The Vault

2019

Calendar of recent and upcoming public finance activities and bond sales

September 5

Various Purpose General Obligation Bonds and Various Purpose General Obligation Refunding Bonds ($2.4 billion)

The $2,405,320,000 sale included $1.741 billion of refunding bonds to refinance previously issued bonds under 24 different bond acts for debt service savings, and converts $250 million of variable rate bonds to a fixed rate. The refunding is expected to save taxpayers $690 million over the next 20 years (or $588 million on a present value basis). Final yields to investors ranged from a low of 1.07% for a 2020 maturity with a 3% coupon to a high of 2.72% and 2.07% for 2049 maturities with 3% and 5% coupons, respectively. The all-in true interest cost was 2.54%.

September 17

State Public Works Board Lease Revenue Refunding Bonds, 2019 Series B ($60.9 million)

There were 11 bids from broker-dealers, with UBS Financial Services Inc. submitting the winning bid at an all-in true interest cost of 1.837%. The refinancing of bonds issued in 2006-2007 will result in a savings of $15.7 million to taxpayers over the next 14 years (or $14.4 million on present value basis.)

October 16

Federally Taxable Various Purpose General Obligation Bonds and Various Purpose General Obligation Refunding Bonds ($1.13 billion)

The bonds were sold via two separate competitive bids, the first was for $680.13 million of bonds to provide funds for voter-approved projects and programs. The bonds attracted 11 bids from broker-dealers, with BofA Securities submitting the winning bid at an all-in true interest cost of 2.359%. The second was for $457.4 million of refunding bonds to refinance previously issued GO bonds. The refunding bonds attracted 10 bids from broker-dealers, with Morgan Stanley & Co. submitting the winning bid at an all-in true interest cost of 2.39%. The refinancing will result in a savings of $37.8 million to taxpayers over the next 20 years (or $31.6 million on present value basis).

October 29

State Public Works Board Lease Revenue Bonds, 2019 Series C ($313.3 million)

Proceeds will provide funding for Department of Forestry and Fire (CalFire) to fund the Ione Academy Dormitory project; four California Department of Corrections and Rehabilitation (CDCR) jail projects: (1) the Riverside County Jail project; (2) the Santa Barbara County Jail project; (3) the Tulare County Jail project; (4) the Sutter County Jail project; and Health Care Facility Improvement Program projects at 19 correctional facilities operated by CDCR. Loop Capital Markets LLC and Siebert Cisneros Shank & Co., LLC served as joint senior managing underwriters, with Alamo Capital serving as co-senior manager. In addition, there were also 11 co-managers to round out the syndicate. The all-in true interest cost was 2.599% and final yields to investors ranged from 1.08% in 2020 to 2.29% in 2044.

November 13

Various Purpose General Obligation Bonds and Various Purpose General Obligation Refunding Bonds ($685 million)

The sale included $397 million of Various Purpose GO Bonds and $288 million of Various Purpose GO Refunding Bonds. The $397 million of Various Purpose Bonds will be used to paydown commercial paper notes that provided interim financing for projects under 15 bond acts approved by voters between 1998 and 2018. The $288 million of Refunding Bonds will be used to refinance bonds issued in 2009, at a savings to California taxpayers of $154.9 million over the remaining life of the bonds, or $122.7 million on a present value basis. The State received bids from 12 broker-dealers. Due to strong interest in the bond sale, the State obtained low-cost long-term financing for vital voter-approved infrastructure projects throughout California and reduced debt service costs associated with previously issued bonds.

November 19

California Health Facilities Financing Authority: No Place Like Home Program Senior Revenue Bonds (Social Bonds - Federally Taxable) ($500 million)

Proceeds will provide funding to the Department of Housing and Community Development’s No Place Like Home Program to assist in the production of permanent supportive housing for persons who are experiencing homelessness, chronic homelessness or who are at risk of chronic homelessness, and who are in need of mental health services. The 15-year fixed rate revenue bonds were sold by an underwriting syndicate of 15 broker-dealers led by Raymond James & Associates, Inc. and Citigroup Global Markets Inc. The bonds are rated Aa3 by Moody’s Investors Service, AA- by Fitch Ratings and AA- by Standard & Poor’s. The all-in true interest rate on the bonds, which are subject to federal income tax, is 2.77%. Yields to investors ranged from 1.896% for the 2021 maturity to 3.034% for the 2034 maturity. The syndicate generated in excess of $2.3 billion of total orders from over 100 unique investors, including $84 million directly from international investors, $596 million from 13 investors with Environmental, Social and Governance (ESG) and Socially Responsible Investing (SRI) objectives, and $200 million from 18 local government investment funds.

December 5

IBank, California State Teachers’ Retirement System (CalSTRS) Headquarters Expansion Lease Revenue Bonds, Series 2019 (Green Bonds) ($281 million)

Proceeds will be used to construct, furnish and equip an expansion to the existing headquarters of CalSTRS in the City of West Sacramento.

More information about the upcoming fall bond sales can be found at: https://www.buycaliforniabonds.com The bond issuances described above (including the amounts and timing thereof) are preliminary and subject to change or cancellation based on market conditions or other factors as determined by the State Treasurer.