Paulding County, Ga., school district sells $62.5 million in G.O.s; market remains uneasy

By Cristal Cody and Sheri Kasprzak

New York, July 24 - Muni action was again sparse as issuers reconsider their offerings in light of spotty market conditions and threats of downgrades for insurers.

"I'm not going to lie," said one market source reached Thursday afternoon. "It's really not the time to price right now. I think things will get better, probably in the next few months.

"If the insurers get downgraded, there are ways around it. I imagine we'll see more and more issuers going uninsured if they can."

Earlier this week, Moody's Investors Service announced it was reviewing Financial Security Assurance and Assured Guaranty for possible downgrades. The agency downgraded FGIC in April.

Heading up Thursday's pricing activity, Paulding County School District in Georgia priced $62.5 million general obligation bonds with 1.65% to 4.48% yields, according to an official statement.

The series 2008 bonds (Aa1/AA+/) priced with 3% to 5% coupons.

The bonds have serial maturities from 2009 through 2024.

Morgan Keegan & Co. managed the negotiated sale.

Proceeds will be used for land purchases, classroom additions and renovations as well as to construct and equip new schools.

California sciences academy deal

In other news, the California Academy of Sciences had been expected to price $287.89 million in series 2008 variable-rate demand revenue bonds (A2), but calls to the issuer for additional information were not returned.

The bonds were sold on a negotiated basis with JPMorgan as the senior manager.

The sale includes $95.605 million in series 2008A bonds, $60.165 million in series 2008B bonds, $48.29 million in series 2008C bonds, $34.52 million in series 2008D bonds, $24.655 million in series 2008E bonds and $24.655 million in series 2008F bonds.

Proceeds will be used to refund the academy's outstanding series 2003A, 2005A and 2005B bonds and to fund a portion of capital projects. The rest will be used for working capital.

Also on Thursday, the Imperial Irrigation District of California was scheduled to price $240 million in debt securities. Calls to the issuer for the terms were not returned by press time.

The bonds were sold through lead manager Citigroup Global Markets, and proceeds will be used for capital improvements to the electric system.

Texas sales

Two Texas sales were planned for Thursday, but calls to confirm the sales were not immediately returned.

Austin, Texas, planned to price $175 million electric utility system revenue refunding bonds through a competitive sale.

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

Proceeds will be used to refund Austin's outstanding commercial paper, which will allow the city to restore the available capital under its commercial paper note program and to sell additional notes.

The Texas Transportation Commission was expected to price $169.16 million state highway fund first tier revenue bonds.

The series 2008 bonds (Aa1/AAA/) have serial maturities from 2010 through 2028.

Morgan Keegan & Co. was the senior manager of the negotiated sale.

Proceeds will be used to finance state highway improvement projects.

Texas State University offering

Looking to upcoming sales, the Board of Regents at Texas State University System expects to price $217 million revenue bonds the week of July 28, a source said Thursday.

"It's sometime next week," she said.

The series 2008 revenue financing system bonds (Aa3/AA-/) have serial maturities due Aug. 27, 2008 and March 15, 2009 through March 15, 2028.

Lehman Brothers is the senior manager of the negotiated sale.

Proceeds will be used to refund outstanding debt and to acquire, construct, renovate and equip property, buildings and roads for the university system.

St. Louis Park sale planned

In other upcoming offerings, the City of St. Louis Park in Minnesota plans to price $221.045 million health care facilities revenue refunding bonds for Park Nicollet Health Services, according to a preliminary official statement.

The series 2008C bonds (/A/) will be sold in a negotiated sale managed by Morgan Stanley and Wells Fargo Brokerage Services LLC.

Proceeds will be used to refund the series 2003A periodic auction reset revenue bonds, to pay interest rate swap termination fees and to fund a debt service reserve fund.

Calls for additional information were not immediately returned.

Cleveland income tax

Cleveland, Ohio, expects to price $62.09 million subordinate lien unrestricted income tax bonds on Monday, a source told Prospect News.

The series 2008 police and fire pension payment bonds have serial maturities from 2009 through 2018.

Morgan Stanley is the senior manager of the negotiated sale.

Proceeds will be used to refund the city's series 1994 variable-rate refunding bonds and to fund interest on the series 2008 bonds for six months.

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