Municipal yields hold steady; San Diego USD prices; Los Angeles preps $1.2 billion TRANs sale

By Sheri Kasprzak

New York, June 28 - Municipal yields were largely unchanged to kick off the week, with some slight improvement seen on the short end of the curve, said market insiders.

"Intermediate and long are basically flat," said one trader.

"I'd say everything inside of five years is down by 1 or 2 bps at most. It's been a pretty quiet day. There's not a lot of movement, but there is a firmer tone."

Secondary action was relatively light, said the trader.

Amid the light action, the Guam Power Authority's recently priced series 2010A revenue bonds drew some interest. The 5% 2037 bonds were trading Monday afternoon at 4.881%.

Investors also showed interest in the Bay Area Toll Authority's Build America Bonds, which priced last week. The 6.793% 2030s were seen Monday afternoon at 6.586% after pricing Thursday at par.

San Diego USD sells

Looking to Monday's light primary action, the San Diego Unified School District sold $235 million in series 2010-11 tax and revenue anticipation notes, said a pricing sheet.

The notes (/SP-1+/) were sold through Citigroup Global Markets Inc. and J.P. Morgan Securities Inc. with De La Rosa & Co. as the co-manager.

The 2% notes are due June 30, 2011. The initial offering price was not immediately available.

Proceeds will be used to fund operating expenses, capital requirements and other obligations ahead of the collection of taxes and revenues.

L.A. preps sale

Moving to Tuesday's primary activity, the City of Los Angeles is set to bring $1.2 billion in series 2010 TRANs.

JPMorgan and Bank of America Merrill Lynch are the senior managers.

The notes are due March 31, 2011, May 31, 2011 and June 30, 2011.

Proceeds will be used to fund general operating expenses for the 2010-2011 fiscal year.

Massachusetts water deal ahead

In other Tuesday deals, the Massachusetts Water Pollution Abatement Trust is expected to bring $498 million in series 2010 state revolving fund bonds (Aaa/AAA/AA) through Goldman, Sachs & Co.

The proceeds will be used to fund loans for water and wastewater capital projects for 85 governmental units as well as refund the trust's outstanding stand-alone program bonds.

Jefferson Health sets deal

Also coming up on Tuesday, the Chester County Health and Education Facilities Authority and Hospitals and Higher Education Facilities Authority of Philadelphia are set to price $355 million in series 2010 health system revenue bonds for Jefferson Health System.

Citigroup is the senior manager.

The offering is comprised of $165 million in series 2010A bonds and $190 million in series 2010B bonds.

The 2010A bonds are due 2011 to 2020 with term bonds due 2030, 2035 and 2040. The 2010B bonds are also due 2011 to 2020 with term bonds due 2030, 2035 and 2040.

Proceeds will be used to finance an addition and improvements to the system's Paoli Hospital and to refund debt.

The health system is based in Radnor, Pa.

Virgin Islands offering slated

Out on the horizon, the Virgin Islands Public Finance Authority is set to price $396.265 million in revenue bonds, said a preliminary official statement.

The offering includes $308 million in series 2010A senior lien revenue bonds (Baa2/BBB/BBB+) and $88.265 million in series 2010B subordinate lien revenue bonds (Baa2/BBB-/BBB).

The maturities have not been set.

The bonds will be sold on a negotiated basis through Jefferies & Co. and Citigroup.

Proceeds will be used to provide a loan to the U.S. Virgin Islands for working capital and to refinance a portion of a working capital credit facility.

Based in Christiansted, the authority assists the government with fiscal duties and financing requirements for capital projects.

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