ATLANTA - The Municipal Electric Authority of Georgia has approved the sale of about $440 million of revenue bonds next week to advance refund $402.4 million of existing debt, the authority's head of finance said yesterday.

Ronald O. Vasquez, vice president of financial services, said that MEAG's board of directors on Monday decided to move quickly with the deal to take advantage of available 1993 Georgia private-activity bond allocation, which expires Dec. 31.

Because of the authority's participation in projects with the Georgia Power Co., a private utility, a $52 million portion of the planned issue must be designated as private-activity debt, Vasquez said.

"Since the total amount of our [private-activity] allocation next year will only be about $55 million, we decided to use the available 1993 cap and get this deal done now," he said.

Vasquez said that the board also was satisfied that it would realize sufficient savings by holding the refunding now, given the current level of interest rates. He estimated that at today's rates, net present value savings would exceed 6%, or $30 million, well above the threshold of 4% set by the authority.

According to Gordon Mortin, financial adviser to the authority, the deal will be priced Tuesday by a syndicate led by CS First Boston. He said the bond award has been set for the next day, Dec. 15, at an authority board meeting.

Mortin, who is president of Lex Jolley & Co., a division of Atlanta-based Bank South Securities Corp., said that officials plan to close the issue on Dec. 29.

Vasquez said that he expects the offering to be insured and that the authority will probably choose its insurer by tomorrow from bids submitted by AMBAC Indemnity Corp., Financial Guaranty Insurance Co., and Municipal Bond Investors Assurance Corp.

This has been a busy year for the authority. It has issued $758.6 million of revenue debt in four series: $176.7 million offered in April, and $521.9 million, $36 million, and $24 million sold in March.

Vasquez said the authority also plans several sales in 1994. By the end of the first quarter, he said, it will probably issue about $400 million of current refunding debt. In the third quarter, the authority expects to sell about $160 million of new-money bonds, using about $100 million of the proceeds to extinguish a bank line of credit and about $60 million to fund transmission facilities.

Municipal Electric Authority of Georgia was created by the state in 1975 to own and operate electric generation and transmission facilities for local governments. The authority has entered into sales agreements with 47 cities and one county.

The authority has about $4 billion of net debt outstanding, according to Vasquez.

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