Comal School District leads pricing action; Oregon to sell $750 million TANs Tuesday

By Cristal Cody and Sheri Kasprzak

New York, June 23 - Light pricing activity on Monday was led by the Comal Independent School District of Texas, even as market insiders suggested new issue pricings may be tapering off somewhat.

"It has slowed down, even in the past week," one market source said. "Market conditions are pretty dismal right now, but I don't necessarily think there's a lack of interest in munis. These things come and go. I'm sure in the next few weeks, things will get better."

Moving back to the Comal ISD offering, the district lucked out better than it hoped with Monday's sale of $149.99 million building bonds, the district's financial adviser said.

The series 2008A bonds priced with a 4.99% true interest cost and 4% to 5.25% coupons to yield 3.49% to 5.07%, said Duane Westerman, managing director of Samco Capital Markets.

"Back in May, the muni market was stronger and we were looking at some better yields. The market's been just awful the last two weeks, so we ended up better than we were fearful we might be last week," he said.

"We're glad we got this deal done first thing in the morning."

The bonds (Aaa//AAA) have serial maturities from 2011 through 2029, a term due 2033, a serial maturity in 2034 and a term due 2038.

First Southwest Co. was the senior manager of the negotiated sale.

Proceeds will be used for school construction, renovation and equipment and land acquisitions.

Oregon Veterans prices $50 million

Also on Monday, the Oregon Department of Veterans Affairs priced $50 million general obligation bonds on Monday with a preliminary 1.06% initial yield, said Larry Groth, assistant director for the state's debt division.

The final terms are expected to be available after the bonds close on Tuesday.

J.P. Morgan Securities managed the negotiated sale.

Proceeds will be used for veterans' home loans.

Elsewhere, the Austin Independent School District in Texas had expected to price $100 million in series 2008 unlimited tax refunding bonds. Calls to the issuer were not returned for the terms of the sale.

The bonds (Aa1/AA+/AA) were sold on a competitive basis and are due from 2010 to 2033.

Proceeds will be used to construct new schools, renovate existing schools and acquire land for future schools.

Oregon to price $750 million

Moving to upcoming bond sales, the state of Oregon expects to price $750 million tax anticipation notes Tuesday, Groth said.

The series 2008A short-term notes have preliminary pricing talk set at a 3% coupon and a 1.72% yield or a couple basis points better, Groth said.

Bank of America is the senior manager of the negotiated sale.

Proceeds will be used for cash flow management.

Puerto Rico offerings

In other upcoming offerings, a couple of offerings out of Puerto Rico are expected in the next week.

The Puerto Rico Sales Tax Financing Corp. intends to price $737 million in series 2008A sales tax revenue bonds, said a sellside source familiar with the deal.

The bonds (A1//) will be sold on a competitive basis on Tuesday.

The proceeds will be used for the repayment of debt obligations owed to the corporation by the Commonwealth of Puerto Rico.

Elsewhere, the Puerto Rico Employees Retirement System plans to price $500 million in senior pension funding bonds (Baa3//). The bonds, according to Moody's Investors Service, will price on June 30, though that date could not be confirmed with the issuer by press time.

The bonds, which are due July 1, 2043, are expected to sell on a competitive basis.

Proceeds will be used to pay pension benefits and to reduce unfunded accrued actuarial pension liability.

Colorado's $350 million deal

Colorado expects to price $350 million general fund tax and revenue anticipation notes in a competitive sale on Thursday, according to preliminary official statement.

The series 2008A notes (/SP-1+/) are due June 26, 2009.

Piper Jaffray & Co. is the state's financial manager.

Proceeds will be used to fund anticipated cash flow shortfalls in the general fund for the fiscal year ending June 30, 2009.

Jewish Hospital bond sale

Later this week, the Jewish Hospital and St. Mary's Healthcare in Kentucky plans to price its previously announced $330 million sale of series 2008 revenue bonds, according to a calendar of upcoming deals.

The bonds (A3/A+/) will be sold on a negotiated basis with Morgan Stanley as the lead manager.

The offering will be sold through the Jefferson County Metro Government.

The bonds are due 2014 to 2020 with term bonds due 2023, 2028 and 2037.

Proceeds will be used to finance a power plant facility at Sts. Mary and Elizabeth Hospital, for renovations to other hospitals and to refund the system's series 2002 and 2004 revenue bonds.

Connecticut housing

The Connecticut Housing Finance Authority plans to price $260.27 million series 2008B mortgage finance program bonds, according to a preliminary official statement.

The $90 million subseries B1 fixed-rate bonds have maturities from 2017 to 2018 and terms in 2023, 2028 and 2034.

The $53.87 million subseries B2 fixed-rate bonds have serial maturities from 2009 through 2018 and terms in 2023 and 2028.

The $5 million subseries B3 fixed-rate bonds have serial maturities from 2009 through 2017.

The $111.4 million subseries B4 variable-rate bonds are due Nov. 15, 2038.

Citigroup Global Markets is the senior manager of the negotiated sale.

Proceeds will be used to refund outstanding bonds and to finance permanent home mortgage loans.

No additional information was available by press time Monday.

Klein IDS offering

Also ahead this week, the Klein Independent School District in Texas intends to price $191.1 million in schoolhouse and refunding revenue bonds, said a calendar of upcoming deals.

The bonds will be sold on a negotiated basis with First Southwest Co. as the lead manager.

Calls to the issuer for the pricing date were not immediately returned.

Proceeds from the sale will be used for the construction, renovation and acquisition of new classrooms, as well as for the refunding of outstanding bonds.

North Texas bond sale

Coming up this week, the North Texas Tollway Authority expects to price $124.62 million in series 2008G first-tier revenue refunding bonds on Wednesday, said a preliminary official statement.

The bonds (A2/A-/) will be sold on a negotiated basis with Citigroup Global Markets and Lehman Brothers as the lead managers.

The bonds are due Jan. 1, 2038.

Proceeds will be used to refunding the Dallas North Tollway System's series 2003B revenue refunding bonds.

Fort Smith sale ahead

Looking a little farther ahead, Fort Smith, Ark., expects to price $120.305 million water and sewer refunding and construction revenue bonds the week of June 30, a source said Monday.

The series 2008 bonds (/A/) have serial maturities from 2009 through 2023 and terms in 2028 and 2032.

The bonds are insured by Financial Security Assurance.

Stephens Inc. is the senior manager of the negotiated sale.

Proceeds will be used to refund the city's series 2002A bonds and to fund system improvements to the Mountainburg water treatment plant, neighborhood water lines and the Howard Hill elevated water storage tank.

Huntsville, Ala., notes

Also ahead, the Huntsville Health Care Authority in Alabama intends to price $150 million commercial paper notes on June 30, a source with the issuer said Monday.

The series 2008 notes (P-1//) will be sold in a negotiated sale managed by Merrill Lynch & Co.

The authority is a public corporation that owns and operates Huntsville Hospital.

Proceeds will be used to fund capital projects and to refund $65.7 million from the series 1997A bonds and $21.7 million from the series 2002A bonds.

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