New York City plans to sell $1.1 billion of bonds this month, beginning with the marketing of $475 million of tax-exempt fixed-rate bonds and $50 million of taxable fixed-rate bonds on April 15.
A three-day retail order period for the tax-exempt bonds will begin on Thursday. The taxable bonds will be sold competitively. In late April, the city plans to sell $540 million of tax-exempt variable-rate demand bonds.
Banc of America Securities LLC will lead manage the tax-exempt fixed-rate deal and Bear, Stearns & Co., Merrill Lynch & Co., and Morgan Stanley will be co-senior managers.
Sidley Austin LLP is bond counsel, Public Resources Advisory Group and A.C. Advisory Inc. are financial advisers on the deals.
A decision whether or not to insure the bonds will be made on the day of the sale and the bonds' structure will be determined closer to the sale, said New York City director of investor relations Raymond Orlando.
The underwriting team and liquidity provider or providers on the VRDBs will be announced closer to the sale, Orlando said.
Meantime, as the New York Legislature readied itself for a weekend of work trying to pass a late budget on Friday, one former budget director recalled that there are different concepts of lateness.
"I remember late," said Dall Forsythe a professor at New York University who served as state budget director under former Gov. Mario Cuomo. "Late was June or July or August. [This budget is] not very late."
Last year the Legislature passed its operating budget just hours past the March 31 midnight deadline. Much is different this year after a prostitution scandal brought down former Gov. Eliot Spitzer, forcing his Lieut. Gov. David Paterson to become governor last month and quickly get up to speed on the budget process.
The contentious issue of congestion pricing - a plan to charge fees on drivers in a large portion of Manhattan to pay for transportation projects - coincided with passing the budget and has reportedly delayed proceedings. The Legislature must pass a congestion pricing bill by today in order to qualify for $354 million of federal funds.
Assemblyman Richard Brodsky, D-Westchester, an opponent of the plan, said it was unlikely to pass and criticized Mayor Michael Bloomberg.
"The mayor has spent a year ignoring attempts to engage in a conversation about ideas," Brodsky said. "Instead, he engaged in a combination of hardball politics and Jedi mind tricks and they didn't work. This is not the City Council, and the net results for this is there are not enough votes."
One observer suggested that the Legislature was having a difficult time making tough choices in an election year and that there could be a special session after the November election to cut spending and raise taxes, but Forsythe offered a different possibility.
"A simpler scenario is that April 1 was a Tuesday and that the Legislature tends to work through the week and usually wear itself out on the weekend," Forsythe said. He suggested that a budget could be passed in the wee hours of the weekend. "If they stopped working, it would be interesting to find out why, but they're passing bills and once they start passing bills they usually end up going all the way through and pass a budget."
Sources from the state Senate and Assembly blamed the other side for holding things up.
"It's legitimate for them to blame each other because they each want something different from what the other side wants," said Frank Mauro, executive director at the Fiscal Policy Institute, a labor-oriented think tank. "They wouldn't be negotiating if they agreed on everything."
Early last week the Legislature passed two health care budget bills that included a shift in reimbursement away from acute care toward preventive care and began a process of "rebasing," which will update prices at which medical procedures are reimbursed by Medicaid to reflect advances in medicine. By Friday afternoon, the Legislature had passed an economic development and transportation bill.