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                                                      Exhibit 10.1







April 26, 2005



Marian Durkin

Re:   Amended Offer Letter of Employment

Dear Marian:

      This letter will confirm our recent discussions leading to this offer to
you for the position of Senior Vice President and General Counsel of Avista
Corporation. We have agreed that your effective starting date will be a mutually
agreeable date that begins prior to August 1, 2005. Your annual salary in your
position as Senior Vice President and General Counsel will be $260,000, paid in
26 biweekly increments in accordance with Avista Corporation's normal payroll
procedures. You will be eligible to participate in Avista Corporation's
Executive annual incentive plan. For year 2005, the incentive bonus potential
for your position as Senior Vice President is 60% of base salary and would be
pro-rated based upon your effective start date. Actual incentive bonus payout
for officers is determined based on successfully reaching the objectives
identified in each annual plan. You will also be eligible to participate in
Avista Corporation's Executive Performance Share Plan. As a Senior Vice
President you will be awarded an annual grant of 15,500 performance shares, with
a potential payout of 0% - 150% of each grant based on a 3-year performance
cycle. You will also be provided with a Change in Control Contract upon your
hire date that provides you with benefit protection as outlined in the contract
in the event of a change in control.

      As an Avista Corporation employee, you and your eligible family members
will be entitled to participate in the normal benefits package offered to all
employees, including medical, vision, and dental coverage. You will also be
eligible to participate in the 401(k) plan on the enrollment date that coincides
with or immediately follows your employment date (20th of each month, effective
the first pay close in the following month).

      As an executive of the Company, you will be enrolled in the Executive
Income Continuation Plan and the Supplemental Executive Long Term Disability
Plan upon completion of your signature for these plans. You will also be
eligible to participate in the Supplemental


                                   Page 1 of 4

Executive Retirement Plan, according to the eligibility set forth in the Plan
document with the addition of the following provision.

      After completing five years of full-time employment service you will
receive a "two for one" credit for Vesting Service for each completed year of
full-time service from year six through year ten (employment service). Your
five-year employment anniversary triggers commencement of the additional Vesting
Service credit. There is no "two for one" credit prior to completion of your
fifth year of employment or after completion of your tenth year of employment.
For illustrative purposes, if you terminated your employment at your seventh
employment anniversary you would have a total of nine years Vesting Service
credit in the Supplemental Executive Retirement Plan. As an additional
illustration, if instead you terminated your employment at your eleventh
employment anniversary you would have a total of sixteen years Vesting Service
credit in the Supplemental Executive Retirement Plan.



          EMPLOYMENT SERVICE                VESTING SERVICE
          ------------------                ---------------
                                         
                5 years                          5 years
                5-1/2 years                      6 years
                6 years                          7 years
                7 years                          9 years
               10 years                         15 years
               11 years                         16 years


      The Retirement Plan for Employees of Avista Corporation will be utilized
in determining the benefit payable from the Supplemental Executive Retirement
Plan.

      To assist with your move to Spokane, Avista will provide you with a
relocation coordinator and cover the applicable reimbursable amounts of the
actual costs of your relocation up to $35,000. The relocation coordinator would
assist you in understanding what costs are covered under the relocation
guidelines. The Company will pay for reasonable expenses for two round trips for
you between Chicago and Spokane, including airfare, lodging, and meals in
connection with house-hunting trips of up to seven days in duration for you and
your spouse. The Company will also pay for reasonable temporary living expenses
for a period of up to 90 days for food, lodging, and rental car, if necessary,
upon arrival in Spokane.

      You will receive an initial bank of 15 one-leave days immediately upon
employment, which can be used in accordance with Avista Corporation policy
guidelines. Commencing on your employment date, your one leave will be
accumulated on an accrual basis each pay period based upon years of service
according to the plan provisions.

      Please note that your acceptance of this offer does not create a contract
of continuing employment at Avista Corporation. Your employment with Avista
Corporation is and will continue to be on an at-will basis; either you or Avista
Corporation may terminate the employment relationship at any time, for any
reason not expressly prohibited by law.


                                   Page 2 of 4

      Notwithstanding the foregoing, in the event that, at any time prior to
your completing two years of full-time employment with Avista Corporation, the
Company chooses to relieve you from your position, other than for Cause, as
defined below, or an actual Change in Control event, you will be entitled to
receive the severance benefits described in the next paragraph. This entitlement
will cease completely at your second year employment anniversary date. In the
event of a Change in Control, your Change of Control contract takes precedent
and this severance benefit is not payable.

