Muni yields close flat after more than a week of firmness; Texas to sell $7.8 billion in TRANs

By Sheri Kasprzak

New York, Aug. 23 - Municipal yields closed out Monday largely unmoved, halting a week and a half of dropping yields, said a trader.

"It has just been a very slow day, and nothing is budging one way or the other," he said.

"It could be worse. We could have starting making some gains before it stopped, but as it is, it's not a bad place to be. Record lows and then nothing."

The trader noted that Treasuries took a hit on Monday, and that might have prevented municipals from making any progress.

Meanwhile, the market is gearing up for Tuesday's sale of $7.8 billion in series 2010 tax and revenue anticipation notes from the State of Texas.

The notes (MIG 1/SP-1+/F1+) will be sold competitively with Raymond James & Associates Inc. as the financial adviser.

The notes are due Aug. 31, 2011.

Proceeds will be used to avoid a potential budget shortfall for the remainder of the fiscal year.

The state's comptroller, Susan Combs, noted in the preliminary official statement that the maximum temporary cash shortfall before the sale of the notes will be $10.8 billion.

Houston deal set

Also coming up on Tuesday out of Texas, the City of Houston plans to bring $229 million in series 2010C first-lien combined utility system revenue refunding bonds through RBC Capital Markets Corp.

Those bonds (Aa2/AA/AA-) are due 2011 to 2019, and the proceeds will refund and defease the city's outstanding series 1997E, 1999B-C and 2000A water and sewer system junior-lien revenue refunding bonds.

Nassau preps sale

Also coming up on Tuesday, Nassau County in New York is expected to sell $141.725 million in series 2010 general obligation bonds (Aa3/A+/AA-).

The bonds will be sold competitively in two tranches. The offering includes $126.62 million in series 2010C bonds and $15.105 million in series 2010D Build America Bonds.

The 2010C bonds are due 2012 to 2026, and the 2010D bonds are due 2026 and 2027.

Proceeds will be used for various public purposes, including payments to county employees, capital projects and judgments and settlements.

The county seat is Mineola, N.Y.

SCPPA bonds ahead

Looking to Wednesday's calendar, the Southern California Public Power Authority is gearing up to bring $533.065 million in series 2010-1 Windy Points/Windy Flat revenue bonds (/AA-/AA-) through J.P. Morgan Securities Inc.

The bonds are due 2011 to 2030.

Proceeds will be used to prepay for 11.1 million megawatt hours of wind power generation over a 20-year contract.

The authority is based in Pasadena, Calif.

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