Fairfax County prices $250 million GOs at 2.64% to 4.22%; Nassau County sells $125 million GOs

By Cristal Cody and Sheri Kasprzak

New York, Jan. 15 - Leading a very active day for new issuance of municipal bonds Tuesday was a $250.315 million issue of general obligation bonds from Virginia's Fairfax County.

The 2008A bonds priced in a serial structure from April 1, 2009 through April 1, 2028, said Tanya Burrell with the county's finance department.

The 2009 maturity's coupon came in at 4.50%, priced at 102.124% to yield 2.64%, Burrell said, and the 2028 maturity's coupon came at 4.125%, priced at 98.713% to yield 4.22%.

The coupons ranged from 4.125% to 5 %.

Burrell said that more than half of the proceeds - $144.28 million - will be used for school projects and the rest will be used for county projects.

"We're very excited," Burrell said. "We were able to get a great TIC [true interest cost], which we're super excited about."

Nassau County's $125 million issue

Another major offering to price Tuesday came from Nassau County in New York, which priced $125 million in general obligation bonds on a competitive basis.

The tax-exempt bonds (A2/A/A+) include $105 million in general improvement bonds, 2008 series A, and $20 million in sewer and storm water resources district bonds, series B.

The series A bonds will be used for improvement projects in the county, while the series B bonds will be used for sewer and water projects, said Edward Lin, senior managing consultant with Public Financial Management Inc. of New York, the county's financial advisor.

UBS Securities LLC submitted the winning offer out of six syndicates bidding on the bonds, Lin said.

The series A bonds have consecutive serial maturities from 2009 to 2028, and the series B bonds mature from 2009 to 2033.

The par amounts changed slightly, with the total still priced at $125 million and a true interest cost of 3.974%, Lin said.

The yields vary for each of the maturities.

The coupon for series A is 3.25% for the 2009 maturity with no yield offered, rising to a 3.5% coupon to yield 2.62% in 2010, and the 2028 maturity priced with a 4% coupon to yield 4.11%%.

The series B bonds priced with a coupon of 3.5% to yield 2.58% for the 2009 maturity, with the 2033 bonds priced with a coupon of 4.125% to yield 4.22%.

Tennessee Schools prices $118.53 million

Tennessee State School Bond Authority priced $118.53 million in bonds via a competitive sale Tuesday.

The series 2008A higher education facilities second program bonds (Aa2) came in with a true interest cost of 4.187%, Mary-Margaret Collier, director of bond finance for the state, told Prospect News Tuesday.

Morgan Keegan & Co. was the successful bidder out of 12 underwriters participating in the sale, Collier said.

The bonds were sold in a serial structure from May 2008 through May 2038.

The coupons ranged from 3.25% to yield 2.66% for the May 2008 maturity to a 5% coupon to yield 4.5% for the 2038 maturity.

Proceeds from the serial bonds sale will be used to retire at maturity the principal of commercial paper issued for projects at school and college campuses, finance a portion of various capital projects and satisfy the debt service reserve requirements.

California HFA bonds price

In other pricing news, the California Housing Finance Agency priced a portion of its planned $150 million offering of bonds Tuesday.

The agency priced $102 million in series 2008A bonds (Aa2/AA-) in a serial structure from February 2009 through February 2018.

The bonds priced in a range of coupons from 3.00% in the 2009 maturity to 4.35% for the 2018 maturity, according to a source close to the offering.

The insider noted that the bonds did price at par, as price talk suggested Monday.

The source also said that the series 2008B bonds were still being priced late Tuesday afternoon and the terms would likely be available on Wednesday. The 2008B term bonds have maturities in 2023, 2028 and 2041.

On Monday, price talk pegged the coupons in a range between 3.30% and 4.35%.

Goldman, Sachs & Co. was the lead manager for the offering

Chicago O'Hare prices $878 million

Elsewhere on Tuesday, Chicago O'Hare Airport priced $878 million in two bonds, according to Jeremy Fine with the City of Chicago's finance department.

On Tuesday afternoon, Fine said the city was still in the process of pricing the offering and he could not comment on the particulars of the bonds.

The airport brought $766 million in general airport lien bonds and $112 million in passenger facility charge bonds.

The general airport lien bonds were expected to price in a serial structure from 2010 through 2028 and in term bonds due 2033 and 2038, as well as AMT bonds with a serial structure from 2010 through 2018 and term bonds due 2022, 2028 and 2038.

The passenger facility charge bonds were expected to price in a serial structure from 2012 through 2016.

Texas bonds rated Aa1, set to price Jan. 23

Moody's Investors Service assigned a rating of Aa1 on Tuesday to $1.1 billion of Texas' general obligation mobility fund bonds issued by the Texas Transportation Commission. The rating outlook is stable.

The series 2008 tax-exempt bonds are expected to price Jan. 23, with UBS Investment Bank serving as the lead underwriter.

The bonds have serial maturities from 2009 to 2033. The tax-exempt bonds are being issued to help pay for transportation projects, including constructing and expanding state highways.

Revenue sources for the fund include motor vehicle inspection frees, driver's license fees and vehicle title fees, according to Moody's.

A representative of the commission's finance office was not immediately available for comment.

San Francisco bonds rated A by S&P

In other upcoming deals, Standard & Poor's gave an A rating to the San Francisco City and County Airport Commission's $169.5 million offering of 34A-C senior lien variable-rate revenue refunding bond, $255 million offering of 34D-E senior lien fixed-rate revenue refunding bonds and $110 million offering of 34F-G senior lien variable-rate revenue refunding bonds.

The timing of the bonds could not be determined by press time Tuesday.

According to an S&P statement, the 34A-C bonds will likely be insured and will receive a short-term rating based on bank liquidity, and will be hedged by an interest-rate swap. The F-G bonds will likely also be insured but will not be hedged by a swap, the S&P release said.

Washington Drama Society bonds confirmed

Also coming up is a $120 million offering of variable-rate demand revenue bonds from Washington, D.C.'s Washington Drama Society, Inc.

The bonds (Aaa) are set to price Jan. 23.

Shattuck Hammond Partners is the lead manager for the bonds, which are due 2047.

Proceeds from the bonds will be used to finance, refinance or reimburse the society for the construction, renovation and expansion of theater facilities and rehearsal spaces.

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