CHICAGO — Milwaukee will competitively sell $225 million of revenue anticipation notes Tuesday on behalf of Milwaukee Public Schools to help it manage its cash flow.

Robert W. Baird & Co. is financial adviser, Katten Muchin Rosenman LLP is bond counsel, and Hurtado SC is co-counsel. The deal includes a $50 million tranche that matures at the end of December and a $175 million tranche maturing June 27.

The annual issue helps the district manage cash flow, but was delayed two months this year to reduce the net interest cost by shortening the maturity length, according to Michael Daun, deputy to city Comptroller W. Martin Morics. The comptroller’s office manages city and school issuance.

Milwaukee tapped its own lower-cost general obligation commercial paper program to provide cash-flow financing during the two-month delay. The lower cost of borrowing coupled with the decision to put some of the Rans in a shorter December maturity should save about $100,000 in net interest costs, Daun said.

Milwaukee serves as issuer for school debt. Its GO pledge does not back the Rans, but interest on the debt does enjoy the additional security from surplus revenue in the city’s debt-service fund and the city annually covers repayment of interest.

All three rating agencies assigned their highest short-term marks to the debt ahead of the sale. The notes are secured by about $1.4 billion of revenues the school system expects to collect in fiscal 2010-2011, including its share of property taxes, federal aid, and an estimated $544 million of Wisconsin state aid.

The rating “reflects reasonable cash-flow projections, solid expected debt-service coverage, and the segregation of funds prior to note maturity,” wrote Moody’s, which also affirmed the district’s Aa2 issuer credit rating.

That rating is supported by the district’s large tax base, adequate general fund reserves, and a moderate debt profile.

The school system has struggled both financially and academically, but the Rans benefit from the district’s historically conservative cash-flow projections.

The district posted budget surpluses until 2008 when it was forced to begin drawing down its general fund balance. It ended fiscal 2010 in the black with a year-end balance of $39.4 million and it projects a 2011 balance of $38.3 million.

“We believe that the ability of the district to maintain structural financial balance will be an important factor in future credit analysis,” Moody’s wrote. “Continued diminution of reserves or departure from projected financial results may indicate a deterioration of credit quality.”

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