
Twelve Months Ended December 31, 1999
Roanoke Bluefield Highland Highland
RGC Gas Gas Propane Gas Highland Consolidated
Resources Company Company Company Marketing GIS Cox Eliminations Total
-------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
OPERATING REVENUES:
Gas utilities $45,014,937 $5,902,500 ($1,049,947) $49,867,490
Propane operations 0 $9,196,882 9,196,882
-------------------------------------------------------------------------------------------------
Total operating revenues 0 45,014,937 5,902,500 9,196,882 0 (1,049,947) 59,064,372
COST OF GAS:
Gas utilities 27,260,724 4,283,096 (1,020,279) 30,523,541
Propane operations 0 4,269,142 4,269,142
-------------------------------------------------------------------------------------------------
Total cost of gas 0 27,260,724 4,283,096 4,269,142 0 (1,020,279) 34,792,683
OPERATING MARGIN 0 17,754,213 1,619,404 4,927,740 0 (29,668) 24,271,689
-------------------------------------------------------------------------------------------------
OTHER OPERATING EXPENSES:
Gas utilities:
Other operations 6,603,289 445,658 (13,375) 7,035,572
Maintenance 1,019,479 61,457 1,080,936
Taxes - general 2,047,317 270,549 2,317,866
Taxes - income 1,207,454 183,964 1,391,418
Depreciation and amortization 2,873,008 220,778 (17,609) 3,076,177
Propane operations 0 4,251,796 (4,536) 4,247,260
-------------------------------------------------------------------------------------------------
Total other operating expenses 0 13,750,547 1,182,406 4,251,796 0 0 0 (35,520) 19,149,229
OPERATING EARNINGS 0 4,003,666 436,998 675,944 0 0 0 5,852 5,122,460
OTHER INCOME (DEDUCTIONS):
Gas utilities 1,002,000 86,653 (6,032) (1,008,424) 74,197
Propane and other operations, net 0 11,480 83,215 (11,782) (5,485) 77,428
Taxes - income (39,756) 2,246 (37,510)
-------------------------------------------------------------------------------------------------
Total other income and deductions 1,002,000 46,897 (3,786) 11,480 83,215 (11,782) (5,485) (1,008,424) 114,115
EARNINGS BEFORE INTEREST CHARGES 1,002,000 4,050,563 433,212 687,424 83,215 (11,782) (5,485) (1,002,572) 5,236,575
INTEREST CHARGES:
Gas utilities:
Long-term debt 1,478,818 96,909 1,575,727
Other interest 166,337 86,097 252,434
Propane operations 0 329,025 (6,424) 322,601
-------------------------------------------------------------------------------------------------
Total interest charges 0 1,645,155 183,006 329,025 0 0 0 (6,424) 2,150,762
NET EARNINGS $1,002,000 $2,405,408 $250,206 $358,399 $83,215($11,782)($5,485) ($996,148) $3,085,813
=================================================================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
RGC RESOURCES, INC. AND SUBSIDIARIES Exhibit A(1)
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1999
Roanoke Bluefield Highland Highland
RGC Gas Gas Propane Gas Highland Consolidated
ASSETS Resources Company Company Company Marketing GIS Cox Eliminations Total
- ------ --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
UTILITY PLANT:
Utility Plant in Service $71,511,489 $5,825,507 $(1,636,290) $75,700,706
Accumulated Depreciation (26,624,784)(2,049,719) 1,579,478 (27,095,025)
--------------------------------------------------------------------------------------------------------
Utility Plant in Service, Net - 44,886,705 3,775,788 - - - - (56,812) 48,605,681
Construction Work-In-Progress 1,038,063 163,666 1,201,729
--------------------------------------------------------------------------------------------------------
Utility Plant, Net - 45,924,768 3,939,454 - - - - (56,812) 49,807,410
--------------------------------------------------------------------------------------------------------
Investment in Subsidiaries 24,794,854 500 (24,795,354) -
NONUTILITY PROPERTY:
Propane 14,817,756 20,000 (209,764) 14,627,992
Accumulated Depreciation (4,490,224) 249,460 (4,240,764)
--------------------------------------------------------------------------------------------------------
Nonutility Property, Net - - - 10,327,532 - 20,000 - 39,696 10,387,228
--------------------------------------------------------------------------------------------------------
Cash and Cash Equivalents 708,532 (54,172) (8,360) 68,083 714,083
Accounts Receivable 14,340 7,050,824 764,659 1,345,631 1,021,488 (31,078) (2,839) 1,430,238 11,593,263
Inventories 5,675,138 1,122,430 244,837 7,042,405
