General Motors shareholders would be left with just one per cent of company stock under a restructuring plan the automaker has advanced. GM says it will ask the government to take more than half its stock in exchange for half of GM’s government debt. The restructuring also means the end of 21,000 factory jobs by next year and the demise of its Pontiac line of vehicles. The struggling automaker says it will offer 225 shares of common stock for every $1,000 in notes held by bondholders as part of a debt-for-equity swap that aims to retire most of GM’s $27 billion in unsecured debt. The announcements came in a filing with the Securities and Exchange Commission. GM faces a June 1st deadline to restructure and get more government money to avoid filing for bankruptcy protection.
Chrysler Chief Executive Robert Nardelli is telling employees that management is doing all it can to get more government aid and save their jobs. Nardelli says in an e-mail that management’s number one priority is to preserve Chrysler and the livelihoods of its 54,000 employees. He also says Chrysler owner Cerberus Capital Management is working with former owner Daimler to divest itself of a 19.9 per cent stake in Chrysler. Chrysler has reached concession deals with its U.S. and Canadian unions and is nearing a partnership deal with Fiat, but it is far from a debt-reduction deal with creditors. The company faces an April 30th government deadline to finish restructuring.
The Audit Bureau of Circulations said that average daily circulation declined 7.1 per cent in the October-March period from the same six-month span in 2007-2008. That was faster than the 4.6 per cent fall recorded in the April-September period of 2008. Sunday circulation fell 5.4 percent in the latest period. Circulation at the Houston Chronicle fell 13.2 per cent daily and 7.8 per cent on Sundays. USA Today remains the number one newspaper, though its circulation dropped 7.5 per cent after several periods with little change. Newspaper sales have been declining since the early 1990s, but the drop has accelerated in recent years. Circulation revenue has largely held up, though, because of price increases.
Houston is on EPA’s list of the nation’s top green power purchasers. The list is led by Intel, PepsiCo, Kohl’s, Dell, Whole Foods Market, Pepsi Bottling Group, Johnson & Johnson, U.S. Air Force, Cisco Systems, and then the City of Houston. The nation’s top 50 purchasers are buying more than 11 billion kilowatt-hours of green power annually. Green power is generated from renewable resources such as solar, wind, geothermal, biomass, biogas and low-impact hydropower.
Galveston is putting together a list of Hurricane Ike recovery projects as the city prepares to allocate $267 million in federal relief funds. The Galveston County Daily News reported that most of the money is expected to go for housing rehabilitation projects. So far about 280 people signed up seeking assistance. Ike stormed ashore on September 13th, swamping about 75 per cent of the houses on the island. The Daily News reports only about two-thirds of property owners had flood insurance. The Galveston City Council on May 14th will discuss the proposed recovery projects.
The Countrywide brand has been officially retired by Bank of America. Bank of America acquired California-based Countrywide on July 1st, 2008, making the bank’s home loans unit the country’s largest mortgage lender. During the first quarter of 2009, Bank of America has funded $85 billion in first mortgages.
Secretary of State Hillary Rodham Clinton is telling representatives from 16 major world economies that the United States is moving quickly to address global warming. At an international forum on energy and climate change Monday, Clinton said the U.S. is fully engaged and no longer doubts the urgency or magnitude of the climate change problem. She cited the recent finding by the EPA that six greenhouse gases pose threats to human health and welfare as a sign that the Obama administration was taking action. The Major Economies Forum on Energy and Climate Change was announced in March by President Barack Obama. Its goal is to work toward a successful new international agreement to curb climate-changing pollution.
The head of the Federal Deposit Insurance Corporation says the government likely won’t need additional financial bailout funds in the immediate future. It’s a conclusion chairwoman Sheila Bair linked to the results of the recent “stress tests” on the nation’s 19 largest banks. Bair didn’t want to reveal the results due out next week, but says for now the treasury has what it needs. There is about $109 billion remaining in the government’s $700 billion financial rescue fund and treasury says it expects to get $25 billion in repayments from banks over the next year. Bair also called for a new system of regulation that prevents institutions from taking on excessive risk and becoming so big their collapse would endanger the financial system. She said the FDIC would be the ideal agency to take over and resolve the risky institutions.
The Treasury Department says it will need to borrow $361 billion in the current April-June quarter–a record amount for that period. It’s the third straight quarter the government’s borrowing needs have set records for those periods. The all-time high in borrowing needs for any quarter was $569 billion set in the October-December period. The huge borrowing needs reflect the soaring costs of the $700 billion financial rescue program and the recession.
The U.S. Fish and Wildlife Service is undertaking more than 129 construction, energy efficiency, habit restoration and other improvement projects at national wildlife refuges, fish hatcheries and other public and private lands. Secretary of the Interior Ken Salazar says the projects total about $29.9 million within the Southwest, including the Texas Gulf Coast. Projects include $1.7 million for continued Bahia Grande wetland restoration at Laguna Atascosa National Wildlife Refuge. It will cover the construction of two bridges and a low water crossing, designed to allow for better movement of wading and water birds.
The Port Commission of the Port of Houston Authority will consider nearly $4 million for Bayport Container Terminal projects at their meeting tomorrow. Commissioners are being asked to authorize a $600,000 construction contract to Forde Construction for a dust suppression system at the Turning Basin Terminal. The commission is also authorizing an application for American Recovery and Reinvestment Act funding, which must be expended no later than September 2010.
A Texas woman who claims she was raped by co-workers while working for a military contractor in Iraq is asking a federal appeals court to let a jury hear part of her case. The 5th U.S. Circuit Court of Appeals in New Orleans heard from lawyers on both sides of the civil case that Jamie Leigh Jones filed against Halliburton and several subsidiary companies. Halliburton says Jones signed an agreement that requires all of her claims against the companies to be resolved privately through arbitration, but a federal judge ruled that claims stemming from her alleged rape in 2005 at Camp Hope in Baghdad can be tried in open court. The three-judge panel that heard the case didn’t immediately rule on Halliburton’s appeal.
Gas prices in the United States are holding steady. That’s according to the national Lundberg survey of fuel prices. The average price of regular grade gasoline was $2.05 a gallon on Friday, when the two-week survey was completed. That’s less than a penny increase from April 10th. But the price is $1.42 below levels from the same time last year. The lowest price for gasoline in the U.S. was in Phoenix at $1.80 a gallon. The highest was in Anchorage, Alaska, at $2.45. The lowest price in California was $2.26 a gallon in Bakersfield and the highest was $2.33 in San Francisco. The average price in Los Angeles was $2.31.