Gov. Jim Edgar of Illinois last week signed legislation increasing authorization for the state's college-saver general obligation bond program, allowing Illinois to issue at least $150 million of the GOs next month.
The legislation increased authorization by $200 million. Until the legislation was signed, the state had only $82 million left of its $900 million authorization, according to Valerie Duewer, bond analyst for the state budget bureau.
Over the past four years, the state has sold $818 million of the college-saver GOs, Ms. Duewer said.
She said the amount of the sale, scheduled for Sept. 9 through Sept. 12, could be increased by $60 million if there is enough demand for the bonds.
Proceeds from the zero coupon general obligation bonds can be used for any purpose upon maturity, but bonuses are paid to individual investors who use the money to pay for higher education costs at an Illinois college or university, Ms. Duewer said.
First Chicago Capital Markets will be senior underwriter on the negotiated deal.
Co-managers on the deal will be Dean Witter Reynolds Inc.; A.G. Edwards & Sons Inc.; Kemper Securities Group Inc.; Edward D. Jones & Co.; KM Independence Group; LaSalle National Bank; Merrill Lynch & Co.; and Paine Webber Inc.