Municipal yields drop again; New Jersey sells $2.25 billion TRANs; Austin, Texas, plans sale

By Sheri Kasprzak

New York, Aug. 19 - Municipal yields closed lower yet again, said a trader.

"People are pumping tons of cash into munis," the trader said.

"We're almost in a free fall. I'm sure it will taper off, and probably before the end of the summer, but every day, we almost expect it."

Meanwhile, the volume of offerings shrank on Thursday, but investors got to feast on a $2.25 billion sale of series 2011A tax and revenue anticipation notes from the State of New Jersey.

The state sold the notes (MIG 1/SP-1+/F1+) competitively. J.P. Morgan Securities Inc. won the largest chunk of the sale - $2.05 billion. Citigroup Global Markets Inc. won a $100 million portion, and Goldman, Sachs & Co. took another $100 million part.

The 2% notes, which are due June 23, 2011, are priced at par.

Proceeds will be used to finance capital needs ahead of the collection of certain taxes and revenues.

Austin sale set

Looking to the coming week's new issues, a few major competitive offerings are slated.

One sellsider said that some issuers have a policy of going competitively with their deals, but others may just be trying to get the best possible pricing.

"It all depends upon the issuer," he said.

"Some find that going competitively will get them a better deal. Others will take it on a case-by-case basis."

Heading up the competitive sales is a $144.678 million offering of public improvement bonds and certificates from the City of Austin, Texas. That sale is slated to come to market on Thursday.

The offering includes $79.528 million in series 2010A public improvement bonds, $26.4 million in series 2010B taxable public improvement bonds, $22.3 million in series 2010 certificates of obligation and $16.45 million in series 2010 public property finance contractual obligations.

The bonds (Aaa/AAA/AAA) will be sold competitively with Public Financial Management Inc. as the financial adviser.

The 2010A bonds, 2010B bonds and 2010 COPs are due 2011 to 2030, and the series 2010 public property finance contractual obligations are due 2011 to 2017.

Proceeds will be used to finance a variety of capital improvement projects throughout the city.

New Hampshire deal ahead

Also going competitively, the State of New Hampshire will price $150 million in series 2010 general obligation capital improvement bonds on Wednesday, said a notice of sale.

The sale includes $90 million in series 2010B bonds and $60 million in series 2010C bonds.

The 2010B bonds are due 2012 to 2020, and the 2010B bonds are due 2021 to 2030.

The bonds (Aa1/AA/AA+) will be sold competitively with Public Resources Advisory Group as the financial adviser.

Proceeds will be used to finance capital improvements and to refund existing bond anticipation notes.

Richland schools to price

In other news, the School District No. 2 of Richland County in South Carolina is set to sell $136.585 million in series 2010 G.O. bonds on Tuesday, said a notice of sale.

The bonds (Aa2/AA/AA) will be sold competitively with Davenport & Co. LLC as the financial adviser.

The sale includes $93.96 million in series 2010C tax-exempt refunding bonds and $42.625 million in series 2010D Build America Bonds.

The 2010C bonds are due 2011 to 2024, and the 2010D bonds are due 2011 and 2027.

Proceeds will be used to fund improvements to the county's school facilities and to refund existing debt.

The district is based in Columbia, S.C.

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