Prepaid Income Taxes - -
Deferred Income Taxes - 2,133,275 2,133,275
Purchased Gas Adjustments (1,437,691) (19,803) 1,457,494 -
Other 3,785 323,310 40,889 282,648 (1,300) 649,332
--------------------------------------------------------------------------------------------------------
Total Current Assets 726,657 11,557,409 1,899,815 1,941,199 1,021,488 (31,078) (2,839) 5,019,707 22,132,358
--------------------------------------------------------------------------------------------------------
OTHER ASSETS 442,785 46,761 386,128 875,674
--------------------------------------------------------------------------------------------------------
TOTAL $25,521,511 $57,925,462 $5,886,030 $12,654,859 $1,021,488 $(11,078) $(2,839) $(19,792,763) $83,202,670
========================================================================================================
</TABLE>
<PAGE>
<TABLE>
<CAPTION>
RGC RESOURCES, INC. AND SUBSIDIARIES Exhibit A(1)
CONSOLIDATING BALANCE SHEET
DECEMBER 31, 1999
Roanoke Bluefield Highland Highland
RGC Gas Gas Propane Gas Highland Consolidated
LIABILITIES Resources Company Company Company Marketing GIS Cox Eliminations Total
- ----------- --------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C> <C>
CAPITALIZATION:
Stockholders' Equity:
Common Stock $9,190,805 $8,604,465 $49,704 $196,421 ($8,850,590) $9,190,805
Capital in Excess of
Par Value 9,576,795 5,578,753 220,564 833,662 (6,632,980) 9,576,794
Retained Earnings 6,303,696 8,063,382 1,704,940 3,061,891 362,276 (11,782) (5,485) (9,330,200) 10,148,718
--------------------------------------------------------------------------------------------------------
Total Stockholders' Equity 25,071,296 22,246,600 1,975,208 4,091,974 362,276 (11,782) (5,485) (24,813,770) 28,916,317
Long-Term Debt (Less
Current Maturities) 17,830,266 1,300,000 4,200,000 23,330,266
--------------------------------------------------------------------------------------------------------
Total Capitalization 25,071,296 40,076,866 3,275,208 8,291,974 362,276 (11,782) (5,485) (24,813,770) 52,246,583
--------------------------------------------------------------------------------------------------------
CURRENT LIABILITIES:
Current Maturities of
Long-term Debt 24,723 24,723
Borrowings under
Lines of Credit 7,009,000 1,284,000 2,314,000 10,607,000
Dividends Payable 511,965 - 511,965
Accounts Payable (61,752) 4,651,944 582,584 1,154,819 594,920 704 2,646 1,430,238 8,356,103
Income Taxes Payable 106,799 251,801 144,762 64,292 567,654
Customers' Deposits 542,735 65,620 865 609,220
Accrued Expenses 2 3,747,826 354,845 251,488 4,354,161
Refunds From Suppliers
- Due Customers 290,603 - 290,603
Purchased Gas Adjustments - 1,457,494 1,457,494
--------------------------------------------------------------------------------------------------------
Total Current Liabilities 450,215 16,373,630 2,538,850 3,865,934 659,212 704 2,646 2,887,732 26,778,923
DEFERRED CREDITS AND OTHER LIABILITIES:
Deferred Income Taxes 1,083,077 59,987 496,951 2,133,275 3,773,290
Deferred Investment Tax Credits 391,889 11,985 403,874
-
--------------------------------------------------------------------------------------------------------
Total Deferred Credits
and Other Liabilities - 1,474,966 71,972 496,951 - - - 2,133,275 4,177,164
--------------------------------------------------------------------------------------------------------
TOTAL $25,521,511 $57,925,462 $5,886,030 $12,654,859 $1,021,488 $(11,078) $(2,839) $(19,792,763) $83,202,670
========================================================================================================
</TABLE>
<PAGE>
EXHIBIT B
RGC RESOURCES, INC.
FINANCIAL DATA SCHEDULE
Item No. Caption Heading
1 Total Assets $83,202,670
2 Total Operating Revenues 59,064,372
3 Net Income 3,085,813
<PAGE>
EXHIBIT C
Not Applicable.
<TABLE> <S> <C>
<ARTICLE> OPUR3
<LEGEND>
THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM THE
CONSOLIDATING INCOME STATEMENTS OF RGC RESOURCES, INC. AND SUBSIDIARIES AND THE
CONSOLIDATING BALANCE SHEETS OF RGC RESOURCES, INC. AND SUBSIDIARIES FOR THE
YEAR ENDED DEC. 31, 1999 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH
FINANCIAL STATEMENTS.
</LEGEND>
<S> <C>
<PERIOD-TYPE> YEAR
<FISCAL-YEAR-END> SEP-30-2000
<PERIOD-END> DEC-31-1999
<BOOK-VALUE> PER-BOOK
<TOTAL-ASSETS> 83,202,670
<TOTAL-OPERATING-REVENUES> 59,064,372
<NET-INCOME> 3,085,813
</TABLE>
