Pricing action booms as Lower Colorado River Authority sells $361.71 million

By Cristal Cody and Sheri Kasprzak

New York, May 13 - Pricing activity took off on Tuesday with several bonds pricing. The appetite for munis seems to be hearty, with several other offerings announced Tuesday.

"Investors are definitely eager for some bonds from reputable issuers with great credit," said one sellside source contacted Tuesday afternoon.

"Some issuers who don't have the best credit may be having some troubles still. I have seen a few here and there put their deals off, but most of the issuers we work with have no problems at all selling their stuff."

Asked about insured bonds, the sellsider said he doesn't even see the point now.

"Honestly, if you can, go without insurance," he said. "It's a waste of money, especially if you're a highly rated issuer. Chances are your rating is better than the insurer."

Lower Colorado River bonds price

Heading up the heavy day of activity was a $361.17 million offering of refunding revenue bonds from the Lower Colorado River Authority in Texas, a sellside source told Prospect News.

The $195.96 million series 2008 refunding revenue bonds (A1) priced with 5% to 5.75% coupons to yield 2.1% to 5.07%, he said.

The bonds have serial maturities from 2009 through 2018 and term bonds due in 2023, 2028 and 2037.

The authority also priced $165.205 million transmission contract refunding revenue bonds for the LCRA Transmission Services Corp., an affiliate of the authority.

The series 2008 bonds (A2/A/A+) priced with 5.25% to 5% coupons to yield 2.83% to 4.78%.

The bonds have serial maturities from 2009 through 2018 and term bonds due in 2023, 2028 and 2035.

The true interest costs were not available.

"The call date for the Transmission Services was a 10-year call, and the call on the LCRA was seven years," the sellside source said.

Morgan Stanley is the senior manager of the negotiated sales.

Proceeds will be used to refund $108.6 million contract revenue commercial paper notes, $50 million series B notes and a portion of the series A tax-exempt commercial paper notes.

Charlotte prices $184.035 million

In other pricing news Tuesday, the City of Charlotte in North Carolina priced $184.035 million in series 2008 general obligation refunding bonds, a source connected to the sale told Prospect News Tuesday.

The bonds (//AAA) were sold on a negotiated basis with Wachovia Bank as the senior manager.

The bonds are due from 2009 to 2023 with bifurcated serials due 2012, 2016 and 2018.

The coupons range from 3.5% to 5% and yields range from 2.05% to 4.11% for the serial bonds. The bifurcated serials have 5% coupons. The 2012 maturity has a 2.85% yield, the 2016 maturity has a 3.36% yield and the 2018 maturity has a 3.62% yield.

Proceeds from the sale will refund the city's series 1998 and 1999 G.O. bonds.

Roseville, Calif., sells COPs

Roseville, Calif., priced $154.5 million electric system revenue refunding certificates of participation with 1.6% initial rates on Tuesday, the issuer told Prospect News.

The $90 million series 2008A and $64.5 million series 2008B electric system revenue refunding certificates (A1/A+/A+) reset weekly, said Monty Hanks, investment analyst for the city.

The bonds mature Feb. 1, 2035.

"The information we got was there was a tremendous demand for the city's offering," Hanks said. "The transaction attracted a large number of money market fund buyers, including Van Guard, Schwab, Wells, Federated, Dreyfus and Fidelity. I heard that because tax season is done, there is a sufficient amount of excess cash out there."

Morgan Stanley is the manager of the negotiated sale.

Proceeds will be used to refinance and convert the series 2005B and C auction-rate electric system COPs to a variable rate and to pay costs to terminate the 2005 swap agreement.

Stamford, Conn., sells $88 million G.O.s

Stamford, Conn., priced $88 million G.O. bonds with a 3.82788% true interest cost, the issuer said Tuesday.

"Morgan Stanley was really low at 3.83%, Merrill Lynch came in at 3.85% and everybody else was in the 3.8% or above category. None of them were for 4.0% or greater," said Sandra Dennies, director of administration.

The series 2008A bonds (Aaa/AAA/) priced with 3.1% to 5% coupons that increase and decrease throughout the maturities from 2009 through 2028.

Citigroup Global Markets was the successful bidder out of 10 bidders in the competitive sale.

The city sold bonds last year through a live auction and chose to do a competitive parity sale this year in order to get the lowest and best offer, Dennies said.

"That is in fact what happened because I'm really happy with the spread," she said. "With the live auction, they can see what place their bid stands at so they can re-bid and change their standing. People knew [on the parity bids] they had one shot."

Aurora's $85.5 million G.O.s

Also on Tuesday, the City of Aurora in Illinois priced $85.5 million in series 2008 G.O. bonds Tuesday, said Brian Caputo, the city's treasurer.

The bonds priced with a TIC of 4.662971% with Piper Jaffray as the winning bidder of the competitive sale.

The bonds (/AA+/) are due 2009 to 2037 with a term bond due 2038. The serial bonds have coupons from 3.5% to 5%. The yields were not immediately available.

There were seven bidders in all, Caputo said.

Proceeds will be used to finance the acquisition and construction of a police station and related police facilities, emergency equipment and other capital improvements.

