Dallas Area Rapid Transit's $736.495 million sale 'on market'; California details $1.5 billion G.O. sale

By Cristal Cody and Sheri Kasprzak

New York, June 13 - Light pricing news Friday was led by the Dallas Area Rapid Transit, which priced $739.495 million in series 2008 senior-lien sales tax revenue bonds on Thursday, the issuer said.

The bonds (Aa3/AAA/AA-) were priced with a 4.96% true interest cost, said Nate Hallett, DART's interim chief financial officer, in an interview with Prospect News.

The arbitrage yield for the bonds was 4.73%, he said. The coupons and yields were not immediately available, he noted.

The bonds were sold on a negotiated basis with Merrill Lynch as the senior manager and are due 2009 to 2028 with term bonds due 2033, 2038, 2043 and 2048.

Bonds 'right on market'

"We were right on market," Hallett said when asked how he feels the sale went given current market conditions.

"You always want rates to be lower," Sharon Leary, DART's current CFO, said in the interview.

"We have a 20-year financial plan and we basically came within those numbers. It's not costing us any more than we thought it would. Right now, we're working on our Green Line, which is a lightrail project that goes from the northern suburbs to downtown Dallas. Most of the money is for that project. It is the longest lightrail project under construction in the U.S. We're also setting aside money for keeping up the current system. There are some funds for HOV projects, purchasing real estate for the Orange Line, which goes out to Irving."

Proceeds will be used to construct, repair, acquire and expand the public transportation system, especially the system's Green Line lightrail system.

California $1.5 billion

In other news Friday, California released additional details of the planned sale of $1.5 billion general obligation bonds.

The bonds (A1/A+/A+) will price on June 24.

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

Proceeds will be used to finance projects, including for seismic safety, clean water and education; to refund outstanding commercial paper notes; and to repay internal state loans.

Idaho's $600 million sale

Heading up offerings for the week of June 16, the state of Idaho intends to sell $600 million in series 2008 tax anticipation notes on Wednesday, said a source close to the sale.

The notes (MGI1//F-1+) will be sold on a negotiated basis with Banc of America Securities as the senior manager.

The notes are due June 30, 2009, and proceeds will be deposited into the state's general fund.

Indiana Bond Bank's funding notes

The Indiana Bond Bank expects to price $437 million mid-year funding program notes on Thursday, a source told Prospect News.

The series 2008A notes mature May 28, 2009.

Pre-pricing will be held for the notes on Wednesday.

J.P. Morgan Securities is the senior manager of the negotiated sale.

Proceeds will be used to purchase tax anticipation obligations of state school corporations, counties, cities, libraries and other entities.

Oregon Facilities' $344.67 million deal

Looking ahead to upcoming sales, the Oregon Facilities Authority plans to price $344.67 million in series 2008 conduit variable-rate revenue bonds on June 25, said a calendar of upcoming sales.

The sale includes $95.495 million in series 2008A bonds, $99.175 million in series 2008B bonds, $80 million in series 2008C bonds and $70 million in series 2008D bonds.

The bonds will be sold on a negotiated basis with Goldman, Sachs & Co. as the senior manager.

The 2008A bonds are due 2034, the 2008B bonds are due 2034, the 2008C bonds are due 2047 and the 2008D bonds are due 2047.

Proceeds from the sale will be loaned to PeaceHealth Corp. to refund some of the organization's outstanding bonds.

Washington Health Care bonds

Similarly, the Washington Health Care Facilities Authority will price $167.515 million in series 2008 revenue bonds, also for PeaceHealth, said a preliminary official statement.

The bonds (/AA-/AA) will be sold on a negotiated basis with Goldman, Sachs & Co. and Wells Fargo Brokerage Service as the senior managers.

The sale includes $80.815 million in series 2008A revenue bonds, which are expected to price the week of June 16, said a sellside source.

The offering also includes $86.7 million in series 2008B, 2008C and 2008D variable-rate demand revenue bonds. Those bonds are expected to price the week of June 23.

Proceeds will be loaned to PeaceHealth to refund the corporation's series 2001A and series 2001B revenue bonds.

St. Joseph bond sale

St. Joseph Health System in California intends to price $137 million variable-rate refunding revenue bonds on Wednesday, a sellside source told Prospect News.

The series 2008B bonds (Aa3//) will price through the Lubbock Health Facilities Development Corp.

Morgan Stanley will manage the negotiated sale.

Proceeds will be used to refund the outstanding series 1998 fixed-rate revenue bonds.

Also, the Eastern Municipal Water District in California intends to price its previously announced $54.62 million water and sewer revenue refunding certificates of participation on Tuesday, said Chuck Rathbone, chief financial officer.

The series 2008C weekly variable-rate COPs (Aa3/AA/AA) are due July 1, 2020.

"We have a variable swap fixed with AIG and the insurance is with FIGIC, so we're stripping out the insurance and refunding and we will retain the swap," he said.

Citigroup Global Markets will manage the negotiated sale.

Proceeds will be used to refund the series 1993B COPs.

Pennsylvania IDA sale

In other upcoming offerings, the Pennsylvania Industrial Development Authority plans to price its previously announced $141.595 million in series 2008 economic development revenue refunding bonds on Thursday, said a calendar of upcoming offerings.

The bonds (A3/A-/A) will be sold on a negotiated basis with Citigroup Global Markets as the lead manager.

Proceeds from the sale will be used to refund the authority's series 1994, 1996 and 2002 bonds, as well as to fund $4.4 million in new loan capacity. The rest will be used to pay an $8.1 million swap termination fee for the series 2004 bonds.

Lewis & Clark bonds

Also coming up this week, Lewis & Clark College in Oregon plans to price $106.4 million in series 2008A revenue bonds on Tuesday through the Oregon Facilities Authority, said a calendar of offerings released by the issuer.

The bonds (Aaa/VMIG1//) will be sold through lead manager Prager Sealy & Co.

The variable-rate bonds are due Oct. 1, 2032. The bonds initially bear interest at the weekly rate, but may be converted to a fixed-rate mode.

Proceeds will be used for capital improvements on campus.

New Jersey sale

The New Jersey Educational Facilities Authority plans to price $89.235 million revenue bonds during the week of June 16, a source with the authority said.

The series 2008C bonds (Aaa/AAA/) will price for the William Paterson University of New Jersey.

"It's next week, but we're leaving it open as to the exact day," the source said Friday.

The bonds have serial maturities from 2009 through 2026 and term bonds in 2030, 2033 and 2038.

The bonds are insured by Assured Guaranty Corp.

RBC Capital Markets is the senior manager of the negotiated sale.

Proceeds will be used to finance a three-story science hall addition for research space, classrooms and teaching labs and to refund the outstanding series 1998D revenue bonds.

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