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OMB APPROVAL
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OMB Number: 3235-0161
Expires: October 31, 2001
Estimated average burden
hours per response 3.5
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549
FORM U-3A-2
Statement by Holding Company Claiming Exemption Under
Rule U-3a-2 from the Provisions of
the Public Utility Holding Company Act Of 1935
YANKEE ENERGY SYSTEM, INC.
hereby files with the Securities and Exchange 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, and submits the following
information:
1. Yankee Energy System, Inc. ("Yankee Energy") is a corporation organized under
the laws of the State of Connecticut. Yankee Energy is the holding company for
Yankee Gas Services Company ("Yankee Gas"), a gas utility company, and five
non-utility subsidiaries, NorConn Properties, Inc. ("NorConn"), Yankee Energy
Financial Services Company ("Yankee Financial"), Yankee Energy Services Company
("YESCo"), R.M. Services, Inc. ("RMS"), and Housatonic Corporation. These
companies are referred to collectively herein as "the Yankee Energy System."
Yankee Energy's business essentially is confined to the ownership of its
subsidiaries. Yankee Gas, the principal subsidiary of Yankee Energy, is a
Connecticut corporation that purchases, distributes and sells natural gas at
retail in Connecticut.
Yankee Energy conducts non-utility operations through five
subsidiaries, NorConn, Yankee Financial, YESCo, RMS, and Housatonic Corporation.
All five non-utility subsidiaries are Connecticut corporations. NorConn was
formed in 1988 to hold non-utility property interests that may be acquired by
the Yankee Energy System. Yankee Financial, incorporated in 1992, provides
customers with financing for natural gas installations. YESCo is a full service
energy company providing fuel management, project development, and operations
and maintenance services at selected customer sites. YESCo also has three
divisions:
<PAGE>
YESCo Power Division, incorporated in 1997, designs, builds and maintains
on-site facilities for the production of thermal and/or electric power.
Currently, Yankee Energy is in the process of selling a substantial portion of
these assets. YESCo Controls Division, incorporated in November 1996,
specializes in the engineering, installation, and maintenance of building
controls product for commercial and industrial customers.
YESCo Mechanical Services Division, acquired by YESCo in July 1996,
operates in Connecticut and Massachusetts and provides comprehensive HVAC,
boiler and refrigeration equipment services and installation. RMS was formed in
1994 to provide debt collection service to utilities and other businesses
nationwide. Housatonic Corporation was incorporated in 1987 to acquire, own,
hold and manage an undivided general partnership interest in Iroquois Gas
Transmission System, a general partnership organized under the laws of the State
of New York.
Yankee Energy and Yankee Gas are predominantly intrastate in character.
2. Yankee Gas purchases, distributes and sells natural gas to approximately
185,000 residential, commercial and industrial users in Connecticut. Its service
territory consists of 69 cities and towns, and covers approximately 1,961 square
miles, all in Connecticut.
Yankee Gas' assets include distribution lines (mains and services),
meters, pumps, valves and pressure and flow controllers, all located in
Connecticut. Yankee Gas owns approximately 2,841 miles of distribution mains,
134,166 service lines, and 188,547 active meters for customer use, all located
in Connecticut. Yankee Gas also owns various propane facilities and seven gas
storage holders, all located in Connecticut. Yankee Gas also contracts for
storage capacity with other energy and pipeline companies.
3. The following information is for the calendar year 1999.
a. Number of Mcf of natural or manufactured gas distributed at retail:
47,875,909. The associated revenues are $280,922,849.
b. Number of Mcf of natural gas distributed at retail outside the State
of Connecticut: None.
c. Number of Mcf of natural gas sold at wholesale outside of the State of
Connecticut, or at the boundary of
<PAGE>
the State of Connecticut: None.
d. Number of Mcf of natural or manufactured gas purchased outside the
State of Connecticut, or at the Connecticut state line: In 1999, Yankee Gas
purchased 6,865,407 Mcf of natural gas. All gas purchased is ultimately
delivered to Connecticut via interstate pipelines. The associated expenses are
$17,761,108.
4. None.
Exhibit A
Attached as Exhibit A is a consolidating statement of income and
surplus for Yankee Energy and its subsidiaries for the last calendar year,
together with a consolidating balance sheet for Yankee Energy and its
subsidiaries as of the close of the last calendar year.
Exhibit B
Attached as Exhibit B is a Financial Data Schedule which sets forth 1.
