The retail order period began Tuesday for Connecticut's $600 million sale of Series 2013A special tax obligation bonds, with proceeds to fund transportation infrastructure projects. The institutional sale is set for Wednesday.
A gross lien on pledged revenues and other receipts deposited to Connecticut's special transportation fund secure the bonds.
Siebert Brandford Shank & Co. is the lead manager. Moody's Investors Service rates the bonds Aa3, while Standard & Poor's and Fitch Ratings each assign AA ratings.
"The STO bond program is a well-established part of a comprehensive and legislatively authorized long-term transportation infrastructure program," Fitch said in a report. "Revenue forecasting and budgeting is conservative, although rising debt service and higher transportation needs present ongoing challenges."
Fitch, which earlier this year assigned a negative outlook to the state's GO bonds, provided a stable outlook to the STO issuance.
The STO bonds are issued under a senior and second lien. Pledged revenues include taxes and fees on motor vehicle fuel, casual vehicle sales, licenses and transfers from the state's general fund of taxes collected on oil companies' gross earnings and other statutory transfers.
Connecticut's General Assembly authorized $709 million of STO bonds in fiscal 2014 and $588 million in fiscal 2015.
Tighter budgeting was theme last week when Gov. Dannel Malloy met with all state agency commissioners in Hartford. Malloy said streamlining has saved the state $2 billion since he took office in 2011.
"We are making progress in putting Connecticut's finances back in order," state budget director Benjamin Barnes said in a letter to Malloy. Implementing generally accepted accounting principles should make budgeting more transparent and stable, he said.