Public finance

IOWA

Standard & Poor's Tuesday downgraded Detroit's already junk-rated $5.9 billion of water and sewer bonds warning of a default even as the city turns to the private sector to take over the asset.

Municipal bonds are a better option than P3s for water utilities, an environmental advocate told a special House P3 panel Tuesday.

Municipal strategists are recommending non-traditional ways to manage the risk of rising interest rates after a surge in the price of short term bonds.

The judge overseeing Detroit's bankruptcy case ordered the city to disclose more details of a proposed $120 million loan with Barclays, including financing terms and the use of proceeds.

ALABAMA

IOWA

Maryland can proceed with the selection of a private partner to design, build, and operate the $2.4 billion Purple Line commuter rail project via a public-private partnership after federal approval last week of the environmental impact statement.

Expectations for rising interest rates, continued low supply, and credit spread tightening are prompting municipal portfolio managers preparing for the second quarter to tweak the duration and credit quality of their tax-exempt holdings, while keeping a wary eye on the economy.

The Detroit Water and Sewer Department plans to come to market in June with $150 million of sewer bonds — and possibly a restructuring of its entire $4 billion portfolio — in the midst of the city's tumultuous bankruptcy and talks to privatize the asset.

The counterparties to Detroit's interest-rate swaps mounted their first public defense of a controversial settlement with the city Friday, arguing that the derivatives are legally secured and warning that litigation would be costly and painful for Detroiters.

ALABAMA

A trio of financings from California, Georgia, and New York will lead the primary market as the first quarter winds down with another week of meagre supply.

The Federal TIFIA loan program provides lower cost capital for toll roads, but can increase bondholder risk, Moody's Investors Service said in a new report.

The Harlem building collapse has added a big exclamation point to talk about the need for New York to address its aging infrastructure.

The bond insurers that wrap Detroit's unlimited-tax general obligation bonds have been ordered into a Monday mediation session with the city several weeks after the judge overseeing the case said he would issue a ruling on whether or not the city can treat the debt as unsecured.

CALIFORNIA

ARIZONA

Municipal mutual funds reported inflows slowed to $107.3 million in the week ended March 20 from $223.8 million of inflows the week before. Assets of all weekly reporting municipal funds increased to $282.32 billion from $282.2 billion, Lipper FMI reported.

Aviation groups difference over a proposal to fund airport infrastructure projects with higher passenger facility charges.