Kern County in California sells $180 million TRANs; new issues pile up for coming week

By Aaron Hochman-Zimmerman and Sheri Kasprzak

New York, July 9 - The municipals market saw some firming on Thursday with primary action still light.

Market conditions, however, did cause two issuers to pull offerings - both out of Sacramento.

The Sacramento Cogeneration Authority and Central Valley Financing Authority pulled $60 million and $50 million refunding bonds (A1/A+/A), according to Ron Jelicich, Sacramento Municipal Utility District assistant treasurer.

"Market interest rates rose, and so the refunding opportunity kind of went away," he said.

The issues are still authorized, but "we're not going to be pricing real soon," he said.

Merrill Lynch & Co. Inc. was scheduled to act as underwriter for both negotiated issues.

Proceeds would have been used to refinance outstanding debt.

In the broader market, amid light volumes "the market was firm," said one market insider, as investors watched the Treasury draw tepid demand for $11 billion in 30-year notes.

The next few weeks are not well mapped out, he said.

The market may tip in either direction.

"It'll be interesting," he added.

Kern notes price

Among the light primary action, the County of Kern in California sold $180 million in series 2009-10 tax and revenue anticipation notes, said a sellside source connected to the deal.

The notes (/SP-1+/) were sold on a competitive basis. Goldman, Sachs & Co. won the bid with a 0.52471% true interest cost. The notes, which are due June 30, 2010, have a 2.5% coupon, priced at par.

Proceeds will be used to fund seasonal cash flow requirements.

The county seat is Bakersfield, Calif.

SMMPA bonds trim 15 bps

Elsewhere, the Southern Minnesota Municipal Power Agency priced $76.7 million in series 2009A power supply system revenue bonds (A2/A+/) at a TIC of 4.892%, according to John Winter, the agency's director of finance and accounting.

The bonds were downsized from $95.6 after negotiations with the holder of series 2006 bonds determined that neither wanted to terminate an $18.9 million swap.

"We set it aside," Winter said.

The remaining amount will be used to refund $55 million of a commercial paper program used for many short-term expenses as well as $21.7 million to refund the series 1998A revenue bonds.

Still, the agency was happy with the results of the long-planned sale, Winter said.

"We did better than what we were thinking," he said.

"The market firmed up nicely," he said, especially in the tax-exempt space.

The agency took an advantage of 15 basis points over the expected TIC, he said.

The bonds carry serial maturities from 2010 to 2020 with term bonds due 2023 to 2024 and 2025 to 2030.

The bonds are callable in 2020.

Morgan Stanley & Co. Inc. acted as the lead underwriter for the negotiated deal. Public Financial Management Inc. acted as adviser to the deal.

The Southern Minnesota Municipal Power Agency is located in Rochester, Minn.

Iowa deal ahead

Looking to upcoming sales, the coming week's calendar is led by the State of Iowa's $602.375 million in series 2009 IJobs Program special obligation bonds Tuesday, according to a sales calendar.

The bonds (Aa3/AA/) will be sold through lead manager Barclays Capital Corp.

The sale includes $387.445 million in series 2009A tax-exempt bonds and $214.93 million in series 2009B Build America Bonds.

The 2009A bonds are due 2011 to 2029, and the 2009B bonds are due 2034.

The full details of the offering were not immediately available.

N.C. Turnpike deal ahead

Also ahead, the North Carolina Turnpike Authority plans to sell its previously announced $341.975 million in series 2009 Triangle Expressway System senior-lien revenue bonds (Aa2/AAA/AA) Tuesday, said a sales calendar.

The deal includes $29.475 million in series 2009A state annual appropriation revenue bonds and $312.5 million in series 2009B state annual appropriation revenue Build America Bonds.

Merrill Lynch and Banc of America Securities LLC are the lead managers.

The 2009A bonds are due 2019 to 2024 with term bonds due 2029 and 2039.

Proceeds will fund engineering costs, develop rights-of-way and roadways in the Triangle Expressway System and pay for maintenance costs.

Illinois electric sale

In other upcoming offerings, the Illinois Municipal Electric Agency is expected to sell $333 million in series 2009 power supply revenue bonds on Tuesday, according to a sales calendar.

The bonds (A1/A+/A+) will be sold through lead manager J.P. Morgan Securities Inc. The co-managers are BMO Capital Markets GKST Inc., Edward Jones, Morgan Stanley and Wachovia Bank NA.

The bonds are due 2013 to 2023.

Proceeds will be used to acquire an undivided interest in Prairie State, a coal-fired, steam-electric generating station.

Tiger bonds

The University of Missouri System plans to issue $350 million of series 2009A Build America Bonds and series 2009B tax-exempt bonds (Aa2/AA) Wednesday, according to a calendar of upcoming sales.

JPMorgan will act as underwriter for the negotiated deal.

The bonds will carry serial maturities from 2010 to 2039.

The University of Missouri System is based in Columbia.

Dasny's Yeshiva bonds

Also ahead, the Dormitory Authority of the State of New York plans to sell $145 million in series 2009 revenue bonds for Yeshiva University, said a preliminary official statement. Pricing is scheduled for Thursday.

The bonds (Aa3/AA/) will be sold through lead managers JPMorgan and Morgan Stanley.

The maturities have not been set.

Proceeds will be used to refund the university's series 1998 bonds.

The university is based in New York.

In other higher education bonds, the Georgia Higher Education Facilities Authority announced plans to sell a $105 million revenue bond (A2/A+/) Tuesday, according to a calendar of upcoming sales.

Citigroup Global Markets Inc. will act as underwriter for the negotiated deal.

A retail offer period will be held on Monday.

Louisiana hospital deal

In other upcoming deals, the Louisiana Public Facilities Authority is scheduled Monday to price its previously announced $150 million in series 2009A hospital revenue bonds for the Franciscan Missionaries of Our Lady Health System, said a calendar of upcoming sales.

The bonds (A2/A+/) will be sold through lead manager Merrill Lynch.

Proceeds will be used to finance refurbishment and equipment for Lady of Lourdes Regional Medical Center.

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