Revenue bond issues for large transportation initiatives in three states and two sizeable note deals will be at the forefront of the primary market this week.

The transportation offerings hail from Texas, Florida, and Kentucky. They are part of an estimated $5.71 billion in total new, long-term volume planned for pricing, according to Ipreo LLC and The Bond Buyer.

A revised $5.71 billion was actually priced last week, according to Thomson Reuters.

The largest transportation deal is a $600 million sale of private-activity senior-lien bonds from Texas that is expected to be priced tomorrow by Bank of America Merrill Lynch.

The bonds are rated Baa3 by Moody’s Investors Service and BBB-minus by Standard & Poor’s. The structure was not available at press time, according to a source at Merrill.

Florida’s Orlando-Orange County Expressway Commission will follow suit Wednesday with a $500 million offering planned by senior manager Bank of America Merrill Lynch, after a retail order period tomorrow.

The bonds are rated A by Standard & Poor’s and Fitch Ratings. The structure was still being finalized at press time.

Elsewhere in the Southeast, a $334.2 million sale of economic development road revenue bonds is being planned by the Kentucky Turnpike Authority. Goldman, Sachs & Co. is expected to price the offering tomorrow, after conducting a retail order period today.

The deal consists of $148.6 million of Series A tax-exempt economic development revenue refunding bonds and $185.5 million of Series B taxable Build America Bonds.

The mounting supply is arriving at the height of the June reinvestment season and some municipal players say there are new deals still carrying unsold balances from last week due to market weakness.

“The market has sold off this week, and given the tone of the market, investors have pulled back,” Peter Hayes, managing director at BlackRock Inc. in Princeton, N.J., said Thursday.

The generic triple-A general obligation scale in 30 years closed at a 4.04% on Thursday, after having ended at a 4% the previous day, according to Municipal Market Data.

“With the calendar a little bigger than it’s been, it shows how fragile the liquidity of the municipal market is,” Hayes said. “With the combination of the heavy calendar and low absolute yields, new issues have come at market prices that have not been well-received, and underwriters have had to cut prices and adjust the scales.”

He said BlackRock — which had $106 billion of municipal assets under management as of March 31 — has participated in some credits where spreads make sense and is active in the BAB sector, but remains relatively cautious overall.

“Although this is a period of high municipal reinvestment, historically, June has shown weak absolute price performance,” Hayes said. “This year is no exception and we won’t see improvement until supply abates or yields rise to the point where investors care.”

In other prominent deals this week, a pair of note offerings totaling over $1 billion are being planned by issuers in Wisconsin and California to help finance their general fund cash-flow needs for fiscal 2010-2011.

Wisconsin will competitively sell $800 million of one-year operating notes tomorrow, while the Los Angeles Unified School District is planning to sell $540 million of tax and revenue anticipation notes in a negotiated sale tentatively planned for pricing tomorrow by Bank of America Merrill Lynch.

Meanwhile, in the the Midwest, Illinois will make an appearance twice this week. Its first deal could bring up to $500 million of sales tax revenue refunding bonds to market tomorrow in a negotiated pricing planned by Cabrera Capital Markets LLC.

The state’s other offering consists of $300 million of GO BABs that are slated for competitive sale on Thursday and structured to mature serially from 2011 to 2035.

The refunding will be structured with serial bonds maturing from 2011 to 2021 and rated with a natural AAA from Standard & Poor’s and AA-plus from Fitch — characteristics that should draw significant institutional demand — as well as modest retail interest, according to Mitchell Kapnick, managing director of municipal securities at Cabrera.

“The coverage is strong, the credit rating is there, and it’s a desirable part of the curve,” he said of the deal’s strengths.

Hayes of BlackRock agreed about the yield curve’s sweet spot, but declined to disclose information on specific credits he currently owns or intends to purchase.

“The long end is the most vulnerable, and the intermediate maturities represent more value — you can capture 75% of the steepness of the curve by going out to the 10-year range instead of 30 years, with 50% of the duration risk,” Hayes said.

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