Municipal bond sales rose 44% in the first five months of 1992, putting the market firmly on track toward a $200 billion year, according to figures from Securities Data Co./Bond Buyer.

State and local governments sold $83.78 billion of new bonds through May 31, up from $58.19 billion in the same period a year ago. If sales continue at the current pace, barring any major interest rate increases or tax law changes, the market would finish the year with roughly $201 billion in sales.

Refunding continued to lead the surge in financing with an 84% jump, to $27.95 billion from $15.15 billion. New-money issuance posted a smaller but still substantial increase of 30%, to $55.84 billion from $43.04 billion.

Much of the increase in volume can be attributed to issuers taking advantage of low interest rates to retire high-yield debt. So far this year, The Bond Buyer's 20-bond index of general obligation bonds has hovered between 6.40% and 6.79%, well below its range of 7% to 7.15% in January 1991 to May 1991.

The rapid pace of new sales slowed somewhat in May, with $15.74 billion coming to market. That made May the second smallest month so far this year. While May's volume exceeded the May 1991 total of $15.27 billion by 3%, the previous four months' totals all exceeded their 1991 levels by 34% to 91%.

Securities Data's figures, however, are preliminary and subject to substantial revision. April's volume, for example, was revised to $18 billion, up more than $1.7 billion from last month's initial figure of $16.23 billion.

Education, the leading specific purpose for municipal financing, rose 42% in the first five months of 1992, to $15.5 billion from $10.94 billion a year ago.

Bonds sold for utilities, the second leading purpose, jumped 59%, to $9.68 billion from $6.08 billion.

Transportation was the third largest sector, surging 96%, to $9.18 billion from $4.69 billion. Airport bonds continued to skyrocket, with a 146% increase to $3.02 billion. Highway financing almost doubled to $3.83 billion.

Health-care volume climbed to $7.84 billion, an increase of 48% over the $5.29 billion recorded a year ago. Housing rose 19%, to $5.3 billion from $4.44 billion. Electric power rose 5% to $4.43 billion from $4.21 billion, while industrial development financing posted a 35% rise to $2.67 billion from $1.98 billion. Environmental issues were up 17%, to $2.64 billion from $2.26 billion.

Public facilities, which include government offices, jails, and recreation, were the only category to decline from a year ago, slipping 3% to $2.97 billion from $3.07 billion. Bond issuance for jails and prisons fell 23%, to $933 million from $1.22 billion.

General-purpose issues, the largest segment of municipal finance, rose 54% through May, to $23.51 billion from $15.23 billion. This group included May's largest single financing, a $750 million New York City general obligation sale.

Negotiated offerings surged 57%, to $67.47 billion from $41.02 billion, while competitively bid sales rose 15%, to $18.66 billion from $16.17 billion. Private placements fell 35%, to $657 million from $1 billion.

Bonds subject to the alternative minimum tax increased 6%, to $5.09 billion from $4.82 billion. Taxable deals jumped 46%, to $1.63 billion from $1.12 billion.

General obligation issues jumped 58%, to $32.44 billion from $20.5 billion. Revenue bond sales rose a smaller but still strong 36%, to $51.34 billion from $37.69 billion.

Municipal bonds enhanced by bond insurance surged 63%, to $29.73 billion from $18.2 billion, and boosted their market share to 35% from 29% in the same period a year ago. Bonds secured by insured mortgages or collaterized by mortgage securities rose 18%, to $1.74 billion from $1.48 billion. Bonds backed by letters of credit dropped 29%, to $2.37 billion from $3.36 billion.

Variable-rate financing rose 15%, to $3.86 billion from $3.36 billion.

State government issues increased 42%, to $9.97 billion from $7.02 billion, and state agency sales grew 54%, to $21.25 billion from $13.82 billion. Bonds sold by municipalities rose 51%, TO $37.55 billion from $24.85 billion, and local authority sales posted a 21% increase, to $13.52 billion from $11.13 billion. Bonds sold by public universities and colleges were up 7%, to $1.48 billion from $1.38 billion.

California issuers were the busiest through the first five months, bringing $8.89 billion to market, up 3% from $8.66 billion a year earlier. New York issuers were second with $7.23 billion, up 11%, followed by Texas with $7.12 billion, up 37%; Florida with $5.75 billion, up 84%; and Illinois with $3.96 billion, up 91%.

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