SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
FORM 8-K
CURRENT REPORT
Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934
Date of Report (Date of Earliest Event Reported) - DECEMBER 19, 2006
ALLETE, INC.
(Exact name of registrant as specified in its charter)
MINNESOTA 1-3548 41-0418150
(State or other jurisdiction of (Commission File Number) (IRS Employer
incorporation or organization) Identification No.)
30 WEST SUPERIOR STREET
DULUTH, MINNESOTA 55802-2093
(Address of principal executive offices, including zip code)
(218) 279-5000
(Registrant's telephone number, including area code)
Check the appropriate box below if the Form 8-K filing is intended to
simultaneously satisfy the filing obligation of the registrant under any of the
following provisions:
/ / Written communications pursuant to Rule 425 under the Securities Act (17 CFR
230.425)
/ / Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR
240.14a-12)
/ / Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange
Act (17 CFR 240.14d-2(b))
/ / Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange
Act (17 CFR 240.13e-4(c))
SECTION 8 - OTHER EVENTS
ITEM 8.01 OTHER EVENTS.
Reference is made to ALLETE, Inc.'s (ALLETE or Company) Annual Report on Form
10-K for the year ended December 31, 2005 (2005 Form 10-K), for background
information on the following updates.
Ref. Page 10 - Third Full Paragraph, Eighth and Ninth Full Paragraphs
Ref. Page 42 - Seventh and Eight Paragraphs
Ref. Page 43 - First Paragraph Ref. Page 77 - Third and Fourth Paragraphs
Ref. Form 10-Q for the quarter ended March 31, 2006, Page 16 - Fifth and Sixth
Paragraphs
Ref. Form 10-Q for the quarter ended March 31, 2006, Page 25 - Fifth Paragraph
Ref. Form 10-Q for the quarter ended March 31, 2006, Page 33 - First Paragraph
Ref. Form 10-Q for the quarter ended June 30, 2006, Page 19 - Fifth and Sixth
Paragraphs
Ref. Form 10-Q for the quarter ended June 30, 2006, Page 33 - Fourth Paragraph
Ref. Form 10-Q for the quarter ended September 30, 2006, Page 20 - Fifth and
Sixth Paragraphs
Ref. Form 10-Q for the quarter ended September 30, 2006, Page 34 - Second Full
Paragraph
On December 20, 2006, the Minnesota Public Utilities Commission (MPUC) issued an
order which allows Minnesota Power, an operating division of ALLETE, to continue
recovering Midwest Independent Transmission System Operation, Inc. (MISO) Day 2
charges through the Company's Minnesota retail automatic fuel adjustment
recovery mechanism (fuel clause) except for MISO Day 2 administrative charges.
The order grants deferred accounting treatment for three MISO charge types that
were determined to be administrative charges and therefore not currently
recoverable through the fuel clause. Over the next 12 months, Minnesota Power
will adjust customer bills to recognize approximately $2 million of
administrative charges previously collected through the fuel clause between
April 1, 2005, and December 31, 2006, and record these administrative charges as
a regulatory asset. Minnesota Power is permitted to continue accumulating MISO
Day 2 administrative charges after December 31, 2006, as a regulatory asset
until it files its next rate case, at which time recovery for such charges will
be determined. There will be no impact on earnings as a result of this ruling.
The MISO Day 2 energy market is the market through which Minnesota Power engages
in wholesale energy transactions in MISO's day-ahead and real-time markets. The
MISO Day 2 market began operations on April 1, 2005. Minnesota Power had been
recovering all MISO Day 2 charges through its fuel clause subject to two
interim orders from the MPUC that had allowed such collection subject to refund.
This order removes the subject to refund requirement of the two interim orders,
and includes extensive fuel clause reporting requirements that will be reviewed
in Minnesota Power's monthly and annual fuel clause filing to the MPUC.
As a result of the MPUC's order allowing recovery of nearly all MISO Day 2
charges through the fuel clause, Minnesota Power will revoke its December 2005
Letter of Intent to Withdraw from MISO.
Ref. Page 16 - Fifth Full Paragraph
Ref. Page 46 - Second Paragraph
Ref. Form 10-Q for the quarter ended September 30, 2006, Page 35 - Fifth
Paragraph
On December 19, 2006, ALLETE Properties, Inc. (ALLETE Properties), a
wholly-owned subsidiary of ALLETE, received development order approval from the
City of Ormond Beach for its 6,000-acre Ormond Crossings project (Ormond
Crossings). This development order is a key approval necessary to develop up to
3,700 residential units and 5 million commercial square feet within Ormond
Crossings.
Most of Ormond Crossings is located in the City of Ormond Beach in Volusia
County; the remainder of the development is an adjacent piece of unincorporated
land in neighboring Flagler County. A development order from Flagler County is
under review by the Flagler County Commission. If approved, Ormond Crossings
would receive entitlements for up to 700 additional residential units.
