Municipal bond issuance could run between $325 billion and $375 billion in 2015, analyst Tom Kozlik told a Philadelphia investor group.

Speaking before the Philadelphia Mutual Analyst Society, Kozlik, a director at Janney Capital Markets, said he expects refundings to fuel issuance.

New-money issuance is off from 2002-2010 totals, he said, because of lower revenue growth across all sectors and more austerity, minimal political and voter support for higher revenues and because of alternative debt products, such as direct bank loans.

Speaking Thursday at the Top of the Tower complex in Center City, Kozlik referenced Scottish historian and Harvard University professor Niall Ferguson who recently said: the fear landscape looks "remarkably unterrifying," compared with the last seven years.

"We'll see about that," said Kozlik. "But even if that is the case, there are many important topics credit analysts need to stay on top of in 2015 and beyond."

Municipal credit has declined in recent years despite a multi-year economic recovery, said Kozlik, who noted that Moody's Investors Service expects public-finance downgrades to outpace upgrades in 2015 amid "the new financial reality."

In a recent Bond Buyer video, Kozlik said about 125 local governments received downgrades in the second quarter of 2014, with  more than half due to multiyear structural imbalances. "That's something that is not easily fixed by local governments," he said.

Chris Mier, chief strategist at Loop Capital Markets, predicted another challenging year for muni portfolio management with the weight of most factors at least marginally stacked against issuers.

According to Mier, current pricing of credit risk, the yield curve, the level and likely direction of rates, the lack of attractiveness of munis and the direction of monetary policy all pose challenges.

Collaboration will be necessary for investors, he added. "Portfolio managers, traders and credit analysts will be working hard just to earn the coupon."

The outlook for the airport sector is stable, according to Mier, who expects domestic demand to continue to improve. Domestic demand is expected to continue to improve.

"We project enplanement growth of roughly 3% next year, although outperformance is possible based on the U.S. economy," he said.

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