Total Assets, 2. Total Operating Revenues, and 3. Net Income applicable to
Yankee Energy and its subsidiaries on a consolidated basis.
Exhibit C
None.
<PAGE>
The above-named claimant has caused this statement to be duly executed
on its behalf by an authorized officer on this 28th day of February, 2000.
YANKEE ENERGY SYSTEM, INC.
By: s/Mary J. Healey
Mary J. Healey
Vice President, General Counsel and Secretary
SEAL
ATTEST: s/Cristi C. Walker
Name: Cristi C. Walker
Title: Attorney
Name, title and address of officer to whom notices and correspondence
concerning this statement should be addressed:
Mary J. Healey
Vice President, General Counsel and Secretary
Yankee Energy System, Inc.
599 Research Parkway
Meriden, CT 06450
<PAGE>
YANKEE ENERGY SYSTEM, INC. AND SUBSIDIARIES Exhibit A
CONSOLIDATING STATEMENTS OF INCOME (a) Page 1 of 4
TWELVE MONTHS ENDED DECEMBER 31, 1999
<TABLE>
<CAPTION>
YANKEE YANKEE
ENERGY GAS NORCONN
SYSTEM SERVICES PROPERTIES HOUSATONIC
(parent) COMPANY INC. CORPORATION
----------------------------------------------------------------------
<S> <C> <C> <C> <C>
OPERATING REVENUES $280,923 $1,175
LESS: COST OF GAS 134,277
COST OF SALES
----------------------------------------------------------------------
REVENUES, NET OF COST OF GAS 146,646 1,175
----------------------------------------------------------------------
OTHER OPERATING EXPENSES:
OPERATIONS 4,414 56,664 166 0
MAINTENANCE 6,514
DEPRECIATION 0 20,423 255
FEDERAL AND STATE INCOME TAXES 0 14,071 (21) 0
TAXES OTHER THAN INCOME TAXES 20,431 0
----------------------------------------------------------------------
TOTAL OTHER OPERATING EXPENSES 4,414 118,103 400 0
----------------------------------------------------------------------
----------------------------------------------------------------------
OPERATING INCOME (LOSS) (4,414) 28,543 775 0
----------------------------------------------------------------------
OTHER INCOME, (EXPENSE) NET:
ALLOWANCE FOR OTHER FUNDS USED
DURING CONSTRUCTION 436
EQUITY IN EARNINGS OF SUBSIDIARIES 16,140
FEDERAL AND STATE INCOME TAXES 1,138 1,295 (189)
OTHER, NET 341 (377)
----------------------------------------------------------------------
OTHER INCOME, (EXPENSE) NET 17,619 1,354 (189) 0
----------------------------------------------------------------------
----------------------------------------------------------------------
INCOME (LOSS) BEFORE INTEREST CHARGES 13,205 29,897 586 0
----------------------------------------------------------------------
INTEREST CHARGES:
INTEREST ON LONG-TERM DEBT 12,929 332
OTHER INTEREST 1,010 2,020 6
ALLOWANCE FOR BORROWED FUNDS
USED DURING CONSTRUCTION (742)
----------------------------------------------------------------------
INTEREST CHARGES, NET 1,010 14,207 338 0
----------------------------------------------------------------------
NET INCOME (LOSS) $12,195 $15,690 $248 $0
======================================================================
</TABLE>
<TABLE>
<CAPTION>
YANKEE
ENERGY YANKEE
FINANCIAL ENERGY RM
SERVICES SERVICES, INC. SERVICES, ELIMINA- CONSOLI-
COMPANY CONSOL. INC. TIONS DATED
--------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
OPERATING REVENUES 257 23,724 6,531 $3,268 $309,342
LESS: COST OF GAS 134,277
COST OF SALES 18,549 3,470 22,019
--------------------------------------------------------------------------------------
REVENUES, NET OF COST OF GAS 257 5,175 3,061 3,268 153,046
--------------------------------------------------------------------------------------
OTHER OPERATING EXPENSES:
OPERATIONS 96 5,565 1,508 3,268 65,145
MAINTENANCE 6,514
DEPRECIATION 200 1,213 307 22,398
FEDERAL AND STATE INCOME TAXES 6 0 (37) 14,019