1 ALLETE Form 8-K dated December 21, 2006
ITEM 8.01 OTHER EVENTS. (CONTINUED)
After an agreement has been finalized with the Florida Department of
Transportation concerning traffic impact mitigation, ALLETE Properties'
management will determine the best economic build-out of the project. Targeted
build-out of Ormond Crossings will consider market demand as well as
infrastructure and mitigation costs. The agreement is expected to be finalized
during the first half of 2007. Sale of property within Ormond Crossings is
expected to commence in 2009.
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READERS ARE CAUTIONED THAT FORWARD-LOOKING STATEMENTS SHOULD BE READ IN
CONJUNCTION WITH ALLETE'S DISCLOSURES UNDER THE HEADING: "SAFE HARBOR STATEMENT
UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995" LOCATED ON PAGE 3 OF
THIS FORM 8-K.
ALLETE Form 8-K dated December 21, 2006 2
SAFE HARBOR STATEMENT
UNDER THE PRIVATE SECURITIES LITIGATION REFORM ACT OF 1995
In connection with the safe harbor provisions of the Private Securities
Litigation Reform Act of 1995, ALLETE is hereby filing cautionary statements
identifying important factors that could cause ALLETE's actual results to differ
materially from those projected in forward-looking statements (as such term is
defined in the Private Securities Litigation Reform Act of 1995) made by or on
behalf of ALLETE in this Current Report on Form 8-K, in presentations, in
response to questions or otherwise. Any statements that express, or involve
discussions as to expectations, beliefs, plans, objectives, assumptions or
future events or performance (often, but not always, through the use of words or
phrases such as "anticipates," "believes," "estimates," "expects," "intends,"
"plans," "projects," "will likely result," "will continue," "could," "may,"
"potential," "target," "outlook" or similar expressions) are not statements of
historical facts and may be forward-looking.
Forward-looking statements involve estimates, assumptions, risks and
uncertainties, which are beyond ALLETE's control and may cause actual results or
outcomes to differ materially from those that may be projected. These statements
are qualified in their entirety by reference to, and are accompanied by, the
following important factors, in addition to any assumptions and other factors
referred to specifically:
- ALLETE's ability to successfully implement its strategic objectives;
- ALLETE's ability to manage expansion and integrate acquisitions;
- prevailing governmental policies and regulatory actions, including those
of the United States Congress, state legislatures, the Federal Energy
Regulatory Commission, the Minnesota Public Utilities Commission, the
Public Service Commission of Wisconsin, various local and county
regulators, and city administrators, about allowed rates of return,
financings, industry and rate structure, acquisition and disposal of
assets and facilities, real estate development, operation and construction
of plant facilities, recovery of purchased power and capital investments,
present or prospective wholesale and retail competition (including but not
limited to transmission costs), and zoning and permitting of land held for
resale;
- effects of restructuring initiatives in the electric industry;
- economic and geographic factors, including political and economic risks;
- changes in and compliance with environmental and safety laws and policies;
- weather conditions;
- natural disasters and pandemic diseases;
- war and acts of terrorism;
- wholesale power market conditions;
- population growth rates and demographic patterns;
- effects of competition, including competition for retail and wholesale
customers;
- pricing and transportation of commodities;
- changes in tax rates or policies or in rates of inflation;
- unanticipated project delays or changes in project costs;
- unanticipated changes in operating expenses and capital expenditures;
- global and domestic economic conditions;
- ALLETE's ability to access capital markets;
- changes in interest rates and the performance of the financial markets;
- ALLETE's ability to replace a mature workforce, and retain qualified,
skilled and experienced personnel; and
- the outcome of legal and administrative proceedings (whether civil or
criminal) and settlements that affect the business and profitability of
ALLETE.
Additional disclosures regarding factors that could cause ALLETE's results and
performance to differ from results or performance anticipated by this report are
discussed under the heading "Risk Factors" in Part I, Item 1A of ALLETE's 2005
Form 10-K and Part II, Item 1A of ALLETE's Quarterly Reports on Form 10-Q for
the quarterly period ended March 31, 2006. Any forward-looking statement speaks
only as of the date on which such statement is made, and ALLETE undertakes no
obligation to update any forward-looking statement to reflect events or
circumstances after the date on which that statement is made or to reflect the
occurrence of unanticipated events. New factors emerge from time to time, and it
is not possible for management to predict all of these factors, nor can it
assess the impact of each of these factors on the businesses of ALLETE or the
extent to which any factor, or combination of factors, may cause actual results
to differ materially from those contained in any forward-looking statement.
Readers are urged to carefully review and consider the various disclosures made
by ALLETE in this Form 8-K and in its other reports filed with the Securities
and Exchange Commission that attempt to advise interested parties of the factors
that may affect ALLETE's business.
3 ALLETE Form 8-K dated December 21, 2006
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.
ALLETE, Inc.
December 21, 2006 Mark A. Schober
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Mark A. Schober
Senior Vice President and Chief Financial Officer
ALLETE Form 8-K dated December 21, 2006 4