SAN FRANCISCO - Days after Oregon lawmakers authorized $175 million of bonds designed to help stimulate the economy, the state will issue a large share of that debt as part of a $229 million issue of certificates of participation.
Gov. Ted Kulongoski signed the package into law Thursday, shortly after it cleared its final hurdle in the state House. The governor made the measure one of his top priorities this year and the Legislative Assembly, controlled by fellow Democrats, obliged.
"With less than 30 days into session, the legislature crafted an Oregon economic stimulus plan that invests in needed repairs to our schools, transportation system, and aging infrastructure while at the same time providing jobs to help families and get our economy moving," Kulongoski said in a statement.
More than half of the "Go Oregon" stimulus authorization is included in this week's $229 million Oregon Department of Administrative Services COP deal, said James Sinks, spokesman for state Treasurer Ben Westlund, who took office in January.
The bonds will price Tuesday after today's retail order period, according to Laura Lockwood-McCall, head of debt management for the treasurer's office.
Banc of America Securities LLC and Citi are senior managers for the deal, which includes a $214 million tax-exempt Series A, and a $15 million taxable Series B. This week's deal marks the debut of Westlund's new "Buy Oregon Bonds" marketing program, with a Web site and marketing campaign targeted at retail investors.
In the old reality that preceded the Lehman Brothers bankruptcy in September, Oregon typically would get about $40 million to $60 million in retail orders for a new issue for traditional retail-oriented maturities, Lockwood-McCall said.
The environment was different when the state went to market in October with a $20.3 million general obligation bond sale, which went entirely to retail.
"The sale we did in October found buyers all along the yield curve," Lockwood-McCall said. "Were shooting to try and find them."
With a 9% top state income tax bracket, Oregon residents do have an incentive to buy in-state bonds.
"We typically pick underwriters with strong retail networks for our syndicates," the debt manager said.
There will be more deals to come, starting with a $147 million GO sale the week of March 2.
Also expected this spring are $350 million of highway user tax revenue bonds for the Oregon Department of Transportation, and a $389 million lottery revenue bond sale.