TAXES OTHER THAN INCOME TAXES 0 0 3 20,434
--------------------------------------------------------------------------------------
TOTAL OTHER OPERATING EXPENSES 302 6,778 1,781 3,268 128,510
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
OPERATING INCOME (LOSS) (45) (1,603) 1,280 0 24,536
--------------------------------------------------------------------------------------
OTHER INCOME, (EXPENSE) NET:
ALLOWANCE FOR OTHER FUNDS USED
DURING CONSTRUCTION 436
EQUITY IN EARNINGS OF SUBSIDIARIES 16,140 0
FEDERAL AND STATE INCOME TAXES (40) 1,765 (528) 3,441
OTHER, NET 183 347 1,352 (858)
--------------------------------------------------------------------------------------
OTHER INCOME, (EXPENSE) NET 143 2,112 (528) 17,492 3,019
--------------------------------------------------------------------------------------
--------------------------------------------------------------------------------------
INCOME (LOSS) BEFORE INTEREST CHARGES 98 509 752 17,492 27,555
--------------------------------------------------------------------------------------
INTEREST CHARGES:
INTEREST ON LONG-TERM DEBT 0 13,261
OTHER INTEREST 30 1,090 38 1,352 2,842
ALLOWANCE FOR BORROWED FUNDS 0
USED DURING CONSTRUCTION 0 (742)
--------------------------------------------------------------------------------------
INTEREST CHARGES, NET 30 1,090 38 1,352 15,361
--------------------------------------------------------------------------------------
NET INCOME (LOSS) $68 ($581) $714 $16,140 $12,194
======================================================================================
</TABLE>
(a) Unaudited
NOTE: Individual columns may not add to Consolidated amount due to rounding.
<PAGE>
YANKEE ENERGY SYSTEM, INC. AND SUBSIDIARIES Exhibit A
CONSOLIDATING BALANCE SHEETS (a) Page 2 of 4
ASSETS
AT DECEMBER 31, 1999
(THOUSANDS OF DOLLARS)
<TABLE>
<CAPTION>
YANKEE
YANKEE YANKEE ENERGY
ENERGY GAS NORCONN FINANCIAL
SYSTEM SERVICES PROPERTIES HOUSATONIC SERVICES
(parent) COMPANY INC. CORPORATION COMPANY
- ------------------------------------------------------------------------------------------------------------------------------------
ASSETS
<S> <C> <C> <C> <C> <C>
UTILITY PLANT, AT ORIGINAL COST $595,243
LESS: ACCUMULATED PROVISION
FOR DEPRECIATION 228,035
------------------------------------------------------------------------------------
367,208
CONSTRUCTION WORK IN PROGRESS 13,692
------------------------------------------------------------------------------------
TOTAL NET UTILITY PLANT 380,900
------------------------------------------------------------------------------------
OTHER PROPERTY AND INVESTMENTS:
OTHER PROPERTY 174 6,179 339
INVESTMENTS IN SUBSIDIARY
COMPANIES, AT EQUITY 179,494
OTHER INVESTMENTS 120
------------------------------------------------------------------------------------
TOTAL OTHER PROPERTY AND INVESTMENTS 179,494 294 6,179 0 339
------------------------------------------------------------------------------------
CURRENT ASSETS:
CASH 883 2,591 27 0
ACCOUNTS RECEIVABLE, NET 23,466 47,160 96 10 1,708
FUEL SUPPLIES 1,459
OTHER MATERIAL & SUPPLIES 1,214
DEFERRED GAS COSTS, CURRENT 0
ACCRUED UTILITY REVENUES 21,143
PREPAYMENTS AND OTHER 63 14,368 6
------------------------------------------------------------------------------------
TOTAL CURRENT ASSETS 24,412 87,935 123 10 1,714
------------------------------------------------------------------------------------
UNAMORTIZED DEBT EXPENSE 1,401 11
DEFERRED GAS COSTS AND OTHER (902) 6,130 0
RECOVERABLE ENVIRONMENTAL
CLEANUP COSTS 34,077
RECOVERABLE INCOME TAXES 2,808
RECOVERABLE POSTRETIREMENT
BENEFIT COSTS 1,625
OTHER DEFERRED DEBITS 12,628 0 94