In other pricing news, Pima County, Ariz., priced $75 million in series 2008 sewer revenue bonds Tuesday, the issuer said, but the full terms were not immediately available.

The bonds were sold on a competitive basis with RBC Capital Markets as the financial adviser.

The bonds are due 2009 to 2011 and 2013 to 2023.

Proceeds will be used to expand the city's sewer facilities.

Brazos County, Texas prices with 4.37% TIC

Brazos County, Texas, priced $55 million limited tax bonds with a 4.37% TIC on Tuesday, the issuer's financial adviser told Prospect News.

The series 2008 bonds (-/AA/-) priced with 3.25% to 5% coupons to yield 2.4% to 4.71%, said Dennis Waley, senior managing consultant for Public Financial Management.

The bonds have serial maturities from 2010 through 2028.

Robert W. Baird & Co. was the successful bidder out of eight bidders in the competitive sale.

"These rates were very competitive. The low bid was 4.37% and the cover bid was 4.402%, so they were very close," he said.

Proceeds will be used to acquire land and to construct and equip a county jail.

Wyoming prices fixed-rate bonds

The Wyoming Community Development Authority priced $37 million housing revenue bonds at par on Tuesday, the issuer told Prospect News.

The $37 million series 2008-1 fixed-rate bonds have serial maturities from 2009 through 2017 and term bonds in 2023, 2028 and 2035.

The bonds (Aa1/AA+/) priced with 3.125% to 5.125% coupons for the serial maturities, said Scott Hoversland, director of finance.

The 2023 term bond priced with a 5.3% coupon, the 2028 term bond priced with a 5.45% coupon, and the 2035 term priced with a 5.6% coupon, he said.

"A week ago it probably would have been a lot higher," Hoversland said. "We had some money to recycle and we probably wouldn't have been able to do it under six and a quarter, so I think it went very well."

Merrill Lynch & Co. is the senior manager.

Proceeds will be used to provide funds to purchase single-family mortgage loans and to refund retiring bonds.

The authority also plans to price $13 million in series 2008-2 variable-rate bonds with an initial weekly interest rate on June 3, the date of closing. The bonds are due Dec. 1, 2038.

Depending on volume, the authority usually sells bonds every two to three months, Hoversland said.

Glendale to sell $84.28 million

Elsewhere, the city of Glendale, Ariz., had intended to price $84.28 million in senior-lien excise tax revenue bonds Tuesday, but the sale was pushed back to Thursday, said Ray Shuey with the city.

Banc of America Securities is the senior manager for the negotiated sale.

The bonds are due in a serial structure from July 1, 2009 to July 1, 2033.

The city plans to use the proceeds to refund its series 2006B subordinated-lien excise tax bonds.

Virginia College to price $143.645 million

Moving to upcoming bond sales, the Virginia College Building Authority will sell $143.645 million in series 2008A educational facilities revenue bonds May 20, said a preliminary official statement released Tuesday.

The bonds will be sold on a competitive basis and are due 2009 to 2028.

Proceeds from the sale will be used for capital projects and for the acquisition of equipment at colleges throughout Virginia.

Another competitive sale coming up on May 20 is an $80 million offering of G.O. bonds from the Metropolitan District of Hartford County, Conn., according to a preliminary official statement.

The series 2008 bonds have serial maturities from 2009 through 2028.

First Southwest Co. is the district's financial adviser.

Proceeds will be used to refund $63.825 million bond anticipation notes that mature on June 12, 2008 and to provide funds for sewer, water and public improvement projects.

Louisville bonds to price

Coming up, the Louisville & Jefferson County Metropolitan Sewer District in Kentucky intends to price $105 million sewer and drainage system revenue bonds in a competitive sale on May 21, according to a sale notice.

The series 2008A bonds (A2//) have serial maturities from 2010 through 2038.

The bonds are insured by Assured Guaranty.

First American Municipals Inc. is the district's financial adviser.

Proceeds will be used for sewer, water quality and drainage projects.

Hoag Memorial bonds

Looking a little farther ahead, the Hoag Memorial Hospital Presbyterian of California expects to price $452.08 million in series 2008 refunding revenue bonds later this month, a preliminary official statement said.

The sale includes $66.8 million in series 2008A bonds, $65.185 million in series 2008B bonds, $70.095 million in series 2008C bonds, $80 million in series 2008D bonds, $80 million in series 2008E bonds and $90 million in series 2008F bonds.

The bonds (Aa3/AA/) will be sold on a negotiated basis with Citigroup Global Markets as the senior manager.

The bonds are due Dec. 1, 2040.

The interest rate on the bonds will be reset on a weekly basis.

Proceeds will be used to refund the hospital's outstanding series 2005 and 2007 revenue bonds.

Chicago Transit bonds coming up

The Chicago Transit Authority is expected to price $1.79 billion sales and transfer tax receipts revenue bonds, possibly by June 24, according to a release from Moody's Investors Service.

The $1.213 billion series 2008A bonds and the $577.63 million series 2008B bonds (Aa3//) will be submitted for approval to the Illinois Auditor General on Wednesday. The approval process takes up to 60 days, and the authority has another 120 days to hold the sale.

Proceeds will be deposited into the authority's employee retirement plan and used to create a retiree health care trust.

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