Municipals finish mostly flat; Empire State Development plans $1.5 billion sale for Tuesday

By Sheri Kasprzak

New York, Nov. 13 - Municipals rounded out a shortened week mostly unchanged, but there was a firmer tone to the market, a trader reported.

"It's a quiet day, but there's a firmer feeling, especially long," she said.

"I think we've gotten a break from so much new issue supply. That's helping somewhat, and [the] Treasury auction also helped us out. We're pretty much following Treasuries. Those things combined to make it a pretty decent day. Hopefully, that will carry over into next week."

In the secondary market, the Kentucky Economic Development Finance Authority's recently priced revenue bonds for St. Elizabeth Medical Center were trading. The 5.125% 2029 bonds were seen trading at 5.039% Friday afternoon.

In other trading news, Washington Health Care Facilities Authority's series 2009 bonds priced for Fred Hutchinson Cancer Research Center were seen in action. The 5.25% 2024s were seen at par.

Looking ahead, at least two billion-dollar offerings are set to price.

The Empire State Development Corp. of New York is set to sell $1.501 billion in series 2009 New York State urban development state personal income tax revenue bonds on Tuesday, according to a sales calendar.

The sale includes $501.51 million in series 2009C bonds, $224.12 million in series 2009D taxable bonds and $775.615 million in series 2009E Build America Bonds.

The bonds (/AAA/AA) will be sold through lead manager Goldman, Sachs & Co.

Proceeds will be used to fund capital improvements.

California PWB sale planned

The other billion-dollar offering comes from the California State Public Works Board. It is scheduled on Thursday to bring to market $1.09 billion in tax-exempt bonds, said a sales calendar.

The bonds will be sold on a negotiated basis.

The sale includes series 2009I-1 bonds (Baa2/A-/BBB-) and series 2009J Build America Bonds (A1/A-/BBB-). The exact breakdown was not available Friday, but the Build America Bonds portion was expected to make up about $250 million of the offering.

Wachovia Bank NA is the senior manager for the tax-exempt bonds, and Jefferies & Co. is the lead manager for the Build America Bonds.

Proceeds will be used to construct, acquire, equip and operate public buildings.

Muni Gas Authority of Georgia sale ahead

In other upcoming sales for the week ahead, the Municipal Gas Authority of Georgia is expected to sell $150 million in gas portfolio III revenue refunding bonds on Wednesday, said a preliminary official statement.

The sale includes $75 million in series G bonds and $75 million in series H bonds.

The bonds (MIG 1/SP-1+/F1+) will be sold on a negotiated basis with Wells Fargo Securities Inc. and J.P. Morgan Securities Inc. as the lead managers.

The G bonds are due May 19, 2010, and the H bonds are due Nov. 18, 2010.

Proceeds will be used to refund existing debt issued by the authority.

The authority is based in Kennesaw, Ga.

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