ATLANTA -- Atlanta's Metropolitan Rapid Transit Authority plans to issue about $100 million of sales tax revenue refunding bonds next week, an authority official said yesterday.
Richard McCrillis, the authority's director of treasury services, said a syndicate led by Goldman, Sachs & Co. and Grigsby Brandford Powell Inc. is set to price $94.6 million of MARTA Series M refunding bonds debt next Tuesday.
That debt, he said, will refinance a total of $86.4 million of high-coupon bonds sold in December 1985: the 2000 through 2004 maturities of Series F bonds, and 1999 through 2004 maturities of Series G bonds. He said the refunded bonds would be escrowed to their first call on July 1, 1995 at 102.
"This sale is being done strictly to take advantage of lower interest rates," Mr. McCrillis said, noting that the refunding bonds would not extend the maturity length of the original borrowing. He added the authority estimates that the sale would achieve present value savings of about $4.5 million, as debt bearing coupon rates as high as 8 1/2% is replaced by bonds with coupons between 5.2% and 6.6%.
Mr. McCrillis said the authority is considering an additional refunding issue of up to $60 million if interest rates continue to improve. He also said the authority is anticipating selling about $50 million of new-money bonds in the next six months to help fund construction of extensions to the transit system's northern line.
The authority last sold refunding bonds in February 1989, when it offered $165.2 million of debt. It last sold new money bonds in April 1990, when it offered $85 million of Series L bonds.
Next week's sale will be the authority's first since voters rejected a proposal last November to extend the rapid transit system north of the immediate metropolitan Atlanta area into neighboring Gwinnett County -- a move that could have resulted in about $700 million of new tax-exempt borrowing. Those bonds would have been secured by a proposed one-cent increase in the county's sales tax, which would have generated about $50 million this year.
The authority currently has $825.3 million of debt outstanding in Series A through L bonds. Unrefunded debt is rated A-plus by Standard & Poor's Corp. and A by Moody's Investors Service.