Public finance

Muni yields were cut up to five basis points Thursday, depending on the scale, after yields rose up to two basis points the day prior.

Market Intelligence analyst Jeff Lipton explains how California Mello-Roos land-secured bonds can add yield and diversification, and outlines the underwriting checklist investors should use to balance development risk against structural protections.

The spending plan includes revenue-raising measures involving the bond-issuing combined utility system that have sparked concerns by the city's controller.

The public power sector is reacting with concern about the ongoing efforts to reorganize the Federal Emergency Management Agency that's proposing shifting risk and disaster recovery costs onto local utilities.

Local governments will face "greater credit pressure" if voters largely eliminate property taxes on more than half of homes in the state, S&P analysts said.

California State Controller Malia Cohen released her monthly cash report and announced formation of a new economic advisory council this week.

Riverside Unified School District scrapped plans to develop a STEM center with the local University of California campus amid a critical state audit report.

The initial reaction following the CPI report didn't "move the needle" in the bond market, as the 10-year UST yield was just over 4.5%, said Jay Woods, chief market strategist at Freedom Capital Markets.

Illinois Gov. JB Pritzker proposed changes to address his state's underfunded pensions in his budget proposal. Two made it through the legislature.

Hays County prevailed in its appeal of a district court ruling affecting nearly $440 million of general obligation bonds voters approved in 2024.

On the state P3 front, PennDOT aims to complete a review of a proposed $5 billion toll lane project next year.

Volume was robust last week, with a nearly $20 billion new-issue calendar, and while supply dips to $13 billion this week, it will end up higher thanks to four sizable prepay energy deals that priced on Monday and Tuesday.

Four deals were on the day-to-day calendar, "playing it close to the vest, and all of a sudden, boom, they all get done," said Pat Luby, head of municipal strategy at CreditSights.

A proposed $3 billion sports and entertainment district would involve bond issuance for a Dallas Stars hockey arena and public infrastructure.

While the city projects a water emergency, capital costs in the state's latest water plan skyrocket and demand exceeds capacity in a state financing program.

Issuance continues to drive performance in the muni market. Despite Friday's run-up in USTs, muni yields adjusted "less dramatically," said Ajay Thomas, head of public finance at FHN Financial.

The House Appropriations Committee approved the fiscal year 2027 Transportation, Housing and Urban Development and Related Agencies last week by a vote of 34 to 27.

The $1.2 billion deal, issued by the California Community Choice Financing Authority and underwritten by Goldman Sachs, saw Alphabet as its funding recipient.

While muni primary supply falls this week, it is still robust. Issuance is an estimated $11.541 billion this week, with $8.501 billion of negotiated deals on tap, according to LSEG.

In need of revenue, some state legislatures are turning to their wealthiest residents for additional monies.