Moody's assigns Aa3 to Bay Area Toll bonds

Moody's Investors Service said it assigned an Aa3 rating to the Bay Area Toll Authority, Calif.'s $715 million 2008 series F-1 bonds.

The expected sale date is Aug. 8.

Proceeds will be used to refund all $507 million of outstanding Ambac-insured auction-rate securities and $150 million in Ambac-insured floaters with uninsured fixed-rate bonds. The authority will retain $550 million in underlying swaps, but will layer on synthetic floating swaps for two to three years. Refunded bonds include the 2003 series A and B, 2006 series D-2 and E-1 and 2007 series D-1, E-1 and E-2 bonds.

Moody's affirmed the underlying Aa3 rating on the authority's outstanding parity bonds. The outlook is stable.

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