Los Angeles TRANs and Mass GOs Lead Estimated $8.7B Week

Los Angeles' $1.39 billion of Series 2015 tax and revenue anticipation notes and the Commonwealth of Massachusetts' $940 million GO bond sales lead the way in a week that is projected to produce $8.7 billion of new municipal volume, according to Ipreo and The Bond Buyer. That is up from the revised $6.5 billion priced in the week of June 15, according to Thomson Reuters.

In the short-term sector, Stifel is set to price the city of Los Angeles' $1.39 billion of Series 2015 tax and revenue anticipation notes on Wednesday.

"We have been doing the TRANs issue for a number of years now and by issuing the pension payments by July 15, we end up saving about $36 million, it is a significant way to save taxpayer dollars," said Miguel Santana, city administrative officer for Los Angeles.

The TRANs are rated MIG1 by Moody's Investors Service and SP1-plus by Standard & Poor's, the highest ratings you can get for TRANs.

"Our GOs were recently upgraded by Moody's, but I think the rating agencies are really recognizing that it's just not all about the numbers -- the numbers clearly show that the city's fiscal standing is much stronger -- but it is also about the management," said Santana. In 2008, "when the crisis hit, the city made a commitment to not pursue the easy routes and one time solutions but instead to confront those challenges in the short-term and to restructure itself in the long-term, and we are starting to see the benefits of that."

There is expected to be roughly $7.2 billion of negotiated deals next week, with Bank of America Merrill Lynch pricing the largest issue.

BAML is scheduled to price the Massachusetts GOs, consolidated loan of 2015, as Series C refunding bonds and Series 2015 A bonds on Tuesday after a one-day retail order period on Monday. The GOs are rated Aa1 by Moody's and AA-plus by S&P and Fitch Ratings.

"Right now it is scheduled for $690 million is refunding, to generate a little over 7% of PV savings and the $250 million of new money, which will be used for schedule capital spending," said Sue Perez, Assistant Treasurer of Debt Management.

Perez said officials are hoping the deal will go well, but will continue to monitor volatility in the market up until the day it prices.

"If the market turns away or get volatile, the refunding portion could change because if the rates go up then we lose savings," she said. "We are hoping there is pent up demand and people looking for our credit, and the nice part of a negotiated deal is that you can be flexible and work with the requests you get."

BAML will also price FirstEnergy Nuclear Generation Corp.'s $296 million of pollution control revenue refunding bonds on Wednesday. The bonds are rated Baa3 by Moody's and BBB-minus by S&P.

Citi is set to price the Philadelphia Authority for Industrial Development's $273 million of revenue bonds for Temple University. The bonds, slated for sale on Tuesday, are rated Aa3 by Moody's and A-plus by S&P. The bonds are expected to mature serially from 2016-2035 and have term bonds in 2040 and 2045.

BAML is slated to price the Maryland Health and Higher Educational Facilities Authority's $263 million of Series 2015 revenue bonds for the Meritus Medical Center. The deal will have a retail order period on Wednesday. The bonds are rated BBB by S&P and Fitch.

Stifel is expected to price the Industry Public Facilities Authority, Calif.'s $250 million of Series 2015B taxable tax allocation refunding bonds for the Industrial Redevelopment Project No. 2 on Thursday, The deal is rated A-minus by S&P.

Citi is expected to price the school board of Miami Dade County's $240 million of certificates of participation or COPs on Thursday. The COPs are scheduled to mature serially from 2016-2033 and are rated A1 by Moody's and A by S&P.

There is expected to be $1.5 billion of competitive sales, with the largest being Tuesday's offering from Seattle, Wash. The city is selling $164 million of Series 2015A municipal light and power revenue bonds. The issue is rated Aa2 by Moody's and AA by S&P.

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