Municipals lose steam as week closes; DART plans $829 million; New Jersey to price G.O. bonds

By Sheri Kasprzak

New York, Sept. 24 - Municipal yields gave back some of the week's earlier gains on Friday, ending a streak of firmness, said traders reached in the afternoon. Meanwhile, the primary market was gearing up for another week jam-packed with new deals.

"Yields are down 1 to 2 basis points across the curve," said a trader. "We're just giving back some of the gains we had earlier in the week."

Another trader noted that it was another quiet session for the secondary market.

"Very little [is] going on," he noted. "Yields are probably up 1 to maybe 3 [bps] in places."

Heading up a heavy calendar of upcoming sales for the week ahead is an $829 million sale of series 2010 senior-lien sales tax revenue bonds from Dallas Area Rapid Transit. The sale is scheduled for Tuesday.

The bonds (Aa2/AA+/) will be sold on a negotiated basis with Bank of America Merrill Lynch as the senior manager.

Proceeds will be used to finance improvements to commuter projects and other infrastructure projects in the city.

N.J. preps G.O. bonds

In the Northeast, the State of New Jersey is set to come to market Thursday with $664.585 million in series Q-S general obligation bonds (Aa2//AA) through senior manager Morgan Stanley & Co. Inc.

The offering includes $490.01 million in series Q bonds, $92.71 million in series R federally taxable bonds and $81.865 million in series S bonds.

The series Q bonds are due 2013 to 2021, and the series R bonds are due 2014 to 2015. The series S bonds are due 2013 and 2016 to 2017.

Proceeds will be used to refund various existing G.O. bonds.

JEA plans sale

Also ahead during the week, Florida's JEA plans to bring its previously announced $321.76 million in series 2010 electric system revenue bonds in two offerings on Tuesday and Thursday, said a sales calendar.

The deal includes $217.035 million in series three 2010D revenue bonds and $10.7 million in series 2010C subordinated revenue bonds, which will price Tuesday, and $34.315 million in series three 2010E Build America Bonds, $52.435 million in series 2010D subordinated revenue bonds and $7.275 million in series 2010E subordinated revenue bonds, which will price Thursday.

Citigroup Global Markets Inc. is the senior bookrunning manager for the series three 2010D bonds and the 2010C subordinated bonds. Goldman, Sachs & Co. is the senior bookrunning manager for the series three 2010E bonds, the 2010D subordinated bonds and the 2010E subordinated bonds.

The series three 2010D bonds are due 2011 to 2031 with term bonds due 2035 and 2037. The series three 2010E bonds are due 2028 to 2040. The 2010C subordinated bonds are due 2020 to 2027, and the 2010D subordinated bonds are due 2016 to 2027. The 2010E subordinated bonds are due 2012 to 2015.

Proceeds will be used to fund the construction, extension and expansion of JEA's electric system and refund on Oct. 22 the authority's series three 2008D-2A, series three 2008D-2B and series three 2008D-2 variable-rate bonds.

Jacksonville Electric Authority is a water and electric system in Jacksonville, Fla.

Pennsylvania school deal ahead

Coming to market on Thursday is the Commonwealth of Pennsylvania Public School Building Authority's sale of $325.526 million in series 2010A federally taxable qualified school construction revenue bonds (Aa2//AA), according to a sales calendar.

The bonds will be sold through Citigroup and Morgan Stanley.

The bonds are due Sept. 15, 2027.

Proceeds will be used to fund new school construction within the state.

NYC G.O. deal planned

Looking ahead, the City of New York is expected to bring to market $1.3 billion in series 2011 G.O. bonds, said a preliminary official statement.

The offering includes $650 million in series 2011C-1 Build America Bonds, $150 million in series 2011C-2 taxable bonds, $30 million in series 2011D tax-exempt bonds and $470 million in series 2011E tax-exempt bonds.

The bonds are expected to price Oct. 7.

The 2011C-1, 2011D and 2011E bonds will be sold on a negotiated basis with Bank of America Merrill Lynch as the senior manager.

The 2011C-2 bonds will be priced competitively with Public Resources Advisory Group as the financial adviser.

The 2011C bonds are due 2012 to 2026. The 2011D bonds are due 2011 to 2029, and the 2011E bonds are due 2012 to 2030.

Proceeds will be used for capital purposes.

Illinois authority to sell bonds

Also coming up, the Metropolitan Pier and Exposition Authority of Illinois is gearing up to bring $1.178 billion in series 2010 McCormick Place Expansion Project bonds, said a preliminary official statement.

The offering is comprised of $204.37 million in series 2010A bonds, $940.6 million in series 2010B refunding bonds and $33.22 million in series 2010C refunding bonds.

The 2010A bonds include capital appreciation bonds, current interest bonds and deferred interest bonds. The current interest bonds are due June 15, 2050, and the capital appreciation bonds are due 2027 and 2043 to 2046. The maturities for the deferred interest bonds have not been set.

The 2010B bonds are due June 15, 2050, and the 2010C bonds are due June 15, 2027.

Morgan Stanley and Goldman Sachs are the joint bookrunning senior managers. The co-senior managers are Cabrera Capital Markets LLC and Loop Capital Markets LLC.

Proceeds will be used to renovate and expand the Hyatt Regency McCormick Place Hotel by constructing a 450-room tower over the building's existing parking structure, as well as to refund existing debt.

The authority, based in Chicago, promotes, operates and maintains fairs, expositions, conferences and meetings within Cook County.

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