DALLAS - At least one issuer on the Gulf Coast of Texas postponed plans to bring debt to market as Hurricane Ike bore down on the state on Friday, but industry professionals there said they were optimistic the market would be functioning normally this week.
One trader in Dallas said he expects most of the deals on this week's schedule to price, regardless of the eventual path of the hurricane. "Looks like everyone will just be in wait-and-see mode here over the weekend ... Not much else we can do," he said Friday afternoon.
Nearly one million people living on the Gulf Coast, including everyone on Galveston Island, were ordered to leave the area last week ahead of the storm. Both Houston airports were closed Friday afternoon.
Corpus Christi planned to get $12 million of combination tax and solid-waste revenue certificates of obligation sold late last week. But the issue was postponed ahead of the hurricane and now is expected to price next Monday, according to a spokeswoman at M.E. Allison & Co., the financial adviser to the city.
Morgan Keegan & Co. is lead manager for the issue and McCall, Parkhurst & Horton is bond counsel.
Standard & Poor's raised the underlying rating on the city's GO debt last week to AA-minus from A-plus, citing a large and diverse economic base, with sound financial management that's produced balanced annual budgets and general-fund balance increases for the past seven years.
The Corpus Christi City Council recently decided to put a $153 million bond referendum on the November ballot with the majority of the package for street improvements.
Fitch Ratings already had the city's GO credit rated at AA-minus, and Moody's Investors Service rates the largest Gulf Coast city at A1.
The city's current population of nearly 300,000 is up about 8% from the 2000 Census figure of 277,454. The taxable assessed valuation averaged 8.6% growth the past five years to a projected $13.8 billion for fiscal 2009.
The Port of Beaumont Navigation District expects to offer $9.9 million of revenue bonds competitively Wednesday, using proceeds for upgrades to the port in southeast Texas, as part of a $52.5 million capital improvement plan that began last year.
First Southwest Co. is financial adviser to the district. The firm's Houston office was closed Friday, but a representative in Dallas said the deal "is still a go."
Earlier this month, Moody's upgraded its underlying rating on the district's general obligation debt to A1 from A2 and raised the rating on revenue bonds to A2 from A3.
Fitch assigned an A rating to the sale and affirmed the rating on $21.4 million of GO debt outstanding and $16 million of revenue debt outstanding.
The revenue bonds are secured by a gross-revenue pledge and interest earnings on unrestricted fund balances. The GO bonds are secured by an unlimited ad valorem property tax within the district. The system's fiscal 2007 gross revenue of $19.3 million is up 37% from $14.1 million five years ago.
Fitch analysts said the port's imports have averaged 4.5% annual growth since 2003, reaching 2.6 million import tons last year, while exports remained relatively flat each year during the time period and were at 788,409 export tons in 2007.
The Harris County Cultural Education Facilities Finance Corp. is on the schedule with a roughly $12 million refunding of debt issued for the Houston Space Center. Officials weren't available Friday to comment on the status of the sale.
First Southwest is lead manager for the negotiated sale. Standard & Poor's assigned a BBB-minus rating to the bonds, which will be sold on behalf of the center's Manned Space Flight Education Foundation Inc.
"The rating reflects the museum's history of successful operation, limited competition within its science niche, established reputation, and position as a major destination site in Houston," credit analyst Bianca Gaytan-Burrell said.
