Munis end slightly weaker; Illinois sells $3.47 billion G.O. bonds with 1.823%-4.421% coupons

By Sheri Kasprzak

New York, Jan. 7 - Municipal yields were up slightly on Thursday in another light day for secondary activity. Primary action, however, dominated the day's activity with billions in offerings priced. The State of Illinois led the offerings with a $3.466 billion sale of bonds.

"We might be off maybe a couple of basis points in spots," said one trader reached in the afternoon.

"Mostly unchanged across the yield curve, though. It really is dead [in secondary]. Primary is overloaded today, so everyone's focused there."

Meanwhile, Illinois priced $3.466 billion in series 2010 taxable general obligation bonds (A2/A+/A), said a pricing sheet.

The bonds are due 2011 to 2015 with coupons from 1.823% to 4.421%, all priced at par.

J.P. Morgan Securities Inc. was the senior manager.

Proceeds will be used to make contributions to the state's retirement fund as well as fund capital expenditures.

N.J. Transportation brings $858.7 million

Meanwhile, the New Jersey Transportation Trust Authority sold $858.7 million in series 2010 transportation system capital appreciation bonds, said a pricing sheet and a sellside source familiar with the deal.

The bonds (A1/AA/A+) were sold through Barclays Capital Inc.

The sale included $500 million in series 2010B Build America Bonds, which are due 2040 with a 6.561% coupon, priced at par. The offering also included $358.7 million in series 2010A capital appreciation bonds due 2025 through 2040 with coupons from 5.85% to 6.25%, all priced at par. The pricing sheet was not immediately available for the 2010A bonds.

Proceeds will be used to fund transportation infrastructure projects.

Florida DEP brings $251 million

Down South, Merrill Lynch & Co. brought to market $251 million in series 2010 Florida Forever bonds (A1/AA/A) for the Florida Department of Environmental Protection, said a pricing sheet.

The deal included $235 million in series 2010A Florida Forever bonds, $10 million in series 2010B Build America Bonds and $6 million in series 2010C tax-exempt bonds.

The 2010A bonds are due 2010 to 2017 with a term bond due 2025 with coupons from 2% to 5%. The 2010B bonds are due from 2018 to 2024 with a term bond due 2029. The serials have coupons from 5.306% to 6.406% coupons, all priced at par. The 2029 bonds have a 7.045% coupon, priced at par. The 2010C bonds are due 2010 to 2013 with 2% to 5% coupons.

Proceeds will be used to fund environmental protection projects throughout the state.

Maryland Economic Development bonds price

In other pricing action, the Maryland Economic Development Corp. sold $248.675 million in series 2010 economic development revenue bonds, said a term sheet.

The deal included $166.92 million in series 2010A bonds and $81.755 million in series 2010B bonds.

The 2010A bonds are due 2020, 2025 and 2035 with 5.125%, 5.375% and 5.75% coupons, respectively. The 2010B bonds are also due 2020, 2025 and 2035 with 5.125%, 5.375% and 5.75% coupons, respectively.

Goldman, Sachs & Co. was the senior manager.

Proceeds will be used to construct new cargo and machinery buildings as well as fund the acquisition and installation of four cranes at the Seagirt Terminal in Baltimore.

Chicago to bring $773 million

Looking to upcoming sales, the City of Chicago is expected to price its previously announced $773 million in series 2009 taxable project G.O. bonds during the week of Jan. 11, said a sales calendar.

The sale includes $420 million in series 2009A refunding bonds, $110 million in series 2009B refunding bonds, $110 million in series 2009C Build America Bonds and $133 million in series 2009D recovery zone economic development bonds.

The bonds will be sold through senior manager Siebert Brandford Shank & Co. LLC.

Proceeds will be used to finance public right-of-way infrastructure improvements, finance infrastructure improvements to encourage economic development, conduct transportation improvements and make grants to educational and non-profit organizations as well as refund existing debt.

Miami-Dade to price $600 million

Also in the coming week, Miami-Dade County of Florida is scheduled to bring $600 million in series 2010A aviation revenue bonds Wednesday, according to a sales calendar.

The bonds will be sold on a negotiated basis with Citigroup Global Markets Inc. as the senior manager.

Proceeds will be used to reimburse the county for port improvements, retire commercial paper and make a deposit to a debt reserve fund.

Additionally, the Indiana Finance Authority is expected to price $359.09 million in series 2010A state revolving fund program refunding bonds, said a preliminary official statement. The sale is expected for the week of Jan. 11.

The bonds (Aaa/AAA/AAA) will be sold through lead managers Bank of America Merrill Lynch and Citigroup.

The bonds are due 2011 to 2024.

Proceeds will be used to refund existing debt.

Ohio State bonds planned

Coming up on Wednesday, the Ohio State University is expected to price $278.095 million in series 2010A general receipt bonds, said a preliminary official statement. The sale is expected for Wednesday, said a sales calendar.

The bonds (Aa2/AA/) will be sold on a negotiated basis with Morgan Stanley & Co. Inc. as the lead manager.

The bonds are due 2010 to 2020.

Proceeds will be used to refund existing bonds.

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