Municipal trading 'selective'; Ohio brings $60 million; Maryland, Utah coming soon

By Cristal Cody and Aaron Hochman-Zimmerman

New York, Feb. 24 - The municipal marketplace improved its tone and general demeanor as stocks recovered on Tuesday, but volumes were still too light to draw any definitive conclusions.

We saw "spotty business" on Tuesday, a trader said.

The long end remained the product of choice as bonds due in "2021 on out saw a fair amount of business," he said.

"The municipal supply isn't overwhelming so it's not knocking the market down," he said, but "bonds behind 5% are hard to come by" and "the intermediate part of the curve continues to be a little heavy."

The new bonds from Boulder Valley School District No. RE-2 and the city and county of Broomfield in Colorado were the closest thing to being "really indicative of where the market is," he said.

Onondaga rolls out $61.725 million

Onondaga County in New York priced $61.725 million series 2009A general obligation bonds (Aa2/AA+/AA+), according to county financial analyst Joan Ferrara.

Wachovia won the auction with a true interest cost of 3.56%.

"We were happy with it," Ferrara said, adding that some on the financial advisory team hoped for 3.8%.

Fiscal Advisors and Marketing Inc. and Government Finance Associates Inc. acted as financial advisers for the bonds due from 2011 to 2029.

The bonds due 2020, 2021, 2022 and 2024 are callable on March 1, 2019.

Proceeds from the sale will be used to renovate courthouses, construct zoos and hotels, purchase radios and radio infrastructure and build parks.

The Onondaga County seat is located in Syracuse.

Way to go Ohio

The State of Ohio priced $60 million series 2009A Third Frontier research and development G.O. bonds (Aa1/AA+/AA+), according to Larry Schlopak of the debt management office.

Terms were not immediately available, but "it went well," Schlopak said.

Still, "we experienced higher spreads to the MMD than we historically do," he said.

The bonds came "more in the 45 to 50 basis point range," whereas the state is used to spreads close to 10 to 15 bps over MMD, he said.

PNC Capital Markets LLC acted as lead manager for the negotiated bonds, which carry serial maturities from 2010 to 2018.

Proceeds from the sale will be used to pay for authorized research and development projects.

Maryland to sell $515 million G.O.s

The states of Maryland and Utah plan to hold large sales in early March.

The State of Maryland intends to sell up to $515 million in G.O. bonds (Aaa/AAA/AAA), the issuer told Prospect News on Tuesday.

Maryland plans to sell at least $325 million in first series 2009A and $85.5 million in first series 2009B refunding bonds through a retail order period on Friday, Monday and Tuesday.

Any unsold bonds will be sold through a competitive sale along with $100 million in first series 2009C state and local facilities loan bonds on March 4, said Patti Konrad, director of debt management.

"The competitive sale is a minimum of $100 million. The total will not exceed $515 million," she said.

According to state laws, Maryland may sell bonds only through retail order periods or competitive sales, Konrad said.

The series 2009A and 2009C bonds have serial maturities from 2012 through 2024.

The series 2009B bonds have serial maturities from 2010 through 2012.

Public Financial Management is the state's financial adviser.

Merrill Lynch & Co. is the senior manager of the retail order period.

The proceeds will be used to acquire and construct state facilities and for capital grants to local governments for public schools, community colleges, jails and correctional facilities and other health-care and cultural projects. Proceeds also will be used to refund outstanding debt.

Utah to sell $430 million G.O.s

The State of Utah intends to sell $430 million in G.O. bonds on March 3, a source with the issuer told Prospect News.

The series 2009A bonds have serial maturities from 2009 through 2023.

Morgan Stanley & Co. is the senior manager of the negotiated sale.

The proceeds will be used to pay for highway construction or reconstruction projects.

Virginia Public School Authority plans $287.57 million

Also ahead, the Virginia Public School Authority expects to price $287.57 million in refunding bonds through an upcoming sale, the issuer told Prospect News on Tuesday.

The series 2009A school financing refunding bonds (Aa1/AA+/AA+) may price on Thursday at the earliest, said Rick Davis, public finance manager for the Virginia Department of the Treasury.

"We're working day to day now," he said. "It's very tentative."

The bonds have serial maturities from 2010 through 2021.

Morgan Keegan & Co., Inc. is the senior manager of the negotiated sale.

The proceeds will be used to refund outstanding debt from the series 1997I, 1998A, 1999A, 2000B, 2001A, 2001B, 2001C, 2002A and 2002B bonds.

Cuyahoga Community College to price $125 million

The Cuyahoga Community College District, which is based in Cleveland, plans to price $125 million in general receipts bonds, according to a preliminary official statement released Tuesday.

The series 2009C bonds (Aa3/AA-/) have serial maturities from Aug. 1, 2009 through Aug. 1, 2029.

KeyBanc Capital Markets Inc. is the senior manager of the negotiated sale.

The proceeds will be used to construct, equip, renovate and furnish college facilities and to retire the series 2009B notes.

Vandy nets $250 million at Treasuries plus 250 bps

Vanderbilt University in Nashville priced $250 million taxable notes in line with talk at a spread of Treasuries plus 250 bps, the issuer told Prospect News.

The series 2009A notes (Aa2/AA/AA) priced with a 5.25% coupon to yield 5.273%, said Betty Price, interim vice chancellor for finance and chief financial officer for the university.

The notes are due in 2019.

Morgan Stanley was the senior manager of the negotiated sale.

The proceeds will be used for working capital and cash management needs, as collateral to secure the university's obligations under hedge agreements and to terminate hedge agreements, to provide liquidity to support debt obligations and to acquire and construct improvements for university facilities.

In other sales, the Boulder Valley School District No. RE-2 and the city and county of Broomfield, Colo., were expected to price $176.8 million in G.O. bonds through a competitive sale on Tuesday.

Details were not immediately available.

The series 2009 bonds have serial maturities from 2010 through 2034.

Public Finance Associates LLC is the financial adviser.

Also expected to price on Tuesday were $75 million in unlimited tax school building bonds from the Northside Independent School District of San Antonio.

Calls for additional information were not immediately returned.

The series 2009 bonds have serial maturities from 2012 through 2039, according to a preliminary official statement.

Frost Bank was the senior manager of the negotiated sale.

The proceeds will be used to acquire, construct, renovate and equip school facilities and school property.

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