Question-and-Answer Session
Operator
(Operator Instructions) Your first question comes from the line of Michael Lapides with Goldman Sachs. Please proceed.
Michael Lapides - Goldman Sachs
Hey, guys, look forward to seeing you next week in Arizona at EEI. Quick question for you. How does the KCC treat short-term debt, whether its commercial papers or letters of credit or anything else, in terms of dealing with the regulatory authorized capital structure in rates and revenue requirements?
Mark Ruelle
It has typically and traditionally and this settlement has been excluded from the capital structure.
Michael Lapides - Goldman Sachs
So you could issue some short-term debt necessary to finance it and then eventually either term it out as your equity layer grows with retained earnings or just eliminate it with equity?
Mark Ruelle
Sure. We view short-term debt as simply a transitional form of financing and that our long-term capital structure should be appropriately balanced with our rate base.
Michael Lapides - Goldman Sachs
Understood. Question a little bit on when we think about the '09 capital budgets. When I look at kind of your publicly disclosed CapEx plan and the supply plan, trying to think about what are the items that are most flexible. You laid it out in pretty decent detail. I didn't know if there were items whether its in the transmission bucket or whether it is in the $130 million-$140 million of refurbishment and other generation work where you have the most flexibility?
Mark Ruelle
I tell you, Michael, obviously we are pretty condensed business, we operate in a single state. The officers of the company sit around the same table every Monday morning and the whole team is looking at just that question right now. So its certainly includes what may be people would call the sort of the run of the mill maintenance kind of capital and it also includes some of the larger projects. Doug, do you want to shed any light on that?
Doug Sterbenz
Sure. This is Doug Sterbenz. I would say we have a great deal of flexibility. Certainly our growth plan that outlined in our comprehensive energy plan calls for very large projects. We're looking right now at scaling some of those back as needed. Also, our plan shows for a pretty large capital maintenance budget. Things that we would like to do to ensure good quality service going into the future but there is certainly other ways to handle that in the short run and we're having to looking at all those options right now.
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