New York State Urban Development plans $1.098 billion sale; secondary remains firmer with low volume

By Sheri Kasprzak

New York, Dec. 24 - In a short session for the municipals market, more offerings emerged Wednesday for the coming New Year, led by a $1.098 billion sale of revenue bonds from the New York State Urban Development Corp.

Meanwhile, in the secondary market, trading volume continued to gasp for life, even as the tone of the market firmed slightly.

"It's looking a bit firmer today," noted one trader reached in the late morning Wednesday.

"Not a whole lot going on really. That's to be expected though."

In the primary market, one of the largest deals of January was announced. New York State Urban Development is set to sell $1,097,750,000 in series 2009 state personal income tax revenue bonds in January, said a preliminary official statement.

The offering includes $479.485 million in series 2009A economic development and housing bonds and $618.265 million in series 2009B state facilities and equipment bonds.

The 2009A bonds include $348.1 million in series 2009A-1 tax-exempt bonds and $131.385 million in series 2009A-2 federally taxable bonds. The 2009B bonds include $511.305 million in series 2009B-1 tax-exempt bonds and $106.96 million in series 2009B-2 federally taxable bonds.

The bonds will be sold on a negotiated basis with Citigroup Global Markets as the senior manager.

Proceeds will be used for revitalizing communities by providing capital to municipalities to restore, renovate and revitalize commercial and residential properties. The proceeds will also be contributed to the New York State Technology and Development Program for the construction, design, acquisition and preparation of technology projects throughout the state. The remainder will be used for a variety of grants and loans.

New Orleans deal ahead

Also coming up this January, the New Orleans Aviation Board is set to sell $138.88 million in series 2009 revenue refunding bonds in the early part of the month, said a preliminary official statement.

The sale includes $77.225 million in series 2009A-1 non-AMT bonds, $18.73 million in series 2009A-2 non-AMT bonds, $25.87 million in series 2009B AMT bonds and $17.055 million in series 2009C taxable bonds.

The bonds will be sold on a negotiated basis with Morgan Keegan & Co. as the senior manager.

Each series of bonds is due 2010 to 2023.

Proceeds will be used to refund and defease the board's series 1993 and 1997 bonds and to pay fees related to the termination of a swap agreement.

Secondary remains quiet

Despite a slightly firmer market tone, trading action remained very light ahead of the Christmas holiday, said a trader reached in the morning Wednesday.

There were a few trades to report. The North Carolina Health Care Commission's series 2008C revenue bonds were in play, with the 4.45% 2017s seen trading at 5.511%.

Also traded Wednesday was the City of Philadelphia's series 2008B G.O. bonds. The 7.125% 2038s were trading at 6.281%. The bonds priced Dec. 16 to yield 7.25%.

Elsewhere, the Deschutes County Hospital Facilities Authority of Oregon's revenue bonds for Cascade Health were trading. The 7.25% 2018 bonds were trading at 6.428%. The bonds priced Dec. 18 to yield 6.75%.

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