      On any termination of your employment by Avista entitling you to severance
benefits, you would be entitled to receive severance payments (less applicable
withholding taxes) at a rate equal to your current base salary as then in
effect, for a period of one year from the date of such termination, to be paid
periodically in accordance with Avista Corporation's normal payroll policies.
The company will also continue to provide you with regular company medical
health benefits for the period of the first three months following termination.
After this period of time you could choose to elect to participate in COBRA
coverage at which time you would be responsible for paying the full monthly
premium associated with the coverage you elected.

         For purposes of this offer letter, Cause shall mean (i) any act of
personal dishonesty taken by you in connection with your responsibilities as an
employee which is intended to result in your personal enrichment, (ii) your
conviction of a felony, (iii) any act or omission by you that constitutes
material misconduct and is injurious to Avista Corporation, (iv) failure to
obtain or maintain the requisite licenses and status necessary to perform in
your position, or (v) continued violations by you of your obligations to Avista
Corporation.

      This offer is contingent upon the company completing reference checks as
supplied by you and you successfully passing our pre-employment drug testing. As
a condition of employment, you will be required to sign a Confidentiality,
Non-Solicitation, Invention and Non-Compete Agreement. This letter and the
Confidentiality, Non-Solicitation, Invention and Non-Compete Agreement set forth
the terms of your employment with Avista Corporation and supersede any prior
representations or agreements of the company, whether written or oral. This
letter may not be modified or amended except by a written agreement signed by
the CEO and Chairman of Avista Corporation and you.

      In the event of any dispute or claim relating to or arising out of our
employment relationship, you and Avista Corporation agree that (i) any and all
such disputes will be fully and finally resolved by binding arbitration
conducted by the American Arbitration Association in Spokane County, Washington,
(ii) you are waiving any and all rights to a jury trial, but all court remedies
will be available in arbitration, (iii) all disputes will be resolved by a
neutral arbitrator who will issue a written opinion, (iv) the arbitration will
provide for adequate discovery, and (v) each of you and Avista Corporation will
pay one half of the costs and expenses of such arbitration and each of you and
Avista Corporation will separately pay your respective counsel fees and
expenses. However, we agree that this arbitration provision will not apply to
any disputes or claims relating to or arising out of the misuse or
misappropriation of Avista Corporation's proprietary information. Therefore,
Avista Corporation reserves the right to seek injunctive relief in court should
it become necessary.


                                   Page 3 of 4

       I am looking forward to you joining Avista Corporation, and I have full
confidence that your background and experience will assist you in making a
significant contribution to the legal and strategic direction of our Company. If
you are in agreement with the general terms outlined in this letter, I ask that
you sign and return the original letter to me as soon as possible.

Sincerely,

/s/ Gary G. Ely

Gary G. Ely
CEO and Chairman of the Board of Directors
Avista Corporation

Accepted by: /s/ Marian M. Durkin
             --------------------------------
             Marian M. Durkin

Dated:    5/5/05
       ----------------------------


                                   Page 4 of 4

		Exhibit 99.1

Contact:
Debbie Simock – (509) 495-4174 debbie.simock@avistacorp.com
Jason Lang – (509) 495-2930 jason.lang@avistacorp.com
Avista 24/7 Media Access (509) 495-4174

Avista Corp. Names Marian Durkin Senior Vice President and General Counsel

Durkin will join Avista on Aug. 1

SPOKANE, Wash. – June 21, 2005, 5:30 a.m. PDT: Avista Corp. (NYSE: AVA) has named Marian Durkin as senior vice president and general counsel, effective Aug. 1.

Durkin, 51, joins Avista from United Air Lines, Inc., in Chicago, Ill., where she most recently served as vice president deputy general counsel and assistant secretary.

Durkin will be the chief legal officer for Avista Corp. and will provide legal counsel and guidance to the Board of Directors and officers on legal matters relevant to the company and its subsidiaries.

“Marian promises to be an outstanding addition to our leadership team. She brings an impressive background and a wealth of experience to this position. Marian is well respected for her expertise and strategic capability in the areas of negotiations, labor management, litigation, corporate governance, and merger and acquisitions. Her capabilities will provide tremendous value to our company in the years to come,” said Gary G. Ely, board chairman, president and chief executive officer for Avista Corp.

“I’m looking forward to this new opportunity with Avista, and I’m pleased to be joining such a well-respected company with a well-earned reputation for creativity and innovation,” Durkin said.

Prior to joining United where she held several legal positions during her 10 years with the company, Durkin was a partner in the Minneapolis, Minn., law firm of Briggs and Morgan, P.A.

Durkin, a native of Narbeth, Penn., earned both a law degree and a master’s of law degree in taxation from William Mitchell College of Law in Saint Paul, Minn. She earned a bachelor’s degree in political science from Manhattanville College in Purchase, N.Y.

Durkin is active in a number of community organizations and is a frequent lecturer at legal conferences. She has also served as an adjunct professor at William Mitchell College of Law and is a member of both the Minnesota and Illinois Bars.