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Strategies & Market Trends : The Epic American Credit and Bond Bubble Laboratory -- Ignore unavailable to you. Want to Upgrade?

To: anachronist who wrote (51757)	1/27/2006 3:41:28 PM
From: shades	Read Replies (1) \| Respond to of 110194

=DJ MUNI WATCH: Orange County, Calif Buying Own Pension Note . By Stan Rosenberg A DOW JONES NEWSWIRES COLUMN NEW YORK (Dow Jones)--If you're a municipal government looking to save money on your pension costs, you might want to have a look at Orange County, Calif. The county, which in 1994 filed for the largest municipal bankruptcy ever, priced Friday a $117 million private placement of taxable notes. The buyer was Orange County's treasury, which is purchasing the notes for its own investment pool. The deal resulted from an agreement with the Orange County Employees' Retirement System, which offered the county a 7.5% discount for advance payment of half of its fiscal 2007 annual pension contribution, county treasurer John M.W. Moorlach said. "Basically, it's a prepayment opportunity," that will save the county about $4 million, which is money it can use to address other cost issues, he said. The notes will mature June 30, 2007 - the end of the fiscal year - but would contain a feature allowing them to be sold back to the county in 13 months, Moorlach said. In that case, the county's liability would be about $50 million, but "it would have available reserves to honor that," he said. The securities would pay only the unfunded liability portion of the county's annual contribution to the pension fund. They wouldn't fund current-year contributions. "The portion that's normal cost, the county will find funds to pay for that," Moorlach said. A summary of the finance plan circulated by the county indicated it had explored other options for financing the prepayment. It said, however, that the use of cash reserves "would reduce liquidity below comfortable levels" and that interfund borrowing would have to be repaid within the same year. Initial thinking estimated the notes might be priced at 20 to 35 basis points above the 1-month London interbank offered rate, but they were priced Friday at 15 basis points over, based on a recommendation by Oakland-based financial adviser Kelling, Northcross & Nobriga. One-month Libor Friday was around 4.57%, producing an initial rate of about 4.72%. That rate will be reset monthly. Because the deal is strictly an internal transaction, no underwriter was required, Moorlach said, adding that his costs are being held to just a financial adviser, bond counsel and the price of ratings. "Tell all the underwriters we're just trying to save money, you know?" the treasurer said. The notes will be funded on Monday, and the entire amount turned over to the retirement system immediately instead of making payroll period payments every two weeks. The notes received Moody's highest rating for a taxable short-term security, P1. Standard & Poor's assigned its highest short-term rating of SP-1-plus and a commercial paper rating of A1, reflecting the February 28, 2007 put feature. (Stan Rosenberg, a veteran observer of the municipal bond industry, writes about issues and trends in the muni market for Dow Jones Newswires.) -By Stan Rosenberg, Dow Jones Newswires, 201-938-2143; stan.rosenberg@dowjones.com (END) Dow Jones Newswires Huh?

To: anachronist who wrote (51757)	1/27/2006 3:42:16 PM
From: shades	Respond to of 110194

DJ Muni Pricing Calendar: $1.3 Billion Tobacco Settlement . (NEGOTIATED, Wk Of Jan. 30) Amt Issuer & Type Senior Underwriter ($ Mln) 1,300.000 Tobacco Settlement Asset Securization Bear, Stearns Corp. (NYC), Refunding 632.000 Los Angeles Unified School Dist., Merrill Lynch Calif., General Obligation 300.000 Los Angeles County Tobacco, Calif. Citigroup Global Mkts 240.000 Los Angeles Dept. of Water & Power, Merrill Lynch Calif., Water System Revenue 234.700 R.I. Health & Educational Building Morgan Stanley Corp., Hospital Financing Revenue 187.510 R.I. Economic Development Corp., Grant UBS Securities Anticipation

To: anachronist who wrote (51757)	1/27/2006 3:42:51 PM
From: shades	Respond to of 110194

DJ CORRECT:Envoy:India No Vote Devastating To US Congress U.S. Ambassador David Mulford said Wednesday that if India doesn't vote next month to refer Iran to the Security Council, which could impose sanctions, "our view is that the effect on members of Congress with regard to this civil nuclear initiative will be devastating." (In an item timed at 10:44 a.m. EST, "India Backs Russia Option For Dealing with Iran Nukes," the comments of the U.S. ambassador were misstated.)