Lebenthal & Co. will offer about $8.5 million of zero-coupon securities, called "Tax-free Beginner Bonds," as part of an offering of approximately $24 million Erie County, N.Y., general obligation bonds, the firm said on Monday.

The beginner bonds will be sold for a minimum of $1,700 each, depending on maturity.

Maturities of the bonds will range from five to 20 years. Yields on the securities are expected to range from 4% to 5.30%. Lebenthal said in a press release.

Lebenthal expects to price the beginner bond portion of the Erie County issue today.

The firm is a co-senior manager of the offering, overseeing the beginner bond sale. Smith Barney, Harris Upham & Co. is the book-running manager.

The securities, with their lower than usual minimum price, are designed to appeal to first-time municipal bond purchasers. Traditionally, municipal bonds are sold in minimum blocks of $25,000, a deterrent to many small investors.

"The little guy has been shut out of becoming part of the best long-term savings institution in this country," said James A. Lebenthal, chairman of Lebenthal & Co.

"Municipal bonds have always been too good for the rich alone, but now anyone saving for long-term goals can get started in tax-free municipal bonds."

The sale of the beginner bonds will be supported by a multimedia advertising campaign, to include newspapers, radio, and cable television, as well as posters and brochures.

Westchester County, N.Y., offered similar securities to investors as part of an approximately $40 million general obligation bond offering sold in May. Beginner bonds comprised about $16 million of that deal.

The Erie County GOs are insured by AMBAC Indemnity Corp. and therefore rated triple-A by both Moody's Investors Service and Standard & Poor's Corp.

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