EXHIBIT 99(c)

ITEM 3. LEGAL PROCEEDINGS.

     For a description of certain legal and regulatory proceedings
affecting the Company and its subsidiaries, see Notes 9 through 12 to
the Company's Consolidated and HL&P's Financial Statements in Item 8
of this Report, which notes are incorporated herein by reference.

     In August 1993, HL&P entered into a Consent Agreement with the
EPA that resolved three Administrative Orders issued by the EPA in
1991 and 1992 regarding alleged violations of certain provisions of
the Clean Water Act at Limestone during the period 1989 through 1992. 
Pursuant to the Consent Agreement, HL&P, while neither admitting nor
denying the allegations contained in the complaint, agreed to pay the
EPA $87,500.  On August 29, 1991, the EPA issued an Administrative
Order related to alleged noncompliance at W. A. Parish.  HL&P has
taken action to address the issues cited by the EPA and believes them
to be substantially resolved at this time.

     From time to time, HL&P sells equipment and material it no longer
requires for its business.  In the past, some purchasers may have
improperly handled the material, principally through improper disposal
of oils containing PCBs used in older transformers.  Claims have been
asserted against HL&P for clean-up of environmental contamination as
well as for personal injury and property damages resulting from the
purchasers' alleged improper activities.  Although HL&P has disputed
its responsibility for the actions of such purchasers, HL&P has, in
some cases, participated in or contributed to the remediation of those
sites.  Such undertakings in the past have not required material
expenditures by HL&P.  In 1990, HL&P, together with other companies,
participated in the clean-up of one such site.  Three suits have been
brought against HL&P and a number of other parties for personal injury
and property damages in connection with that site and its cleanup.  In
two of the cases, Dumes, et al. vs. Houston Lighting & Power Company,
et al., pending in the United States District Court for the Southern
District of Texas, Corpus Christi Division, and Trevino, et al. vs.
Houston Lighting & Power Company, et al., pending before the 117th
District Court of Nueces County, Texas, landowners near the site are
seeking damages primarily for lead contamination to their property.  A
third lawsuit, Holland vs. Central Power and Light Company, et al.,
involving an allegation of exposure to PCBs disposed of at the site,
was dismissed pursuant to a settlement agreement entered into by the
parties in July 1993.  The terms of the settlement were not material.  
In all these cases, HL&P has disputed its responsibility for the
actions of the disposal site operator and whether injuries or damages
occurred.  In addition, Gulf States has filed suit in the United
States District Court for the Southern District of Texas, Houston
Division, against HL&P and two other utilities concerning another site
in Houston, Texas, which allegedly has been contaminated by PCBs and
which Gulf States has undertaken to remediate pursuant to an EPA
order.  Gulf States seeks contribution from HL&P and the other
utilities for Gulf States' remediation costs.  HL&P does not currently
believe that it has any responsibility for that site, and HL&P has not
been determined by the EPA to be a responsible party for that site. 
Discovery is underway in all these pending cases and, although their
ultimate outcomes cannot be predicted at this time, HL&P and the
Company believe, based on information currently available, that none
of these cases will result in a material adverse effect on the
Company's or HL&P's financial condition or results of operations.

     For information with respect to the EPA's identification of HL&P
as a "potentially responsible party" for remediation of a CERCLA site
adjacent to one of HL&P's transmission lines in Harris County, see
"Liquidity and Capital Resources - HL&P - Environmental Expenditures"
in Item 7 of this Report, which information is incorporated herein by
reference.

     HL&P and the other owners of the South Texas Project have filed
suit against Westinghouse in the District Court for Matagorda County,
Texas (Cause No. 90-S-0684-C), alleging breach of warranty and
misrepresentation in connection with the steam generators supplied by
Westinghouse for the South Texas Project.  In recent years, other
utilities have encountered stress corrosion cracking in steam
generator tubes in Westinghouse units similar to those supplied for
the South Texas Project.  Failure of such tubes can result in a
reduction of plant efficiency, and, in some cases, utilities have
replaced their steam generators. During an inspection concluded in the
fall of 1993,  evidence was found of stress corrosion cracking
consistent with that encountered with Westinghouse steam generators at
other facilities, and a small number of tubes were found to require
plugging.  To date, stress corrosion cracking has not had a
significant impact on operation of either unit; however,  the owners
of the South Texas Project have approved remedial operating plans and
have undertaken expenditures to minimize and delay further corrosion. 
The litigation, which is in discovery, seeks appropriate damages and
other relief from Westinghouse and is currently scheduled for trial in
the fall of 1994.  No prediction can be made as to the ultimate
outcome of that litigation.