Municipal bond yields seen slightly weaker; Nashville prices $575 million of G.O. bonds

By Sheri Kasprzak

New York, June 3 - Municipal bond yields were mostly unchanged, but some weakness did creep back into the market, traders reported Thursday.

Yields were seen off by about 1 to 2 basis points, one trader said.

"It looks like we're just giving up any gains we saw yesterday," he said. "Everywhere else, we're basically flat."

Meanwhile, in the primary market, the Metropolitan Government of Nashville and Davidson County in Tennessee brought to market $575 million in series 2010 general obligation bonds, according to pricing sheets.

The sale included $275 million in series 2010A G.O. improvement and refunding bonds, $250 million in series 2010B Build America Bonds and $50 million in series 2010C taxable G.O. refunding bonds.

Goldman Sachs & Co. was the senior manager.

The 2010A bonds are due 2015 to 2026 with coupons from 2.75% to 5%. The 2010B bonds are due 2034 with a 5.707% coupon, priced at par. The 2010C bonds are due 2013 to 2015 with coupons from 2.208% to 3.23%, priced at par.

Proceeds will be used to retire the government's series 2010A-B commercial paper, which provided short-term financing to construct, acquire, equip and renovate capital projects, as well as to refund several series of outstanding bonds.

Montgomery IDA prices deal

In other offerings, the Montgomery County Industrial Development Authority of Pennsylvania sold $313.84 million in series 2010 FHA-insured mortgage revenue bonds, according to a pricing sheet.

The bonds were sold through Goldman Sachs.

The bonds are due 2013 to 2020 with term bonds due 2024, 2025, 2030, 2033 and 2038. The serial bonds have 5% coupons. The 2024 bonds have a 5% coupon, the 2025 bonds have a 5.5% coupon and the 2030 bonds have a 5.75% coupon. The 2033 bonds have a 5.25% coupon. The 2038 bonds have a 5.375% coupon.

The full pricing details were not immediately available.

Proceeds will be used to construct a new hospital in East Norriton, Pa.

San Diego bonds sold

Also on Thursday, the San Diego County and San Diego County School Districts priced $264.745 million in series 2010 tax and revenue anticipation notes, according to a pricing sheet.

"It went well," said one sellsider close to the offering.

"We're pleased with the pricing. We feel their solid rating, and their strength as an issuer in general, helped get them the pricing they were after."

The deal included $140 million in series 2010A notes, $22.84 million in series 2010B-1 notes, $98.205 million in series 2010B-2 notes and $3.7 million in series 2010B-3 notes.

The notes (/SP-1+/) were sold through RBC Capital Markets Corp. and De La Rosa & Co.

The 2010A notes are due June 30, 2011, with a 2% coupon priced at 101.61. The 2010B-1 notes are due Jan. 31, 2011, with a 2% coupon priced at 100.734. The 2010B-2 notes are due April 29, 2011, with a 2% coupon, priced at 100.904. The 2010B-3 notes are due April 29, 2011, with a 2% coupon priced at 100.863.

The county and school district will use the proceeds to finance capital projects ahead of the collection of taxes and revenues.

Compton prices bonds

Elsewhere, the Community Redevelopment Agency of the City of Compton, Calif., sold $100.725 million in series 2010 second-lien tax allocation bonds (/A-/), according to a term sheet.

The offering included $31.13 million in series 2010A housing bonds, $51.335 million in series 2010B bonds and $18.26 million in series 2010C taxable bonds.

Grigsby & Associates Inc. was the senior manager.

The 2010A bonds are due 2011 to 2022 with term bonds due 2025, 2030 and 2042 with coupons from 3% to 5%. The 2025 bonds have a 5% coupon, priced at 96.391. The 2030 bonds have a 5.5% coupon, priced at 97.614. The 2042 bonds have a 6% coupon, priced at 98.588.

The 2010B bonds are due 2025 to 2026 with term bonds due 2030, 2035 and 2042. The serial bonds have coupons from 5% to 5.75%. The 2030 bonds have a 5.7% coupon, priced at par. The 2035 bonds have a 6% coupon, also priced at par. The 2042 bonds have a 6% coupon, priced at 98.588.

The 2010C bonds are due 2020 and 2024. The 2020 bonds have a 7.29% coupon, priced at par. The 2024 bonds have a 7.74% coupon, priced at par.

Proceeds will be used to fund low- to moderate-income housing redevelopment activities, as well as to finance tax-sharing obligations payable to Compton Unified School District.

The agency provides financing for city redevelopment activities.

Delaware road deal prices

Also on Thursday, the Delaware Transportation Authority priced $113.49 million in series 2010 grant anticipation bonds, according to a pricing sheet. The sale was downsized from $115 million.

The bonds (Aa2/AA/) were sold through Bank of America Merrill Lynch.

The bonds are due 2011 to 2020 with term bonds due 2022 and 2025. The coupons range from 2% to 5%.

Proceeds will be used to acquire rights of way and begin construction on U.S. Route 301 at the Maryland-Delaware state line.

The authority is based in Dover, Delaware.

Wisconsin plans sale

Looking to upcoming offerings, the State of Wisconsin announced plans Thursday to sell $800 million in series 2010 operating notes on June 15, according to a notice of sale released by the issuer.

The notes are due June 15, 2011.

The state, according to the preliminary official statement, is issuing the notes because of an imbalance in the timing of payments disbursed from and receipts collected in the general fund. The proceeds will fund cash flow needs for the 2010-11 fiscal year.

Illinois road deal ahead

Also coming up, the Illinois State Toll Highway Authority plans to bring to market $400 million in series 2010A toll highway senior refunding revenue bonds on June 10, according to a preliminary official statement.

The bonds will be sold in two tranches - a 2010A-1 tranche and a 2010A-2 tranche. The breakdown of those tranches had not been determined Thursday.

Bank of America Merrill Lynch and Siebert Brandford Shank & Co. LLC are the senior managers.

Proceeds will be used to refund existing debt.

The authority, based in Downers Grove, Ill., operates the state's toll highways.

Nassau County sets pricing

Coming up on Tuesday, Nassau County in New York is scheduled to price $210 million in series 2010 revenue anticipation notes, according to a notice of sale.

The deal includes $130 million in series 2010A notes and $80 million in series 2010B notes.

The notes (MIG1/SP-1+/F1+) will be sold competitively with Public Financial Management Inc. as the financial adviser.

The 2010A notes are due March 15, 2011, and the 2010B notes are due April 15, 2011.

Proceeds will be used to fund capital requirements ahead of the collection of certain county revenues.

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