Week ahead filled with new issues; Empire State Development to price $462.56 million deal

By Cristal Cody and Sheri Kasprzak

New York, Jan. 4 - Even though the muni market was slow in the week following the New Year holiday, activity is picking up in the coming week, market insiders said.

"I think it's pretty normal," said one sell-sider. "Around the holidays, things get slow, but I see lots of stuff coming in the next week and in the week after that."

Another sell-sider also noted that a large slate of issues is planned for the coming week, led by a rather large issue out of New York State.

"I have noticed a number of pretty big offerings but I've also seen several small deals too," he said. "I don't think there's necessarily a trend toward bigger issue sizes. Different issuers have different needs."

Upcoming negotiated deals

New York issuer the Empire State Development Corp. has the largest negotiated offering in the coming week, gearing up to price $428.455 million in series 2008A-1 state revenue income tax and $34.11 million in series 2008A-2 state revenue income tax bonds with Citigroup Global Markets as the lead manager.

Merrill Lynch & Co., M.R. Beal & Co. and Siebert Brandford, Shank & Co. LLC are the co-managers in the issue.

Those bonds (Aaa/AA-) are set to price on Wednesday, according to a source familiar with the issue. The bonds have a serial structure from 2008 through 2027 and the 2008 through 2017 maturities are taxable with the rest tax-exempt.

Also coming up next week is a $168 million bond issue from the Albany, N.Y., Industrial Development Agency/St. Peter's Hospital. The bonds (Baa2/BBB+) will price Tuesday.

Monterey Peninsula, Calif., Community College is also planning to price an issue of $96 million in bonds (A3/AA-) on Wednesday. Those bonds are being sold in a serial structure with maturities from 2008 through 2016.

Competitive offerings ahead

Looking to the coming week's competitive issues, Washington state intends to price on Tuesday $546.245 million in bonds with a serial structure of maturities from 2009 through 2033.

Also from Washington next week is a $375 million issue of bonds, also with a serial structure from 2009 through 2033.

Washington-based issuers have a busy schedule with Port of Tacoma, Wash., also set to price bonds. The $113.265 million issue is set to price Tuesday with a serial structure from 2014 through 2038.

On Wednesday, the state of New Hampshire plans to price $75 million in a competitive issue.

The bonds will be sold with serial maturities from 2009 through 2027.

Oklahoma issuers coming in spring and summer

Issuers based in Oklahoma expect to place two bonds issues totaling $175 million this year.

The University of Oklahoma Health Sciences Center will sell up to $75 million, as authorized by the state legislature, in tax-exempt and taxable bonds in March or April, but probably not any earlier.

"It's possible if things pick up in the next weeks, but it's optimistic to think we could do it in less than three months," James Joseph, state bond advisor for the Oklahoma State Bond Advisor, which assists the governor and Oklahoma Legislature, told Prospect News Friday.

The proceeds will be used to create a new cancer research center.

Later in the spring or early summer, the state also will sell $100 million in bonds as a grant and revenue anticipation vehicle for federal highway dollars, Joseph said. The bonds are awaiting state approval.

New York Power Authority bonds

An enormous issue of bonds from the New York State Power Authority will reportedly price at the end of the month.

The authority, according to a release Friday from Moody's Investors Service, will price $775 million in commercial paper notes, series 1, 2 and 3.

The bonds were rated P-1 by Moody's on Friday and are set to price Jan. 31, according to the statement from Moody's.

Also coming up is a $125 million issue of general obligation bonds from Nassau County, N.Y. The county plans to price $100 million in 2008 series A general obligation bonds and $25 million in 2008 series B G.O.s on Jan. 15, according to Moody's. Both series are rated A2 by the ratings agency.

Proceeds from the A bonds will be used to finance general improvement projects throughout the county. The B bonds will finance sewer district projects.

Elsewhere, the Bon Secours Health Systems, Inc. Health Care-Hospital Virginia plans to price several revenue bonds.

The bonds include $69.925 million in series 2008A bonds (A3), $40.345 million in series 2008B-1 bonds (A3), $40.35 million in series 2008B-2 bonds (A3) and $46.22 million in series 2008C-2 bonds (A3). All of the bonds are expected to price Jan. 14, according to a statement Friday from Moody's.

The proceeds will be used to reimburse the system for $152 million in prior capital expenses in South Carolina and Virginia and refund the $81 million in series 2003 bonds used to construct St. Francis Hospital in Chesterfield, Va.

Citigroup Global Markets is the lead manager.

Texas A&M bond sale starts Thursday

The Board of Regents at the Texas A&M University System will sell $175.59 million in competitive revenue financing system bonds beginning Thursday.

The series 2008 bonds (Aa1/AA+) have serial maturities from May 15, 2008 to May 15, 2037. First Southwest Co. is the financial advisor.

"We're looking forward to having a lot of bidders and to having great pricing on the 10th," Greg Anderson, Texas A&M's associate vice chancellor and treasurer, said Friday.

The board encourages women- and minority-owned businesses to submit bids for the bonds, based on an amendment by the Texas Legislature for higher education institutions. The board's goal is that 25% of bidding come from those groups.

The university system is issuing the bonds to help fund several new campus projects, including residential housing for West Texas A&M University and a wellness center for Texas A&M Corpus Christi.

Moody's rates $437.8 million bonds from Ohio

Moody's on Friday assigned a stable outlook to the Columbus, Ohio, sewage system revenue bonds up for sale Jan. 14.

The $385.68 million in the sewerage system fixed-rate revenue bonds, series 2008A, received a rating of Aa2.

The sewerage system adjustable-rate revenue bonds, series 2008B, of $52.1 million received the Aa2/VMIG 1 rating.

The bonds are secured by a pledge of net revenues from the city's sewer enterprise system.

The majority of proceeds will finance first phase capital projects of the city's wet weather management plan to control sewer overflow, and a portion will be used to refinance existing sewer revenue debt.

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