New Jersey Turnpike to sell $275 million BANs; L.A. Water Department to bring $150 million Tuesday

By Aaron Hochman-Zimmerman and Sheri Kasprzak

New York, Jan. 26 - A new slate of offerings emerged for the week - albeit a slightly leaner slate than the week prior.

"It's still a tough market to price in," said one sellside source reached Monday afternoon.

"I think it's better than it was a few months ago, but it's still a catch-as-catch-can proposition to price. It really varies from day to day."

An issuer agreed with that assessment.

Nigel Lewis, senior debt analyst for King County, Wash., said his county's bonds very well may be pulled from the market if market conditions are not ideal.

The county is expected to sell $51.325 million in general obligation refunding bonds Feb. 2.

"We have a significant cushion," Lewis told Prospect News Monday.

"It would be naïve to say things couldn't unravel quickly."

The bonds (Aa1/AAA/AA+), due 2009 to 2019, are set to go competitively with Foster Pepper PLLC as financial adviser.

The county expects yields from 1.7% to 3.6%.

Proceeds will refund the outstanding 1998 series A limited tax G.O. refunding bonds.

N.J. Turnpike BANs

Heading up the slate of upcoming sales is a $275 million offering of series 2009 subordinate turnpike revenue bond anticipation notes from the New Jersey Turnpike Authority.

The BANs (MIG 1) are due Dec. 31, 2009, and will be sold on a negotiated basis with Goldman, Sachs & Co. as the senior manager, according to a preliminary official statement released Monday.

Proceeds will be used to refund the authority's series 2008B BANs, repurchase its series 1991D, 2000B-G, 2003C and 2003D bonds and fund improvements to the turnpike system.

Also coming up, the Los Angeles Department of Water and Power is scheduled to price $150 million in series 2009 water system revenue bonds Tuesday, said a calendar of upcoming sales.

The bonds (Aa3/AA/AA) will be sold on a negotiated basis with J.P. Morgan Securities Inc. and Morgan Stanley & Co. Inc. as the senior managers.

The bonds are due 2016 to 2029 with term bonds due 2034 and 2038.

Proceeds will be used to improve the city's water system.

Triborough Bridge deal

Tuesday's schedule of offerings will be led by a $400 million sale of series 2009 mandatory tender bonds and revenue bonds from the Triborough Bridge and Tunnel Authority of New York.

The authority will sell $150 million in series 2009A-1 general revenue mandatory tender bonds and $250 million in series 2009A-2 general revenue bonds through senior managers Barclays Capital Inc. and Loop Capital Markets LLC.

Proceeds will advance the authority's projects and refinance existing projects.

Also coming up on Tuesday, the Washington Suburban Sanitary District is gearing up to sell $165 million in series 2009 consolidated public improvement bonds competitively. Public Advisory Consultants Inc. is the financial adviser.

The 10-year bonds will be used to construct or repair sewage facilities as well as replace short-term bond anticipation notes.

Lancaster school sale

Also this week, the Lancaster County School District in Nebraska will bring $100 million in series 2009 G.O. school bonds on Wednesday, said a preliminary official statement.

The bonds (Aa1/AAA/) will be sold on a competitive basis with Ameritas Investment Corp. as the financial adviser.

The bonds are due 2010 to 2039, and the maximum coupon for the bonds will be 5.75%.

Proceeds will be used for the construction and renovation of schools within the district.

Connecticut prices $415.035 million

Looking to recent pricing action, the State of Connecticut priced late last week $415.035 million in series 2009-1 second lien special tax obligation refunding bonds, said an official statement released Monday.

The bonds (A1/AA/AA-) were sold through lead managers Goldman Sachs and Banc of America Securities LLC on Thursday.

The bonds are due 2010 to 2022 with coupons from 2.5% to 5% and yields from 0.43% to 4.35%.

Proceeds will be used for transportation infrastructure costs.

Secondary flattens

In the secondary market, municipals shook off a dismal week and remained fairly flat on Monday, a trader said.

"I'd say it's fairly flat today," the trader said.

"Volume looks pretty good. We've seen quite a few trades, so there is interest out there [in secondary munis], but we're pretty much unchanged."

Another trader said the unchanged market comes as a surprise given weakness in the Treasury market Monday.

"I'm really surprised we're not having an off day," he said.

"It's actually not that bad compared to last week. Treasuries are off and we normally follow, but that's not quite the case today."

Moving to specific trades, Westchester County, N.Y.'s series 2009A G.O. bonds were seen in action. The 4% 2023s were seen at 4.18% on Monday. The bonds priced late last week.

Also priced last week, the New York City Municipal Water Finance Authority's series EE water and sewer system bonds were trading Monday. The 5% 2039s were trading at 5.275%.

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