SAN FRANCISCO — California this afternoon abruptly announced plans to price $750 million of taxable general obligation Build America Bonds tomorrow.
The announcement comes as the state gears up for a $1.5 billion tax-exempt bond offering, and the BAB sale is separate from and in addition to the tax-exempt deal, said Tom Dresslar, spokesman for Treasurer Bill Lockyer.
“This is a separate transaction,” he said. “This public offering is the result of an inquiry we received from a party that expressed an interest in buying a substantial amount of Build America Bonds from the state of California.”
Citi is managing the BAB offering. They will be 30-year bonds, Dresslar said.
The direct-pay BABs receive a 35% subsidy from the U.S. Treasury.
Also yesterday, state finance director Michael Genest announced plans to leave the position, responsible for putting together the governor’s budget, after four years. He said he plans to leave by the end of the year, after Gov. Arnold Schwarzenegger names a successor.
California’s tax-exempt bond sale, slated to include $1.3 billion of new-money GOs and $194 million of refunding GOs, is scheduled to price Wednesday after a retail order period Tuesday.
De La Rosa & Co., Stone & Youngberg LLC, and Siebert Brandford Shank & Co. are managing that deal.