------------------------------------------------------------------------------------
TOTAL ASSETS $203,004 $527,798 $6,313 $10 $2,147
====================================================================================
</TABLE>
<TABLE>
<CAPTION>
YANKEE
ENERGY RM
SERVICES SERVICES ELIMINA- CONSOLI-
COMPANY COMPANY TIONS DATED
- --------------------------------------------------------------------------------------------------------------
ASSETS
<S> <C> <C> <C> <C>
UTILITY PLANT, AT ORIGINAL COST $595,243
LESS: ACCUMULATED PROVISION
FOR DEPRECIATION 228,035
--------------------------------------------------------------------
367,208
CONSTRUCTION WORK IN PROGRESS 13,692
--------------------------------------------------------------------
TOTAL NET UTILITY PLANT 380,900
--------------------------------------------------------------------
OTHER PROPERTY AND INVESTMENTS:
OTHER PROPERTY 6,743 2,597 16,032
INVESTMENTS IN SUBSIDIARY
COMPANIES, AT EQUITY 179,494 0
OTHER INVESTMENTS 5,204 5,324
--------------------------------------------------------------------
TOTAL OTHER PROPERTY AND INVESTMENTS 11,947 2,597 179,494 21,356
--------------------------------------------------------------------
CURRENT ASSETS:
CASH 3 8 3,512
ACCOUNTS RECEIVABLE, NET 8,560 1,259 29,073 53,186
FUEL SUPPLIES 1,459
OTHER MATERIAL & SUPPLIES 654 1,868
DEFERRED GAS COSTS, CURRENT 0
ACCRUED UTILITY REVENUES 21,143
PREPAYMENTS AND OTHER 38 3 14,478
--------------------------------------------------------------------
TOTAL CURRENT ASSETS 9,255 1,270 29,073 95,646
--------------------------------------------------------------------
UNAMORTIZED DEBT EXPENSE 1,412
DEFERRED GAS COSTS AND OTHER 0 0 5,228
RECOVERABLE ENVIRONMENTAL
CLEANUP COSTS 34,077
RECOVERABLE INCOME TAXES 2,808
RECOVERABLE POSTRETIREMENT
BENEFIT COSTS 1,625
OTHER DEFERRED DEBITS 11,568 30 24,320
--------------------------------------------------------------------
TOTAL ASSETS $32,770 $3,897 $208,567 $567,372
====================================================================
</TABLE>
(a) Unaudited
NOTE: Individual columns may not add to Consolidated amount due to rounding.
<PAGE>
YANKEE ENERGY SYSTEM, INC. AND SUBSIDIARIES
CONSOLIDATING BALANCE SHEETS (a)
CAPITALIZATION AND LIABILITIES
Exhibit A
AT DECEMBER 31, 1999 Page 3 of 4
(THOUSANDS OF DOLLARS)
<TABLE>
<CAPTION>
YANKEE
YANKEE YANKEE ENERGY
ENERGY GAS NORCONN FINANCIAL
SYSTEM SERVICES PROPERTIES HOUSATONIC SERVICES
(parent) COMPANY INC. CORPORATION COMPANY
- ------------------------------------------------------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
CAPITALIZATION:
COMMON SHAREHOLDERS' EQUITY $171,724 $160,241 $1,084 $10 $1,269
LONG-TERM DEBT, NET OF CURRENT PORTION 0 158,050 5,000
---------------------------------------------------------------------------------------
TOTAL CAPITALIZATION 171,724 318,291 6,084 10 1,269
---------------------------------------------------------------------------------------
CURRENT LIABILITIES:
NOTES PAYABLE TO ASSOCIATED COMPANIES 1,500 0 (83) 0 531
NOTES PAYABLE TO BANKS 24,500 52,000
LONG-TERM DEBT, CURRENT PORTION 0 950 250
ACCOUNTS PAYABLE 5,352 19,252 40 0 89
ACCRUED TAXES (599) 9,848 115 0 15
ACCRUED INTEREST 152 4,220 30
PIPELINE TRANSITION COSTS 1,298
OTHER CURRENT LIABILITIES 3,533 1
---------------------------------------------------------------------------------------
TOTAL CURRENT LIABILITIES 30,905 91,101 352 0 636
---------------------------------------------------------------------------------------
ACCUM DEFERRED INCOME TAXES 65,444 (123) (29)
ACCUM DEFERRED INVESTMENT TAX CREDITS 7,854
RESERVE FOR ENVIRONMENTAL
CLEANUP COSTS 35,000
POSTRETIREMENT BENEFIT OBLIGATION 4,080
OTHER DEFERRED CREDITS 375 6,028 0 271
