Tax-free prices closed little changed in light trading yesterday as traders waited on this week's big supply.

Topping today's negotiated calendar are $466.1 million Triborough Bridge and Tunnel Authority general purpose revenue bonds and $216.5 million California Housing Finance Agency home mortgage revenue bonds. A $100 million Ohio full faith and credit bond sale heads the competitive slate.

The TBTA issue is expected to be rated Aa by Moody's Investors Service and A-plus by Standard & Poor's Corp. It will be priced by an account led by Goldman, Sachs & Co.

Traders reported late yesterday that the maximum yield for the offering would be in the 7.15%-7.20% range.

The California HFA offering, rated Aa by Moody's and A-plus by Standard & Poor's, will be comprised of alternative minimum tax bonds and non-AMT bonds. Merrill Lynch & Co. is senior manager for the underwriting group.

The long yield on the AMT issue will be in the vicinity of 7 1/2%, while the maximum return for the non-AMT bonds should come in 20 to 25 basis points lower, traders said.

The Ohio issue is rated tripe-A by Standard & Poor's and Aa by Moody's and goes off at 11 a.m. EDT this morning.

In yesterday's light new-issue activity, a Lehman Brothers account tentatively priced $65 million Prince George's County, Md., general obligation refunding bonds, rated AA-minus by Standard & Poor's and Fitch Investors Service.

Reoffering yields on the current interest portion of the loan are expected to run out to 7.05% in 2011. The capital appreciation bond yields tentatively run out to 7.05% in 2009.

A Goldman, Sachs & Co. group marketed $61.7 million Michigan State Hospital Finance Authority hospital revenue bonds for Sisters of Mercy Health Corporation.

The offering included term bonds priced at 96.725 as 7 3/8s to yield 7.70% in 2011, term bonds of 2018 priced at 97.187 as 7 1/2s to yield 7.75%, and term bonds of 2021 priced at 92.41 as 7s yield 7.65%.

There were also serial bonds priced at par and scaled from 6.80% in 1997 to 7.45% in 2002.

The bonds are rated A by Moody's and A-minus by Standard & Poor's. The underwriters received the verbal award in the afternoon.

In the competitive market, a Lehman Brothers account won a $35 million Northshore School District No. 417 (King and Snohomish Counties), Wash., insured unlimited tax bond issue, and reported a $24 million unsold balance.

The bonds were priced to yield from 4.70% in 1992 to 7.10% in 2008-10.

The issue will be backed by Financial Guaranty Insurance Co. and rated triple-A by Standard & Poor's and Moody's.

In a late afternoon sale, a Rauscher Pierce Refsnes Inc. group had the successful bid for $34 million Irving Independent School District (Dallas County), Tex., unlimited tax school building bond issue and reoffered them to investors at yields out to 6.95% in 2007-11.

The issue is backed by the Permanent School Fund and is rated triple-A by Moody's and Standard & Poor's.

In secondary dollar bond trading yesterday, Metropolitan Seattle 6 7/8s of 2031 were quoted late in the day at 95 1/8-1/4 to yield 7.24%. Hawaii airport AMT 7s were at 97 1/8-1/2 also yielding 7.24%. And South Carolina Public Service Authority 7.10, due 2021, closed at 98 1/2-3/4, where they returned 7.20%.

In the more vintage dollar bond market, New Jersey Turnpike Authority 7.20s of 2018 were being bid near the close at 101 1/2 to yield 6.94% to the 1999 par call and were being offered at 102, returning 6.85% to the call.

Serial bond trading was virtually non-existent in the secondary, traders said. There were a couple of items out for the bid and that was all, they added.

Not even a downgrading in Suffolk County, N.Y., debt could trigger any action. Once New York salesman said that there aren't any uninsured Suffolk County bonds around in the secondary. A couple of traders were willing to bid on some blocks if they came out, but they didn't see any.

Standard & Poor's dropped the rating yesterday on Suffolk County's $271 million outstanding uninsured GO bonds to BB from BBB, and placed the bonds on CreditWatch with "negative implications." It also cut the rating on $51 million tax anticipation notes to non-investment grade SP-3 from SP-2.

Standard & Poor's said the downgrades reflected "chronic fiscal instability evidenced by weak financial operations since fiscal 1986, a rapidly deteriorating cash position, and failure by the legislature and the County Executive to agree on the severity of the problem, or a plan to address it on a short-term and long-term basis.

"The county has failed to address its fiscal imbalance with a comprehensive plan and continues to patch the budget with quick-fix solutions, such as the issuance of delinquent tax anticipation notes."

Standard & Poor's went on to point out that "set-aside of delinquent taxes, which were expected to repay the series 1990 notes at maturity on Aug. 28, began late, so the amount restricted for repayment will be insufficient to pay off the notes without use of other county resources.

"The cash flow statement prepared by the comptroller's office projects a negative $8 million ending cash balance for August, and a negative $43 million in December, if both operations and debt service are provided for. These deficit balances include the proceeds of a planned borrowing in September of $55 million against delinquent taxes. However, if approval is granted by the county legislature, $34 million of borrowable resources may be used to cover the cash shortfall. Such approval is not assured at this time."

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