NEW YORK, Dec 13 (Reuters) - The New York Metropolitan Transportation Authority plans to issue $750 million of taxable Build America Bonds next week to fund its 2011 capital expenses, a spokesman for the agency said on Monday.
The debt sale will allow the agency to take advantage of the popular BABs program -- which pays issuers federal rebates equal to 35 percent of the bonds' interest costs -- before it expires at the end of the year.
'There have been various proposals to extend the Build America Bonds program, but at this point none of them has been acted on,' MTA spokesman Aaron Donovan said.
'We'd like to take advantage of the 35 percent subsidy while it's still a certainty,' he said.
The agency's finance committee approved the issuance on Monday, and it will go before the full MTA board at a meeting on Wednesday.
If approved, the deal will account for nearly half of the agency's projected $1.64 billion in capital borrowing for the coming year.
The bonds, which are expected to be priced around Dec. 22, will be backed by the agency's revenues, including fares collected from bus and subway riders.
Also on Monday, the committee voted to increase the pool of senior managers for its bond sales from three to 10, Donovan said.
In addition to existing managers -- JPMorgan Chase & Co , Barclays Bank Plc and Citigroup Inc -- the committee added Morgan Stanley, Wells Fargo & Co , Jefferies Group Inc, Goldman Sachs Group Inc , Bank of America Corp, Siebert Brandford Shank & Co. and Samuel A. Ramirez & Co, Donovan said.
The committee also approved a proposal that picks Goldman Sachs to manage issuance under a new program that backs bonds with revenue from the payroll mobility tax, which was adopted by the state legislature last year, Donovan said.
All of the additions must be approved by the full board.
(Reporting by Edith Honan; Editing by Kenneth Barry) Keywords: NEWYORK MTA/BONDS (edith.honan@thomsonreuters.com; +1-646-223-6323) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.
The debt sale will allow the agency to take advantage of the popular BABs program -- which pays issuers federal rebates equal to 35 percent of the bonds' interest costs -- before it expires at the end of the year.
'There have been various proposals to extend the Build America Bonds program, but at this point none of them has been acted on,' MTA spokesman Aaron Donovan said.
'We'd like to take advantage of the 35 percent subsidy while it's still a certainty,' he said.
The agency's finance committee approved the issuance on Monday, and it will go before the full MTA board at a meeting on Wednesday.
If approved, the deal will account for nearly half of the agency's projected $1.64 billion in capital borrowing for the coming year.
The bonds, which are expected to be priced around Dec. 22, will be backed by the agency's revenues, including fares collected from bus and subway riders.
Also on Monday, the committee voted to increase the pool of senior managers for its bond sales from three to 10, Donovan said.
In addition to existing managers -- JPMorgan Chase & Co , Barclays Bank Plc and Citigroup Inc -- the committee added Morgan Stanley, Wells Fargo & Co , Jefferies Group Inc, Goldman Sachs Group Inc , Bank of America Corp, Siebert Brandford Shank & Co. and Samuel A. Ramirez & Co, Donovan said.
The committee also approved a proposal that picks Goldman Sachs to manage issuance under a new program that backs bonds with revenue from the payroll mobility tax, which was adopted by the state legislature last year, Donovan said.
All of the additions must be approved by the full board.
(Reporting by Edith Honan; Editing by Kenneth Barry) Keywords: NEWYORK MTA/BONDS (edith.honan@thomsonreuters.com; +1-646-223-6323) COPYRIGHT Copyright Thomson Reuters 2010. All rights reserved. The copying, republication or redistribution of Reuters News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Reuters.