---------------------------------------------------------------------------------------
TOTAL CAPITALIZATION AND LIABILITIES $203,004 $527,798 $6,313 $10 $2,147
=======================================================================================
0 0 0 0 0
</TABLE>
<TABLE>
<CAPTION>
YANKEE
ENERGY RM
SERVICES, INC SERVICES ELIMINA- CONSOLI-
CONSOL. COMPANY TIONS DATED
- -----------------------------------------------------------------------------------------------------------------
CAPITALIZATION:
<S> <C> <C> <C> <C>
COMMON SHAREHOLDERS' EQUITY $12,443 $1,277 $179,494 $168,554
LONG-TERM DEBT, NET OF CURRENT PORTION 163,050
-------------------------------------------------------------------------
TOTAL CAPITALIZATION 12,443 1,277 179,494 331,604
-------------------------------------------------------------------------
CURRENT LIABILITIES:
NOTES PAYABLE TO ASSOCIATED COMPANIES 22,118 856 24,922 0
NOTES PAYABLE TO BANKS 76,500
LONG-TERM DEBT, CURRENT PORTION 1,200
ACCOUNTS PAYABLE (22) 199 4,142 20,768
ACCRUED TAXES (2,927) 511 6,963
ACCRUED INTEREST 0 9 4,393
PIPELINE TRANSITION COSTS 1,298
OTHER CURRENT LIABILITIES 1,585 871 5,990
-------------------------------------------------------------------------
TOTAL CURRENT LIABILITIES 20,754 2,437 29,073 117,112
-------------------------------------------------------------------------
ACCUM DEFERRED INCOME TAXES) (529) (20) 64,743
ACCUM DEFERRED INVESTMENT TAX CREDITS 7,854
RESERVE FOR ENVIRONMENTAL
CLEANUP COSTS 35,000
POSTRETIREMENT BENEFIT OBLIGATION 4,080
OTHER DEFERRED CREDITS 102 203 6,979
-------------------------------------------------------------------------
TOTAL CAPITALIZATION AND LIABILITIES $32,770 $3,897 $208,567 $567,372
=========================================================================
0 0 0 0
</TABLE>
(a) Unaudited
NOTE: Individual columns may not add to Consolidated amount due to rounding.
<PAGE>
YANKEE ENERGY SYSTEM, INC. AND SUBSIDIARIES Exhibit A
CONSOLIDATING STATEMENTS OF COMMON SHAREHOLDERS' EQUITY (a) Page 4 of 4
TWELVE MONTHS ENDED DECEMBER 31, 1999
(THOUSANDS OF DOLLARS)
<TABLE>
<CAPTION>
YANKEE
YANKEE YANKEE ENERGY
ENERGY GAS NORCONN FINANCIAL
SYSTEM SERVICES PROPERTIES HOUSATONIC SERVICES
(parent) COMPANY INC. CORPORATION COMPANY
-------------------------------------------------------------------------------------
<S> <C> <C> <C> <C> <C>
COMMON SHARES $53,164 $5 $1 $10 $1
CAPITAL SURPLUS, PAID IN 93,090 80,780 579 921
RETAINED EARNINGS 27,625 79,456 504 0 347
EMPLOYEE STOCK OWNERSHIP
PLAN GUARANTEE 0
CAPITAL STOCK EXPENSE (2,155)
-------------------------------------------------------------------------------------
$171,724 $160,241 $1,084 $10 $1,269
=====================================================================================
</TABLE>
<TABLE>
<CAPTION>
YANKEE
ENERGY RM
SERVICES, INC. SERVICES ELIMINA- CONSOLI-
CONSOL. COMPANY TIONS DATED
---------------------------------------------------------------------
<S> <C> <C> <C> <C>
COMMON SHARES $1 $1 $19 $53,164
CAPITAL SURPLUS, PAID IN 23,922 693 106,896 $93,089
RETAINED EARNINGS (11,480) 583 72,579 $24,456
EMPLOYEE STOCK OWNERSHIP
PLAN GUARANTEE $0
CAPITAL STOCK EXPENSE ($2,155)
-------------------------------------------------------------------------
$12,443 $1,277 $179,494 $168,554
=====================================================================
</TABLE>
(a) Unaudited
NOTE: Individual columns may not add to Consolidated amount due to rounding.
<PAGE>
EXHIBIT 99.B
YANKEE ENERGY SYSTEM, INC. AND SUBSIDIARIES
FINANCIAL DATA SCHEDULE
<TABLE>
<CAPTION>
<S> <C>
1. TOTAL ASSETS: $ 567,372,000
2. TOTAL OPERATING REVENUE: $ 309,342,000
3. NET INCOME: $ 12,194,000
</TABLE>
