Colorado sells $500 million, receives $4.15 billion of bids; Build America Bond market active

By Cristal Cody

Tupelo, Miss., Dec. 9 - The State of Colorado sold $500 million of 2% general fund tax and revenue anticipation notes due June 27, 2011 in a deal that attracted widespread interest in the municipal bond market on Thursday, a source said.

The state priced the series 2010 notes (MIG1/SP1+/) to yield 0.295% to 0.3%, an informed source said.

The notes were sold at a true interest cost of 0.29892% through a competitive sale. J.P. Morgan Securities LLC was the winning bidder.

The state received 30 bids on the sale from 13 firms.

"The bids totaled $4.15 billion, so that covered the sale amount 8.83 times," the source said.

Stifel, Nicolaus & Co., Inc. was the financial adviser.

Proceeds will be used to fund anticipated cash flow shortfalls in the state's general fund in the July 1, 2010 to June 30, 2011 fiscal year.

December continues to appear busy. New sales were announced by the Wayne County Building Authority of Michigan, the Illinois Housing Development Authority and the District of Columbia.

The market is expected to stay active for Build America Bonds until the Dec. 31 expiration of the program, a source said.

"More BABs are coming by the end of the year," the source said. "This year, a little over 25% of the new issue volume has been BABs."

District of Columbia to price

The District of Columbia plans to sell $172.455 million of general obligation bonds, according to a preliminary official statement.

The offering includes $90.24 million of series 2010A Build America Bonds and $82.215 million of series 2010B bonds.

The negotiated sale will be managed by Citigroup Global Markets Inc. and Siebert Brandford Shank & Co., LLC.

Proceeds will be used to finance capital project expenditures.

Wayne County authority to sell

In other upcoming sales, the Wayne County Building Authority in Michigan plans to sell $200 million of series 2010 G.O. jail facilities building authority bonds, according to a preliminary official statement.

The bonds (A3/A-/A-) will price through a negotiated sale.

JPMorgan is the senior manager.

Proceeds will be used to pay for new county criminal justice and jail facilities.

The authority is based in Detroit.

Illinois Housing deal ahead

Also ahead, the Illinois Housing Development Authority intends to sell $53.05 million of multifamily housing revenue bonds for Randolph Tower City Apartments, according to a preliminary official statement.

The bonds (/AAA/) have serial maturities from 2014 through 2022 and a term bond due 2028.

Citigroup will manage the negotiated sale.

Proceeds will be used to renovate a 45-story historic official building in the Chicago Central Business District and convert them into apartments.

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