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Short-Term and Long-Term Debt | 9 Months Ended
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Sep. 30, 2017
Debt Disclosure [Abstract] |
Short-Term and Long-Term Debt [Text Block] | SHORT-TERM AND LONG-TERM DEBT The following tables present the Company’s short-term and long-term debt as of September 30, 2017, and December 31, 2016:
September 30, 2017 | Principal |  |  | Unamortized Debt Issuance Costs |  | Total |
Millions |  |  |  |  |
Short-Term Debt |  | $64.6 |  |  | $(0.5) |  |  | $64.1 |
Long-Term Debt | 1,454.4 |  |  | (9.8) |  | 1,444.6 |
Total Debt |  | $1,519.0 |  |  | $(10.3) |  |  | $1,508.7 |
December 31, 2016 | Principal |  |  | Unamortized Debt Issuance Costs |  | Total |
Millions |  |  |  |  |
Short-Term Debt |  | $188.3 |  |  | $(0.6) |  |  | $187.7 |
Long-Term Debt | 1,380.8 |  |  | (10.4) |  | 1,370.4 |
Total Debt |  | $1,569.1 |  |  | $(11.0) |  |  | $1,558.1 |
On June 1, 2017, ALLETE issued $80.0 million of its senior unsecured notes (the Notes) to certain institutional buyers in the private placement market. The Notes were issued in reliance on an exemption from registration under Section 4(a)(2) of the Securities Act of 1933, as amended, to institutional accredited investors. The Notes bear interest at 3.11 percent and mature on June 1, 2027. Interest on the Notes is payable semi-annually on June 1 and December 1 of each year, commencing on December 1, 2017. ALLETE has the option to prepay all or a portion of the Notes at its discretion, subject to a make-whole provision. The Notes are subject to additional terms and conditions which are customary for these types of transactions. Proceeds from the sale of the Notes may be used to redeem debt, fund corporate growth opportunities and for general corporate purposes. On August 25, 2017, ALLETE entered into a $40.0 million term loan agreement (Term Loan). The Term Loan is an unsecured, single draw loan that is due on August 25, 2020, and may be prepaid at any time subject to a make-whole provision. The interest rate on the Term Loan is equal to LIBOR plus 1.025 percent. Proceeds from the Term Loan will be used for general corporate purposes. Financial Covenants. Our long-term debt arrangements contain customary covenants. In addition, our lines of credit and letters of credit supporting certain long-term debt arrangements contain financial covenants. Our compliance with financial covenants is not dependent on debt ratings. The most restrictive financial covenant requires ALLETE to maintain a ratio of indebtedness to total capitalization (as the amounts are calculated in accordance with the respective long-term debt arrangements) of less than or equal to 0.65 to 1.00, measured quarterly. As of September 30, 2017, our ratio was approximately 0.42 to 1.00. Failure to meet this covenant would give rise to an event of default if not cured after notice from the lender, in which event ALLETE may need to pursue alternative sources of funding. Some of ALLETE’s debt arrangements contain “cross-default” provisions that would result in an event of default if there is a failure under other financing arrangements to meet payment terms or to observe other covenants that would result in an acceleration of payments due. As of September 30, 2017, ALLETE was in compliance with its financial covenants.

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- Definition The entire disclosure for information about short-term and long-term debt arrangements, which includes amounts of borrowings under each line of credit, note payable, commercial paper issue, bonds indenture, debenture issue, own-share lending arrangements and any other contractual agreement to repay funds, and about the underlying arrangements, rationale for a classification as long-term, including repayment terms, interest rates, collateral provided, restrictions on use of assets and activities, whether or not in compliance with debt covenants, and other matters important to users of the financial statements, such as the effects of refinancing and noncompliance with debt covenants. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Accounting Standards Codification -Topic 470 -URI http://asc.fasb.org/topic&trid=2208564 + Details
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